(Yicai) Aug. 8 -- The Indonesian Competition Commission, known as KPPU, has imposed a record fine of IDR449 billion (USD27.4 billion) on three local subsidiaries of Chinese construction machinery giant Sany Group for anti-competitive practices.

PT Sany Indonesia Machinery was fined IDR360 billion (USD22.1 million), PT Sany Heavy Industry Indonesia IDR57 billion (USD3.5 million), and PT Sany Indonesia Heavy Equipment IDR32 billion (USD2 million), The Paper reported yesterday, citing a non-final order from the KPPU on Aug. 6.

Their parent firm Sany Heavy Equipment International Holdings, which is Sany’s Hong Kong-listed arm, did not receive any penalty but was asked to revise its sales plan.

The case is related to Sany Heavy Equipment International Holdings’ decision in 2023 to require two Indonesian non-exclusive resellers to purchase trucks, heavy equipment, and spare parts exclusively from its three local subsidiaries, which were also selling products directly to consumers, bypassing local distributors.

Moreover, Sany imposed stricter payment conditions on the two Indonesian resellers than previously agreed in a three-year procurement deal. As a result, they failed to meet their targets and lost access to Sany’s products and spare parts.

These fines awarded to Sany should alarm all companies, said Deswin Nur, spokesperson for the KPPU. The commission will take matters seriously and impose sanctions on any company that is engaged in monopoly and unfair business practices, he added.

Sany has been investing in Indonesia for a long time. Its first overseas smart factory in Indonesia kicked off construction in March 2020, with an investment of CNY200 million (USD27.8 million). With an annual production capacity of 3,000 units, the plant mainly produces 13-ton to 55-ton excavators for the Southeast Asian market. Its capacity expansion was completed last year.

In June last year, Sany received a CNY1.8 billion (USD250.6 million) order for excavators from leading Indonesian mining company Jhonlin Group, which became the world’s most expensive single purchase of such products.

Sany has been actively expanding overseas, also in markets other than Indonesia. Sany Heavy Industry reported overseas revenue of about CNY48.5 billion (USD6.8 billion) last year, an increase of over 12 percent from the year before, accounting for 64 percent of the company’s total revenue, up from 61 percent.

Editor: Futura Costaglione