English-Language Contracts Held Void, So Maybe I Won’t Be Going to Indonesia After All

Recently I tentatively agreed to give a public “Drafting Clearer Contracts” seminar in Indonesia next year. But I’m not sure that would make sense currently, given that a Jakarta court has just held that all contracts entered into with an Indonesian public or private entity after 9 July 2009 that are not in Bahasa Indonesia (the Indonesian language) will be in violation of a 2009 law and so will be void. For more about that, see this newsletter from Herbert Smith Freehills, on Lexology.

My seminars are about drafting clearer contracts in English. If such contracts are void in Indonesia, nothing much would be gained from drafting them more clearly!

An appeal has already been filed, and I hope that this judgement is overturned. Use of English in international contracts isn’t a function of post-imperialist overreaching by the West; instead, it’s a matter of convenience. This is from the introduction to MSCD:

English is used in contracts around the world, and not only in contracts between companies from English-speaking countries. English has become the lingua franca of international business. A Swedish company and a Brazilian company might elect to have any contracts between them be in English, rather than Swedish or Portuguese. And a German company that’s part of an international group might prefer that its contracts with other German companies be in English.

Indonesian companies stand to benefit from that convenience as much as anyone.

But perhaps the most pressing reason to overturn the judgment is that I want to go to Indonesia!

I’m not suggesting that the Jakarta court is right or wrong: I have no basis for saying so, as all I know about this matter is the little that I’ve read online. Instead, I’m just noting that when this issue is considered further by a higher court, or conceivably by the legislature, perhaps they’ll decide that the convenience of English-language contracts trumps countervailing considerations.

Updated November 14, 2013, 8:25 a.m.: See the following tweets by @PramOctavy, the later one first:

Posted in International | 2 Comments

  • Nanda

    If nothing works, simply make a translation in Indonesian for the English contracts.

    • AWrightBurkeMPhil

      Provision specifying drafting convention: “This agreement is in Bahasa Indonesia, with an English-language version in an annex as a guide to interpretation. If any party claims a discrepancy between the Bahasa Indonesia part of this agreement and any part of the English-language annex, the meaning of the English-language part will be the definitive guide to the intention and meaning of the corresponding Bahasa Indonesia part.”