Client Newsflash

MOLHR Regulation Revises Curator/Administrator Fees in Bankruptcy

The Minister of Law and Human Rights (MOLHR) issued Regulation No. 1 of 2013 on Guidelines for Determination of Fees for Curators and Administrators (Regulation) to stipulate new fees for Curators and Administrators under Law No. 37 of 2004 on Bankruptcy and Postponement of Debt Repayment (Bankruptcy Law), revoking the fees listed in MOLHR Decree No. M.09 HT.05.10 of 1998.
Under the Bankruptcy Law, bankruptcy actions may be initiated either by a creditor submitting a bankruptcy petition to the Commercial Court or by a debtor submitting a petition for postponement of debt settlement obligations, also to the Commercial Court.
If a creditor-initiated bankruptcy ends in reconciliation or debt settlement, the debtor’s assets will be liquidated by a Curator appointed by the court. The Curator’s fees are calculated regressively based on the value of the bankruptcy assets. The higher the value, the lower the percentage paid to the Curator.

  • Reconciliation/Amicable Settlement

Bankruptcy Assets Value
(excluding debts) Fee Percentage Example:
Assets = IDR 600 billion
Up to IDR 50 billion 5% 2,500,000,000
IDR 50 billion – IDR 250 billion 3% 6,000,000,000
IDR 250 billion – IDR 500 billion 2% 5,000,000,000
Over IDR 500 billion 1% 1,000,000,000 Total fees: IDR 14,500,000,000

  • Debt Settlement Mechanism

Bankruptcy Assets Value
(excluding debts) Fee Percentage Example:
Assets = IDR 600 billion
Up to IDR 50 billion 8% 4,000,000,000
IDR 50 billion – IDR 250 billion 6% 12,000,000,000
IDR 250 billion – IDR 500 billion 4% 10,000,000,000
Over IDR 500 billion 2% 2,000,000,000 Total fees: IDR 28,000,000,000

The Curator may also receive fees amounting to 2.5% of the sale of the debtor’s assets that are in the possession of creditors, or third parties, execution of which was deferred while the bankruptcy action was pending.
Fees for temporary Curators depend on the outcome of the proceedings: If the court grants the bankruptcy petition, the fee will be determined in an initial creditors’ meeting; if the court denies the petition, the amount will be determined by the court (0.5% under the former regulation).

If a creditor’s petition for bankruptcy is rejected in cassation or reconsideration by the Supreme Court, the court will determine the amount of fees the Curator should receive based an evaluation of the duties performed by the Curator (2.0% under the former regulation). Under the Regulation, the applicant is obliged to pay the Curator’s fees. However, this provision is inconsistent with Article 17(2)-(3) the Bankruptcy Law, which stipulates that the court may order the applicant and/or the debtor to pay the Curator’s fees.

In debtor-initiated actions, assets are liquidated by an Administrator, who will receive 10% of the value of the debts, if the action is settled by reconciliation, and 15% of the value if settled without reconciliation. Previously, the fee was calculated based on the value of the debtor’s assets.

In both creditor- and debtor-initiated bankruptcy actions, the Curator/Administrator may request fees in addition to those described above, during a meeting of the creditors.
The Regulation does not apply when Balai Harta Peninggalan (BHP) acts as the Curator or Administrator. If BHP acts as the Curator, its fees will be regulated under the prevailing laws and regulations on Non-Tax State Revenue.

April 8, 2013,
ARFIDEA KADRI SAHETAPY-ENGEL TISNADISASTRA


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The foregoing material is the property of AKSET Law and may not be used by any other party without prior written consent. The information herein is of general nature and should not be treated as legal advice, nor should it be relied upon by any party for any circumstance. Specific legal advice should be sought by interested parties to address their particular circumstances.


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