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Overlapping Land Claims : Who's To Blame?

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 The Corruption Eradication Commission (KPK) at one time said that there were some 4000 overlapping land claims, particularly in coal and nickle mining areas. I do not know exactly how many, but I have personally witnessed countless cases involving overlapping mining claims. Too many clients of mine, including state-owned eriterprisesj which I believe, going by my legal reason¬ing, would naturally be immune from such issues, were not: State-owned gold and nickel mining company Aneka Tambarig and state coal compamy Bukit Asam, for instance; have had their lands embroiled in disputes due to overlapping claims. A number of foreign companies are beginning to feel so frustrated by these land grabbing disputes. Some cases have been taken to court and some to international arbitration.

A clearer portrait of this land mining rights issfte stems from a number of causes. First,misuse of power by regents who issue mining business permits or IUP (previously mining authorization) for lands which already have IUPs issued. The classic excuse used by these regents is that since these lands are not being utilized, the region would need income to increase regional revenues, besides stimulating informal sector development. The reaons seem to make sense to some extent. However,in many cases, these"mining business permits" are in fact issued.on land that are either in the process of being utilized, or being prepared for utilization.

Incases where the land has nOt been utilized yet, the question then arises: "Why haven't these lands been exploited?" One needs to bear in mind that according to Law No. 4/2009 on Mineral and Coal Mining, a mining permit consists of exploration and exploitation permits. The explo¬ration permits comprises of general inquiry, exploration and feasibility study. The exploitation permit consists of actual construction activities, mining, processing and refining, as well as transportation and sale (Article, 36). Regents need to examine the stage of an IUP and appraise it proportionately. All permits have their deadlines of expiry. If they have not ex¬pired, they cannot be revoked. However, what is happening now is that new IUPs are being issued on top of existing IUPs that are being used to conduct legitimate activities on the said land.

Perhaps there are permits that have not been utilized albe-it repeated reminders. For such cases, there has tQ be a.clear, transparent and accountable legal mechanism. All permit holders have to be given a chance toutilize their permits be¬fore they are revoked. Regents should also be prepared to face all legal suits in court or in arbitration court, both national and international. All permit issuances and revocations have to be based on law because Indonesia is a country of laws. Second, regents should issue and revoke permits in compliance with the law and should not violate standing legal provisions and principles. As we allknow,based on Law No. 32/2004 oh Regional Governments, regents have the authority to issue and revoke IUPs.

this is the essence and crux of regional autonomy. However, since regions are located within the scope of Indonesian law, regents.also heed to respect all other valid provisions arid existing legal regulations. Yet, in many cases, regents behave like "minor kings" with their fiefdoms, who do not need to bow to the higher state law. Must riot all the regents be subject to the principles of good governance?

We are not turning back the clock, because regional autonomy is "a point of no return". We are not hoping to return to the centralized government system. However, many who are already frustrated 'say that powers granted ,to regents through regional autonomy is spiraling out of control. Several incidents show that it is indeed going top far, but the centralized government system is not the answer; We all have to fix 'governance'

in the regions until the rule of law becomes a basis for ail regional government decrees. Regents should be top law enforcers, not violators.

third, from the political point of view, regency elections are costly and they are rife with money politics; To participate in all election 'stages," can¬didates heed tens or. Even hundreds of billions of rupiah, depending on where the regency is. Do candidates possess such massive amount of funds? Many candidates who do not have suffi¬cient capital finally end up pleading to donors who are usually businesspeople. This is when political bartering occurs. Donors invest in candidates with the hope that their investments will later pay off. So, when the elections end and a new regent is elected or the current one is re-elected, all calculations begin and eventually come into-fruition. For sure, the repayment is 'not made m cash, but via issuance of IUPs; including for lands leased to other companies with valid permits. Regents are aware of this, but powerless to refuse the demand of the do¬nors who provided them political capital. This is the political trap that undermines the rule of law. From region to region, we find the same problem plaguing agricultural, mining or even fishery sectors.

It is easy to say that laws must be enforced. However it can¬not be done if police, prosecutors, courts and advocates col¬lude with one another and validate the wrong. The central gov¬ernment should not throw in the towel either by saying that it is all because of regional autonomy. The central government, first and foremost, has the responsibility to stamp put this out¬break of overlapping land claims. Do not let this issue develop into a ticking time bomb that will harm us all.


Indonesia : Report to Chart Challenges Country Faces In Attracting Investors

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Oxford Business Group teams up with Lubis Santosa and Maramis for 2013 publication

Indonesia, XX July 2012: The steps Indonesia is taking to create a transparent and stable business environment as it looks to attract investors for its major infrastructure projects will be explored in a forthcoming report to be published by the global publishing, research and consultancy firm Oxford Business Group (OBG).

The Report: Indonesia 2013, which marks OBG's sixth publication on the country, will provide in-depth analysis of the country's plans to drive forward a policy of decentralisation by handing a greater role to regional governors across the provinces. It will also contain a detailed, sector-by-sector guide for foreign investors, alongside a wide range of interviews with the most prominent political, economic and business leaders.

OBG has signed an agreement with Lubis Santosa and Maramis (formerly Lubis Santosa and Maulana) to provide support for legal services for its new publication produced with research assistance from BKPM, the Indonesian Chamber of Commerce & Industry (KADIN), Lubis Santosa & Maramis and Pricewaterhouse Coopers (PWC). The legal firm will provide key analysis and data for the publication's Law Chapter.

Lubis Santosa and Maramis provides a range of services across the legal fields, covering Corporate and Commercial law, Intellectual Property and Dispute Resolution. Its clients include multinational corporations, state-owned enterprises and governmental agencies and institutions.

OBG's Regional Editor Paulius Kuncinas said he expected the Group's forthcoming report to look in detail at how policy-makers would address key legal issues which still needed clarification, such as the laws protecting foreign investor interests in Indonesia. "This is particularly true with regards to infrastructure which requires a long-term investment horizon and confidence in the durability of a favourable legal environment," he said.

OBG's Country Director María Meroño said she was delighted that Lubis Santosa and Maramis would be contributing once again to the Group's publication on Indonesia. "Lubis Santosa and Maramis's experts have an in-depth understanding of how Indonesia's legal framework is evolving against a backdrop of rising investor interest," she said. "It is a pleasure to be benefiting from their expertise as we begin the research process for The Report: Indonesia 2013."

Senior partner at Lubis Santosa and Maramis, Todung Mulya Lubis, added that Indonesia's massive infrastructure development, which is expected to be a primary driver of economic growth, heightened the need to ensure international investors were provided with reliable and relevant data.

"Oxford Business Group's reports on emerging economies are well established as market leaders among the global business community," he said. "I look forward to working with the Group's team to explore Indonesia's changing legal landscape at this important juncture in the country's development and furnishing business leaders with the information they need to make their investment decisions."

The Report: Indonesia 2013 will be a vital guide to the many facets of the country, including its macroeconomics, infrastructure, banking and other sectoral developments. It will be available in print or online.

About Oxford Business Group

Oxford Business Group (OBG) is a global publishing, research and consultancy firm, which publishes economic intelligence on the markets of Asia, the Middle East, Africa, and Latin America. Through its range of print and online products, OBG offers comprehensive and accurate analysis of macroeconomic and sectoral developments, including banking, capital markets, insurance, energy, transport, industry and telecoms. The Report: Indonesia 2013 is produced with research assistance from BKPM, the Indonesian Chamber of Commerce & Industry (KADIN), Lubis Santosa & Maramis and Pricewaterhouse Coopers (PWC).

The critically acclaimed economic and business reports have become the leading source of business intelligence on developing countries in the regions they cover. OBG's online economic briefings provide up-to-date in-depth analysis on the issues that matter for tens of thousands of subscribers worldwide. OBG's consultancy arm offers tailor-made market intelligence and advice to firms currently operating in these markets and those looking to enter them.

For more information please contact:

Oxford Business Group, Dubai, PO Box 502 659, Dubai, UAE

Kate Taylor, PR Manager

Phone: +971 44 264 642

E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Improving protectionism to address economic crisis

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Lately, Indonesians have shown a stronger and more apparent protectionist attitude. In this case, it is interesting to see how some politicians purposefully use this for. their own goals, which might not be necessarily good fromthe perspective of national interests.

There is one question which also serves as a criticism that has surfaced lately. Why doe's Indonesia import salt, rice and fruit when it has expansive land and oceans that are able to be utilized? 

No one can deny that Indonesian lands and oceans, are vast and that in theory, Indonesia should be able to produce enough rice, fruits and salt for its people at affordable prices. But the reality begs to differ.

A number of agricultural products and those from the sea are not produced in sufficient supply and even, if they are, their price will exceed the global price. This has caused decision makers to face unwanted consequences.

As an illustration, does the government import rice when there is, or when there is predicted to. be a shortage in supply?

Should the decision makers not meet the shortage by importing rice it is possible the domestic price of rice would soar up, which would make farmers in certain areas (in rice barn area) prosper, and yet at the same time, the rice consumers would suffer.

On the other hand, imports ;make the price more stable or evqiiiower so the consumers are "safe" but at the same time, the farmers especially surplus farmers, would be reduced of their welfare or even pressured. The same thing goes for salt, fruits and some other products.

The flood of imported products, especially from China, has reached a level where some of society has demanded an end to imported products altogether.

This situation is used by some politicians by making statements that sounded like they are defending the pubic interest, but they actually were not.

If Indonesia suffers from a supply shortage. then what we need to do is meet that shortage. It would be better if the additional supply came from the local farmers The question is: Why is domestic supply inad equate in terms of the price and the quality?

Blaming imports without understanding the problem correctly would only cause further harm to Indonesia.

Moreover, economic development in developed countries will cause the sensitivity of these countries to increase. This will make it easier for these countries to have their revenge.
Economists usually agree that, when the economy is developing slowly or even, shrinking, protectionist attitudes will be stronger and more apparent

The economic crises involving a number of developed countries,such as USA and some European countries should not be taken lightly. Anyone would be wary of this change, which is slowly taking effect in America'and Europe. 

This is the first time in history that y people of these developed countries are blaming the coriomic system or the business system applied in their countries.

What we need to pay attention to how prominent the ego of the society in certain countries is when their level of prosperity has fallen. it is very surprising to find the public opinion that they are unwillng to help another country if they have to sacrifice for it.

On the other hand, it is safe to conclude based on the crises in Europe and USA that rich people tend to take it hard when they have to face the reality that they have become poor.

What is happening in Greece is the people are against the reductio of budget expenditures, even though it is needed to overcome the crisis. The consequence for acountry with a debt above 150 percent of its GNP and public saving of 4 percent of its GNP, but refusing austerity measures is quite imaginable.

We also need to pay close attention to the development in the US. Up until now, America is one of Indonesia's main partners in the economic sector.

Indonesia's exports and imports mostly go to and from the US. On the contrary,American exports and imports to Indonesia are only a very small part of the aforementioned country's trade.

Watching the development and condition in the US, it is safe to say that it will take a long time and certain actions to overcome the economic crisis, suppress the unemployment rate and heal the economy in the US and Europe. 

One of the "diseases" in America's economy since a few years ago has been the continuous deficit in its trade balance along with the deficit in budget. America keeps on suffering deficit iri its trade with Indonesia, which in 2010 almost reached US$5 million.

It can be predicted that America will try hard to balance its trade with many countries in the world, including Indonesia. For this purpose, the US will try to eliminate barriers in improving its exports.
Since a few months ago, two US ' states Washington and Lousiana have implemented a law stipulating these two states return all imported goods from any country should they be found that the manufacturers were using illegal software in the production process.

This law is called "Unfair Competition Act" (UCA). The law is not a US federal law, but exporters from other, countries are required to be more careful in getting around this newly-implemented law. Exporters may not be the ones manufacturing the products they are exporting.
Therefore, the impacts would be expansive if the products were found to have violated this law.  

Statistic shows Seattle, which is located .in Washington State is, the seventh biggest port in the US and ia an entrance for most products imported from Asia.

A policy relating to "industrial property right security" with certain economic activity is nothing new in the US. Business Software Alliance (BSA) released in August 2011 and based on research conducted in 2010, placed Indonesia in the 11th position with the percentage as high as 87 percent.

This means that out of 100 computers installed with software, about 87 of them are installed, with unlicensed software. This was a 1 percent increase from 86 percent in 2009.

Producers who are using pirated software in their manufacturing process generally rely on cheap products with lower prices than the market price.

This is because they could gain il-legal and unfair benefits which potentially harm other manufacturers in their own country.

With this position, Indonesia could probably well be the target of the law implemented in these two US states. In that kind of situation, the government apparently cannot just sit around and do nothing. 

Decision makers in this country are certainly aware that piracy is one of the arch-enemies of innovation. Participating in the war against piracy is the correct policy. One way of doing this is through education or providing information for the public.

Watching developments in these countries, it is safe to say that die economy crises will increase the, protectionist attitude on the one hand, and trigger many actions to fight barriers for fair trade on the other. To avoid negative impacts, Indonesia needs to make some adjustments.

Jakarta Post, December 12' 2011

Pande Radja Silalahi - The writer is an economic researcher and Consultant at LSM

Indonesia Free Editor Of Playboy From Prison - Eric Bellman

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Asia Wall Street Journal, June 27'2011

JAKARTA _ The former editor of the Indonesian version of Playboy magazine was released from prison after the Supreme Court overturned his indecency, conviction in a case that drew widespread debate over public morals in the country.

Erwin Arnada was sentenced to two years last October for picking and publishing photos of scantily clad women. While the photos were tame compared to those published in some other local magazines, Playboy's big international profile made it a lightning1 rod for the wrath of hard-line groups in Indonesia, the world's biggest Muslim-majority nation.

Human-rights groups, mean while have accused the government of using cases such as Mr. Arnada's to curry favor with strict Muslims, while failing to protect freedom of the press.

The reasons for Mr. Arnada's acquittal weren't immediately clear. "My release is evidence that freedom of speech is respected" in Indonesia, Mr. Arnada said to a reporter as he was set free Friday.

The debate over the magazine and the fate of its editor has illustrated the tension between Indonesia’s many moderate Muslim residents and an influential core of conservatives who back stricter religious laws here.

While the Southeast Asian nation of 240 million has long been seen as moderate and largely secular, a tiny and sometimes violent minority of hard-liners sometimes seeks to impose its views, at times rattling investors.  
Regular demonstrations and political pressure from conservative Muslim groups against what they see as Western, influences in Indonesia have brought them occasional victories in local governments and in the courts. Earlier this year, one of Indonesia's biggest pop stars was sentenced to 3 1/2 years for making sex tapes that also triggered a large public debate.

From the moment Playboy magazine started publishing in 2006, the editor and his staff were targeted by radical Islamists, who threatened his family, trashed his office and reported him to authorities.

Playboy Indonesia relocated its editorial offices and staff to the tourist-resort island of Bali in hopes of avoiding more trouble, but eventually had to shut down before it had been published for a year. Prosecutors agreed to take Mr. Arnada to court, drawing criticism from rights groups that believe the country's laws against indecency and pornography were too strict and were being applied in a capricious manner.

"We need to review the law, which is being used to accommodate political interests rather than addressing what people need" in Indonesia," said Hendardi, executive director of Setara Institute, an Indonesian human-rights group. Like many Indonesians, he goes by only one name.

The acquittal is "a symbol of respect of the state toward freedom of speech," he said.

Yayu Yuniar

contributed to this article.

Indonesia Finally Withdraws Komodo From N7WN

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The Komodo National Park was finally withdrawn from the selection of the ‘New Seven Wonder of Nature’, because of the obscurity of the organizing committee...

Towards the Indonesian Independence Day celebration, the government through the Ministry of Culture and Tourism (Kemenbudpar, Ind.) has withdrawn the Komodo National Park (KNP) as the finalist of the New Seven Wonders of Nature (N7WN) because of the non-transparent, unprofessional and inconsistency of the New Seven Wonders Foundation organizing committee towards the event.

“We’ve broken up the relations; I have to defend this country,” said Indonesian Minister of Culture and Tourism, Jero Wacik at the Ministry of Culture and Tourism, on Monday (8/15).
According to him, when the New Seven Wonders Foundation would like to vote for some new wonders across the globe, Indonesia was interested to join because the idea seemed very good. Indonesia, through Kemenbudpar has registered three places at once, that were the Lake Toba, the Krakatau, and the Komodo National Park (KNP).

The registration fee was USD 199 and the one that has passed was only the KNP. KNP has made it into the 28 nominations by setting aside 440 nominees from 220 countries. Assessments were based on the online voting results. Above the achievements, the Ministry of Cultural and Tourism has questioned of how much the KNP has gotten support. Unfortunately, the question did not get a response from the committee, yet they have continued to promote the KNP as a nominee of N7WN.

To the extent, they have even mobilized various circles to support the KNP to be one of the N7WN. In fact, state officials have also provided support.

“Mr. Vice President himself has provided direct support from the island of Komodo,” said Wacik. N7WN announcement itself will take place on November 11, 2011. During the process towards the final stage, the Ministry has always monitored the progress.

They have always asked how much support that the KNP has got. Understandably, from 28 nominees they will be squeezed into 7, which entitled to the ‘New Seven Wonders of Nature’. But, they still haven’t got a response from the organizing committee. Suspicions began to appear and they tried to come to the committee’s adress in Switzerland. The result was quite surprising; it turned out to be a museum. The Ministry then sent an email to the committee. The email finally got an answer, but there were indications of peculiarities because the committee’s domain was of the UK instead of Switzerland.

Not only that, other irregularities started sticking when the committee selected Indonesia as the host for the final event. The Ministry of Culture and Tourism as the official supporting committee was required to deposit USD 10 million, plus USD 35 million for the venue. The total expenditure was about USD 45 million or equivalent to IDR 400 billion.

“I expressed my regards to your appointment, but we will remain involved until the final, though we are not to be the host of the final event,” said Wacik.
As a result, KNP was dropped from one of the N7WN finalists. Pros and cons started popping up, and the Ministry then appointed their lawyer from Lubis, Santosa & Maulana Law Firm for the incident. “That is particularly violation of universal law,” said the representative of the Lubis, Santosa and Maulana Law Firm, Julius Singara. Julius said, the legal steps taken will be first discussed with the Ministry.

“We will consider first, whether to wait on this obscure committee or else. Because, it will take a lot of funds due to their address that is in Switzerland. Better use the funds for our cultural promotion,” said Julius.

Meanwhile Wacik said, regarding the legal issues, they will be submitted to the Law Firm headed by the well-known lawyer, Todung Mulya Lubis.

In addition to Indonesia, several countries have also declared their official resignations, such as the Maldives. In the opinion of the Marketing Director of the Ministry of Culture and Tourism, Sapta Nirwandar, what have the committee done was an act of arbitrary. The Chairman of MURI (Indonesian Record Museum, ed.) Jaya Suprana confirmed, the committee’s act was an act of utilizing the awards industry.

“We don’t need to be dazzled, and always get oriented to the foreign institution. Better we respect our own people, so for that, MURI declares the KNP is one of the wonders of the world that is second to none,” said Jaya Suprana.

Although has been withdrawn from the N7WN program, the KNP would still be promoted. In fact, it already has a brand of The New Real Wonder of the World. KNP itself, since 1991 has received the World Heritage status by UNESCO, the UN official institution. (Sbh) (ms)


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