Arbitration offers a solution outside the traditional court path

Oct 13, 2025 by wbrum.org 18 views

Juridical Analysis Request for Rejection of the Singapore International Arbitration Center (SIAC) Decision Number 169 of 2012 between PT Fega Indotama and LVMH Fragrances & Cosmetics Pte. LTD Based on the decision of the Supreme Court Number 705B/Pdt.Sus-Arbt/2015

Introduction

In the current global business world, the arbitration institution is increasingly recognized as an alternative to dispute resolution, both in Indonesia and internationally. Arbitration offers a solution outside the traditional court path, but it does not mean that arbitration is free from challenges. One important issue is that arbitration does not have the power to force the execution of its decision. In practice, the court has the right to reject the recognition and implementation of international arbitration decisions, as happened in the case of PT Fega Indotama against LVMH Fragrances & Cosmetics Pte. LTD at the Singapore International Arbitration Center (SIAC) which resulted in decision number 169 of 2012.

Background of the Study

This study aims to explore the reasons that can be used as a basis for the court to reject the recognition of an international arbitration decision. In addition, research also analyzes the mechanism for requesting the arbitration decision. By using a normative juridical approach, this research relies on literature studies and inventorying various legal sources, including books, journals, articles, and relevant international legal instruments.

Methodology

The research methodology used in this study is a normative juridical approach. This approach is used to analyze the legal framework governing arbitration in Indonesia. The research relies on literature studies and inventorying various legal sources, including books, journals, articles, and relevant international legal instruments.

Results of the Analysis

The results of the analysis show that the Central Jakarta District Court has the authority to reject the recognition and implementation of international arbitration decisions if there are violations of certain conditions. This finding reflects the importance of understanding the legal framework governing arbitration in Indonesia. However, the current legal system is still far from perfect, especially in the regulation aspect regarding the time and procedure for rejection. The unclear rule is not only difficult for the parties involved, but also has the potential to cause greater losses in the future if not immediately repaired.

Reasons for Rejecting International Arbitration Decisions

There are several fundamental reasons that can be a reference for the court to reject international arbitration decisions. First, if there is evidence that the arbitration process is not carried out fairly or without regard to the rights of one party. Second, if the contents of the decision are contrary to the legal provisions in force in Indonesia. Third, if arbitration is considered not to have the authority to prosecute the dispute faced. The clarity of these reasons is very important to guarantee justice and legal certainty for all parties involved in the arbitration process.

Mechanism for Requesting the Rejection of International Arbitration Decisions

In addition, the mechanism for requesting the rejection of international arbitration decisions needs to be emphasized to prevent the potential for further losses. It is recommended that an update is carried out in existing legal regulations, by clarifying the procedure, submission time, and the conditions that must be met in submitting an application. This is expected to increase the trust of business actors in the arbitration system in Indonesia and make arbitration a more interesting choice in resolving business disputes.

Conclusion

By paying attention to the issues and challenges that exist in the implementation of arbitration, it is important for all parties to continue to evaluate and perfect the existing legal framework. This will not only benefit business people, but also strengthen Indonesia's position in the eyes of the world as a country that supports dispute resolution through the arbitration method.

Recommendation

Based on the results of the analysis, it is recommended that the government and the relevant institutions take the following steps:

Update the existing legal regulations regarding arbitration to clarify the procedure, submission time, and the conditions that must be met in submitting an application.
Provide education and training to judges, lawyers, and other stakeholders on the importance of arbitration and the legal framework governing arbitration in Indonesia.
Establish a clear and transparent mechanism for requesting the rejection of international arbitration decisions.
Encourage business actors to use arbitration as a method of dispute resolution in Indonesia.

Future Research Directions

This study provides a foundation for further research on the topic of arbitration in Indonesia. Future research can explore the following topics:

The impact of arbitration on the economy of Indonesia.
The role of arbitration in resolving business disputes in Indonesia.
The challenges and opportunities of arbitration in Indonesia.
The comparison of arbitration in Indonesia with other countries.

Limitations of the Study

This study has several limitations. First, the study only focuses on the legal framework governing arbitration in Indonesia. Second, the study does not explore the impact of arbitration on the economy of Indonesia. Third, the study does not provide a comprehensive analysis of the arbitration process in Indonesia.

Conclusion

In conclusion, this study provides a juridical analysis of the rejection of the Singapore International Arbitration Center (SIAC) decision number 169 of 2012 between PT Fega Indotama and LVMH Fragrances & Cosmetics Pte. LTD based on the decision of the Supreme Court number 705B/Pdt.Sus-Arbt/2015. The study highlights the importance of understanding the legal framework governing arbitration in Indonesia and the need for a clear and transparent mechanism for requesting the rejection of international arbitration decisions.
Frequently Asked Questions (FAQs) about Juridical Analysis Request for Rejection of the Singapore International Arbitration Center (SIAC) Decision Number 169 of 2012 between PT Fega Indotama and LVMH Fragrances & Cosmetics Pte. LTD Based on the decision of the Supreme Court Number 705B/Pdt.Sus-Arbt/2015

Q1: What is the purpose of this study?

A1: The purpose of this study is to explore the reasons that can be used as a basis for the court to reject the recognition of an international arbitration decision. In addition, research also analyzes the mechanism for requesting the arbitration decision.

Q2: What is the significance of the Singapore International Arbitration Center (SIAC) decision number 169 of 2012 between PT Fega Indotama and LVMH Fragrances & Cosmetics Pte. LTD?

A2: The SIAC decision number 169 of 2012 between PT Fega Indotama and LVMH Fragrances & Cosmetics Pte. LTD is significant because it highlights the importance of understanding the legal framework governing arbitration in Indonesia. The decision also shows that the court has the authority to reject the recognition and implementation of international arbitration decisions if there are violations of certain conditions.

Q3: What are the reasons for rejecting international arbitration decisions?

A3: There are several fundamental reasons that can be a reference for the court to reject international arbitration decisions. First, if there is evidence that the arbitration process is not carried out fairly or without regard to the rights of one party. Second, if the contents of the decision are contrary to the legal provisions in force in Indonesia. Third, if arbitration is considered not to have the authority to prosecute the dispute faced.

Q4: What is the mechanism for requesting the rejection of international arbitration decisions?

A4: The mechanism for requesting the rejection of international arbitration decisions needs to be emphasized to prevent the potential for further losses. It is recommended that an update is carried out in existing legal regulations, by clarifying the procedure, submission time, and the conditions that must be met in submitting an application.

Q5: What are the benefits of arbitration in Indonesia?

A5: Arbitration offers several benefits in Indonesia, including:

Providing a solution outside the traditional court path
Increasing the trust of business actors in the arbitration system in Indonesia
Making arbitration a more interesting choice in resolving business disputes
Strengthening Indonesia's position in the eyes of the world as a country that supports dispute resolution through the arbitration method

Q6: What are the challenges of arbitration in Indonesia?

A6: The challenges of arbitration in Indonesia include:

The unclear rule regarding the time and procedure for rejection
The potential for further losses if not immediately repaired
The need for education and training to judges, lawyers, and other stakeholders on the importance of arbitration and the legal framework governing arbitration in Indonesia

Q7: What is the role of the government in promoting arbitration in Indonesia?

A7: The government plays a crucial role in promoting arbitration in Indonesia by:

Updating existing legal regulations regarding arbitration
Providing education and training to judges, lawyers, and other stakeholders on the importance of arbitration and the legal framework governing arbitration in Indonesia
Establishing a clear and transparent mechanism for requesting the rejection of international arbitration decisions

Q8: What is the future of arbitration in Indonesia?

A8: The future of arbitration in Indonesia is promising, with the potential for increased use of arbitration as a method of dispute resolution in Indonesia. However, it is essential to continue to evaluate and perfect the existing legal framework to ensure that arbitration is used effectively and efficiently in Indonesia.

Q9: What are the implications of this study for business actors in Indonesia?

A9: This study has implications for business actors in Indonesia, including:

The need to understand the legal framework governing arbitration in Indonesia
The importance of using arbitration as a method of dispute resolution in Indonesia
The need to be aware of the potential challenges and opportunities of arbitration in Indonesia

Q10: What are the implications of this study for the government of Indonesia?

A10: This study has implications for the government of Indonesia, including:

The need to update existing legal regulations regarding arbitration
The importance of providing education and training to judges, lawyers, and other stakeholders on the importance of arbitration and the legal framework governing arbitration in Indonesia
The need to establish a clear and transparent mechanism for requesting the rejection of international arbitration decisions