Reinterpreting the Arbitration Legislation for Online Awards in Indonesia

Abstract

Objective - The use of online arbitration is more convenient for the disputing parties because their submissions can be archived by automated document management systems and be reviewed from any location, at any time. Yet, the process of online arbitration in Indonesia is questionable because the Indonesian Arbitration Legislation does not provide provisions relating to online arbitration. It is also questioned whether online arbitration awards are domestic or international under the Legislation. In order to answer the questions, this research examines and reinterprets the Legislation to establish arguments pertaining to the status of online arbitration and its awards in Indonesia. Methodology/Technique - It adopts a normative legal research by examining the existing legislation and literatures relating to arbitration. Findings - It found that the Legislation permits online arbitration because the IT Legislation facilitates the use of electronic communications and devices for this type of arbitration. Yet, the category of its awards may be vague. This is because Indonesia has not adopted the UNCITRAL Model Law. Consequently, the Legislation merely categorizes the online arbitration awards based on whether they are rendered in Indonesian territory (domestic awards) or outside Indonesia (international awards). Originality/value - The use of technology has penetrated business transactions and may result in legal disputes. Therefore, those who engage in online transactions should consider their dispute resolution mechnism. In the context of online business, it may be beneficial for disputing parties to settle their disputes through online arbitration because it can transcend national boundaries, and its awards may be enforceable. Type of Paper - Review Keywords: Online arbitration, awards, dispute resolution, arbitration law, Indonesia. JEL Classification: K2, K29