RI Commercial court rules in favor of Tri Polyta
RI Commercial court rules in favor of Tri Polyta
Dow Jones, Jakarta
An Indonesian commercial court has thrown out a bankruptcy suit filed by U.S. creditors hoping to get their money back from a company linked to former president Soeharto.
The Jakarta Commercial Court on Thursday dismissed the petition by the creditors, led by OCM Opportunities Fund LLP, to declare PT Tri Polyta Indonesia bankrupt, saying there was no proof that the OCM official who signed the petition represented OCM, said the lawyer representing the creditors.
The court's decision, however, wasn't surprising as it has a history of ruling against foreign companies.
"There was doubt on the capacity of the authorizer," the lawyer Rahmat Bastian told Dow Jones Newswires Friday.
The official who signed the petition was a vice-president with OCM, he said, but the judges ignored evidence of his status attached in the petition.
Rahmat said his clients will file an appeal against the commercial court's decision to the Supreme Court within a week.
OCM - a Delaware-based private-equity concern - and other creditors, armed with a U.S. court ruling, filed the bankruptcy suit earlier this month, seeking foreclosure on Tri Polyta's assets after the petrochemical company stopped paying interest on US$185 million worth of bonds four years ago.
The creditors turned to the commercial court after Tri Polyta managed to persuade an Indonesian district court in April to block any foreclosure action against its assets. Tri Polyta took the move after creditors got a U.S. federal court order in April saying Tri Polyta must repay the principal and default interest.
But the Jakarta Commercial Court, like other Indonesian courts, has tended to rule against foreign companies and is increasingly refusing to enforce foreign judgments.
In one case last year, the court ruled the local unit of Canada's Manulife Financial Corp. (MFC) bankrupt even though it was profitable. The Supreme Court overruled that decision after international pressure.
Tri Polyta is Indonesia's largest maker of polypropylene resins used in packaging.
Prajogo Pangestu, the founder of Barito Group and a shareholder in the debt-laden petrochemical company PT Chandra Asri, owns 46.46 percent stake in Tri Polyta.
He bought the stake in stages in 2001 and 2002 from Tri Polyta's original shareholders, which included Suharto's son Bambang Trihatmojo.