After receiving inputs from the public and (in large part) investors, the Ministry of Energy and Mineral Resources will be reviewing Law No. 4 of 2009 on Coal and Mineral Mining, and may amend the Law to substantial effect.
As quoted from Bisnis Indonesia, the Minister of Energy and Mineral Resources, Darwin Zahedy Saleh, told reporters in Jakarta(7/4) that one article being examined for revision is Article 47 of the Law, relating to the time period for mining concessions, with a view to increasing the length from 40 years as is currently allowed to 50 years under an amended regulation. Currently, areas can be licensed as a mining concession under a Production Operation Mining Business License, or ‘IUP Operasi Produksi,’ which is valid for 20 years, and can be extended two times, each for a period of 10 years. That time structure may be lengthened.
Other revisions, said the Minister, will be more to the effect of clarification in contradictory and vague areas of the Law. He made specific reference to Article 169 (a) and Article 169 (b), which many have found to be contradictory: where (a) allows Work Contracts (Kontrak Karya) and Coal Mining Working Exploitation Arrangements (Perjanjian Karya Pengusahaan Pertambangan Batubara) to remain valid until their expiry, (b) goes on to set out that the contracts must be adjusted to comply with the new Law’s provisions within 1 year of its issuance. This will be likely be revised, and clarified.
Meanwhile, Muhammad Romahurmuziy, as quoted from Bisnis Indonesia (8/4), also mentioned that the revision of the Law must also include other provisions besides Articles 47 and 169. Those provisions, among other things, are Articles 3 (c) and 131.
Article 3 (c) on the Domestic Market Obligation, which requires certain production quotas to be handed over to the Indonesian state for domestic necessities (but is vaguely regulated, at best) is likely to be clarified.
Article 131 on tax and non-tax payments levied upon various license-holders may be revised to indicate precisely how much tax, and exactly what form of non-tax state revenues are referred to.
Neither Mr. Romahurmuziy nor Mr. Saleh mentioned any specific timeframes for when any amendment would be initiated or completed.
This Indonesian Legal Brief is based upon research conducted by the hukumonline team.
After receiving inputs from the public and (in large part) investors, the Ministry of Energy and Mineral Resources will be reviewing Law No. 4 of 2009 on Coal and Mineral Mining, and may amend the Law to substantial effect.
As quoted from Bisnis Indonesia, the Minister of Energy and Mineral Resources, Darwin Zahedy Saleh, told reporters in Jakarta(7/4) that one article being examined for revision is Article 47 of the Law, relating to the time period for mining concessions, with a view to increasing the length from 40 years as is currently allowed to 50 years under an amended regulation. Currently, areas can be licensed as a mining concession under a Production Operation Mining Business License, or ‘IUP Operasi Produksi,’ which is valid for 20 years, and can be extended two times, each for a period of 10 years. That time structure may be lengthened.
Other revisions, said the Minister, will be more to the effect of clarification in contradictory and vague areas of the Law. He made specific reference to Article 169 (a) and Article 169 (b), which many have found to be contradictory: where (a) allows Work Contracts (Kontrak Karya) and Coal Mining Working Exploitation Arrangements (Perjanjian Karya Pengusahaan Pertambangan Batubara) to remain valid until their expiry, (b) goes on to set out that the contracts must be adjusted to comply with the new Law’s provisions within 1 year of its issuance. This will be likely be revised, and clarified.
Meanwhile, Muhammad Romahurmuziy, as quoted from Bisnis Indonesia (8/4), also mentioned that the revision of the Law must also include other provisions besides Articles 47 and 169. Those provisions, among other things, are Articles 3 (c) and 131.
Article 3 (c) on the Domestic Market Obligation, which requires certain production quotas to be handed over to the Indonesian state for domestic necessities (but is vaguely regulated, at best) is likely to be clarified.
Article 131 on tax and non-tax payments levied upon various license-holders may be revised to indicate precisely how much tax, and exactly what form of non-tax state revenues are referred to.
Neither Mr. Romahurmuziy nor Mr. Saleh mentioned any specific timeframes for when any amendment would be initiated or completed.
This Indonesian Legal Brief is based upon research conducted by the hukumonline team.
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