Industries such as construction, e-commerce, pharmaceuticals, logistics, and now digital finance (like Peer-to-Peer lending) have been the focus of cartel investigations due to their susceptibility to coordinated pricing and bid rigging.
In the dynamic landscape of Indonesian business law, cartel regulation has emerged as a focal point for compliance and enforcement in 2025. With the evolving demands of global trade, digital market integration, and stricter domestic policies, the legal framework governing anti-competitive practices—particularly cartel behavior—has seen substantial development. Understanding cartel law in Indonesia 2025 is critical for businesses that seek to navigate the competitive landscape without risking regulatory sanctions.
Cartel law refers to the body of regulations that prohibits agreements or concerted practices among competitors that have the objective or effect of restricting competition. Common cartel practices include price fixing, bid rigging, market allocation, and production limitations. In Indonesia, these practices are strictly prohibited under national competition law due to their adverse impact on fair market competition and consumer welfare.
Law Number 5 of 1999
The principal statute that governs cartel activities in Indonesia is Law No. 5 of 1999 on the Prohibition of Monopolistic Practices and Unfair Business Competition. Article 11 of this law explicitly prohibits agreements between competitors that aim to influence prices or supply of goods and services in the market. This forms the backbone of cartel law in Indonesia 2025.
The Business Competition Supervisory Commission (Komisi Pengawas Persaingan Usaha – KPPU) is the regulatory authority tasked with enforcing cartel law in Indonesia. The KPPU is empowered to investigate, adjudicate, and impose sanctions on businesses found to be engaging in cartel conduct. It operates as an independent body with quasi-judicial authority.
Understanding the components that constitute a cartel is crucial for compliance. The following are essential characteristics:
Agreements to fix, raise, or stabilize prices eliminate competition and are considered per se illegal under cartel law in Indonesia 2025.
When businesses agree to divide territories, customers, or product lines, it limits consumer choice and creates regional monopolies.
In public procurement or private tenders, bid rigging undermines fair bidding processes. This can include cover bidding, bid rotation, or market sharing disguised as competition.
Read more our article: Understanding Antitrust and Competition Law in Indonesia
KPPU has broad authority to investigate potential violations. Tools include:
These powers make enforcement of cartel law in Indonesia 2025 robust and far-reaching.
The KPPU may use:
The threshold for proof does not necessarily require direct evidence; circumstantial evidence, when coherent and consistent, may be sufficient.
Violations of cartel law in Indonesia 2025 may result in:
Future reforms of Law No. 5/1999 may introduce criminal sanctions, including imprisonment for severe or repeated offenders.
Indonesia’s leniency program, inspired by global best practices, allows cartel participants to come forward in exchange for reduced or waived penalties.
The leniency system is a cornerstone of proactive enforcement under cartel law in Indonesia 2025.
Read more our article: Merger in Indonesia: A General Overview for Businesses
To avoid violations, businesses should implement:
Routine reviews of procurement, pricing, and contract policies to ensure compliance.
Educating employees about competition laws, risks, and ethical conduct.
Formalized frameworks that include reporting procedures, whistleblower protection, and periodic legal assessments.
By institutionalizing these practices, companies can align their operations with cartel law in Indonesia 2025.
Kusuma & Partners advise you to ensure your company’s legal compliance under the Indonesian regulatory regime.
In an era of globalization, cartel behavior often spans jurisdictions. Indonesia has increased collaboration with regional and international bodies such as:
These relationships support cross-border investigations and harmonization of antitrust enforcement strategies.
Recent enforcement cases and regulatory developments in 2025 reveal significant insights into the current landscape of cartel law in Indonesia 2025:
In mid-2025, KPPU began investigating several peer-to-peer (P2P) lending platforms over alleged coordinated conduct involving interest rate setting and borrower allocation. The case was triggered by whistleblower complaints and supported by market behavior analysis. This reflects the growing concern over anti-competitive behavior in digital financial services, where rapid growth and limited regulation have created opportunities for collusion.
In early 2025, KPPU investigated several prominent e-commerce platforms for alleged coordination of commission fees imposed on third-party sellers. Although formal sanctions are pending, the investigation highlights growing scrutiny in the digital marketplace.
The pharmaceutical industry saw intensified enforcement actions involving allegations of coordinated pricing among local drug manufacturers. The case underscores the KPPU’s focus on sectors critical to public welfare.
A consortium of construction firms was fined in March 2025 for manipulating bids in state-funded infrastructure projects. This case reflects the KPPU’s robust stance against collusion in government procurement.
There has been a noticeable uptick in leniency applications by businesses seeking to avoid harsher penalties, indicating greater awareness and strategic use of the leniency program.
The KPPU has initiated preliminary studies into algorithmic pricing tools used by businesses, particularly in transportation and hospitality sectors, to determine whether they facilitate tacit or explicit collusion.
These developments demonstrate a clear trend toward heightened enforcement and modernization in detecting and addressing cartel behaviors.
As Indonesia refines its competition regulatory environment, compliance with cartel law in Indonesia 2025 has become more than a legal requirement—it is a strategic imperative. Businesses must ensure they are not inadvertently exposed to cartel risks. With the KPPU’s growing capabilities and international collaboration, the likelihood of detection and penalties is higher than ever.
At Kusuma & Partners Law Firm, we provide strategic counsel and defense in all matters relating to Indonesian competition law. If your business is under investigation by the KPPU, or you seek to implement a corporate compliance program, our team is ready to assist. Contact us today to schedule a confidential consultation with our experienced competition law attorneys.
“DISCLAIMER: This content is intended for general informational purposes only and should not be treated as legal advice. For professional advice, please consult us.“
