COVID-19 Pandemic: KPPU Relaxes the Supervision and Law Enforcement in Competition Law Regime

Marshall SitumorangFounder and Partner, Nusantara Legal Partnership

On 9 November 2020, the Business Competition Supervisory/Komisi Pengawas Persaingan Usaha (“KPPU”) promulgates a new regulation that provides several relaxations on the law enforcement of the competition law regime (“Relaxation”). This regulation is endeavored to boost national economic recovery and to implement the provisions established under Law No. 2 of 2020 on the Promulgation of Regulation of Government in Lieu of Law No. 1 of 2020.

Legal Frameworks: Our below executive summary refers to the KPPU Regulation No. 3 of 2020 on the Relaxation of Law Enforcement of Monopolistic Practices, Unfair Business Competition, and Supervision of Partnership Arrangement in order to Support the National Economic Recovery Program (“KPPU Reg 3/2020”).

Main Keys on the Relaxation on the Supervision and Law Enforcement in Competition Law Regime: We have managed to provide you the following main keys regarding certain relaxations on the supervision and law enforcement in the competition law regime.

Requirements of the Relaxations: We note that KPPU has implemented Relaxation to the procurement of goods and/or services funded by state or regional budget that is used for the following purposes only (Art. 5 (2) of KPPU Reg 3/2020):

  1. Procurements of medical equipment and/or supporting facilities with respect to the handling of COVID-19 such as in the form of: (i) medicines and vaccines, (ii) establishment of emergency hospitals, (iii) Appropriating of hotels or buildings to be used as patient isolation accommodation.
  2. Other procurements in order to provide social support and government social safety nets for the general public.

Scope of Relaxation: In the COVID-19 period, KPPU provides Relaxation with details in the below table.

Scope of Relaxation

Remark

Arrangement plans, activities, and/or dominant positions with respect to the handling of the COVID-19 pandemic.

  • Businesses shall submit a written application for this relaxation (“Application”) that is addressed to the Commission CQ. Deputy of Law Enforcement, either through KPPU official email, komisi@kppu.go.id, or directly to the KPPU office building (Art. 6 (2) and (4) of KPPU Reg 3/2020).
  • KPPU will thereafter respond to such Application in the following form: (i) giving permissions with/or without certain requirements, or (ii) reject such application (Art. 6 (3) of KPPU Reg 3/2020).

Delays in submission of notifications related to mergers, consolidation and share, and/or asset acquisition (“Corporate Actions”).

KPPU extends the deadline for the submission of Corporate Actions notifications until 60 (sixty) business days since such Corporate Actions comes into force (Art. 7 of KPPU Reg 3/2020).

Supervision of partnership arrangements.

KPPU extends the period of each writing reprimand for any violation of partnership arrangement to be 30 (thirty) business days (Art. 8 of KPPU Reg 3/2020).

We further note that any actions as referred to in the above table which have been submitted prior to the 9 November 2020 yet have not progressed to KPPU panel hearing, will be dealt with the regulation that provides greater benefits to the relevant business (Art. 10 of KPPU Reg 3/2020).

Procedure for the Granting of Relaxation: KPPU will examine the submitted Application in a coordination meeting at the latest of 7 (seven) business days after its submission (Art. 9 (1) of KPPU Reg 3/2020).

Please note that KPPU will issue its decision on the Application within 14 (fourteen) business days. If such period is exceeded, then the Application shall be regarded rejected by the KPPU (Art. 9 (3) and (4) of KPPU Reg. 3/2020).