On 3 November, the Commission for Supervision of Business Competition (KKPU) has ruled that PT Carefour Indonesia violated the Anti Monopoly Law year 1999 when it acquired 79% share in local retail company PT. Alfa Retailindo in 2007.KPPU claimed that the acquisition gave Carrefour a 58% share in the national retail market, therefore against said law. Carrefour was fined Rp 25 billion ($2.6 million) and ordered it to sell its shares in Alfa.
Carrefour rejected said ruling, arguing that its methodology was flawed. Carrefour's official cited an AC Nielsen survey that says the Alfa acquisition only raised Carrefour’s share of the retail market to 17%. He added that KPPU’s ruling was not right and could have an impact on the investment climate and legal certainty, which has been quite conducive in recent years. Due to which it has appealed the ruling to the South Jakarta District Court.
Meanwhile, CEO of the Carrefour Group in France Lars Olofsson has met with President Soesilo Bambang Yudoyono (SBY) on 14 December when SBY stopped in Paris on his way to the UN Climate Change Conference in Copenhagen. According to a director of PT Carrefour Indonesia, Olofsson has asked SBY about KPPU's ruling.
Chairman of KPPU Benny Pasaribu said that the meeting was improper because Carrefour is having a dispute with KPPU.
But SBY's spokesman Julian Pasha explained that SBY met Olofsson during a gathering with businessmen of the French Chamber of Commerce in which Carrefour is a member.
The above KPPU's ruling was questioned by a lawyer specializing in merger and acquisition who said that Carrefour's acquisition of Alfa was right because it has been approved by the Capital Market and Financial Institutions Supervisory Agency (Bapepam-LK) and the Indonesian Investment Coordinating Board (BKPM).
For details on the above, please click here, here, here, here, here, here and here.
Considering that the settlement of this case will consider the fact that Carrefour's acquisition of Alfa has previously been approved by two government agencies.
I also hope that the impact of said acquisition on the market would be re-examined once again so that the truth shall be known. That way, legal certainty can be preserved, and new investors would not hesitate to invest their money in Indonesia.
Image : Courtesy of Wikipedia.
4 comments:
A company got fined by the proper institution( a lousy € 1.8 by the way) for breach of monopoly laws.
The company appealed. Which is the usual way if one thinks one has a case.
And now we'll wait for the outcome.
So far, so good.
And what about SBY meeting some lobbying Carrefour megaboss in the fringes of a meeting with French businessmen? Well, that's part of the real world - in his turn SBY will have been lobbying here in the interest of RI, I guess.
Nothing wrong with that either.
As far as we know the president has not been caught meddling with the procedures or the appeal court on behalf of Carrefour.
So, why worry?
Colson,
The problem lies in implementation by different government agencies which lacks harmony.
PT Alfa Retailindo Tbk (terbuka) is a public company therefore sales of its shares should be approved first by the Bapepam. While PT Carrefour Indonesia is a foreign investment co. therefore before buying Alfa's share should obtain BKPM's approval first.
If Carrefour's purchase violated the law how come both agencies gave their approval? Why didn't they check first?
And why didn't KPPU rejected much earlier.
Beside that there's also question of Carrefour's market share after taking Alfa, KPPU said 58% while surveyor AC Nielsen said only 17%
@Harry:
Thanks for your explanation.
Colson,
Most welcome.
I always enjoyed discussions with you
Post a Comment