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Indonesia – Competition Updates.

10 December, 2013

 


KPPU Signs Memorandum Of Understanding (“MOU”) With Manado Sam Ratulangi University


The KPPU announced on 16 September 2013 that it had signed an MOU with the Manado Sam Ratulangi University in Manado, North Sulawesi, Indonesia. This was part of the KPPU’s efforts to increase the scope of cooperation between education, advocacy and enforcement of competition laws in Indonesia.


On Going Cartel Investigations


In view of ever increasing food prices, KPPU initiated cartel investigations in relation to food products such as beef, garlic and soybean. As of September 2013, the investigation in the soybean industry was still at the information gathering phase. The investigation seeks to identify whether the highest soybean price in history was due to cartel behaviour or otherwise. Separately, 6 out of 9 beef companies have allegedly been involved in a beef cartel while 19 garlic importers are investigated for their alleged participation in a garlic cartel.


KPPU And Minister Of Health Hand In Hand To Reduce The Increasing Health Cost


On 22 November 2013 Nawir Messi, Chairman of KPPU, visited the Minister of Health, Nafsiah Mboi, to address certain medical practices that may impact competition in the health care sector in Indonesia. In particular, the fact that a doctor should not endorse a specific branded medicine and how inter-brand competition amongst various medicine brands can be best preserved were discussed. Separately, Nawir Messi in his visit also stated that the implementation of Social Security Program by the BPJS (Social Security Implementing Body) and the practices of other types of health care service providers may in some instances impact competition, and therefore become of concern to KPPU as well.


The visit and concern addressed were kindly welcome as both the KPPU and MoH share the same vision of making the health care services along with medicines more affordable to citizens. In 2010, post the amlodipine cartel case investigation involving Pfizer, KPPU recommended the upper limit price of branded generic drugs to be not more than thrice the average price of the generic drugs containing the same active ingredient(s).


With regards to the healthcare sector, KPPU is currently investigating the potential anticompetitive effect resulting from the vertical integration between an Indonesian major pharmacy company and another Indonesian well-established maternity hospital network.


KPPU’s Agenda To Amend The Indonesian Competition Law


The move of KPPU to amend the Indonesian Competition Law (“ICL”) has been long awaited by the practitioners and academicians. The power of KPPU to perform dawn raids, search and seizure, and the existence of leniency program are some of the important items on the KPPU’s agenda. The change of a mandatory post-merger notification system to a mandatory pre-merger notification system would also provide more legal certainty to corporate deals. This would be welcome as the number of post-merger notifications reached 141 (with 20 of them being foreign mergers) since the merger control regime was implemented in 2010.

 

 

For further information, please contact:

 

Yogi Sudrajat Marsono, Partner, Assegaf Hamzah & Partners

yogi.marsono@aph.co.id
 
Eri Hertiawan, Partner, Assegaf Hamzah & Partners

eri.hertiawan@aph.co.id

 

Rikrik Rizkiyana, Partner, Assegaf Hamzah & Partners

rikrik.rizkiyana@aph.co.id

 

Vovo Iswanto, Partner, Assegaf Hamzah & Partners

vovo.iswanto@aph.co.id

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