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Positioning Indonesian Lawyers in this challenging transitional era

This article explores the strategic issues faced by Indonesian lawyers in a transitional era, including government positions on trade, the influence of international agreements, economic growth, legal profession positioning, and market entry challenges. It also presents a typical situation involving a loan default and provides expert advice on protecting Nordic Bank's interests in a deal with Riau Papers Co., Ltd.

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Positioning Indonesian Lawyers in this challenging transitional era

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  1. Business Contract Drafting Arief Surowidjojo FHUI, 11 September 2012 Positioning Indonesian Lawyers in this challenging transitional era

  2. Alignment of understanding on Strategic Issues • The position taken by the Government of the RI in regards to free trade, free trade zone, free trade organization, convention and and agreements: full acceptance, partial acceptance, time adjustment, etc • The influence of the Indonesian participation in the bilateral and multilateral agreements, regional and international conventions and agreements to national legislation • Indonesian positions adopted in the Constitution, laws and regulations, local regulations, public policies, and actual positions being taken • The macro economic growth of RI in the next decades • The Indonesian strategic plan for economic development • The governance conditions, public and private • The natural resources, human capital conditions, infra structure development and positioning in the emerging markets and other competitive advantages and disadvantages • Alliance with fastest growing economies

  3. The Indonesian legal profession and its positioning • Litigation and commercial law practices • Bar Associations • Policies on foreign law firms and lawyers practicing in Indonesia • Human capital in the Indonesian legal profession: legal education, continuing legal education, professional ethics and responsibilities, the future trends • Foreign legal education • Association with foreign law firms or hiring foreign law lawyers • Competition in the region and globally • The future role of lawyers in public and private sectors • Responsible practices: governance, green, and socially responsible

  4. The Indonesian lawyers: entering the market • Mapping the trend of law practices • Mapping the competition in the international, regional and local markets • Understanding the markets • Creating new focus and expertise of law practices • Profiling a new breed of lawyers • World standard professional capability • Integrity: governance, green and socially responsible • Creating new kind of legal services • Getting access to the highest quality legal education and training • Combining local and foreign legal education • Choosing the training ground • Creating a track record of experiences • Creating supporting network

  5. A typical situation • Nordic Bank, a bank established in Norway, through its main branch in Hong Kong provides a syndicated loan facility of 1 billion $ to Riau Papers Co., Ltd., a company established in Singapore. The syndicated banks consist of 18 large and medium sized banks from the US and Europe. Riau Papers issues convertible bonds to PT Riau Pulps and Papers Tbk., a public company in Indonesia engaged in pulp and papers business. PT Riau Papers also obtained loan facilities from Bank Mandiri and Bank BNI amounting to 500 million $ secured by all immovable and movable assets of PT Riau Papers. PT Riau Papers is wholly owned by Riau Papers Co., Ltd. The ultimate controlling owner of Riau Papers Co., Ltd., is Mr X, a famous Indonesian businessman well connected politically. Mr. X issues a personal guarantee to the syndicated banks for all payment obligations of Riau Papers Co., Ltd. PT Riau Papers produces pulps and papers with an access to products of an industrial forest owned and managed by PT Hutan Tanaman Industri, a state owned company operating in the province of Riau.

  6. A typical situation • PT Riau Papers is in default in its payment obligations to Bank Mandiri and Bank BNI, and as such is in technical default to Riau Papers Co., Ltd., under the Convertible Bonds Subscription Agreement, and in turn Riau Papers Co., Ltd., is threatened to be in default to its obligations to the syndicated banks. Some of the banks are in trouble because of the crisis in Europe and the US. The industrial forests of PT Hutan Tanaman Industri overlaps with the primary forest under the new local regulation on spatial, and conservation NGOs are promoting campaign to stop the operations of PT Hutan Tanaman Industri because of that, and in addition because of the new finding that the products of PT Hutan Tanaman Industri contains elements of products from the primary forests. • Nordic Bank comes to you and asks your opinion on how to protect their interests in the deals with Riau Papers Co., Ltd., that soon will collapse.

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