Shipping 2026

INDONESIA Law and Practice Contributed by: Stephen Igor Warokka and Mutiara Kasih Ramadhani, SSEK Law Firm

9.4 International Conflict Articles 464 and 465 of the ICC allow for the termi - nation of an agreement by providing written notice to the other party, if the enforcement of the agree - ment is obstructed due to the outbreak of war, and the obstruction cannot be resolved within a reason - able time. If the ship is carrying freight or passengers and is not in port at the time of termination, it must proceed to the nearest seaport. In all cases where the agreement is terminated prior to its completion, the ICC requires that freight costs remain payable in full up to the last day of the contract. In relation to war risk insurance coverage, Articles 646 and 647 of the ICC provide that in the case of an insurance agreement that includes the term “free from damage”, the insurer will be liable for damage unless the insured goods are destroyed due to acts of violence, robbery, hijacking, detention by order of a ruler, a declaration of war or acts of retaliation. At the time of writing, there are no legal precedents regard - ing defaults or non-performance of obligations caused by ongoing international conflicts in publicly available court decisions. 10. Additional Maritime or Shipping Issues 10.1 Other Jurisdiction-Specific Shipping and Maritime Issues Previously, under MOT Regulation No 89 of 2018 regarding the Norms, Standards, Procedures and Criteria for the Electronically Integrated Business Licensing System in the Sea Transportation Sector, a SIUPAL was required for businesses in the sea trans - portation sector. Indonesia has now adopted a risk- based licensing regime where business licences will be assessed and granted in line with the risk of the business activity. With the implementation of the risk-based licensing regime, the SIUPAL has been replaced by a Stand - ard Certificate, pursuant to MOT Regulation No 12 of 2021 regarding Standards of Business Activities and Products in the Implementation of Risk-Based Busi - ness Licensing in the Transportation Sector, as lastly amended by MOT Regulation No 13 of 2023, which is

Both of the circular letters make reference to Annex VI of the MARPOL Convention. In summary, the circular letters provide that, as of 1 January 2020, ships sailing in Indonesian territory are required to use fuel with a sulphur content not exceed - ing 0.5% mass by mass (m/m). Indonesian-flagged ships that still use fuel with a sulphur content greater than 0.5% m/m must be equipped with an exhaust gas cleaning system or scrubber as approved by the Directorate General of Sea Transportation. Nonethe - less, all Indonesian-flagged vessels sailing interna - tionally are prohibited from transporting or carrying fuel with a sulphur content greater than 0.5% m/m for propulsion/the propulsion system or fuel for the operation of other equipment on board, starting 1 March 2020, unless exempted under the MARPOL Convention. 9.3 Trade Sanctions Indonesia does not recognise or enforce any inter - national trade sanctions as part of its domestic law. Indonesia also does not exert general restrictions on specific jurisdictions carrying out trading activities, although it does impose temporary export and/or import restrictions on certain products from certain jurisdictions. For example, Indonesia issued Minis - ter of Trade Regulation No 10 of 2020 on Temporary Restriction on the Import of Living Animals from the People’s Republic of China in response to the COV - ID-19 pandemic, and ratified the 1988 UN Convention Against Illicit Traffic in Narcotic Drugs and Psycho - tropic Substances, through Indonesian Law No 7 of 1997. Indonesia became a member of the World Trade Organisation with the ratification of the Agreement Establishing the World Trade Organisation by virtue of Law No 7 of 1994 and therefore can impose trade sanctions as a countermeasure or “retaliatory action” in the case of a non-fulfilment of obligations pursuant to the rules of the WTO. Indonesia has not imposed any trade sanctions in relation to the Russia-Ukraine war, and continues to partake in trade activities (eg, exports and imports) with both states.

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