Indonesia’s new Criminal Procedure Code introduces the Deferred Prosecution Agreement (DPA), providing an alternative mechanism for resolving corporate criminal cases while emphasizing loss recovery and corporate governance improvement.
1. INTRODUCTION
Corporate criminal liability has become a significant development in modern criminal law systems. In practice, criminal cases involving corporations is often complex, requiring extensive evidentiary processes and potentially causing broad economic impacts on employees, shareholders, and the public.
Corporate crimes may include corruption, money laundering, fraud and various violations in the business and financial sectors. Addressing these cases therefore requires a law enforcement approach that is not capable of imposing sanctions, but also efficient in recovering losses and preventing similar violations in the future.
Through Law Number 20 of 2025 concerning the Criminal Procedure Code (“KUHAP 2025”), a new mechanism has been introduced in the form of a Deferred Prosecution Agreement (Perjanjian Penundaan Penuntutan) (“DPA”). This mechanism reflects a paradigm shift from a fully repressive approach toward a more restorative, corrective, and efficiency-oriented criminal justice system.
2. WHAT IS A DEFERRED PROSECUTION AGREEMENT (DPA)?
A Deferred Prosecution Agreement (DPA) is a legal mechanism that allows a public prosecutor to temporarily defer criminal prosecution against a corporation, provided that the corporation agrees to fulfill certain obligations.
Under Article 1.17 of KUHAP 2025, DPA is designed to resolve criminal cases involving corporations more efficiently while prioritizing the recovery of losses caused by criminal conduct.
An application for a DPA may be submitted by the suspect, defendant, or their legal counsel to the public prosecutor before the case is transferred to the court, as stipulated under Article 328 (3) of KUHAP 2025.
In this context, the term corporation refers to an organized group of persons and/or assets, either in the form of a legal entity such as a limited liability company, foundation, association, cooperative, or state-owned enterprise or a non-legal entity business organization, including firms and limited partnerships, as defined under Article 1 paragraph (55) of KUHAP 2025.
Upon receiving the application, the public prosecutor will assess the application by considering various aspects, including:
(i) the interests of the victims;
(ii) the seriousness of the violation; and
(iii) the commitment of the relevant party to improve corporate governance.
If the application is approved, the public prosecutor will notify the court regarding the drafting process of the DPA. Once the DPA is finalized signed by the parties, it will be submitted to the court for examination and judicial approval.
During the hearing, the judge examines whether the agreement complies with applicable laws and whether the obligations imposed are proportionate. The judge also considers the impact of the agreement on victims, society, the environment, and the national economic interest.
Obligations under a DPA:
KUHAP 2025 further regulates the obligations that may be included in a DPA. These obligation may include:
(i) payment of compensation or restitution to victims;
(ii) implementation of corporate programs;
(iii) improvement of corporate governance;
(iv) reporting obligations and cooperation with law enforcement authorities; and
(v) other corrective measures deemed necessary by the public prosecutor.
If all obligations under the DPA have been fulfilled within the agreed period, the court may issue an order terminating the criminal case without proceeding to prosecution. However, if the corporation fails to comply with the agreed obligations, the prosecutor may proceed with the criminal prosecution. During the validity period of the DPA, the court supervises the implementation of the agreement to ensure compliance.
3. IMPLICATIONS FOR CORPORATE LAW ENFORCEMENT
The introduction of the DPA mechanism brings several important implications for Indonesia’s criminal justice system, particularly in handling corporate criminal offenses.
First, this mechanism creates a more efficient avenue for case resolution compared to conventional litigation processes, which often require lengthy and complex evidentiary proceedings.
Second, DPA emphasizes the recovery of losses and the improvement of corporate governance as integral parts of case resolution. This approach encourages corporations to strengthen their internal compliance systems to prevent future violations.
Third, the involvement of the court in approving the DPA provides a supervisory mechanism over prosecutorial discretion, thereby maintaining a balance between law enforcement efficiency and the principle of legal certainty.
Nevertheless, the implementation of this mechanism still requires further regulation, particularly concerning procedural guidelines and supervisory mechanisms to ensure transparent and accountable application.
CONCLUSION
The introduction of the DPA in KUHAP 2025 marks a significant development in Indonesia’s corporate criminal enforcement framework, particularly in addressing corporate criminal offenses. By emphasizing loss recovery, corporate governance improvement, and judicial supervision, this mechanism has the potential to become an effective instrument for enhancing corporate accountability while maintaining the efficiency of the criminal justice system. If implemented in a transparent and proportional manner, DPA may serve as a more balanced alternative for case resolution, reconciling legal certainty, public interest, and business stability.
DISCLAIMER
This article analyzes the implementation of the Deferred Prosecution Agreement mechanism within the Indonesian criminal procedure system under Law Number 20 of 2025, particularly in relation to corporate criminal liability. This article is prepared solely for informational and academic purposes and does not constitute legal advice. Readers are advised not to act or rely solely upon the information contained herein without first obtaining appropriate professional legal advice. Laws and regulations, as well as their interpretation, may change over time, and their application may vary depending on the specific facts and circumstances of each case. For specific legal advice or further clarification regarding the matters discussed in this article, consultation with a competent legal advisor is recommended.