On 15 December 2021, the Constitutional Court has issued a decision that significantly affects the Indonesian Commercial Court, as reflected through Constitutional Court Decision No.23/PUU-XII/2021. Due to this, it is now feasible to pursue cassation as legal means against PKPU Decisions. In this Legal Alert, we also have examined example of cases in 2022 which implemented the Constitutional Court Decision No.23/PUU-XII/2021 for your reference

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Legal Alert March 2023
Cassation Against the Suspension of Payment
Decision and Its Implementation
I. General Overview
Request on Suspension of Payment (Penundaan Kewajiban Pembayaran
Utang or “PKPU”) in Indonesia is a mechanism that can be done by a debtor who
faces financial obstacles in settling his/her debts. The objective of requesting
PKPU is to provide an opportunity for the debtor to conduct financial restructuring
to amend its company’s financial condition so that it will be capable of repaying its
debts in a gradual and timely manner. In general, provisions on PKPU in Indonesia
are specifically laid down in Article 222 until Article 294 Law Number 37 of 2004
on Bankruptcy and Suspension of Payment (“Law No. 37/2004”).
In Indonesian procedural law, there is a legal means which is given as a right to
parties allegedly disadvantaged or dissatisfied with the first instance court
decision. This mechanism is meant to provide protection and legal certainty for the
people. However, although it is considered different from the commercial court in
PKPU cases, there is a provision that may restrict the application of legal means
against PKPU decision as stated in Article 235 (1) of Law No. 37/2004, which
stipulates “there shall be no legal means that can be filed against PKPU decision.”
Based on the restriction referred to above, there have been cases where
companies that might still be able to maintain a positive prospective of their
business yet be restricted to do so due to bankruptcy decisions issued by the court
with no possibility to conduct any legal means against such. This situation also
occurred against PT Sarana Yeoman Sembada, which believed its rights had been
violated. Due to this, PT Sarana Yeoman Sembada requested judicial review of
Article 235 paragraph (1) and Article 293 paragraph (1) of Law No. 37/2004 against
the 1945 Constitution of the Republic of Indonesia (“UUD 1945”) to Constitutional
Court under case number 23/PUU-XII/2021 (“MK Decision No. 23/2021”) with the
verdict as follows:
1. To grant the request by the Applicant partially;
2. To declare Article 235 (1) and Article 293 (1) Law No. 37/2004 on
Bankruptcy and Suspension of Payment (State Gazette of Republic of
Indonesia of 2004 Number 131 and Additional State Gazette Number
4443) as against the 1945 Constitution of Republic of Indonesia and do
not confer binding legal force, so long as such provisions are not defined
as, “to allow cassation against PKPU decision requested by the creditor
and the rejection of reconciliation proposal from the debtor:
3. To instruct the decision to be duly stated in State Gazette of Republic of
Indonesia;
4. To reject requests by Applicant for other matters and beyond.
With the issuance of the decision as mentioned above, an opportunity has been
provided for any party to file cassation against PKPU decisions derived from the
request made by creditors against debtors. However, referring to MK Decision No.
23/2021, the Supreme Court has not yet provided any further explanation on the
procedures to file a cassation application, specifically on whether the cassation
On 15 December 2021, the
Constitutional Court has
issued a decision that
significantly affects the
Indonesian Commercial
Court, as reflected through
Constitutional Court
Decision No.23/PUU-
XII/2021. Due to this, it is
now feasible to pursue
cassation as legal means
against PKPU Decisions.
In this Legal Alert, we also
have examined example of
cases in 2022 which
implemented the
Constitutional Court
Decision No.23/PUU-
XII/2021 for your
reference.

2. AHRP Legal Alert Page 2 of 4
mechanism would be the same as the provisions on bankruptcy decision in Law
No. 37/2004 or the provisions on Law Number 14 of 1985 on Supreme Court (“Law
No. 14/1985”).
I. Application for PKPU and Legal Means against PKPU
1. Procedures for PKPU Application
(i) Submission of PKPU Application
The application must be submitted by either debtor1 or creditor2 to the
authorized Commercial Court. The application shall fulfill the requirements
as regulated in Article 222 Jo. Article 8 paragraph (4) of Law No. 37/2004.
(ii) Examination on Formality Requirements
Commercial Court will examine the formalities requirements upon
receiving the application. In the event the application has fulfilled the formal
requirements, Commercial Court will then attach the case number and to
publish such to the public along with its first proceeding schedule.
(iii) PKPU Examination Proceeding
Commercial Court will conduct the examination proceeding to determine
whether the PKPU application can be approved or rejected. In this stage,
the creditor and debtor will be summoned to provide related explanations
and evidence on the companies’ financial conditions.
(iv) PKPU Decision
Commercial Court will issue decision on whether the application for PKPU
will be approved or not. If the application is approved, the court shall
temporarily halt the obligation to repay debts by debtor and debtor is
obliged to immediately arrange composition plan which comprises of
characteristics and steps to repay debts to all creditors.3 Additionally, the
administration and management for all of debtors’ assets shall be done by
debtors along with the administrators.
(v) Execution of Restructuration Result/Composition Plan
After the decision and announcement on the approval of the PKPU
application, the debtor shall conduct financial restructuration, which will be
drafted in a composition plan to be offered by all the listed and
acknowledged creditors.4
2. Cassation as Legal Means against PKPU
As previously explained, legal means refer to the rights provided to parties
allegedly disadvantaged or dissatisfied with the first instance court
decision, with the aim to provide protection and legal certainty to the
1
Article 222 (1) Law No. 37/2004.
2
Article 222 (3) Law No. 37/2004.
3
Article 237 (1) Law No. 37/2004.
4
Article 265 Law No. 37/2004.

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people. Before the issuance of MK Decision No. 23/2021, Law No. 37/2004
provides the possibility to file for cassation5 and judicial review6 against
bankruptcy decision to the Supreme Court. Such provisions were in
contradiction with provisions on the PKPU decision as there were no legal
means available in the form of cassation.7
However, since the issuance of MK Decision No. 23/2021, the restriction
to file for cassation against PKPU decision is considered unconstitutional
against UUD 1945, in which such legal means can now be asserted
through Commercial Court.8 Nonetheless, there has been no further
clarification from the Supreme Court in regards to the MK Decision No.
23/2021, specifically on whether the cassation mechanism would be the
same as the provisions on bankruptcy decision in Law No. 37/2004 or the
provisions in Law No. 14/1985. In practice, there have been cases in the
cassation stage against PKPU decision at the
i. Requirements to Assert Cassation
Pursuant to the verdict stated in MK Decision No. 23/2021, which has
partially approved the requested judicial review, Article 235 paragraph (1)
and Article 293 paragraph (1) of Law No. 37/2004 are considered
conditionally unconstitutional.
The said articles shall be considered as unconstitutional in the event the
conditions provided as per MK Decision No. 23/2021 are not fulfilled. In
contrast, the said articles shall be considered in conformity with UUD 1945,
when the following conditions are being fulfilled:
a. PKPU request shall be submitted by the creditor; and
b. the proposed composition plan submitted by debtor is rejected by the
creditor.
In the event the abovementioned conditions are not fulfilled by the
cassation applicant, the Supreme Court shall consequently reject the
submitted cassation application.
ii. Procedures to Submit Cassation Against PKPU Decision
As seen from the Panel of Judges’ consideration in MK Decision No.
23/2021, the Supreme Court is required to immediately constitute
regulation in relation to mechanism to submit cassation against PKPU
decision where such decision is requested by the creditor and the
subsequent composition plan by debtor is rejected by creditor.9
Although there has been no further indication of the issuance of such
regulation by the Supreme Court, the referral to MK Decision No. 23/2021
to assert cassation application has been raised in the case of Yayasan
Rumah Sakit Sandi Karsa (vide chapter iii.a), as further explained in case
number 1262 K/Pdt.Sus-Pailit/2022 against PKPU decision number
5
Article 11 Law No. 37/2004.
6
Article 14 Law No. 37/2004.
7
Article 235 Law No. 37/2004.
8
Verdict Point (2) MK Decision No. 23/2021.
9
MK Decision No. 23/2021, pg. 110 para (1).

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1/PDT.SUS-PKPU/2022/PN.NIAGA.MKS, which was submitted and
resolved within the procedures and provisions as regulated in Law No.
37/2004. Similar action was also taken against the cassation application
asserted by PT Meratus Line in case number 1260 K/Pdt.Sus-Pailit/2022
dated 29 November 2022 (vide chapter iii.b).
II. Example of MK Decision No. 23/2021 Application
(a) Yayasan Rumah Sakit Sandi Karsa10
Yayasan Rumah Sakit Sandi Karya is a debtor who asserted a cassation
application against the PKPU decision which was previously submitted by
PT Mulya Husada Jaya as a creditor in case number 1/PDT.SUS-
PKPU/2022/PN.NIAGA.MKS as decided on 24 May 2022.
As Yayasan Rumah Sakit Sandi Karsa was declared bankrupt due to the
rejection of its composition plan by creditors, who believed that such plan
only comprised of reconciliation plan on principal claims and did not include
the plan to pay claims for the penalty.
Due to the reason above, in the cassation case number 1262 K/Pdt.Sus-
Pailit/2022, the Supreme Court issued a decision with the verdict that stated
the acceptance of the cassation application asserted by the applicant
(Yayasan Rumah Sakit Sandi Karya) by legally taking into consideration of
MK Decision No. 23/2021. The applicable procedure at the dispute a
quo was submitted and settled in accordance with the provisions as
regulated in Law No. 37/2004.
(b) PT Meratus Line11
PT Meratus Line asserted the cassation application against PT Bahana Line
in this case. The Panel of Judges of the Supreme Court also applied MK
Decision No. 23/2021 as the basis for legal consideration for such cassation
with case number 1260 K/Pdt.Sus-Pailit/2022 against decision No.
26/Pdt.Sus-PKPU/2022/PN Niaga Sby dated 31 May 2022.
However, the application of MK Decision No. 23/2021 was unsuccessful as
the cassation application by PT Meratus Line was rejected by the Panel of
Judges of Supreme Court as the Panel held that the application was too
early or premature to be followed by cassation application. When PT
Meratus Line decided to assert cassation application, PT Meratus Line was
not yet declared bankrupt, and there was only a Temporary PKPU decision.
Thus, it was not considered to fulfill the requirements as regulated in MK
Decision No. 23/2201, such as (1) PKPU request shall be submitted by the
creditor; and (2) the proposed composition plan submitted by the debtor is
rejected by the creditor. The applicable procedure at the dispute a quo was
submitted and settled per the provisions regulated in Law No. 37/2004.
10
Supreme Court Decision No. 1262 K/Pdt.Sus-Pailit/2022.
11
Supreme Court Decision No. 1260 K/Pdt.Sus-Pailit/2022.

5. This publication has been prepared by AHRP for educational and informational purposes only. The information contained in this publication is not
intended and should not be construed as legal advice. Due to the rapidly changing nature of law, AHRP makes no warranty or guarantee
concerning the accuracy or completeness of this content. You should consult with an attorney to review the current status of the law and how it
applies to your circumstances before deciding to take any action.
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