Business players support mediating institution
Business players support mediating institution
Fitri Wulandari, The Jakarta Post, Jakarta
Business players say the establishment of an independent
mediation center could provide an alternative means of settlement
for commercial disputes amid the country's murky legal system.
"We supports this kind of mediating institution. In principle,
Pertamina prefers to settle commercial disputes through
mediation," Simson Panjaitan, a legal counsel for state oil and
gas company Pertamina told The Jakarta Post on Friday.
Simson said compared to litigation and arbitration, settling
commercial dispute through mediation had more advantages.
"It's fast, less expensive and reliable. In litigation or
arbitration, there is always a loser and a winner. Mediation
provides a win-win solution that satisfies both parties," he
said.
Although a bit skeptical about the center's future, chairman
of the Indonesian Employers Association (Apindo) Sofjan Wanandi
said the center could help businessmen who were apprehensive
about the country's judicial system.
"Well ... let's give it a try. Why not have a mediation
center. Then, we won't have to go to court," he said.
Simson and Sofjan were both commenting on the establishment of
the National Mediation Center (PMN), an independent institution
that is to provide mediation services to businessmen to settle
commercial disputes.
In a press conference on Thursday, PMN executives said the
agency was equipped with professional mediators from former
judges of the supreme court, law practitioners to respected
individuals. Most of them were formerly mediators with the
Jakarta Initiative Task Force (JITF).
Simson said to make PMN successful, it should be backed up by
experts who can make the institution a reliable mediator.
"The mediators should be reliable, capable and understand the
cases. They have to be able to maintain the mediation process so
that it comes out with satisfying results," he said.
Sofjan, however, is skeptical that such a mediation center
could be successful. Particularly, as mediation does not seem so
popular among Indonesian businessmen.
"It may work for foreign businesses. But for local
businessmen, some of them prefer to turn to close colleagues who
know the disputed parties to help mediate their disputes," Sofjan
said.
"Besides, it depends on the goodwill of the disputing parties.
So, it may not be successful," he added.
Sofjan further added, it may work for small cases but not big
cases such as ones involving huge debts.
"Usually, they prefer to go to court or even hire thugs to
force creditors to pay their debt," he said.
Meanwhile, Simson said Pertamina was now looking at settling
its prolonged dispute with independent power producer Karaha
Bodas Company (KBC) through mediation.
The dispute started when former president Soeharto suspended
27 power projects owned by independent power producers, including
KBC in 1998 as part of an agreement with the International
Monetary Fund (IMF).
Following the suspension, KBC filed a lawsuit against
Pertamina, seeking a staggering US$261 million in compensation.
Since then Pertamina has been mired in a protracted court
dispute with KBC.
I-box:
How will the NMC work?
1. Pre-mediation
- One of the disputing parties registers with the NMC
- The party then appoints a mediator from the NMC roster
- The mediator will conduct a meeting with all parties to explain
the role of mediators, procedures and cost.
2. Negotiation
- The mediator meets with each party in separate meetings to
gather initial information
- Mediators and disputed parties meet to define their problems,
interests, and needs.
- Mediators assist parties to develop their own solution to the
problem
- They negotiate an agreement based on alternative solutions
proposed by the mediator
3. Final stage
- Once they reach a consensus, they will sign a memorandum of
understanding that binds all parties.
- In a case where parties cannot reach an agreement, they then
submit a resignation letter explaining the reasons for abandoning
the process.