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INDONESIAN LAW UPDATE 2008

[June 2008]

Temasek Sell all of its Shares in Indosat Cellular Provider to Qatar. Following the lost at the appeal court, Temasek of Singapore then sold all of its shares to Qatar Telecom. Temasek and its 8 subsidiaries has been found by KPPU for conducting unfair business through direct and indirect ownership and management at 2 major cellular provider in Indonesia, PT Indosat and PT Telkomsel.

Indonesia Anti Corruption Commission (KPK) Initiate Investigation at the Supreme Court. The warrant has been released to start the investigation at the Indonesian Supreme Court (equal to High Court at Common Law) in accordance to fees applied illegally and unreported to the state finance. There are Rp 31,1 billion (USD 300 million) revenue unreported, an income  paid by law seekers at all level of the Indonesian court during 2005-2007, according to the Indonesian Corruption Watch - an Indonesian NGO watchdog.

KPK initiate to Investigate State Loss at BP Migas. The total loss of the Central Government budget to the Local Government of Rp 225 trillion (USD 21 billion) is at Rp 25 trillion. The said de-consentration budget was paid to BP Migas, an independent authority in oil and as exploration and management which shares are fully owned by government. Previously, KPK also investigate state loss at 10 Departments, 11 State Enterprises and 1 Provincial Government, where a bigger number loss was found, where state properties has been awarded and illegally transferred into private properties by government officials during tenure. A number of lands and houses has been identified and confiscated, and the private personnel are now facing trial at the Anti Corruption Court.

Again, KPK arrested 5 staff at the Indonesian Custom Office. The 5 government staffs were found guilty for graft received from businessmen at Tanjung Priok Port, the major port in Jakarta. To respond this, Vice President Yusuf Kalla warned that each party must refrain from bribe, be it the businessmen, staff or higher level staffs. According to a construction businessmen, graft take almost 30% of the business in Indonesia, especially in dealing with the port authorities. They agree to start a 'zero tolerance to bribery'.

[May 2008]

Temasek of Singapore lost the Case against KPPU. The award by the Indonesian Business Competition Commission - KPPU penalized 9 of cellular telephone operators in Indonesia for monopoly through share ownership at a number of cellular providers in Indonesia. The 9 companies are Temasek Holdings Pte Ltd, Singapore Technology Telemedia Pte. Ltd,  STT Communications Ltd., Asia Mobile Holding Company Pte. Ltd, Indonesia Communications Limited, Indonesia Communications Pte, Singapore Telecommunications Ltd., and Singapore Telecom Mobile Pte. Ltd and PT Telkomsel. The KPPU award are that the 9 companies are found for breaching article 27 Law 5 year 1999 on Competition Law (for unfair competition), KPPU also ordered Temasek and its 8 subsidiaries to sell all of its shares at either PT Telkomsel or PT Indosat within 12 months, where prospective buyers must not have an afiliation with Temasek, and finally fines Temasek (and 8 subsidiaries) and PT Telkomsel to each pay fine of Rp15 billion. The Temasek then also found thier lost at the Appeal Court, where the award are tougher than the KPPU Award.

 

President Susilo Bambang Yudhoyono appoint Chairman for Institute for National Goods and Services Procurement. The said Institute under the National Development Body (Bappenas) will be staffed to continuously analyze, monitor and to secure the transparency and accountable government procurement. The institute and its appointment is drawn under the President Decision 34/M/2008, a complement to the previous President Decision 80/2003 of Government Goods and Services Procurement. The law has effectively curbed corruption, collusion and nepotism between government officer and brokers.

Indonesia Suggest the Implementation of UNCLOS 1982, remain.  This position was released from Indonesia, represented by the Indonesian Director General for Law and International Treaties of the Department of Foreign Affairs, in respond to the United Nations draft resolution to additional authority by the UN Security Council (UN SC) within the IMO authority to combat sea piracy at most archipelagic states, where territorial sea status may change into international sea,  which is in contrary to the United Nations Conference on the Law of the Sea 1982 (UNCLOS 1982) and United Nations Charter. The proposal will allow the UN SC warfare directly entering territorial sea without coastal state consent to combat sea pirates, where no coastal state jurisdiction applied. Indonesia suggested, that the UNCLOS 1982 shall remain, and the combat of sea piracy shall be left to the coastal state jurisdiction under the International Maritime Organization (IMO) as it used to, instead taken over by the UN SC. So far, the security over the Malacca Strait has successfully been controlled by Indonesia, Singapore and Malaysia, where sea piracy has been significantly reduced.

Poll 10 years of Reformation. Another national circulation news papers in Indonesia held its poll by 871 respondents from 6-7 May 2008, shows that generally 75% of respondents shows their great concern over the economy slow down since Reformation 1998. It is the government they blame to cut subsidies for foods, wheat flour, sugar, corn, fish in 1998, and soon to cut subsidy for premium and kerosene. Welfare State in terms of feeding people, lost its meanings when the government fails to secure its people from hunger and unemployment as shown by 50,5% respondents, while 19,7% are for legal supremacy failure and 16,5% for social and welfare failure. Nevertheless, still big numbers of respondents thank reformation for its freedom of speech and to unite. Further, 10 year Reformation 1998 shows positive responses for better security and politics (35,1%), law enforcement (17,7%), social and public access (14,5%), and economy (4,1%). Failure of reformation also shown, where government fails in economy (50,5%), law enforcement (19,7%), social and welfare (16,5%), politics and security (5,4%) and in general (2,1%). Generally respondents find pessimism for a better Indonesia in 5 years ahead (53,6%) pinpointing the unclear of national future plan (66,8%). The 4 amendment of the constitution and the strengthening of public institutions are merely normative, where politicians remain unaware to put great concern over the people. Regional autonomy brought local politics competition, instead of independency and growth for the people.

[April 2008]

Poll of 10 year of Reformation. The poll held by Demos, a research institute in human rights and democracy, shows a fundamental change reduce from 74% in 2004 to 66% in 2007 for freedom to embrace religion, language and culture, also a significant reduce from 74% in 2004 to 60% in 2006 for freedom of speech, to unite and to engage into an organization. This is as a result that democracy in Indonesia are viewed in various form, different paradigm of democracy by the people, and also that democracy find it obstacle from economy policies in terms of globalization. Therefore, a new rigid and solid policy in law and government must win over economy policy. However, significant progress is clearly shown by the actions towards new laws and regulations, significant corruption extermination, less abuse of powers by government officials, and the obedience of law by government officials and public officials.

Poll on Government Legal Officers. The poll held earlier in  March 2008 by 867 respondents at 13 major cities in Indonesia shows public disappointment towards legal officers performance these days, where 73,2% perceive no public service are free from corruption by its officers, legal officers in particular. The General Attorney’s Office and Police Institution received 95,4% and 73,4% respondents' distrust, respectively. Indonesian Anti Corruption (KPK) also receive 73,4%, following the arrest of its member (a police retiree) for a graft and blackmailing during a corruption investigation by a state enterprise, last February 2008. Again it is the General Attorney Office and Police Institution were those who did not commit to corruption extermination by 84,7% and 81,2% respectively, including the Supreme Court (75,3%), the Court  (82,2%), and KPK (67,2%). Almost half respondents (55,2%) do not trust the commitment to combat corruption in general in contrary to 42,7% who remain in trust. Of the image, General Attorneys good image increase from 29,3% up from 22,3% last year the same period. Even worse, 74,4% respondents distrust the court. It is now the public compel the renewal of new tougher bill of anti corruption, since they perceive the current laws and regulation is good since its inception in 1998, but did not sufficiently implemented. A new credible and accountable legal officer is a must.

Malaysian High Rank Officer involved in Illegal Logging. According to its investigation by an Indonesian  newspaper issued 9 April 2008, the said Malaysian person uses a Malaysian company Hardwood Timber SDN BHD in the process of disbursing papers to turn illegal into legal woods. The illegal woods are from Borneo, Indonesia, then exported to Malaysia through Indonesia-Malaysia borders. The Indonesian consulate officer in Kuching, Malaysia who witnessed the Malaysian importing papers, found it fake due to the use of wrong spelling of Bahasa Indonesia. However, Malaysian authority denied.
 

Poll on Member of the Parliament. The polls, generally shows significant perception, where 822 respondents (over 17 years of age at 10 big cities) low trust is shown for member' appearance during sessions (24% trust compared to 70,4% distrust), too much travel abroad than being at office (74,2% agree to 22,9% disagree), do not aware for people' criticism (69,2% to 27,4%) and always request additional facilities (agree 75,9%-disagree 22,4%).
 

Houses of Government  Asset valued at Rp371 trillion , missing. The said numbers are houses under government proprietary being reviewed, which big numbers has been transformed illegally into private proprietary, according to the calculation of the Directorate General for State Inventory of the Department of Finance, recently. KPK then seized at least 11 government-owned houses in Bandung, West Java, which has long been illegally transferred into private by the government officers for themselves. Other houses will follow. Of 77 department and government institutions, only 20 has conducted reviews of its assets since 2007.

[March 2008]


Malaysian Subsidiary Company in Media Content Accused for Unfair Trade Practices
. The Indonesian Fair Trade Competition - KPPU identified the Astro All Network Plc (Malaysia) - AAMN breached article 19 paragraph c of the Indonesian Competition Law. AAMN has intentionally through its business contract defined and limit distribution and trade of service and/or goods based on the initial investigation, where AAMN monopolized and took control the distribution of the said TV program during the England Football League 2007.


Government of Egypt: 40% anti dumping measure dropped to Indonesian Tire Products. The initial complaint in August 2006 then was reduces into “a slight margin of dumping by the Indonesian exporters” after the WTO agreements the allegation and tax was recently lifted. During the investigations period, Indonesian tire export to Egypt hit US$ 70-80 million per year. Bit with dumping duties cut, the Indonesian tire exports to could easily reach US$ 1 billion mark. The new policy is expected to further enhance the bilateral cooperation and create new opportunities in a better environment for mutual businesses to develop and flourish. Bilateral trade between both countries over the last six years increased by more than 150 percent. With its 80 million people and promising economy, Egypt is an attractive market for Indonesia. The archipelago’s exports to Egypt reached $484.48 million in the first 10 month of 2007 and imports hit $40.57 million in 2006 during the same period.

8 years sentence in Prison for Judicial Commission Member. The anti-corruption Court verdict included a Rp 400 million fine  for Irawady Joenoes for accepting bribes in a land procurement deal, as the court has proven it violate the 1999 Law on Corruption. Irawady act also  had damaged his institution’s reputations. The initial case was the Corruption Eradication Commission (KPK) investigators arrested Irawady and an Indonesian-Chinese businessman Freddy Santosa on Sept. 27 last year. Freddy was sentenced four years in prison on February 21.

Government School Text book Copyrights Take Over. The Indonesian government now has taken over a number of school text book from its authors and will list them on the web for free to public. This in order to provide free and cheap school text books and to reduce the text book price which amazingly reaching 3 to 4x times higher than it has to be as a result of oligopoly practices by bookstores. The policy will also eradicate collusion and corruption between authors, publishers, bookstores and school. Students and pupils now can download any school text book valid for five years period available for free at the official website of department of education.
 

Indonesian Supreme Court Verdict for Australian Heroin Smuggler. Schapelle Corby, one of other member of Bali 9 appeal was accepted but the Court of 3 members of supreme judges rejected her request, where her sentence remain 20 year in jail for smuggling 9,3 kg of heroin to Bali last 2006.

Government Expects ASEAN Charter to be Ratified by July. The Charter is expected to be ratified by July after receiving informal approval from the House, according to a foreign ministry official. The ramification and thorough explanation documents as requested by the House will be submitted in April or May, where the House are very concerned of  decision making, consensus, voting,  the promotion and protection of rights.
 

KPK Seizes Houses of ex-Indonesian Central Bank (BI) Chief Deputy. The confiscated house and an apartment belonging to Iwan R Prawiranata was related to him as a witness in a graft scandal involving the Central Bank, where it is suspected the house bought was from illegal money amounted at Rp13 billion. Iwan soon then become suspect, where three other suspects are current Central Bank Governor Burhanudin Abdullah, director of Legal Affairs Oey Hoy Tiong and Rusli Simandjuntak, head of the central bank s office in Surabaya, East Java. All except Burhanudin are being detained. The report says in 2003 Burhanudin led a meeting of BI directors to Approve the disbursement of Rp. 100 billion from the YPPI. The money was handed over to Oey by YPPI chairman Baridjusalam Hadi and treasure

Indonesian Finance Minister: Bureaucrats are Prone to be Bribed. Ms Sri Muljani a former of Indonesian' IMF officer, strongly suggest private sectors to star to adopt 'zero tolerance of corruption' through not to support bribe as part of culture, in order to create a clean, responsible and respectable  government. She noted that bureaucrat who asked for 'grease' do not gain respects from the community. According to a source, the community are very active in reporting bribery and blackmailing by bureaucrats.

Indonesian General Attorney' Officer Caught for Graft. The KPK undercover agents caught the officer, Urip Tri Gunawan, at Syamsul Nursalim house in West Jakarta, an Indonesian Chinese- Conglomerate who then bribed the officer at the amount of USD 660,000 (equal to Rp 6 billion). The graft was suspected in connection to General Attorney' decision to discontinue the investigation of the Liquidity Bank Support by the Indonesian Central Bank in 1997, involving Rp600 trillion (USD 66 billion) financial support to a number of Indonesian banks, which money was then robbed and transferred by the bank owners to a number of Indonesian surrounding countries such as Singapore, Malaysia, Australia, Hong Kong and China.

INDONESIAN LAW UPDATE 2008

[June 2008]

Temasek Sell all of its Shares in Indosat Cellular Provider to Qatar. Following the lost at the appeal court, Temasek of Singapore then sold all of its shares to Qatar Telecom. Temasek and its 8 subsidiaries has been found by KPPU for conducting unfair business through direct and indirect ownership and management at 2 major cellular provider in Indonesia, PT Indosat and PT Telkomsel.

Indonesia Anti Corruption Commission (KPK) Initiate Investigation at the Supreme Court. The warrant has been released to start the investigation at the Indonesian Supreme Court (equal to High Court at Common Law) in accordance to fees applied illegally and unreported to the state finance. There are Rp 31,1 billion (USD 300 million) revenue unreported, an income  paid by law seekers at all level of the Indonesian court during 2005-2007, according to the Indonesian Corruption Watch - an Indonesian NGO watchdog.

KPK initiate to Investigate State Loss at BP Migas. The total loss of the Central Government budget to the Local Government of Rp 225 trillion (USD 21 billion) is at Rp 25 trillion. The said de-consentration budget was paid to BP Migas, an independent authority in oil and as exploration and management which shares are fully owned by government. Previously, KPK also investigate state loss at 10 Departments, 11 State Enterprises and 1 Provincial Government, where a bigger number loss was found, where state properties has been awarded and illegally transferred into private properties by government officials during tenure. A number of lands and houses has been identified and confiscated, and the private personnel are now facing trial at the Anti Corruption Court.

Again, KPK arrested 5 staff at the Indonesian Custom Office. The 5 government staffs were found guilty for graft received from businessmen at Tanjung Priok Port, the major port in Jakarta. To respond this, Vice President Yusuf Kalla warned that each party must refrain from bribe, be it the businessmen, staff or higher level staffs. According to a construction businessmen, graft take almost 30% of the business in Indonesia, especially in dealing with the port authorities. They agree to start a 'zero tolerance to bribery'.

[May 2008]

Temasek of Singapore lost the Case against KPPU. The award by the Indonesian Business Competition Commission - KPPU penalized 9 of cellular telephone operators in Indonesia for monopoly through share ownership at a number of cellular providers in Indonesia. The 9 companies are Temasek Holdings Pte Ltd, Singapore Technology Telemedia Pte. Ltd,  STT Communications Ltd., Asia Mobile Holding Company Pte. Ltd, Indonesia Communications Limited, Indonesia Communications Pte, Singapore Telecommunications Ltd., and Singapore Telecom Mobile Pte. Ltd and PT Telkomsel. The KPPU award are that the 9 companies are found for breaching article 27 Law 5 year 1999 on Competition Law (for unfair competition), KPPU also ordered Temasek and its 8 subsidiaries to sell all of its shares at either PT Telkomsel or PT Indosat within 12 months, where prospective buyers must not have an afiliation with Temasek, and finally fines Temasek (and 8 subsidiaries) and PT Telkomsel to each pay fine of Rp15 billion. The Temasek then also found thier lost at the Appeal Court, where the award are tougher than the KPPU Award.

President Susilo Bambang Yudhoyono appoint Chairman for Institute for National Goods and Services Procurement. The said Institute under the National Development Body (Bappenas) will be staffed to continuously analyze, monitor and to secure the transparency and accountable government procurement. The institute and its appointment is drawn under the President Decision 34/M/2008, a complement to the previous President Decision 80/2003 of Government Goods and Services Procurement. The law has effectively curbed corruption, collusion and nepotism between government officer and brokers.

Indonesia Suggest the Implementation of UNCLOS 1982, remain.  This position was released from Indonesia, represented by the Indonesian Director General for Law and International Treaties of the Department of Foreign Affairs, in respond to the United Nations draft resolution to additional authority by the UN Security Council (UN SC) within the IMO authority to combat sea piracy at most archipelagic states, where territorial sea status may change into international sea,  which is in contrary to the United Nations Conference on the Law of the Sea 1982 (UNCLOS 1982) and United Nations Charter. The proposal will allow the UN SC warfare directly entering territorial sea without coastal state consent to combat sea pirates, where no coastal state jurisdiction applied. Indonesia suggested, that the UNCLOS 1982 shall remain, and the combat of sea piracy shall be left to the coastal state jurisdiction under the International Maritime Organization (IMO) as it used to, instead taken over by the UN SC. So far, the security over the Malacca Strait has successfully been controlled by Indonesia, Singapore and Malaysia, where sea piracy has been significantly reduced.

Poll 10 years of Reformation. Another national circulation news papers in Indonesia held its poll by 871 respondents from 6-7 May 2008, shows that generally 75% of respondents shows their great concern over the economy slow down since Reformation 1998. It is the government they blame to cut subsidies for foods, wheat flour, sugar, corn, fish in 1998, and soon to cut subsidy for premium and kerosene. Welfare State in terms of feeding people, lost its meanings when the government fails to secure its people from hunger and unemployment as shown by 50,5% respondents, while 19,7% are for legal supremacy failure and 16,5% for social and welfare failure. Nevertheless, still big numbers of respondents thank reformation for its freedom of speech and to unite. Further, 10 year Reformation 1998 shows positive responses for better security and politics (35,1%), law enforcement (17,7%), social and public access (14,5%), and economy (4,1%). Failure of reformation also shown, where government fails in economy (50,5%), law enforcement (19,7%), social and welfare (16,5%), politics and security (5,4%) and in general (2,1%). Generally respondents find pessimism for a better Indonesia in 5 years ahead (53,6%) pinpointing the unclear of national future plan (66,8%). The 4 amendment of the constitution and the strengthening of public institutions are merely normative, where politicians remain unaware to put great concern over the people. Regional autonomy brought local politics competition, instead of independency and growth for the people.

[April 2008]

Poll of 10 year of Reformation. The poll held by Demos, a research institute in human rights and democracy, shows a fundamental change reduce from 74% in 2004 to 66% in 2007 for freedom to embrace religion, language and culture, also a significant reduce from 74% in 2004 to 60% in 2006 for freedom of speech, to unite and to engage into an organization. This is as a result that democracy in Indonesia are viewed in various form, different paradigm of democracy by the people, and also that democracy find it obstacle from economy policies in terms of globalization. Therefore, a new rigid and solid policy in law and government must win over economy policy. However, significant progress is clearly shown by the actions towards new laws and regulations, significant corruption extermination, less abuse of powers by government officials, and the obedience of law by government officials and public officials.

Poll on Government Legal Officers. The poll held earlier in  March 2008 by 867 respondents at 13 major cities in Indonesia shows public disappointment towards legal officers performance these days, where 73,2% perceive no public service are free from corruption by its officers, legal officers in particular. The General Attorney’s Office and Police Institution received 95,4% and 73,4% respondents' distrust, respectively. Indonesian Anti Corruption (KPK) also receive 73,4%, following the arrest of its member (a police retiree) for a graft and blackmailing during a corruption investigation by a state enterprise, last February 2008. Again it is the General Attorney Office and Police Institution were those who did not commit to corruption extermination by 84,7% and 81,2% respectively, including the Supreme Court (75,3%), the Court  (82,2%), and KPK (67,2%). Almost half respondents (55,2%) do not trust the commitment to combat corruption in general in contrary to 42,7% who remain in trust. Of the image, General Attorneys good image increase from 29,3% up from 22,3% last year the same period. Even worse, 74,4% respondents distrust the court. It is now the public compel the renewal of new tougher bill of anti corruption, since they perceive the current laws and regulation is good since its inception in 1998, but did not sufficiently implemented. A new credible and accountable legal officer is a must.

Malaysian High Rank Officer involved in Illegal Logging. According to its investigation by an Indonesian  newspaper issued 9 April 2008, the said Malaysian person uses a Malaysian company Hardwood Timber SDN BHD in the process of disbursing papers to turn illegal into legal woods. The illegal woods are from Borneo, Indonesia, then exported to Malaysia through Indonesia-Malaysia borders. The Indonesian consulate officer in Kuching, Malaysia who witnessed the Malaysian importing papers, found it fake due to the use of wrong spelling of Bahasa Indonesia. However, Malaysian authority denied.
 

Poll on Member of the Parliament. The polls, generally shows significant perception, where 822 respondents (over 17 years of age at 10 big cities) low trust is shown for member' appearance during sessions (24% trust compared to 70,4% distrust), too much travel abroad than being at office (74,2% agree to 22,9% disagree), do not aware for people' criticism (69,2% to 27,4%) and always request additional facilities (agree 75,9%-disagree 22,4%).
 

Houses of Government  Asset valued at Rp371 trillion , missing. The said numbers are houses under government proprietary being reviewed, which big numbers has been transformed illegally into private proprietary, according to the calculation of the Directorate General for State Inventory of the Department of Finance, recently. KPK then seized at least 11 government-owned houses in Bandung, West Java, which has long been illegally transferred into private by the government officers for themselves. Other houses will follow. Of 77 department and government institutions, only 20 has conducted reviews of its assets since 2007.

[March 2008]


Malaysian Subsidiary Company in Media Content Accused for Unfair Trade Practices
. The Indonesian Fair Trade Competition - KPPU identified the Astro All Network Plc (Malaysia) - AAMN breached article 19 paragraph c of the Indonesian Competition Law. AAMN has intentionally through its business contract defined and limit distribution and trade of service and/or goods based on the initial investigation, where AAMN monopolized and took control the distribution of the said TV program during the England Football League 2007.


Government of Egypt: 40% anti dumping measure dropped to Indonesian Tire Products. The initial complaint in August 2006 then was reduces into “a slight margin of dumping by the Indonesian exporters” after the WTO agreements the allegation and tax was recently lifted. During the investigations period, Indonesian tire export to Egypt hit US$ 70-80 million per year. Bit with dumping duties cut, the Indonesian tire exports to could easily reach US$ 1 billion mark. The new policy is expected to further enhance the bilateral cooperation and create new opportunities in a better environment for mutual businesses to develop and flourish. Bilateral trade between both countries over the last six years increased by more than 150 percent. With its 80 million people and promising economy, Egypt is an attractive market for Indonesia. The archipelago’s exports to Egypt reached $484.48 million in the first 10 month of 2007 and imports hit $40.57 million in 2006 during the same period.

8 years sentence in Prison for Judicial Commission Member. The anti-corruption Court verdict included a Rp 400 million fine  for Irawady Joenoes for accepting bribes in a land procurement deal, as the court has proven it violate the 1999 Law on Corruption. Irawady act also  had damaged his institution’s reputations. The initial case was the Corruption Eradication Commission (KPK) investigators arrested Irawady and an Indonesian-Chinese businessman Freddy Santosa on Sept. 27 last year. Freddy was sentenced four years in prison on February 21.

Government School Text book Copyrights Take Over. The Indonesian government now has taken over a number of school text book from its authors and will list them on the web for free to public. This in order to provide free and cheap school text books and to reduce the text book price which amazingly reaching 3 to 4x times higher than it has to be as a result of oligopoly practices by bookstores. The policy will also eradicate collusion and corruption between authors, publishers, bookstores and school. Students and pupils now can download any school text book valid for five years period available for free at the official website of department of education.
 

Indonesian Supreme Court Verdict for Australian Heroin Smuggler. Schapelle Corby, one of other member of Bali 9 appeal was accepted but the Court of 3 members of supreme judges rejected her request, where her sentence remain 20 year in jail for smuggling 9,3 kg of heroin to Bali last 2006.

Government Expects ASEAN Charter to be Ratified by July. The Charter is expected to be ratified by July after receiving informal approval from the House, according to a foreign ministry official. The ramification and thorough explanation documents as requested by the House will be submitted in April or May, where the House are very concerned of  decision making, consensus, voting,  the promotion and protection of rights.
 

KPK Seizes Houses of ex-Indonesian Central Bank (BI) Chief Deputy. The confiscated house and an apartment belonging to Iwan R Prawiranata was related to him as a witness in a graft scandal involving the Central Bank, where it is suspected the house bought was from illegal money amounted at Rp13 billion. Iwan soon then become suspect, where three other suspects are current Central Bank Governor Burhanudin Abdullah, director of Legal Affairs Oey Hoy Tiong and Rusli Simandjuntak, head of the central bank s office in Surabaya, East Java. All except Burhanudin are being detained. The report says in 2003 Burhanudin led a meeting of BI directors to Approve the disbursement of Rp. 100 billion from the YPPI. The money was handed over to Oey by YPPI chairman Baridjusalam Hadi and treasure

Indonesian Finance Minister: Bureaucrats are Prone to be Bribed. Ms Sri Muljani a former of Indonesian' IMF officer, strongly suggest private sectors to star to adopt 'zero tolerance of corruption' through not to support bribe as part of culture, in order to create a clean, responsible and respectable  government. She noted that bureaucrat who asked for 'grease' do not gain respects from the community. According to a source, the community are very active in reporting bribery and blackmailing by bureaucrats.

Indonesian General Attorney' Officer Caught for Graft. The KPK undercover agents caught the officer, Urip Tri Gunawan, at Syamsul Nursalim house in West Jakarta, an Indonesian Chinese- Conglomerate who then bribed the officer at the amount of USD 660,000 (equal to Rp 6 billion). The graft was suspected in connection to General Attorney' decision to discontinue the investigation of the Liquidity Bank Support by the Indonesian Central Bank in 1997, involving Rp600 trillion (USD 66 billion) financial support to a number of Indonesian banks, which money was then robbed and transferred by the bank owners to a number of Indonesian surrounding countries such as Singapore, Malaysia, Australia, Hong Kong and China.

 

 

[January 2008]

39 months of Susilo BY Administration: Decrease of Economy Confidence. The Poll held by a national circulation newspaper on 15-17 January 2008 with 1356 respondents at the age of minimum 17 years at 33 Major Provincial Cities, shows that people are less confident on the government ability to resolve economy downturn. In economy, the poll shows significant decrease of confidence from 77,5% (July 2005) to 64,2% (October 2005) to 49,9% (January 2008). Public dissatisfaction on government control of the hike of prices, increased from 76% (November 2007) to 82% (January 2008). International price hikes of rice, fuel, and kerosene, directly affected the increase of food prices where most people are affected, causing increase of poor people from 35,10 millions (early 2006) to 39,5% (January 2008). These affects SBY administration image decrease from 74,9% (November 2007) to 74,6% (January 2008).

Corruption Exterminatiaon Fails to Touch High Rank Officers. Indonesian Corruption Watch (ICW) released its research, that only a small number of corruption case solved in 2007, saving state loss only the figure of Rp46,74 billion, which significantly different to numbers released by State Financial Controler (BPK) of 5.717 corruption cases of Rp 8.085 trillion. ICW stressed out that those who were arrested by the the General office Attorney' Offices and sit for trial are those at middle level of provincial government officers instead current director generals or directors at state departments.

Indonesian Central Bank Directors become Suspects. Again, KPK determined 3 high rank officers at the Indonesian Central Bank as suspect for corruption case of illegal transfers of money to  the member of the house, which was related to the bill of central banks issued earlier. Burhanuddin Abdullah (as Chairman), Oey Hoeng Tiong and Rusli Simanjuntak as deputies are responsible and will soon sit for trial at the Anti Corruption Trial. Previously two Chairman Sjahril Sabirin and Soedradjat Djiwandono were sentenced and spent their days in jail for corruption.

New Year Hit by KPK. Following its appointment for the period of 2008-2012, the new team announced a suspect Rusdihardjo (Ret Police General), also an ex Indonesian Ambassador (2005-2007) for Malaysia and ex indonesian Police Chief (2001-2005), the highest rank in Police. Rusdihardjo will be charged for illegal fee admissions at the immigration desk at the Indonesian Embassy during his tenure. Mr Wayarabi Alhadar, his predecessor was also charged 2,5 years imprisoned and Rp1,7 billion fee payable to government account, an amount he illegally received during his tenure. An immigration staff was also charged for corruption.

General Attorney' Office calls for Syamsul Nursalim. He is called for further interrogation at the General Attorney' Office related to the Bank Liquidity Support in 1997, where Syamsul, an Indonesian Chinese Conglomerate was suspected involved in. Syamsul is strongly suspected stays in Singapore. In a separate case, Anthony Salim (son of Liem Sioe Liong, an Indonesian Conglomerate) is also a suspect who appeared at the Office for the same case, causing state loss at Rp3 trillion. The Office seeks for further crime and civil legal issues to be brought in a number of legal papers and settlements by IBRA.

 

[February 2008]

Indonesian Minister of Public Health’ Siti Fadillah Supari’ Book on Bird Flu Make US-WHO Infuriated. The 182 pages book published in Bahasa Indonesia and English version, succeeded cracking the conspiracy between Unites States administration and the WHO in developing biology weapon from bird flu virus, Avian Influenza (H5N1), a policy lasted for 50 years. The book, “It’s Time for the World to Change, Divine Hands Behind Bird Flu”, shows that after the virus spread and haunted the world, companies from develop country produce vaccines, then sold it to the market with a high price in developing countries, including Indonesia. However, no compensation, no license and business orientation raised Minister' anger, right of sovereignty and pride. She also further added, that developing countries dignity cannot be play around on the basis of Global Influenza Surveillance Network (GISN) WHO. Of her works, a London-based magazine, The Economist, has put the writer a breakthrough character which started the revolution in saving the world from bird flu effect, where Sitifadillah Supari at this time has chosen the best weapon proven useful than the best vaccines in the world in overcoming the threat of bird flu, where transparency is the keyword. Following the success of the first book, the second book is about to be released, soon. The book has also caused the WHO in Jenewa agreed to all demand from Fadillah, by agreeing sharing virus and eliminate GISN. A typical Indonesian' brave breakthrough.

Graft Rampant in Education Sector: Corruption Watchdog. The release by the Indonesian Corruption Watch (ICW) are based on the facts that parents found increase in extra fees for their children at public schools, though the government has increased its budget over the school, annually. The ICW urge that corruption in the education sectors is still rampant and that the government must take action to stop the practices. ICW also pointed out the corruption has also become a common practice between teachers and school principal, as well as in regency/municipality education agencies and the Education Ministry. ICW further discovers that teachers commit corruption by charging numerous levies on to student, principals by embezzling or doubling school budgets, and education agencies by extorting or receiving bribes from school, while the ministry meanwhile has allegedly committed corruption through a number of projects. Recent ICW study showed the total amount of money parents had to pay for their elementary school children increased by 18.9%, from Rp.4.01 million (US$436) per year in 2006 to Rp.4.77 million last year. The government set aside 9.1% of the state budget, or Rp.44.1 Trillion in 2006, and 11.8% or Rp.54.06 trillion in 2007 for the education sector. In 2008, it has allocated 12.02% of the state budget, or Rp.48 trillion. The increase in school fees was triggered by increases in direct and indirect fees, direct fees included charges for courses at school, exams, building maintenance, textbooks, study tours, re-registration and farewell ceremonies, where totally reached average of Rp.600.000,- per month for a child’s education. Meanwhile indirect fees include fees for school uniform, transportation, stationery, exercise book, and after-school course. The government allocated Rp.254.000,-/student of financial aids per year in 2007 and 2008 through the School Operational Aid (BOS) program.

Public Service Law Must Also Cover Private Sector. A group of activists has its voice, that public services should focus on the wider context of the state’s responsibility in fulfilling the community’s basic needs, where private sector must be included in the legislation since its role to provide services to public. The consumer law is one of the concern where the law covers only public service, therefore it does not guarantee that private business will provide good services. To reach its effectiveness, the proposed new law shall not only stipulate administrative sanctions which cover civil services, but also criminal and civil sanctions which cover all parties including private providers of public services. However, others has its legally based-opinion, that private sector was outside the public service domain, because it was profit oriented. Private sector are based on full services, where competition is the keyword to grab the market. The new legislation is expected not only cover government officials but also those who worked in the state owned companies. the House plans to finish the legislation later this year.

Analysts Upbeat about Privatization Program. Of the 44 state firms the government plans to privatize this year, those operating in the commodity and infrastructure sectors are most likely to attract investor interest, analysts say. Among the state firms the government plans to privatize are several plantation firms that produce product such as palm oil and rubber, expected to raise at least Rp1.5 trillion. The privatization was aimed at increasing the company competitiveness and freeing the government from non-performing assets, while also generating funds for the state coffers. Investor is also expected to have its interest over state companies operating in the development of infrastructure projects.

Bali to Host World conference On Waste  The conference in June 23-27 is expected to bring together more than 1.000 delegates from developed and developing countries, with an agenda to address efforts in reduce exports of hazardous waste from industrialized nation to developing countries. Environment minister from 170 countries were expected for the ninth Basel convention on the control of trans-boundary movement of hazardous waste. The Basel Convention was started in 1992 and obliges signature country to ensure waste is managed and disposed of in an environmentally sound way. Parties should set adequate disposal facilities for the waste and covers toxic, poisonous, explosive, corrosive, flammable, eco-toxic and infectious waste. Some 168 countries have ratified the convention, excluding the U.S. Indonesia ratified the convention in 19. Indonesia is very vulnerable to illegal dumping of hazardous waste at 2.000 entry points along the costal zone. The Indonesian state ministry for the environment office said since 1980s Indonesia has become a dumping ground for hazardous and non-hazardous waste. It says the government has accepted request from foreign countries and companies to dump waste containing hydrocarbon. The government has also re-exported tons of hazardous waste to its origin countries, including Singapore. Japan is the biggest exporter of hazardous materials used for industry and agriculture sectors to Indonesia, sending 31 tons of waste in 2006. Indonesia yields about 7 million tons of hazardous waste per year- one quarter of which remains untreated. The country currently has one facility for the treatment of hazardous waste in Bogor, with a capacity of 100.000 tons. Environment Minister Rachmat Witoelar would be the new president of the conference of the Parties (COP) of the Basel Convention for the 2008-2010 period.

Developing Countries React to WTO Proposal.  Developing countries on Friday welcomed WTO proposals to farm trade but voice reservations on those calling for further opening of their own markets for industrial goods. The draft agreement on agriculture presented by the WTO a week ago "is a good basis for further work,” according to a Brazilian ambassador, where it sought after positions offer the best prospects for a balanced and reasonable outcome for the Doha Development Agenda. The WTO’s inclusion in its proposal of an average minimum reduction of 54 percent in customs duties leveled on developing country agriculture exports by industrialized nation. The G20, which besides Brazil includes such emerging powerhouses as China and India, had put forward the same proposal. But emerging market countries were less enthusiastic about the WTO draft on manufactured goods, which “largely ignored their proposals”, where “It sparked a negative reaction” according to a source. The WTO text calls on about 30 emerging countries to set a 23 percent maximum level on their custom duties on industrial products. But the document also drops any reference to the number of products a country would be entitled to protect from too sharp a decline in custom duties. The WTO ministerial meeting in April 2008 aimed at forging a north south consensus on trade in farm and manufactured goods with the hope of wrapping up the Doha talks by the end of the year. The European Commission meanwhile gave a cool reception to the new Doha Round negotiating texts from the WTO, urging a better balance. It become crucial that the texts now move forward rapidly and in a way that reflects the mainstream views of the WTO membership. The EU believes that the necessary balanced between the (industry and service) and agri texts has not been found.

Lombok Treaty Signed. The Agreement between Indonesia and Australia was signed in Lombok in November 2006, came into force Thursday 7 February 2008. The Treaty cover ‘greater collaboration’ in areas such as defense, law enforcement, counter-terrorism, maritime security and emergency preparedness, where it includes a key from Indonesia to demand Australia not to support separatist causes in its giant neighbor’ sprawling archipelagic country. The Treaty was signed both minister of foreign affairs, Hassan Wirayudha and Stephen Smith.

Indonesian Industrial Court seen as Ineffective. The ineffectiveness in settling business-related disputes are caused by of a lack of technical guidance, according to Indonesian employers Association (Apindo). Aprindo pointed out numbers of ineffectiveness are those many essential points regulated in the law for the settlement of industrial relations disputes were neglected, unclear schedule of trials, uncomfortable working equipment, inadequate court buildings, improper remuneration and allowances received by ad-hoc judges and lastly unproven judges of knowledge of industrial relations, unavailable judges from district court as a presiding judge, an ad-hoc judge and a court minuter also had caused delays in case rulings then in turn would affect business people and their companies and adversely affected the investment environment. There were about 2.008 reports registered with the court since it took effect in January 2006.

Govt to pursue privatization despite global economy. The government plans to privatize 44 state companies this year, including 10 companies initially planned to be privatized last year. The plan raised critics from the House, where it concerns over current global economic conditions, particularly turbulence in global capital markets led by the US mortgage crisis is unfavorable for the privatization plan, and that the government would be unable to secure the best share prices. Member of the house also indicated that it was aimed merely at generating money to cover the government’s growing budget deficit, which is likely to reach Rp. 87.3 triliun in 2008, or about 2% og GDP. The divestment is expected to raise about Rp.15 triliun. Member of the house suggested the administration take a specific control mechanism to avoid state losses and also to maintain majority ownership in SOEs which fall under strategic national interests

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Disclaimer: summaries presented (except notes) are from Indonesian national printed and electronic media.               All Rights Reserved. 2007

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