INDONESIA: Indomart denies monopoly charges

Operational director Yoseph Setiawan Edy has denied yesterday's (27 September) accusations from the Business Competition Supervisory Commission (KPPU) that the retail chain Indomart is operating a monopoly. Established in June, the KPPU regulates the 1999 law against monopolies and unfair competition law and one its first investigations was into the company that owns Indomart, Indomarco Prismatama.The KPPU claims that it received complaints that the retail chain sells only products from its parent company Indofood, such as Indomilk, Sunrise cooking oil and Indomie instant noodles. Edy argues however that Indofood only supplies about 11% of the Indomart goods. Of the rest, he says Nestlé and Unilever provide 7% each; Sayap Mas Utama, Tesori Mulia and Tiga Raksa Satria 4% each; 3% comes from Nusa Pro Telemedia Persada; and 2% is supplied by Nirwana Lestari, Artha Boga Cemerlang and Pangan Harum Citarasa respectively. "The remaining 54% of supplies," says Edy, "comes from more than 400 companies."With H1 sales of Rp 490bn this year, Indomart has been operating since 1998 and now controls 449 outlets. Because it is still a reasonably small outlet, however, the regulation ban on supermarkets operating within a 200-meter radius of traditional markets does not apply. The KPPU is also, therefore, investigating allegations that Indomart stores are damaging small businesses which are trading nearby.