Mining Law and Regulatory Practice in Indonesia: A Primary Reference Source

by William A. Sullivan, Christian Teo Purwono & Partners

Overview

The first and only English-language reference to the laws and regulations of the booming Indonesian mining sector

As the growing Indonesian mining industry attracts new investment from foreign mining companies, those companies are faced with the daunting challenge of unraveling the hugely confusing and complex plethora of local laws and regulations that govern the industry. Until now, there has been no comprehensive English-language guide to Indonesia's mining laws that western companies could turn to for reliable guidance and advice. This detailed reference fills that gap for the mining companies, advisors, and consultants who must navigate this confusing and growing web of regulation on a daily basis.

• The only English-language reference on the subject of Indonesian mining law
• A valuable guide for anyone in the mining industry currently doing business or intending to do business in Indonesia
• Written by a highly regarded legal expert with deep experience in the Indonesian mining industry
• Combines all the relevant regulations in one comprehensive guide

Ideal for professionals in the mining industry, as well as academics, government institutions, policy makers, and industry associations, Mining Law&Regulatory Practice in Indonesia is the perfect guide for an underserved market.

Product Details

ISBN-13:	9781118613214
Publisher:	Wiley
Publication date:	07/01/2013
Sold by:	Barnes & Noble
Format:	eBook
Pages:	320
File size:	6 MB

About the Author

William A. Sullivan is a Licensed Foreign Advocate in Indonesia as well as a Solicitor of the Supreme Court of New South Wales; a Solicitor of the High Court of Australia; an attorney and counselor-at-law in all courts of the State of New York; an attorney and counselor-at-law in the United States District Court for the Southern and Eastern Districts; a Solicitor of the Supreme Court of England and Wales; and a Solicitor of the Supreme Court of Hong Kong, admitted to practice in each of these jurisdictions. Bill's first involvement with Indonesia came in the early 1990s when he was seconded by an Australian law firm to a leading Indonesian law firm to provide international legal expertise in corporate and securities with a particular emphasis on corporate restructuring, the development of new financial products, debt and equity raisings, and other capital markets projects. He also acted for multinational corporations with substantial investments in Indonesia and for Indonesian companies pursuing major domestic and foreign investments, particularly in the oil and gas and hotel industries. From 1999 to 2000, Bill acted as the Australian government-funded technical adviser on debt restructuring matters to Bank Indonesia (the Indonesian central bank). Since 2006, Bill has concentrated increasingly on the Indonesian mining, energy, and resources sector. He has been involved in the negotiation, structuring, and documentation of numerous coal, gold, iron ore, and mineral sands project acquisitions, financings, and investments. This work has also included both advising upstream oil and gas companies in connection with their existing operations as well as advising foreign independent oil and gas companies on potential new investments in Indonesia, particularly in the coal bed methane gas sector.

Table of Contents

Foreword xi

Preface xiii

Acknowledgments xvii

CHAPTER 1 Overview of Mining Regime 1

I Prevailing Laws and Regulations 1

II Former Mining Regime 3

III CoWs/CCoWs 3

IV Regional Autonomy 5

V Mining Activities 6

VI Mining Areas 6

VII Mining Licenses 7

VIII Procedures for Obtaining WIUPs and IUPs 11

IX Rights and Obligations of IUP Holders 12

X Domestic Market Obligation 15

XI Divestiture of Shares Requirement 16

XII Procedures for Minerals and Coal Benchmark Price Determination 17

XIII Domestic Processing and Refining 19

XIV Direction and Supervision of the Management and Implementation of Mining Business 22

XV Transitional Provisions for Existing KPs, CoWs, and CCoWs 23

XVI Mining Services 24

CHAPTER 2 2009 Mining Law 25

I Executive Summary 25

II Details of Main Provisions 26

CHAPTER 3 Mining Area Determination 43

I Executive Summary 43

II Details of Main Provisions 44

CHAPTER 4 Mining Services Regulation 53

I Executive Summary 53

II Details of Main Provisions 55

CHAPTER 5 Affiliated Mining Services Provider Regulation 65

I Executive Summary 65

II Details of Main Provisions 67

CHAPTER 6 Prioritization of Domestic Interest Regulation 71

I Executive Summary 71

II Details of Main Provisions 72

CHAPTER 7 Domestic Coal Supply Decree 2013 79

I Executive Summary 79

II Details of Main Provisions 79

CHAPTER 8 Coal and Mineral Mining Enterprise Activities Regulation 83

I Executive Summary 83

II Details of Main Provisions 85

CHAPTER 9 Mining Direction and Supervision Regulation 107

I Executive Summary 107

II Details of Main Provisions 108

CHAPTER 10 Benchmark Price Determination Regulation 117

I Executive Summary 117

II Details of Main Provisions 119

Appendix 1: Coal Adjustment Cost for HPB RE Sales of Coal by Way of FOB Barge 131

Appendix 2: Cost Adjustment for HPB RE Sales of Coal in One Island to the End User 132

CHAPTER 11 Benchmark Price Formulae Regulation 135

I Executive Summary 135

II Details of Main Provisions 136

Appendix 1: Formula for Steaming Coal Benchmark Price 139

Appendix 2: Coal Benchmark Price Reference Formula for Steaming Coal Based on Brand Name 142

Appendix 3: Formula for Coking Coal Benchmark Price 145

CHAPTER 12 Reclamation and Post-Mining Activities Regulation 147

I Executive Summary 147

II Details of Main Provisions 149

CHAPTER 13 CoW and CCoW Change of Investment Regulation 159

I Executive Summary 159

II Details of Main Provisions 160

CHAPTER 14 Extractive Industry Income Transparency Regulation 167

I Executive Summary 167

II Details of Main Provisions 168

CHAPTER 15 Increase of Added Value of Minerals through Processing and Refining of Minerals Regulation 173

I Executive Summary 173

II Details of Main Provisions 177

Appendix 1: Minimum Processing and Refining Specifications for Metal Mineral Products 188

Appendix 2: Minimum Processing and Refining Specifications for Nonmetal Mineral Products 191

Appendix 3: Minimum Processing and Refining Specifications for Rock Mineral Products 192

CHAPTER 16 Regulation Amending Mineral and Coal Mining Enterprise Activities Regulation 193

I Executive Summary 193

II Details of Main Provisions 195

CHAPTER 17 Mineral Products Export Requirements Regulation 201

I Executive Summary 201

II Details of Main Provisions 202

Appendix 1: Certain Mineral Products Subject to MOTR 29/2012 210

CHAPTER 18 Export Tax Regulation 213

I Executive Summary 213

II Details of Main Provisions 214

III Attachment IV of MoFR 75/2012: Certain Mineral Products Subject to Export Tax 216

CHAPTER 19 Regulation Amending Mining Services Regulation 219

I Executive Summary 219

II Details of Main Provisions 221

Appendix 1A: Types, Sectors, and Subsectors of Mining Services Business Activities 229

Appendix 1B: Types of Non-Core Mining Services Business Activities 232

CHAPTER 20 Acceleration of Domestic Processing and Refining Instruction 233

I Executive Summary 233

II Details of Main Provisions 235

CHAPTER 21 Draft Procedures for Issuing Special Production IUPs for Processing and Refining and Transportation and Sales Regulation 239

I Executive Summary 239

II Details of Main Provisions 241

CHAPTER 22 Draft Guidelines for Licensing of Metal Mineral and Coal Business Activities Regulation 267

I Executive Summary 267

II Details of Main Provisions 269

CHAPTER 23 Draft Guidelines for Licensing of Nonmetal Mineral and Rock Mining Business Activities Regulation 323

I Executive Summary 323

II Details of Main Provisions 325

CHAPTER 24 Draft Mining Business Employees, Goods, and Services Procurement Regulation 347

I Executive Summary 347

II Details of Main Provisions 349

CHAPTER 25 Draft Community Development and Empowerment Regulation 363

I Executive Summary 363

II Details of Main Provisions 365

CHAPTER 26 Draft Coal Value Added Regulation 373

I Executive Summary 373

II Details of Main Provisions 375

Appendix 1: Minimum Calorific Requirement 381

CHAPTER 27 Overview of the Forestry Regime 383

I Relevant Laws and Regulations 383

II Categorization of Forest Areas in Indonesia 384

III The Key Definitions for Forest Areas 385

IV Key Licenses for Forest Activities 386

V Carrying on Mining Activities in a Forest Area 386

VI General Description of Rent Use Permits 387

VII Steps Involved in Obtaining a Rent Use Permit and Related Licenses 388

CHAPTER 28 Forest Area Function and Purpose Regulation 405

I Executive Summary 405

II Details of Main Provisions 407

CHAPTER 29 Forest Area Utilization Regulation 419

I Executive Summary 419

II Details of Main Provisions 421

CHAPTER 30 Rent Use Permit Regulation 429

I Executive Summary 429

II Details of Main Provisions 431

CHAPTER 31 Forest License Moratorium Instruction 451

I Executive Summary 451

II Details of Main Provisions 452

CHAPTER 32 Forest Area Utilization for Underground Mining Activities Regulation 455

I Executive Summary 455

II Details of Main Provisions 456

CHAPTER 33 Procedures for Alteration of the Usage and Function of Forest Areas Amendment Regulation 463

I Executive Summary 463

II Details of Main Provisions 464

CHAPTER 34 Usage of Forest Areas Amendment Regulation 467

I Executive Summary 467

II Detail of Main Provisions 468

CHAPTER 35 Second Amendment Regulation re Guidelines for Rent Use of Forest Areas 471

I Executive Summary 471

II Details of Main Provisions 473

Glossary of Defined Terms 481

Index 491