Some Notes On the Development of Competition Law and Policy in Indonesia Dr. Syamsul Maarif Justice, Indonesian Supreme Court Bali, 15 November 2011

CHALLENGES AHEAD Enforcement DEVELOPMENT 2 Institution

1. Overview on Indonesian competition law 3

The Adoption of General Competition Act 4 Economic crisis in 1998 lead to massive reforms in Indonesia Three main areas of reforms: Public Election, anti- Corruption, and Competition In1999, General Competition Act is adopted In 2000, KPPU is established

The Law n. 5/ Oligopoly; Price Fixing; RPM; Market Division Boycott; Cartel; Trust; Oligopsony; Vertical Integration; Exclusive Dealing; Agreement with Foreign Parties Art ABUSE OF DOMINANT POSITION Art PROHIBITED ACTIVITIES Art PROHIBITED AGREEMENT Monopoly; Monopsony; Market Control; Predatory Pricing; Bid Rigging; Conspiracy Abuse of Dominant Position; Interlocking Directorate; Cross Ownerships; M & A

2. Institution 6

Staffing 7 Number of staffs increased due to observed demand and available fund. To date, we accounted for 420 staffs work for KPPU (nation wide), where 108 of which are investigators. Number of staff

Budget 8 The main KPPU’s budget comes from the state budget. KPPU’s budget is increased 2.500% within 11 years In billion rupiahs.

Performances (cont.) 9 Number of Complaints and Decisions

Issued 97 advices and recommendations in ten years (thirteen of which are in 2010) Last year recommendation involved with several strategic sector such sugar, rattan, steel, water, transportation, and electricity. Number of Policy Advices 10

Recommendations by Sector 11

Effective Rate for Advocacy 12 Policy change is fluctuated shows dynamic response of Government Position toward policy recommendation Policy Recommendations until June 2011 Total : 89 Year 2011 (june) : 4 Average in a Year : 8 Effective rate: 44 %

13 3. Enforcement Time to settle competition cases Quality of KPPU judgment Fines and damages MoU with other agencies

THE CHALLENGES AHEAD 14  Regulatory Environment  Legal System  Level of Economic Development

Other Challenges 15 Challenges Undefined status Low budget Large area Less authority Low public awareness Low government acceptance Institutional Enforcement Advocacy Limited time Data reliability

Challenges in enforcement 16 Indonesia is the biggest archipelago country in the world (17,508 islands). The law on autonomy and law on local government gave authority to the local government to develop its own territory, except for certain tasks such foreign politic, defense, national monetary, and religion. These potentially cause different economic policies amongst locals, and thus will create different challenges in enforcing competition law and policy. Representative offices act as the extension of main office to promote competition law and policy to locals, received complaints, and conduct research on local policies. Cases are handled by the main office, but the examination process might be conducted in the region.

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