Indonesia's so-called Language Law of 2009 requires the use
of Indonesian language in all agreements to which Indonesian
companies, Indonesian citizens or State/Government institutions are
party. While not specified in the law, it is widely recognised that
the Indonesian language requirement must be followed, even where
the governing law is not Indonesian law. This applies to all
Indonesian companies, even where the shares are 100%
foreign-owned.
This has led to agreements involving Indonesian parties being
executed in Indonesian-English (dual-language) format.
The law does not specify the consequences of failure to execute
agreements in the Indonesian language. As is typical with
Indonesian laws, further details are to be contained in
implementing regulations. To date, those implementing regulations
have not been issued.
