Foreign Arbitral Award Enforcement in Indonesia: A Legal Certainty and Justice Dilemma

Abstract

Under the treaty widely known as the New York Convention, the recognition and enforcement of arbitral awards made abroad is treated as a matter of international governance, with the Convention firmly favoring enforcement and confining judicial refusal to the narrow grounds listed in Article V. Even so, how far Indonesian courts may exercise judicial oversight over such awards remains an unsettled question. This study examines the rules and practice surrounding the recognition and enforcement of foreign arbitral awards in Indonesia and considers whether Indonesian judicial practice matches the Convention’s requirements. It employs a normative-juridical method built on statutory, conceptual, and case-based analysis of the relevant legal instruments, doctrines, and Indonesian court decisions. The findings show that Indonesian courts have, on a number of occasions, read the refusal grounds more expansively than the Convention allows, pushing judicial intervention past the boundaries Article V sets. This pattern produces inconsistency in how foreign awards are enforced and weakens legal certainty for parties to international commercial transactions. What this study contributes to the arbitration literature is a mapping of the gap between the Convention’s pro-enforcement standards and Indonesian judicial practice, together with a proposed framework for judicial control that is more predictable, Convention-compliant, and reconciles legal certainty with justice.

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