Jakarta (11/6) – Indonesia Competition Commission (KPPU) has imposed an administrative fine of Rp1 billion on French company Compagnie Financière Michelin Société par Actions Simplifiée à Associé Unique (CFM). The sanction was imposed because of CFM’s late notification of the shares acquisition of Kalimantan Royal Lestari Utama (RLU). The decision was read out during the KPPU Commission Panel Hearing for Case No. 20/KPPU-M/2024 in Kalimantan on Tuesday (June 10). The hearing was chaired by Commission Panel Chairman Gopprera Panggabean, with members Aru Armando and Budi Joyo Santoso.

CFM is a subsidiary of Compagnie Générale des Établissements Michelin S.C.A. (Michelin Group), a global tire manufacturer based in France. This company oversees Michelin's manufacturing, sales, and research operations outside of France. RLU is a plantation company that manages industrial tree plantations and produces integrated natural rubber. RLU is recognized as a pioneer in sustainable rubber production and is part of Michelin's pilot project to develop environmentally friendly and inclusive production models in Sumatra and East Kalimantan.

The case originated from an acquisition transaction conducted by CFM for 2,971 shares of RLU, valued at USD 69,999,900. This transaction became legally effective on July 27, 2022. During the court proceedings, it was revealed the fact that there was an automatic generate or generate system that recorded the date of notification receipt of RLU data changes, so the correct date of the notification receipt letter of changes to the Company's data is July 28, 2022. Given that the combined assets and sales exceeded the specified thresholds, CFM was required to notify the KPPU within 30 (thirty) days from the date the transaction became legally effective. Pursuant to Article 29 of Law No. 5 of 1999 as amended by Article 5 of Government Regulation No. 57 of 2010, the notification must be submitted no later than 30 (thirty) days from the date the transaction became legally effective, which was July 28, 2022. Specifically, the notification should be submitted no later than September 8, 2022. The CFM notification was complete on September 12, 2022, thus deemed two working days late in submitting the notification.

Due to the late notification, KPPU imposed an administrative fine of Rp1,000,000,000 (one billion rupiah) on CFM. The fine must be paid to the state treasury no later than 30 days after the decision becomes final and binding (inkracht).