The Duality of The Indonesia National Board of Arbitration (Badan Arbitrase Nasional Indonesia)
The Indonesia National Board of Arbitration (BANI) was established in 1977 by the Indonesia Chamber of Commerce and Industry (KADIN INDONESIA) with the Decree/SK No. SKEP/152/DPH/1977 on 30 November 1977, managed/governed by the Governing Board and Advisory Board composed of prominent public figures and business personalities. BANI has its headquarters in Mampang, Jakarta, and offices in major Indonesian cities, including Surabaya, Bandung, Pontianak, Denpasar, Medan, Palembang, and Batam.[1] BANI Mampang has long been established as the only non-court dispute resolution institution that carries out the function of handling cases through arbitration.
In 2015 the entire founder of BANI passed away. The heirs then agreed to establish the new BANI.[2] On September 8, 2016, BANI Renewal was made through the Minister of Law and Human Rights Decision Number AHU-0064837.AH.01.07.TAHUN 2016 of June 20, 2016. Located at Sovereign Plaza, the BANI Renewal is also called BANI Sovereign. The original BANI is now referred to as BANI Mampang due to its office being in Mampang, Jakarta.
In 2016 BANI Mampang filed a lawsuit to the Jakarta Administrative Court in order the Minister of Law and Human Rights Decision No. AHU-0064837.AH.01.07.TAHUN 2016 is null and void. In 2017 Jakarta Administrative Court granted all BANI Mampang lawsuit with Case Number 290/G/2016/PTUN JKT. BANI Sovereign appealed to the Jakarta High Administrative High Court and subsequently to the Supreme Court of the Republic of Indonesia. The Supreme Court upheld the Jakarta Administrative Court’s decision.[3]
Contrary to that, in 2016 BANI Sovereign filed a lawsuit against BANI Mampang in the South Jakarta District Court regarding the legal standing of BANI Mampang law and the right of heirs with Case No. 674/Pdt.G/2016/PN.Jkt Sel. In 2017, the South Jakarta District Court declared the Minister of Law and Human Rights Decision No. AHU-0064837.AH.01.07.TAHUN 2016 as valid. In 2018, the Jakarta High Court upheld the South Jakarta District Court’s decision.[4]
BANI Mampang also filed a lawsuit against BANI Sovereign to the Jakarta Commercial Court regarding the use of the BANI Mampang’s trademark. To this day, the final decision of the case is still unknowable.
This duality has made uncertainty over the enforcement efforts of the commercial parties in dispute. This will affect the validity of the decision issued by BANI, whether BANI Mampang or BANI Sovereign if the legal status of both is unclear. The parties who make the contract will also feel confused to choose a dispute resolution attempt by using the terminology of “BANI”. Whereas commercial dispute resolution efforts through arbitration mechanisms are the most effective and efficient way.
The clauses in the contract governing the dispute settlement attempt by the arbitration may be renegotiated either before the parties make an agreement or after the agreement runs as addendum material.
Law No. 30/1999 on Arbitration and Alternative Dispute Resolution do not govern the settlement regarding dispute resolution through an arbitration mechanism being in a particular institution. There may be more than one institution to handle settlement through arbitration mechanisms, such as the Indonesian Capital Market Arbitration Board (BAPMI) and the Indonesian Insurance Mediation and Arbitration Board (BMAI).
However, the parties need to require a legitimate and recognized arbitration institution. The parties generally tend to be reluctant to settle commercial cases through the General Courts for reasons of effectiveness and efficiency. Besides, the dispute resolution efforts through the arbitral institutions are much secure and confidential.
[1] The Indonesia National Board of Arbitration, https://www.baniarbitration.org/, accessed on November 8, 2019
[2] Makarim & Taira S., Bani Legal Status Is Up In The Air, https://www.makarim.com/uploads/904361_M&T%20Advisory%20-%20BANI%20Legal%20Status%20Up%20in%20the%20Air%20(April%202019).pdf/, accessed on November 8, 2019
[3] Mahkamah Agung Republik Indonesia Decision No. 232 K/TUN/2018 that cancel the decision of the Jakarta High Administrative Court with No. 265/B/2017/PT.TUN Jkt on November 21, 2017
[4] Hukum Online, Contradiction of BANI Ruling Dispute, https://www.hukumonline.com/berita/baca/lt5ba1d9132b656/kontradiksi-putusan-sengketa-kepengurusan-bani/, accessed on November 8, 2019
