ENTRUST YOUR OUTSTANDING RECEIVABLES IN INDONESIA TO INVENIUM
In Indonesia there is no source of reliable information on Companies. Only a handful have the obligation of filing their financial statements.
Average payment terms in Indonesia in recent years have deteriorated but nevertheless, medium to large-sized companies tend to pay on time to preserve their reputation. In contrast, small enterprises in Indonesia still tend to frequently delay payments.
Indonesia has a mixed legal system: civil law together with religious principles and local customs. The legal system is not very transparent and is characterised by a high level of corruption. Commercial Courts decide on insolvency disputes.
Legal action in Indonesia is quite lengthy and expensive and decisions can often be inconsistent. There is an ideological principle (Pancasila) and a requirement laid down by the Supreme Court in 2008, which obliges the parties to reach a mediation agreement before taking any legal action.
In any case, legal action is not recommended below $500,000.
Legal action can be initiated only after mediation has failed. A letter of formal notice is first sent which is followed by a claim before the District Court.
The Civil Code – for late payments – regulates both the application of a conventional interest rate (Bunga Konversional) as well as an arrears interest rate (Bunga Moratoir) equal to 6% per annum.