Wake-up call for KPPU before it is too late

Ignatius Andy, Lawyer, Jakarta

The South Jakarta District Court will announce on Thursday its ruling on the appeal filed by five parties against the Business Competition Supervisory Commission (KPPU)'s decision in the Indomobil case. Whichever way the court decides it will stir up even more controversy.

The Central and West Jakarta district courts earlier ruled against the KPPU, and there seems to be a concerted attempt to attribute these decisions to the gross incompetency or corruption of the judges. As a result, the KPPU has threatened to initiate an investigation into the judges or report them to the Ministry of Justice and Human Rights.

It would be a sad day for justice in Indonesia if this line of thinking was accepted. The judiciary may be imperfect, as lots of people have complained, but there is always the possibility that Indonesian courts are still capable of issuing rulings that are well-reasoned and supported by the facts and strong evidence.

Succumbing to generalizations about the imperfect courts is not only succumbing to intellectual laziness; it will also divert the public's attention from the real issue on trial in this case: the caliber of the KPPU's investigation processes, and therefore the quality of the KPPU's decisions themselves.

The writer cannot speak about the merits of the other cases, but can discuss the Central Jakarta District Court's ruling on Deloitte & Touche FAS (DT-FAS). In this case, any reasonable person would have to conclude that the panel of judges arrived at a sound decision, after carefully reviewing about 200 pages of legal arguments that were supported by statements from expert witnesses, as well as thousands of pages of documents submitted as evidence.

The reasons behind the judges' ruling were also convincing. DT-FAS' appeal, among other things, proved that the KPPU had never investigated DT-FAS in its capacity as a defendant, which is against the antimonopoly law; that the KPPU did not give DT- FAS the proper opportunity to present its case and failed to respect the due process of the law; and that the KPPU had mistakenly defined DT-FAS as a seller in the Indomobil sale when it fact it was a consultant.

For reasons known only to themselves, the KPPU's professional legal team chose -- and this was noted by the panel of judges in the DT-FAS decision -- not to contest any of DT-FAS's objections. This is significant because the KPPU was in effect not refuting the truth of these objections.

The panel of judges, however, did not base their decision solely on this novel defense strategy of the KPPU. They also considered other evidence, and their conclusion was that the KPPU essentially acted in a way which denied DT-FAS an opportunity to present its case. The panel also said that all of the KPPU's findings in its decision against DT-FAS were based on the mistaken fact that DT-FAS was a seller, and that DT-FAS could not be held responsible for the acts of the seller.

It is clear from this ruling that the KPPU's decisions were based on false assumptions. It is also clear that its procedures were arbitrary and lax. All this contributed to a decision that could not stand up to scrutiny in a court of law.

This being the case, the KPPU should treat the court's decision as a wake-up call to improve itself instead of resorting to threats and intimidation against the judiciary. It needs to do this because at the end of the day, Indonesia badly needs an effective KPPU. The question is: what kind of KPPU?

We have labored for 32 years under a regime that is rife with unhealthy business practices. We need an institution to right the wrongs and create a level playing field for healthy business competition.

The only way the KPPU can do this is by tightening its procedures so that all businesses can know for certain where the line in the sand is, as far as business practices are concerned. They also need to have confidence that as an institution the KPPU will not resort to its current practices, which have been marked by a tendency to change legal definitions in the name of expediency and an attitude that righteousness is enough to overcome the need for due process, principles of fairness and equal treatment.

The KPPU can rise to this challenge by demonstrating in its actions that it (i) respects the prevailing Indonesian laws and regulations, especially the antimonopoly law, (ii) respects the due process of the law and (iii) is being careful in its fact- finding and decision-making processes. The absence of this would only prejudice the quality and integrity of any KPPU action or decision.

We can only hope that the KPPU rises to this challenge, for the future of healthy business competition, and therefore the nation's economic recovery, is at stake here.