Balikpapan court rejects lawsuit against Kideco
Thursday, July 3 2003 - 05:50 AM WIB
The court consequently ordered the release of Kideco?s assets seized after the provincial administration filed a suit against the firm in the Balikpapan court in April, Frederik J. Pinakunary said in a telephone interview.
Chief judge Iskandarsyah said in Thursday?s court hearing that the South Jakarta district court, and not the Balikpapan district court, had authority to try Kideco because the company was domiciled in South Jakarta. The East Kalimantan administration could file its suit to the South Jakarta court against Kideco if it wanted, Iskandarsyah said.
It could also appeal to the higher court if it opposed the Balikpapan court?s decision, Iskandarsyah said.
Kideco?s lawyers had told the Balikpapan court that it could not process the lawsuit filed by the East Kalimantan administration because legally Kideco was domiciled in South Jakarta.
East Kalimantan, together with Pasir regency administration, had complained to the Balikpapan court that Kideco had failed to offer its shares to the province. Kideco operated a huge coalmine in Pasir, which is part of East Kalimantan.
The province demanded Kideco to pay compensation in excess of US$300 million, and insisted that the Balikpapan court annul a previous divestment transaction. Kideco sold a 10-percent stake in 2001 to Indonesian investors.
The province?s lawsuit prompted the central government to halt the process of selling the remaining 41 percent shares of Kideco.
In keeping with its contractual obligations, Kideco is in the process of divesting 51 percent of its shares.
The company, one of Indonesia?s top coal producers, is a subsidiary of South Korean company Sam Tan Corp. (godang)