Yes, foreign companies with valid claims can initiate a PKPU process against Indonesian debtors.
Under Indonesian law, Bankruptcy (“kepailitan”) and Suspension of Debt Payment Obligations (PKPU or “Penundaan Kewajiban Pembayaran Utang”) are two legal instruments provided to resolve commercial insolvency. Bankruptcy is terminal leading to liquidation, while PKPU is more of a restructuring option for debtors to settle obligations without ending their business.
Both processes are governed under Law No. 37 of 2004 on Bankruptcy and PKPU. The law provides detailed rules and procedural thresholds applicable to both Indonesian and foreign creditors. But are foreign creditors truly allowed to file?
The short answer to our main question—Can Foreign Creditors File for Bankruptcy or PKPU in Indonesia? is yes.
Indonesian insolvency law does not differentiate between local and foreign creditors when it comes to initiating legal action. As long as the creditor has a legally recognized and due debt, they are entitled to file a bankruptcy or PKPU petition in the Indonesian Commercial Court (Pengadilan Niaga).
However, being allowed to file doesn’t mean the path is simple. There are specific compliance and procedural issues that foreign creditors must navigate.
The cornerstone of Indonesia’s insolvency legal system is Law No. 37 of 2004. According to this law, the essential criteria for filing bankruptcy are:
This framework equally applies to foreign creditors, meaning no nationality-based discrimination exists. But, it requires careful attention to local procedural rules, translation of foreign documents, and representation by an Indonesian advocate.
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If you’re a foreign creditor considering legal action, here’s what you’ll need:
| Requirement | Description |
| Valid Legal Standing | Proof of debt (invoices, contracts, etc.) showing the existence of a matured, unpaid obligation. |
| Power of Attorney | Foreign creditors must be represented by an Indonesian-licensed legal counsel in court. |
| Document Translation | All foreign documents must be translated into Bahasa Indonesia by a certified sworn translator. |
| Debtor Domicile | The application must be filed at the Commercial Court within the jurisdiction where the debtor resides. |
| Sufficient Evidence | Courts require concrete, clear, and undeniable evidence that the debt exists and is due. |
Meeting these requirements is critical. Failure to do so often results in a summary rejection of the petition, especially when documentation or legal standing is unclear.
Foreign creditors often encounter several hurdles when engaging in legal processes in Indonesia:
Despite these challenges, many foreign creditors have successfully filed and enforced PKPU and bankruptcy decisions in Indonesia.
To increase your chances of success, consider these actionable steps:
A proactive, well-documented, and jurisdictionally aware filing can turn the tide in your favor.
So, can foreign creditors file for bankruptcy or PKPU in Indonesia? Absolutely. But doing it effectively requires deep legal understanding, cultural sensitivity, and strategic planning.
Indonesia’s insolvency framework does not discriminate by nationality, but it does demand procedural perfection. If you miss a step, no matter how minor, it could derail your entire petition.
With the right guidance, however, foreign creditors can successfully recover their claims, even across borders.
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At Kusuma & Partners, we’ve represented numerous international creditors in complex PKPU and bankruptcy proceedings. We understand the nuances, from document validation to court strategy.
One case involved a Singaporean financial institution owed over IDR 104 billion by an Indonesian debtor. Through timely PKPU filing, aggressive asset tracing, and strict procedural compliance, we secured a repayment plan approved by the court, saving years of litigation.
Our advice? Don’t wait until it’s too late. If your debtor is showing signs of distress, talk to a qualified local counsel immediately.
Filing for bankruptcy or PKPU in Indonesia as a foreign creditor is legally possible and practically viable, but only with the right preparation, legal counsel, and documentation. Missteps are costly, but the law is on your side when used strategically. Contact us today for a private consultation and let’s recover what’s rightfully yours.
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“DISCLAIMER: This content is intended for general informational purposes only and should not be treated as legal advice. For professional advice, please consult with us.”
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