Petitioner Togi Pangaribuan (right), during the ruling hearing on the judicial review petition of Law No. 30 of 1999 on Arbitration and Alternative Dispute Resolution (AAPS Law), Friday (1/3/2025) in Courtroom. Photo by MKRI.

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JAKARTA (MKRI) — International Arbitration Awards refer to the awards rendered by an arbitration institution or individual arbitrator outside the jurisdiction of the Republic of Indonesia or those considered non-domestic arbitral awards. This is the Court’s new interpretation of the norm in Article 1 point 9 of Law No. 30 of 1999 on Arbitration and Alternative Dispute Resolution (AAPS Law). In Decision No. 100/PUU-XXII/2024, the Court partially granted the petition filed by Togi M. P. Pangaribuan, with Chief Justice Suhartoyo delivering the verdict on Friday, January 3, 2025.

In the legal considerations delivered by Justice Ridwan Mansyur, the Court emphasized the word ‘deemed’ (Indonesian: ‘dianggap’) in the phrase “which under the general provisions of the Republic of Indonesia is ‘deemed’ an international arbitral award.” The Petitioner considered this word to cause legal uncertainty. Based on the Indonesian Language Dictionary, the word ‘dianggap’ which is derived from ‘anggap’ has several word equivalents, i.e., ‘kira’, ‘sangka’, ‘taksir’, ‘tebak’, ‘terka’, and ‘duga’ (synonymous to “guess,” “estimate,” and “surmise”). Thus, in general, these words refer to something unclear or subject to change depending on its information and facts.

As such, Justice Ridwan said that using clear words in drafting laws and regulations is essential to provide legal certainty, prevent ambiguity and legal abuse or loopholes, and ensure the consistent implementation of such regulations. The Court viewed the most rational option to achieve fair legal certainty on the definition, scope, and limitations of non-domestic arbitral awards under Article 1 point 9 of the AAPS Law is to eliminate the word ‘deemed’.

“In the absence of the word ‘deemed’ in a quo norm, the existence of the phrase “or according to the general provisions of the Republic of Indonesia as an international arbitration award’ is to strengthen the territorial concept in the phrase “an award rendered by an arbitration institution or individual arbitrator outside the jurisdiction of the Republic of Indonesia.” This phrase means that the definition and scope of arbitral awards in Indonesia are based on the territorial concept and other factors stipulated by laws and regulations,” Justice Ridwan stated.

Non-Domestic Arbitration Awards Parameter

Justice Ridwan further explained that the Court provides guidelines and limitations to serve as the main principle in the formation of law, particularly that of international arbitration awards. The limitations include Indonesian sovereignty, national economic interests, effective and efficient dispute resolution, and mutual benefit in international cooperation. Harmonizing national and international laws is also necessary to maintain Indonesia’s place in international legal relations, especially in dispute resolution through arbitration, and to provide fair legal certainty in achieving the country’s social welfare.

Justice Ridwan emphasizes the significance of such parameters as part of the recognition and implementation of international arbitration awards, considering its broad scope, i.e., regulations in the trade and investment sector, including mineral, coal mining, and others within the scope of international trade.

“Based on such legal considerations, the word ‘deemed’ in the norms of Article 1 number 9 of Law No. 30 of 1999 has caused legal uncertainty guaranteed in the 1945 Constitution as argued by the Petitioner. However, considering it is not what is requested by the Petitioner in his petition, the Petitioner’s argument is partially reasonable according to law,’ said Justice Ridwan.

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The Petitioner argued that Article 1 point 9 of the AAPS Law, specifically the phrase “which under the provisions of the law of the Republic of Indonesia is deemed as an international arbitral award,” is contrary to Article 28D paragraph 1 of the 1945 Constitution. He experienced actual and specific constitutional losses in several aspects, including in his profession as a lecturer, where he has an obligation to teach arbitration law in theory and practice to students accurately.

While in the Petitioner’s profession as an advocate, he is obliged to provide legal services in the form of litigation services and advice to clients. The legal uncertainty in the AAPS Law has hindered the Petitioner from carrying out both professions. This is because it mixes up narrow and broad territorial concepts, so the Petitioner has difficulty determining which ones are classified as national arbitration awards and international arbitration awards based on Article 1 point 9 of the AAPS Law. (*)

Author            : Sri Pujianti
Editor             : Lulu Anjarsari P.
PR                 : Fauzan Febriyan
Translator      : Ryan Alfian/Rizky Kurnia Chaesario

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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