A Study of Commercial Arbitration and the Autonomy of the Indonesian Arbitration Law

Evita Isretno Israhadi

Abstract

Arbitration agreement between the parties is an important source of law in the arbitration proceeding, especially in commercial arbitrations. The commercial arbitration in Indonesia is monitored by permanent commercial arbitral tribunals for various fields. With the increase of commercial transactions, arbitration too has become a necessity. Out of court settlement has become the choice of business entities to resolve their disputes, which is consistent with the global practices. The problems begin when according to Indonesian Law district courts are not authorized to adjudicate disputes of parties bound by arbitration agreements. This grants autonomy to arbitration tribunals such as Indonesian National Board of Arbitration (Badan Arbitrase Nasional Indonesia)-BANI and the parties are liable to accept its verdict. This study proposes to understand the arbitration law of Indonesia, particularly to highlight its autonomous nature and to view it in the light of limitations and constraints. The result of discussion will be an input for Indonesia to amend its Arbitration Law.