Indonesia’s legal system is primarily rooted in the civil law tradition, with significant influence from Dutch colonial law. It features an extensive and codified set of statutes, which serve as the primary source of legal authority, in line with principles common to civil law jurisdictions. The judicial process follows an inquisitorial model.

Legal proceedings in Indonesia are mostly document-based. Cases typically require comprehensive written documentation, including the statement of claim, statement of defence, documentary evidence, and written conclusions.

Indonesia’s court system operates under a hierarchical structure, organised to address various areas of law through courts with specialised jurisdictions. The judiciary functions as a unified national system, reflecting Indonesia’s unitary state framework without any division between federal and provincial courts.

The core structure of Indonesia’s judiciary encompasses the following.

General Courts (Pengadilan Umum)

These include district courts (pengadilan negeri) at the first level, handling civil and criminal disputes. Decisions from the district courts are subject to appeal before the high courts (pengadilan tinggi) and, ultimately, can be brought before the Supreme Court (Mahkamah Agung) for final decisions.

Religious Courts (Pengadilan Agama)

These courts have exclusive authority over personal law matters, including marriage, inheritance, and family disputes among Muslim citizens.

Administrative Courts (Pengadilan Tata Usaha Negara)

These courts adjudicate disputes between private entities and government authorities concerning administrative decisions. Cases may involve issues such as the legality of government permits or public service delivery.

Military Courts (Pengadilan Militer)

These courts handle offences committed by members of the Indonesian armed forces, with a distinct appellate structure within the military justice system. This system operates separately from the civilian judiciary, reflecting the principle of military discipline and governance.

Specialised Courts

Within the general courts, there are specialised divisions, such as the commercial court (pengadilan niaga), which has jurisdiction over bankruptcy, insolvency, and intellectual property disputes, as well as the corruption court (pengadilan tindak pidana korupsi) which focuses exclusively on corruption cases.

Constitutional Court (Mahkamah Konsititusi)

The Constitutional Court of Indonesia (Mahkamah Konstitusi or MK) is a specialised court that primarily deals with constitutional matters. Its jurisdiction covers various matters including judicial review of legislation, disputes between state institutions, disputed election results, and dissolution of political parties. The Constitutional Court’s decisions are final and binding, meaning there is no appeal or higher review mechanism.

Commencement of a case to the first hearing typically takes several weeks, depending on the complexity of the case and the Court’s docket. Disputes involving foreign parties will take significantly longer due to lengthy service processes, which may take one to two years.

In Indonesia, court filings and proceedings are generally open to the public as part of the principle of transparency in the judicial system. This can be seen online through the case tracking information system (sistem informasi penelusuran perkara), which allows the public to access information about the status of cases being handled by the respective courts.

Furthermore, court decisions that have obtained legal force are generally accessible to the public through the decision directory (direktori putusan) managed by the Supreme Court of Indonesia.

Similarly, court hearings are typically conducted in open court, and members of the public and media are allowed to attend. However, there are specific exceptions where court proceedings and documents may be restricted from public access to protect privacy or sensitive information.

For example, cases involving minors, family disputes (eg, divorce and child custody), or matters that could threaten public morality or national security may be heard in closed sessions. In these instances, only the parties involved and their legal representatives are permitted to be present.

Legal representatives must meet specific requirements to appear and conduct cases in court. These requirements are intended to ensure that only qualified and competent professionals represent clients in judicial proceedings.

Lawyers must hold a law degree from a recognised university and complete a professional advocate training program. They must also pass the bar examination administered by the Indonesian Bar Association and be sworn in by the high court. Only those officially registered with the Indonesian Bar Association are authorised to practice law and represent clients in court. Duly licensed lawyers have the right of audience in all courts across the country and may represent clients in both civil and criminal cases.

Foreign legal consultants or advisors are permitted to practice in Indonesia, particularly in international or cross-border matters, but they cannot conduct court cases or engage in any direct advocacy. Foreign lawyers are also required to work in co-operation with local law firms and are subject to regulations imposed by the Ministry of Law and the Indonesian Bar Association.

The general notion in Indonesian litigation is that each party bears its own legal fees. It is therefore extremely rare for a party to recover legal fees from the other party in court litigation, and, in addition, collection through the court enforcement process is cumbersome. For these reasons, third-party litigation funding is not particularly prominent at the present time.

Nevertheless, there is no regulation on third-party litigation financing, as it is neither expressly allowed nor forbidden by current legislation. In the absence of a regulatory framework governing third-party funding in litigation, the prevailing norms of Indonesian contract law apply, providing for contractual freedom and party autonomy. Given the lack of specific regulations, parties should exercise caution to ensure that their funding arrangements do not violate public policy or any mandatory provisions under Indonesian law.

There are currently no regulations on the types of lawsuits that are available for third-party funding. Any third-party funding in Indonesia is not ordinarily disclosed publicly. There is also no publicly available jurisprudence from Indonesian courts that specifically addresses the use or implications of third-party funding. Data is unfortunately scarce in this area.

There are currently no regulatory provisions specifying whether or not third-party funding is available to plaintiffs and defendants.

There are currently no regulatory provisions on minimum or maximum amounts a third-party funder will fund.

There are currently no regulatory provisions on the costs a third-party funder will consider funding.

The law does not prohibit any specific type of fee arrangement. It is therefore possible for lawyers to act on a contingency fee basis.

There are currently no time limits by when a party to the litigation should obtain third-party funding.

There are no rules mandating specific pre-action conduct that parties must adhere to before initiating court proceedings. However, there are customary practices and procedural considerations that may influence the approach taken before filing a lawsuit.

These customary practices and procedural considerations serve as evidence of a good faith attempt to resolve the matter without litigation and may be favourably considered by the court and include the following.

• Demand letter(s): it is common practice to issue a demand or warning letter as a formal notice to the other party, detailing the claims and demands.
• Pre-action mediation or negotiation: parties are generally expected to engage in good faith negotiations to resolve the dispute before resorting to litigation. This involves genuine attempts to discuss and amicably settle the issues, especially if contractual provisions so require.

Since there is no statutory obligation to undertake pre-action conduct, there are no penalties for failing to do so.

The limitation period for bringing a civil suit is typically 30 years under Article 1967 of the Indonesian Civil Code. This duration applies unless a specific statute prescribes a shorter period for particular types of claims.

A limitation period generally commences from the moment a legal right is infringed or a contractual obligation becomes due. In the context of tortious liability, the limitation period begins when the aggrieved party becomes aware, or reasonably ought to have become aware, of the injury and the identity of the liable party.

The determination of jurisdiction in which a claim is filed against the defendant depends on the nature of the claim, the location of the parties, and the subject matter of the dispute. Several considerations are taken into account when identifying the appropriate venue for filing such a lawsuit, including the following.

• Domicile or place of business: jurisdiction is generally determined based on the defendant’s domicile or registered place of business. A lawsuit must be filed in the district court where the defendant resides or where the entity is headquartered.
• Location of the disputed object: if the lawsuit concerns immovable property, the competent court is the one in the jurisdiction where the property is located.
• Choice of forum: parties may also agree on a specific forum for dispute resolution, provided that it does not contravene public policy. Such agreements are typically respected by the courts unless there are overriding statutory requirements.
• Nature of the claim: certain issues will need to be heard by certain specialised courts. For example, if the claim involves a civil matter such as an unlawful act (tort) or contractual dispute, the lawsuit must be filed with the relevant district court. Conversely, if the matter pertains to intellectual property disputes, the claim must be submitted to the commercial court, which has exclusive jurisdiction over such cases.

In Indonesian civil litigation, the initial document filed to initiate a lawsuit is the statement of claim (gugatan). This document is submitted to the competent district court and outlines:

• the plaintiff’s legal claims;
• the basis for jurisdiction;
• the facts of the case;
• the legal arguments; and
• the specific relief sought.

The plaintiff must clearly articulate the cause of action and substantiate their claims with relevant facts and laws.

A party is permitted to amend its statement of claim after it has been filed, provided that the other party has not filed its statement of defence. Any amendment after the statement of defence is filed must be approved by the other party and the court.

Service of process (panggilan and pemberitahuan) is a crucial step to informing the defendant that they have been sued and ensuring the defendant’s right to a fair trial is upheld.

Service of the lawsuit is the responsibility of the court, not the plaintiff. The court’s bailiff serves the summons and other necessary court documents to the defendant. The plaintiff does not directly handle the service process but must ensure that the court has adequate information for the service to be carried out efficiently.

The court bailiff physically delivers a copy of the summons and the statement of claim to the defendant at their domicile or last known residence. If the defendant cannot be located, the bailiff may leave the documents with the local village head or subdistrict head. If the defendant’s address is unknown, the summons is delivered to the regent of the area where the defendant was last known to reside. In these cases, the summons is also posted on the announcement board of the district court.

If the defendant resides within Indonesia but outside the jurisdiction of the court where the lawsuit was filed, the court may co-ordinate with the local district court where the defendant resides to serve the documents.

For defendants located outside Indonesia, service can be executed through diplomatic channels. The plaintiff must notify the court of the defendant’s international address, and the court will liaise with the Ministry of Foreign Affairs and Indonesian embassies or consulates abroad to serve the documents on the defendant.

If the defendant does not respond to a lawsuit, the case may proceed in their absence. The court will check if the summons was properly served and if the defendant had a reasonable opportunity to appear. If the court finds the service to be valid, the proceedings may move forward without the defendant.

In these cases, the court may issue a default judgment in favour of the plaintiff, provided the claim is supported both legally and factually. The court will review the evidence to confirm the plaintiff’s entitlement to the judgment before making its decision. Once issued, the default judgment is formally served to the defendant, notifying them of the court’s ruling.

The defendant has the right to file an objection (verzet) to the default judgment within 14 days of receiving notice. By submitting a verzet, the defendant can reopen the case and present their defence, resulting in a full examination of the merits.

Class action claims are permitted in Indonesia. A class action is defined as a legal procedure in which one or more individuals represent a group in a lawsuit, either on their own behalf or on behalf of others with similar legal or factual issues.

To qualify for a class action, there must be common legal or factual issues among the claims of the class members, which should predominate over individual issues. The class must be large enough to make individual lawsuits impractical, emphasising practicality and efficiency. The claims or defences of the representative parties must be typical of those of the class, and their interests should align with those of the class members. Additionally, the representative parties must adequately protect the interests of the class, ensuring competency and avoiding conflicts of interest.

If the court determines that a class action may proceed, notice must be given to all potential class members, detailing the lawsuit, the class, and the right to opt out. Those who opt out retain the right to pursue individual lawsuits.

If the case is not settled, it proceeds to trial, and the court’s judgment binds all class members, except those who opted out. Any proposed settlement must be approved by the court to ensure it is fair, reasonable, and adequate for the class members. The considerations of the judges for class-action lawsuits are no different from those for lawsuits filed by individuals or legal entities.

There is no specific statutory obligation under civil procedure law that mandates lawyers to provide clients with a cost estimate of potential litigation at the outset. However, ethical standards and guidelines set by the Indonesian Bar Association require advocates to act transparently and in the best interest of their clients. This includes discussing and clarifying the expected legal fees and costs involved in a case.

Interim applications or motions are permissible in civil proceedings in Indonesia. Interim motions are generally filed at an early stage to address urgent matters or issues that could impact the case’s progress or the parties’ rights before the final judgment. It can also be made during the proceedings if new circumstances arise that require the court’s intervention.

Parties may apply for interim measures such as to prevent an act that could harm the applicant’s interests, to secure assets to satisfy a potential judgment, or for specific relief pending the outcome of the case.

In practice, the success rate for interim applications is low.

A party may request a decision on preliminary legal issues that could expedite the resolution of the case. For example, a defendant may file an objection/exception (eksepsi) challenging the court’s jurisdiction to adjudicate the dispute. If the court upholds the objection, it may issue a ruling on the matter without proceeding to a substantive hearing. A ruling on an objection regarding the court’s competence is deemed a final decision.

In addition to the jurisdictional exception, a defendant may also seek to have the plaintiff’s case dismissed without the panel of judges examining the merits. This can be done by filing exceptions on the basis that the lawsuit has been filed against the wrong party or because of non-compliance with procedural rules. However, unlike jurisdictional exceptions, rulings on these procedural objections are typically issued at the conclusion of the trial, similar to cases where the substantive issues have been fully examined.

Any procedural objection may be submitted by the defendant once the trial has commenced. No objections may be filed before the proceedings are officially underway.

However, procedural objections must be raised by the defendant before the court examines the substantive issues or merits of the case. Common grounds raised by defendants include lack of jurisdiction; lack of legal standing; and formal defects in the lawsuit.

An interested party who is not registered as a party to the lawsuit may join the proceedings if they have a legal or factual interest in the case’s outcome. This typically occurs when a judgment would impact their rights or obligations. Under Indonesian civil procedural law, this is known as intervention. Generally, there are three types of intervention. These are as follows.

• Voeging: a third party voluntarily joins the civil dispute proceedings to support either the plaintiff or the defendant.
• Tussenkomst: a third party voluntarily joins the civil dispute proceedings without siding with either the plaintiff or the defendant, acting instead to protect their own independent interests.
• Vrijwaring: a third party is brought into the civil dispute proceedings by one of the existing parties to share or assume liability.

The interested party must file a motion to join the proceedings. This motion must clearly state the reasons for their interest in the case and explain how the outcome may affect them, which can be supported by any relevant evidence. The motion should generally be filed at an early stage of the proceedings, ideally before the mandatory mediation between the parties or the substantive examination of the case, to ensure that the joinder does not cause undue delay.

Requests for security for costs are uncommon in Indonesia, as they are not explicitly provided for under Indonesian civil procedural law.

There are no special fees for filing an interim application or motion in Indonesia. All court fees must be paid in full and in advance by the plaintiff when filing the lawsuit with the court. These advances cover various expenses related to processing the case, such as administrative costs, summons, notifications, and other procedural activities. The total amount of the advance fee depends on the nature and complexity of the case, as well as the specific court handling it. Each court may have its own fee schedule, which can be accessed through official court websites or by contacting the court directly.

If the actual costs incurred during the proceedings are less than the advance payment, the remaining balance is typically refunded to the paying party. Courts are responsible for notifying the parties about any remaining balance. Conversely, if the actual costs exceed the initial advance, the court may require additional payments to cover the shortfall, which are generally borne by the plaintiff as the initiating party. However, it is common for the parties to request that these fees be reimbursed or assigned to the losing party, subject to the court’s final decision on the allocation of costs.

Following the hearing at which the plaintiff’s lawsuit is read, the defendant will have one to two weeks to respond. This response may include raising objections or exceptions, which are typically submitted with the statement of defence to the plaintiff’s claims.

If the objection pertains to the jurisdictional authority of the court to hear and adjudicate the case, the panel of judges may address the absolute competence objection before it examines the substantive dispute. Typically, an objection on the court’s jurisdiction is decided by the court after a number of hearings, including the filing of various submissions, which can take between six and 24 weeks after the objection is filed.

In Indonesian civil procedure, the concept of discovery is not formally recognised.

There is no process by which a third party can be compelled to produce evidence in civil proceedings.

There is no general discovery process in Indonesia. Parties must disclose and submit all relevant documents that support their claims or defences at the evidence hearing during proceedings. There is no obligation to disclose documents that may be unfavourable to a party’s case unless ordered by the court.

Evidence in Indonesian civil cases is developed through the submission and examination of evidential documents and witness testimonies.

Documents are formally admitted into the record during court hearings. The party introducing a document must explain its relevance and authenticity, which typically must be directly related to the issues being litigated. The opposing party is given an opportunity to challenge the document’s validity or relevance.

Witnesses are called to testify in court, where their statements are taken under oath. The court examines each witness, and both parties are allowed to pose questions to the witnesses.

Parties may also present expert witnesses to provide specialised knowledge or opinions relevant to the case. The court evaluates the credibility and relevance of expert testimony before admitting it into the record.

The court has significant discretion in determining whether evidence is admissible. The judges evaluate the relevance, necessity, and reliability of the evidence presented and may exclude evidence deemed inadmissible.

Indonesia recognises the concept of legal privilege, particularly in the context of attorney-client communications. Indonesian advocates (lawyers) are bound by a duty of confidentiality, as stipulated in Law No 18 of 2003 on Advocates (the “Advocate Law”) and the Indonesian Bar Association Code of Ethics. This duty requires lawyers to keep all information shared by their clients confidential, and they cannot disclose such information without the client’s express consent. The confidentiality obligation covers all communications and documents exchanged between a lawyer and their client, provided the communications are made in the context of seeking or providing legal services.

With regard to external and in-house counsel, if these individuals are also advocates that are sworn in by the high court, then the confidentiality obligation above the Advocate Law and Code of Ethics will also be applied to them. Additionally, an external and in-house counsel are usually bound to their contract or company’s regulation, which would usually also include a confidentiality obligation.

Parties have the discretion to present or choose not to present any written evidence that may support their claim or defence.

Injunctive relief is available but is not commonly issued by the courts. Indonesian courts do not have a strong tradition of granting injunctive relief, especially in civil and commercial cases, where remedies tend to be compensatory rather than preventative.

In Indonesian law, injunctive relief is a form of court order designed to prevent harm or preserve the status quo before a full hearing on the merits of a case. The courts have discretionary authority to issue injunctions based on the urgency and necessity of the situation.

It must be noted that filing injunctive measures must be made in the lawsuit setting out the claims. It is not an ex parte process. In any event, injunctions are rarely granted in practice.

One of the most common injunctive measures in Indonesia is provisional attachment (sita jaminan or conservatoir beslag). This measure is used to secure assets belonging to the defendant in order to prevent their dissipation during litigation. The purpose of provisional attachment is to ensure that the assets remain available for enforcement if the plaintiff prevails in the case. Assets that can be attached under this measure include real property, bank accounts, and movable property such as vehicles or equipment.

Another applicable injunctive measure is sequestration of disputed property (sita revindicatoir). This specific form of attachment is used when the ownership of the property itself is in dispute. Sita revindicatoir is intended to preserve the property in question until the court resolves the issue of ownership.

The issuance of these injunctive measures is subject to the following general requirements.

• Urgency: the party requesting the interim measure must demonstrate a clear and present risk that the defendant may dissipate or hide assets, or that the subject matter of the dispute could be altered before a judgment is rendered.
• Prima facie case: the plaintiff must present a prima facie case, demonstrating a reasonable likelihood of success on the merits of the case.

In principle, injunctive measures can be requested at any point before the panel of judges issues a ruling or prior to the execution of the judgment. However, these requests must generally be submitted and heard during the court’s official working hours. Indonesian courts do not provide for out-of-hours judges or emergency hearings outside of normal operating times.

Injunctive relief cannot be obtained on an ex parte basis.

An applicant who obtains an injunction can be held liable for damages suffered by the respondent if the injunction is later discharged, especially if it is determined that the injunction was wrongfully granted or caused undue harm. The liability of the applicant is based on the principle that the respondent should be compensated for any losses incurred as a result of the injunction if it was unjustified.

Injunctive relief is typically limited to assets within Indonesia. The Indonesian courts generally do not have the authority to issue injunctions that directly affect the worldwide assets of a respondent.

Injunctive relief cannot be obtained against third parties unless the third party is a party in the litigation proceeding.

Failure to comply with a court decision is a reportable offence that carries criminal sanctions (Article 280(1)(a) of the Penal Code).

The initiation of the litigation process occurs when the plaintiff files a lawsuit in the appropriate jurisdiction. The complaint must thoroughly detail the case facts, the legal basis for the claim, and the specific relief sought.

Upon receipt of the lawsuit, the court issues a summons to the defendant, notifying them of the litigation and the date set for the preliminary hearing. It is critical that the summons is served correctly to ensure that the defendant is fully informed of the legal action.

At the initial hearing if all parties are present, they are required by the presiding judges to participate in court-ordered mediation in an attempt to resolve the dispute amicably. The proceedings are then adjourned for a period of 30 days to facilitate this mediation, which is provided at no cost if conducted by a court-appointed mediator in a designated courtroom. These mediation sessions are generally confidential, unless otherwise agreed by the parties.

If the mediation results in a settlement, the parties will formalise the agreement in a settlement document, which can be ratified by the judges’ panel. This ratified agreement holds the same legal authority as a court judgment.

If mediation fails to produce a resolution and no extension is requested for an additional 30 days, the litigation will proceed with the presentation of the plaintiff’s claims. Should any or all parties be absent from two consecutive mediation sessions, the mediator must declare the mediation unsuccessful, leading the judges to continue with the trial.

In civil disputes, hearings typically follow a structured sequence with a one- to two-week interval between each stage as follows.

• Plaintiff’s claims: the plaintiff reads their statement of claims.
• Defendant’s defence: the defendant responds with a statement of defence against the plaintiff’s claims and may also file a counterclaim.
• Rejoinders and responses: the plaintiff submits a rejoinder to the defendant’s defence and responds to any counterclaims, followed by the defendant’s response to the rejoinder.
• Interlocutory judgment (if any): should the defendant challenge the jurisdiction of the court, and if the court accepts this challenge, an interlocutory judgment will be rendered, dismissing the plaintiff’s claims pending further review. However, the plaintiff will retain the right to appeal this decision to the higher courts. Conversely, if the court rejects the jurisdictional challenge, it will issue an interlocutory judgment affirming its authority and proceed to the evidential phase of the trial.
• Submission of evidence: both parties, beginning with the plaintiff followed by the defendant, submit their documentary evidence for court verification.
• Witness examination: the court reviews testimony from witnesses presented by the parties, including factual witnesses and experts, who must deliver their testimony orally under oath. However, presenting witnesses is not mandatory, and parties may decide whether or not to introduce witness testimony.
• Conclusion: both parties may submit a written conclusion summarising their cases.
• Final judgment: the judge sets a date to render the final judgment.

Oral arguments are uncommon in the trial, as parties primarily present their arguments in written form.

Following a district court’s final judgment, any disagreeing party may appeal to a higher court within a standard period of 14 days from the date of the judgment. The appellate court reviews and may affirm, reverse, or amend the lower court’s decision.

Once the judgment is final and enforceable, the prevailing party may initiate enforcement actions, such as asset seizure or wage garnishment, to ensure compliance with the court’s ruling.

In Indonesia, legal proceedings are predominantly conducted through written submissions. Shorter hearings relating to interim motions or applications, such as provisional measures or interlocutory injunctions, are typically integrated into the main proceedings rather than held separately. During these hearings, parties may present oral arguments, but the emphasis remains on the written documentation submitted to the court.

Regarding case management hearings, Indonesia does not have a formal system akin to pre-trial or case management hearings found in some other jurisdictions. However, the panel of judges holds the authority to manage and direct the proceedings to ensure efficiency and adherence to procedural rules.

In more complex cases, the court may take a proactive role by setting timeframes and managing evidence presentation. These are typically managed during scheduled hearings within the existing trial framework rather than through separate case management hearings.

Jury trials are not available in civil cases in Indonesia.

In civil procedural law, evidence is classified into written evidence; witness testimony; presumptive evidence; confessional evidence; and oath evidence.

The governing principle in civil litigation is that the burden of proof rests with the parties. It is incumbent upon the party asserting a claim to substantiate it with evidence. During the trial, the primary role of the judge is to ascertain and determine formal truth, which is derived from the facts presented by the parties during the trial.

The evidential phase commences following the submission of written arguments. In civil cases, documentary evidence often suffices to substantiate the facts of the case. These documents, once tendered as evidence, must be displayed at trial in their original form, granting the opposing party the right to examine but not to retain copies.

The documents presented as evidence are copies stamped with a stamp fee being payable. This is currently IDR10,000 (approximately USD0.70). The original documents must also be shown to the judges for verification.

Any documents not in Indonesian require translation by a sworn translator prior to submission to the court. Access to evidence is restricted to the panel of judges and is not available to the public.

Under Article 1866 of the Indonesian Civil Code and Article 164 of the HIR, witness testimony is recognised as evidence in civil disputes and must be delivered orally and in person at the hearing. Witnesses must present their testimony directly, without representation and not in written form.

Foreign witnesses may testify in Indonesian courts provided an official interpreter is supplied by the party introducing the witness to ensure accurate translation of their statements for the court.

Expert testimony is permissible in court proceedings. Similar to witnesses, experts designated by the parties must deliver their evidence orally. When appearing in court, experts will testify under oath, adhering to their respective religious beliefs. During the proceedings, each party, as well as the panel of judges, is given the opportunity to question the experts.

The involvement of experts in a trial can be initiated either by the parties themselves or by the judge. It is rare for judges to seek expert testimony without a request from either party.

In Indonesian judiciary proceedings, hearings are typically held in public to uphold the principles of transparency and openness. However, there are exceptions for cases requiring confidentiality, such as those involving minors, national security concerns, or sensitive personal information. Hearings are not typically transcribed by the court.

In civil proceedings, judges adopt a passive role and focus solely on resolving disputes and providing remedies specifically requested by the parties involved. Civil judges determine cases based on the preponderance of evidence and are not authorised to solicit additional evidence beyond what the parties present. However, they are permitted to scrutinise the relevance and materiality of each piece of evidence to adequately assess the claims and reach a legal judgment.

In civil proceedings, the role of a judge is to discern and establish the formal truth, which is derived from the facts presented by the parties during the trial. The concept of a judge’s passivity does not imply mere acceptance and review of the information provided by the parties. Rather, judges actively engage in evaluating the veracity of the facts presented in the courtroom.

Judges are prohibited from making decisions in the absence of evidence. Both the rejection and acceptance of a lawsuit must be substantiated by evidence originating from the facts provided by the parties. Evidence must be firmly supported by factual data. Without this support, it cannot be deemed conclusive.

The duration required for a district court to conclude its examination of a case can vary widely, influenced by factors including the case’s complexity, the number of involved parties, and potential delaying tactics by counterparties, particularly foreign ones.

Although courts generally schedule disputes promptly, procedural delays are inevitable. To mitigate such delays, the Supreme Court issued Circular Letter No 2 of 2014 regarding Completion of Cases in the Court of First Instance and Court of Appeal at Four Judicial Institutions. The Circular Letter directs district courts to conclude cases within five months and mandates the high courts to resolve appeals within three months. District court judges can request extensions to these deadlines, which must be approved by the chief of the relevant district court. It is common for cases, especially those involving technical and expert evidence or foreign parties, to extend beyond the stipulated timeframe and often last a year or more.

For cases involving foreign defendants or co-defendants, serving summons alone may take at least four months before the court may proceed in their absence. Some panels of judges opt to issue up to three summonses before continuing with hearings.

At the appellate levels, the timeframe for the high court and the Supreme Court to review appeals and cassations, respectively, also varies based on the existing case backlog. Typically, it may take at least six months for the high court to render a decision, with the Supreme Court potentially taking an additional 12 months.

Simple claims for disputes of less than IDR500 million are heard in an expedited procedure that must be concluded within 25 days of the date of the first hearing.

An amicable settlement in a lawsuit can often be reached without the need for formal court approval. However, if the parties wish for the settlement to have the same enforceability as a court judgment, they may seek the court’s ratification. The court’s ratification will be documented in a court decision which may be publicly accessible, except for certain conditions.

The settlement of a lawsuit can remain confidential if the settlement is reached during the court-mandated mediation process. This process is private and closed to the public unless all parties involved agree to open it.

Any statements or admissions made during mediation are deemed inadmissible as evidence in any subsequent court proceedings concerning the same dispute if no settlement is achieved. Additionally, all records maintained by the mediator during the mediation process must be destroyed at its conclusion. Furthermore, mediators are not permitted to testify as witnesses in any related court proceedings.

In Indonesia, the enforceability of a settlement agreement depends on whether it has been ratified by the court. When parties reach an agreement during court-mandated mediation, the panel of judges can ratify the settlement agreement, making it equivalent to a final and binding court judgment. This court-ratified settlement is enforceable through legal mechanisms available for court judgments, allowing the prevailing party to take enforcement actions, such as asset seizure or garnishment, if the other party does not comply.

Settlement agreements reached outside of court, without formal ratification, are treated as private contracts. While they are binding on the parties involved, enforcement depends on the willingness of both parties to uphold the terms. If one party fails to comply, the other party may need to file a new lawsuit for breach of contract to enforce the agreement through the court.

A settlement agreement may be set aside under specific circumstances. Typically, the main scenarios in which a settlement agreement can be set aside, include fraud; misrepresentation; duress; or violations of Indonesian law or public policy.

In Indonesia, a successful litigant can receive various forms of awards, depending on the nature of the case, the claims made, and the evidence provided. At the full trial stage, remedies focus on compensatory and declaratory relief, as Indonesian law typically emphasises restitution over punitive measures. The main forms of awards and remedies available to a successful litigant include the following.

• Monetary damages in the form of material and immaterial damages: material damages refer to tangible financial losses in the form of expenses, losses, and interest, while immaterial damages address losses related to future opportunities, emotional distress, or reputational harm, although they are less frequently awarded. For cases involving overdue payments or financial losses, courts may award interest as per Article 1250 of the Indonesian Civil Code. This typically applies a rate of 6% per annum from the date it is requested from the court until full payment is made.
• Declaratory relief:
1. declaration of rights: a court may issue a declaratory judgment that clarifies the rights and obligations of the parties. This type of relief is commonly used in contractual disputes, property disputes, and cases where legal status or ownership must be determined; or
2. recognition of title or ownership: in property and land disputes, the court may declare the rightful owner, thereby resolving conflicting ownership claims. Declaratory relief can also apply to intellectual property, affirming the rights of the rightful holder.
• Specific performance: in cases involving contractual obligations, the court may order the breaching party to fulfil their contractual duties. While specific performance is less common in Indonesian courts due to enforcement challenges, it may be awarded if the contractual obligation is clear and feasible to execute. This remedy is more likely in cases involving unique items or specific actions that cannot be adequately compensated through monetary damages.
• Restitution and reinstatement: in cases involving unjust enrichment or wrongful possession, the court may order restitution, requiring the defendant to return property or assets wrongfully obtained. Reinstatement may also be ordered, especially in employment or contractual contexts, where it may involve returning the litigant to their previous position or condition before the harm occurred.

Indonesian courts generally focus on fair and equitable compensation for losses suffered, with a preference for remedies that restore the successful litigant’s position rather than impose punitive measures.

Under Indonesian law, there are two primary grounds for filing a claim:

• claims based on default or breach of an agreement; and
• claims based on unlawful acts or torts.

Unlike common law jurisdictions, punitive damages are not recognised, as damages awarded are purely compensatory for the material or immaterial damages.

Regarding breaches of contract, Article 1246 of the Indonesian Civil Code specifies that a party may seek compensation for:

• costs that have already been incurred by the affected party (expenses);
• damage or loss of property caused by the negligence of the other party (losses); and
• profits that were anticipated but not realised due to the breach (interest).

If not regulated under the contract, Article 1250 of the Indonesian Civil Code provides the percentage of interest on monetary judgments at 6% per annum, calculated from the date of it first requested before the court.

Liquidated damages are enforceable under Article 1249 of the Indonesian Civil Code. For these types of damages, the non-defaulting party must not receive damages that are higher or lower than the amount agreed in the contract.

Damages that may be awarded are those that were foreseeable at the time the agreement was concluded and are a direct result of the breach, under Articles 1247 and 1248 of the Indonesian Civil Code.

For unlawful acts, the panel of judges is required to ascertain the existence of a causal connection between the defendant’s actions and the harm or damages claimed by the plaintiff. Additionally, Article 1371(2) of the Indonesian Civil Code suggests that compensation for unlawful acts should be assessed based on the position and capacity of both parties involved, as well as the factual circumstances of the case.

Article 1250 of the Indonesian Civil Code mandates the accrual of post-judgment interest at a rate of 6% per annum, calculated from the date it is requested in court until the obligation is fulfilled. While the Article specifies that default interest must only be paid from the time it is formally requested in court, jurisprudence in Indonesia offers a noteworthy exception. Specifically, Supreme Court Decision No 367 K/Sip/1972, states that compensation for losses and interest may commence from the date the loss occurred.

Once a domestic judgment becomes final and binding, if the losing party does not voluntarily comply, the successful party may submit an enforcement application to the district court in the jurisdiction of the losing party’s residence.

In practice, the district court will issue an execution warning (aanmaning), directing the losing party to satisfy the judgment within eight days. If compliance is not met within this timeframe, the court may order the attachment of the losing party’s assets as specified in the enforcement application. These assets are then seized and sold at a public auction.

In Indonesia, foreign judgments are not directly enforceable due to the absence of international conventions to which Indonesia is a party. Consequently, a party seeking to enforce a foreign judgment must initiate a new claim in the district court. During this process, the foreign judgment can be presented as evidence. However, Indonesian courts are not bound by foreign judgments and may independently assess its merits.

The general civil claim procedure in Indonesia progresses through three stages: initial fact examination at the district court; appellate review at the high court; and cassation at the Supreme Court.

Thereafter, parties may seek extraordinary remedies, such as a judicial review by the Supreme Court based on limited grounds.

Appeals must be lodged within 14 days following the reading or notification of the district court’s decision. Failure to appeal within this timeframe renders the decision final and binding. Appeals to the high courts typically take six months or more.

Subsequent cassation to the Supreme Court must be filed within 14 days of the high court’s ruling being notified to the party. The duration of Supreme Court appeals can vary, generally extending to at least 12 months.

Furthermore, a final and binding judgment may be contested through a judicial review at the Supreme Court under specific conditions. These conditions include judgments tainted by fraud or forgery; discovery of significant new evidence; judicial overreach; inadequate legal rationale; contradictions with prior judgments on the same issue; or evident legal or factual errors.

Parties in civil cases have the right to appeal a district court judgment to the relevant high court if they are dissatisfied with the decision, which includes decisions on both substantive and procedural matters. Both the plaintiff and the defendant have the right to appeal a judgment.

An appeal may be based on arguments such as:

• errors in the application or interpretation of the law by the lower court;
• new evidence that could significantly affect the outcome of the case and was not available or discoverable at the time of the original trial; and
• procedural errors or violations of judicial processes that could have affected the fairness of the trial.

A notice of appeal must be filed within 14 days of the judgment being issued. This notice is filed with the court that issued the initial judgment, which will then forward the case to the appropriate high court for review.

Upon receiving the appeal, the high court will review the records and arguments from the district court trial. The high court does not typically re-examine witnesses or review new evidence unless exceptional circumstances apply. Instead, it evaluates whether the lower court’s judgment was legally and procedurally sound.

In Indonesian legal proceedings, appellate courts primarily review the decision of the lower court rather than conduct a full rehearing of the case.

The appeal court typically reviews issues raised by the appellant that pertain to potential errors in law; the interpretation of facts; or procedural mistakes made in the lower court’s judgment. The primary aim is to assess whether the first instance court properly applied the law and adhered to procedural fairness.

The appeal process assesses the eligibility of the appeal on both procedural and substantive grounds. Procedurally, the appellant is required to file the appeal within a specified period, typically 14 days from the date of judgment or its notification. If the party submits the appeal after this deadline, this may result in dismissal of the appeal.

Substantively, the appeal must be founded on legitimate grounds, such as errors in law; misinterpretation of facts; or procedural irregularities.

After hearing an appeal, the appellate court may either affirm, amend, or reverse the initial court’s judgment.

Indonesian civil procedure does not include specific provisions regarding the court’s authority to order the payment of costs. Typically, the losing party is responsible for covering court fees, which encompass the operational costs of the proceedings and the registrar’s fees, including expenses like stamp duty and the distribution of submitted documents and notices.

Nevertheless, as per Supreme Court Decision No 3557 K/Pdt/2015, dated 29 March 2016, each party must bear its own legal expenses. In this particular case, the Supreme Court denied the request for the losing party to pay the winning party’s legal costs.

Civil court fees are set by the head of the district court through a formal decree and are calculated based on factors such as the number of parties involved; the distance to the summoned party’s location; and administrative costs.

The plaintiff is required to pay the determined fees as a deposit when filing the case. If the initial deposit proves insufficient, the court may request additional funds. Conversely, any unused portion of the deposit will be refunded to the plaintiff.

For economically disadvantaged individuals, there is an exemption service (prodeo), which allows individuals or groups with limited financial resources to litigate without paying court fees.

Interest is not awarded on litigation costs.

In Indonesia, ADR is increasingly encouraged and respected, especially as a means to relieve court congestion, promote quicker resolutions, and foster amicable settlements between parties. The Indonesian legal framework actively supports ADR methods, particularly mediation, arbitration, and conciliation, which are commonly used across various sectors, including commercial, civil, and labour disputes. This includes mediation (court-mandated or otherwise), arbitration, conciliation, and negotiation.

The Indonesian legal system actively promotes ADR, especially mediation, as an essential part of the civil litigation process.

Mediation is mandatory at the initial stage of most civil cases. Under Supreme Court Regulation No 1 of 2016 on Mediation Procedures in Court, judges are required to order mediation before the case proceeds to trial. There are indirect consequences for parties who do not engage in good faith during court-ordered mediation, although there is no strict penalty for outright refusal.

The BANI Arbitration Centre is the leading institution for arbitration in Indonesia and has a strong reputation for handling domestic commercial disputes. It provides a structured framework for arbitration, offering standardised procedures and experienced arbitrators. It is respected for its impartiality and expertise in complex commercial matters.

Indonesia also has specialised ADR institutions for sectors such as labour, financial services, and consumer disputes. This includes the following.

• The Financial Services Authority (Otoritas Jasa Keuangan or OJK) which promotes ADR for resolving financial sector disputes.
• The Consumer Dispute Settlement Agency (Badan Penyelesaian Sengketa Konsumen or BPSK) which handles consumer-related disputes and provides mediation and arbitration services.

In Indonesia, arbitration and the enforcement of arbitral awards are governed by Law No 30 of 1999 (the “Arbitration Law”). In addition, a recent Supreme Court Regulation, Supreme Court Regulation No 3 of 2023 was issued to regulate the arbitration procedure in greater detail (“PERMA 3/2023”). PERMA 3/2023 establishes the legal framework for conducting arbitration proceedings and sets out the procedures for recognising and enforcing both domestic and international arbitral awards.

Indonesia is also a signatory to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”). International awards are therefore enforceable in Indonesia, provided they meet the requirements under the New York Convention and the Arbitration Law.

Certain subject matters cannot be resolved through arbitration due to their public interest nature or legal restrictions. The Arbitration Law specifies that only disputes involving commercial interests can be referred to arbitration. The following subject matters are generally not arbitrable.

• Criminal matters.
• Family law matters.
• Bankruptcy and insolvency.
• Administrative and public law disputes.
• Employment and labour disputes (excluding disputes between labour unions).

In Indonesia, parties may challenge an arbitral award in very limited and specific circumstances, as arbitral awards are generally considered final and binding. However, parties are given the opportunity to file a request to annul a domestic arbitration award if there are grounds to suspect that the award involves any of the following elements.

• A letter or document submitted during the examination, later acknowledged or declared false after the award has been rendered.
• The discovery of a decisive document, hidden by the opposing party, that only surfaces after the award has been issued.
• The obtaining of an award through deception or fraudulent conduct by one of the parties during the examination of the dispute.

The above is not applicable to a foreign arbitration award. However, foreign award enforcement may be refused based on Article 66 of the Arbitration Law if the award:

• was issued in a country that lacks a bilateral or multilateral recognition and enforcement treaty with Indonesia;
• falls outside the scope of commercial law under Indonesian law; or
• contravenes Indonesia’s public policy.

Under Article 59 of the Arbitration Law, domestic arbitration awards must be registered with the district court in the respondent’s domicile within 30 days of issuance. Once the award has been signed by the chief of the district court with an enforcement order, it is enforced following the procedure for executing final and binding court judgments.

Enforcement of foreign awards is handled by the Central Jakarta District Court, and decisions regarding enforcement are not open to appeal or cassation. However, under Article 66 of the Arbitration Law, enforcement of foreign awards may be denied if the conditions outlined in 13.3 Circumstances to Challenge an Arbitral Award are met.

There are no proposals for dispute resolution reform.

The Supreme Court has recently taken a proactive approach to longstanding challenges within Indonesia’s arbitration framework. With the issuance of PERMA 3/2023, the Supreme Court has introduced amendments aimed at clarifying procedures and addressing previous legal ambiguities.

PERMA 3/2023 addresses a host of issues, including security confiscation; specific procedures for annulment proceedings; reaffirming national courts’ authority over annulments of national awards; suspension of enforcement proceedings; preservation of arbitrators’ immunity; electronic submissions; and the introduction of the definition of “public order”.

The Supreme Court has also issued Circular Letter No 3 of 2023 (“CL 3/2023”) to resolve issues related to foreign language agreements among private entities. CL 3/2023 clarifies that agreements will not be invalidated solely for lacking an Indonesian version, unless bad faith in omitting the Indonesian language can be shown.