The Business Competition Supervisory Commission (KPPU) is investigating the possibility of a cartel practice carried out by 21 cooking oil companies nationwide.
Cartel, prohibited under the 1999 Monopolies and Unlawful Business Practices Law, is defined as cooperation by industry players to deliberately fix prices.
KPPU spokesman Ahmad Junaidi said last week that the commission had found indications of such practices in its preliminary study and that an investigation was now needed to shed more light on the issue.
As part of its investigation, Ahmad said, the commission would also summon Trade Minister Mari Elka Pangestu to question her about the ministry's policies in connection to the cooking oil business.
"We have yet to set the date on when to summon the minister, but we will summon her, or at least the official at the ministry in charge of the cooking oil business, as the ministry is the decision maker," Ahmad told The Jakarta Post.
The Trade Ministry has the authority to interfere in the cooking oil market to help stabilize prices, he said.
The investigation follows months of public outcry over the high-flying prices of cooking oil since the start of the year. Cooking oil is normally priced at Rp 7,000 (US 70 cents) per kilogram, he said, but it had soared to Rp 15,000 per kilogram this year even when the price of crude palm oil (CPO) was in decline.
The KPPU's preliminary investigation found that as many as 21 major cooking oil companies, as well as some CPO producers, showed indications of cartel practices.
"The indications show the companies might have made mutual agreements to set high cooking oil prices," he said.
"The KPPU is now investigating the case and expects to finish it by February."
The commission has sent warrant letters to all the companies to attend advance questioning sessions.
During the KPPU's preliminary investigation, some of the companies also attended questioning sessions, with each company denying they were involved in collusion.
Aside from the cooking oil case, the KPPU is also investigating an alleged fuel surcharge cartel practice involving almost all airlines company serving domestic routes.
Up to 12 operators have been summoned by the commission.
KPPU investigators have found preliminary evidence suggesting the airlines deliberately imposed fuel surcharges at "unreasonable" rates despite the fluctuation of global crude oil prices. The fuel surcharge investigation is expected to be completed by January, after which the KPPU will decide whether the case is eligible to be taken to the KPPU court. (bbs)
