Ada Pertanyaan? Hubungi Kami 
Ada Pertanyaan? Hubungi Kami Agus Sahbani, Robert Sidauruk
During the judicial review of Articles 2 (g) and (i) of Law No. 17 of 2003 on State Finances at the Constitutional Court on Monday, Hikmahanto Juwana, Professor of law, delivered his expert opinion on the legal status of state-owned company (BUMN) funds in relation to State funds.
Hikmahanto is of the view that it is a mistake to conclude that BUMN funds are categorized as State funds. To confuse these funds conflicts with the concept of the separation between public funds and private funds.
“When State funds are transferred to a BUMN as capital, the State is entitled to shares in the BUMN. Hence, the shares themselves constitute State assets, and not the funds reserve in BUMN,” Hikmahanto explained.
There is also an issue in auditing financial records if the State considers it is entitled to BUMN funds. In such cases, funds allocated by the State and the shares owned by the State will be counted as a different objects although they are derived from the same source.
Hikmahanto further explains that BUMNs fund that are derived from the State cannot be treated as State funds because a BUMN is a profit-oriented entity and the State is not.
“The State is not a profit-oriented entity that can suffer losses due to business judgment which is incontrast to a BUMN that is subject to business or commercial risk,” adds Hikmahanto.
To a certain extent, Hikmahanto continued, the absence of a clear demarcation between BUMN funds and the State funds has created uncertainty for the board of directors of BUMNs to make business judgments.
When a BUMN suffers losses from business transactions, which is common in business, the board of directors are under the shadow of criminal charges as they might be considered to have caused a financial loss to the State.
“They (board of directors) are reluctant to take progressive steps as there is potential for thenm to be subject to corruption charges if the circumstances turn out to be different to what was planned. Such circumstances have lowered the level of competitiveness of BUMN compared to private companies,” Hikmahanto explains.
The judicial review itself was filed by the Center for Strategic Studies at the University of Indonesia (CSS UI) arguing that Articles 2 (g) and (i) of Law No. 17 of 2003 on State Finances has the potential to violate the constitutional rights of society, legal entities, and the State. These Articles imply a mix between BUMN funds and State funds.
(hot/kc)
Agus Sahbani, Robert Sidauruk
During the judicial review of Articles 2 (g) and (i) of Law No. 17 of 2003 on State Finances at the Constitutional Court on Monday, Hikmahanto Juwana, Professor of law, delivered his expert opinion on the legal status of state-owned company (BUMN) funds in relation to State funds.
Hikmahanto is of the view that it is a mistake to conclude that BUMN funds are categorized as State funds. To confuse these funds conflicts with the concept of the separation between public funds and private funds.
“When State funds are transferred to a BUMN as capital, the State is entitled to shares in the BUMN. Hence, the shares themselves constitute State assets, and not the funds reserve in BUMN,” Hikmahanto explained.
There is also an issue in auditing financial records if the State considers it is entitled to BUMN funds. In such cases, funds allocated by the State and the shares owned by the State will be counted as a different objects although they are derived from the same source.
Hikmahanto further explains that BUMNs fund that are derived from the State cannot be treated as State funds because a BUMN is a profit-oriented entity and the State is not.
“The State is not a profit-oriented entity that can suffer losses due to business judgment which is incontrast to a BUMN that is subject to business or commercial risk,” adds Hikmahanto.
To a certain extent, Hikmahanto continued, the absence of a clear demarcation between BUMN funds and the State funds has created uncertainty for the board of directors of BUMNs to make business judgments.
When a BUMN suffers losses from business transactions, which is common in business, the board of directors are under the shadow of criminal charges as they might be considered to have caused a financial loss to the State.
“They (board of directors) are reluctant to take progressive steps as there is potential for thenm to be subject to corruption charges if the circumstances turn out to be different to what was planned. Such circumstances have lowered the level of competitiveness of BUMN compared to private companies,” Hikmahanto explains.
The judicial review itself was filed by the Center for Strategic Studies at the University of Indonesia (CSS UI) arguing that Articles 2 (g) and (i) of Law No. 17 of 2003 on State Finances has the potential to violate the constitutional rights of society, legal entities, and the State. These Articles imply a mix between BUMN funds and State funds.
(hot/kc)