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The Business Competition Supervisory Commission on Monday released new guidelines aimed at preventing the formation of business cartels.

The guidelines were aimed at helping companies better understand the Anti-Monopoly Law, said Ahmad Junaidi, spokesman for the commission, also known as the KPPU.

Companies often breached the law without realizing it when forming coalitions that affected prices, Ahmad said.

“Because of the nature of business associations, businesses involved in them have been forming unhealthy coalitions that end up affecting prices of their products,” Ahmad said.

The new guidelines are meant to clarify what types of coalitions or partnerships break the law, he said.

Ahmad said the new guidelines includes an 11-point system for determining if cooperation between businesses constitutes the formation of a cartel.

“This sort of detail is what the [existing] law lacks,” he said.

Among the 11 points to be considered are the level of consumer purchasing power in the particular sector, the number of companies in the association and its collective market share, the level of difficulty for new companies to enter the market, the production capacity in the market, and the type of information exchanged between cooperating companies.

Ahmad said the guidelines would be disseminated to businesses in an effort to solicit their input, and adjustments could be made before they become official in late April.

Urip Timuryono, chairman of the Indonesian Cement Association (ASI), welcomed the introduction of the guidelines.

“By having specific guidelines on cartels, businesses can feel more secure about committing healthy business practices,” Urip said.

The guidelines would mean that companies would not have to spend a lot of time and money trying to determine whether they were breaching anti-cartel laws, he said.

Djimanto, the secretary general of the Indonesian Employers’ Association (Apindo), also praised the KPPU’s effort to clarify for businesses what did and did not constitute the formation of a cartel.

“I think the new guidelines will improve the KPPU’s credibility as a commission that prevents unhealthy business practices,” Djimanto said.

“Businesses will not be standing in shades of grey in terms of their practices.”