JAKARTA - INDONESIA'S Supreme Court has rejected an appeal filed by Singapore's investment firm Temasek Holdings over a ruling that it breached anti-monopoly laws, the court spokesman said on Friday.

'Yes, it's true,' Mr Djoko Sarwoko, one of the judges who heard the case, said, confirming the ruling.

The court's spokesman, Mr Nurhadi, later told reporters 'there are no other legal remedies or appeals' for Temasek.

Temasek said it had not broken the law and appealed to the top court in May after the Central Jakarta district court upheld a ruling by the competition watchdog and ordered it to divest its holdings in either PT Telkomsel or PT Indosat. They are Indonesia's two largest mobile operators, by subscribers.

'The appeal was not convincing,' Supreme Court chief Bagir Manan said, as quoted by the state Antara news agency.

The watchdog, KPPU, ruled in November that Temasek was guilty of engaging in monopolistic practices and anti-competitive behaviour in Indonesia's cellular phone market through stakes in the two telephone operators.

Analysts warned after the KPPU ruling that the decision was nonsensical and would dampen already lacklustre foreign investor sentiment.

In Singapore, Temasek issued a brief statement saying it was 'disappointed with the verdict'.

In June, Singapore Technologies Telemedia (STT), a wholly-owned unit of Temasek, sold off its interest in PT Indosat to business partner Qatar Telecom.

The Qatari firm bought the 40.8 per cent stake in Indosat from Asia Mobile Holdings Pte Ltd for 1.8 billion US dollars (S$2.6 billion) . STT holds 75 per cent of Asia Mobile Holdings.

'As far as whether Q Tel stock can be bought or not, that is not the Supreme Court's affair,' Mr Nurhadi said.

Temasek indirectly holds 35 per cent of PT Telkomsel via its 56-per cent owned unit Singapore Telecommunications Ltd (SingTel).

Temasek had argued it 'does not own shares in or control either Indosat or Telkomsel, whether directly or indirectly through its subsidiaries.' Singapore's Temasek has controlling stakes in major regional firms and has invested billions of dollars in troubled US investment bank Merrill Lynch since late last year.

It is one of two Singapore government investment vehicles, along with the Government of Singapore Investment Corporation. -- AFP