Merger Filing at KPPU in Indonesia: Rules and Procedures

1. Requirements for Merger Filing at KPPU

In Indonesia, the KPPU (Komisi Pengawas Persaingan Usaha) is responsible for overseeing merger notifications. The requirements for filing a merger notification are as follows:

• Threshold Criteria: A merger must be notified to the KPPU if the combined assets or sales of the merging parties exceed certain thresholds. As of the latest regulations, this includes:
  • For domestic mergers, the combined assets must exceed IDR 2.5 trillion or the combined sales must exceed IDR 5 trillion.
  • For foreign-to-foreign mergers, notification is required only if both parties have assets or generate sales in Indonesia.
• Timeframe for Notification: The notification must be submitted no later than 30 days after the merger is executed.
• Pre-filing Consultation: While not mandatory, businesses are encouraged to engage in verbal pre-filing consultations with KPPU to clarify any uncertainties regarding the filing process.

2. Needed Documents for Submission

The following documents are typically required for a merger notification:

• Notification Form: A completed notification form as prescribed by KPPU.
• Business Overview: A description of the merging entities, including their business activities, market share, and financial performance.
• Financial Statements: Recent financial statements of the merging parties.
• Merger Agreement: A copy of the merger agreement or relevant documentation outlining the terms of the merger.
• Market Analysis: An analysis of the relevant market, including potential impacts on competition.
• Additional Information: Any other documents that may be required by KPPU to assess the merger's impact on competition.

3. Detailed Procedure for Filing

The procedure for filing a merger notification with KPPU is as follows:

1. Preparation of Documents: Gather all necessary documents as outlined above.
2. Online Submission: All required documents must be submitted through the KPPU's online notification system. The submission must be in the Indonesian language, as per Article 13 of KPPU Regulation 3/2023.
3. Verification of Completeness: After submission, KPPU will verify the completeness of the notification. If any documents are missing, KPPU will notify the parties to complete the submission.
4. Review Process: KPPU will review the submitted documents and may request additional information or clarification during this process.
5. Decision: KPPU will issue a decision regarding the merger within 30 business days from the date of complete submission. The decision may include approval, conditional approval, or rejection of the merger.
6. Post-Closing Notification: If the merger is executed, a post-closing notification may be required, depending on the specifics of the transaction.

Where to Submit Documents

KPPU Online Notification System: The documents must be submitted through the KPPU's official online portal. The link to the portal is available on the KPPU's official website.

4. Important Information and Exceptions

• Late Filing: If a merger is executed without prior notification, KPPU may assess the situation and allow for late filing, but this is subject to KPPU's discretion.
• Negotiation of Remedies: For problematic transactions that may raise competition concerns, businesses may negotiate remedies with KPPU to address these issues.
• Foreign-to-Foreign Mergers: As mentioned, foreign-to-foreign mergers only require notification if both parties have assets or generate sales in Indonesia.
• Filing Fees: As of May 4, 2023, there are filing fees associated with the merger notification process, which vary based on the size of the transaction.

5. Relevant Links and Resources for Reference

• KPPU Official Website: KPPU
• Baker McKenzie on Merger Control Regulation: Baker McKenzie Insight
• AHP on Foreign-to-Foreign Merger Regulations: AHP
• Hukumonline on Merger Notification Procedures: Hukumonline
• Legal Alert on New Merger Filing Regulation: Chambers

This comprehensive guide provides an overview of the requirements, needed documents, procedures, important information, and relevant links for filing a merger notification with KPPU in Indonesia. It is advisable to consult with legal experts or advisors familiar with Indonesian competition law to ensure compliance with all regulations.

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