INDONESIA Trends and Developments Contributed by: Nico Angelo Putra Mooduto, Mahareksha Singh Dillon, Talitha Amanda Ekadhani and Bagas Ananta, SSEK Law Firm
New Arbitration Rules at BANI The Indonesian National Arbitration Board ( Badan Arbitrase Nasional Indonesia or BANI) has long been the country’s most prominent arbitration institution. However, its rules had lagged behind those of lead- ing arbitral centres such as SIAC, HKIAC, and ICC. Users criticised BANI for limited procedural tools and inconsistent efficiency. In response, BANI issued its new arbitration rules in April 2025. Key innovations include: • Emergency Arbitration: Parties can now seek urgent interim relief before a tribunal is fully con- stituted. The rules impose strict timelines for the appointment of emergency arbitrators and for rendering decisions. This feature aligns BANI with leading arbitral institutions worldwide and provides a tool for parties needing immediate protection of assets or evidence. • Multiparty and Multicontract Arbitration: The new rules expressly allow for consolidated proceed- ings involving multiple contracts or parties. Given that Indonesian commercial projects often involve complex webs of contracts, such as infrastructure, energy, and financing deals – this reform reduces the risk of inconsistent awards and parallel pro- ceedings. • Mandatory Indonesian Co-Counsel: The rules require any party represented by foreign counsel to also appoint Indonesian co-counsel, regardless of the governing law of the contract. This ensures local legal expertise is integrated into proceedings and strengthens the legitimacy of awards within Indonesia’s judicial system. For multinational companies and investors, these reforms present both opportunities and challenges: • Emergency arbitration enhances protection of rights and assets in fast-moving disputes. • Consolidation rules reduce costs and improve effi- ciency in complex, multiparty projects. • The co-counsel requirement increases compliance costs but provides valuable local expertise that can prevent enforcement hurdles later.
Some sector-specific impacts that should be consid- ered are as follows: • Infrastructure and Construction: Contractors, subcontractors, and financiers frequently appear in related disputes. Multiparty arbitration will help avoid contradictory results. • Financial Services: Banks and investors may use emergency arbitrators to secure interim measures on collateral. • Energy and Resources: Joint ventures and produc- tion sharing contracts often involve overlapping parties. Consolidation will simplify resolution. These changes bring Indonesia closer to international best practices, but clients must plan for the practical realities. Emergency arbitration in BANI, while prom- ising, will depend heavily on judicial co-operation for enforcement. Companies seeking interim relief, such as freezing assets or stopping ongoing breaches, must be ready to act swiftly and co-ordinate closely with Indonesian counsel. The consolidation provisions also have far-reaching consequences. In public–private partnership (PPP) projects, disputes may arise across concession agree- ments, financing contracts, and construction subcon- tracts. Under the new rules, parties could potentially consolidate into one arbitration, saving time but also increasing complexity. In such cases, early contract mapping and consistent dispute resolution clauses across related contracts become critical. Overall, the new BANI rules mark a decisive step toward making Indonesia a more credible and com- petitive arbitration hub. Supreme Court Issues Conflict-of-Interest Rules to Safeguard Judicial Impartiality To reinforce impartiality and transparency in the judi- cial process, Indonesia’s Supreme Court ( Mahkamah Agung or MA) has enacted Decree No 15/KMA/ SK.HK2/II/2025 (“Decree 15/2025”) on Guidelines for the Prevention and Management of Conflicts of Inter- est. Effective since February 2025, this decree estab- lishes a comprehensive framework to prevent judges’ personal, familial, or financial interests from affecting court decisions.
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