Communities Threatened to Pay Highly for Public Services PATTIRO: There is a Systemic Effort to Eliminate SOEs as Public Entities

The Center for Regional Studies and Information (PATTIRO) assesses that currently there are several events that can be regarded as systemic efforts to eliminate State-Owned Enterprises (BUMN) as Public Bodies which have the obligation to provide information to the public in accordance with the provisions of Law number 14 of 2008 concerning Public Information Disclosure (UU KIP). The first event was the submission of a Judicial Review (Material Test) of Law No. 17 of 2003 concerning State Finance and Law No. 15 of 2006 concerning the Supreme Audit Board which was submitted by the BUMN Law Forum and the Center for the Study of Strategic Issues at the University of Indonesia (PPMSUI).

The second incident was the lawsuit by PT Bank Negara Republik Indonesia Syariah (PT BNI Syariah) to the Central Information Commission (KIP) over KIP’s decision on a dispute over public information register number 087/III/KIP-MS-A/2012, which decided that the information submitted by the applicant is public information and requires PT BNI Syariah to provide such information to the applicant. PT BNI Syariah challenged the KIP Decision through the Central Jakarta District Court by stating that PT BNI Syariah is a subsidiary of a BUMN in the form of a Limited Liability Company (PT), not a BUMN or a public body so that it is not subject to the KIP Law.

The third incident was Putera Batam University (UPB)’s lawsuit against the decision of the Riau Archipelago Province Information Commission (Kepri) which decided UPB to provide information on exam results requested by 11 of its students, through the Batam District Court. Even though this event has nothing to do with BUMN, the decision to be taken by the District Court can become jurisprudence for other district courts against lawsuits against decisions on information disputes. Even though it is clear, a university is a public body.

According to article 1 paragraph 3 of the KIP Law (UU No 14 of 2008), what is meant by a public agency is an executive, legislative, judicial, and other body whose function and main duties are related to the administration of the state, which part or all of the funds come from the budget state revenue and expenditure and/or regional revenue and expenditure budget, or non-governmental organizations as long as part or all of the funds are sourced from the state revenue and expenditure budget and/or regional revenue and expenditure budget, community donations, and/or foreign countries.

Then is SOE a Public Entity? The answer is Yes. In the definition of a Public Agency, SOEs are not specifically stated, but in Article 14 of the KIP Law SOEs have the obligation to provide Public Information according to what is stated in the said article. Likewise with BUMN subsidiaries, such as PT BNI Syariah. Article 1 point 2 Minister of State-Owned Enterprises Regulation No. Per-03/MBU/2012 states that BUMN Subsidiaries are limited liability companies whose shares are mostly owned by BUMN or limited liability companies controlled by BUMN. The purpose of the BUMN Ministerial Regulation is to state the legal form of a BUMN subsidiary, namely a limited liability company. This form of legal entity does not make them not public bodies, because in the establishment of BUMN subsidiaries, state-owned money is also indirectly included in the form of BUMN shares which must be protected for their use. So that BUMN subsidiaries must also comply with the provisions of the UU KIP.

Meanwhile, in the first event, if the judicial review is granted by the Constitutional Court, then the status of BUMN as a public body will be lost so that BUMN does not have to comply with the UU KIP. With the loss of BUMN status, what will happen is the privatization (liberalization) of the public service sector which has so far been managed by a number of BUMNs, such as public transportation served by PT Kereta Api, management of electricity resources by PLN, or Pusri as a fertilizer provider for farmers.

For this reason, in order to respond to the events that occurred, PATTIRO made the following recommendations :

  1. The Constitutional Court must have the courage to make a decision, namely to completely reject the judicial review submitted by the BUMN Legal Forum and PPMSUI. This is very necessary to maintain state assets and protect the rights and interests of the community related to the existence of SOEs. Communities still really need the status of PT Kereta Api, PLN, Drinking Water Company, PUSRI as BUMN or BUMD as providers of services and products to meet their needs..
  2. The District Court, both the Central Jakarta District Court and the Batam District Court, must cancel the lawsuit against PT BNI Syariah and Putera Batam University, and declare that they are public bodies and must comply with the KIP Law. This is very necessary to avoid jurisprudence over decisions on information disputes that have been taken by the Information Commission, because every time it makes a decision on an information dispute, the Information Commission has carefully considered all aspects of supporting the decision.
  3. Requesting the State Minister for BUMN, to withdraw the judicial review submitted by the BUMN Legal Forum and PPMSUI to the Constitutional Court, as well as issuing a Circular Letter to all BUMN informing that BUMN subsidiaries are public bodies and must comply with the KIP Law.

Jakarta November 21, 2013

Sad Dian Utomo | Executive Director PATTIRO
saddian@pattiro.org | 0812 800 3045

Contact Person: Rohidin Sudarno | Public Service Specialist
roi@pattiro.org | 081310539884

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