What Is the IIFC Court?
The existence of international financial centres in various countries serves as a strategic instrument for attracting cross-border investment. To this end, the Indonesian government is also working to establish an international financial centre.
The legal foundation for its establishment has been enacted through Law 6/2026 on the Indonesian International Financial Centre (IIFC Law). To establish an efficient financial ecosystem, the government is granting various special arrangements for areas designated as IIFC.
One such special arrangement is the establishment of the IIFC Court. This court has a number of specific powers, including adjudicating cases arising from the granting of tax facilities in the IIFC.
Notably, the IIFC Court also allows foreign nationals to serve as ad hoc judges. In addition, proceedings before the IIFC Court will be conducted in English. So, what exactly is the IIFC Court?
Referring to Article 1 number 8 of the IIFC Law, the IIFC Court is a court vested with special jurisdiction to examine, hear and decide cases within the IIFC, which is under the Supreme Court (Mahkamah Agung/MA in Indonesian).
More specifically, Article 38 paragraph (2) of the IIFC Law positions the IIFC Court as a special court within the general courts under the Supreme Court. Both articles affirm that the IIFC Court is not a judicial body outside the system of judicial power.
The IIFC Court forms part of the national judicial system under the Supreme Court, even though it is granted special authority. This is consistent with the provisions of Law 48/2009 on Judicial Power (the Judicial Power Law).
Pursuant to Article 27 of the Judicial Power Law, a special court may only be established within one of the courts under the Supreme Court. Meanwhile, Article 18 of the Judicial Power Law provides that judicial bodies under the Supreme Court comprise the general courts, religious courts, military courts and administrative courts.
The IIFC Court is placed within the general courts with special and exclusive authority to examine, adjudicate and decide cases within the IIFC. The government has also set out the specific categories of cases falling within the jurisdiction of the IIFC Court under Article 39 of the IIFC Law, comprising:
- cases related to business activities at the IIFC;
- cases arising from contracts that are implemented or will be implemented, in whole or in part, at the IIFC;
- cases arising from the granting of tax facilities at the IIFC;
- cases arising from any event or transaction that occurs at the IIFC, implemented in whole or in part within the IIFC;
- bankruptcy and restructuring cases of entrepreneurs established or registered in the IIFC;
- cases agreed by the parties to be resolved in the IIFC Court;
- any case in connection with any decision, action or negligence conducted by the IIFC Council, IIFC LP and IIFC LPJK; and
- other civil cases arising at the IFFC.
The IIFC Court also has jurisdiction to handle matters relating to the recognition and enforcement of awards issued by IIFC arbitral institutions or international arbitral awards concerning specific cases as provided under Article 39 paragraph (2) subparagraph a of the IIFC Law.
Further, the IIFC Court has jurisdiction to resolve legal matters relating to the interpretation, application, scope and effect of IIFC Council Regulations, IIFC LP Regulations and IIFC LPJK Regulations as well as the jurisdiction, competence and authority of the IIFC Court.
Notwithstanding the special authority granted, Article 39 paragraph (4) of the IIFC Law affirms that criminal cases occurring within the IIFC remain within the jurisdiction of the district court. The handling of criminal cases within the IIFC prioritises restorative justice mechanisms.
Pursuant to Article 39 paragraph (7) of the IIFC Law, the IIFC Court comprises a court of first instance and an appellate court. Cases at first instance are heard by 3 judges, whilst at the appellate level by 3 or 5 judges.
At both levels of examination, at least 1 judge must be a Supreme Court justice appointed as a judge of the IIFC Court. The structure of the judicial panel is determined by the President of the IIFC Court.
Another notable aspect is that Article 39 paragraph (12) of the IIFC Law affirms that against judgments, determinations and orders of the IIFC appellate court, no legal remedy, cassation, civil review (peninjauan kembali/PK in Indonesian) or other legal remedy may be filed with the court, tribunal, institution or other authority..
In addition to governing the establishment of the IIFC Court, the IIFC Law also sets out provisions on the structure of the court, the authority of the chief judge of the court, rules of procedure, budgetary issues and the expertise required of IIFC Court judges.
Article 41 paragraph (4) of the IIFC Law provides that judges of the IIFC Court consist of Supreme Court justices and ad hoc judges. Article 41 paragraph (7) of the IIFC Law also allows foreign nationals to serve as ad hoc judges.
To be appointed as an ad hoc judge of the IIFC Court, a candidate judge must possess expertise in international commercial law; financial law; banking law; capital markets law; insolvency law; tax law; technology law; private international law; arbitration; and/or other fields relevant to the objectives of the IIFC.
Another notable feature is the use of English in IIFC Court proceedings. This provision is consistent with Article 66 of the IIFC Law, which designates English as the language used within the IIFC. (rig)