Outlook of the Investigations of Cases and M&A Notifications of ICC During Year 2019 and the 2020 Fiscal Year Budget Projection of ICC.

Friday, March 27, 2020

ICC described an achievement report on the merger and acquisition notification activities in 2019 as well as budget projection  of ICC in 2020. This was conveyed in a journalist forum held at ICC, Jakarta.

Present in the said journalist forum explaining the intended complaint and achievement was ICC Member, Guntur S. Saragih, flanked by Director of Merger and Acquisition (M&A), Daniel Agustino, Director of Investigation, Gopprera Panggabean, as well as Head of Planning and Finance Bureau, Andi Zubaida Assaf.

Daniel explained that there were 101 notification actions being conveyed to ICC in 2019. Out of such number, there were 94 acquisition notifications, 3 merger notifications, and 4 consulting notifications being recorded. Subsequently, based on such notifications, it was found out that 68 actions were committed by the local business actors among themselves, 13 actions were committed by foreign business actors against local business actors, 18 actions were committed by foreign business actors among themselves, and 2 actions were committed by local business actors against foreign business actors.

In addition to the above, the business activity sectors in the merger and acquisition transactions reported to ICC are among other things:

  • 20 notifications in the sectors of energy, mining, and excavation,
  • 10 notifications in the sectors of construction, property, and tourism industries,
  • 16 notifications in the sectors of banking and non-bank financial service industries,
  • 11 notifications in the sectors of electronic, information, and communications industries,
  • 30 notifications in the sector of processing industry,
  • 6 notifications in the sectors of transportation and logistics industries,
  • 6 notifications in the sectors of agricultural, plantations, and animal husbandry industries,
  • 2 notifications in the sectors of retail industries of food and beverage.

There has been a merger and acquisition notification development trend being reported to ICC in the last 2 years. There were 78 notifications being reported in 2018 and the number increased to 101 notifications in 2019.

While in terms of budget, Zubaida explained that by virtue of Letter of the Minister of Finance Number S-704/MK.02/2019 dated September 26, 2019, the Ceiling of the Budget Allocation of ICC for the 2020 Fiscal Year for Business Competition Supervision Programs was IDR130,338,589,000. This figure shows a decrease as compared to that of the 2019 Fiscal Year amounting to IDR136,631,030,000 with an absorption achievement percentage of 97%.

Guntur conveyed that in this regard, ICC bears a fairly strenuous burden given the decreased budget value while the economic growth keeps on improving in 2020. In addition, ICC also has a new duty especially in terms of partnership supervision that requires a special attention. As conveyed before that in 2020 ICC has 14 focuses of activity allocations, namely:

  1. Business Competition Monitoring and Assessment,
  2. Government Policy Analysis,
  3. Advocacy of Business Competition and Partnership,
  4. Investigation of Alleged Violations of Unfair Business Competition,
  5. Enforcement of Violations of Unfair Business Competition,
  6. Assessment of Mergers and Acquisitions,
  7. Partnership Supervision,
  8. Handling of Cases of Business Competition Violations,
  9. Supervision of Business Competition in the Work Regions of the Regional Offices of ICC,
  10. Administration of Legal Aid and Execution,
  11. Management Support and Implementation of Technical Duties of ICC,
  12. Budget Planning and Implementation of ICC,
  13. Administration of Institutional Communications,
  14. Supervision of Accountability and State Apparatuses of the Commission for the Supervision of Business Competition.

However, the decreased amount of budget for year 2020 does not serve as a ground for ICC to reduce or lower its performance. In its reality, the standing firm employees to date express their loyalty and sincerity.

In the last part of his explanation, Gopprera also co-explained the report on several data achievements at the Directorate of Investigation during year 2019 the number of which was deemed as increasing. There were 71 investigation activities being recorded in that year (67 investigations in 2018), 151 report clarifications (132 reports in 2018), and 47 initiative studies (38 initiatives in 2018).

The sources of ICC cases can derive from initiatives and reports received and the processes thereof must first go through a study phase before being lifted to pre-investigation, investigation, and dossiers preparation so as to be eligible to be declared as a case. It has also been conveyed that there are 15 cases underway hitherto, wherein 12 cases concern mergers and the rest concern alleged discrimination by Grab, alleged airline ticket cartel, and tender case of PDAM Lampung (Lampung Regional Drinking Water Company).