Trade Disputes in Indonesia

Overview by
The parties to a commercial agreement or other transaction can resort to the Indonesian Arbitration Tribunal (BANI), to resolve a dispute on the basis of good will and non-confrontation.
Arbitration Law
Law n°30 of 1999 concerning arbitration and alternative solutions for conflict resolution governs questions of arbitration.
Conformity to International Commercial Arbitration Rules
Party to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.
Party to the Geneva Protocol on Arbitration Clauses.
Party to the Geneva Convention of the Execution of Foreign Arbitral Awards.
Appointment of Arbitrators
The number of arbitrators is not fixed and it is the President who chooses in case of disagreement between the parties.

If there is only one, the plaintiff can suggest to the President of the Arbitration Tribunal one or several people who correspond to the necessary criteria to be arbitrators. If the respondent accepts the plaintiff's candidate, with the President's agreement this person will be designated sole arbitrator. If none of the candidates suggested by the plaintiff suits the respondent, either the parties agree to form a Tribunal of three arbitrators, or the President designates an individual.

If the Tribunal is made up of three arbitrators, one is appointed by each of the parties, and the President appoints an arbitrator (from the official list) to preside over the Tribunal, taking into account the preferences of the parties.

If there are more than two parties, the plaintiffs are considered to be a sole plaintiff, and the respondents considered to be a sole respondent. If the parties do not agree on the choice of their respective arbitrators, the choice is left to the President to designate more than three arbitrators if the complexity of the case requires it.

Arbitration Procedure
The request for arbitration made by the plaintiff, who specifies the name of the chosen arbitrator, is registered by the BANI secretariat, as well as the response of the respondent which must be formulated within thirty days.


The Tribunal encourages an amicable resolution of the dispute, and provides assistance if necessary. If an amicable agreement can be obtained, the Tribunal writes a memorandum which has the same force as an arbitration ruling.

If no agreement is reached, the procedure continues. If the plaintiff does not attend the first hearing without a legitimate reason, the Tribunal can cancel the request for arbitration. If the respondent does not attend or does not submit his written defense, after two reminders the Tribunal can give its decision on the basis of arguments and evidence provided by the plaintiff.

After the conclusions of the hearing have been given, the President of the Tribunal decides on a hearing to give his final decision, which must be delivered within thirty days of the hearing, unless a longer period of time is justified. The final decision is binding. The Tribunal can set a deadline for the loser to carry out the decision, and lay down penalties if it is not carried out.

Permanent Arbitration Bodies
Indonesian national bureau of arbitration (BANI) (Sectors Covered: Sectors of commerce, industry, finance, relating to companies, insurance, financial institutions, aviation, telecommunications, mines, air and sea transport, intellectual property rights, manufacturing, licenses, franchises, construction, the environment...)

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