Answer ... The Competition Law does not directly apply criminal sanctions for violations of its provisions. Criminal sanctions can be imposed only under two conditions:
- where an undertaking or individual obstructs procedures under the Case Handling Regulation, the steps taken by the KPPU investigation or examination; and
- where a reported party does not comply with a final and binding decision.
In either case, a criminal investigation may be initiated and the undertaking or individual may be subject to fines and imprisonment. In the case of a criminal investigation, the Criminal Procedural Law will apply, and the investigation will be conducted by a police investigator and the prosecution by the state prosecutor. Further, the hearing will be held before a criminal judge at the authorised district court (in that the KPPU has no jurisdiction in criminal proceedings – see question 2.3).
Under Article 48 of the Competition Law, the penalties that may be imposed on a company or individual in criminal proceedings are as follows:
- for market allocation and cartel activity, a fine of between IDR 25 billion and IDR 100 billion, or up to six months’ imprisonment;
- for price fixing, a fine of between IDR 5 billion and IDR 25 billion, or up to five months’ imprisonment; and
- for obstruction of an investigation, a fine of between IDR 1 billion and IDR 5 billion, or up to three months’ imprisonment.
Answer ... Both companies and individuals can be subject to the same types of penalties in civil proceedings.
Under Article 1365 of the Civil Code, a party that commits an illegal act which causes damages to another party (tort) must provide compensation accordingly. However, as damages must be proven, a civil lawsuit can be filed only after the KPPU decision establishing a breach of the Competition Law has become final and binding.
The types of damages that may be subject to indemnity are limited to material and immaterial losses. The indemnity for material losses includes money, while the indemnities for immaterial losses vary from restitution to the stipulation of the illegal act.
For administrative sanctions and penalties, please see question 2.3.
Answer ... In determining the penalties, the KPPU will base its consideration on KPPU Regulation 4/2009 on the Guideline to Implement Article 47 of Law 5/1999. As such, the KPPU does not consider penalties from other jurisdictions.
Under this regulation, the penalty will be determined based on the proportion of sales. The exact proportion will be determined by the KPPU by considering the following factors:
- the size of the companies;
- the type of violation;
- the combined market shares of the reported parties;
- the geographical scope of the violation; and
- whether an anti-competitive agreement has been executed or implemented.
Answer ... There is no provision under the Competition Law that would prevent a company from paying the legal costs and/or penalties imposed on its employees.