||The PhD dissertation is centered on a specific legal phenomenon as occurred during a specified period of time and within a specific legal jurisdiction. The main purpose of the relevant research-study is not to introduce a new legal theory or to challenge any existing legal thoughts, but rather to share a valuable experience that took place in Indonesia legal system and its legal tradition. On the one hand, it is about a government program/undertaking that was carried out by the Indonesian Banking Restructuring Agency (“IBRA”) to confront and overcome the 1997 financial currency crisis and its’ adverse consequences. On the other hand, it is about “the legal bond” between the controlling shareholders of IBRA banks and the State of Indonesia, as regulated for and/or contracted in peculiar settlement agreements.
The “Shareholder Settlement Program”, and the associated “settlement agreements”, contained many interesting matters that could be viewed, studied, debated, and elaborated from various disciplines of law and legislation, such as the administrative law, criminal law, banking law, corporate law, and contract law. Nevertheless, the PhD research-study will focus on particular juridical undertaking, i.e. “exchanges of promissory obligations and the fulfillment thereof” between owners of IBRA banks and IBRA under the auspices of the Shareholder Settlement Program. The actual execution of the program will be elaborated in analytical-descriptive manner, based on juridical-normative research methodology and empirical-illustrative analysis of the relevant research materials and tools.
The research-study does not intend to address and answer all the inquiries and reservations pertaining to the Shareholder Settlement Program, and the associated legal bond between IBRA and IBRA banks’ owners, and focuses on the following focal points and inquiries:
First, in light of the importance of safe and sound banking system, did the condition of the banking system in Indonesia in 1997 inevitably lead to the difficulties that endangered the sustainability of the national economy?
Second, were the out-of-court method and mechanism of the Shareholder Settlement Program, a much-preferred alternative during the unprecedented systemic banking crisis and the economic meltdown in 1997?
Third, were all shareholder settlement agreements under the auspices of the Shareholder Settlement Program valid and legally binding civil-law contracts?
Fourth, were the judiciary’s stand-points on IBRA and the important mission of the Shareholder Settlement Program contributed positively to the prevailing legal system and tradition?
In addition to the aforesaid line of thought, the research-study is also based on certain “theoretical framework” mainly aimed to answer specified questions regarding the probable existence of economic considerations/behavior behind the legal phenomenon as studied. The economic analysis of laws offers additional hindsight about the Shareholder Settlement Program and the relevant socio-economic perspectives. This type of analysis constitutes an important complementary element in the research-study undertaking, while focusing on “the out-of-court feature”, “the enforceability of settlement agreements”, and “the relevant judicial stand-points”. It is proposed by the research-study that there may have been more than one economic considerations and justifications behind the juridical events, and yet an economic theory of law will not capture the full complexity, richness, and perplexity surrounding the subject matters that it seek to illuminate. The research-study was motivated by the urge to share valuable experiences relating to the Indonesian legal system and the legal tradition, which may be useful for future references and decision making.