PT Garuda Indonesia Ltd v Australian Competition and Consumer Commission

In the Federal Court of Australia, PT Garuda Indonesia Ltd has applied for a stay of appeal proceedings due to its failure to comply with a pecuniary penalty order issued by the Court. The Australian Competition and Consumer Commission (ACCC) opposes the stay. The penalties were due on 27 June 2019, but Garuda did not make the payment. After further correspondence, it became clear that Garuda was not going to comply with the penalty order. Garuda argued that its failure to comply was not due to an inability to pay, but rather a decision not to comply with the Court’s order. The ACCC understood this as an indication that Garuda had made a conscious decision not to comply with the Court’s order.

The legal issues before the court involved the power of the Court to control its own proceedings and whether Garuda's failure to comply with the pecuniary penalty order constituted contempt. Garuda argued that it is a separate entity of Indonesia, and under Indonesian law, the Indonesian Government might not be able to authorise the payment of moneys that would compromise Garuda's purpose or ability to benefit the Indonesian public. The court needed to determine whether Garuda had the legal capacity to comply with the pecuniary penalty order and if there was any evidence to suggest that Garuda had the practical capacity to comply with the order.

The court dismissed Garuda's amended interlocutory application for a stay of appeal proceedings. It found that Garuda's failure to comply with the pecuniary penalty order constituted contempt. The court also granted Garuda leave to amend its notice of appeal by adding a ground of appeal that the Court had erred by including the words "within 28 days" in the penalty order. The ACCC was ordered to pay Garuda's costs of the interlocutory application.