Jakarta. The Corruption Eradication Commission (KPK) insists it retains full authority to investigate and prosecute corruption cases involving board members and supervisors of state-owned enterprises (SOEs), despite new legislation that some believe narrows the agency’s powers.

KPK Chairman Setyo Budiyanto said the agency continues to treat directors and commissioners of SOEs as public officials under the law, making them subject to anti-graft investigations. His remarks came in response to the recently passed Law No. 1/2025 on State-Owned Enterprises, which includes provisions that critics argue could limit the KPK's oversight of SOEs.

“KPK has the authority to investigate and prosecute corruption cases committed by directors, commissioners, and supervisors in BUMNs. In the context of criminal law, they are still considered public officials, and any financial losses suffered by BUMNs are deemed state losses if those acts involve abuse of power or violations of the Business Judgment Rule (BJR),” Setyo said in a statement on Wednesday.

SOE Board Members Still Deemed Public Officials
Setyo challenged Article 9G of the new SOE Law, which asserts that SOE board members are not categorized as state officials. He argued that this provision contradicts broader legal definitions found in Law No. 28/1999 on Clean and Corruption-Free Governance, which explicitly includes SOE officials under the scope of public office.

“Law No. 28/1999 is a specific administrative law governing public officials, aimed at eradicating corruption, collusion, and nepotism. It remains the appropriate reference when dealing with corruption cases involving SOE leaders,” he said.

He also pointed to an explanatory note in Article 9G, which clarifies that the designation of SOE board members as non-public officials does not strip them of their obligations under anti-corruption laws.

Based on that, Setyo reaffirmed that SOE directors, commissioners, and supervisors are still required to submit asset declarations and report any gratification, in accordance with anti-corruption regulations.

Setyo also rejected the notion that losses at SOEs are separate from state losses. Although Article 4B of the SOE Law claims SOE losses do not constitute state financial losses, Setyo referred to multiple Constitutional Court rulings that reaffirm the contrary.

He cited Constitutional Court Decisions No. 48/PUU-XI/2013, No. 62/PUU-XI/2013, No. 59/PUU-XVI/2018, and No. 26/PUU-XIX/2021, which confirmed that separated state assets, such as capital in SOEs, remain part of state finances under Indonesia’s constitution.

“The Constitutional Court has firmly ruled that separated state finances are still considered state finances. This interpretation is constitutionally binding and should not be overridden by statutory provisions,” Setyo said.

He added that SOE executives can be held criminally liable if state financial losses occur due to unlawful acts, abuse of authority, business judgment rule violations, or fraudulent conduct such as bribery, conflicts of interest, bad faith, or negligence in preventing financial harm.

Setyo concluded that upholding corruption laws within SOEs is crucial to ensuring good corporate governance and achieving the broader goal of managing BUMNs in the public’s interest.

“Law enforcement against corruption in BUMNs is essential for promoting transparency and good governance. It helps ensure that these enterprises fulfill their mandate to advance the prosperity of the people,” he said.

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