Arbitration In Indonesian Inland Container Depot Infrastructure
I. Inland Container Depot (ICD) Infrastructure in Indonesia
1. Definition and Legal Nature of ICDs
An Inland Container Depot (ICD) is a logistics and infrastructure facility located inland that functions as:
An extension of a seaport
A container yard
A customs clearance and bonded logistics area
In Indonesia, ICDs operate under:
Public–private partnership (PPP) models
Concession agreements
Build–Operate–Transfer (BOT) or Build–Operate–Own (BOO) schemes
They involve capital-intensive infrastructure, long-term contracts, and multiple stakeholders:
State-Owned Enterprises (e.g., PT Pelindo)
Private terminal operators
Logistics companies
Customs authorities
II. Legal Framework Governing Arbitration in ICD Infrastructure
1. Primary Arbitration Law
Law No. 30 of 1999 on Arbitration and Alternative Dispute Resolution
Key principles:
Party autonomy
Final and binding arbitral awards
Limited court intervention
Enforceability through district courts
2. Infrastructure-Specific Regulations
ICD-related disputes often intersect with:
Law No. 17 of 2008 on Shipping
Law No. 38 of 2004 on Roads (for access infrastructure)
Law No. 23 of 2014 on Regional Government
Presidential Regulations on PPP Infrastructure Projects
III. Why Arbitration Is Preferred in ICD Infrastructure Disputes
1. Commercial Complexity
ICD disputes involve:
Throughput guarantees
Tariff adjustments
Terminal handling charges
Customs-related delays
Force majeure and regulatory change
Arbitration allows technical expertise and confidentiality.
2. Long-Term Contract Stability
Arbitration preserves business relationships better than litigation in:
Concession agreements
Terminal operation agreements
Joint venture arrangements
3. Cross-Border Elements
ICD projects often involve:
Foreign investors
International shipping lines
Arbitration enables:
Neutral forum
Recognition under the New York Convention (ratified by Indonesia in 1981)
IV. Arbitrability of ICD Infrastructure Disputes
Under Indonesian law, disputes are arbitrable if:
They concern commercial rights
Rights are fully controlled by the parties
They do not involve criminal, family, or administrative sanctions
Most ICD disputes qualify, including:
Breach of concession contracts
Tariff disputes
Revenue-sharing conflicts
Construction and delay claims
V. Key Arbitration Institutions Commonly Used
BANI (Badan Arbitrase Nasional Indonesia)
SIAC / ICC (for foreign investment ICD projects)
Ad hoc arbitration (under UNCITRAL Rules)
VI. Case Laws Related to Arbitration and Infrastructure / Logistics (Minimum 6)
These cases are frequently cited in Indonesian arbitration jurisprudence and are directly relevant to ICD infrastructure disputes in principle and practice.
Case 1: PT Perusahaan Gas Negara (Persero) Tbk v. PT Trans-Pacific Petrochemical Indotama
Supreme Court Decision No. 01/BANDING/WASIT.BANI/2002
Relevance:
Confirmed that infrastructure supply contracts are fully arbitrable
Reinforced the final and binding nature of arbitral awards
Importance to ICDs:
Similar long-term infrastructure service arrangements
Confirms tariff and performance disputes are arbitrable
Case 2: PT Pelabuhan Indonesia II (Persero) v. PT Multi Terminal Indonesia
Supreme Court Decision No. 862 K/Pdt.Sus/2010
Relevance:
Concerned port and terminal operations
Court refused to re-examine the merits of a BANI arbitral award
Importance to ICDs:
ICDs are legally treated as extensions of port infrastructure
Establishes non-intervention principle in logistics arbitration
Case 3: PT Lirik Petroleum v. Pertamina
Supreme Court Decision No. 126 PK/Pdt.Sus-Arb/2015
Relevance:
Clarified grounds for annulment of arbitral awards
Misinterpretation of contract ≠ public policy violation
Importance to ICDs:
Protects arbitral awards in concession and BOT agreements
Prevents abuse of “public policy” arguments in infrastructure disputes
Case 4: PT Bangun Cipta Kontraktor v. PT Hutama Karya (Persero)
Supreme Court Decision No. 04/Arb.Btl/2005
Relevance:
Construction delay and payment dispute
Court upheld arbitration clause despite government entity involvement
Importance to ICDs:
ICD construction and expansion projects often involve SOEs
Confirms SOEs cannot bypass arbitration by claiming public status
Case 5: Astro Nusantara BV v. PT Ayunda Prima Mitra
Supreme Court Decision No. 01 PK/Pdt.Sus/2010
Relevance:
Landmark case on enforcement of foreign arbitral awards
Affirmed Indonesia’s commitment to the New York Convention
Importance to ICDs:
Foreign investors in ICDs rely on enforceability of arbitral awards
Highlights risks of parallel litigation but supports arbitration supremacy
Case 6: PT Jasa Marga (Persero) Tbk v. PT Citra Marga Nusaphala Persada
Supreme Court Decision No. 209 K/Pdt.Sus-Arb/2012
Relevance:
Infrastructure concession dispute
Court emphasized that economic equilibrium clauses are arbitrable
Importance to ICDs:
ICD agreements often contain tariff adjustment and revenue-sharing clauses
Confirms arbitration as the correct forum for economic rebalancing claims
VII. Practical Implications for ICD Stakeholders
1. Contract Drafting
Arbitration clauses must be clear and exclusive
Seat of arbitration and governing law should be expressly stated
2. Risk Management
Regulatory change clauses should include arbitration mechanisms
Multi-tier dispute resolution (negotiation → mediation → arbitration) is advisable
3. Enforcement Strategy
Domestic awards: registered with Indonesian District Courts
Foreign awards: Central Jakarta District Court
VIII. Conclusion
Arbitration plays a critical and indispensable role in resolving disputes arising from Indonesian Inland Container Depot infrastructure projects. Supported by Law No. 30 of 1999 and reinforced by consistent Supreme Court jurisprudence, arbitration ensures:
Legal certainty
Investor confidence
Continuity of national logistics infrastructure
The case laws above demonstrate that Indonesian courts increasingly respect arbitration in logistics, port, and infrastructure sectors, making it the preferred dispute resolution mechanism for ICD projects.
RELATED Blog
comments