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Translation turmoil
Indonesian Law No 24 of 2009 on its National Flag,
Language, Emblem and Anthem (known as the
"Language Law") still raises eyebrows among global
professionals doing business in Indonesia
Indonesians and foreigners alike. Recent judicial
decisions have revived concerns about the effect of
this law on the enforceability of contracts in Indonesia.
The Language Law seeks to establish Bahasa
Indonesia as the official language of Indonesia, and
includes provisions that official state documents
should primarily be written in the language. The
drafters of the law also included an Article 31, which
provided that contracts with governmental
organisations should also be in the national language.
During the legislative process, Article 31 was extended
by lawmakers to ostensibly cover contracts with
private enterprises. A generous reading of the context
might suggest that this was intended to cover
contracts between private enterprises and Indonesian
governmental bodies. Many government officials
expressed this view and the expectation that
implementing regulations would clarify the impact.
However, industry's worst fears were realised when, in
a 2013 decision1, the West Jakarta District Court held
a loan agreement between an Indonesian company
and a foreign investor unenforceable for failure to
comply with the Language Law. The loan agreement
concerned was drafted in English only, while the deed
of fiduciary security was in Bahasa Indonesia. The
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Further information
If you would like any further information on any of the issues raised in this briefing, please contact:
Rob Palmer
Debby Sulaiman
Key contacts
Singapore
Ben Giaretta
Partner, Ashurst Singapore
Asia Head of International Arbitration
+65 6416 3353
ben.giaretta@ashurst.com
Rob Palmer
Partner, Ashurst Singapore
+65 6416 9504
rob.palmer@ashurst.com
Baldev Bhinder
Senior Associate, Ashurst Singapore
Akshay Kishore
Associate, Ashurst Singapore
Katherine McMenamin
Associate, Ashurst Singapore
Michael Weatherley
Legal Manager, Ashurst Singapore
Angus Ross
Partner, Ashurst Hong Kong
+852 2846 8909
angus.ross@ashurst.com
Noor Meurling
Senior Foreign Legal Consultant,
Oentoeng Suria & Partners, Jakarta
Debby Sulaiman
Partner, Oentoeng Suria & Partners,
Jakarta
Ian Shepherd
Partner, Ashurst Port Moresby
Derek Wood
Partner, Ashurst Port Moresby
Jason Brooks
Partner, Ashurst Port Moresby
Chris Bailey
Partner, Ashurst Tokyo
Tokyo Head of Dispute Resolution
This publication is not intended to be a comprehensive review of all developments in the law and practice, or to cover all aspects of those referred to.
Readers should take legal advice before applying the information contained in this publication to specific issues or transactions. For more information
please contact us at thefirm@oentoengsuria.com or email@ashurst.com
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2015