Thu, 01 Oct 1998

Two more bankruptcy claims filed in court

JAKARTA (JP): Publicly listed Bank Niaga and business partners Hussein and Johan Subekti are the latest parties to make use of the month-old Jakarta Commercial Court, already under intense scrutiny after several controversial decisions.

Bank Niaga filed a claim on Sept. 23 against PT Bajamarga for the latter's failure to repay its letter of credit facility of Rp 170.3 billion, according to court official Tri Widodo.

Hussein and Johan jointly filed suit against PT Modern Realty, a publicly listed property company, on Sept. 24 to recover their down payment of Rp 1 billion to the company.

Their cases are the seventh and eighth since the implementation of the country's bankruptcy law late last month.

A court official said on Wednesday that Bank Niaga's cases was first filed on Sept. 23 and the Hussein's case on Sept. 24.

"The first hearing for Bank Niaga is scheduled for Oct. 5 while Hussein's will be on Oct. 7," Tri said.

On Wednesday, the court approved the request by PT Ometraco Multi Artha (OMA), a subsidiary of PT Ometraco Corporation, to temporarily suspend the payment of its US$125 million loan owed to a group of local and overseas banks coordinated by the Singapore branch of American Express Bank.

Presiding Judge Haryono, who chaired Wednesday's hearing, also appointed Victor Hutabarat to be the supervisory judge and William E. Daniel of Warrens & Achryar as the administrator to protect the debtor's assets during the temporary payment suspension period.

The new law allows Indonesian debt-ridden companies to file for a suspension of payment. Under this procedure, the court issues a temporary payment suspension during which time the debtor and creditors can work out a debt reorganization plan.

The troubled firms will be given 270 days (including the 45 day temporary suspension) to decide on a negotiation plan with their creditors. Failure to reach a settlement will result in bankruptcy proceedings.

The court on Wednesday granted a 0.5 percent commission fee to the appointed administrator of Ometraco's assets. The fee is much lower than the 3 percent ceiling ruled by the Ministry of Justice last week.

The amount of commission fee for the administrators, who will be in charge of the debtor's assets during the payment suspension period, sparked controversy last week following the court decision to demand golf course developer PT Karabha Digdaya pay a 5 percent commission fee on its total assets of Rp 1.3 trillion to the administrator.

The total commission works out to be four times higher than the company actually owed to the plaintiff. (aly)