2023 was a transformative year for the Indonesian Competition Commission (Komisi Pengawas Persaingan Usaha, KPPU). Among others, the KPPU updated its merger control regulation and case handling regulation, introduced guidelines to help corporations identify issues in bid rigging, and updated its guidelines to define the relevant market and mechanism for payment of administrative fines by instalments. The transformation continues with the new KPPU leadership and issuance of regulation on case handling for unfair contract terms.

The Indonesian Competition Commission (Komisi Pengawas Persaingan Usaha, KPPU) has been carrying out enforcement against unfair contract terms (UCT) since February 2022, resulting in six decisions with three infringement findings. KPPU has the authority to examine UCT cases based on Law No. 20 of 2008 on Micro, Small and Medium Enterprises, as amended (“Law 20/2008”), and recently introduced a regulation on the procedures for handling UCT cases, in the form of KPPU Regulation No. 2 of 2024 (“New UCT Case Handling Regulation”). This new regulation revoked KPPU Regulation No. 4 of 2019 on the same topic.

In the latest update of the Indonesian Competition Commission (Komisi Pengawas Persaingan Usaha, “KPPU”) online filing portal, a dual (double) nexus assessment Q&A is now required to be filled in by companies that submit a merger control notification. Although the KPPU has not issued any update to their merger filing guideline, this new questionnaire confirms how the KPPU assesses the dual nexus requirement for offshore transactions.

The new year began with the inauguration of the nine elected commissioners of the Indonesian Competition Commission (Komisi Pengawas Persaingan Usaha, KPPU). The newly inaugurated KPPU leadership hit the ground running with various engagements and announced a refined industry focus in their 100 day action plan.

Minister of Transportation Regulation No. 14 of 2023 on Amendment to Minister of Transportation Regulation No. 4 of 2022 on Services for Foreign-flagged Yachts and Cruise Ships, which came into effect on 23 May this year, expands the ports that are available for foreign-flagged cruise ships and yachts to enter and exit Indonesian waters.

On 28 July 2023, speaking at a seminar at KPPU’s head office, the competition authority’s Director of Mergers and Acquisitions indicated that KPPU may consider applying a new method for calculating administrative fines taking into account the sanctioning provisions under the Government Regulation No. 44 of 2021. This would enable KPPU to impose fines of more than the nominal limit of IDR 25 billion set under the Government Regulation No. 57 of 2010, increasing the legal risks for failing to file merger notices on time.

Following its launch in April 2023, the online notification form introduced by KPPU sets out a new set of tests for determining whether, and to what extent, a change of control has occurred in a non-majority acquisition. We summarize these tests to help you understand how KPPU will view and assess change of control in non-majority acquisitions.

On 11 July this year, the Indonesian Financial Services Authority (OJK) issued the long awaited OJK Regulation No. 11 of 2023 on Spin-off of Sharia Units of Insurance Companies and Reinsurance Companies, which replaces the provisions on sharia unit spin-off of insurance and reinsurance companies in OJK Regulation No. 67/POJK.05/2016 on Licensing and Institution of Insurance Companies, Sharia Insurance Companies, Reinsurance Companies and Sharia Reinsurance Companies.

KPPU (the Indonesian Competition Commission) continues its enforcement against rigged bids, although bid-rigging investigations no longer dominate its caseloads. Initial indications of rigged bids have been confirmed by the issuance of KPPU Chairman Regulation No. 3 of 2023 on Guidelines on Tender Conspiracy Prohibition.

Aiming to prevent anti-competitive policies being issued by various governmental institutions, on 31 March 2023 KPPU – the Indonesian Competition Commission, issued KPPU Regulation No. 4 of 2023 on the Provision of Inputs and Suggestions for Government Policies in relation to Monopolistic and/or Unfair Business Practices. In the past, various governmental policies, particularly on imports, quotas and commodities, have caused market distortion and resulted in KPPU issuing orders against other governmental institutions. Members of the public, including business entities, are welcome to provide input to KPPU if they become aware of a potentially anti-competitive governmental policy.