Arbitration considered as an effective dispute resolution forum to get the best result.
Commercial disputes become one of inevitable consequence in the business. The dispute can arise between parties which located in Indonesia or abroad. Arbitration as a dispute resolution becomes popular in the business for its many advantages. One of the advantages is a settlement in arbitration forum is strictly confidential. The hearing only can be attended by the related party, so the dispute will not revealed to the public..
There are two efficiency forms obtained when choosing the settlement of disputes in arbitration, namely the cost and time efficiency.
In arbitration process, the costs are transparent. You will be provided with detail cost required, since the beginning the parties are be able to know how much the cost to be incurred. There is no unexpected cost that suddenly came out during the process.
In terms of time, the process of settling disputes through arbitration is faster than the litigation process in court. According to Law No. 30 of 1999 concerning Arbitration and Alternative Dispute Resolution (“Arbitration Law”), arbitration process must be completed within 180 days from the date of appointment of the arbitrator of the panel of arbitrator. But, with the consent of the parties and if required, the period can be extended.
Further, there is no legal remedies provided against the arbitral award. The loosing party can not appeal the arbitration award since an arbitration award is final and binding.
The other advantages are regarding the “judge” who handled our case. The parties have a right to appoint an arbitrator who has a knowledge and competencies in the field that related to our case. According to the Arbitration Law, the basic requirement to be an arbitrator is at least has an experience in the specific field for 15 years.
Before the hearing is conducted, the arbitrators already study the case and understand the issues presented in the claim. which has been given prior to the first hearing. The arbitrators already understand the issue of the case, not only from a legal perspective but also from their technical aspect.
However, there is also concern related to the execution of the arbitration award since arbitration is not a judicial body. They worried the arbitration award cannot be executed. In contrary, after the award is registered, the applicant can execute the award for their interest. (Read: Registering Procedure of Arbitration Award Before the District Court)
Please note that Indonesia has ratified the New York Convention 1958 regarding the Recognition and Enforcement of Foreign Arbitral Award (“New York Convention”). Therefore, the International Arbitration Award also can be executed in Indonesia, so long there are reciprocal agreement between the origin country of the arbitral award issued with Indonesian government.
Source: BP Lawyers