Revision of Bankruptcy Law Simplifies Legal Procedures

The Director-General of Laws and Regulations (Director-General) of the Ministry of Law (Ministry) Dhahana Putra revealed the progress of the update to the Draft Bill on the Amendment to Law No. 37 of 2004 on Bankruptcy Proceedings and the Suspension of Debt Payment Obligations (Penundaan Kewajiban Pembayaran Utang - “PKPU Law”). The prepared amendment is expected to simplify the legal procedures for decisions on the suspension of debt payment obligations for all parties involved.

“It is still being discussed by the Inter-Ministerial Committee (Panitia Antar Kementerian/PAK). However, some of the points follow up on the Constitutional Court’s decision and take into account Hotman Paris’ statement on the substance of bankruptcy, which is considered unfair to debtors,” Dhahana told Hukumonline.

Furthermore, the Ministry is also studying recommendations from the World Bank to accommodate flexibility in certain provisions for resolving bankruptcy disputes, taking into account global and local economic conditions. This aims to improve the investment climate while maintaining a balance between the interests of debtors and creditors.

It is known that the Bankruptcy Draft Bill and PKPU are part of the Medium-Term National Legislation Program (Program Legislasi Nasional/Prolegnas) for 2020-2024, are also included in the Medium-Term Prolegnas for 2025-2029.

“It is targeted to be completed this year,” he concluded.