Law No. 8 Year 2004 on Consumer’s Protection (the “Law”) provides two means for instituting legal claims. Injured parties may either channel their petition through consumer’s dispute settlement institution (“BPSK”) or ordinary courts. Out of court settlement is presumably more preferable due to the poor law enforcement mechanism of the ordinary courts. The Law stresses that out of court settlement shall be in no way exempts the offending party from their criminal responsibility (Article 45 para. 3). This provision would mean that the offending party may be subjected to both private liabilities arising out of BPSK’s decision and criminal sanctions from the court.  

The Law also regulates the circumstances where legal standing arises. Article 46 stipulates that (a) every person directly inflicted by the offense or their heir, (b) a group of consumers with similar interests, (c) a qualified Consumer Protection NGO, (d) the government or related governmental institution has legal standing to institute claims.  Parties invoking legal standing arising out of point b, c and d, however, may only institute their legal proceeding before ordinary court. This would mean that they are excluded from BPSK’s juridical competence.

BPSK is to be formed in cities or regents across the nation. Article 49 para.2 of the Law enumerates the eligibility of BPSK members, namely an Indonesian citizen, possessing good health, never convicted for criminal offense, possesses adequate knowledge of the consumer protection law, and at least is at the thirty years of age. BPSK’s will comprise of representative from the business organization, consumers and the government.  

Aside from instituting arbitration, mediation or conciliation proceeding, the BPSK is tasked with providing consultation on consumer’s protection, supervision, monitoring and receiving complaints from consumers. BPSK is authorized in performing research, examinations, investigation, call upon witnesses or alleged offender, and to decide administrative sanctions toward the offender. BPSK may request the police to assist them in calling witnesses. The Law does not render BPSK a sub-poena authority. It is interesting to note that BPSK decisions can be regarded as preliminary evidence for police criminal investigation.

Theoretically, all claims should be settled within 21 working days after the complains is received, and the offending party shall enforce the decision within 7 working days. Request to execute BPSK Decision shall be submitted to the court which jurisdiction encompasses the injured parties’ habitual residence. BPSK decision may be subjected to appeal.

In light of article 49 of the Law, the government has recently issued  Presidential Decree No. 108 of 2004 on the Establishment of Consumer Dispute Resolution Institution in the Mayoralty of Kupang, Mayoralty of Samarinda, Mayoralty of Sukabumi, Mayoralty of Bogor, Mayoralty of Kediri, Mayoralty of Mataram, Mayoralty of Palangkaraya and the Municipality of Kupang, Municipality of Belitung, Municipality of Sukabumi, Municipality of Bulungan, Municipality of Serang, Municipality of Ogan Komering Ulu and the Municipality of Jeneponto (“Decree”).

The decree contained only four articles. It, among others, regulates that all budgetary expenses related to the duties of the BPSK shall be allocated from the relevant regional budget. The Decree is in force as of 18 October 2004. (mma)