Legal Certainty of Public Interest Criteria as The Basis for The Prosecutor's Authority in Filing Bankruptcy Applications to The Court

Bankruptcy is defined as a condition in which a debtor is no longer able to repay their debts to creditors. This state of insolvency is generally caused by financial difficulties. Meanwhile, bankruptcy proceedings refer to a court decision that results in a general seizure of all assets belonging to the bankrupt debtor. Bankruptcy is regarded as a legal remedy for resolving debt- related issues that burden a debtor.Pursuant to Article 2(2) of Law No. 37 of 2004 concerning Bankruptcy and Suspension of Debt Payment Obligations, the Public Prosecutor (Kejaksaan) is vested with the authority to file a petition for bankruptcy in the public interest. This authority is further regulated under Government Regulation No. 17 of 2000 concerning Bankruptcy Petitions in the Public Interest. However, this authority is subject to limitations set out in Article 2(2) of Government Regulation No. 17 of 2000, which stipulates that the Public Prosecutor may file a petition for a bankruptcy declaration in the interest of the public only if:The debtor has two or more creditors, the Debtor has failed to pay at least one debt that is due and payable; and no other party has submitted a bankruptcy petition.The notion of “public interest”, as explained in the elucidation of Article 2(2) of Law No. 37 of 2004, is extremely broad and undefined. The term refers to the interests of the nation and state and/or the interests of the general public. Additionally, the law allows for discretion, as it includes examples stating: “in other circumstances, as deemed to be in the public interest by the Public Prosecutor.”This article aims to analyze the criteria for determining what constitutes the public interest. In conducting this analysis, the article applies the theory of authority, the theory of justice, and the theory of legal certainty.