Cooking Oil Companies Fixed Prices, KPPU Says

The Business Competition Supervisory Commission has determined that 20 out of the country’s 21 cooking oil producers colluded in setting prices and has imposed a combined total of Rp 290 billion ($32.2 million) in fines on the companies. The fines range from Rp 1 billion to Rp 25 billion for each company.

Dedie Martadisastra, head of the commission’s investigation in the cooking oil case, said on Tuesday the price-setting had caused consumers to suffer losses amounting to Rp 1.6 trillion on purchases of branded and non-branded cooking bought from April to December 2008.

During the period, crude palm oil prices slumped due to the global financial crisis, but the price of cooking oil remained high.

“The plunge in the CPO price did not result in companies dropping their cooking oil prices despite the price of CPO accounting for 87 percent of the production cost of cooking oil,” Dedie said.

PT Nagamas Palmoil Lestari was the only cooking oil producer that was not found to have violated competition laws.

The commission, also known as the KPPU, found that several groups — such as Wilmar Group, Musim Mas Group, Permata Hijau Group, Sinar Mas Group, Salim Group, Sungai Budi Group, BEST Group and HAS Group — controlled most of the 20 companies.

The KPPU also found indirect evidence that the companies had held meetings that discussed selling prices, production capacity and production costs.

Dedie said the companies had 14 days to decide whether to file appeals against the decision.

Rori Wardana, lawyer representing five of the companies, said he would talk with his clients before deciding whether they would appeal the decision or not.

The 20 companies found by the KPPU to be in breach of competition laws are: PT Multimas Nabati Asahan; PT Sinar Alam Permai; PT Wilmar Nabati Indonesia; PT Multi Nabati Sulawesi; PT Agrindo Indah Persada; PT Musim Mas; PT Intibenua Perkasatama; PT Megasurya Mas; PT Agro Makmur Raya; PT Mikie Oleo Nabati Industri; PT Indo Karya Internusa; PT Permata Hijau Sawit; PT Nubika Jaya; PT Smart; PT Salim Ivomas Pratama; PT Bina Karya Prima; PT Tunas Baru Lampung; PT Berlian Eka Sakti Tangguh; PT Pacific Palmoil Industri and PT Asian Agro Agung Jaya. Ardian Wibisono

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