Two Cents on Antitrust: What to Expect from the Job Creation Law of 2023

Indonesia enacted its first Antitrust Law in 1999 under Law No. 5 of 1999 regarding Antitrust (“1999 Antitrust Law”), and it has been long due since. In 2020, the Parliament passed Law No. 11 of 2020 of Job Creation (“2020 Omnibus Law”), which significantly changed multiple aspects of law, including antitrust. However, the Constitutional Court decided this 2020 Omnibus Law was conditionally unconstitutional. Subsequently, instead of making changes to the “conditions” required by the Constitutional Court, the Government pursued to issue the Government Regulation in lieu of the Law No. 2 of 2022 (PERPU No. 2 of 2022), which, in March 2023, the Parliament passed to become Law No. 6 of 2023 regarding Job Creation (“2023 Omnibus Law”).

Through the recently enacted 2023 Omnibus Law, the executive and legislative agreed to some antitrust law changes. To help business actors and investors to conduct and run their businesses in Indonesia, we list the essential and significant changes to consider:

I. Court and Procedures

1. Commercial Court (Pengadilan Niaga) is now the venue to appeal the KPPU’s (“the Commission”) decision (Article 44 ¶ 2 of the 2023 Omnibus Law). Consequently, business actors must follow commercial court procedures (Article 45 ¶ 3 of the 2023 Omnibus Law). Additionally, business actors have only 14 days to file an appeal. Although there are only a limited number of commercial courts in Indonesia, its Judges are supposedly knowledgeable in commercial activity to render a fair decision.
2. Following the 2020 Omnibus Law, the Government issued PP No. 44 of 2021, which explains in more detail the changes in the law regarding antitrust in the 2020 Omnibus Law.
3. Supreme Court also created its procedural rules in PERMA No. 3 of 2021 (procedures to appeal from Commercial Court) to replace PERMA No. 3 of 2019 (procedures to appeal from District Court).
4. At the status quo, following the Constitutional Court decision and the newly enacted Omnibus Law of 2023, then PP No. 44 of 2021 and PERMA No. 3 of 2021 are no longer in effect.
5. Since the law regarding antitrust in the newly enacted Omnibus Law of 2023 is close to no significant changes in comparison to the Omnibus Law of 2020, then we should expect in the foreseeable future that both the Government and the Supreme Court will deliver their rules and regulation that should be pretty similar to PP No. 44 of 2021 and PERMA No. 3 of 2021.

II. Sanctions

1. Administrative
   1. Termination of a Business
      The 1999 Antitrust Law vaguely tells which violation falls under the “termination of business” sanction. Fortunately, Article 118 of the 2023 Omnibus Law clarifies by changing Article 47 of the 1999 Antitrust Law to include violation of Articles 17—24 and 26—27.
   2. Fines (47(2)(g))
      1. The 2023 Omnibus Law provides the bottom limit of fines that could be imposed on business actors, yet it removes the maximum limit of such fines that could be imposed on violators.
      2. Under the 2023 Omnibus Law, the minimum fine is Rp1.000.000.000,00 (One billion rupiah).
      3. In the foreseeable future, we should expect the Government to deliver a regulation to elaborate the criteria and method of calculating and imposing the fine on business actors. This way, it would be transparent and fair for business actors.
2.  Criminal
   1. Sanctions regarding Antitrust Law under the 2023 Omnibus Law regime focused more on the administrative than the criminal one.
   2. Under the 2023 Omnibus Law, business actors could be penalized under Article 41 of the 1999 Antitrust Law, which is a  maximum fine of Rp5.000.000.000,00 (five billion rupiahs) or a maximum of one year of jail time in lieu of the fine penalty.
   3. Under Article 41 of the 1999 Antitrust Law, only business actors who are not cooperating in an examination or investigation could be penalized. Actions that could be penalized, such as: refusing examination, refusing to provide information on investigation or examination, impeding investigation or examination process, and refusing to implement the Commission’s decision.
   4. 2023 Job Creation Law removed additional penalties on the 1999 Antitrust Law.

With these significant and continuing changes in the 1999 Antitrust Law and its subsequent implementing regulations, it is prudent for business actors to thoroughly prepare their businesses to run in accordance with the applicable laws and regulations.

Need legal assistance? Contact us through email at office@ maulanalawfirm. com