The Basis for the Authority to Resolve Disputes through Mediation and Arbitration

At the Dispute Council in Indonesia

Abstract

This study explores the authority and role of the Indonesian Dispute Council (DSI), with a specific focus on its East Java provincial branch, in resolving civil and commercial disputes through mediation and arbitration. As a non-litigation body, DSI offers alternative dispute resolution (ADR) mechanisms that serve as effective, accessible, and pragmatic substitutes for conventional court proceedings. The objective of the research is to analyze how these mechanisms contribute to efficient dispute resolution, particularly in the context of growing caseloads in the formal judicial system. Employing a qualitative empirical approach, the study collects data through in-depth interviews with DSI officers, disputing parties, and legal experts, alongside direct observation and document analysis. The findings demonstrate that mediation and arbitration conducted by DSI are marked by several advantages: they are faster and more cost-effective than court processes, conducted in a confidential manner, and encourage voluntary compliance through mutually agreed outcomes. These attributes make DSI an appealing forum for both individuals and businesses, especially those seeking flexible and informal resolution options. Furthermore, the study notes the increasing reliance on DSI for resolving a wide range of civil and commercial cases, with arbitration outcomes deemed final and binding, giving them a similar legal weight to court judgments. However, some challenges persist, such as limited public awareness, lack of widespread understanding of ADR, and insufficient regulatory support to strengthen DSI’s institutional role. The research emphasizes the urgent need to improve public legal literacy, enhance the visibility and credibility of DSI, and develop a stronger legal framework to support non-litigation pathways. These efforts are crucial to making ADR more accessible, trusted, and integrated into Indonesia’s broader legal system, ultimately promoting justice through peaceful, cooperative, and efficient means.