Main Article Content

Abstract

The use of AI-Decision Making by directors is not a new phenomenon, particularly in light of the rapid technological advancements occuring each year. The legal Issues arising from this development concern, first the regulatory status of AI- based Decision-Making within Indonesia's regulatory framework, as well as the application of the Business Judgment Rule doctrine resulting from losses to the company resulting from the use of AI-Decision Making by directors. This study uses a normative legal research method that integrates a comparative study approach with an analysis of the legal and regulatory framework. The results show that Indonesia currently lacks specific and comprehensive regulations governing the use of Artificial Intelligence (AI) in corporate governance or decision-making by directors. The use of AI in business decision-making by directors is not fundamentally contrary to corporate law and does not eliminate the directors' responsibilities as the company's governing body. AI should be viewed as a decision-support tool that provides information, analysis, and recommendations to directors, not as a substitute for the business judgment and discretion inherent in the director's position. Therefore, the limits of the Business Judgment Rule's application to decisions based on AI recommendations lie not in the use of AI itself, but rather in the extent to which directors maintain independent judgment and adequate oversight of the AI system used.

Keywords

Artificial Intellegence Decision-Making Directors Business Judgement Rule

Article Details

How to Cite
Wardhani, A. K., Rakhmawati, C. S., & Tama, A. R. P. (2026). Regulation of AI Utilization in Indonesia: Business Judgment Rule Protection for Directors’ Decision-Making. Journal of Private and Commercial Law, 3(1), 67–91. https://doi.org/10.20885/JPCOL.vol3.iss1.art4

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