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Political Strategies of TNCS for Corporate Interest in Indonesian Public Interest Litigation: Lesson ...

Political Strategies of TNCS for Corporate Interest in Indonesian Public Interest Litigation:... and INTRODUCTION The pursuit of corporate profit maximisation from their foreign direct investment (FDI) in host countries often leads transnational corporations (TNCS) to go beyond their commercial to non-commercial strategies. Among these strategies, resort to political influence appears to be prominent in Indonesia, a developing country and an important destination of TNCs with their FDIS. TNCs conduct their business operation in Indonesia mostly by establishing a subsidiary company under a joint venture or operation agreement with domestic enterprises on specific business projects, or simply by opening branch offices. The involvement of local stakeholders inevitably requires TNCS and their subsidiaries to deal with local court settlements in disputes arising out of their multiple fornls of business operations, especially when court clarification on TNCS' rights and obligations is needed, or when TNCS have no other option except to respond to legal actions brought against them under the local laws. Under the Indonesian law of civil procedures, TNCS as legal entities doing business in Indonesia can sue and be sued in civil courts. But most foreign investors find civil court proceedings cumbersome. Their main concern is the alleged discrimination against them in Indonesian court. TNCS are likely to have confidence in http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of World Investment and Trade Brill

Political Strategies of TNCS for Corporate Interest in Indonesian Public Interest Litigation: Lesson ...

Journal of World Investment and Trade , Volume 12 (5): 23 – Jan 1, 2011

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Publisher
Brill
Copyright
Copyright © Koninklijke Brill NV, Leiden, The Netherlands
ISSN
1660-7112
eISSN
2211-9000
DOI
10.1163/221190011X00049
Publisher site
See Article on Publisher Site

Abstract

and INTRODUCTION The pursuit of corporate profit maximisation from their foreign direct investment (FDI) in host countries often leads transnational corporations (TNCS) to go beyond their commercial to non-commercial strategies. Among these strategies, resort to political influence appears to be prominent in Indonesia, a developing country and an important destination of TNCs with their FDIS. TNCs conduct their business operation in Indonesia mostly by establishing a subsidiary company under a joint venture or operation agreement with domestic enterprises on specific business projects, or simply by opening branch offices. The involvement of local stakeholders inevitably requires TNCS and their subsidiaries to deal with local court settlements in disputes arising out of their multiple fornls of business operations, especially when court clarification on TNCS' rights and obligations is needed, or when TNCS have no other option except to respond to legal actions brought against them under the local laws. Under the Indonesian law of civil procedures, TNCS as legal entities doing business in Indonesia can sue and be sued in civil courts. But most foreign investors find civil court proceedings cumbersome. Their main concern is the alleged discrimination against them in Indonesian court. TNCS are likely to have confidence in

Journal

Journal of World Investment and TradeBrill

Published: Jan 1, 2011

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