Overview of the Indonesian Legal System

The Indonesian legal system is complex because it is a confluence of three distinct systems. Prior to the first appearance of Dutch traders and colonists in the late 16th century and early 17th century, indigenous kingdoms prevailed and applied a system of adat (customary) law. Dutch presence and subsequent colonisation during the next 350 years until the end of World War II left a legacy of Dutch colonial law. A number of such colonial legislation continue to apply today. Subsequently, after Indonesian declared independence on 17 August 1945, the Indonesian authorities began creating a national legal system based on Indonesian precepts of law and justice.

These three strands of adat law, Dutch colonial law and national law co-exist in modern Indonesia. For example, commercial law is grounded upon the Commercial Code 1847 (Kitab Undang-Undang Hukum Dagang or Wetboek van Koophandel), a relic of the colonial period. However, commercial law is also supplemented by a large number of new laws enacted since independence. They include the Banking Law 1992 (amended in 1998), Company Law 1995, Capital Market Law 1995, Antimonopoly Law 1999 and the Oil & Natural Gas Law 2001. Adat law is less conspicuous. However, some adat principles such as “consensus through decision making” (musyawarah untuk mufakat) appear in modern Indonesian legislation.

Gas Regulation in Indonesia

The ownership, organizational and regulatory framework for LNG facilities depends on how the LNG business is carried out. If, under the applicable contractual arrangements, the natural gas is to be sold as LNG, then the owner of the LNG will be the government until the point of delivery or sale and the facilities will be developed within the framework of the cooperation contract.

Land & Real Estate in Indonesia

The system of land registration in Indonesia includes measuring, mapping and recording the land dimensions, registering the land title (which includes a public announcement) and, finally, the issuance of the land certificate under the applicant’s name.

Dispute Resolution in Indonesia

In the post-1998 era, corruption has been reduced in the Indonesian court system; so the parties can now rely on disputes being determined on the respective merits.  Consequently, any consideration in the past to declare Indonesia a “non-convenient” forum based on such concerns, would therefore no longer apply.

Typical provisions of a joint venture agreement Indonesia

A joint venture (JV) is a business agreement in which the parties agree to develop, for a finite time, a new entity and new assets by contributing equity. They exercise control over the enterprise and consequently share revenues, expenses and assets. There are other types of companies such as JV limited by guarantee, joint ventures limited by guarantee with partners holding shares.

A Legal Primer on Joint Venture Agreements in Indonesia

When forming an Indonesian joint venture the two main statutes for consideration are typically the Indonesian Civil Code and the Indonesian Company Law.

By contrast with the Civil Code, which was promulgated in the 19th century by the Dutch East Indies government and was based on the then existing Civil Code in the Netherlands, the Indonesia Company Law (Law 40 of 2007) was promulgated in 2007 and is a relatively modern form of companies’ law, drawing on a variety of contemporary international legislative models. Both laws will impact your structure and organization in Indonesia and the substance of your joint venture agreement.

Legal Separation for Divorce in Indonesia

Legal separation can be the basis for getting your divorce in Indonesia. When you’ve been living separately from your spouse for more than four (4) years, even though you never had a fight, it is the symptom of having disagreement in your marriage. Therefore, it can be used to dissolve your marriage. This is applicable for both Indonesians, mixed-marriage couples, and foreigners. In another words, it is applicable to those who submit themselves voluntarily to the Indonesian legal system.