Key Features and Impacts of Supreme Court Regulation No. 3 of 2023 on Arbitration in Indonesia (Part 2)

by Eva Fauziah & Sri Purnama. Originally published in the Indian Journal of Arbitration Law (IJAL), an open-access student journal. with title “The Issuance of the Supreme Court Regulation No. 3 of 2023: An Assessment of Its Impact on Promoting Arbitration in Indonesia.” Indian Journal of Arbitration Law, 12(2), pp. 100-126.

The Supreme Court Regulation No. 3 of 2023 (SCR 3/2023) introduces several key features that significantly impact arbitration practices in Indonesia. These features aim to enhance the efficiency, clarity, and enforceability of arbitral awards, ultimately promoting arbitration as a preferred dispute resolution mechanism.

1. Appointment of Arbitrators and Rights of Recusal: SCR 3/2023 addresses the critical issue of arbitrator appointment when parties fail to reach an agreement. It empowers the Chairman of the Court to appoint arbitrators within a strict 14-day timeframe, ensuring the continuity of the arbitration process. Additionally, the regulation provides a mechanism for parties to challenge arbitrator impartiality, safeguarding the fairness and integrity of the proceedings.
2. Differentiation Between Domestic and International Arbitral Awards: The regulation distinguishes between domestic and international arbitral awards based on territorial jurisdiction and court jurisdiction. It outlines specific procedures and timelines for the registration, enforcement, and annulment of each type of award, providing clarity and legal certainty for parties involved in both domestic and international arbitration.
3. Registration Process for Arbitral Awards: SCR 3/2023 streamlines the registration process for arbitral awards, mandating electronic filing through the Court Information System. It sets clear deadlines for registration and emphasizes the importance of notifying parties about the award, ensuring transparency and fairness in the arbitration process.
4. Examination of Requests for Enforcement of Arbitral Awards: The regulation outlines detailed procedures for enforcing arbitral awards, both domestic and international. It allows parties to seek enforcement of specific portions of an award and provides avenues for legal recourse if enforcement is denied. The regulation also addresses the issue of simultaneous applications for enforcement and annulment of awards.
5. Guidelines for Annulment of Arbitral Awards: SCR 3/2023 provides comprehensive guidelines for the annulment of arbitral awards. It specifies the grounds for annulment, the process for filing an annulment request, and the legal remedies available to parties. The regulation aims to limit the scope for annulment to specific criteria, ensuring the finality and enforceability of arbitral awards.

Overall, SCR 3/2023 represents a significant advancement in Indonesian arbitration law. By addressing procedural gaps and aligning with international standards, the regulation enhances the efficiency and effectiveness of arbitration as a dispute resolution mechanism. It provides clarity and legal certainty for parties involved in arbitration, both domestic and international, and promotes the use of arbitration as a preferred alternative to litigation.

 

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Sri Purnama

Junior Legal Research Analyst

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