Overview of the Forestry Regime

AuthorWilliam A. Sullivan/Christian Teo Purwono & Partners
ProfessionLicensed Foreign Advocate in Indonesia as well as a Solicitor of the Supreme Court of New South Wales
Overview of the Forestry Regime
Chapter 27 provides an overview of Indonesias regulatory regime for
forestry activities as it relates to mining.
I. Relevant Laws and Regulations
The more important laws and regulations currently governing Indonesian
forestry activities relevant to mining are as follows:
a. Law No. 41 of 1999 re Forestry, dated September 30, 1999, as amended by
Government Regulation in Lieu of Law No. 1 of 2004 re the Amendment of
Law No. 41 of 1999, dated March 11, 2004 (1999 Forestry Law);
b. Government Regulation No. 6 of 2007 re Forest Use and Composition of
Forest Management Plans and ForestUtilization Activities,dated January 8,
2007 (GR 6/2007), as amended by Government Regulation No. 3 of
2008, dated February 4, 2008, re the Amendment of Government Regula-
tion No. 6 of 2007,dated January 1, 2007,re Forest Use and Compositionof
Forest Management Plans and ForestUtilization Activities (GR3/2008);
c. Government Regulation No. 2 of 2008, dated February 4, 2008, re Types
and Tariff for Nontax State Revenues derived from the Utilization of
Forest Areas for the Purpose of Development other than Forestry
Activity of the Forestry Department (GR 2/2008);
d. Minister of Forest ry (MoFOR) Decree No. SK. 382/Menhut-II/2004,
dated October 18, 2004, re Timber Utilization Business Licenses
(MoFD 382/2009);
e. Government Regulation No. 10 of 2010, dated January 22, 2010, re
Procedures for the Alteration of the Function and Purpose of Forest
Areas (GR 10/2010);
f. Government Regulation No. 24 of 2010, dated February 1, 2010, re
Utilization of Forest Areas (GR 24/2010);
g. MoFOR Regulation No. 18 of 2011, dated March 30, 2011, re Guidance
in Respect of Rent Use Permits for Forest Areas (MoFORR 18/2011);
h. Presidential Regulation No. 28 of 2011, dated May 19, 2011, re Forest
Area Utilization for Underground Mining (PR 28/2011);
i. Presidential Instruction No. 10 of 2011, dated May 20, 2011, re Mora-
torium on the Granting of New Licenses and the Improvement of Pri-
mary Natural Forest and Peatland Management (PI 10/2011);
j. Government Regulation No. 60 of 2012, dated July 6, 2012, re
Amendment of GR 10/2010 (GR 60/2012);
k. Government Regulation No. 61 of 2012, dated July 6, 2012, re
Amendment of GR 24/2010 (GR 61/2012);
l. Presidential Instruction No. 6 of 2013, dated February 13, 2013, re Exten-
sion of Moratorium on the Granting of New Licenses and Improvementof
Primary Natural Forest and Peatland Management (PI 6/2013); and
m. MoFORRegula tionNo. 14 of 2013, dated February 20, 2013, re Amendment
of MoFOR Regulation No. 18 of 2011, re Guidance in respect of Rent User
Permits for Forest Areas (MoFORR 14/2013); and
Each of the above referenced laws and regulations, numbered I(e) to (k)
and (m) only, is the subject of a separate chapter that sets out the details of
the main provisions of the relevant law or regulation as well as provides an
executive summary of the relevant law or regulation.
II. Categorization of Forest Areas in Indonesia
Based on their function, Indonesia divides Forest Areas into three broad
categories, namely (i) Protected Forests, (ii) Conservation Forests, and (iii)
Production Forests.
As a general rule, the commercial or industrial use of forest products and
the clearing/development of Forest Areas for other activities is conned to
Production Forests and, possibly, to Protected Forests although the position
re Protected Forests is far from clear.
Production Forests, in turn, are subdivided into three further categories
being (i) Natural Forests, (ii) Plant Forests, and (iii) Rehabilitated Forests.
There can be Natural Forest Areas, Plant Forest Areas, and Rehabilitated
Forest Areas within a single Production Forest.
The Forest Products found in a Production Forest fall into two categories,
being Timber Products and Nontimber Products.
A licenseto exploit or utilizeTimber Productsin a Production Forestis called
an IUPHHK-HTI,while a license to exploit or utilize Nontimber Products in a
Production Forest is called a IUPHHBK.IUPHHK-HTI and IUPHHBK licenses
are collectively referredto, in colloquial terms, as PFP Licenses.
A license to clear Production Forest for Nontimber Product activities,
including mining activities and/or timber product activities, is called a Pinjam
Pakaior a Rent Use Permit.
The above concepts are expanded upon and discussed in greater
detail below.
384 Mining Law & Regulatory Practice in Indonesia

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