Sources of Economic Law

Sources of Economic Law

By Sugi Aritonang

Sources of Economic Law – Understanding Source Law is something that gives rise to rules that have coercive power, that is, if they are violated, they will result in firm and real sanctions. The definition of legal sources can be interpreted as materials used as a basis by the court in deciding cases. The term source of law has many meanings.

Definition of Source Law according to the sociological perspective are the factors that really cause the law to really apply. These factors are the facts and circumstances that become social demands to create law.
Definition of Source Law from a philosophical point of view, namely in the sense of justice which is the essence of law. Therefore, based on this understanding of legal sources, legal sources establish criteria to test whether the applicable law reflects justice and fairness. Since the establishment of the historical school, there has been a view that the source of the essence of law is social awareness of the law. Thus the source of law concerns political, economic, cultural and social factors.

There are 2 types of legal sources, namely:

  1. Material legal sources, namely legal sources viewed from various perspectives.
  2. Formal sources of law, namely laws, customs, jurisprudence, treaties and doctrines.
Economic law was born due to the rapid growth and development of the economy. Economic Law is divided into two, namely:

Economic development law, which includes legal arrangements and ideas regarding ways to improve and develop Indonesia’s economic life nationally,

Social Economic Law, which concerns the regulation of legal thought regarding ways of distributing the results of national economic development fairly and with the dignity of humanity (human rights) of Indonesian people.

Sources of business/economic law in the legal aspect consist of legal sources, namely:

1. Legislation

Legislation in this case includes the laws of the Dutch East Indies heritage in Indonesia in the past, but are still considered valid and valid today based on the transition to the 1945 Constitution, for example the provisions contained in the KUHD (Book of Commercial Law). In addition, there are also laws and regulations concerning companies in Indonesia, based on Pancasila and the 1945 Constitution, which continue to be implemented and developed to this day.

2. Company Agreement/Contract

An agreement or contract is an event in which one or one party promises to another person or party or in which two people or two parties promise each other to carry out something (Article 1313 of the Indonesian Civil Code). Therefore, the agreement applies as a law for the parties who bind themselves, and results in the emergence of a relationship between the two people or the two parties which is called an engagement. The agreement publishes an agreement between two people or two parties who make it. In its form, the agreement is in the form of a series of words containing promises or promises that are spoken or written.

Company contracts or commonly referred to as agreements are always written and are considered the main source of rights and obligations of the parties involved in an agreement. If at a certain time there is a dispute between the related parties, in this case when the company contract is still valid, then the settlement can be made through reconciliation, arbitration, or general court even if no clear settlement is found. Of course, this company contract will provide certain considerations as well as clearly influence the decision. Because it is clearly all about the contact and the terms have been stated in the contract.

3. Treaty

A treaty is an agreement made by 2 or more countries on certain issues that are in the interest of the country concerned in its implementation. This treaty is divided into two, namely as follows:

  1. A bilateral treaty is an agreement made by 2 countries. In this treaty, it has a closed nature because it only involves between 2 interested countries. An example is the dual citizenship agreement between Indonesia and China.
  2. A multilateral treaty is an agreement made by more than 2 countries. This treaty has the nature of being open for other countries to join. For example like the United Nations, NATO and others.

4. Jurisprudence

Jurisprudence is a previous judge’s decision to face a case that is not regulated by law and is used as a guide for other judges to resolve the same case.

Jurisprudence in economics is a source of corporate law that can be followed by related parties. This will fill the legal vacuum, especially if there is a dispute regarding the fulfillment of rights and obligations. Automatically, this jurisprudence will guarantee the protection of the interests of the parties, especially for those who do business in Indonesia.

5. Habits

Custom is a special source of law that is not formally written. Employers can follow the custom as a source of law when the regulations regarding the fulfillment of rights and obligations are not stated in the laws and agreements. Because of that, the habit that has prevailed and developed among entrepreneurs in running a company usually becomes a role model to achieve the goals according to the agreement. Habits that can usually be a reference for companies are those that meet the following criteria:

  1. civil acts,
  2. Regarding the rights and obligations that must be fulfilled,
  3. Does not conflict with the law or other sources of law,
  4. Accepted by all parties voluntarily because it has been considered as a logical and obedient thing, and
  5. Receive from various legal consequences desired by all parties.

6. Doctrine

The understanding of doctrine is the opinion of leading legal experts which is used as the basis or important principles in law and its application. Doctrine as a source of formal law is widely used by judges in deciding cases through jurisprudence, and even has a very large influence in international relations.

Reference :

  1. Budiyanto, Fundamentals of State Administration, Jakarta: Erlangga 2003 page 125
  3. Peter Mahmud Marzuki, 2009. Introduction to Law. Which published Kencana Prenada Media Gro Elsi Kartika Sari and Advendi Simangunsong, 2007. LAW IN ECONOMY. PT Grasindo Publisher: Jakartaup: Jakarta.