Legal Analysis of Constitutional Court Decision Number 18/PUU-XVII/2019 Regarding the Execution of GuaranteesFiduciary (Study of Debtor Collateral Execution Financing Institutions)

Abstract

The background of this research is based on the dominant use of fiduciary guarantees in the financing industry and the widespread practice of parate execution before the Constitutional Court decision which allowed creditors to unilaterally withdraw collateral objects without going through the judicial mechanism. The Constitutional Court decision then changed the interpretation of Article 15 paragraphs (2) and (3) of Law Number 42 of 1999 by requiring an agreement on default and voluntary surrender as a prerequisite for direct execution. This research aims to analyze the effectiveness of the implementation of Constitutional Court Decision Number 18/PUU-XVII/2019 and its implementation in balancing legal certainty for creditors and justice for debtors in the practice of fiduciary guarantee execution by financing institutions. This research uses a normative juridical method with a statutory, jurisprudential, and conceptual approach, and is supported by secondary empirical data. The results of the study indicate that the decision normatively strengthens legal protection for debtors and corrects the practice of unilateral execution. However, its implementation has not been effective due to the unclear criteria for default and the concept of voluntary surrender which are open to multiple interpretations, as well as the continued prevalence of forced withdrawal practices by debt collectors. This study concludes that further regulations and clear technical guidelines are needed to ensure a balance between legal certainty for creditors and protection of debtors' rights.