The Failure of the Court to Protect Consumers: A Review of Consumer Dispute Resolution in Indonesia
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The Failure of the Court to Protect Consumers: A Review of Consumer Dispute Resolution in Indonesia M. Syamsudin 1 Received: 17 November 2019 / Accepted: 7 September 2020/ # The Author(s) 2020
Abstract
Indonesia needs strong measures to protect its consumers, which leads to the creation of the Consumer Dispute Settlement Agency (BPSK) as an arbiter to settle disputes between consumers and businesses efficiently. The Indonesian Supreme Court (MARI) has set aside an alarming number of BPSK arbitral awards, putting the entire system in jeopardy. The aims of this study are to examine the empirical data on MARI’s decisions in setting aside arbitral awards and analyse their decision-making process. This research shows how MARI has been interpreting the statue promulgating the BPSK very narrowly. The result of MARI’s interpretation of the law has deep implications for consumer protection in Indonesia, namely that the public trust in the enforcement of Consumer Protection Law by BPSK has been severely diminishing, leaving consumers without meaningful access to justice or protection of their rights. Keywords Arbitration decision . Consumer dispute resolution . Consumer protection The motivation for this research comes from the large number of arbitral awards at the Consumer Dispute Settlement Agency, which the Indonesian Supreme Court has set aside. At the end of October 2017, there were around 127 arbitral awards involving consumers handed down by the Agency and which were, in turn, set aside by the Supreme Court (Andi Saputra 2017). The fact that a large number of arbitral awards have been set aside raises various questions, and suspicion, in academic circles relating to the quality of the arbitral awards handed down by the Agency. The goal of this paper is to determine whether the arbitral awards from the Agency have flaws at the classification level, which leads to so many awards being set aside by the Supreme Court.
* M. Syamsudin [email protected]; [email protected]
1
Faculty of Law, Universitas Islam Indonesia (UII), Jl. Tamansiswa No.158, PO Box 1133, Yogyakarta 55151, Indonesia
M. Syamsudin
The Indonesian Supreme Court has overturned a large number of the Agency’s awards, and this will have serious implications for consumer protection in Indonesia. Consumers who seek recourse before the Settlement Agency will seemingly face certain disappointment when the Supreme Court overturns their arbitral awards. Experience to date suggests that this has resulted in losses for those consumers whose grievances have ignored and left them unprotected. This highlights how consumer protection in Indonesia provides a miniscule degree of legal certainty. This is in stark contrast to the notion of consumer protection in Article 1 of Indonesian Law Number 8, 1999 concerning Consumer Protections, which ostensibly ensures “all efforts to ensure legal certainty for consumer protection.” Many problems in relation to the arbitral tribunal’s awards have caused legal uncertainty and injustice in their enforcement of Consumer Protection
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