Law and Compliance in Indonesia

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Business Contract

General Observation
The principle of contractual freedom is preferred, but for a contract to be valid, the contracting parties must agree on the content of the contract, be able to draw up a contract and carry out the legal measures without the assistance of a third party; the object of the contract must be clearly determined and the content must conform to the applicable laws.
Law Applicable to the Contract
Contract law is governed by the Civil Code.
Language of Domestic Contract
Indonesian (and/or English)
Other Laws Which Can Be Used in Domestic Contracts
Indonesia has not ratified the Vienna Convention on contracts; the Indonesian Civil Code must be applied.

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Legal Framework of Business

Equity of Judgments

Independence of Justice
The judiciary is not completely independent in Indonesia. 
Equal Treatment of Nationals and Foreigners
Foreign nationals in the country cannot expect a fair trial from the country’s judicial system.
The Language of Justice
The judicial language in the country is Bahasa Indonesia.
Recourse to an Interpreter
Having an interpreter is always possible.
Legal Similarities
The main source of the law is the constitution of 1945 which has gone through a series of amendments. The country’s legal system is based on Roman-Dutch law, again modified several times. The country does not accept compulsory ICJ jurisdiction. 

The Different Legal Codes

Penal Code
Criminal law
Civil Code Contract law
Commercial Code Commercial law
Checking National Laws Online
Information and database on Indonesian laws
Other Useful Resources
Hukum on line, Information website on Indonesian law.
Country Guides
Lexmundi, Guide to doing business in Indonesia: legal system.

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The Jurisdictions

Mahkamah Agung (Supreme Court) The highest legal authority, it subordinates the Tribunal of Commerce, the Religious Tribunal, the Military Tribunal, the State Administrative Tribunal
Pengadilan Tinggi (Court of Appeal) District court of appeal (about 20)
Pengadilan Negeri (County court) County court (about 250)
Pengadilan Niaga (Tribunal of commerce) Bankruptcy, insolvency, commercial disputes
Pengadilan Tata usaha negara (State Administrative Tribunal) Administrative disputes against the government
Mahkamah Konstitusi (Constitutional Court) Constitutionality, elections, dissolving political parties

Court Officials

Notaris (notary)
Semi-public appointee of the Ministry of Justice andHuman Rights, in charge of authenticating and registering deeds
Pengacara (lawyer)
Informs his clients about their rights and obligations, and represents them in court with a speech for the defense.
Penghukum (judge)
Decides if a crime has been committed, and if so the penalties which are applicable
Konsultan hukum (consultants)
Most of them are lawyers; they offer counselling services to banks, companies, etc.
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