Comparative Guides

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4. Results: Answers
Cartels
4.
Investigations – step by step
4.1
What initial steps do the enforcement authorities take to commence a cartel investigation?
Indonesia

Answer ... According to the Case Handling Regulation, the steps taken by the KPPU before proceeding to the formal hearing are as follows:

  • Pre-investigation stage: As outlined in question 3.1, the pre-investigation stage may be commenced based on a report from a complaining party or on the KPPU’s own initiative. The KPPU’s examining investigators will assess whether the complaint report is complete and clear, and falls within the KPPU’s jurisdiction.
  • Investigation stage: As outlined in question 3.1, a formal investigation can be initiated if the KPPU found at least 1 evidence of the alleged violation in the pre-investigation stage. The investigation is conducted to gather at least 2 evidence of the alleged violation and determine whether the investigation can progress to the examination stage, during which the hearing will take place.

For more information about this answer please contact: HMBC Rikrik Rizkiyana from Assegaf Hamzah & Partners
4.2
Are dawn raids commonly conducted in your jurisdiction? If so, what are the pre-conditions for conducting a dawn raid? When, where and by whom are they conducted? Do the enforcement authorities have the power to search private as well as company premises?
Indonesia

Answer ... Under the current Competition Law, the KPPU has no authority to conduct a surprise visit or dawn raid. In addition, the KPPU cannot access company computers or emails or seize any documents from an undertaking without consent.

For more information about this answer please contact: HMBC Rikrik Rizkiyana from Assegaf Hamzah & Partners
4.3
What powers do officers have during the dawn raid? Are there any limitations on these powers?
Indonesia

Answer ... Not applicable.

For more information about this answer please contact: HMBC Rikrik Rizkiyana from Assegaf Hamzah & Partners
4.4
What are the rights and obligations of the target company and any individuals targeted during a dawn raid?
Indonesia

Answer ... Not applicable.

For more information about this answer please contact: HMBC Rikrik Rizkiyana from Assegaf Hamzah & Partners
4.5
What evidence can be seized during a dawn raid? Do the enforcement authorities have the power to interview witnesses and take statements during a dawn raid?
Indonesia

Answer ... Not applicable.

For more information about this answer please contact: HMBC Rikrik Rizkiyana from Assegaf Hamzah & Partners
4.6
How can a company best prepare itself for dawn raids? What best practices should it follow in the event of a dawn raid?
Indonesia

Answer ... Not applicable.

For more information about this answer please contact: HMBC Rikrik Rizkiyana from Assegaf Hamzah & Partners
4.7
What are the next steps in the cartel investigation following a dawn raid? What timeframe do these typically follow?
Indonesia

Answer ... Not applicable.

For more information about this answer please contact: HMBC Rikrik Rizkiyana from Assegaf Hamzah & Partners
4.8
What factors will the enforcement authorities consider in assessing whether cartel activity has taken place?
Indonesia

Answer ... According to the Article 5 Guideline, it is crucial that the KPPU proves the existence of an agreement between competing companies to demonstrate a price-fixing violation. In attempting to prove this, the KPPU will use both:

  • direct evidence (hard evidence); and
  • indirect evidence (circumstantial evidence). In particular as regards indirect evidence, an additional assessment (plus factors) is required to distinguish parallel conduct from an illegal agreement. The additional assessment (plus factors) are as follows:
    • the rationality of the price fixing;
    • a market structure analysis, which will include product homogeneity, absence of close substitutes, readily observed price adjustments, standardised prices, excess capacity, few sellers and high barriers to entry, among other things;
    • performance data analysis; and
    • facilitating devices.

Meanwhile, based on the Article 11 Guideline, a cartel is proven by considering the following factors:

  • structural factors, such as:
    • concentration level and number of companies in the market;
    • company size;
    • product homogeneity;
    • multi-market contact;
    • production inventory and capacity;
    • ownership linkages;
    • low entry barriers;
    • characteristics of demand – regularity, elasticity and changes; and
    • buyer power; and
  • behavioural factors, such as:
    • transparency and information exchange; and
    • price and contract policy.

For bid-rigging cases, based on the Article 22 Guideline, the KPPU will initially consider indicators of bid-rigging that may take place in various stages of a tender process, spanning from the planning of the tender, formation of the tender committee, up to contract awarding and the execution of the contract. However, such indicators does not necessarily confirm alleged violation of Article 22 of the Competition Law. The KPPU is still required to prove the alleged bid-rigging practice through further investigation and examination.

For more information about this answer please contact: HMBC Rikrik Rizkiyana from Assegaf Hamzah & Partners
4.9
In case of a finding of cartel activity, can the company seek to negotiate a settlement, plea bargain or similar resolution? If so, what is the process for doing so?
Indonesia

Answer ... The Competition Law does not allow for the possibility to settle or enter into a plea bargain. However, as mentioned in questions 3.1 and 4.1, under the Case Handling Regulation, the concept of behavioural remedies allows a reported party to plead guilty at the beginning of a hearing and agree to change its behaviour in order to end the examination process.

For more information about this answer please contact: HMBC Rikrik Rizkiyana from Assegaf Hamzah & Partners