Member Article

On 28 December 2009 the Indonesian Ministry of Law and Human Rights issued a letter (the “MOLHR Letter”) in which the Ministry clarified that in their view, at least until the implementing regulations have been issued, contracts in the English language only should continue to be valid and not void or voidable and that the implementing regulations for Law No. 24/2009, when issued, will not be retroactive. Although the views set out in the MOLHR Letter would not be binding on a court, it does give some comfort to people contracting with Indonesian entities in the English language only. We would add one caveat that some specific types of contracts (eg franchise agreements, articles of association) must be in the Indonesian language according to applicable laws or regulations. The MOLHR Letter also reinforced the ability of contracting parties to choose the prevailing language in the event of conflict between the different versions. Our Advisory on this topic has been updated accordingly.

 

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