Clear Distinction between BUMN and State Losses Still Needed

 
Robert Sidauruk, Hasyry Agustin
 
Debate as to whether or not losses of state-owned enterprises can be categorized as a State loss seems far from being clearly resolved, despite Constitutional Court decision No. 48/PUU-XI/2013(“Decision”) that classified state-owned enterprise (“BUMN”) losses as a State loss.
 
Several commentators remain adamant that a clear distinction must still be drawn although Law No. 19 of 2003 on State-Owned Enterprises expressly states that BUMN’s assets are to be segregated from the state treasury.
 
Dedeng Hidayat, Deputy Manager of State Power Company (PLN), contends that the Decision has created uncertainty for the board of directors of BUMNs in making business judgments.
 
“The Decision has raised concerns among directors of BUMNs when they are called on to make business judgments. As BUMN’s assets are considered State assets, business judgments for BUMN become something of considerable importance and require extra prudence to decide,” said Mr. Hidayat, during discussions at the Memorial Lecturer of Prof. Arifin P. Soeria Atmadja at the Faculty of Law at Universitas Indonesia last Thursday.
 
Moreover, the Decision continues to hamper directors of BUMNs in being able to take progressive actions given there is potential for them to be subject to criminal proceedings. As a consequence, according to Mr. Hidayat, directors of BUMNs are more like managers instead of leaders of the companies they run.
 
At the same event, Erman Radjagukguk, a law professor at Universitas Indonesia, argued that a BUMN is a separate legal entity to the State. Professor Radjagukguk further postulated that if a third party steals funds from a BUMN, that person should not be treated as stealing State funds, as a BUMN is a separate legal entity.
 
“Assets of BUMN are not State assets,” said Professor Radjagukguk.
 
Inconsistencies in Approaches
Commenting on the debate, Arie Hutagalung, an agrarian law professor at Universitas Indonesia, said that there is an inconsistency in BUMNs that want to separate BUMN assets from State assets. Professor Hutagalung contends that in several cases, BUMN use the State assets principle as a shield to gain advantage.


In one case, the head of a regional government was subject to criminal proceedings in a case against PT. Indonesia Railways Company (Kereta Api Indonesia). The head of the regional government was charged over the illegal takeover of State land.
 
“This is a double standard practiced by BUMN”, added Prof. Hutagalung.
 
To overcome this, Prof. Hutagalung suggested that BUMN should be regulated under a special regulatory framework. There must be improvements to the applicable laws to clearly define and distinguish between BUMN assets and State assets. Until such laws are realized, BUMN will continue to exert maximum efforts to protect their assets.
 
(For more discussion on BUMN loss and State loss, see ILD No. 354)
 
(hot/kc)