Mediation is one of many alternative methods of dispute resolution and offers a number of advantages over litigation. It prioritizes the quest for win-win solution and takes less time than a trial, while at the same time offering room for disputing parties to maintain relationships and avoid excessive publicity.
 
For the past eight years, the mediation process has been regulated under Supreme Court Regulation No. 1 of 2008 (“2008 Regulation”). However, despite its various merits, the whole mediation process in Indonesia is generally viewed as being just another formality that must be dispensed with before actual court proceedings can get underway. Based on the results of research conducted by the Indonesian Institute for Conflict Transformation (IICT), mediation success rates at courts of first instance here only amount to around 4% of the total number of cases filed.
 
In order to address this low mediation success rate, specifically those processes which are organized by the courts, the Supreme Court recently issued Supreme Regulation No. 1 of 2016 (“2016 Regulation”) on the Mediation Procedure. The 2016 Regulation has been designed to boost the mediation success rate, so that this process will be seen as a viable alternative for the resolution of disputes.
 
The 2016 Regulation encompasses three substantial changes, which relate to shorter mediation times, the obligation to attend the mediation process in person, and the incorporation of the good-faith principle.
 
Accordingly, this week’s Indonesian Law Digest (ILD) will analyze and discuss issues relating to the new mediation process, which are set out under the 2016 Regulation. The analysis will confine itself to the following topics: