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28 February, 2018
In an entirely unexpected development, Indonesia’s competition authority, the Competition Supervisory Commission (“KPPU”), has announced that it has been forced to suspend many of its key operations due to the emergence of a legal vacuum resulting from the simultaneous expiry of the terms of office of all of its commissioners on Feb 27 — in reality, their terms expired on Dec 27 but were extended by President Jokowi for a period of two months. The suspension of operations was announced on the KPPU Website on the very same day as that extension came to an end, with the commission stating that as a result of the legal vacuum that had arisen, the following operations would be suspended, effective Feb 28:
- KPPU hearings and merger-notification appraisals;
- All operations and actions requiring the direct involvement of KPPU commissioners; and
- Litigation proceedings at the District and Supreme Court levels where powers of attorney need to be granted by the KPPU chairman, commencing Feb 28.
The KPPU announcement further stated that the suspension of operations would continue until such time as a new board of commissioners had been appointed, or the mandates of the existing board members had been extended (for a second time).
Meanwhile, Kompas.com reported on Feb 28 that President Jokowi has now, in fact, extended the commissioners’ terms of office for a further period of two months up to April 27. Thus, there should be nothing to stop the KPPU from quickly resuming operations. However, the suspension announcement was still posted on the KPPU Website as of the time of publication.
According to The Jakarta Globe daily (Feb 28), the legal hiatus at the KPPU could be due to a mix-up, whereby the speaker of the House of Representatives (“DPR”) may have neglected to forward a letter from the DPR requesting the President to extend the terms of office of the commissioners for a second time. Whatever the reason, it is to be hoped that there will be no reoccurrence of this unfortunate development, given its potentially adverse impact on business planning and legal certainty.
For further information, please contact:
Gustaaf Reerink, Ali Budiardjo Nugroho Reksodiputro (ABNR)
greerink@abnrlaw.com
