News & Legal Update

From: A.M Oktarina Counsellors at Law Contributors: Pramudya Yudhatama, S.H., Khaifa Muna Noer Uh’Dina, S.H., Raysha Alfira, S.H., Putri Shaquila, S.H. Reviewer: Noverizky Tri Putra Pasaribu, S.H., L.L.M (Adv)., Abdurrahim, S.H.   A.    Background After the Covid-19 pandemic, people prefer to shop online through e-commerce. Shopping online is seen as more effective because there is no need to come to the store in person and the goods will be delivered to the buyer’s home. Electronic Commerce or e-commerce is all buying and selling activities or transactions carried out using       electronic media facilities that generally use the internet (as the link attached). But recently the social media universe is being enlivened by the prohibition of selling goods through TikTok Shop by the Government. TikTok Shop is a social-commerce platform, which is a combination of social media and e-commerce. Basically, when entering Indonesia, TikTok’s licensing is only for social media platforms and not for online trading platforms. The incessant sales on TikTok Shop have a huge impact on offline MSME sales which are declining, but of course it is also very helpful for many MSMEs who sell online. The government considers that social media platforms and buying and selling e-commerce should be separated. So how is the separation of permissions between social-commerce and e-commerce?   B.    Legal Basis Law Number 5 of 1999 concerning the Prohibition of Monopoly Practices and Unfair Business Competition. (“Law 5/1999“) Law Number 8 of 1999 concerning Consumer (“Law 8/1999“) Law Number 11 of 2008 concerning Electronic Information and Transactions. (“Law 11/2008“) Law Number 7 of 2014 concerning (“Law 7/2014“) Government Regulation Number 80 of 2019 concerning Trading Through Electronic Systems. (“PP 80/2019“) Regulation of the Minister of Trade of the Republic of Indonesia Number 31 of 2023 concerning Business Licensing, Advertising, Coaching, and Supervision of Business Actors in Trading Through Electronic Systems. (“Minister of Trade Regulation 31/2023“).   The definition of Social-Commerce is regulated in Article 1 number 17 of Minister of Trade Regulation 31/2023 which reads: “Social-Commerce is a social media provider that provides certain features, menus, and/or facilities that allow Merchants to post offers for Goods and/or Services.”       By definition, electronic commerce itself refers to Article 1 number 24 of Law 7/2014 which regulates as follows: “Trading through Electronic Systems is Trading whose transactions are carried out through a series of electronic devices and procedures.”   Article 4 letter b of Law 11/2008 also explains the principles and objectives of electronic transactions as follows: “The utilization of Information Technology and Electronic Transactions is carried out with the aim to: develop trade and national economy in order to improve public welfare”     Furthermore, Law 7/2014 explains about trading through electronic systems as regulated in Article 65 of Law 7/2014: “(1) Every Business Actor who trades Goods and/or Services using an electronic system must provide complete and correct data and/or information. Every Business Actor is prohibited from trading Goods and/or Services using an electronic system that is not in accordance with the data and/or information as referred to in paragraph (1). The use of electronic systems as referred to in paragraph (1) must comply with the provisions stipulated in the Electronic Information and Transaction Law. Data and/or information as referred to in Subsection (1) shall at least contain: identity and legality of Business Actors as producers or Distribution Business Actors; technical requirements of the Goods offered; technical requirements or qualifications of the Services offered; prices and payment methods for Goods and/or Services; and how to deliver the In the event of a dispute related to a trade transaction through an electronic system, the person or business entity experiencing the dispute may resolve the dispute through the court or through other dispute resolution mechanisms.       Every Business Actor who trades Goods and/or Services using an electronic system that does not provide complete and correct data and/or information as referred to in paragraph (1) shall be subject to administrative sanctions in the form of license “   As for the implementation of trade through electronic systems, one of them is regulated in Article 15 PP 80/2019 , namely: “(1) Business actors must have a business license in conducting PMSE business activities. The Intermediary Facility Operator is exempted from the obligation to have a business license as referred to in paragraph (1) if: is not a beneficiary directly from the transaction; or not be directly involved in the contractual relationship of the parties conducting In order to make it easier for Business Actors to obtain a business license as referred to in paragraph (1), the application for a business license shall be carried out through an Electronic Integrated Business License in accordance with the provisions of laws and regulations.”   Basically, the one of the problem in this case is that offline MSMEs such as those in Tanah Abang feel disadvantaged not because of the emergence of TikTok Shop, but because imported goods sold on TikTok Shop are considered much cheaper than prices in the market so that they succeed in attracting consumer buying interest. Stores on TikTok Shop will provide low prices at the beginning of their appearance to attract consumers, even allowing them to sell at a loss. The Minister of Trade, Mr. Zulkifli Hasan, explained that the significant price difference between offline stores and online stores is called predatory pricing which can damage market prices causing other traders to lose competitiveness (as the link attached). According to Article 20 of Law 5/1999 this is a market control that is prohibited by the following rules:       “Business actors are prohibited from supplying goods and or services by selling at a loss or setting very low prices with the intention of eliminating or shutting down the business of their competitors in the relevant market so that it can result in monopolistic practices and / or unfair business competition.” So that Article 13 Minister of Trade Regulation 31/2023 has regulated the following provisions: “(1). In carrying out PMSE

From: A.M Oktarina Counsellors at Law Contributors: Ricki Rahmad Aulia Nasution, S.H., Pramudya Yudhatama, S.H., Khaifa Muna Noer Uh’Dina, S.H., Raysha Alfira, S.H., Putri Shaquila, S.H. Reviewer: Noverizky Tri Putra Pasaribu, S.H., L.L.M (Adv).   Background   Marriage of different religions and beliefs in our country is certainly not new. This has become a practice that we often encounter in society for a long time. Of course, this reaps pros and cons from various walks of life. Various opinions and assumptions arise regarding marriage of different religions and beliefs, so how do Indonesian regulations respond to it? This needs to be reviewed both in terms of history and positive legal history that governs it.   Legal Basis Constitution of the Republic of Indonesia Year 1945. (“1945 Constitution“) Law Number 1 of 1974 concerning Marriage. (“Law No. 1/1974“) Law Number 23 of 2006 concerning Population Administration. (“Law No. 23/2006“) Regeling op de Gemengde Huwelijken. (“GHR“) Compilation of Islamic Law. (“KHI“) Supreme Court Circular Number 2 of 2023 concerning Guidelines for Judges in Adjudicating Cases of Petition for Registration of Marriages Between People of Different Religions and Beliefs. (“SEMA No. 2/2023“)   In this dynamic of marriage of different religions and beliefs, we need to research and look at the history of regulation. Long before the issuance of Law No. 1/1974, marriages of different religions and beliefs had been regulated in Regeling op de Gemengde Huwelijken Koninklijk Besluit van 29 December 1896 No.23, Staatblad 1898 No. 158, issued by the Dutch Colonial Government. In GHR, it is explained about the Mixed Marriage Regulation with one of them referring to Article 7 paragraph (2) of GHR that reads:   “Differences in religion, class, population or origin cannot be an obstacle to marriage.”   Over time, the Indonesian government as a regulator enacted Law No. 1/1974, so with this, the provisions in the GHR were revoked and no longer valid as positive law in Indonesia. (as the link attached)   So what is the definition of marriage itself today? We may refer to Article 1 of Law No. 1/1974 that reads: “Marriage is the inner bond between a man and a woman as husband and wife with the aim of forming a happy and eternal family (household) based on the Supreme God.”   Furthermore, Article 2 paragraph (1) of Law No. 1/1974 stipulates as follows:   “(1) Marriage is valid, if it is performed according to the laws of each religion and belief.”   Regarding the prohibition of marriage, it may refer to Article 8 letter f of Law No. 1/1974 that reads:   “Marriage is prohibited between two persons who:   have a relationship that, by religion or other applicable regulations, is prohibited from marrying.“   Judging from the article above, Law No. 1/1974 has regulated the provisions for valid marriage, namely when it is in accordance with the laws of each religion and belief held by the prospective husband and wife, and also prohibits marriage that has been prohibited by their religion. Article 28B paragraph (1) of the 1945 Constitution also explains as follows:   “(1) Everyone has the right to form a family and continue offspring through legal marriage.”   The diction “through legal marriage” means that a person has the right to have a family provided that the marriage is valid in the eyes of the law and religion.   In Indonesia’s positive law, there is no regulation that specifically regulates the prohibition of marriage of different religions and beliefs, so it may be said that there is still a legal vacuum and uncertainty. Regulation is only limited to returning these provisions to the religious law of each individual.   Let us take an example in the religion of Islam. In Islam, marriage of different religions and beliefs is not allowed and the law is haram, where if a Muslim marries a partner of different religions and beliefs, then the marriage is considered invalid in the eyes of the religion and also automatically in the eyes of the law, because the law returns the provision to the rules of their respective religions. Regarding the prohibition of marriage of different religions and beliefs in Islam has also been regulated in Article 40 letter c and Article 44 KHI that reads:   Article 40 letter c of the KHI: “It is forbidden to enter into a marriage between a man and a woman due to certain circumstances:   a woman who is not Muslim.”   Article 44 of the KHI: “A Muslim woman is forbidden to marry a man who is not Muslim.”   Then today, there is a dynamic in practice, namely in 2022, there is a court decision from the Surabaya District Court that grants marriage petition of different religions and beliefs between Muslim men and Christian women. Previously, the Surabaya District Court had also granted 17 (seventeen) marriage petition for different religions and beliefs (as the link attached).   In addition, the South Jakarta District Court also granted the petition for marriage of different religions and beliefs between Muslim and Catholic couples as registered in Case No. 53/Pdt.P/2023/PN Jkt.Sel, and granted permission for the petitioner to register his marriage at the Department of Population and Civil Registration (“Dukcapil“) of the South Jakarta Administration City (as the link attached). This then raises pros and cons in society.   However, over time, the Head of the Supreme Court has issued SEMA No. 2/2023 that regulates guidelines for judges in adjudicating the registration of marriage petition of different religions and beliefs that regulates as follows:   “To provide certainty and unity in the application of the law in adjudicating petition for registration of marriages between people of different religions and beliefs, judges must be guided by the following provisions:   A valid marriage is a marriage carried out according to the laws of each religion and belief, in accordance with Article 2 paragraph (1) and Article 8 letter f of Law Number 1 of 1974 concerning Marriage.   The court does

BREAKING GROUND IN ARBITRATION: AM OKTARINA’S KEY ROLE IN FCC CASE AA4718 Contributor: Ricko Anas Extrada, S.H. Muhammad Ardin Ardiansyah, S.H. Reviewer: Noverizky Tri Putra Pasaribu, S.H., L.LM. (Adv). Aflah Abdurrahim, S.H. Image Sources: https://pin.it/2O3fZnoeI A. Background AM Oktarina Counsellors At Law Secures Significant Victory in International Arbitration under the Federation of Cocoa Commerce (FCC) in London Kemang Point, 3rd floor, Unit 3-02 Jl. Kemang Raya No. 03, South Jakarta. Jakarta 12720 Phone: 021-22716290 www.amoktarina.net 2 AM Oktarina Counsellors At Law has successfully secured a significant victory in an international arbitration dispute under the Federation of Cocoa Commerce (FCC) in London. The case, identified as AA4718, revolved around the interpretation of contractual clauses related to the choice of arbitration forum, the fulfillment of contractual obligations, and arbitration jurisdiction under international legal principles. In this matter, AM Oktarina represented its client, an Indonesian company, against claims brought by the buyer (claimant) in an international cocoa trade transaction. This achievement not only highlights AM Oktarina’s legal expertise but also reinforces legal certainty in resolving disputes through international arbitration mechanisms. The dispute arose from an international cocoa sale transaction where the parties agreed to refer disputes to FCC arbitration, as stated in the contract clause: “The parties agreed that any issues to be resolved, arising out of the contract, will be referred to Arbitration under the prevailing rules of the Federation of Cocoa Commerce Limited, London.” The claimant alleged that the respondent (AM Oktarina’s client) had breached the contract; however, the claim was filed without adhering to the FCC’s procedural rules, such as the requirement to provide a formal written notice declaring the respondent in default. Through comprehensive legal arguments, AM Oktarina successfully persuaded the arbitration tribunal that the claimant’s claims were legally unfounded and violated the formal procedures stipulated in the FCC Arbitration and Appeal Rules. Consequently, the tribunal ruled in favor of the respondent, declaring that no breach of contract had occurred and releasing the respondent from all claims. Summary of Case AA4718 Chronology at the FCC 1. Contract Formation: Kemang Point, 3rd floor, Unit 3-02 Jl. Kemang Raya No. 03, South Jakarta. Jakarta 12720 Phone: 021-22716290 www.amoktarina.net 3 On January 27, 2023, the claimant (Kamala Consumer Care PVT Ltd.) and the respondent (PT Surya Kakao Internasional) signed a purchase agreement for 160 MT of Natural Cocoa Butter at USD 3,700 per MT, totaling USD 592,000. The agreed delivery schedule was from March to August 31, 2023 (FOB Jakarta). Payment terms included a 30% deposit and 70% upon scanning the shipping documents. 2. Delivery Schedule Breach: Out of the eight scheduled shipments, only three were completed before the deadline (August 31, 2023). The fourth shipment was made on September 10, 2023, exceeding the agreed timeline. 3. Contract Termination: On April 24, 2024, the respondent declared its inability to continue the contract due to a sharp increase in raw material prices (cocoa beans). The respondent claimed that the price of Grade “A” Natural Cocoa Butter had soared to USD 40,000 per MT, far above the initial contract price. 4. Arbitration Claim Submission: On June 29, 2024, the claimant submitted an arbitration claim to the FCC, accusing the respondent of failing to deliver the remaining 80 MT and seeking damages for financial and reputational losses. 5. Respondent’s Defense: Represented by AM Oktarina Counsellors At Law, the respondent argued that the claimant’s submission exceeded the 56-day deadline as stipulated by the FCC Arbitration Rules. The respondent also rejected the claimant’s demand for USD 2,904,000 in damages, citing unrealistic and inaccurate calculations. 6. Arbitration Proceedings: Kemang Point, 3rd floor, Unit 3-02 Jl. Kemang Raya No. 03, South Jakarta. Jakarta 12720 Phone: 021-22716290 www.amoktarina.net 4 The FCC Tribunal reviewed submissions and arguments from both parties. It concluded that the claimant had failed to formally declare the respondent in default in compliance with FCC Rules. 7. Final Decision: The tribunal ruled that while the respondent wrongfully terminated the contract on April 24, 2024, the claimant had also failed to meet procedural obligations. The tribunal ordered the contract to remain enforceable for the remaining deliveries but split the arbitration costs evenly, with each party bearing their legal expenses. This case exemplifies the importance of adhering to procedural rules in arbitration and underscores AM Oktarina Counsellors At Law’s ability to navigate complex international legal disputes effectively. Legal Basis 1. FCC Arbitration and Appeal Rules (Applicable to contracts concluded on or after 0 July 2021) [“FCC Arbitration and Appeal Rules”] 2. Contract Rules for Cocoa Beans (Applicable to contracts concluded on or after 01 March 2023) [“CP4 Rules”) 3. Arbitration Act 1996 Disputing parties in international transactions generally predetermine the forum and/or applicable law to be used when disputes arise. Determining such formalities is critical since the parties often come from different countries with distinct legal systems. Therefore, choice of forum and choice of law are essential for contracting parties when determining which international arbitration forum will be used to resolve future disputes. Kemang Point, 3rd floor, Unit 3-02 Jl. Kemang Raya No. 03, South Jakarta. Jakarta 12720 Phone: 021-22716290 www.amoktarina.net 5 When parties have predetermined their preferred international arbitration forum for resolving disputes, they must clearly and explicitly state this choice in a written agreement prior to any dispute. This ensures legal certainty for the contracting parties and provides the arbitral tribunal with the necessary legal standing or authority to adjudicate the dispute. In the case experienced by our client, the arbitration was conducted under FCC Arbitration, where the parties had explicitly stated in their contract: “The parties agreed that any issues to be resolved, arising out of the contract, will be referred to Arbitration under the prevailing rules of the Federation of Cocoa Commerce Limited, London.” Additionally, both parties must agree and declare that they are aware of, familiar with, and willing to comply with the agreement incorporating the FCC Arbitration Rules. In other words, one party must not exploit a dominant position to the detriment of the other party’s understanding of the FCC Arbitration or other