Regulation Amending Mineral and Coal Mining Enterprise Activities Regulation

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
Pages193-200
CHAPTER 16
Regulation Amending Mineral
and Coal Mining Enterprise
Activities Regulation
I. Executive Summary
1. Overview
1.1 The Mining Enterprise Activities Amendment Regulation (hereinafter
referred to as GR 24/2012) was issued with legal effect from
February 21, 2012.
1.2 GR 24/2012 makes a number of major changes to the 2009 Mining
Law and GR 23/2010.
2. Approach
2.1 IUP Issuing Authority: It now appears to be the case that, as a result
of GR 24/2012, IUPs will be issued to PMA Companies (i.e., to foreign
investors) only, by MoEMR rather than by the Regent of the Regency
where the mining concession is located (new Article 6(3b)). IUPs for
domestic investors will, however, continue to be issued by the Regent
of the Regency where the mining concession is located.
2.2 Presumably, if IUPs will be issued to PMA Companies by MoEMR, this
also means that only MoEMR can cancel or revoke those IUPs
although this is not made clear in GR 24/2012.
2.3 Transfer of IUPs: Although very curiously worded and replete with a
number of double negatives, GR 24/2012 seems to have amended GR
23/2010 so as to allow the transfer of IUPs where the transferee is a
company 51% or more owned by the transferor at the time of transfer.
2.4 Divestiture of Shares: The divestiture requirement applicable to
foreign-owned IUP holders has been increased from 20% to 51%.
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