THE IMPORTANCE OF BUSINESS ETHICS TO ENSURE THE CERTAINTY OF LAW
IN DOING BUSINESS ACTIVITIES IN INDONESIA
Yoyon Mulyana Darusman
Pamulang University, South Tangerang City, Banten Indonesia
yoyon.darusman@yahoo.co.id
ABSTRACT
Business activities are the right of the people to do their living and life, in conducting business activities is not as easy as imagined, in practice there has been a very harsh business competition, where the parties who try their best to have their own strategies to achieve business success. Each individual human being has its own characteristics, which in its implementation characteristic will affect human behavior in conducting their business activities. In this case ethics and morals as a general custom and general law principles which as a universal principle can be used as restrictions in conducting ethical and fair business activities. In this research using qualitative model with juridical approach and sociological approach. The data used are primary data in the form of interviews with experts and practitioners as well as secondary data in the form of legislation, references from the doctrine of experts and additional references from the website. The conclusion of this research, that the effort is the right of society which need to be limited by ethics and morale in doing its business, the government in order to provide legal certainty has put ethics and morals as a restriction in the business of society. such as the enactment of Law no. 5 of 1999 concerning Prohibition of Monopolistic Practices and Unfair Business Competition, Law no. 8 of 1999 on Consumer Protection and other regulations.
Keywords : Business Ethic, Morality, Certainty of Law and Social Justice.
1. INTRODUCTION
Economic growth is one of the most important elements to support the economic development of a country. Indonesia is a developing country that is heading towards a developed country, has set the economic growth targeted by the government in 2018 that is 7%.1 Economic growth can run well, if supported by the creation of economic activities of the community that is also conducive. The economic activities of the community consist of various public business activities in all fields, so that all people have the opportunity to have income equally, which in the end people will have sufficient purchasing power to fulfill their life needs, so that the real purpose of the state can create the welfare of society, as mandated by the Fifth Principle of Pancasila, namely Social Justice for All Indonesian’s People.
In achieving the objectives of the State in question specifically related to the desire to achieve good economic growth, then the most appropriate way is to encourage the creation of economic
1
activities of the community are good by opening Community business activities in various sectors, so that the whole community can play an active role in exploiting business opportunities provided by the Government. For the purposes of the Government should prepare regulationsthat are able to provide legal certainty to the bussinessmen in order to conduct their business activities in justice. The opening of transparent community activities, followed by government regulation as supervisor of community business activities, will have a very large multiplayer effect on the economic growth of society, especially in creating jobs as much as possible for the community.
Aristotle mentions that man is a "zoon politicon".2 Man is naturally a political creature. As a political creature the human always has desire, expectations (ideas) or willingness that sometimes exceeds from what has been own in him at this time. Within the human person there are also human ethics(habits), character (character) which actually refer to each individual person who has certain moral habits or character.3Passion, expectation and desire of the human is closely related to the custom as well as his character, in which such relationships can have a good impact and may otherwise have an adverse impact on even a very worst impact.In order to balance the occurrence of such impacts it is required some limitations towards the human desires in which there is influence from the ethics of a human being (custom, character) by being established of necessary ethical barriers (ethic code) that need to be maintained and mutually agreed.These limitations for the businessmen can be called as“Business ethics”that is defined as knowledge of the ideal procedure of arranging and managing businesses that takes note of norm and morality that apply universally and economically / socially, and the application of norms and morality supportbusiness intent and purpose.4
Indonesia is a country based on law, but on the other hand very respect ethics in having nation and State. Bung Karno had announced the formation of a national character (character building of the nations), even though unfortunately it has not been elaborated operationally and implemented. It is inevitable that the idea remains relevant to be elaborated and implemented.5 The People's Consultative Assembly (MPR) in the New Order era has stipulated the Decree of the People's Consultative Assembly (MPR) No. V/MPR/2001 concerning the Ethics of life of the nation which includes the Ethics of Socio-Culture, Ethics of Politics and Government, Ethics of Economics and Business, Ethics of Justice Law Enforcement, Scientific Ethics and Environmental Ethics. Although the Decree of the People's Consultative Assembly cannot be implemented, but the nature of its aspiration is very necessary to be respected. The MPR has also stipulated the MPR Decree No. XI/MPR/1998 concerning the State Implementation which is Clean and Free of Collusion, Corruption and Nepotism (KKN).
In business activities in Indonesia generallyhave been running well, although in other practices there have been business practices that are not in accordance with the general habits that develop in the national community and the international community. For example the principles of consumer protection, anti-monopoly and fair business competition. For example practices that
2
www.kompasiana.com (15 February, 2018, 2.30 p.m)).
3
Ketut Rindjin. Business Ethic & Its Implementation (Revise Edition).Gramedia Pustaka Utama : (Jakarta, 2008) Page 4.
4
Budi Untung, Law & Business Ethics, ANDI: (Yogyakarta, 2012). Page 65
5
involve manipulation of bookkeeping, tax embezzlement, securities fraud, unhealthy competition, money laundering and so on. Such as: the case of foreign exchange game by Bank Duta officials (1990), burglary case of Bank Bappindo (1998), Bank Indonesia Liquidity Assistance case (BLBI-1998)6. In the case of monopoly such as: Clove Marketing Buffer Agency (BPPC) which holds clove sales monopoly to cigarette factory and also become a single buyer (monopsony) clove from the farmers. In this case it will obviously harm the consumer, because the producer or seller feels nothing rivals that he is free to determine the price, quality of products and services. In contrast, monopsony is clearly detrimental to sellers or suppliers7. Among the cases occurring in business activities in Indonesia felt by the public is very contrary to the sense of justice and along with the ongoing reform era, the government on the encouragement of society put ethics in the business (business ethics) which initially only considered as habits and general principles, incorporated into legislation (positive law), in order to provide assurance of legal certainty to anyone who violates it. By being enacted of Law No. 5 of 1999concerning the Prohibition of Monopolistic Practices and Unfair Business Competition, generally this provides guidance to business organizers to: (i) maintain public interest and improve national economic efficiency; (ii) to create a conducive business climate; (iii) prevent monopolistic practices and / or unfair business competition, and (iv) the creation of effectiveness and efficiency in business activities. Followed by being enacted of Law No. 8 of 1999concerning Consumer Protection that generally in this case provide the consumers to: (i) the right to obtain security guarantees, (ii) the right to obtain correct information, (iii) the right to be heard, and (iii) the right to beselected. Both laws reflect how much government attention to business ethics that have been used as moral standards in running the business become a norm of positive law, to be able to create legal certainty to the stakeholders of business organizers.
Structure of Think :8
6
Ibid. Ketut Rindjin. Page 67
7
Ibid. Ketut Rindjin. Page 113
8
Opcit.Ketut Rindjin. Pages 63
Market
Demand
Market System
Bureaucracy
Integrating
Moral & Ethic of
Society
Law or
Rule
2. LITERATURE REVIEW
Indonesia is a country based on the law, as mentioned in Article 1 Paragraph 3 of the Constitution of the Republic of Indonesia of 1945. The concept of a legal state comes from the German language "Rechtstaat" as the oppositeof "Machtstaat" which means state of power, developed in Europe by Immanuel Kant. That law is created because of the agreement with the community. And in social life would definitely need a rule that is functioned to regulate all human behavior in order to minimize the occurrence of something that is not desirable9. The characteristics of the legal state put forward by Immanuel Kant: (i) the existence of human rights guarantees, (ii) the separation of powers to guarantee human rights, (iii) the existence of a rule of law, and (iv) thejurisdiction of state administration to resolve problems arising from human rights violations.10 The system of legalism law as part of the flow of legal positivism adopted by the legal system. Legalism law is a thought that law is synonymous with the Law made by the makers of the Act, beyond that there is no law11. Indonesian law is implemented to the law order that is compiled into a hierarchy of legislation. The law hierarchy is the development of a system based on a staged law theory (stufenbau theory) of Hans Kelsen. Each norm bases its validity from another higher norm, so as to the highest basic norm, that is the Grund Norm.12
Etymologically ethical comes from the Greek word "ethos" in the singular form while in plural form is "ta etha", which means the habit that forms the character.13 In another sense ethics comes from the English word "ethical" which means proper, decent, civilized, morally. In the complete sentence can be mentioned as a proper and or inappropriate manner.14 Ethics is the study of right-wrong behavior from the point of knowledge. Behavior declared true if appropriate with science, and declared wrong if not in accordance with the science. Science also speaks right -wrong. It is said to be true if the science is in accordance with reality (practice), and is said to be wrong if the science is not in accordance with reality (practice). The world of science in the empirical-rational-empirical sense or practice-theory-practice field of thought.15Therefore the meaning of ethics (habits, character) actually refers to each individual person who has a habit, morals (akhlak) or a certain character. In the course of one's life the process of its formation takes place slowly but continuously, consequently it is formulated a habit and then become a strong character.16
Meanwhile, business comes from the English language "business" which means company, commerce. In complete sentence can be mentioned as an activity in doing business or
R. Soeroso. Introduction of Law Science, Sinar Grafika: (Jakarta, 2009). Page 87
12
Darji Darmodiharjo, Shidarta. Basics of Law Philosophy (What, How Law Philosophy in Indonesia. Gramedia Pustaka Utama : (Jakarta, 2006). Page 223.
13
Darsono Prawironegoro, Enterpreneurship in the 21 Century. Mitra Wacana Media : (Jakarta, 2017). Page 217
14
activity carried out by a person or entity, which in such activity is limited by the rule of law referred to by business law or commercial law. In the history of Indonesian law, business law or commercial law begins with the provisions of commerce law regulated in the Civil Code and the Book of LawCommerce. Ahmad Ihsan argues that Commercelaw is a law that regulates the problems of trade, namely the problems that arise because of human behavior in trade.18 H.M.N. Purwosutjipto argued that commerce law is a law of engagement arising from the company's field.19 While ZaeniAsyadie argues that business law is a law governing all business activities undertaken by a person or business entity (company) regularly and continuously i.e. activities to hold goods or services, as well as facilities to be traded or leased for the purpose to make a profit.20
In the development of commerce law and trade law in Indonesia, in practice has undergone significant changes, for example, the terms of trade activity have changed to the term business activity (business), this can be seen from the abolition of the provisions of the First Book of the Book of Commerce Law through the State Gazette 1938-276 which regulates the trade in general, so that the terms of trade are replaced by the term of company.21 Terms of making an attempt or doing business that in the popular language has turned into entrepreneur or entrepreneurship. Entrepreneurship or making an entrepreneur is an activity that uses capital for profit. Wira means ability, usahameans activity looking for something. Capital is something used to generate profits.22Kewirausahaan or entrepreneurship comes from French, meaning people who makes any profit, or commonly called a businessman or a capitalist.
3. METHODOLOGY
This study uses a qualitative research model that is as a method of social sciences that collect and analyze data in the form of words (oral and written) and human actions and researchers do not attempt to calculate or quantify the qualitative data that have been obtained and thus do not analyze the numbers.23 The research approach used is statute approach and historical approach. The statute approach is to review all laws and regulations that are concerned with the legal issues beingtreated. For the research on the practical activities, this statute approach will open up opportunities for researcher to study the consistency and appropriateness of a law with other laws or laws with the Constitution.24 Historical approach (historical approach) is by tracking the history of legal institutions from time to time. This approach is very helpful for researchers to understand the philosophy of the rule of law from time to time. In addition, through this
18
Sentosa Sembiring, Trading Law (Revise Edition – The Third Printing). Citra Aditiya Bhakti (Bandung 2008). Page 6
19 Ibid.
20
Wahyu Utami, Yogabhakti Adhipradana. Introduction of Business Ethics (In Theory Perspective & PracticeIn i Indonesia). Jala Permata Aksara : (Jakarta- 2017). Page 8
21
The Book of Trading Law. Citra Umbara : (Bandung-2007). Page 3
22
Opcit.Darsono Prawironegoro. Page 1
23
Afrizal, The Qualitative Research Method (As Effort to Support The use of Qualitative Research in the Respective Knowledg). Raja Grafindo Persada : (Jakarta-2015). Page 13
24
approach the researcher can also understand the changes and developments of the philosophy underlying the rule of law.25
Data used in this research are primary data and secondary data. Primary data is data obtained directly from the first source.26 The data referred to are interviews with academics, capable practitioners in the field of scholarship and business organizers who have had very long experience. Secondary data is data that includes official documents, books, research results in the form of reports and so forth.27 The data referred to is data in the form of primary legal material that is the legislation related to the object of research. Secondary legal material is in the form of opinions of experts in the field of science that will provide reinforcement for the depth of this research. Tertiary legal material is supporting data that will provide additional reinforcement in research, for example: websites, magazines and journals.
Data analysis is carried out by: analysis of all laws and regulations relating to the object of research, by processing and analyzing the material law without being able to escape from various interpretations known in legal knowledge. The interpretation is defined as the process of changing something or situation of nescience into understanding.28 While the analysis of the opinions of experts, scientists, practitioners and business organizers, conducted by trying to obtain accurate information that is expected to provide reinforcement to the validity of this study.
4. FINDINGS AND ARGUMENT
A. Government Regulation.
The intent and purpose of the existence of legislation related to the importance of ethics in the effort made by the government, nothing else only intended to maintain a balanced interest among stakeholders in the business world. The mentioned interest is an internal interest that is what regulates how interaction between business organizers and interests that are external that is regulating how the users of the products of the entrepreneurs can also be maintained their interest.
a. Prohibition of Monopolistic Practices and Unfair Business Competition.29
By the enactment of Law No. 5 of 1999 concerning Prohibition of Monopolistic Practices and Unfair Business Competition which came into effect on March 5, 2000, is intended by lawmakers as a rule that is expected to provide legal certainty to business organizers so that the interests between them can be guaranteed their interest in conducting business activities. Article (3) states that the objectives of this law are: (i) to protect the public interest and improve the efficiency of the national economy as one of efforts to improve the welfare of the people; (ii) to create a conducive business climate through the regulation of fair business competition, ensuring the certainty of equal business opportunity for business organizers, large, medium, or small, (iii)
25
Ibin. Peter Mahmud Marzuki. Page 166
26
Amiruddin and Zainal Asikin, The Introduction to Law Research Method, Raja Grafindo Persada, : (Jakarta 2014). Page 30
27
Ibid.
28
Ibid.
29
to prevent monopolistic practices and/ or unfair business competition caused by business organizers; and (iv) to create effectiveness and efficiency in business activities.
In agreement with it, it has been agreed on anything that becomes a prohibition for businessorganizers, they are:
1. Oligopoly.
That is: a prohibition for business organizers to enter into agreements with other business organizers to jointly carry out the production and / or marketing of goods and / or services that may lead to unhealthy competition, thus holding 75% of the market share of a particular type of goods or services.30
2. Pricing.
That is: a prohibition for a business organizer in making an agreement with a competing business organizer to fix the price of an item and or service to be paid by the customer or customer in the same market.31
3. Regional Division.
That is: a prohibition for business organizers to enter into agreements with their competitors, with the aim of dividing the marketing or market allocation of goods and or services, resulting in monopolistic practices or unfair business competition.32
4. Boycott.
That is: a prohibition for business organizers to enter into agreements with their competitors, preventing other business organizers from doing the same business, for the purpose of domestic and foreign markets.33
5. Cartel.
That is: a prohibition for business organizers in making agreements with competitors' business organizers, `in order to influence prices by regulating the production or marketing of goods and or services, resulting in unfair business competition.34
6. Trust
That is: a prohibition for business organizers in making agreements with other business organizers to cooperate by forming a joint company or a larger company while maintaining and maintaining the viability of each company or company whose members aim to control the production or marketing of goods and or services.35
30
Article 4 Rule No. 5/1999
31
Article5 Rule No. 5/1999
32
Article 9 Rule No. 5/1999
33
Article10 Rule No. 5/1999
34
Article11 Rule No. 5/1999
35
7. Oligopsony.
That is: a prohibition for business organizers in making agreements with other business organizers that intend to jointly control the purchase or acceptance of supply in order to control the price of goods and or services in the relevant market, so that two or three business organizers or groups of business organizersholding more than 75% market share or certain type of goods or services.36
8. Vertical Integration.
That is: a prohibition for business organizers in making agreements with other business organizers with the aim of mastering a number of products included in the series of production of certain goods and or services.37
9. Closed Agreement.
That is: a prohibition for a business organizer in entering into an agreement with another business organizer containing requirements that the party receiving the goods and or services will only supply or not re-supply the goods and or services to a particular party or at a certain place.38
10. Agreement with Foreign Affairs.
That is: a prohibition for business organizers in making agreements with other parties abroad, where the agreement contains provisions that may lead to unfair business competition.39
b. Consumer protection.
The enactment of LawsNo. 8 of 1999 on Consumer Protection.40It is purposed to provide a guarantee of protection to the consumer for the loss and ill-treatment by the producer or seller for the sale of defective or expired goods, a mixture of health-damaging food and beverage, in the case that the goods purchased are not refundable, lost passenger responsibilities, denial of promises, and so on. The position of the consumer in this case is very weak. Laws No. 8 of 1999 entered into force on April 20, 2000 in it regulates provisions on rights and obligations between consumers and producers who are also equipped with legal sanctions for violations committed by producers which ultimately can harm consumers. The consumer has the right to obtain correct information about the product, the right to file a complaint about the product, the right to obtain compensation for the wrong product, and to have the right to supervise the product. Therefore, the general principles incorporated into the provisions of consumer protection legislation, is one part of business ethics that must be maintained jointly by business organizers and consumers.
B. Expert Opinion and Argument
36
Article 13 Rule No. 5/1999
37
Article 14 Rule No. 5/1999
38
Article 15 Rule No. 5/1999
39
Article 16 Rule No. 5/1999
40
BambangSantoso as business organizer in the field of land and property, suggests that business ethics implications related to monopoly restrictions and business competition cannot be implemented in certain business fields such as property, because the price established by the business entity is based on the regulations determined by government, except in other fields of business, especially in the field of agricultural commodities, such as palm oil business, because the price of oil palm cannot be determined by the government, the price depends on the situation and condition of each industrial area. however business ethics as it has been adopted to the law on monopoly restrictions and business alienation is still required, as a government control to oversee unfair business competition. OksidelfaYanto as an expert in IPR (intellectual property rights) that any business organizer must be in it will be related to IPR (intellectual property rights), therefore the parts of IPR (intellectual property rights) there is the role of business ethics in it especially with the violation business ethics in using of IPR. For example the use of brands that are almost identical to the original owner of the trademark. Violations in terms of the code of ethics are what they do will harm the interests of the rights owner. So that will affect the development of the owners of the original brands, as well as other IPR. Then when talking ethics in a business should a company establish good manners or behavior because of the existence of Law no. 5 of 1999 and Law no. 8 of 1999, is very important because in business when interacting in the competition, then ethics should be a guide in doing work based on honest and professional morals.
While Surya Budiman as a business organizer in the field of banking mention ethics and morals are very important in business, good ethics and moral right, will create customers in a long time called long term customers that will help companies in achieving sustainable development, now this is a lot of misguided business people, so they forget about forgetting ethics and moral that result in disappointed customers so that customers move to another company, this will in the long run shut down the company itself. In the field of ethics and moral banking is actually very closely guarded, because the goal is a long term superior value, sometimes in terms of technical erroneous because pursued by the target, so that the executor under the work is not in accordance with the correct procedures that are important targets achieved, incorrect means of bad credit collection, credit disposition, this condition will not provide long term customer value, which will ultimately lead to the impact of disbelief of the community on the banking business.
C. Analysis.
Article 27 Paragraph (1) states that "all citizens shall be equal before the law and government and shall uphold such law and government with no exception."The meaning of the article asserts that all citizens have equality before the law and government. Furthermore Article 28A of the 1945 Constitution states that "every person shall have the right to live and have the right to preserve his life and life". The meaning of the article also affirms that every citizen has the right to life and the right to preserve his life. Both articles if comprehensively interpreted have given affirmation to every citizen, that Indonesian citizen has equal position to live and the right to sustain his life.
conduct free business activities, but freely which is limited by general customs and general principles of universal law which live in society, that is ethics and morals. Indonesia as a legal state based on legal positivism, has put the general habits and legal principles that live in society into positive law that is legislation. Likewise, general habits and general legal principles relating to business activities for every citizen (business ethics) have also been incorporated into legislation.
The enactment of Law no. 5 of 1999 concerning Prohibition of Monopolistic Practices and Unfair Business Competition, Law no. 8 of 1999 on Consumer Protection, as well as other implementing regulations, is a long historical process of the Indonesian government in order to provide assurance of certainty to every citizen to conduct business in a healthy and fair manner, as aspired by the Five Principles of Pancasila Social Justice for All People of Indonesia.
4. CONCLUSIONS
REFERENCES
A. Books
Afrizal, The Qualitative Research Method (As Effort to Support The use of Qualitative Research in the Respective Knowledg). Raja Grafindo Persada : (Jakarta-2015).
Amiruddin and Zainal Asikin, The Introduction to Law Research Method, Raja Grafindo Persada, : (Jakarta 2014).
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B. Regulation.
The Constitution Republic Indonesia of 1945.
The Rule No : 48 / 2009 concerning of Judicial Power
The Rule No : 5 / 1999 concerning of Prohibit of Monopoly Practice and Business Compate.
The Rule No : 8 / 1999 Tentang Perlindungan Konsumen.
C. Internet.
www.braily.co.id (2018).
www.kompasiana.com (2018)
www.tribunnws.com (2018) D. Interviewer
