DISPUTE RESOLUTION IN CONSTRUCTION THROUGH ARBITRATION: CONTRACT CLAIMS FOR JAVA SUBMARINE CABLES 150 KV CIRCUIT 3 & 4 (REPLACEMENT & REINFORCEMENT)

Abstract

This paper explores the settlement of construction disputes through arbitration, focusing on a claim regarding the Java Submarine Cables 150 kV Circuit 3 & 4 (Replacement & Reinforcement) project. The arbitration process, selected as an alternative dispute resolution mechanism, was initiated due to delays and complications arising from regulatory changes, specifically the 2011 Maritime Navigation Regulations, which impacted the project's timeline and execution. The contractor, PT Boskalis International Indonesia, filed claims related to project suspensions and cost overruns caused by delays in obtaining essential permits. Through the Badan Arbitrase Nasional Indonesia (BANI) arbitration, a resolution was reached, dividing the responsibility for costs between PT PLN (the client) and the contractor. The paper emphasizes the advantages of arbitration in resolving construction disputes, including its confidentiality, speed, and the ability to appoint experts as arbiters. The final ruling, which was binding, provided a fair and efficient resolution to the complex issues involved.