Fikri Habibi delivering the Supreme Court’s testimony on the continued judicial review hearing of Law No. 37 of 2004 on Bankruptcy and Debt Payment Postponement, Tuesday (17/12), at the Courtroom. Photo by MKRI/Ifa.

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Jakarta (MKRI) – The Constitutional Court held another material judicial review hearing of Law No. 37 of 2004 on Bankruptcy and Debt Payment Postponement (Bankruptcy Law) on Tuesday, December 17, 2024, at the Plenary Courtroom. The petition was filed by Aniek Trisolawati and Idha Achira Handajanti, housewives, and Indri Marini Akbar and Donny, private employees. The Petitioners felt harmed due to the bankruptcy process of PT. Crown Porcelain and PT. Cakrawala Bumi Sejahtera, developers of the Apartement Point 8. They requested that the bankruptcy process be carried out faster and more transparently.

The agenda of the hearing of Case No. 112/PUU-XXII/2024 was to hear testimony from the Supreme Court (SC) and the Petitioners’ expert. In the hearing led by Chief Justice Suhartoyo, the SC, represented by Fikri Habibi, stated that time certainty in the bankruptcy assets settlement is an important factor for business. Uncertainty in the bankruptcy settlement may negatively impact their interest directly or indirectly. The longer the settlement process, the higher the cost and the risk of negative sentiment on the assets and related entities. It also directly affects business climate assessment in Indonesia as indicated by business ready or be ready that the World Bank uses to assess parameters of a country's investment and business climate.

“The time limit proposed by the Petitioners regarding Article 74 paragraph (1) and paragraph (3) and Article 185 paragraph (3) of Law No. 37 of 2004 on the Bankruptcy and Debt Payment Postponement is rational to consider after paying attention to the implementation possibility and comparing the regulation in several other countries. The limitation must reflect and consider the principles of legality, efficiency, certainty, and rights protection of all parties. Several countries have implemented time limitations as proposed with various limitations. The determination of the time limitations must also consider related factors,” he said.

Hence, Fikri added, a three-year limitation with a two-year extension is an ideal grace period for curators to do their jobs.

Time Limitation Needed

Meanwhile, the Petitioners’ expert, Ismail, stated that the establishment of the Bankruptcy Law is to achieve a just and welfare society based on Pancasila and the 1945 Constitution of the Republic of Indonesia. Therefore, a legal instrument is needed to resolve debt issues in a just, fast, transparent, and effective manner.

However, the implementation has resulted in the opposite of what was expected. This is seen in the provisions of Article 74 paragraph (1) of the Bankruptcy Law, which states that curators must submit a report to the supervising judge on the status of the bankruptcy assets and the execution of their duties every three months.

According to Ismail, the provisions of Article 74 paragraph (1) and paragraph (3), Article 185 paragraph (3) of the Bankruptcy Law contradict the basic norms stipulated in the Provisions of Article 1 paragraph (3) and Article 28D paragraph (1) of the 1945 Constitution. Therefore, according to Ismail, the articles need to add norms regarding time limitations to ensure curators’ legal certainty in carrying out their obligations.

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Several apartment buyers challenged Article 74 paragraph (1) and (3) juncto Article 185 paragraph (3) of Law No. 37 of 2004 on Bankruptcy and Suspension of Debt Payment Obligations (Bankruptcy and PKPU Law). The petitioners of case no. 112/PUU-XXII/2024 are Aniek Trisolawati, Idha Achira Handajanti (housewives), and Indri Marini Akbar and Donny (private employees). Petitioners felt harmed due to the bankruptcy of PT Crown Porcelain and PT Cakrawala Bumi Sejahtera, as developers of Point 8 Apartment, located in Jalan Daan Mogot KM 14, Cengkareng, West Java. They asked that the bankruptcy process could be carried out faster and transparently.

At the preliminary hearing on Monday, September 2, legal counsel Heriyanto said the Petitioners hadn’t been made aware of the deadline set for the curator team of the bankrupt debtors of PT Crown Porcelain and PT Cakrawala Bumi Sejahtera to liquidate bankruptcy estate. They believe the certainty of the time frame in the liquidation of a bankrupt estate should start with a predetermined time limit for every stage of the bankruptcy process.

The firm deadline would circumvent ambiguous interpretations and provide clear guidance for all parties involved. The lack of such a time frame could lead to confusion, anxiety, and even prolong the financial stress that the debtor may face, especially if there is delay in the selling or division of assets.

In the revised petitums, the Petitioners request that the Court declare Article 74 paragraph (1) of the Bankruptcy and PKPU Law (“The Curator shall submit to the Supervisory Judge its report concerning the condition of bankruptcy estate and the performance of its duties once every 3 (three) months”) unconstitutional and not legally binding if not interpreted as “The Curator shall submit to the Supervisory Judge its report concerning the condition of bankruptcy estate and the performance of its duties once every 3 (three) months and shall complete the liquidation of bankruptcy estate and the performance of all of its duties at the latest within 3 (three) years since the bankruptcy decision is pronounced.”

They also ask the Court to declare Article 74 paragraph (3) of the Bankruptcy and PKPU Law (“The Supervisory Judge may extend the report period as referred to in paragraph (1)”) unconstitutional and not legally binding if not interpreted as “The Supervisory Judge may only extend the reporting period as referred to in paragraph (1) for a maximum of 1 (one) month.”

They also request that Article 185 paragraph (3) of the Bankruptcy and PKPU Law (“Concerning all goods that are not immediately or cannot be completely liquidated, the Curator shall take a decision in the manner which is approved by the Supervisory Judge”) be declared unconstitutional and not legally binding if not interpreted as “Concerning all goods that are not immediately or cannot be completely liquidated within a maximum of 2 (two) years, the Curator shall take a decision in the manner which is approved by the Supervisory Judge.”

Author: Utami Argawati
Editor: N. Rosi.
PR: Fauzan F.
Translators: Rizky Kurnia Chaesario/Yuniar Widiastuti

Disclaimer: The original version of the news is in Indonesian. In case of any differences between the English and the Indonesian versions, the Indonesian version will prevail.

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