Indonesia is known as the largest producer of palm oil in the world. In 2014, the total size of palm-oil plantation areas within Indonesia amounted to 10.9 million hectares, with total exports of palm oil reaching 25.05 million tons in 2016.[1] Moreover, exports of palm oil surpassed exports within the oil-and-gas sector in 2015, reaching USD 18.65 billion in comparison with a figure for the oil-and-gas sector that amounted to only IDR 12.5 billion.[2]
 
However, these achievements come with number of obstacles attached to them. For example, a resolution issued by the European Parliament has called for the European Union to phase out the use of any vegetable oils (including palm oil) in the production of biodiesel, if such oils are produced in an unsustainable way that ultimately leads to deforestation. If introduced, this change will have a serious impact upon the Indonesian palm-oil industry by 2020.[3]
 
The palm-oil industry is also facing a number of other intractable issues, including deforestation, the complexity of licensing procedures, conflicts emerging among traditional communities and so forth. In the search for ideal solutions to these various issues, the House of Representatives (“House”) has now initiated deliberations of the Draft Bill on Palm Oil (“Draft Bill”)[4], integrating said Draft Bill into the country’s 2017 prioritized national prioritized legislation program.[5]  The Draft Bill encompasses a total of 97 articles which address various issues, including both upstream and downstream activities.
 
The Draft Bill also introduces a number of new provisions, while some of the provisions contained therein are currently regulated under the following regulatory frameworks (collectively referred to as “Existing Regulations”):