One key to the success of the development of Islamic banks is to consider the various risks that may be experienced by the industry. One risk which be a concern of Islamic banking in Indonesia is a legal risk issues. Based on the awareness of Islamic banks in Indonesia to the legal issues, the association of Indonesian Islamic banks (ASBISINDO) organized a national seminar entitled “Dispute Resolution discourse of Islamic Banking” held at Wisma Mandiri, Jakarta (08/05).

Dispute Problems which occur between the Islamic banking and customers get special attention. Policy framework of applicable law in Indonesia offers the ease and convenience in terms of dispute settlement between the Islamic banking customers. In outline, Islamic banking disputes can be done through a Religious Courts or alternative institutions.

This is reflected in Article 55 of the Law no. 21 Year 2008 regarding of Islamic Banking. In the article, explained that Islamic banking has the discretion to resolve outstanding issues with customers. In Article 55 of paragraphs 1, explained that the dispute settlement of Islamic Banking conducted by the court within the Religious Courts. This is because the Religious Courts does have the absolute competence of Islamic banking disputes. However, Islamic banking and customers should conduct dispute resolution outside the Religious Courts based on mutual agreement. It is based on Article 55 paragraph 2 of Law no. 21 Year 2008 regarding of Islamic Banking which reads In the case of the parties have assume obligations dispute resolution other than as referred to in paragraph (1), dispute resolution is done in accordance with the contents of the Agreement.

In this case, Islamic banking and its customers have a wide choice can include resolve the dispute in BASYARNAS or through the Alternative Institute for Dispute Resolution (LAPS) defined by the Financial Service Authority (OJK).

Religious Courts are courts under the Supreme Court seeking justice for the people who are Muslims regarding certain civil matters set out in the Act.

Religious Courts include High Religious Court (appellate court), Religious Court (court of first instance), and the Special Court comprising Syar’iyah Provincial Court (court of appeals) and Syar’iyah District / City Court (trial court) .

National Sharia Arbitration (BASYARNAS) is an alternative forum outside the court (non-litigation) in the settlement of disputes or cases in Islamic banking and Islamic financial institutions (LKS) other. BASYARNAS is the only one sharia arbitration body in Indonesia.

The process of dispute resolution in arbitration institution emphasizes the freedom of the parties to establish another form of the same process, but through a simpler mechanism and expected no distortion in law enforcement so that the result can satisfy the justice of society.

In the aim to protect the interests of consumers and society, FSA has the Department of Education and Consumer Protection Affairs. Through this department, FSA regulates the Alternative Institute for Dispute Resolution (LAPS).

LAPS is an institution that has a dispute resolution service such as Mediation, Adjudication and Arbitration. LAPS can be established by the Institute of Financial Services which coordinated by the association and / or established by the agency that performs the function of a self-regulatory organization.

LAPS has widespread benefits, both for customers, financial institutions, and the FSA itself. For customers, the presence of the LAPS can provide dispute resolution service which effective and efficient. For Islamic financial institutions, the presence of LAPS can increase customer confidence. As for regulators, LAPS can proactively provide input for improvement both in terms of business in Islamic financial institutions and consumer protection regulation.

It is intended to provide convenience for both Islamic banking and sharia customers in sharia transaction.

Recently, there are 3 LAPS which already stand in the financial services sector namely BAPMI (Indonesian Capital Market Arbitration Board), BMAI (Indonesian Insurance Mediation Board), BMDP (Pension Fund Mediation Board).