Astronomical Failure ?: Government Accelerates Investigation of Unauthorized Satellite Contracts – Policy

Astronomical Failure ?: Government Accelerates Investigation of Unauthorized Satellite Contracts - Policy

Jakarta   ●  
Fri, January 14, 2022

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  • The government is seeking to hasten its investigation of the Defense Ministry’s signing of allegedly unauthorized satellite leases to fill a strategic orbital slot in 2015, a move that may have cost taxpayers billions of rupiah.
     
    Over the past few years, Indonesia has faced a series of lawsuits over its failure to pay several satellite operators to temporarily fill the country’s orbital slot at 123 degrees east longitude in order to maintain its right to the slot under International Telecommunication Union (ITU) regulations.
     
    After the Garuda-1 satellite was retired following multiple malfunctions, the Defense Ministry took over control of the orbital slot from the Communications and Information Ministry in 2015. It sought to launch a defense communications satellite and signed a lease on the Artemis satellite owned by the United Kingdom’s Avanti Communications.
     
    The strategic satellite slot, reserved for the L-Band frequency, is suitable for military communications and navigation and is located on the equator above Sulawesi. Indonesia currently has seven orbital slots of various frequency bands, which are used for various purposes, including Earth monitoring.
     
    The lease with Avanti was signed on Dec. 5, 2015, before the Communications and Information Ministry gave the Defense Ministry the rights to manage the slot on Jan. 29, 2016.
     
    The Defense Ministry, then led by Ryamizard Ryacudu, signed contracts with other satellite operators, including Navayo, Airbus, Detente, Hogan Lovel and Telesat, even though it lacked the budget approval to do so, said Coordinating Political, Legal and Security Affairs Minister Mahfud MD. 
     
    “The government is now facing court orders to pay a very large amount of money, even though these obligations were made based on a decision by the Defense Ministry in 2015 that was procedurally and legally wrong,” he said at a press briefing on Thursday. “[The ministry] signed a contract with a number of satellite operators, even though the budget did not yet exist.”
     
    Avanti sued the government at the London Court of International Arbitration over the ministry’s failure to pay US$16.8 million of a $30 million lease contract. The court ruled in July 2019 that Indonesia would have to pay the outstanding sum to the company. The legal battle cost the country Rp 515 billion ($36 million).

Read also: Strategic orbital slot hangs in balance

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Navayo, meanwhile, submitted an invoice of $16 million to the Defense Ministry, but the government refused to pay, leading to another lawsuit through the Singapore Arbitration Court. In May of last year, the court ordered the ministry to pay it, along with additional legal fees, costing the country $20.9 million.

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