A coalition of Indonesian social activist groups and think tanks on Tuesday filed a request for a judicial review of the government’s plan to offer legal immunity to buyers of bonds issued by Danantara, saying it could weaken efforts to fight corruption, money laundering and tax crimes.
The coalition, which includes the Center of Economic and Law Studies, Transparency International Indonesia and Paramadina Public Policy Institute, said in a statement that they submitted the request at the Constitutional Court on Tuesday.
“No group of citizens should be allowed to receive treatment that places them above the law. When laws are created to close the doors on investigations, inquiries, courtroom evidence, or even tax oversight, it is not only law enforcement that is being weakened, but the constitution itself,” Muhamad Saleh, legal counsel for the petitioners, said in a statement.
The coalition is challenging provisions in a revised financial sector law, which was passed last month, related to the Patriot bonds and “merah putih” bonds of the sovereign wealth fund Danantara Indonesia.
The ‘immunity’ clause guarantees that purchases of Danantara’s special bonds will be protected from potential criminal and tax-related prosecution, as well as civil lawsuits.
Danantara did not immediately respond to a request for comment regarding the judicial review filing.
The provisions have drawn criticism from legal and economic experts, who warned they could create a channel for holders of illicit or undeclared funds to enter the formal financial system without sufficient scrutiny.
Jakarta has defended the rules, saying they would allow more money to flow into Indonesia’s financial system and be used for development.
Earlier this month, another coalition of civil society groups urged a global financial crime watchdog, the Financial Action Task Force, to review the bonds’ legal protections.
Reuters
