Omnibus Law: Recent Development on Indonesian Competition Law

 

After waiting for three months since the enactment of Law No.11 of 2020 on Job Creation (known as, the Omnibus Law), on 2 February 2021, the Government finally issued regulation No.44 of 2021 on Implementing Regulation on Prohibition of Monopolistic and Unfair Business Competition Practices (GR 44/2021). 

The issuance of GR 44/2021 is along with more than forty other government regulations and presidential regulations that have been changed under the Omnibus Law.

As we may already aware, the Omnibus Law has changed several provisions under the Competition Law.  GR 44/2021 is expected to be the answer and provide clarity on these changes. 

Set out below significant changes made under GR 44/2021, for your reference:

1.    Revocation of maximum administrative fine

The administrative fine is now calculated maximum up to 50% of the nett profit or 10% of the total turnover, both are calculated from the relevant market and during the period of violation of the Business.

Further, GR 44/2021 stipulates that the determination of fine will be based on:

a.    negative impact caused by the violation;

b.    duration of violation;

c.     mitigating factors;

d.    aggravating factors; and/or

e.    ability to pay the fine.

2.    Objection to KPPU decision is now channeled to the Commercial Court

The Omnibus Law clearly shifts the objection against KPPU decision from the district court to the commercial court.  Further, GR 44/2021 stipulates that the examination objection period ranging from 3 to 12 months.

The objection must be registered within the relevant commercial court no later than 14 business days, after the Business received notification of KPPU decision or otherwise, it will be final and binding.

3.    Paying bank guarantee if the Business objects to KPPU decision

If the Business intends to challenge KPPU decision, they must pay a bank guarantee to the bank amounting to 20% of the total fine within 14 business days after receiving the notification of KPPU decision.  However, this is not the case, if the Business is accepting KPPU decision.

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