Contoh Kasus Arbitrase

Belajar Hukum Milenial

11 Dec 202013:18

Summary

TLDRMuhammad Yusuf discusses the case of Rafat Ali Rizvi versus the Republic of Indonesia, resolved through arbitration. The case revolves around Rafat, an investor from the UK, who filed a claim against Indonesia for damages due to the government's bailout of Bank Century, which impacted his investments. The arbitration tribunal, composed of international arbitrators, ruled against Rafat, emphasizing that his portfolio investment didn't qualify for legal protection under Indonesian law. The ruling also reinforced the requirement for proper approval from the Indonesian Investment Coordinating Board for investments to be protected.

Takeaways

📅 Rafat Ali Rizvi filed a lawsuit against the Republic of Indonesia on April 5, 2011, at ICSID, claiming investor protection violations.
🇬🇧 Rafat Ali Rizvi is a British investor, citing a 1977 bilateral agreement between the UK and Indonesia for the protection of foreign investments.
🏦 Rizvi invested in three Indonesian banks (Bank Pikko, PT Danpac, and PT Banks iicc) before they merged into Bank Century in 2004.
💸 The dispute arose when Indonesia provided a $6.7 trillion bailout to Bank Century, which Rizvi argued devalued his investments.
📜 Rizvi claimed protection under Indonesia's Foreign Investment Law (Law No. 1 of 1967), but Indonesia disputed the applicability of this law to his investments.
⚖️ The arbitration was conducted with three arbitrators, each side selecting one and a mutually agreed-upon chairperson for the tribunal.
❌ Indonesia challenged ICSID's jurisdiction, arguing that Rizvi's investments were not the type protected by their foreign investment laws.
🔍 The tribunal ultimately ruled in favor of Indonesia, stating that Rizvi's investment did not qualify for legal protection under Indonesian law.
💼 A dissenting opinion from one of the arbitrators, Professor Najah, acknowledged the tribunal's decision but offered differing legal reasoning.
🚫 Rizvi’s investment through Chinkara Capital was deemed an indirect investment, which did not qualify for legal protection under the bilateral investment treaty (BIT).

Q & A

What is the case discussed in the video?
-The video discusses the arbitration case of Rafat Ali Rizvi versus the Republic of Indonesia. Rafat, a foreign investor from the UK, filed a claim against Indonesia over losses related to the government's bailout of Bank Century.
Why did Rafat Ali Rizvi file a case against Indonesia?
-Rafat Ali Rizvi filed a case because he believed that the bailout of Bank Century by the Indonesian government caused him significant financial losses as a shareholder. He argued that his investment should have been protected under Indonesian law.
What was the basis of Rafat Ali Rizvi’s claim?
-Rafat's claim was based on the violation of the 'Agreement between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of the Republic of Indonesia for the Promotion and Protection of Investment.' He argued that his investment in Bank Century was protected under this agreement and Indonesian laws governing foreign investment.
How did the Indonesian government respond to Rafat’s claim?
-The Indonesian government argued that the investment made by Rafat was not covered under Indonesia’s foreign investment law, as it was not approved by the Indonesian Investment Coordinating Board (BKPM), and therefore, did not qualify for legal protection.
Who were the arbitrators in this case?
-Rafat Ali Rizvi appointed Judge Juan Fernandez-Armesto from the United States, and Indonesia appointed Professor Lowe from Australia. The two parties agreed on Dr. Gavan Griffith from Australia to serve as the presiding arbitrator.
What was the final decision of the ICSID tribunal?
-The ICSID tribunal ruled in favor of the Indonesian government, agreeing that Rafat's investment was not protected under the laws of Indonesia since it was a portfolio investment and not a direct investment, and it lacked approval from BKPM.
What were the key legal issues raised during the arbitration process?
-The key legal issues were whether Rafat's investment qualified as a protected investment under Indonesian law and the bilateral investment treaty, and whether ICSID had jurisdiction over the dispute.
What did Professor Najah’s dissenting opinion state?
-Professor Najah agreed with the tribunal’s ruling but offered a different legal reasoning. He argued that there was no special procedure for granting approval for portfolio investments and that the investment was indirect, and thus not protected under the BIT agreement.
What lessons can be drawn from this case regarding foreign investment protection in Indonesia?
-The case highlights that for foreign investments to receive legal protection in Indonesia, they must be direct investments approved by the BKPM. Portfolio investments or investments without BKPM approval do not qualify for protection under Indonesian law.
What was the significance of the tribunal’s ruling in this case?
-The ruling clarified the legal distinction between direct and portfolio investments under Indonesian law and reinforced the requirement for foreign investments to obtain proper approval from local authorities to receive legal protection.

Outlines

00:00

📝 Introduction to Arbitration Case of Rafat Ali Rizvi vs Republic of Indonesia

Muhammad Yusuf introduces a case of arbitration involving Rafat Ali Rizvi against the Republic of Indonesia. The case revolves around allegations of government actions leading to investor losses. Rafat Ali, a foreign investor from the UK, filed a lawsuit against Indonesia in April 2011 at the International Centre for Settlement of Investment Disputes (ICSID). The dispute stems from Rafat’s investments in Indonesian banks and his claim that the government’s bailout of Bank Century caused him financial losses. The arbitration was based on the Bilateral Investment Treaty (BIT) between the UK and Indonesia, specifically focusing on whether Rafat’s investments were protected under Indonesian law.

05:01

⚖️ Establishment of the Arbitration Tribunal and Legal Proceedings

The arbitration tribunal was formed in 2011, with both parties selecting arbitrators, including Judge Juan Domain and Love Sor Soran Ajah. Gavan Grief from Australia was appointed as the tribunal’s chair. Initial hearings were held without the presence of the parties, and Indonesia contested the tribunal’s jurisdiction, arguing that ICSID did not have the authority to handle the dispute. The tribunal’s jurisdiction, rooted in the Washington Convention, became a key point of contention, with discussions around the limits of ICSID’s authority and its application to investment disputes between countries and foreign investors.

10:01

🧑‍⚖️ Key Legal Issues and Tribunal Decisions

The central issue of the case was whether Rafat’s investment was protected under Indonesian law, particularly as it was not approved by Indonesia’s Investment Coordinating Board (BKPM). Indonesia argued that Rafat’s investment was not subject to legal protection as it did not meet the requirements for foreign investment. In June 2013, the tribunal ruled in favor of Indonesia, stating that Rafat’s investment was not covered by the Bilateral Investment Treaty (BIT). A dissenting opinion from Professor Najah highlighted that while the tribunal’s ruling was valid, he disagreed on the reasoning, arguing that Rafat’s investment through Chinkara Capital was indirect and thus not protected.

🔑 Final Verdict and Its Legal Implications

The final ruling of the tribunal confirmed that only direct investments are protected under Indonesian law and the BIT. Investments made without approval from the BKPM, such as portfolio investments, are not entitled to legal protection in Indonesia. The case reaffirmed the importance of adhering to legal frameworks for foreign investments, especially the necessity of obtaining governmental approval for protection under Indonesian law. This decision further solidified the distinction between direct and indirect investments, with the latter not qualifying for arbitration under ICSID rules.

Mindmap

Keywords

💡Arbitration

Arbitration is a method of dispute resolution where the involved parties agree to have their dispute settled by a neutral third party, known as an arbitrator, outside of the court system. In the script, arbitration is the primary process used to resolve the dispute between Rafat Ali Rizvi and the Republic of Indonesia. This demonstrates the international approach to resolving legal conflicts between investors and states.

💡Rafat Ali Rizvi

Rafat Ali Rizvi is the foreign investor who initiated the case against the Republic of Indonesia. His dispute is centered on the financial loss he claims to have incurred due to the Indonesian government's bailout policy. Rafat's case is central to the arbitration process described in the script, highlighting the protections sought by foreign investors under international investment agreements.

💡ICSID

The International Centre for Settlement of Investment Disputes (ICSID) is a global institution that facilitates the arbitration and conciliation of international investment disputes. In the video script, the ICSID acts as the venue where the arbitration between Rafat Ali Rizvi and Indonesia is conducted, underlining its role in resolving international legal conflicts related to investment.

💡Bailout

A bailout refers to financial support given to a company or bank to prevent its collapse. In the video, Indonesia’s bailout of Bank Century, worth 6.7 trillion rupiah, is the core of Rafat’s grievance, as he claims the bailout decision led to his financial losses. The bailout is presented as a critical policy that affected foreign investors' rights and interests.

💡Investment Protection

Investment protection refers to legal and institutional measures designed to safeguard foreign investments from risks such as expropriation, unfair treatment, or discrimination. The video describes how Rafat sought protection under a bilateral investment treaty between Indonesia and the UK, asserting that his investments should be protected under Indonesian law and international agreements.

💡Bilateral Investment Treaty (BIT)

A Bilateral Investment Treaty (BIT) is an agreement between two countries to promote and protect investments made by investors from each country in the other. Rafat Ali Rizvi’s case involves a BIT between the UK and Indonesia, which he claims provides protection for his investments. This highlights how such treaties play a crucial role in international investment disputes.

💡Bank Century

Bank Century was the financial institution created through the merger of several banks, including the ones in which Rafat Ali Rizvi had invested. The video explains that after the merger, Rafat felt his investments were devalued due to the Indonesian government's financial policies, leading to the arbitration dispute. Bank Century's situation illustrates the complexities of banking mergers and their impact on investors.

💡Jurisdiction

Jurisdiction refers to the authority of a legal body, like a court or arbitration tribunal, to hear and decide cases. In the video, there is a debate over whether the ICSID has jurisdiction to hear Rafat Ali Rizvi’s case, as the Indonesian government argues that the type of investment he made doesn’t qualify for protection under the applicable laws. Jurisdiction is key to determining whether a legal body can rule on a case.

💡Portfolio Investment

Portfolio investment involves investing in financial assets, like stocks or bonds, without directly managing the underlying business. In the video, Indonesia argues that Rafat Ali Rizvi's investment in Bank Century was a portfolio investment, which is not eligible for protection under Indonesian law. This highlights the legal distinctions between direct and portfolio investments in international disputes.

💡BKPM (Indonesia Investment Coordinating Board)

BKPM is the Indonesian government agency responsible for coordinating and facilitating foreign investment in Indonesia. In the video, the Indonesian government argues that Rafat Ali Rizvi did not obtain the necessary approvals from BKPM for his investments, which, according to them, makes his investments ineligible for protection under Indonesian law. This emphasizes the importance of regulatory approval in foreign investment protection.

Highlights

Introduction by Muhammad Yusuf discussing the arbitration case of Rafat Ali Rizvi against the Republic of Indonesia.

Rafat Ali Rizvi filed a lawsuit on April 5, 2011, against Indonesia at ICSID as a foreign investor from the UK.

The lawsuit was based on alleged violations of the bilateral investment treaty (BIT) between the UK and Indonesia.

Rafat Ali invested in three Indonesian banks: Bank Pikko, PT Danpac, and PT Bank CIC, prior to their merger into PT Bank Century.

The government of Indonesia's bailout of Bank Century in 2004 caused financial losses to Rafat Ali, leading to the arbitration.

The investor claimed that his investment was protected under Indonesia's Foreign Investment Law No. 1 of 1967.

The Indonesian government argued that Rafat Ali’s investment did not qualify for protection under the Foreign Investment Law.

Indonesia appointed three arbitrators in accordance with Article 37(2) of the Washington Convention.

Both parties agreed on the appointment of Judge Gavan Griffith from Australia as the tribunal chairperson.

Indonesia challenged ICSID's jurisdiction over the dispute, claiming that the investment did not meet the BIT’s requirements.

ICSID ruled in favor of Indonesia, stating that Rafat Ali’s investment was indirect and thus not protected under the BIT.

Rafat Ali filed for annulment of the ruling, arguing that his indirect investment should be protected.

The ruling emphasized that only direct investments, with proper approvals from Indonesia’s Investment Coordinating Board (BKPM), are protected.

The case highlighted the necessity of obtaining proper approvals for investment to qualify for legal protection in Indonesia.

The arbitration decision reinforced Indonesia’s stance on the legal distinction between direct and portfolio investments.