Standard Club has noted that its members were regularly exploring new opportunities in diverse territories and thus frequently needed to ask how the law in a particular jurisdiction might impact the enforceability of key contractual provisions.
Standard Club has therefore produced a list of key offshore jurisdictions and how the various relevant laws apply.
The study specifically looks at:
- the right to limit liability (specifically in respect of wreck removal)
- the application and geographical reach of the CLC Convention, Wreck Removal Convention, Maritime Labour Convention or any related domestic legislation
- the enforceability of knock-for-knock provisions in a contract and whether there are any gross negligence or wilful misconduct exceptions to this.
The jurisdictions covered are:
- Angola
- Australia
- Brazil
- India
- Indonesia
- Malaysia
- Mexico
- Nigeria
- Norway
- Qatar
- Saudi Arabia
- Singapore
- Thailand
- UK
- USA
The full guide is available at:
http://www.standard-club.com/media/2767858/a-guide-to-key-offshore-jurisdictions.pdf
IMN intends to provide a daily country-by country summary.
5) Indonesia
Q: Is Indonesia signatory to an international convention relating to limitation of liability for maritime claims? If not, can shipowners limit their liability under local law?
A: No. Indonesia is not signatory to any international convention relating to limitation of liability for maritime claims. However, under local law, and pursuant to the Indonesian Commercial Code, a shipowner can limit its liability for cargo claims and claims arising out of a collision with another vessel. Nevertheless, Indonesian courts rarely apply such a provision and prefer to determine the limitation amount based on their sole discretion instead.
Q: What is the geographical application of the international convention or the local law under which shipowners can limit their liability?
A: Indonesian law is silent on this issue.
Q: Are there any exclusions or exceptions in respect of offshore vessel types?
A: Indonesian law is silent on this issue.
Q: Is it possible to limit for wreck removal in Indonesia?
A: Indonesia has not ratified the Nairobi International Convention on the Removal of Wrecks of 2007, and there are no local laws purporting to the limitation of liability for wreck removal. According to Article 203 of Law No. 17 of 2008 on Shipping (Shipping Law), a shipowner is obliged to remove its shipwreck if it obstructs navigation, no later than 180 calendar days as of the sinking of the ship. Failure to do so entitles the government to remove such wreck at the expense of the shipowner.
Q: Is Indonesia signatory to the International Convention on Civil Liability for Bunker Oil Pollution Damage (Bunkers Convention)?
A: Indonesia has ratified the Bunkers Convention by virtue of Presidential Regulation No. 65 of 2014.
Q: What is the geographical application of the Bunkers Convention in respect of Indonesia?
A: The ratification was made without reservation. As such, the Bunkers Convention applies to archipelagic waters, territorial waters and the Exclusive Economic Zone (EEZ).
Q: Are there any exclusions or exceptions in respect of offshore vessel types?
A: Indonesian law is silent on this issue.
Q: Is Indonesia signatory to the International Convention on Civil Liability for Oil Pollution Damage (CLC)?
A: Indonesia has ratified the CLC by Presidential Decree in 1978 and its Protocol of 1992 by Presidential Decree in 1999.
Q: What is the geographical application of the CLC in respect of Indonesia?
A: The ratification was made without reservation. As such, the CLC shall apply to archipelagic waters, territorial waters and the EEZ. It may also apply to internal waters, as one of the implementing national legislations of the CLC, Presidential Regulation No. 109 of 2006 on the Prevention of Oil Spill in Sea, defines the ‘sea’ as consisting of internal waters, archipelagic waters, territorial waters and the EEZ of Indonesia.
Q: Are there any exclusions or exceptions in respect of offshore vessel types?
A: Indonesian law is silent on this issue.
Q: Is Indonesia signatory to the Nairobi International Convention on the Removal of Wrecks (WRC)?
A: No. Indonesia is not signatory to the Nairobi International Convention on the Removal of Wrecks (WRC).
Q: Is Indonesia signatory to the Maritime Labour Convention (MLC)?
A: Indonesia has ratified the Maritime Labour Convention, 2006 (Law No. 15 of 2016).
Q: Has the law of Indonesia determined whether offshore vessels such as mobile offshore drilling units, mobile offshore production units, dredgers, cable/pipe layers, semisubmersible/heavylift vessels, accommodation units or supply/support vessels are ‘ships’ within the meaning of the MLC?
A: While the MLC has been ratified, no implementing regulation has been issued to date. Therefore, there is no regulation which defines if offshore vessels are to fall within the definition of a ‘ship’ for the purposes of the MLC.
Q: Do the 2014 Amendments to the MLC whereby shipowners must have financial security in place to cover the repatriation of seafarers in the event of abandonment, and contractual payments in the event of a seafarer’s death or long-term disability due to an occupational injury, illness or hazard apply under the laws of Indonesia?
A: Indonesia has not ratified the 2014 Amendments to the MLC 2006.
Q: Is ‘gross negligence’ or ‘wilful misconduct’ recognised as a legal concept under Indonesian law?
A: As far as civil law is concerned, the Indonesian Civil Code (ICC) is silent on the concept of gross negligence and wilful misconduct. Article 1366 of the ICC mentions ‘negligence or carelessness’ without further elaborating the threshold as to what constitutes negligence or carelessness.
Q: Is the knock for knock liability regime a recognised concept under Indonesian law?
A: A knock for knock liability regime is not a legal concept expressly recognised under Indonesian law; therefore, its applicability and interpretation will be determined by the court on a case by case basis.
Q: If knock for knock is a recognised liability regime under Indonesian law, will it be upheld in the event of ‘gross negligence’ or ‘wilful misconduct’?
A: As concepts of knock for knock liability, gross negligence and wilful misconduct are not expressly recognised under Indonesian law, each case must be determined on its own facts and merits, although considerations may be given to previously decided/ similar cases and academic theories.
Q: Will industry standard contracts such as BIMCO’s TOWCON, TOWHIRE, SUPPLYTIME, WRECKHIRE, WRECKSTAGE, WRECKFIXED and HEAVYCON be upheld under Indonesian law?
A: If parties agree to Indonesian law as the governing law, such standard contracts are enforceable or upheld to the extent that they do not contain provisions in violation of mandatory provisions of Indonesian law. Any provisions that contravene mandatory provisions of Indonesian law will be deemed null and void.
For further information, contact
Nicholas Mavrias
Senior Claims Executive
+65 6506 2802
Sahat Siahaan,
Partner, ABNR Counsellors at law
+62 21 250 5125