In general, the methods used to resolve commercial disputes in Indonesia are litigation, arbitration and alternative dispute resolution (ADR). The resolution of commercial disputes through arbitration or ADR (eg, mediation) is generally governed by the Law Concerning Arbitration and ADR, which recognises the principle of competence under which the district courts have no jurisdiction to try disputes between parties bound by an arbitration agreement.
The Ministry of Laws and Human Rights Regulation on the Settlement of Disharmony between Laws and Regulations through Mediation recently took effect. The regulation reinstates the possibility to settle disputes concerning laws and regulations outside the courts through the introduction of mediation, including disputes over ministerial regulations, non-ministerial government institution regulations, non-structural institution regulations and regional laws and regulations.
The Indonesia National Board of Arbitration (BANI) was established in 1977. In 2016 the Ministry of Law and Human Rights created BANI Pembaharuan (ie, the Renewed BANI), which claims that it is a revised version of the original BANI. However, the original BANI does not recognise the Renewed BANI and claims that it has been using the BANI name unlawfully. This duality could create uncertainty when commercial parties wish to appoint BANI as their dispute settlement forum.