Normative legal analysis highlights potential market dominance by SOEs, suggesting reforms in competition law.
The restructuring of SOEs can lead to potential market dominance, raising concerns about monopolistic practices and unfair business competition. This is especially relevant in industries such as energy, banking, and telecommunications, where SOEs often occupy a significant share of the market. If restructuring leads to excessive market control by SOEs, it may restrict private enterprises' ability to compete, violating the principles of fair competition as outlined in Law Number 5 of 1999. Article 51 of this law, which allows SOEs to hold monopolies in certain sectors, further complicates the regulatory landscape, creating challenges in balancing efficiency with maintaining competition. This research adopts a normative legal approach, analyzing relevant laws, regulations, and case studies of SOEs involved in restructuring. The study aims to evaluate how the restructuring aligns with competition law, particularly Law Number 5 of 1999, and assess whether the legal framework adequately addresses potential anti-competitive practices. The findings reveal that while SOEs restructuring enhances operational efficiency, it also risks undermining market competition, necessitating careful regulatory oversight to prevent monopolistic behavior. The paper concludes with recommendations for improving legal instruments to ensure that SOEs restructuring supports fair business practices while achieving national economic goals.
No takes yet. Share an insight, caveat, or question.
Alkari et al. (2024) studied this question.