Dispute Resolution through BANI (Indonesia National Arbitration Board)

Basically, commercial disputes can be proceed through the court or arbitration forums, where both types have different mechanisms and conditions. The mechanism through arbitration forums (generally) refers to the provisions of Law No. 30 of 1999 concerning Arbitration and Alternative Dispute Resolution (“Law No. 30/1999”).

According to the provisions of Article 1 No. 1 Law No. 30/1999 is stated explicitly as follows:

Arbitration is a method of resolving a civil dispute outside the general court based on an arbitration agreement made in writing by disputing parties“.

So it is expressly stated that the arbitration forum is only intended for civil or commercial disputes and the forum for dispute resolution through arbitration must be stated in an agreement made by the parties. The arbitration agreement is referred Article 1 number 3 of Law No. 30/1999, as follows:

An arbitration agreement is an agreement in the form of an arbitration clause stated in a written agreement made by the parties before a dispute arises, or a separate arbitration agreement made by the parties after the dispute arises”.

The requirements for registering an arbitration application in BANI refer to the provisions of Article 16 of the BANI Procedure Regulations, as follows:

  1. The Application (lawsuit) Letter must attach an agreement containing an arbitration clause and a sufficient copy to be made to the relevant parties.
  2. Application Letter must at least contain:
  • Name and address of the parties;
  • Information about facts supporting the Application for Arbitration;
  • Points of case; and
  • The amount of compensation claims demanded.

3. The applicant (plaintiff) may also attach other documents relating to the dispute

The process of BANI arbitration proceedings is carried out efficiently and effectively, where the parties simply submit documents through the secretary without trial session. The Panel of arbiter will hold a hearing if the agenda of witness by the parties

BANI decision can only be executed if the Decision has been registered to the District Court based on the Respondent’s domicile, the registration process can be conducted by the Secretary of BANI or by the parties directly to the court.

Official Costs for BANI Process

BANI have stipulated official cost to process the dispute through BANI, which these costs should be paid by the parties, as follows:

  • Administration Cost

Administration should be paid when the parties (one of party) register the lawsuit/petition, in amount Rp. 2,000,000. After make the payment, BANI will issued receipt along with description and number of case

  • Cost for dispute settlement

This will be variable depend on the amount of compensation, start from 0,5% – 10% from amount of compensation which requested by Plaintiff in the lawsuit. This cost should be paid before BANI will examine the case and appointed panel of arbiter. The detail of amount can be checked in BANI official website.

  • Additional/Operational Cost

The parties should pay additional costs if only there is several necessary based on request by the parties, for example accommodation and transportation for arbiter who domiciled outside Jakarta (Jabodetabek), cost for expert if the parties request to panel of arbiter to present the expert, cost registration the verdict to the relevant District Court based on request by the parties.

All of payment by the parties will be provided receipts also detail description by BANI Secretary. The payment may be transferred to BANI official account or cash through BANI Office.

author: Wilopo Husodo




Published by Husodo and Partners


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