M. Hadyan Yunhas Purba

The aim of this study is to analyze the legal framework governing partnerships between micro, small, and medium enterprises (MSMEs) and large businesses in Indonesia, as stipulated by Law Number 20 of 2008. Specifically, it investigates the Law’s alignment with the principles of substantive and formal justice and legal certainty enshrined in Law No. 10/2004. Utilizing a normative juridical approach and qualitative analysis of legal documents, the study identifies a critical imbalance in the legal framework governing MSME partnerships with large businesses. While Indonesian MSMEs Law aims to empower MSMEs, it lacks provisions outlining their specific rights and obligations within partnerships and omits sanctions for their contractual violations. This starkly contrasts the detailed prohibitions and sanctions imposed on large businesses, creating an environment of legal uncertainty and potential injustice. This imbalance could have detrimental consequences, discouraging investment, hindering MSME growth, and ultimately impeding economic development. By allowing MSMEs to operate with limited accountability within partnerships, the Law may inadvertently harm the entities it seeks to protect. This study makes a novel contribution by highlighting this disparity and its potential implications for the Indonesian economy. It argues that the absence of clear sanctions for MSMEs undermines the principles of justice and legal certainty, potentially jeopardizing the sustainability of MSME partnerships. The study recommends a revision of Indonesian MSMEs Law to incorporate explicit sanctions for MSME violations, thereby fostering a balanced legal framework that promotes mutually beneficial partnerships and contributes to robust economic growth in Indonesia.

Acknowledgment
The authors acknowledge the Universitas Sumatera Utara’s Doctor of Law program, the Faculty of Law, the Research Institute, and other parties who have contributed to and assisted in this analysis.