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Preliminary hearing of judicial review of State-Owned Enterprises (BUMN) Law, Wednesday (21/2) in the Plenary Courtroom of the Constitutional Court. Photo by Humas MK/Ifa.

The preliminary hearing of the judicial review of Law No. 19/2003 on the State-Owned Enterprises (BUMN) was held by the Constitutional Court (MK) on Wednesday (21/2) afternoon. The hearing of case No. 12/PUU-XVI/2018 was led by Constitutional Justice I Dewa Gede Palguna. 

Employees of the state-owned PT PLN (Persero) [(electricity firm)] review Article 14 paragraph (3) letters (a), (b), (d), (g), and (h) of the BUMN Law that reads, "The authorized party as intended by section (2) mustobtain approval of the Minister to make a resolution in the General Meeting of Shareholders on matters with respect to: a. a change in the amount of capital; b. amendments to the articles of association; d. a merger, consolidation, acquisition, division, and dissolution of the State-Owned Limited Liability Company (Persero); g. formation of subsidiaries or participation; h. transfer of assets." 

The Petitioners’ attorney, Edy Supriyanto Saputro, argues that if the Government Regulation No. 72/2016 on the Amendment to Government Regulation No. 44/2006 on Procedures for the Investment and Administration of State Capital in State-Owned Enterprises and Limited-Liability Companies is one of the tools to privatize State-Owned Enterprises(SOEs) without exception. According to the Petitioners, SOEs whose production concerns the public will be privatized as stipulated in Government Regulation No. 39/2014 on the List of Business Fields Closed to Investment and Business Fields Open, with Conditions, to Investment. Private power plants, power transmission, and power distribution can have up to 95-100% of the shares, which will eliminate the state function to control the production branches that are important to the state concerning the lives of the people. 

The Petitioners consider that Article 14 paragraph (3) letters (a), (b), (d), (g), and (h) of the BUMN Law, the government represented by the minister as the shareholder may amend the Company\'s Articles of Association, including elements of mergers, consolidation, and transfer of assets, changes in the amount of capital, changes to the articles of association, acquisition and separation, without supervision by the House. 

"The enactment of the BUMN Law will result in the loss of right to work and viable livelihood due to the shift of SOEs into private companies without House supervision. This can lead to termination of employment of SOE employees," Edy Supriyato Saputro said. 

In addition, Edy added, it can be exploited by unscrupulous stakeholders for personal interests or groups in the company that manage the earth and water resources and the natural resources contained in it and the production branches which concerns the livelihood of the people and in principle is controlled by the state, unlike mandated by Article 33 paragraphs (2) and (3) of the 1945 Constitution. 

"With the loss of the oversight function of the House of Representatives, the Petitioners believe that SOEs will be transformed into private companies through privatization without going through discussions with the House," Edy said. 

Description of Losses 

In response to the argument presented by the Petitioners, Constitutional Justice I Dewa Gede Palguna advised them to elaborate in more detail the constitutional rights impairment they suffered. "In addition, the Petitioners must also further clarify their legal standing," he said. 

Meanwhile, Constitutional Justice Manahan M.P. Sitompul observed at the formation and systematic of the petition and requested that it be better arranged by studying the petitions that have been made by other petitioners for review at the Constitutional Court. Constitutional Justice Wahiduddin Adams advised the Petitioner to further clarify the petition. (Nano Tresna Arfana/LA/Yuniar Widiastuti)

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