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PT Indo RX backs German arbitration ruling, urges all parties to respect the decision
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PT Indo RX backs German arbitration ruling, urges all parties to respect the decision.
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T Indo RX, an Indonesia-based company, extends its highest appreciation for the fair and professional decision issued by the German Arbitration Institution (Deutsche Institution für Schiedsgerichtsbarkeit / DIS) in the legal dispute between PT Indo RX and Rhenoflex GmbH, a company based in Germany. The arbitration panel ruled in favor of PT Indo RX and declared that the unilateral termination of the partnership by Rhenoflex GmbH was legally invalid.
The arbitration panel, consisting of Joseph Schwartz, Paul Hauser and Andreas Heinrich, issued its final and binding decision on March 6, 2025. In its ruling, the panel stated that the termination letter dated Jan. 11, 2024, sent by Rhenoflex GmbH, using the letterhead of “Coats Footwear”, a brand of Coats Group plc, lacked legal grounds and was therefore declared invalid.
For over 14 years, PT Indo RX and Rhenoflex GmbH maintained a partnership in the footwear components industry, with PT Indo RX handling production and marketing in Indonesia, while Rhenoflex GmbH supplied raw materials. This collaboration contributed significantly to both parties, including the successful export of hundreds of millions of pairs of globally branded shoes, especially Nike, without a single breach of contract, even during the COVID-19 pandemic.
The issue arose after United Kingdom-based Coats Group plc acquired Rhenoflex GmbH through its subsidiary, Coats Industrial Thread Holdings, in August 2022. Without any breach of contract by PT Indo RX, Rhenoflex GmbH abruptly terminated the partnership unilaterally and ceased supplying raw materials. This action crippled PT Indo RX’s operations and resulted in job losses for skilled and dedicated workers. Furthermore, senior officials of Coats Group plc attempted to take over PT Indo RX’s customers and footwear component business by supplying similar components from China.
Tama S. Langkun, legal counsel for PT Indo RX, expressed hope that all parties would comply with the ruling. “This decision is not only a legal victory for our client, but also a form of protection for the integrity of Indonesian businesses in the global arena. We hope Rhenoflex and Coats Group will promptly comply with the decision in full, restore the original state of affairs and take responsibility for all damages caused.”
“With this arbitration ruling, PT Indo RX calls on Rhenoflex GmbH and Coats Group plc to fully comply with the arbitration decision, which is final and binding. Additionally, PT Indo RX demands that all aspects of the partnership be reinstated to their original state before the unlawful unilateral termination. PT Indo RX also seeks compensation for all damages resulting from these actions,” Tama said.
PT Indo RX remains committed to lawful and ethical business practices. The company encourages all parties involved to respect and comply with this legal decision in order to maintain trust and credibility in business collaborations, both in Indonesia and globally.
