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Many firms prefer to go to arbitration to settle disputes
Many Indonesian companies now prefer to go to international arbitration panels when settling business disputes with foreign partners, rather than going to local courts, a senior official of the Indonesian National Board of Aribitration (BANI) says
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any Indonesian companies now prefer to go to international arbitration panels when settling business disputes with foreign partners, rather than going to local courts, a senior official of the Indonesian National Board of Aribitration (BANI) says.
BANI chairman Husseyn Umar, who is also a member of the ICSID Panel of Conciliators and Arbitrators in Washington D.C., told The Jakarta Post following a seminar on arbitration practices in Jakarta on Monday that arbitration had become more popular among Indonesian companies as a means of resolving disputes after the enactment of the 1999 Indonesian Arbitration Law.
He said business players would rather to go to arbitration to settle business disputes because it offered many advantages.
“Parties who decide to settle their disputes through arbitration have, for example, the freedom to ‘customize’ their arbitration by choosing the arbitrator, rules and procedures, and place of arbitration,” he said.
Husseyn said arbitration was also a less formal means of resolution that provided flexibility towards a settlement.
He said dispute resolution through arbitration was faster than the courts due to the fact that a settlement had to be decided within 180 days as stipulated by the Indonesian Arbitration Law.
“It’s not only fast, but also efficient,” he said, adding that foreign companies in Indonesia remained skeptical about resolving their disputes through the local court because of problems such as corruption.
Moreover, he said, the arbitration verdict was final and binding. “Once reconciliation is reached, the settlement is final and binding. Thus, the parties should fulfill the provisions of the reconciliation as imposed by the settlement,” he added.
Husseyn said Indonesia was becoming more international arbitration-friendly due to the fact that
of the 22 international arbitration verdicts registered at the Central Jakarta District Court between 2003 and 2009, 20 were granted with approval for enforcement.
The Central Jakarta District Court is the only body with the authority to handle recognition and enforcement of foreign arbitration verdicts.
“It shows that Indonesia is better acquainted with the international arbitration,” he added.
Acting chairman of the Indonesian Chamber of Commerce and Industry (Kadin), Adi Putra Taher, agreed, saying many Indonesian companies now preferred to settle disputes through arbitration process. “They’d like to resolve disputes first through arbitration. It provides quick resolution. Moreover, arbitration is conducted confidentially. The cases aren’t exposed to the media,”
he said. (ebf)
