The Anomaly of Domesticity: Indonesian Competition Law and the Case for Extraterritoriality

Information from the abstract

Law No. 5 of 1999 on the Prohibition of Monopolistic Practices and Unfair Business Competition has a significant regulatory gap due to its territorial approach which lacks the statutory support necessary for the Indonesian Competition Commission (KPPU) to address cross-border business realities. This article examines the dynamics of the KPPU’s efforts to assert jurisdiction over foreign business entities despite this lack of explicit statutory authority and argues for a necessity of aligning Indonesia’s competition framework with international standards. Utilizing a doctrinal research method, the study draws comparative insights from other Indonesian regulatory frameworks that already recognize extraterritorial reach in areas with cross-border impacts. The findings establish that as indeed, the other legal sectors in Indonesia have integrated extraterritorial principles. The competition law remains an anomaly, leaving the KPPU in an uneasy situation as it is not equipped with clear legal mandates on extraterritoriality issues. This research argues for urgent reform of Indonesia’s competition law to give it explicit extraterritorial reach. This would enable the country to address the complexities of a globalised market.

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Related topics: Legal and Policy Analysis in Indonesia · Legal Studies and Policies · Indonesian Legal and Regulatory Studies