State prosecutors (jaksa pengacara negara) may now represent state-owned and regional-owned enterprises under the recently issued Supreme Court Circular Letter No. 4 of 2014. Until now the Supreme Court had denied representation of state-owned enterprises in business disputes by state prosecutors pursuant to a now defunct Supreme Court Circular Letter.
Godang Riadi Siregar, Deputy Attorney General of Civil and State Administration confirmed that state prosecutors are ready to represent state-owned and regional-owned enterprises in business disputes with private parties.
“State prosecutors can represent state-owned enterprises and regional-owned enterprises that are subject to the Limited Liability Company Law,” he stated during a seminar in Jakarta last Thursday.
Mr. Siregar explained that the state prosecutors’ authority to represent state-owned enterprises is provided for under Article 30 (2) of Law No. 16 of 2004 on Prosecutors, which states that prosecutors at the civil and state administration department of the Attorney General’s Office (AGO), can represent the State or the Government, before and outside the court based on a power of attorney.
He further stressed that an additional ground for state prosecutors to be able to act in this capacity is that “state-owned enterprises’ money is the State’s money,”.
However, certain limitations are imposed on state prosecutors when handling business disputes, particularly if the dispute in question is between state-owned enterprises. If such circumstances, the AGO cannot be granted a power of attorney, “It can only mediate such disputes”.
Although it may be beneficial for state-owned enterprises to be backed by the AGO when dealing with a business dispute, the implications of Mr. Siregar’s views were questioned by a representative from a state-owned enterprise who cited the recent corruption case involving the management of PT Merpati Nusantara Airlines (Merpati).
At the initial stages, the Merpati case was handled by Mr. Siregar’s department, which stated that there were no indications of corruption by Merpati and that it was expected that the case would not proceed to prosecution.
However, the case was subsequently transferred to the Deputy Attorney General for Special Crimes, who accused Merpati’s management of corruption leading to the eventual prosecutionof Hotasi Nababan (President Director of Merpati) and Tony Sudjiarto (General Manager of Procurements of Merpati).
In response to this issue, Mr. Siregar stressed that the state prosecutors in his department will work professionally.
“We will not transfer data or documents of state-owned enterprises to prosecutors that are handling corruption cases,” said Mr. Siregar.
Mr. Siregar also emphasized that his institution did not transfer the Merpati case documents to other departments at the AGO.
“I assert that documents that are received by the AGO are not transferred between divisions,” he concluded.
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