Jakarta (28/9) – Indonesia Competition Commission (ICC) decides that PT Suryabumi Tunggal Perkasa (PT STP) has legally and convincingly violated Article 35 Paragraph (1) of Law Number 20 of 2008 regarding Micro, Small, and Medium Enterprises. For that purpose, ICC has ordered PT STP to meet the 20%-Plasma land obligation if it gets land for the release of forest areas or other use areas from the government as well as improving the transparency mechanisms with regard to financial statement and the preparation of monthly work plans as well as the evaluation of their implementation engaging Koperasi Perkebunan Tri Hampang Bersatu (Perkebunan Tri Hampang Bersatu Cooperative [Koperasi THB/THB Cooperative]). The decision was read out by ICC in its Panel Hearing for the Reading Out of Decision on Case No. 03/KPPU-K/2021 at the ICC Head Office Jakarta yesterday.

This case had its origin from a report on the alleged violation of partnership on April 14, 2021 in the implementation of the partnership committed by PT STP (as the core) against its partner Koperasi THB (as the plasma). The process continued up to the preliminary examination stage, where 3 (three) written warnings were given, along with an order for improvement of the partnership. However, PT STP did not execute all the orders for improvement. It only executed one of the orders for improvement, namely with regard to the clauses of rights and obligations as well as the form of the development in the agreement by offering jobs as well as administering training and development engaging the related agencies to the members of THB Cooperative. Other orders for improvement such as the obligation to build 20% of the plasma land, transparency in the financial management and plasma plantation management, as well as amendment to clauses in the agreement were not executed. The case then continued to the the Commission Panel Hearing stage.

The Commission Panel found in the hearings that PT STP had a landholding obligation of 948.42 hectares (i.e., 20% of the 4,742.14 hectares of land as cultivated by PT STP). However, THB Cooperative has merely received a land area of 790.1 hectares, hence, there is still a dearth of land that should be given by PT STP to THB Cooperative of 158.32 hectares. Based on laws and regulations, the non-fulfillment of the obligation to fulfill the 20% of the provision of the cultivated land to the plasma can be declared as an action of legal control over the business activities conducted against micro, small, and medium enterprises being partners. However, based on the information obtained during the hearings that the cause of the dearth is because PT STP has yet to obtain the approval for the release of forest area land from the government, viz. the Ministry of Environment and Forestry or other land use areas.

The Commission Panel also judges that PT STP is in need of better and more intensive communications to THB Cooperative as the plasma representative, in the engagement during the preparation of profit and loss statement, regular monthly work plans, or the report on the remaining business proceeds to the plasma. The Commission Panel also judges that the clauses in the partnership agreement have granted adequate opportunity to Plasma to obtain jobs by meeting certain requirements.

Based on the facts of the hearings, the Commission Panel declares that PT STP has been legally and convincingly proven to have violated Article 35 Paragraph (1) of Law Number 20 of 2008 regarding Micro, Small, and Medium Enterprises. The Commission Panel takes into account that in view of the obligation to fulfill 20% of the land to Plasma has yet to be fulfilled due to the constraints with the process of releasing forest areas or land for other uses, PT STP is not subject to penalties. The Commission Panel has ordered PT STP to fulfill the 20% obligation of the plasma land if it obtains land for the release of forest areas or other use areas and ordered PT STP to improve the transparency mechanisms with regard to the financial statement and the preparation of monthly work plans as well as evaluation of their implementation by engaging THB Cooperative, as the sanction. Report on the progress of the implementation of the sanctions is ordered to be conveyed every 6 (six) months to ICC cq. the Directorate of Partnership Oversight, as from the acceptance of the Excerpt and Copy of the Decision up to the execution of the Decision by PT STP.