Indonesia, the state of law
as many other countries in the world had recognized the law from
the very beginning time before its independency on 17 August 1945.
Since the past time and based on some research from the ancient
history, Indonesia has many different royal families’ lies
from Sabang to Merauke (the two cities lies in the East and West,
pictured Indonesia as the country of islands lies from East and
West, boundaries by Hindian Ocean).
The royal families had formed many different societies of laws which
have been known and used by many law schools in Indonesia as “Hukum
Javanese law, Padang
law, Batak law, Aceh law, Irian law, Kalimantan law are Hukum Adat
or the society’s of laws in Indonesia that classify the moral
principles of each society based on their culture, unique characteristics
and ethics which they have build to survive with their lives and
communities. Yet, many of the elements of this Hukum Adat still
can be recognized in some of the laws and regulations applied in
Indonesia at this current time, particularly for certain laws and
regulations applied for each province.
During the Dutch colonialism
for almost three hundred and fifty years before Indonesia’s
independency, Indonesia had adopted most of the Dutch values of
law to be applied in their societies as the result of the colonialism.
Thus, after its independency, Indonesia still adopted such law to
be applied in their society.
of Indonesian law
After its independency,
Indonesia claimed their country as a democratic country with 27
provinces based on its constitution which we called as Pancasila
and Undang-undang Dasar 1945 (nowadays the provinces have increased
to become 36 provinces).
the state of law, Indonesia had adopted the Civil Law (Code Law)
derived from the Dutch law as the result of the colonialism. This
law which originated from the Roman Empire has the function to establish
a body of legal rules which judicial decisions (case law) are not
a source of law, as contrasted with the Common law or the United
has become a greatest Moslems population among the world, still
Indonesia has not claimed itself as the Islamic country, such as
Malaysia or the Middle East countries, but still, most of the Islamic
values have many important roles in determining the laws and regulations
The Civil Law, adopted
from the Dutch Law, recognized and formed the certain important
basic laws and the systematic codes in Indonesia, which we called
as Kitab Undang-undang Hukum Perdata (Burgerlijk Wetboek) or the
Civil Code, the laws concerning with civil rights and remedies,
Kitab Undang-undang Pidana, the Criminal Code and Kitab Undang-undang
Hukum Acara Pidana, the Criminal Procedures Code, the laws concerning
with the criminal acts and criminal procedures brought to the court.
There was also Kitab
Undang-undang Hukum Dagang (Wetboek van Koophandel) or the Commercial
Code, the law concerning the commercial contracts and regulating
the eligible legal bodies to carry out their business in Indonesia.
This law now has replaced by the new Law since the enactment of
the new Company Law Number 1 in the year of 1995, concerning the
Limited Liability Company together with its implementations. Following
to this Limited Liability Company Law, in the year of 1999, the
Government also issued the New Bankruptcy Law which some of the
clauses adopted from the Chapter Eleven from the United States law.
Some thoughts say that the Limited Liability Company Law and the
Bankruptcy Law have become a breakthrough for the development of
the legal system in Indonesia in the era of nineteenth century.
Not mentioning other laws that derived from the Code Law, we also
have the Land Law that adopted and derived from many Hukum Adat
values as the implementation of Indonesian cultures and hence to
accommodate the different cultures and characteristics of many provinces
in Indonesia. This Land Law, concerning the title or ownership of
the land and the land acquisition procedures, has also been renewed
and revised by the Government in year 1960.
Also, to participate
in the global capital market, the Government has enacted the Capital
Market Law in 1995, together with its implementations which regulates
many important issues for certain companies both local and foreign
direct investment companies in taking part in the globalization
and in particularly in the capital market area.
During the crisis
in 1997, Indonesia has struggled to settle their debts derived from
the 36 collapsed banks as the impact of soared of the Dollar rate
against Rupiah rate. These debts have increased for almost IDR 600
trillion at that time.
Through adopting the
Thailand system when Thailand struggling with the economy crisis
as the impact of the weaken Baht which forced the Thailand government
to establish the Debt Restructuring Body to restructure the debts,
and followed by that, Indonesia has established new body called
the Indonesian Banking Restructuring Agency (IBRA) which has the
very important roles to restructure the IDR 600 trillion debts in
the five years period.
To enforce the process
of this body, the Government has enacted the Government Regulation
Number 17 in the year 1998 for the IBRA’s establishment. The
important parts of IBRA is to restructure the collapsed banks by
way of debt restructuring, eg, take over the collapsed banks by
the Government, freeze the collapsed banks, or to settle the debts
from collecting the money from the shareholders of the banks who
are responsible in restructuring their debts in the collapsed banks.
At the end, given the fact that there are so many Indonesian laws
and regulations which have been renewed, revised and issued by the
Government of Indonesia to accommodate the current condition and
to meet the needs in facing the era of the globalization in the
world, we are here to assist you in reviewing, analyzing, and summarize
the reliable Indonesian legal sources and regulations which will
give you clear understanding on how to implement such regulations
based on to your needs.