Saturday, October 25, 2008

Understanding Mineral Policy In Indonesia

  • Based on the Indonesian Mining Law it is determined that all minerals found within the Indonesian mining jurisdiction in the form of natural deposits as blessings of God All Mighty are national wealth of the Indonesian people and shall, therefore, be controlled and utilized by the State for the maximum welfare of the people.
  • This policy is based on Article 33 of the Indonesian Constitution Law which specifies that the state maintains total sovereignty over land and mineral resources of the country and that they shall be used and developed for the full benefit and welfare of the people.
  • The government thus administers mineral resources development on behalf of the people.Accordingly, within the spirit surroundings this policy framework, are the laws and regulations established by the Government together with the House of Peoples Representative (DPR).
  • This is different with the system in other countries where individuals owning a certain peace of land will be recognized by State of having title ownership on the minerals found below the land owned by such private individual. Besides the written laws, in practices we frequently found unwritten policies which needs us to get the correct guidance since the interpretation between the individual government officers sometimes may differ on to the other.
  • Accordingly, if we happen to be the in-house lawyer in a foreign mining companies, we usually must be equipped with skills, to bridge the understanding and perceptions and wants of the Mining Investors and the officers either local or central.This is significant, to enable in reaching meeting of minds between the foreign investors who are used with their way of dealing with mining operations in their home country and the local mindsets.In common language, if we want to make our sandwich and hamburgers be eaten and taste by the local people, than we have to try to put some local traditional contents in serving such sandwich and hamburgers.
  • With the same spirit, if the local people want their traditional foods to be viewed by foreigners, than the local people must take into considerations in putting some foreign vegetables or contents, which are known by such respective foreigners wherever they come from.
  • By making the above samples, I just wanted to say as a practice business lawyer, that regulations and laws does not stand by itself in a vacuum empty space, but is developed and shaped by the surroundings where such mineral deposits is located.
  • If such same minerals deposits for instances ore, gold, coal or nickel is located in Australia, then the laws and rules of the people in Australia will influence them in making and developing such mineral deposits.
  • These principles will also apply to other countries, where such mineral deposits of ore, gold or nickel are located for instance in America Latin Countries like Chile, Venezuela and in other parts of the world.
  • We also understand that in Indonesia, when Indonesia was under the sovereignty of the VOC, as well as the Dutch, the VOC, and Dutch economical, political system and their peoples view, had shaped the laws and regulations related to the Mineral Deposits, where individual Dutch / Foreign person or Dutch /Foreign Companies may owned the mineral deposits which is known as concession right.
  • While as we understand the local have their traditional perspective relating to the minerals deposits, like in Irian Jaya or Papua, the local people has the believe system that the mountain, including what it contains which are mineral deposits, are considered to be their mother
  • Having said the above, we may understand the laws and regulation more clear, since the rules and laws which are being laid down by the Legislator are influence and at a certain level a political product of such Nation and State.
  • Jakarta Indonesia
  • Also Published in ALLVOICES GLOBAL MEDIA
    • Agung Supomo Suleiman
    • Partner at Law Firm Suleiman Agung & Co
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