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ARTICLE · 29 OCTOBER 2026

New Mining Decree Restricts Use Of Affiliated Mining Contractors And Emphasizes Local Providers

ABNR Counsellors at Law
ABNR Counsellors at Law
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ABNR Counsellors at Law

ABNR Counsellors at Law

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Indonesia's Ministry of Energy and Mineral Resources has issued a new decree that significantly restricts mining license holders from using affiliated contractors and mandates priority for local mining services providers. The regulation introduces a beneficial ownership test to determine affiliate relationships and limits approvals to companies carrying out government assignments, potentially reshaping contractor selection practices across the Indonesian mining sector.

IndonesiaEnergy and Natural Resources
Ayik Gunadi
Ayik Gunadi
Mahatma Hadhi
Mahatma Hadhi

On 18 September 2026, the Minister of Energy and Mineral Resources (“MEMR”) issued Decree No. 365.K/MB.01/MEM.B/2026 on Technical Guidelines for the Implementation of Approvals for the Use of Subsidiaries and/or Affiliates in the Mineral and Coal Mining Services Business Sector (the “Decree”). The Decree took effect on the same date and revokes Director General of Minerals, Coal and Geothermal Regulation No. 376.K/30/DJB/2010 on the same subject.

The Decree is generally concise, but it has drawn wide media and industry attention for two reasons. First, it widens the restriction on mining license holders using their subsidiaries or affiliates as contractors, and limits approvals to holders carrying out a government assignment. Second, it requires mining companies to prioritize mining services companies located in the regencies or municipalities (kabupaten/kota) around the mining area.

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