31 March 2022

Introducing LAPS-SJK: The New Alternative Dispute Resolution Body for the Indonesian Financial Services Sector

LAPS-SJK is an independent alternative dispute resolution body to provide integrated services to assist in the resolution of commercial disputes within the Indonesian financial service sector.

| Rizki Karim and Ahmad R. Sumartapraja

LAPS-SJK (Lembaga Alternatif Penyelesaian Sengketa Sektor Jasa Keuangan or Financial Services Sector Alternative Dispute Resolution Body) is an independent alternative dispute resolution body whose main function is to provide integrated services to assist in the resolution of commercial disputes within the Indonesian financial services sector.


LAPS SJK was established by OJK (Indonesia Financial Services Authority) along with several other self-regulatory organizations and associations in the financial services sector. It was officially instituted by way of issuance of OJK Regulation 61/2020,[i] and had begun operation since 1 January 2021.



Prior to the establishment of LAPS SJK, there existed 6 dispute resolution bodies in the financial services sector, each dealing with disputes in a specific sub-sector,[ii] as follows:


  • BAPMI, for capital market;
  • BMAI, for insurance;
  • LAPSPI, for banking;
  • BMDP, for pension funds;
  • BAMPPI, for guaranties; and
  • BMPPVI, for funding, pledge and capital ventures.


Each of these six dispute resolution bodies had their own secretariat and their respective rules, with varying degree of user-rates over the years. In 2020, OJK decided that there should only be a single integrated dispute resolution body for the financial services sector, thus the establishment of LAPS SJK. It should be noted that LAPS SJK is not the result of a merger or consolidation of the previous six dispute resolution bodies, but instead it is a new institution.[iii] The six dispute resolution bodies from the previous regime will be eventually effectively disbanded respectively after all cases pending prior to LAPS SJK’s establishment are resolved.


From 2021 hereon, LAPS SJK is the sole dispute resolution body in the financial services sector,[iv] whose role is not only to take over the scope of services as held by the previous six dispute resolution bodies, but also to expand to other sub-sectors such as fintech and payment systems.


Types and Scope of Services

The primary function of LAPS SJK is to resolve commercial disputes in the financial services sector. The two main services that LAPS SJK provide is mediation and arbitration, which are typically offered by most alternative dispute resolution bodies in Indonesia. LAPS SJK can also provide binding opinion services, that are sometimes utilized in Indonesia. LAPS SJK maintains its own list of arbitrators and mediators, as well as its own rules for arbitration, mediation, and binding opinion procedures.


Further, only certain disputes that have met the required criteria may be examined by LAPS SJK. The criteria can be summed up as follows:[v]


  • The disputes are between consumers and financial services providers; or between or amongst financial services providers or other parties in the financial services sector. The disputes must already have undergone an internal dispute resolution process, such as negotiation or similar, between the parties that did not resolve the issue.


  • The disputes must be commercial in nature, and relate to one of the following subsectors (conventional and/or sharia):
    • Banking
    • Capital market
    • Insurance
    • Pension funds
    • Fiduciary
    • Funding
    • Capital ventures
    • Credit guarantee
    • Financial technology
    • Payment systems
    • Any other products that are derivative or hybrid of financial products in the sectors above.
    • Any other transaction / products under the auspice of OJK or Bank Indonesia


  • Must be based on a written arbitration agreement between or among the parties.


Arbitration Agreement

One of the criteria for a dispute to be submitted to LAPS SJK is an arbitration agreement. While this is a relatively straightforward criterion in arbitration, a particular concern relates to ongoing disputes and/or contracts that had been effective prior to the establishment of LAPS SJK. Specifically, if those arbitration agreements refer instead to one of the dispute resolution bodies from the older regime, e.g., BAPMI, or LAPSPI. To address this concern, OJK has instituted a transition policy, as follows:


“Agreements between PUJK and Consumers that contain the choice of forum for dispute resolution through Alternative Dispute Resolution Bodies in the financial services sector that had been registered in accordance to POJK 1/2014 concerning Alternative Dispute Resolution Bodies in the financial services sector … that had existed and was made before the applicability of this POJK are transferred to LAPS-SJK in accordance with Article 6 of this POJK.”


While in essence it is true that LAPS SJK has taken over the duties and functions of the six dispute resolution bodies from the previous regime, LAPS SJK is not per se the successor of those bodies.


Ideally, all parties to an arbitration agreement that had appointed one of those bodies should reexamine their contract and revise it accordingly so as to select LAPS SJK as the chosen forum. In the absence of that, it will be interesting to see if the transition policy will be sufficient to overcome any potential challenges to jurisdiction that might be asserted.


Moving Forward 

Based on LAPS SJK’s official website, so far, a total of 1303 claims were filed within its first year of its inauguration.[vi] However, it is understood that only few of those cases have proceeded into the next phases of mediation and/or arbitration. It will be interesting to continue to monitor LAPS SJK’s development of being the single integrated dispute resolution body for the financial services sector in years to come.


To further promote its services, LAPS SJK has published a standard model arbitration clause for parties – consumers and financial services providers alike – to more easily avail themselves of the services of LAPS SJK, which can be found on their website:[vii]


The parties agree that all differences of opinion, disputes and disputes arising from and/or in connection with this Agreement and the implementation of this Agreement (hereinafter referred to as "Disputes"), whether regarding breach of contract, unlawful acts or regarding the termination and/or validity of this Agreement , which cannot be resolved by deliberation to reach consensus will be resolved through the LAPS SJK Arbitration which is held according to the rules and procedures of the LAPS SJK Arbitration, located in Jakarta, in Indonesian and decided by the Arbitration Council consisting of 3 (three) Arbitrators. The SJK LAPS Arbitration Award is final and binding.


The above is merely a standard clause and our firm would be glad to assist in drafting tailor-made clauses to adjust to the respective needs of the parties. We would also be able to assist any parties who may be in need of representation in relation to a case brought or to be brought before LAPS SJK, or to assist in relation to any other issues arising in the financial services sector.




Disclaimer: The content above is intended to provide a general guide to the subject matter, and should not be treated as legal advice. For more information on the subject matter, please feel free to contact KarimSyah Law Firm at or




[i] OJK Regulation 61/POJK.07/2020 about LAPS SJK


[ii] OJK Regulation No. 1 Year 2014 about Alternative Dispute Resolution Institution in Financial Services Sector


[iii] See,


[iv] Article 6, OJK Regulation 61/POJK.70/2020 about LAPS SJK


[v] See LAPS SJK Regulation Per-02/LAPS-SJK/I/2021 about Arbitration Rules and Procedures


[vi] See



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