ICC Decides PT Aero Citra Kargo is in Violation of Law 5/99.

Jakarta (9/6) – Indonesia Competition Commission (ICC) has decided that PT Aero Citra Kargo (PT ACK) is legally and convincingly proven to have violated Article 17 of Law Number 5 of 1999 as read out in a Panel Hearing for the Reading Out of the Decision on Case No. 04/KPPU-I/2021 today at the Head Office of ICC in Jakarta.

This case had its origin from the result of study and was followed up to the Commission Panel Hearing stage for the Alleged Violation of Article 17 of Law No. 5/99 with regard to the Freight Forwarding Services for the Shipment (Export) of Non-Pigmented Baby Lobsters (BBL) conducted by PT ACK. The Commission Panel in its Panel Hearing proceedings found that PT ACK constituted the only company present in the dissemination meeting, hence, there were no substitute companies of freight forwarding services for the release (export) of Non-Pigmented Baby Lobsters for destinations outside the territory of Indonesia. The facts of the hearings have also shown the existence of entry barriers as follows:

1. Decision of the Director General of Capture Fisheries (Kep-DJPT) Number 48 of 2020 in conjunction with (jo.) Decision of the Head of Agency for Fish Quarantine, Quality Control, and Security of Fishery Products (BKIPM) Number 41 of 2020 regulates that the requirements for exporting Non-Pigmented Baby Lobsters from the territory of the Republic of Indonesia viz., the necessity of possessing a Release Time Stipulation Letter (SPWP) document issued by the Director General of Capture Fisheries of the Ministry of Maritime Affairs and Fisheries (KKP);
2. The fact is that only PT ACK can administer the SPWP document as one of the requirements for releasing/exporting Non-Pigmented Baby Lobsters and this is supported by witness statements; and
3. There is an entry barrier for exporting companies if they do not possess the SPWP document to export Non-Pigmented Baby Lobsters to destinations outside the territory of the Republic of Indonesia.

Other facts disclosed in the hearings are pertaining to the market control of more than 50% as follows:

1. PT ACK is the only Non-Pigmented Baby Lobsters exporting company at least as from the issuance of Regulation of the Minister of Maritime Affairs and Fisheries Number 12 of 2020 up to November 25, 2020,
2. The existence of the control of market share of Non-Pigmented Baby Lobsters exporting services of more than 50% based on the statements of exporters, if not using freight forwarding services belonging to the Reported Party, then the exports/shipments of Non-Pigmented Baby Lobsters cannot be executed, hence, the exporters do not have any other choices,
3. PT ACK controls a market share of more than 50% (fifty percent), consequently, it has a monopoly position in the freight forwarding services for Non-Pigmented Baby Lobsters release (export) by way of using air transportation for destinations outsite the territory of the Republic of Indonesia, such as, to Vietnam, Taiwan, and Hong Kong in the June – November 2020 period.

In addition to the above, the facts of the hearings have proved that there has been a concentration of economic power wherein there has been government support for the issuance of the Release Time Stipulation Letter document and the concentration of economic power by way of excessive price fixing.

Based on the aforementioned facts, the Commission Panel decided that PT ACK had been legally and convincingly proven to have violated Article 17 of Law No. 5 of 1999 with the calculation of penalty of 10% of the value of the sales of Non-Pigmented Baby Lobsters export services using air transportation for Vietnam, Hong Kong, and Taiwan destinations in the June – November 2020 period, in the amount of IDR7,658,111,880,- (seven billion six hundred and fifty eight million one hundred eleven thousand eight hundred and eighty  rupiah).

However, based on Ruling of the Central Jakarta District Court Number 28/Pid.Sus-TPK/2021/PN.Jkt.Pst., the bank account in the name of PT Aero Citrea Kargo as the Reported Party and the bank Account in the name of Mr. Amri as the President Director of PT ACK have been forfeited for the state, consequently, the Commission Panel regards PT ACK as not having the ability to pay for the penalty as calculated by the Commission Panel.

          The Commission Panel in its Decision recommends that the Commission should provide suggestions and considerations to:

1. The President of the Republic of Indonesia to instruct all the Ministries/Institutions to:
2. observe Law Number 5 of 1999 regarding the Prohibition of Monopolistic Practices and Unfair Business Competition in drafting regulations and/or policies;
3. consult and ask for the opinion of ICC before issuing economy-, business-, and trade-related regulations and/or policies.
4. The Ministry of Investment/Investment Coordinating Board (BKPM) to cancel the Identification Number of Doing Business (NIB) Number 9120302232765 issued on February 26, 2019 specifically in the field of Freight Forwarding Services (JPT).