Draft Bill on Business Entity Being Drafted to Address Corporate Disputes

The government is still preparing the Draft Bill on Business Entities. The regulation is believed to be capable of resolving issues related to corporate disputes.

"There are many disputes and disagreements among shareholders and management; we want to bring order to that," said Widodo, Director General of General Legal Administration (“Dirjen AHU”) at the Ministry of Law (“Kemenkum”), to Hukumonline.

In addition, the Kemenkum is also strengthening digital transformation to support the regulation of disputes. Currently, they are developing an information technology system to simplify legal administration services. Widodo cited the example of share trading.

“They claim they were just borrowing money, not intending to sell, even though a transaction took place. This is a common source of disputes. In the end, we often end up being dragged into court as co-defendants,” he said.

The Draft Bill on Business Entities is included in the 2026 National Legislation Program ("Prolegnas"). This regulation is being drafted using a codification method that harmonizes several laws, including Law No. 40 of 2007 on Limited Liability Companies, as amended by Regulation of the Government in Lieu of Law No. 2 of 2022 on Job Creation (collectively referred to as "Law 40/2007"), up to Law No. 16 of 2001 on Foundations, as amended by Law No. 28 of 2004 (collectively referred to as "Law 16/2001").