'Stock mart law gives excessive power to Bapepam'
JAKARTA (JP): Lawyer Todung Mulya Lubis said yesterday that the new stock market law gives excessive power to the Stock Market Supervisory Agency (Bapepam) without conferring full independence on the body.
"There are many obligations given to Bapepam. The question is whether Bapepam will be able to shoulder all the responsibilities effectively and autonomously," Mulya said in a seminar on the new law at the Horison hotel, organized by the Association of Indonesian Engineers.
Mulya questioned the independence of Bapepam in carrying out its responsibilities. "That's the power structure in our country. And we have to be satisfied with this situation," he said.
Bapepam is affiliated to the Ministry of Finance, and thus the Bapepam chairman is responsible directly to the minister of finance.
Mulya said the obligations given to Bapepam are in articles 5, 101 and 102 of the stock exchange law.
The law was approved by the House of Representatives early last week and is expected to come into affect early next year.
Under article 5 of the stock market law, Bapepam has special rights in licensing and giving approvals to all institutions and professions related to stock markets.
Article 101 empowers Bapepam to investigate any publicly- listed company if it is believed that the company is or has been engaged in stock market-related crime.
Article 102 authorizes Bapepam to impose administrative sanctions on any public company which is convicted of breaching any existing stock market rules. The sanctions range from written warnings to license revocations.
Mulya questioned Bapepam's right to intervene in the affairs of a publicly-listed company as a legal entity because, under Indonesian company law, the management of such a company is answerable to the shareholders, not to Bapepam.
The relevant law, on limited liability companies, has also been endorsed by the House and is expected to come into effect early next year.
Applause
Differing with Mulya, Jan Hoesada of the University of Indonesia applauded the new law, saying that Bapepam needs to act quickly to protect the interest of the investors.
"It takes a lot of time and energy to settle a dispute in court. In view of this, I'm of the opinion that it is right to give power to Bapepam to conduct its own investigations and then impose penalties on any company which is convicted of breaching the law," Jan said.
He said that, legally, a specific law prevails over a general law: lex specialis derogat lex generalis.
"The limited liability law is lex generalis in nature, while this stock exchange law is lex specialis. Thus, the limited liability law cannot affect the operation of the stock exchange law," he said.
On the same occasion, I Putu Gede Ary Suta, who replaced Bacelius Ruru last week as chairman of the Bapepam, said the special rights given to the agency are to protect the interests of investors.
Meanwhile, Director General of Taxes Fuad Bawazier, who is also chairman of the Jakarta Chapter of the Indonesian Engineers Association, called on all parties yesterday not to find loopholes in the new stock exchange law.
"The House of Representatives has approved the law. Thus, it is not the right time to look for the loopholes. Instead, we have to make contributions to the law.
Responding to Fuad, Mulya said he agreed with Fuad's suggestion. "Of course, I welcome this stock market law because, together with the limited liability law, this ruling serves as a milestone in our country's legal history." (rid)