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Indonesia court rejects Temasek appeal: report

AFP - Saturday, May 10

JAKARTA (AFP) - - An Indonesian court has rejected an appeal by Singaporean investment giant Temasek against a ruling that it breached anti-monopoly laws, a report said Friday.

The Central Jakarta district court upheld a November ruling by the Indonesian competition watchdog KPPU ordering Temasek to divest a stake in one of two of Indonesia's largest telecom operators, news website Detikcom said.

The November ruling ordered the state-linked firm to divest its stake in either PT Telkomsel or PT Indosat within two years.

Friday's court ruling shortened the deadline for divestment to 12 months after the exhausting of the appeals process.

Temasek said it was "deeply disappointed by the verdict" and it planned to file an appeal with Indonesia's Supreme Court.

"The facts are Temasek has no shares in Indosat and Telkomsel, and plays no role in their business decisions and operations," said Temasek managing director for strategic relations Goh Yong Siang in a statement.

Indosat is 41 percent owned by Asia Mobile Holdings (AMH), which is a 75 percent-held subsidiary of ST Telemedia. ST Telemedia is fully owned by Temasek.

Temasek indirectly holds 35 percent of PT Telkomsel via its 56-percent owned unit Singapore Telecommunications Ltd. (SingTel).

"Both Telkomsel and Indosat are regulated businesses, operating within the guidelines of the Indonesian Telecommunications Regulatory Authority or Badan Regulasi Telekomunikasi Indonesia (BRTI)," said Goh.

"It is therefore not possible for Temasek to engage in any monopolistic or anti-competitive practices in the Indonesia mobile telecommunications market."

"The decision is going to have a negative impact on the investment climate here," Temasek lawyer Todung Mulya Lubis said.

Temasek was established in 1974 by the Singaporean government and it has an investment portfolio worth more than 100 billion dollars with stakes in some of Asia's best-known companies including Singapore Airlines.

Last November's KPPU ruling was roundly denounced by analysts as nonsensical and a threat to already lacklustre investor interest in Indonesia.

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