JAKARTA - PT Indo RX, a national company engaged in the shoe component industry, has won an important victory in international arbitration in Ludwigshafen, Germany. This legal process proves that the actions of Rhenoflex GmbH and its parent, Coats Group plc, including unilateral termination of cooperation, termination of supply of raw materials, and takeover of market rights in Indonesia, constitute violations of international law and business ethics.
Tama S. Langkun, PT Indo RX's attorney said that this action was no longer just a default, but was an act against the law.
"If it is allowed to continue, the losses suffered by PT Indo RX will continue to grow over time. PT Indo RX has been forced to stop activities, terminate employment, and must finance legal struggles at the very serious international level. However, PT Indo RX remains steadfast in fighting for justice and its rights," he said, in a written statement, quoted Thursday, May 1.
PT Indo RX's recent victory in international arbitration in Germany is proof of this struggle. Support from all stakeholders who uphold the law, as well as idealistic commitment from PT Indo RX's legal team, has raised a new spirit for the company and its former employees.
"There is real hope at the end of this dark alley. Finally we can win against global giant companies that also exist in Indonesia, Germany, China and United Kingdom," said Tama.
"We call on the Coats Group plc and the Rhenoflex GmbH to respect international law, enforce business ethics, and comply with the principles of good corporate governance," Tama concluded.
PT Indo RX believes that pending justice is a denial justice. Therefore, PT Indo RX will never stop demanding corrections / recovery and accountability.
On January 11, 2024, Rhenoflex GmbH, through its CEO Kumar Shirish Shah, unilaterally stated the termination of cooperation with PT Indo RX. In response to this, PT Indo RX immediately submitted an official objection through a letter dated January 22, 2024. PT. Indo RX registered this dispute on the international arbitration agenda in Germany in accordance with the agreement in the agreement on German legal choice to resolve the dispute. It was mutually agreed that the examination of evidence and witnesses would be carried out by the German Arbitration Council in Frankfurt in early September 2024.
However, before the trial for examination of evidence and witnesses was held, Rhenoflex GmbH together with the Footwear Coats Division actually took a unilateral step again by stopping the supply of raw materials that became the backbone of PT Indo RX's operations. In fact, PT Indo RX has conveyed a stern warning through a series of email correspondences to Mr. Phillipe Chatillon, Head of Customer Service EMEA & Americas, Coats Footwear, in the period 8 to 21 May 2024.
Conditions worsened when Rhenoflex / Coats Group made efforts to confiscate PT Indo RX's business unilaterally, by disseminating false information that the termination of cooperation was final, even though the parties were still undergoing the arbitration process. Since May 16, 2024, Ronald Sitorus as Head of Sales Indonesia, together with Mr. Bill Watson, Vice President of Global Sales Footwear Division, Coats Group Plc, has offensively penetrated the Indonesian market and captured the shoe component business owned by PT Indo RX under an agreement, which has lasted more than a decade.
Starting July 2024, Rhenoflex/Coats Group realized its business confiscation with the production and supply of shoe components to the Indonesian market from China through its subsidiary: Dongguan Rhenoflex New Materials Co., Ltd in Guangdong Province. This violates the exclusive rights of PT Indo RX openly, because based on the agreement, the Rhenoflex business in Indonesia is to sell raw materials to PT Indo RX, not sell shoe components to PT Indo RX customers.
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