The Indonesian arm of French supermarket company Carrefour has filed an appeal with the Supreme Court challenging a ruling by a lower court and the Business Competition Supervisory Commission (KPPU) declaring it guilty of unfair business practices, according to the Jakarta Post.
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KPPU declared on 19 August that Carrefour had carried out an unfair business practice by applying a “minus margin” policy in its contracts with suppliers, the paper reported. The commission imposed an IDR 1.5bn (US$148,515) fine on the company and demanded it stop.
Carrefour filed an appeal to the ruling at the South Jakarta District Court on 13 September. The court rejected the appeal and upheld KPPU’s ruling.
Carrefour rejected the ruling from KPPU and the South Jakarta District Court, saying both had misinterpreted the terms of trade as an unfair business practice and had imposed a groundless sanction.
“We object to the ruling and therefore we are appealing to the Supreme Court,” director of corporate affairs Irawan Kadarman said in a statement.
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By GlobalDataA minus margin is a penalty Carrefour imposes on a supplier that sells its products at a lower price to a competitor of Carrefour. Carrefour has inserted the minus margin policy in its trading terms since early 2004 and said that it was a negotiable term.
The legal saga involving the company began when the Association of Modern Market Suppliers (AP3MI) filed a complaint with the KPPU citing unfair competition late last year.
