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Two Government Regulations Amend the Forestry Regime
Government Regulation No. 60 of 2012 on the amendment of No. 10 of 2010 on Procedures for Conversion of Allocation and Functions of Forest Areas (“PP 60/2012”) and Government Regulation No. 61 of 2012 on the amendment of No. 24 of 2010 on Forest Area Utilization (“PP 61/2012”) have recently been issued to address a number of outstanding issues with the regulatory framework. PP 60/2012 simplifies land replacement for permanent or limited production forests by removing the “adjacent to a forest” requirement, and PP 61/2012 is intended to provide certainty for borrow to use license holders, allow strategic industries to operate in forest areas, and reconcile conflicts with the Law No. 26 of 2007 on Spatial Planning Law.
PP 60/2012
PP 60/2012 is specifically targeted at plantation companies operating in production forest (hutan produksi) areas, but also applies to other forests users, including logging and mining companies in relation to the provision of replacement land.
The regulation changes the provisions relating to the replacement land, most noably removing the requirement that replacement land (for hutan produksi tetap and hutan produksi terbatas) be located adjacent to a forest.
In relation to plantation companies operating in production forest (hutan produksi) areas, so as to bring the regulatory framework in line with the Spatial Planning Law, a requirement is introduced requiring plantation companies holding pre-Spatial Planning Law to obtain borrow to use permits (izin pinjam pakai kawasan hutan) from the Minister of Forestry within 6 months of the issuance of the regulation (i.e. before 6 January 2013) and provide replacement land, if so required (hutan produksi tetap and hutan produksi terbatas), within 2 years of such approval (Articles 51A and 51B).
PP 61/2012
PP 61/2012 ensures that borrow to use permits remain valid until expiry even if spatial planning designations are changed, and requires mining license holders with pre-Spatial Planning Law licenses who operate in production forests to apply for a borrow to use permit before the end of the year.
Amendments of Article 4 (2)(i and m) open up forest areas to industrial activities (whereas previously this was restricted to forestry-related industrial activities) and agricultural activities in the context of food and energy security.
Removal of Article 20 (1)(d) in conjunction with the amendment of Article 25 (b) has the effect of providing certainty to holders of borrow to use permits by removing the ability for a permit to be invalidated by a re-designation of the forest area. Some uncertainty remains however, since the renewal/extension of the affected borrow to use permits is not addressed.
In relation to mining companies operating in production forest (hutan produksi) areas, so as to bring the regulatory framework in line with the Spatial Planning Law, a requirement is introduced requiring mining companies holding pre-Spatial Planning Law licenses to obtain borrow to use permits (izin pinjam pakai kawasan hutan) from the Minister of Forestry within 6 months of the issuance of the regulation (i.e. before 6 January 2013) (Article 25A).
Source: Government Regulation No. 60 of 2012 on the amendment of No. 10 of 2010 on Procedures for Conversion of Allocation and Functions of Forest Areas; Government Regulation No. 61 of 2012 on the amendment of No. 24 of 2010 on Forest Area Utilization.
For more information please visit www.lgslaw.co.id
For more information please visit www.lgslaw.co.id
