Contract renegotiation in COVID-19 outbreak: Is based on good faith, force majeure, or rebus sic stantibus?
Ahmad Fachri Faqi Marsuki

a) Kantor Hukum Wangsa Kuntoro Izzudin & Associate - Jakarta, Indonesia.
b) Sekolah Tinggi Ilmu Hukum (STIH) Litigasi Pengayoman - Jakarta, Indonesia.
*fahrifaqi.marsuki[at]gmail.com

Abstract

The public health crisis of the global COVID-19 outbreak has urged the government of Indonesia to take several measures. The regional government has been continuously implementing large-scale social restrictions or PSBB by restricting people^s movements. The Economy becomes near-standstill, that businesses face constraints to perform their contracts. The central government has issued economic stimulus for financial sectors such as relaxation for contract performance to counter economic distress. This policy poses a legal problem since it creates clutter with private law (contractual relationship). The stimulus is ineffective since some creditors insist on applying contractual obligations, or debtors have to meet certain conditions to obtain such relief. Such circumstances, therefore, raise an issue relating to contract renegotiation in the COVID-19 outbreak. This paper aims to examine three concepts in law: good faith, force majeure, and rebus sic stantibus doctrine, which can explain important aspects of contract renegotiation in the COVID-19 pandemic. This paper is normative legal research using primary, secondary, and tertiary data. The issue to be addressed is which concept(s) may apply in contract renegotiation based on Indonesian law.

Keywords: contract- covid-19- renegotiation

Topic: Trade and Business