KPPU in court battle over Indomobil case

Dadan Wijaksana, The Jakarta Post, Jakarta

The Business Competition Supervisory Commission (KPPU) said it would appeal to the Supreme Court over a recent ruling by the State Administrative Court that effectively annulled KPPU's sanctions against PT Trimegah Securities over the high-profile Indomobil scandal.

KPPU executive director M. Nawir Messi confirmed the plan on Wednesday, saying the ruling had undermined the commission's role as an antimonopoly watchdog.

"The verdict might as well have ordered KPPU not to continue in its current task of ensuring fair business competition. We're definitely going to appeal," Nawir told The Jakarta Post.

On July 15, the State Administrative Court ruled in favor of Trimegah, stating that KPPU had neither the right nor legal basis to summon Trimegah over the Indomobil case.

"If we are not allowed to do that, there's no point in having KPPU," Nawir added.

Trimegah leads a consortium that last year won the tender for the government's 72 percent stake in PT Indomobil Sukses Internasional, the country's second-largest car maker.

But there were accusations that the sale process was plagued by irregularities. The Trimegah-led consortium managed to win the stake at a relatively low price. There have also been suspicions that the founder of Indomobil was behind the consortium. The government has banned the Indomobil founder, the Salim Group, from repurchasing the company. Indomobil is part of the Salim assets transferred to the government to repay the group's debts.

This prompted KPPU to launch an investigation, which included summoning Trimegah and other parties believed to have been involved in the alleged scandal.

KPPU was established by the government to help ensure fair business practices in the country as stipulated under Antimonopoly Law No. 5/1999, which rules that businesses are prohibited from conspiring with other parties to win a tender.

The commission completed the investigation process in May, and faulted Trimegah for being involved in the "conspiracy." KPPU ordered Trimegah and other parties involved to pay financial penalties and barred the firm from participating in a future sale of assets held by the Indonesian Bank Restructuring Agency (IBRA).

But Trimegah denied any wrongdoing, and filed appeals with the administrative court and the South Jakarta District Court.

Trimegah said that KPPU had tarnished the image of the securities firm and frightened away clients, causing damage to its business.