In general, arbitration procedures are regulated under Law No. 30 of 1999 on Arbitration and Alternative Dispute Resolution (“Arbitration Law”). In the last quarter of 2023, the Supreme Court issued SC Regulation No. 3/2023. As part of the regulatory framework under Arbitration Law, this regulation sets out further details in arbitration procedures, among others, the court-ordered appointment of arbitrators, right to challenge, and the enforcement as well as the annulment of arbitral awards. Key Provisions of SC Regulation No.3/2023 1. Recognition of Sharia Arbitration; 2. Appointment of Arbitrator and Right to Challenge; 3. Registration and Enforcement of Arbitral Award; and 4. Annulment of Arbitral Award; This regulation aims to streamline arbitration processes and ensure clarity and fairness in the resolution of disputes through both conventional and Sharia arbitration mechanisms.

1. Supreme Court Regulation
No. 3 of 2023
on
Procedure for Appointment of Arbitrator by the
Court, Right to Challenge, Examination of
Application for Execution, and Annulment of
Arbitral Award
Fitri Nabilla Aulia

2. Issuance of SC Regulation
No.3/2023

3. In general, arbitration procedures are regulated under Law No. 30 of 1999 on
Arbitration and Alternative Dispute Resolution (“Arbitration Law”).
Issuance of SC Regulation No. 3/2023
In the last quarter of 2023, the Supreme Court issued SC Regulation No.
3/2023. As part of the regulatory framework under Arbitration Law, this
regulation sets out further details in arbitration procedures, among others, the
court-ordered appointment of arbitrators, right to challenge, and the
enforcement as well as the annulment of arbitral awards.

4. 1. Recognition of Sharia Arbitration;
2. Appointment of Arbitrator and Right to Challenge;
3. Registration and Enforcement of Arbitral Award; and
4. Annulment of Arbitral Award;
Key Provisions of SC Regulation No.3/2023

5. Recognition of Sharia
Arbitration

6. Arbitration and Sharia Arbitration
Arbitration is a method for civil dispute settlement outside of general
judiciary, which is based on arbitration agreement that is made in writing by
both disputing parties. (Article 1 point 1 of Arbitration Law and Article
point 1 of SC Regulation No. 3/2023)
Sharia Arbitration is a method for civil dispute settlement outside of general
judiciary, which is based on sharia arbitration agreement that is made in
writing by both disputing parties. (Article 1 point 3 of SC Regulation No.
3/2023)

7. Arbitration and Sharia Arbitration
Sharia Arbitration has long been existing and developing in Indonesia, as it
can be traced back to the establishment of Indonesia’s Sharia Arbitration
Institution back in 1993 (previously known as BAMUI, now known as
BASYARNAS). Its development now has been further strengthened by its
expressed recognition under SC Regulation No. 3/2023.
Chapter VI and Chapter VII of Arbitration Law only regulates the
competence of district courts for registration and enforcement as well as
annulment of arbitration awards.

8. Sharia Arbitration under SC Regulation No. 3/2023
Article 2 of SC Regulation No. 3/2023 stipulates that the religious
court/sharia court has the authority to examine exequatur and annulment
requests of sharia arbitration awards.
Article 3 of SC Regulation No. 3/2023 stipulates The Registrar of Claims
(kepaniteraan gugatan) has the authority to accept registration of exequatur
and annulment requests of sharia arbitration awards in religious courts/sharia
courts.

9. Appointment of Arbitrator
and Right to Challenge

10. Under Arbitration Law:
Under Article 13 of Arbitration Law stipulates, in the event that both parties cannot reach an agreement regarding
the appointment of arbitrator or if there is no provision made regarding the appointment of arbitrator, the chairman
of District Court shall designate the arbitrator or arbitral tribunal.
Further, Article 14 of Arbitration Law stipulates, in the event that both parties have agreed that the dispute which
is occurred will be examined and judged by a sole arbitrator, both parties must reach an agreement on the
appointment of the sole arbitrator.
If within 14 (fourteen) days after the defendant has received the claimant’s proposal, both parties fail to appoint
the sole arbitrator, based on petition of a party, the chairman of District Court may appoint the sole arbitrator.
Appointment of Arbitrators
The Arbitration Law does not regulate in detail the procedures on the appointment of arbitrators by the court.

11. Under SC Regulation No. 3/2023:
In the event that the parties do not reach an agreement on the appointment of the Arbitrator, the
parties or one of the parties can submit a request to the chairman of the court to appoint an
Arbitrator or Arbitral Tribunal.
Appointment of Arbitrators
The Chairman of the District Court hears the parties along with the reasons for the disagreement
Within 14 calendar days of the submission of the request, the Chairman of the District Court
issues a determination/stipulation (penetapan) appointing the arbitrator or the arbitral tribunal

12. Right to Challenge
Upon arbitrator, a challenge claim (tuntutan ingkar) may be submitted if there are sufficient
authentic evidences which raise doubt that the arbitrator will perform his/her duties not
independently when rendering an award. Challenge claim toward an arbitrator may also be
submitted if it has been proven that there is a familial, financial or employment relationship with
either one of the parties or its counsel. (Article 22 of Arbitration Law).
Right to Challenge of the Appointment of Arbitrator by the Parties
Article 24 of Arbitration Law:
Party who has objection against the appointment of an arbitrator by the other party, must submit the
challenge claim within 14 (fourteen) days since the appointment.

13. Right to Challenge of the Appointment of Arbitrator by the Court
Under Arbitration Law:
Article 23 of Arbitration Law stipulates, right to challenge against the arbitrator who was
appointed by the chairman of District Court shall be submitted to the relevant District Court.
Further, Article 24 paragraph (2) of Arbitration Law stipulates arbitrator who is appointed by the
court, may only be challenged based on reasons which are known after receiving the court
stipulation (penerimaan penetapan pengadilan).
Under SC Regulation No. 3/2023:
Article 4 paragraph (4) stipulates, right of challenge against stipulation of chairman of district
court regarding the appointment of an arbitrator, may be filed no later than 14 (fourteen) days
from the date of stipulation, if there are sufficient reasons and sufficient authentic evidence to
raise doubts to his/her impartiality or independence.

14. Right to Challenge of the Appointment of Arbitrator by the Court
Under SC Regulation No. 3/2023:
The Chairman of the Court then conducts an examination by listening to the Claimant and the
Respondent's response.
The Chairman of the Court shall issue a stipulation (penetapan) on right to challenge request no
later than 14 (fourteen) days after receiving the request.

15. Right to Challenge of the Appointment of Arbitrator
Article 25 of Arbitration Law and Article 5 paragraph (1) of SC Regulation No. 3/2023:
In the event that the challenge claim (tuntutan ingkar) is submitted by one of the parties is not
approved by the other party and the relevant arbitrator is unwilling to resign from his/her position,
the refusing parties may submit a claim in the form of request to the Chairman of District Court.
The Chairman of the District Court hears the parties along with the reasons for the disagreement
The Chairman of the Court shall give a decision no later than 14 (fourteen) days after receiving the
request.
There is no legal remedy against the decision.

16. Registration and
Enforcement of
Arbitration Award

17. Registration and Enforcement of Arbitration Award
Types of Arbitration Awards:
1. Domestic Arbitration Awards; and
2. International/Foreign Arbitration Awards.

18. Arbitration Law does not specifically stipulates the registration of arbitration awards.
Under Arbitration Law, the registration of arbitration awards stipulated in Chapter VI
regarding Enforcement of Arbitration Awards.
SC Regulation No. 3/2023 differentiates the registration and enforcement procedures of
arbitration awards. Registration of arbitration awards stipulated under Chapter IV of SC
Regulation No. 3/2023 on Registration of Arbitration Awards. Enforcement of arbitration
awards stipulated under Chapter V of SC Regulation No. 3/2023 on Enforcement of
Arbitration Awards.
Registration and Enforcement of Arbitration Award

19. Registration of
Arbitration Award

20. Registration of Domestic Arbitration Awards
Article 59 of Arbitration Law and Article 6 of SC Regulation No. 3/2023:
No later than 30 (thirty) days from the date the decision is pronounced, the original or
authentic copy of the Domestic Arbitration Award/Domestic Sharia Arbitration Award
shall be submitted and registered by the Arbitrator or his/her proxy to the Registrar of the
Court. Arbitrator or his/her proxy must also submit the original document of his/her
appointment as arbitrator or its authentic copy to the Registrar of District Court.
Registration of arbitration awards is carried out by recording (pencatatan) and signing at
the end of the arbitration awards by the Registrar of the Court and Arbitrator or their
proxies, and the record is a registration deed.

21. Registration of Domestic Arbitration Awards
Article 6 paragraph (3) to Article 6 paragraph (6) of SC Regulation No. 3/2023:
• Registration of arbitration awards can be done electronically via Court Information
System (SIP)
• Registration of arbitration awards is carried out by the Court Registrar no later than 3
(three) days after receipt of the Domestic Arbitration Award/Domestic Sharia
Arbitration Award.
• In the event that the Arbitrator is an Arbitrator appointed by the Arbitration
Institution/Sharia Arbitration Institution, the registration of the Domestic Arbitration
Award/Domestic Sharia Arbitration Award is carried out by the management of the
Arbitration Institution/Sharia Arbitration Institution or their proxy.
• Registration of domestic Arbitration Award/Domestic Sharia Arbitration Award must
be accompanied by documents proving the delivery of notification of the decision
(dokumen bukti penyampaian pemberitahuan putusan) to the parties.

22. Registration of Foreign/International Arbitration Awards
Article 65 of Arbitration Law and Article 7 paragraph (1) of SC Regulation No.
3/2023:
The International Arbitration Award is submitted and registered by the Arbitrator or his
proxy to the Registrar of the Central Jakarta District Court. The International Sharia
Arbitration Award is submitted and registered by the Arbitrator or his proxy to the
Registrar of the Central Jakarta Religious Court (Article 7 paragraph (2) of SC
Regulation No. 3/2023).

23. Registration of Foreign/International Arbitration Awards
Article 67 paragraph (2) of Arbitration Law and Article 7 paragraph (3) of Arbitration Law:
International Arbitration Awards/International Sharia Arbitration Awards is registered accompanied
by:
1. original document or authentic copy of the International Arbitration Award, in accordance with
provisions relating to the authentication of foreign documents, and the official translation
document in Indonesian language;
2. original document or authentic copy of the agreement which became the basis of the
International Arbitration Award in accordance with provisions relating to the authentication of
foreign documents, and the official translation document in Indonesian language; and
3. statement from the diplomatic representatives of the Republic of Indonesia in the country of
origin where the International Arbitration Award was rendered, which states that the claimant’s
country is bound with an agreement, either bilaterally or multilaterally, with the Republic of
Indonesia on recognition and enforcement of International Arbitration Award.

24. Registration of Foreign/International Arbitration Awards
Article 7 of SC Regulation No. 3/2023:
• Registration of International Arbitration Award is carried out by the Court Registrar
no later than 14 (fourteen) days after the registration documents are complete.
• Registration of arbitration awards can be done electronically via Court Information
System (SIP)
• In the event that the Arbitrator is an Arbitrator appointed by the Arbitration
Institution/Sharia Arbitration Institution, the registration of the International
Arbitration Award/International Sharia Arbitration Award is carried out by the
management of the Arbitration Institution/Sharia Arbitration Institution or their proxy.
• The provisions regarding the registration period for Domestic Arbitration Awards (30
days) do not apply to the registration of International Arbitration Awards.

25. Enforcement of
Arbitration Awards

26. Enforcement of Domestic Arbitration Awards
Article 8 of SC Regulation No. 3/2023:
In the event that the chairman of the Court is of the opinion that the National Arbitration
Award/National Sharia Arbitration Decision is contrary to morality and/or Public Order
and does not comply with the provisions of Article 4 and Article 5 of Arbitration Law,
the chairman of the Court rejects the request for implementation arbitration award
through stipulation (penetapan).
In the event that the parties do not implement the National Arbitration Award/National
Sharia Arbitration Award voluntarily, the Arbitration award that has been registered is
implemented based on the order of the chairman of the Court at the request of one of the
parties to the dispute. Orders are given to the parties no later than 30 (thirty) days after
exequatur request of the awards is registered with the Court.

27. Enforcement of Domestic Arbitration Awards
Article 62 of Arbitration Law:
In the event that arbitration award does not fulfill the provisions of Article 4 and Article
5 of Arbitration Law and/or contrary to decency and/or public order, the Chairman of
District Court shall reject the exequatur request and toward such decision which is
rendered by the Chairman of District Court, no legal remedy is available.
Article 12 of SC Regulation No. 3/2023:
The stipulation rejection of exequatur request is final and there is no legal remedy.

28. Enforcement of Domestic Arbitration Awards
Article 15 of SC Regulation No. 3/2023:
In the event that there is a request for annulment of the National Arbitration
Award/National Sharia Arbitration Award and an exequatur request of the National
Arbitration Award/National Sharia Arbitration Award that is submitted at the same time,
the chairman of the Court must postpone the enforcement of arbitration awards, until the
issuance of a first instance decision on the request for annulment of the Arbitration
award stating that it is rejected or inadmissible.

29. Enforcement of Foreign/International Arbitration Awards
Article 16 of SC Regulation No. 3/2023:
In the event that the parties do not implement the International Arbitration
Award/International Sharia Arbitration Award voluntarily, one of the parties submits a
request to the Chairman of the Central Jakarta District Court/Chairman of the Central
Jakarta Religious Court to obtain an exequatur. Request can be made electronically via
SIP.
The Chairman of the Central Jakarta District Court/Chairman of the Central Jakarta
Religious Court no later than 14 (fourteen) days after the request for exequatur is
registered, examines and decides to reject or grant the request for exequatur by assessing
and being guided by the provisions of Article 66 of Arbitration Law.

30. Enforcement of Foreign/International Arbitration Awards
In the event that the Chairman of the Central Jakarta District Court/Chairman of the
Central Jakarta Religious Court grants the exequatur request, the Chairman of the
Central Jakarta District Court/Chairman of the Central Jakarta Religious Court writes the
exequatur on the original document and an authentic copy of the International
Arbitration Award/International Sharia Arbitration Award.
There is no legal remedy that can be taken against the decision of the chairman of the
Central Jakarta District Court which granted the exequatur request. (Article 68 of
Arbitration Law and Article 20 SC Regulation No. 3/2023).

31. Enforcement of Foreign/International Arbitration Awards
Article 17 of SC Regulation No. 3/2023:
In the event that the chairman of the Court is of the opinion that the International
Arbitration Award/International Sharia Arbitration Award is not within the Scope of
Trade and/or is contrary to Public Order, the chairman of the Court rejects the exequatur
request through a decision.
A decision granting or rejecting a request for exequatur is given no later than 30 (thirty)
days after the request for exequatur is registered with the Court.

32. Enforcement of Foreign/International Arbitration Awards
In the event that the Chairman of the Central Jakarta District Court/Chairman of the
Central Jakarta Religious Court rejects to recognize and enforce an International
Arbitration Award/International Sharia Arbitration Award, a cassation can be
submitted. (Article 21 of SC Regulation No. 3/2023 and Article 68 paragraph (2) of
Arbitration Law).
Supreme Court shall consider and judge any submitted cassations no later than 90
(ninety) days after the cassation request has been received by the Supreme Court. Upon
the Supreme Court’s judgment as referred to under Article 66 letter e, objection cannot
be filed. Article 68 paragraph (3) and (4) of Arbitration Law).

33. Enforcement of Foreign/International Arbitration Awards
Enforcement of International Arbitration Awards/International Sharia Arbitration Awards
is carried out in accordance with the procedures of enforcement of civil decisions.

34. Public Order under SC Regulation No. 3/2023
Article 1 point 9 of SC Regulation No. 3/2023:
anything which constitutes the foundations required for the implementation of the legal,
economic and socio-cultural system of the Indonesian society and nation. (segala
sesuatu yang merupakan sendi-sendi asasi yang diperlukan demi berjalannya sistem
hukum, sistem ekonomi dan sistem sosial budaya masyarakat dan bangsa Indonesia).
SC Regulation No. 1/1990
Exequatur will not be granted if the Foreign Arbitration award is contrary to the basic
principles of the entire legal system and society in Indonesia (Public Order).

35. Annulment of
Arbitration Awards

36. Annulment of Arbitration Awards
Article 70 of Arbitration Law and Article 24 of SC Regulation No. 3/2023:
Upon the arbitral award, both parties may submit an annulment request if such award is
alleged to contain the following elements:
a) letter or document which was submitted in the proceeding, after the award has been
rendered, is admitted to be false or declared as false (palsu);
b) after the award has been rendered, it is found that there is a decisive document which
was buried by the opposing party; or
c) the award is rendered based on fraud which was done with one of the parties who is
related with the proceeding.

37. Annulment of Arbitration Awards – Registration
Article 71 and Article 72 of Arbitration Law and Article 24 of SC Regulation No.
3/2023:
Request for annulment of Arbitration Awards must be submitted in writing, no later than
30 (thirty) days from the day of submission and registration of the Arbitration award
to the Court Registrar. Request submitted beyond the deadline, is declared not to meet
the formal requirement.
Requests for annulment is notified to the parties to the dispute no later than 3 (three)
days after registration of annulment request.

38. Annulment of Arbitration Awards - Examination
Article 25 of SC Regulation No. 3/2023:
The annulment of the arbitration award is submitted to the district court in the form of an
request (permohonan).
The Chairman of Court appoints a panel of judges to examine the annulment request.
On the request for annulment of the Sharia Arbitration / Arbitration Awards, the
Respondent can submit a response.

39. Annulment of Arbitration Awards - Examination
Article 26 of SC Regulation No. 3/2023:
Decision on request for annulment of Arbitration Awards shall be announced no later
than 30 (thirty) days after reading the request (pembacaan permohonan).
The stages of the examination of the request for annulment of the Arbitration/Sharia
Arbitration Awards consist of
1. first trial for reading the request;
2. second trial for responses;
3. interlocutory decision (if any)
4. trial with evidentiary proceedings;
5. Decision reading .

40. Annulment of Arbitration Awards - Examination
In the event that the Applicant, after being summoned legally and properly, does not
appear on the day of the first hearing without valid reason, the application is declared
invalid (dinyatakan gugur).
In the event that the Respondent, after being summoned legally and properly, does not
appear without a valid reason at the first hearing, the hearing will continue with the
agenda reading of the Applicant’s requests.

41. Annulment of Arbitration Awards – Legal Remedy
An appeal to the Supreme Court is submitted in writing no later than 14 (fourteen) days
after the decision is pronounced or notified to the parties. The appeal request is received
and recorded in the register book and must be submitted along with memory of appeal.
Article 27 of SC Regulation No. 3/2023:
Appeal can be submitted to the Supreme Court which decides at the first and final level
against the Court's decision which granting the request for annulment of the Arbitration
Awards. There is no legal remedy against court’s decision which rejecting the request for
annulment of the Arbitration Awards.

42. Annulment of Arbitration Awards – Legal Remedy
No later than 7 (seven) days from the date of notification to the Appellee, the Appellee
can submit a Counter Memory of Appeal.
No later than 3 (three) days after the appeal request is recorded, the Court shall notify the
appeal request to the Appellee.
The appeal file is sent to the Supreme Court no later than 25 (twenty five) days after the
appeal request is registered.

43. Annulment of Arbitration Awards – Legal Remedy
The Supreme Court's decision is final and there is no legal remedy.
The Supreme Court considers and decides the appeal request no later than 30 (thirty)
days after the appeal request is registered by the Supreme Court.

44. Annulment of Arbitration Awards – Legal Remedy
The Supreme Court's decision is final and there is no legal remedy.
The Supreme Court considers and decides the appeal request no later than 30 (thirty)
days after the appeal request is registered by the Supreme Court.

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