The Court Rejects Request for Test of Material for Liquidator Rules

The Constitutional Court (MK) refused the material test of the rules regarding the liquidator as stated in Law Number 40 of 2007 concerning Limited Liability Company (PT), on Thursday (2/14/2019) in the Plenary Session Room of the Constitutional Court. The Constitutional Court Justices considered the Petitioner's petition unlawful.

In his petition, a number of liquidators who are members of the Indonesian Liquidator Professional Association (PPLI) were listed as Petitioners for Case Number 29 / PUU-XVI / 2018. The Petitioners questioned the absence of clear requirements related to the liquidator profession. This causes legal uncertainty and the threat of criminalization of the profession of the Petitioner. The applicant called the factual loss experienced by many liquidators who were not Indonesian citizens (foreign liquidators) or foreign liquidator institutions practicing liquidation against Indonesian legal entities or foreign companies in Indonesia. On the other hand, the potential loss that can be experienced by liquidators is the absence of legal protection due to the obscurity of the definition of the liquidator.

The Deputy Chairperson of the Aswanto Court when reading the legal considerations of the Constitutional Court citing the Petitioner's argument that the liquidator carried out by the directors was not independent and the existence of conflict of interest was an excessive and unfounded concern. He explained that in carrying out their duties and responsibilities, the liquidator carried out by the directors and liquidators appointed by the GMS was always monitored and could be given advice by the board of commissioners.

"They can also be temporarily dismissed if they are suspected of being negligent in carrying out their duties and responsibilities. They can also be dismissed permanently if the reason for the temporary dismissal by the board of commissioners is received at the GMS, "he said firmly.

Moreover, said Aswanto, other sanctions for negligence by liquidators from both the directors and the liquidators appointed by the GMS caused losses to both the company and other parties. This includes creditors caused by the negligence of the liquidator who can be sued personally ( personal liability ) or jointly ( jointly and severally liable ).

"The Court is of the opinion that the Petitioners' arguments relating to the liquidator must be Indonesian citizens and that the directors cannot act as liquidators, as stipulated in Article 142 paragraph (3) of Law 40/2007, is unreasonable according to law," he said. (Arif Satriantoro / LA)

Source: THE CONSTITUTIONAL COURT OF THE REPUBLIC INDONESIA

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The Court Rejects Request for Test of Material for Liquidator Rules

The Constitutional Court (MK) refused the material test of the rules regarding the liquidator as stated in Law Number 40 of 2007 concerning Limited Liability Company (PT), on Thursday (2/14/2019) in the Plenary Session Room of the Constitutional Court. The Constitutional Court Justices considered the Petitioner's petition unlawful.

In his petition, a number of liquidators who are members of the Indonesian Liquidator Professional Association (PPLI) were listed as Petitioners for Case Number 29 / PUU-XVI / 2018. The Petitioners questioned the absence of clear requirements related to the liquidator profession. This causes legal uncertainty and the threat of criminalization of the profession of the Petitioner. The applicant called the factual loss experienced by many liquidators who were not Indonesian citizens (foreign liquidators) or foreign liquidator institutions practicing liquidation against Indonesian legal entities or foreign companies in Indonesia. On the other hand, the potential loss that can be experienced by liquidators is the absence of legal protection due to the obscurity of the definition of the liquidator.

The Deputy Chairperson of the Aswanto Court when reading the legal considerations of the Constitutional Court citing the Petitioner's argument that the liquidator carried out by the directors was not independent and the existence of conflict of interest was an excessive and unfounded concern. He explained that in carrying out their duties and responsibilities, the liquidator carried out by the directors and liquidators appointed by the GMS was always monitored and could be given advice by the board of commissioners.

"They can also be temporarily dismissed if they are suspected of being negligent in carrying out their duties and responsibilities. They can also be dismissed permanently if the reason for the temporary dismissal by the board of commissioners is received at the GMS, "he said firmly.

Moreover, said Aswanto, other sanctions for negligence by liquidators from both the directors and the liquidators appointed by the GMS caused losses to both the company and other parties. This includes creditors caused by the negligence of the liquidator who can be sued personally ( personal liability ) or jointly ( jointly and severally liable ).

"The Court is of the opinion that the Petitioners' arguments relating to the liquidator must be Indonesian citizens and that the directors cannot act as liquidators, as stipulated in Article 142 paragraph (3) of Law 40/2007, is unreasonable according to law," he said. (Arif Satriantoro / LA)

Source: THE CONSTITUTIONAL COURT OF THE REPUBLIC INDONESIA

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