Execution of Foreign Court Decision in Indonesia, This is the Regulation

PERTANYAAN

Can a foreign court decision be executed in Indonesia? If so, what is the procedure, and please provide information on the regulations governing it.

INTISARI JAWABAN

Every country in the world has a different legal constitution that has been adapted to the customs of the people living in it in order to maintain public order. However, in the era of increasingly sophisticated technology, it is possible for people with different nationalities to establish cooperation that creates legal relations between them.

Therefore, if the cooperating parties have agreed that the dispute settlement will be resolved through a foreign court and will be executed by the parties, then, can the foreign court's decision be implemented in Indonesia? If so, what is the procedure and what is the legal basis?

Please read the review below for a further explanation.

 

ULASAN LENGKAP

This article is an English translation of Eksekusi Putusan Pengadilan Asing di Indonesia, Ini Aturannya written by Bosni Gondo Wibowo, S.H., LL.M. from Altruist Lawyers and published on Tuesday, 14 March 2023.

The article below is an update of the article entitled Execution of Foreign Court Decision (Eksekusi Putusan Pengadilan Asing) created by Diana Kusumasari, S.H., M.H. and first published on Tuesday, 8 February 2011.

All legal information available on Klinik hukumonline.com has been prepared for educational purposes only and is general in nature (read the complete Disclaimer). In order to obtain legal advice specific to your case, please consult with Justika Partner Consultant.

Execution of Foreign Court Decision

Mrs. Sut. Girsang in a book entitled Arbitration Volume I (Arbitrase Jidil I), explains that a court decision is a reflection of the sovereignty of a country. Therefore, a judgment or decision issued by one country can only be executed in that country and cannot be executed in another country. This is contained in Article 436 R.V which explains that a foreign court decision cannot be enforced in Indonesia because it does not have executorial power.

If the parties to an agreement whose parties come from two or more different countries agree that the settlement of disputes arising will be resolved through a foreign court and will be executed by the parties, still the foreign judgment arising from the agreement will only be respected and will be used as a "fact" in the form of a decision that does not follow the judge in Indonesia. Then, to be executed, the decision must be re-examined from the initial process until finally a valid decision is issued.[1]

The request for re-examination is allowed under Indonesian law, as stated in Article 134 R.V which reads:

(s.d. u. dg. S. 1901-15; S. 1908-522. ) Cases that have previously been litigated before another judge between the same parties on the same subject of dispute or which have been referred by the same parties on the same subject of dispute to referees and are still ongoing, or in the case of a dispute which is closely related to a case already in the hands of another judge or in the hands of referees, it may be requested that the case be delegated to the other judge or to the referees who have been appointed. This must be done by a well-founded request before the plea is made on the day appointed for the plea. (s.d. tg. S. 1908-522.) The delegation can also be requested by the plaintiff, but only at the stage of the conclusion of the lawsuit. (KUHPerd./ Civil Law Code 1197; Rv. 95, 99, 128, 270, 279, 349, 436, 615.)

Furthermore, after the verdict has permanent legal force, execution can only be carried out in accordance with the procedures for executing court decisions in general as stated in Article 195 HIR up to Article 224 HIR.

Execution of Foreign Arbitral Decision

Unlike the execution of foreign court decisions, a foreign arbitral decision can actually be directly registered for execution, as stated in Article 67 section (1) Law 30/1999 or the Arbitration Law and Article 5 section (1) Regulation of the Supreme Court 1/1990. This is because Indonesia has ratified the Convention on the Recognition and Enforcement of Foreign Arbitral Awards which was signed in New York on June 10, 1958,[2] and the information regarding the ratification is stated in Regulation of the President 34/1981.

However, it should be underlined that the nomination for the formation of the regulation is given some appropriate restrictions to maintain the constitution in Indonesia. Quoting Article 66 Arbitration Law, international arbitration decisions are only recognized and can be implemented in the jurisdiction of the Republic of Indonesia if they meet the following conditions:

1. International Arbitral Award was rendered by an arbitrator or arbitral tribunal in a country that is bounded with Indonesia through an agreement, either bilaterally or multilaterally, concerning the recognition and execution of an International Arbitral Award;
2. International Arbitral Award as referred to in letter a is limited only to award, of which according to the provisions under Indonesian law, is covered in the scope of trade law;
3. International Arbitral Award as referred to in letter a which may only be executed in Indonesia is limited to award that is consistent with the public order;
4. International Arbitral Award may be executed in Indonesia after securing the exequatur from the Chief of Central Jakarta District Court; and
5. International Arbitral Award as referred to in letter a which involves the State of the Republic of Indonesia as one of the disputing parties, may only be executed after securing the exequatur from the Supreme Court of the Republic of Indonesia which will be delegated to the Central Jakarta District Court.

According to Yahya Harahap in his book entitled Arbitration, the procedure for executing foreign arbitration decisions follows the provisions stipulated in the HIR as stated in Article 195 HIR up to Article 224 HIR. With this, it means that the execution of foreign arbitration decisions is the same as the procedure for executing ordinary decisions that apply to the execution of court decisions in general (p. 374).

Procedurally, a foreign execution award must go through several processes to be recognized for its validity, as stipulated in Article 66 Arbitration Law. However, if the foreign arbitral decision concerns the Republic of Indonesia as one of the parties to the dispute, then the execution can only be issued by the Supreme Court and then delegated to the Central Jakarta District Court for execution.[3]

Mrs. Sut. Girsang in the same book also explains that arbitration decisions have executoriale kracht which means that before the decision is executed, exequatur must first be given. Then, to obtain an exequatur, Article 66 Arbitration Law and Article 4 Regulation of the Supreme Court 1/1990 emphasize that foreign arbitration decisions must not conflict with the basic principles of the entire legal system and society in Indonesia, namely public order.

Also read: The Position of National and International Arbitral Decision

Thus, if the foreign arbitral decision concerns the Republic of Indonesia as one of the parties to the dispute, then based on Article 5 section (1), (2), and (3) of Regulation of the Supreme Court 1/1990, the steps in determining exequatur are as follows:

1. An application for the execution of a Foreign Arbitration decision can only be made after it has been registered at the Registrar's Office of the Central Jakarta District Court, in accordance with the applicable procedures according to Article 377 RID/Article 705 of the Regulations for Regions Outside Java and Madura;
2. The Head of the Central Jakarta District Court mentioned in paragraph 1 sends the application file for the execution of the Foreign Arbitration to the Registrar/Secretary General of the Supreme Court to obtain Exequatur;
3. The delivery of the petition file to the Supreme Court shall be carried out no later than 14 (fourteen) days from the date of receipt of the petition.

After a series of processes above are completed, the Supreme Court will directly determine the exequatur which is then submitted to the Central Jakarta District Court.[4]

Requirements for Registration of Foreign Arbitral Decisions

At the registration stage, Foreign Arbitration decisions can only be made after being registered at the Registrar of the Central Jakarta District Court, as written in Article 59 section (1) and (2) Arbitration Law which reads:

Section (1)

Within a maximum period of 30 (thirty) days from the date the decision is pronounced, the original sheet or an authentic copy of the arbitral decision shall be submitted and registered by the arbitrator or his attorney to the Registrar of the District Court.

Section (2)

The delivery and registration as referred to in paragraph (1), shall be carried out by recording and signing at the end or on the margin of the decision by the Registrar of the District Court and the arbitrator or his proxy delivering it, and such record shall constitute a deed of registration.

Furthermore, there are several technical requirements that need to be noted in the submission of the registration and delivery of the application file in accordance with Article 5 section (4) Regulation of the Supreme Court 1/1990, namely:

The submission of the application file must be accompanied by:

1. The original of the decision or a derivative of the Foreign Arbitration decision that has been authenticated in accordance with the provisions regarding the authentication of foreign documents, as well as its official translation, in accordance with the provisions of applicable law in Indonesia.
2. Original agreement or derivative agreement which is the basis of the Foreign Arbitration decision that has been authenticated in accordance with the provisions regarding the authentication of foreign documents, as well as its official translation, in accordance with the provisions of applicable law in Indonesia.
3. A statement from the Indonesian diplomatic representative in the country where the Foreign Arbitration decision is rendered, stating that the applicant country is bound bilaterally with Indonesia or jointly bound with Indonesia in an international convention regarding the recognition and enforcement of a Foreign Arbitration decision.

For information, if the decision is made outside the jurisdiction of the Central Jakarta District Court, then the panel of judges of the Central Jakarta District Court will immediately forward it to the District Court that has relative authority.[5]

Also read: Not Fulfilling These Requirements and Procedures, Foreign Arbitration Decisions Are at Risk of Not Being Executed

In conclusion, court decisions are a reflection of state sovereignty, so decisions issued by one country can only be implemented in that country and cannot be implemented in other countries. To execute a foreign court decision, the decision must be re-examined until finally a decision is issued and has permanent legal force. After that, new executions can be carried out. Meanwhile, a foreign arbitral decision can be directly registered for execution, which of course must meet the technical requirements for filing registration and sending files for execution.

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These are the answers we can provide, we hope you will find them useful.

Legal Basis:

1. Herzien Inlandsch Reglement;
2. Reglement op de Rechtsvordering;
3. Law Number 30 of 1999 on Arbitration and Alternative Dispute Settlements;
4. Regulation of the President Number 34 of 1981 on the Ratification of ‘Convention on the Recognition and Enforcement of Foreign Arbitral Awards’ signed in New York on 10 June 1958 and has come into force on 7 June 1959;
5. Regulation of the Supreme Court Number 1 of 1990 on Procedure for the Execution of Foreign Arbitral Decisions;
6. Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

Reference:

1. M. Yahya Harahap, Arbitrase Cet. 1. Jakarta: Pustaka Kartini, 1991;
2. Mutiara Hikmah. Pengakuan dan Pelaksanaan Putusan Arbitrase Asing di Indonesia. Jurnal Hukum Internasional, Vol. 5, No. 2, 2008;
3. Ny. Sut. Girsang. Arbitrase Jilid I. Jakarta: Mahkamah Agung-RI, 1992;
4. Viva Orchita (et.al). Pelaksanaan Putusan Pengadilan Asing Di Indonesia (Studi Loan Agreement antara Republik Indonesia Dan Nordea Bank Danmark A/S (Denmark)). Diponegoro Law Journal, Vol. 5, No. 4, 2016.

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[1] Viva Orchita (et.al). Pelaksanaan Putusan Pengadilan Asing Di Indonesia (Studi Loan Agreement antara Republik Indonesia Dan Nordea Bank Danmark A/S (Denmark)). Diponegoro Law Journal, Vol. 5, No. 4, 2016, p. 15.

[2] Mutiara Hikmah. Pengakuan dan Pelaksanaan Putusan Arbitrase Asing di Indonesia. Jurnal Hukum Internasional, Vol. 5, No. 2, 2008, p. 322.

[3] Article 66 letter e Law Number 30 of 1999 on Arbitration and Alternative Dispute Settlements (“Law 30/1999”).

[4] Article 6 section (1) Regulation of the Supreme Court Number 1 of 1990 on Procedure for the Execution of Foreign Arbitral Decisions (“Regulation of the Supreme Court 1/1990”).

[5] Article 6 section (2) Regulation of the Supreme Court 1/1990.