Supreme Court Rejected Cassation For Umrah Ticket Sales, Garuda Indonesia Boss Makes Sure The Airline Implements Healthy Business Competition

JAKARTA - PT Garuda Indonesia (Persero) Tbk (GIAA)'s legal battle regarding the sale of Umrah tickets which are considered to have violated the Business Competition Law has ended in the hands of the Supreme Court (MA). The highest legal institution in the country decided to reject the appeal filed by Garuda Indonesia.

Garuda Indonesia President Director Irfan Setiaputra also responded to the official statement submitted by the Business Competition Supervisory Commission (KPPU) regarding the results of the Supreme Court's (MA) decision which strengthened KPPU's decision regarding cases of violation of the Business Competition Law Number 5 of 1999. The decision was regarding ticket sales. Umrah in 2019.

Irfan said that Garuda Indonesia fully respects the legal provisions related to the KPPU's decision.

"Currently, Garuda Indonesia is still waiting for an official notification from the Supreme Court to be studied further to ensure that follow-up actions regarding compliance with the applicable legal aspects run optimally. This includes fulfilling the company's obligations to the KPPU's decision," he said in an official statement, Wednesday, March 23.

According to Irfan, this is in line with the company's commitment to always prioritize the principles of good corporate governance. One of them is by ensuring that the business activities carried out by the company are in line with the climate of fair business competition.

"In line with this mission, in order to strengthen a conducive aviation industry ecosystem, Garuda Indonesia has also continuously adjusted the Umrah ticket sales business scheme since the end of 2019, where all Umrah travel service providers who already have official permission from the relevant authorities can become partners. Garuda Indonesia flight ticket sales business for Umrah trips," he said.

Irfan also emphasized that his party believes that a healthy business climate is an important foundation in efforts to increase the competitiveness of the aviation industry in general, including Garuda as a player in the national aviation industry.

"Therefore, in carrying out its business activities, Garuda Indonesia is always committed to continuing to uphold the application of the principles of Good Corporate Governance (GCG) in corporate governance practices, especially in the midst of the challenges of the aviation industry in the current pandemic situation which has a significant impact on Garuda Indonesia's performance," he said. .

Garuda must pay IDR 1 billion

As is known, the Supreme Court rejected Garuda Indonesia's appeal. This decision strengthens the KPPU's decision on the case of the company's discriminatory practice regarding the selection of partners to sell Umrah tickets to and from Jeddah and Medina.

Head of KPPU's Public Relations and Cooperation Bureau, Deswin Nur, explained that with the Supreme Court's decision, the KPPU's decision has permanent legal force, so that Garuda Indonesia is obliged to implement the decision.

"Especially the payment of a fine of Rp. 1 billion to the state treasury no later than 30 (thirty) days," he said in an official statement, Monday, March 21.

"If you are late in paying the fine, Garuda Indonesia may be subject to a late fine of 2 percent per month of the fine," he continued.

For your information, this case stems from public reports regarding allegations of discriminatory practices by Garuda Indonesia related to efforts to close access to the distribution channel for direct sales of Umrah tickets to and from Jeddah and Medina by the company through the Wholesaler Program.

In the report, the public and/or business actors feel disadvantaged and/or discriminated against due to Garuda Indonesia's behavior which limits direct access to ticket purchases for the purpose of Umrah to only five business actors, even initially only to three business actors.

This access restriction was carried out through the publication of GA INFO stating that starting March 1, 2019, purchases of Middle East Area (MEA) tickets which are Umrah routes can only be made through five partners from Garuda Indonesia.

In the trial, KPPU considered that Garuda Indonesia's action in appointing the six business actors as wholesalers without going through an open and transparent appointment process was not based on clear and measurable requirements and considerations, as well as inconsistencies in the rationality of wholesaler appointments.

KPPU also considers that Garuda Indonesia's action proves that there are discriminatory practices against at least 301 potential business actors in obtaining equal access.

The examination has been carried out by the KPPU until the verdict is read in the KPPU Commission Assembly Session on July 8, 2021.

"The verdict basically states that Garuda Indonesia has been legally and convincingly proven to have violated Article 19 letter d of Law Number 5 of 1999 and imposed a fine of Rp. 1 billion to GIAA," said Deswin.

However, at that time Garuda Indonesia filed a legal objection through the Central Jakarta Commercial Court on July 29, 2021 with Case Register Number 03/Pdt.Sus-KPPU/2021/PN Niaga Jkt Pst. This objection was then decided on December 3, 2021 with the order Rejecting the Application for Objection from the GIAA and defending the KPPU's Decision.

Garuda Indonesia did not accept the decision of the Central Jakarta Commercial Court, so it filed a Cassation on January 3, 2022. Then it was decided by the Supreme Court on March 9, 2022 with the decision to reject the appeal.