T

he Transportation Ministry has opened the possibility of reviewing a controversial contract between PT Pelabuhan Indonesia (Pelindo) II and Hutchison Port Holdings (HPH) in which the state-owned company extended the Hong Kong-based firm'€™s right to operate the Jakarta International Container Terminal (JICT).

The possibility for a review emerged following the signing of a concession agreement in which Pelindo II accepted its role as a port operator and not as a port regulator.

'€œBased on today'€™s agreement, there should be a review into the contract regarding the operatorship of JICT,'€ the Ministry'€™s director for port and dredging Mauritz Sibarani said over the phone.

Mauritz said there could be revisions on the existing operator'€™s contract for JICT, which is the country'€™s largest container terminal, and the revisions will refer to the government'€™s status as the regulator and Pelindo II'€™s status as the operator.

Mauritz said, however, the ministry could not review the controversial contract because the office had not yet received a copy of it. Neither could the ministry cancel the contract as demanded by many people, including JICT workers.

'€œHow could we cancel it? The contract had never been reported to the Transportation Ministry,'€ he said, adding that the ministry had only found out it existed through media reports.

'€œWe didn'€™t even know what date it was signed.'€ Meanwhile, Tanjung Priok Port Authority head Bay M. Hasani said that cancellation of the contract was possible.

'€œOnce we know the details of the contract '€” whether it is B2B [business to business] or a concession '€” we can make adjustments. We will also check if Pelindo II acts as a regulator or operator,'€ he added.

In addition, Bay said a cancellation would be possible if the Supreme Audit Agency (BPK), which is currently doing an audit on Pelindo II, recommended one.

Pelindo II signed the contract with HPH last year, renewing the Hong Kong firm'€™s operatorship of JICT five years in advance of when its current contract was set to expire in 2019.

The renewed contract gives HPH the right to operate the JICT, which is a joint venture Pelindo II and HPH established in 1999, for another 20 years '€” that is, until 2039.

Under the agreement, Pelindo II has increased its stake in JICT to 51 percent from the previous 49 percent and HPH will have to pay US$250 million in advance to Pelindo II.

Pelindo II, which was looking to speed up the construction of the Kalibaru Port in North Jakarta, has also raised HPH'€™s rent from $60 million to $120 million per year.

However, the signing has incited backlash from JICT employees, who staged a rally on July demanding the annulment of the contract.

The workers'€™ union stated that the contract renewal had caused losses to the state and violated the law, as it was renewed five years before the contract was due to end.

The Transportation Ministry'€™s director general for sea transportation, Bobby Mamahit, also previously stated that Pelindo II should first secure permission from the ministry to renew the contract.

On Monday, other port operators, Pelindo I, Pelindo III and Pelindo IV, also signed an agreement in which the three companies committed to pay concessions amounting to a minimum of 2.5 percent of their gross revenues to the government. (fsu)