Track: Case Studies

Abstract

Composition in bankruptcy is permitted by Article 144 of Law No. 37 of 2004 regarding Bankruptcy and Suspension of Debt Payment Obligations which gives the Debtor the right to offer composition to all Creditors. However, in case that the bankruptcy comes from the failure of Suspension of Debt Payment Obligations because the composition plan offered by the Debtor was rejected by its Creditors, the Commercial Court and the Supreme Court do not share the same view regarding whether it is permissible to make a composition in bankruptcy. In the bankruptcy case of PT Hanson International Tbk., the Commercial Court using an extensive interpretation method held the view that composition in bankruptcy that comes from Suspension of Debt Payment Obligations is permissible, while the Supreme Court using a restrictive interpretation method held the opposite view. Therefore, in this study, the author conducted a study of these disparities by using the grammatical interpretation method of Article 144 of the Bankruptcy and Suspension of Debt Payment Obligations Act.