KPPU loses legal battle in Indomobil case

KPPU loses legal battle in Indomobil case

A'an Suryana, The Jakarta Post, Jakarta

The Business Competition Supervisory Commission (KPPU) has
lost a legal battle against parties it ruled to have manipulated
the Indomobil sale last year.

The Supreme Court said that the KKPU ruling was legally flawed
because the anti-monopoly watchdog used a statement "For the
shake of justice, based on the belief in one Supreme God" in its
decree.

"KPPU is not a legal body, so it does not have the rights to
include this statement in its ruling. There is no law that gives
rights to KPPU to use the statement," senior judge Paulus Effendy
Lotulung quoted as saying on Thursday by hukum-online.com news
portal.

He urged KPPU to renew the ruling.

He did not say when the Supreme Court decision was made.

KPPU could not comment on the decision, claiming that it had
not received the ruling yet.

KPPU ruled in May last year that six parties had conspired
during the sale process of the government's 72 percent stake in
the publicly-listed PT Indomobil Sukses International, the
country's second largest car maker.

A consortium led by PT Trimegah Securities won the stake for a
cheap price. There had been allegations that members of the
consortium were basically linked to Salim Group, the former owner
of the car manufacturer. The group transferred its stake in the
car company to the government to repay the Salim family's debt to
the central bank. The government has banned this family from
repurchasing the asset.

But three parties including Trimegah, Deloitte Touche Tohmatsu
(the adviser of the government in the sale process), and PT
Bhakti Asset Management (consortium member) alleged by KPPU to be
involved in the conspiracy had protested the ruling and won the
case at the Central Jakarta District Court and the State
Administrative Court.

KPPU then filed an appeal with the Supreme Court.

Many had earlier doubted that the local court could handle the
high profile Indomobil scandal because the judges lack both the
quality and experience in understanding complex monopoly issues
and modern business practices.

There has also been a strong perception that the local courts
were corrupt.

The Indomobil case erupted after the sale of the Indomobil
stake was conducted in a very short period and resulted only in a
relatively small amount of proceeds. The quick sale process has
raised concern that other bidders could not have sufficient time
to make proper assessment before making an offer.

KPPU then launched an investigation and found six parties
guilty ordering them to pay penalties.

The Indomobil case is seen as a litmus test of whether the
antitrust body really has the teeth to protect the market and
business sector from unfair competition.

It is also the first major case handled by the commission
within the enforcement of Law No.5/1999 on the prohibition of
monopolistic practices and unfair business competition.

Elsewhere, Paulus also said that the Supreme Court had
overturned the ruling of the Central Jakarta District Court
because KPPU was not a legal entity and therefore had no rights
to perform in the court.