Uu minerba 4 2009
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UU minerba 2009

UU minerba 2009

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Uu minerba 4 2009 Uu minerba 4 2009 Document Transcript

  • LAW OF THE REPUBLIC OF INDONESIA NUMBER 4 OF YEAR 2009 CONCERNING MINERAL AND COAL MINING THE PRESIDENT OF THE REPUBLIC OF INDONESIA WITH THE BLESSING OF GOD THE ALMIGHTYConsidering: a. that mineral and coal contained in the jurisdiction of mining of Indonesia constitutes non-renewable natural resources as bestowed by God the Almighty which plays an important role in satisfying life necessities of many people, therefore management thereof must be controlled by the State to give real added value for national economy in the efforts to reach a just welfare and prosperity of the people. b. that the business activities of mineral and coal mining are mining business activities other than geothermal, petroleum and natural gas and ground water play a significant role in providing real added value to national economy growth and regional development in a sustainable manner; c. that by considering national and international progress, Law Number 11 of Year 1967 concerning Main Provisions in Mining is not suitable any longer thus an amendment to laws in mineral and coal mining is required which is able to manage and exploit mineral and coal potential independently, reliably, transparently, competitively, efficiently, and environmentally aware, to guarantee a sustainable national development. 1
  • d. that pursuant to considerations as referred to in item 1, item b, and item c, a Law concerning Mineral and Coal Mining needs to be created;In view of: Article 5 clause (1), Article 20 and Article 33 clause (2) and clause (3) of the Constitution of the Republic of Indonesia of Year 1945; With Joint Approval of THE HOUSE OF REPRESENTATIVES OF THE REPUBLIC OF INDONESIA and THE PRESIDENT OF THE REPUBLIC OF INDONESIA HEREBY RESOLVESTo enact: LAW CONCERNING MINERAL AND COAL MINING CHAPTER I GENERAL TERMS Article 1As defined herein:1. Mining shall be part or all phases of activity in the context of research, management, and exploitation of mineral or coal covering general survey, exploration, feasibility study, construction, mining, processing and refining, transportation and sales, and post-mining activities.2. Mineral shall be inorganic compound formed in nature, which has specific physical and chemical properties and arranged crystal structure or combination thereof forming rock, in loose or combined form.3. Coal is a sediment of carbon organic compound formed naturally from remains of plants. 2
  • 4. Mineral Mining shall be mining of a collection of minerals in form of ore or rock, other than geothermal, petroleum and natural gas, and ground water.5. Coal Mining shall be mining of carbon sediment located in the earth, including solid bitumen, turf, and asphalt rock.6. Mining business shall the activities in the context of research, management, and exploitation of mineral or coal covering general survey, exploration, feasibility study, construction, mining, processing and refining, transportation and sales, and post-mining activities.7. Mining Business Permit, hereinafter the Mining Business Permit (Izin Usaha Pertambangan/IUP) shall be the permit to run mining business.8. Exploration Mining Business Permit (IUP Eksplorasi) shall be a business permit granted to execute the activity of genera survey, exploration, and feasibility study.9. Production Operation Mining Business Permit (IUP Operasi Produksi) shall be a business permit granted after completion of Exploration Mining Business Permit (IUP Eksplorasi) to execute the phase of production operation activities. *10. Peoples Mining Permit, hereinafter Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR), shall be the permit to conduct mining business within peoples mining area under limited area and investment size.11. Special Mining Business Permit, hereinafter Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall be the permit to run mining business in the special mining business permit area.12. Exploration Special Mining Business Permit (IUPK Eksplorasi) shall be a business permit granted to execute the phase of activity of general survey, exploration, and feasibility study within the special mining area business permit. 3
  • 13. Production Operation Special Mining Business Permit (IUPK Operasi Produksi) shall be a business permit granted after completion of execution of Exploration Special Mining Business Permit (IUPK Eksplorasi) to to execute the phase of production operation activities in the special mining business permit area.14. General Survey shall be the phase of activities of mining to find regional geology condition and indication of presence of mineralization.15. Exploration shall be the phase of mining business activity to find detailed and precise information about location, shape, dimension, distribution, quality and measured of materials, and information concerning social condition and the environment.16. Feasibility study shall be the phase of mining business activities to find detailed information about all related aspects to find economy and technical feasibility of mining business, including analysis about environment impact and post-mining planning.17. Production Operation shall be the phase of mining business activities covering construction, mining, processing, refining, including transportation and sales, and environment impact control facilities conforming to the result of feasibility study.18. Construction shall be mining business activities to execute development of all production operation facilities, including control of environment impact.19. Mining shall be part of mining business activities to produce mineral and /or coal and their trace minerals.20. Processing and refining shall be mining business activities to improve the quality of mineral and /or coal and to use and gain trace minerals. 4
  • 21. Transportation shall be a mining business activity to move minerals and /or coal from the mine site and or processing and refining site to delivery site.22. Sales shall be a mining business activity to sell the product of mineral or coal mining.23. Business Entity shall be every legal entity running business in mining established based on Indonesian law and is domiciled within the territory of the Unitary State of the Republic of Indonesia.24. Mining Service shall be a support service relate do the mining business activities.25. Environment Impact Statement (AMDAL), hereinafter AMDAL, shall be a study about major and significant impact of a business and /or activity planned on an environment required for decision making process about undertaking of a business and /or activity.26. Reclamation shall be an activity conducted during the phase of mining business to arrange, recover, and fix environment and ecosystem quality to allow them to function again according to their purpose.27. Post mining activity, hereinafter post mining, shall be a planned, systematic, and sustainable activity after the end of part or all of mining business activities to recover natural environment and social functions according to local conditions at all mining areas.28. Community Empowerment shall be an effort to improve the peoples capability, both individually or collectively, to improve their life quality.29. Mining Area, herein after Mining Area (Wilayah Pertambangan /WP) shall be areas which have mineral and /or coal potential which are not bound by government administrative boundary which constitutes a part of national space planning. 5
  • 30. Mining Business Area, hereinafter Mining Business Area (Wilayah Usaha Pertambangan /WUP) shall be a part of the Mining Area (Wilayah Pertambangan /WP) which has obtained availability of data, potential, and /or geology information.31. Mining Business Permit Area, hereinafter Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) shall be areas granted for the holder of Mining Business Permit (Izin Usaha Pertambangan/IUP).32. Peoples Mining Area, hereinafter Peoples Mining Area (Wilayah Pertambangan Rakyat /WPR) shall be part of the Mining Area (Wilayah Pertambangan /WP) where peoples mining business activities take place.33. State Reserve Area, hereinafter State Reserve Area (Wilayah Pencadangan Negara /WPN) shall be part of Mining Area (Wilayah Pertambangan /WP) reserved for national strategic interest.34. Special Mining Business Area, hereinafter Special Mining Business Area (Wilayah Usaha Pertambangan Khusus /WUPK) shall be part of Mining Area (Wilayah Pertambangan /WP) which can be exploited.35. Special Mining Business Permit Area, hereinafter Special Mining Business Permit Area (Wilayah Izin Usaha Pertambangan Khusus/WIUPK) shall be areas granted for the holder of Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK).36. The Central Government, hereinafter the Government, shall be the President of the Republic of Indonesia who holds the power of Governance of the State of the Republic of Indonesia as referred to in the Constitution of the State of the Republic of Indonesia of Year 1945. 6
  • 37. The regional government shall be the governor, bupati (regent), or mayor, and local apparatus as components of administration of regional governance.38. The minister shall be the minister who administers government affairs in the sector of mineral and coal mining. CHAPTER II PRINCIPLE AND OBJECTIVE Article 2Mineral and /oar coal mining shall be managed under the principle of:a. benefit, fairness, and balance;b. partiality to national interest;c. participation, transparency, and accountability;d. sustainability and environmentally-aware. Article 3In the context of support of sustainable national development, the objectives ofmanagement of mineral an coal shall be:a. to guarantee effectiveness of execution and control of mining business activities which are effective, productive, and competitive;b. to guarantee the benefit of mineral and coal mining in a sustainable and environmentally aware manner;c. . to guarantee availability of mineral and coal as raw materials and /or source of energy for domestic needs;d. to support and develop national capability to be more competitive at national, regional, and international levels; 7
  • e. to increase the income of local, regional community, and the state, and to create job opportunities for optimum benefits of the people welfare; andf. to guarantee legal certainty in administering of mineral and coal mining business activities. CHAPTER III POSSESSION OF MINERAL AND COAL MINING Article 4(1) Mineral and coal as non-renewable natural resource is a national asset possessed by the state for optimum benefit of the peoples welfare.(2) Possession of mineral and coal by the state as referred to in clause (1) shall be under administering by the Government and /or regional government. Article 5(1) For national interest, the Government, after a consult with the House of Representatives of the Republic of Indonesia, may stipulate a policy of prioritizing mineral and /or coal for domestic interest.(2) The national interest as referred to in clause (1) can be made by control of production and export.(3) In running the control as referred to in clause (2) the Government holds the authority to define production amount of each commodity per year for each province.(4) The regional government shall comply with the defined amount stipulated by the Government as referred to in clause (3). 8
  • (5) Further provisions concerning prioritizing of mineral and /or coal for domestic interest as referred to in clause (1) and control of production and export as referred to in clause (2) and clause (3) shall be regulated in a government regulation. CHAPTER IV AUTHORITY IN MANAGEMENT OF MINERAL AND COAL MINING Article 6(1) The Governments Authority in management of mineral and coal mining among else shall be: a. stipulation of national policy; c. creation of laws; c. stipulation of national standard, guidance, and criteria; d. stipulation of national mineral and coal mining permit system; e. stipulation of Mining Area (Wilayah Pertambangan /WP) which is made after a coordination with the local government and consult with the House of Representatives of the Republic of Indonesia; f. grant of Mining Business Permit (Izin Usaha Pertambangan/IUP), assistance, settlement of peoples conflict, and supervision of mining business which location is crossing province and /or ocean areas exceeding 12 (twelve) miles from the shore line; g. grant of Mining Business Permit (Izin Usaha Pertambangan/IUP), assistance, settlement of peoples conflict, and supervision of mining business which mining location is within province and /or ocean areas exceeding 12 (twelve) miles from the shore line; 9
  • h. grant of Mining Business Permit (Izin Usaha Pertambangan/IUP), assistance, settlement of peoples conflict, and supervision of production operation mining business which direct environment impact is crossing province and /or ocean areas exceeding 12 (twelve) miles from the shore line;i. grant of Exploration Special Mining Business Permit (IUPK Eksplorasi), and Production Operation Special Mining Business Permit (IUPK Operasi Produksi);j. evaluation of Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) issued by the regional government which has caused environment damage and did not apply good mining rules;k. stipulation of production, marketing, utilization, and conservation policies;l. stipulation of collaboration, partnership, and peoples empowerment policies;m. formulation and stipulation of non-tax state income from mineral and coal mining business revenue;n. assistance and supervision of administering of mineral and coal mining management run by the regional government;o. assistance and supervision of formulation of regional regulation in mining;p. inventory, investigation, and research and exploration in the context to acquire data and information on mineral and coal as the materials to devise (Wilayah Usaha Pertambangan Khusus /WUPK) and State Reserve Area (Wilayah Pencadangan Negara /WPN);q. management of geological information, mineral resource and coal potential information, and mining information at national level;r. assistance and supervision on post mining land reclamation;s. stipulation of national level mineral and coal resource balance; 10
  • t. development and improvement of added value of mining business activities; andu. improvement of the capability of the apparatus of the Government, provincial government, and regency (kabupaten) /municipality government in administering of mining business management. Article 7(1) The regional governments authority in management of mineral and coal mining among else shall be: a. creation of regional laws; b. grant of Mining Business Permit (Izin Usaha Pertambangan/IUP), assistance, settlement of peoples conflict, and supervision of mining business which location is crossing kabupaten (regency)/municipality and /or ocean areas in 4 (four) miles to 12 (twelve) miles; c. grant of Mining Business Permit (Izin Usaha Pertambangan/IUP), assistance, settlement of peoples conflict, and supervision of production operation mining business which activity is crossing kabupaten (regency)/municipality and /or ocean areas in 4 (four) miles to 12 (twelve) miles; d. grant of Mining Business Permit (Izin Usaha Pertambangan/IUP), assistance, settlement of peoples conflict, and supervision of mining business which direct environment impact is crossing kabupaten (regency)/municipality and /or ocean areas in 4 (four) miles to 12 (twelve) miles e. inventory, investigation, and research and exploration in the context to acquire data and information on mineral and coal conforming to its authority; f. management of geological information, mineral and coal resource potential information, and mining information at regional /local level; 11
  • g. devise of mineral and coal resource balance at provincial region/ area level; h. development and improvement of added value of mining business activities in the province; i. development and improvement of peoples participation in the mining business by taking into account preservation of the environment; j. coordinating the permitting and supervision of utilization of explosives in mining area in accordance with their authority; k. delivering information concerning the result of inventory, general survey, and research and exploration to the Minister and regent (bupati) /mayor; l. delivering information concerning the result of production, domestic and export sales to the Minister and regent (bupati) /mayor; m. assistance and supervision on post mining land reclamation; n improvement of the capability of the apparatus of the provincial government and regency (kabupaten) /municipality government in administering of mining business management.(2) The provincial governments authority as referred to in clause (1) shall be exercised pursuant to the provisions of laws and legislations. Article 8(1) The authority of the regency /municipality government in management of mineral and coal mining among else shall be: a. creation of regional laws; b. grant of Mining Business Permit (Izin Usaha Pertambangan/IUP), Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR) assistance, settlement of peoples 12
  • conflict, and supervision of mining business within the area of the regency (kabupaten) /municipality and /or ocean area within 4 (four) miles;c. grant of Mining Business Permit (Izin Usaha Pertambangan/IUP), Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR) assistance, settlement of peoples conflict, and supervision of production operation mining business which activity is located within the territory of the regency (kabupaten) /municipality and /or ocean area within 4 (four) miles;d. inventory, investigation and research, and exploration in the context to acquire data and information on mineral and coal;e. management of geological information, mineral and coal resource potential information, and mining information at kabupaten (regency) /municipality level;f. a devise of mineral and coal resource balance in the kabupaten (regency) /municipality level;g. development and empowerment of the local people in mining business by taking into account preservation of the environment;h. development and improvement of added value and benefit of mining business activities optimally;i. delivery of information resulting from inventory, general survey, and research, and exploration and exploitation to the Minister and the governor;j delivering information concerning the result of production, domestic and export sales to the Minister and the governor;k. assistance and supervision on post mining land reclamation; and 13
  • l. improvement of the capability of the apparatus of the regency (kabupaten) /municipality government in administering of mining business management.(2) The authority of the kabupaten (regency) /municipality government as referred to in clause (1) shall be exercised pursuant to the provisions of laws and legislations. CHAPTER V MINING AREA Section One General Article 9(1) The Mining Area (Wilayah Pertambangan /WP) as a part of national space planning shall become a base for stipulation of mining activities.(2) The Mining Area (Wilayah Pertambangan /WP) as referred to in clause (1) shall be stipulated by the Government after a coordination with the regional government and a consult with the House of Representatives of the Republic of Indonesia; Article 10Stipulation of Mining Area (Wilayah Pertambangan /WP) as referred to in clause Article(2) shall be executed:a. in a transparent, participative, and responsible manner;b. in an integrated manner by considering opinions from related government institutions, the people, and by considering the aspects of ecology, economy, and social culture, and has environment insight; andc. by considering aspiration of the region. Article 11The government and the regional government shall conduct survey and research ofmining in the context of preparation of Mining Area (Wilayah Pertambangan /WP). 14
  • Article 12Further provisions concerning limit, size, and mechanism of stipulation of WP asreferred to in Article 9, Article 10, and Article 11 shall be regulated under agovernment regulation. Article 13Mining Area (Wilayah Pertambangan /WP) comprises of:a. (Wilayah Usaha Pertambangan Khusus /WUPK);b. Peoples Mining Area (Wilayah Pertambangan Rakyat /WPR); andc. State Reserve Area (Wilayah Pencadangan Negara /WPN). Section Two Mining Business Area Article 14(1) Stipulation of a (Wilayah Usaha Pertambangan Khusus /WUPK) shall be made by the Government after a consult with the regional government and submitted in writing to the House of Representatives of the Republic of Indonesia.(2) The coordination as referred to in clause (1) shall be conducted by the respective regional government conforming to data and information the Government and the local government have in hand. Article 15The Government may delegate part of its authority in stipulation of a Mining Area(Wilayah Pertambangan /WP) as referred to in Article 14 clause (1) to the provincialgovernment in accordance with the provisions of laws and legislations. Article 16 15
  • One (Wilayah Usaha Pertambangan Khusus /WUPK) shall consist of 1 (one) ore moreSpecial Mining Business Permit Areas (Wilayah Izin Usaha PertambanganKhusus/WIUPK) which location is crossing territory of the province, crossing territoryof the kabupaten (regency) /municipality, and /or within 1 (one) kabupaten (regency)/municipality area. Article 17Size and limit of Special Mining Business Permit Area (Wilayah Izin Usaha PertambanganKhusus/WIUPK) for metal and coal materials shall be stipulated by the Governmentunder coordination with the regional government based on criteria the Governmentpossesses. Article 18The criteria to stipulate 1 (one) or more Special Mining Business Permit Areas (WilayahIzin Usaha Pertambangan Khusus/WIUPK) in 1 (one) Mining Business Area (WilayahUsaha Pertambangan /WUP) shall be as follows:a. geographical location;b. conservation rules;c. environment protection bearing capacity;d. optimization of mineral and /or coal resource; ande. population density level. Article 19Further provisions concerning procedure of stipulation of boundary and size of aMining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) as referred to inArticle 17 shall be regulated under a government regulation. Section Three 16
  • Peoples Mining Area (Wilayah Pertambangan Rakyat /WPR) Article 20Peoples mining activities shall be executed in a Peoples Mining Area (WilayahPertambangan Rakyat /WPR). Article 21The Peoples Mining Area (Wilayah Pertambangan Rakyat /WPR) as referred to in Article20 shall be stipulated by the bupati (regent) /mayor after a consult with the LegislativeCouncil of the kabupaten (regency) /municipality (Dewan Perwakilan Rakyat DaerahKabupaten /Kota). Article 22The criteria for stipulation of a Peoples Mining Area (Wilayah Pertambangan Rakyat/WPR) shall be as follows:a. it has a secondary mineral reserve located in a river and /between river banks;b. it has metal or coal primary reserve at the depth of a maximum of 25 (twenty-five) meters;c. sedimentation of terrace, flood plain, and sedimentation of ancient river;d. maximum Peoples Mining Area (Wilayah Pertambangan Rakyat /WPR) size shall be 25 (twenty-five) hectares;e. stating type of commodity to mine; and /orf. it is an area or location of peoples mine activity which has been exploited for at least 15 (fifteen) years. Article 23 17
  • In stipulation of a Peoples Mining Area (Wilayah Pertambangan Rakyat /WPR) asreferred to in Article 21, the bupati (regent) /mayor shall make an announcementconcerning the Peoples Mining Area (Wilayah Pertambangan Rakyat /WPR) plan to thepublic openly. Article 24The location or area of Peoples Mining Area (Wilayah Pertambangan Rakyat /WPR)which has been exploited but not yet stipulated as a Peoples Mining Area (WilayahPertambangan Rakyat /WPR) shall be given priority to be stipulated as a Peoples MiningArea (Wilayah Pertambangan Rakyat /WPR). Article 25Further provisions concerning guidance, procedure, and stipulation of a PeoplesMining Area (Wilayah Pertambangan Rakyat /WPR) as referred to in Article 21 andArticle 23 shall be regulated under a government regulation.Further provisions concerning criteria and mechanism of stipulation of a PeoplesMining Area (Wilayah Pertambangan Rakyat /WPR) as referred to in Article 22 andArticle 23 shall be regulated under a regulation of the kabupaten (regency)/municipality. Section Four State Reserve Area Article 27(1) For national strategic interest, the Government, with approval of the House of Representatives of the Republic of Indonesia and by considering local aspiration and stipulating the State Reserve Area (Wilayah Pencadangan Negara /WPN) as an 18
  • area reserved for specific commodity and conservation area in the context of maintaining ecosystem and environment balance.(2) Part area size of a State Reserve Area (Wilayah Pencadangan Negara /WPN) stipulated for a specific commodity as referred to in clause (1) may be exploited after an approval from the House of the Representatives of the Republic of Indonesia.(3) A time limit for the State Reserve Area (Wilayah Pencadangan Negara /WPN) stipulated for conservation as referred to in clause (1) is stipulated with an approval from the House of the Representatives of the Republic of Indonesia.(4) The area which will be exploited as referred to in clause (2) and clause (3) will change status into a Special Mining Business Area (Wilayah Usaha Pertambangan Khusus /WUPK). Article 28The change of status of a State Reserve Area (Wilayah Pencadangan Negara /WPN) asreferred to in Article 27 clause (2), clause (3), and clause (4) into a Special MiningBusiness Area (Wilayah Usaha Pertambangan Khusus /WUPK) may be made byconsidering:a. supply of domestic industry and energy raw materials;b. source of national foreign exchange;c. regional condition based on limitation of infrastructure and facilities;d. has a potential to develop as an economy growth center;e. environment bearing capacity; and /orf. utilization of high technology and big capital investment. Article 29 19
  • (1) The Special Mining Business Area (Wilayah Usaha Pertambangan Khusus /WUPK) as referred to in Article 24 clause (4) to exploit shall be stipulated by the Government after a coordination with the regional government.(2) Execution of mining business activities in the Special Mining Business Area (Wilayah Usaha Pertambangan Khusus /WUPK) as referred to in clause (1) shall be conducted in form of a Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK). Article 30One Special Mining Business Area (Wilayah Usaha Pertambangan Khusus /WUPK) shallconsist of 1 (one) ore more Special Mining Business Permit Areas (Wilayah Izin UsahaPertambangan Khusus/WIUPK) which location is crossing territory of the province,crossing territory of the kabupaten (regency) /municipality, and /or within 1 (one)kabupaten (regency) /municipality area. Article 31Size and limit of the Special Mining Business Permit Area (Wilayah Izin UsahaPertambangan Khusus/WIUPK) for metal and coal materials shall be stipulated by theGovernment under coordination with the regional government based on criteria andinformation the Government possesses. Article 32The criteria to stipulate 1 (one) or more Special Mining Business Permit Areas (WilayahIzin Usaha Pertambangan Khusus/WIUPK) in 1 (one) Special Mining Business Area(Wilayah Usaha Pertambangan Khusus /WUPK) shall be as follows:a. geographical location;b. conservation rules; 20
  • c. environment protection bearing capacity;d. optimization of mineral and /or coal resource; ande. population density level. Article 33Further provisions concerning procedure of stipulation of size and bondary of a SpecialMining Business Permit Area (Wilayah Izin Usaha Pertambangan Khusus/WIUPK) asreferred to in Article 31 and Article 32 shall be regulated under a governmentregulation. CHAPTER VI MINING BUSINESS Article 34(1) Mining business is categorized into: a. mineral mining; and b. coal mining(2) The mineral mining as referred to in clause (1) item a is categorized into: a. radioactive mineral mining; b. metal mineral mining; c. non-metal mineral mining; and d. rock mining.(3) Further provisions concerning stipulation of a mine commodity into a mineral mining group as referred to in clause (2) shall be regulated under a government regulation. Article 35The mining business as referred to in Article 34 shall be executed in form of: 21
  • a. Mining Business Permit (Izin Usaha Pertambangan/IUP);b. Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR); danc. Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK). CHAPTER VII MINING BUSINESS PERMIT (IZIN USAHA PERTAMBANGAN/IUP) Section One General Article 36(1) Mining Business Permit (Izin Usaha Pertambangan/IUP) comprises of two phases: a. Exploration Mining Business Permit (IUP Eksplorasi) covering the activity of general survey, exploration, and feasibility study; b. Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) covering the activities of construction, mining, processing, and refining, and transportation and sales.(2) The holder of the Exploration Mining Business Permit (IUP Eksplorasi) and Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) may run some of or all activities as referred to in clause (1). Article 37The Mining Business Permit (Izin Usaha Pertambangan/IUP) is granted by:a. the bupati /mayor if the Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) is located within a territory of a kabupaten (regency) /municipality;b. the governor, if the Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) is located crossing the territories of the kabupaten /municipality in 1 (one) 22
  • province after a recommendation from the respective bupati (regent) /mayor conforming to the provisions of laws and legislations; andc. b. the Minister, if the Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) is located crossing the territories of the province after a recommendation from the respective governor and bupati (regent) /mayor conforming to the provisions of laws and legislations. Article 38The Mining Business Permit (Izin Usaha Pertambangan/IUP) can be awarded to:a. a business entity;b. a cooperative; andc. an individual. Article 39(1) The Exploration Mining Business Permit (IUP Eksplorasi) as referred to in Article 36 clause (1) item a shall include at least: a. name of the company; b. location and size of area; c. general spatial planning; d. surety bond; e. investment capital; f. time extension of an activity phase; g. rights and obligations of the holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP); h. duration of validity of activity phase; j. type of business awarded; 23
  • j. plan for development and empowerment of the community in the vicinity of the mining area; k. taxation; l. settlement of dispute; m. fixed fee and exploration fee; and n. AMDAL (Environment Impact Statement).(2) The Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) as referred to in Article 36 clause (1) item a shall include at least: a. name of the company; b. size of area; c. location of mining; d. location of processing and refining; e. transportation and sales; f. investment capital; g. duration of validity of the Mining Business Permit (Izin Usaha Pertambangan/IUP); h. duration of activity phase; i. settlement of land issues; j. the environment including post mining reclamation; k. reclamation and post mining bond fund; l. Extension of the Mining Business Permit (Izin Usaha Pertambangan/IUP); m. rights and obligations of the holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP); 24
  • n. plan for development and empowerment of the community in the vicinity of the mining area; o. taxation; p. non tax state income comprises of fixed fee and production fee; q. settlement of dispute; r. work safety and health; s. conservation of mineral or coal; t. utilization of domestic goods and services; u. application of good economy and mining engineering rules; v. improvement of Indonesian workers; w. management of mineral or coal data; and x. mastery, development, and implementation of mineral or coal mining technology; Article 40(1) The Mining Business Permit (Izin Usaha Pertambangan/IUP) as referred to in Article 36 clause (1) shall be granted for 1 (one) type of mineral or coal.(2) The holder of a Mining Business Permit (Izin Usaha Pertambangan/IUP) as referred to in clause (1) who discovers other minerals in the managed Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) shall be given priority for exploitation thereof.(3) The holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) who intends to exploit other minerals as referred to in clause (2) shall submit a new Mining Business Permit (Izin Usaha Pertambangan/IUP) proposal to the Minister, the governor, the bupati (regent) /mayor in accordance with their authority. 25
  • (4) The holder of a Mining Business Permit (Izin Usaha Pertambangan/IUP) as referred to in clause (2) may state his /her unwillingness to exploit the other minerals discovered.(5) The holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) who is not willing to exploit the other minerals discovered as referred to in clause (4), shall safeguard the other mineral to prevent utilization by other party.(6) The Mining Business Permit (Izin Usaha Pertambangan/IUP) for the other mineral as referred to in clause (4) and (5) may be granted to another party by the Minister, the governor, and the bupati (regent) /mayor in accordance with their authority.The Mining Business Permit (Izin Usaha Pertambangan/IUP) shall not be used forpurpose other than intended in the grant of the Mining Business Permit (Izin UsahaPertambangan/IUP). Section Two Exploration Mining Business Permit (IUP Eksplorasi) Article 42(1) The Exploration Mining Business Permit (IUP Eksplorasi) for metal mineral mining may be granted for a period of a maximum of 8 (eight) years.(2) The Exploration Mining Business Permit (IUP Eksplorasi) for non metal mineral mining may be granted for a maximum period of 3 (three0 Years and specific non metal mineral may be granted for a maximum period of 7 (seven) years.(3) The Exploration Mining Business Permit (IUP Eksplorasi) for rock mineral mining may be granted for a period of a maximum of 3 (three) years. 26
  • (4) The Exploration Mining Business Permit (IUP Eksplorasi) for coal mineral mining may be granted for a period of a maximum of 7 (seven) years. Article 43(1) In case of the activity of exploration and the activity of feasibility study, the holder of the Exploration Mining Business Permit (IUP Eksplorasi) who obtains excavated mineral or coal shall submit a report to the grantor of the Mining Business Permit (Izin Usaha Pertambangan/IUP).(2) The holder of the Exploration Mining Business Permit (IUP Eksplorasi) intending to sell the mineral or coal as referred to in clause (1) shall propose for a temporary permit to conduct transportation and sales. Article 44The temporary permit as referred to in Article 43 clause (2) shall be granted by theMinister, the governor, and the bupati (regent) /mayor in accordance with theirauthority. Article 45To the excavated mineral or coal as referred to in Article 43, a production fee may beimposed. Section Three Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) Article 46(1) Every holder of a Exploration Mining Business Permit (IUP Eksplorasi) is guaranteed to obtain a Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) as a continuance of his /her mining business activity. 27
  • (2) The Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) may be granted to a business entity, cooperative, or an individual upon the result of bid of a Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) for metal or coal mineral which have obtained data of the result of feasibility study. Article 47(1) The Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) for metal mineral mining may be granted for a maximum period of 20 (twenty) years and may be extended twice, respectively for 10 (ten) years.(2) The Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) for non metal mineral mining may be granted for a maximum period of 10 (ten) years and may be extended twice, respectively for 5 (five) years.(3) The Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) for non specific type of metal mineral mining may be granted for a maximum period of 20 (twenty) years and may be extended twice, respectively for 10 (ten) years. ,(4) The Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) for rock mining may be granted for a maximum period of 5 (five) years and may be extended twice, respectively for 5 (five) years.(5) The Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) for coal mining may be granted for a maximum period of 20 (twenty) years and may be extended twice, respectively for 10 (ten) years. Article 48The Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) isgranted by: 28
  • a. the bupati (regent)/mayor if the location of mining, the location of processing and refining, and seaport is within a territory of a kabupaten (regency) /municipality;b. the governor, if the if the location of mining, the location of processing and refining, and seaport is crossing territories of separate kabupaten (regencies)/municipalities after a recommendation from the respective bupati (regent) /mayor conforming to the provisions of laws and legislations; andc. the MInister, if the if the location of mining, the location of processing and refining, and seaport is in the territory of another province after a recommendation from the respective bupati (regent) /mayor conforming to the provisions of laws and legislations. Article 49Further provisions concerning procedure of grant of Exploration Mining BusinessPermit (IUP Eksplorasi) as referred to in Article 42 and Production Operation MiningBusiness Permit (IUP Operasi Produksi /IUPOP) as referred to in Article 46 shall beregulated under a government regulation. Section Four Mineral Mining Paragraph 1 Radioactive Mineral Mining Article 50The Mining Business Area (Wilayah Usaha Pertambangan /WUP) for radioactive mineralsshall be stipulated by the Government and its exploitation shall be executed inaccordance with the provisions of laws and legislations. Paragraph 2 29
  • Metal Mineral Mining Article 51The Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) for metalmineral shall be granted to a business entity, cooperative, and individual through abid. Article 52(1) The holder of Exploration Mining Business Permit (IUP Eksplorasi) for metal mineral shall be granted a Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) with minimum size of 5,000 (five thousand hectares) and a maximum of 100,000 (one hundred thousand) hectares.(2) On an area where a Exploration Mining Business Permit (IUP Eksplorasi) for metal mineral has been granted, a Mining Business Permit (Izin Usaha Pertambangan/IUP) may be given to another party to exploit another mineral which discovery is separate.(3) The grant of Mining Business Permit (Izin Usaha Pertambangan/IUP) as referred to in clause (2) shall be made after considering opinions from the first holder of a Mining Business Permit (Izin Usaha Pertambangan/IUP). Article 53The holder of Production Operation Mining Business Permit (IUP Operasi Produksi/IUPOP) for metal mineral shall be granted a Mining Business Permit Area (WilayahIzin Usaha Pertambangan /WIUP) for a maximum size of 25,000 (twenty-five thousand)hectares. Paragraph 3 Non Metal Mineral Mining 30
  • Article 54The Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) for nonmetal mineral shall be granted to a business entity, cooperative, and individualthrough a proposal for an area to the grantor of permit as referred to in Article 37. Article 55(1) The holder of Exploration Mining Business Permit (IUP Eksplorasi) for non metal mineral shall be granted a Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) with minimum size of 500 (five hundred hectares) and a maximum of 25,000 (twenty-five thousand) hectares.(2) On an area where a Exploration Mining Business Permit (IUP Eksplorasi) for non metal minerals has been granted, a Mining Business Permit (Izin Usaha Pertambangan/IUP) may be given to another party to exploit another mineral which discovery is separate.(3) The grant of Mining Business Permit (Izin Usaha Pertambangan/IUP) as referred to in clause (2) shall be made after considering opinions from the first holder of a Mining Business Permit (Izin Usaha Pertambangan/IUP). Article 56The holder of Production Operation Mining Business Permit (IUP Operasi Produksi/IUPOP) of non metal mineral shall be granted a Mining Business Permit Area (WilayahIzin Usaha Pertambangan /WIUP) for a maximum size of 5,000 (five thousand) hectares. Paragraph 4 Rock Mining Article 57 31
  • The Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) for rockshall be granted to a business entity, cooperative, and individual through a proposalfor an area to the grantor of permit as referred to in Article 37. Article 58(1) The holder of Exploration Mining Business Permit (IUP Eksplorasi) for rock shall be granted a Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) with minimum size of 5 (five hectares) and a maximum of 5,000 (five thousand) hectares.(2) On an area where a Exploration Mining Business Permit (IUP Eksplorasi) for rock has been granted, a Mining Business Permit (Izin Usaha Pertambangan/IUP) may be given to another party to exploit another mineral which discovery is separate.(3) The grant of Mining Business Permit (Izin Usaha Pertambangan/IUP) as referred to in clause (2) shall be made after considering opinions from the first holder of a Mining Business Permit (Izin Usaha Pertambangan/IUP). Article 59The holder of Production Operation Mining Business Permit (IUP Operasi Produksi/IUPOP) for rock shall be granted a Mining Business Permit Area (Wilayah Izin UsahaPertambangan /WIUP) for a maximum size of 1,000 (one thousand) hectares. Section Five Coal Mining Article 60The Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) for coalshall be granted to a business entity, cooperative, and individual through a bid. 32
  • Article 61(1) The holder of Exploration Mining Business Permit (IUP Eksplorasi) for coal shall be granted a Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) with minimum size of 5,000 (five thousand hectares) and a maximum of 50,000 (fifty thousand) hectares.(2) On an area where a Exploration Mining Business Permit (IUP Eksplorasi) for coal has been granted, a Mining Business Permit (Izin Usaha Pertambangan/IUP) may be given to another party to exploit the mineral which discovery is separate.(3) The grant of Mining Business Permit (Izin Usaha Pertambangan/IUP) as referred to in clause (2) shall be made after considering opinions from the first holder of a Mining Business Permit (Izin Usaha Pertambangan/IUP). Article 62The holder of Production Operation Mining Business Permit (IUP Operasi Produksi/IUPOP) for coal shall be granted a Mining Business Permit Area (Wilayah Izin UsahaPertambangan /WIUP) for a maximum size of 15,000 (fifteen thousand) hectares. Article 63Further provisions concerning procedure to obtain the Mining Business Permit Area(Wilayah Izin Usaha Pertambangan /WIUP) as referred to in Article 51, Article 54, Article57, and Article 60 shall be regulated under a government regulation. CHAPTER VIII REQUIREMENTS FOR MINING BUSINESS PERMIT Article 64The government and the local government, in accordance with their authority shallannounce the plan of the mining business activities in the Mining Business Permit Area 33
  • (Wilayah Izin Usaha Pertambangan /WIUP) as referred to in Article 16 and grant theExploration Mining Business Permit (IUP Eksplorasi) and Production Operation MiningBusiness Permit (IUP Operasi Produksi /IUPOP) as referred to in Article 36 to the publicopenly. Article 65(1) The business entity, cooperative, and individual, as referred to in Article 51, Article 54, Article 57, and Article 60 mining a mining business shall be obliged to meet administrative, technical, environment, and financial requirements.(2) Further terms pertaining to the administrative, technical, environment, and financial requirements as referred to in clause (1) shall be regulated under a government regulation. CHAPTER IX PEOPLES MINING PERMIT Article 66The peoples mining activity as referred to in Article 20 shall be categorized as follows:a. metal mineral mining;b. non metal mineral mining;c. rock mining; and /ord. coal mining. Article 67(1) The bupati (regent) /mayor grants the Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR) in particular for the local people, be them individuals or community group and /or cooperative. 34
  • (2) The bupati (regent) /mayor may delegate the authority of execution of grant of Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR)as referred to in clause (1) to the chief of subdistrict (camat) pursuant to the provisions of laws and legislations.(3) To obtain the Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR) as referred to in clause (1), the applicant shall submit a proposal to the bupati (regent) /mayor. Article 68(1) The size of area for 1 (one) Peoples Mining Business Permit (Izin PertambanganRakyat/IPR) which may be granted to: a. an individual is a maximum of 1 (one) hectare; b. a community group is a maximum of 5 (five) hectares; and /or c. a cooperative is a maximum of 10 (one) hectare;(2) The Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR) shall be given for a maximum period of 5 (five) years which may be extended. Article 69The holder of a Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR) shallbe entitled to:a. get an assistance and supervision in work safety and health, the environment mining engineering, and management from the government and /or regional government; andb. receive capital aid in accordance with the provisions of laws and legislations. Article 70The holder of a Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR) shall: 35
  • a. execute mining activities no later than 3 (three) months after the Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR) is issued;b. comply with the provisions of laws and legislations in work safety and health in mining, environment management, and meet applicable standards;c. manage the environment with the local government;d. pay a fixed fee and exploration fee; ande. submit a report of execution of peoples mining business activities regularly to the grantor of the Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR). Article 71(1) As addition to matters as referred to in Article 70, the holder of a Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR) in running the activities of peoples mining as referred to in Article 66 shall comply with mining technical requirements.(2) Further provisions concerning mining technical requirements as referred to in clause (1) shall be regulated under a government regulation. Article 72Further provisions concerning procedure of grant of a Peoples Mining Business Permit(Izin Pertambangan Rakyat/IPR) shall be regulated under a kabupaten(regency)/municipality local regulation. Article 73(1) The government of the kabupaten (regency)/municipality runs assistance in exploitation, mining technology, and investment and marketing in the context of improving the capability of the peoples mining business.(2) The government of the kabupaten (regency)/municipality shall be responsible for technical safeguarding on peoples mining business covering: 36
  • a. work safety and health; b. management of the environment; c. post mining.(3) To execute technical safeguarding as referred to in clause (2), the government of the kabupaten (regency)/municipality shall appoint a mine inspector functional officer in accordance with the provisions of laws and legislations.(4) The government of the kabupaten (regency)/municipality shall take a record of production of all peoples mining business activities in its region and shall report thereof regularly to the Minister and respective governor. CHAPTER X SPECIAL MINING BUSINESS PERMIT (IZIN USAHA PERTAMBANGAN KHUSUS /IUPK) Article 74(1) A Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall be granted by the Minister by considering regional interest.(2) The Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) as referred to in clause (1) shall be granted for 1 (one) type of mineral or coal in 1 (one) Special Mining Business Permit Area (Wilayah Izin Usaha Pertambangan Khusus/WIUPK).(3) The holder of a Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) as referred to in clause (1) who discovers other minerals in the managed Special Mining Business Permit Area (Wilayah Izin Usaha Pertambangan Khusus/WIUPK) shall be given priority for exploitation thereof. 37
  • (4) The holder of the Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) who intends to exploit other minerals as referred to in clause (2) shall submit a new Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) proposal to the Minister.(5) The holder of a Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) as referred to in clause (2) may state his /her unwillingness to exploit the other minerals discovered.(6) The holder of the Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) who is not willing to exploit the other minerals discovered as referred to in clause (4), shall safeguard the other mineral to prevent utilization by other party.(7) The Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) for the other mineral as referred to in clause (4) and (5) may be granted to another party by the Minister. Article 75(1) The grant of Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) as referred to in Article 74 clause (1) shall be made based on considerations as referred to in Article 28.(2) The Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) as referred to in clause (1) may be granted to a business entity which has Indonesian legal entity, be it in form of a state owned legal entity, a regional owned legal entity, or a private business entity. 38
  • (3) The state owned business entity and regional owned business entity as referred to in paragraph (2) shall be given priority in obtaining the Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK).(4) For the private business entity as referred to in clause (2), obtaining a Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall be conducted through bid of a Special Mining Business Permit Area (Wilayah Izin Usaha Pertambangan Khusus/WIUPK). Article 76(1) The Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK)comprises of two phases: a. Exploration Special Mining Business Permit (IUPK Eksplorasi)covering the activity of general survey, exploration, and feasibility study; b. Production Operation Special Mining Business Permit (IUPK Operasi Produksi) covering the activities of construction, mining, processing, and refining, and transportation and sales.(2) The holder of the Exploration Special Mining Business Permit (IUPK Eksplorasi) and Production Operation Special Mining Business Permit (IUPK Operasi Produksi) may run some of or all activities as referred to in clause (1).(3) Further provisions concerning procedure to obtain a Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) as referred to in clause (1) shall be regulated under a government regulation. Article 77 39
  • (1) Every holder of a Exploration Special Mining Business Permit (IUPK Eksplorasi) is guaranteed to obtain a Production Operation Special Mining Business Permit (IUPK Operasi Produksi) as a continuance of his /her mining business activity.(2) The Production Operation Special Mining Business Permit (IUPK Operasi Produksi) may be granted to a business entity which is an Indonesian legal entity as referred to in Article 75 clause (3) and clause (4) which has obtained the data of result of feasibility study. Article 78The Exploration Special Mining Business Permit (IUPK Eksplorasi) as referred to inArticle 76 clause (1) item a shall include at least:a. name of the company;b. size and location of area;c. general spatial planning;d. surety bond;e. investment capital;f. time extension of an activity phase;g. rights and obligations of the holder of the Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK);h. duration of activity phase;j. type of business awarded;j. plan for development and empowerment of the community in the vicinity of the mining area;k. taxation;l. settlement of dispute and land issues; 40
  • m. fixed fee and exploration fee; andn. AMDAL (Environment Impact Statement). Article 79The Production Operation Special Mining Business Permit (IUPK Operasi Produksi) asreferred to in Article 76 clause (1) item b shall include at least:a. name of the company;b. size of area;c. location of mining;d. location of processing and refining;e. transportation and sales;f. investment capital;g. duration of activity phase;h. settlement of land issues;i. the environment including post mining reclamation;j. reclamation and post mining bond fund;k. duration of validity of the Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK);l. extension of the Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK);m. rights and obligations;n. development and empowerment of the community in the vicinity of the mining area;o. taxation; 41
  • p. fixed fee and production fee and state /regional income portion, comprises of profit sharing of net profit since production;q. settlement of dispute;r. work safety and health;s. conservation of mineral or coal;f. utilization of domestic goods, services, technology, engineering and construction capability;u. application of good economy and mining engineering rules;v. improvement of Indonesian workers;w. management of mineral or coal data;x. mastery, development, and implementation of mineral or coal mining technology; andy. divestment of shares Article 80The Mining Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK)shall not be used for purpose other than intended in the grant of the Special MiningBusiness Permit (Izin Usaha Pertambangan Khusus/IUPK). Article 81(1) In case of the activity of exploration and the activity of feasibility study, the holder of the Exploration Special Mining Business Permit (IUPK Eksplorasi) who obtains excavated mineral or coal shall submit a report to the Minister.(2) The holder of the Exploration Special Mining Business Permit (IUPK Eksplorasi) intending to sell the metal mineral or coal as referred to in paragraph (1) shall propose for a temporary permit to conduct transportation and sales. 42
  • (3) The temporary permit as referred to in clause (2) shall be granted by the Minister. Article 82To the excavated mineral or coal as referred to in Article 81, a production fee may beimposed.The requirement for size of are and time limit conforming to mining business categoryapplicable for a holder of Special Mining Business Permit (Izin Usaha PertambanganKhusus/IUPK) covers:a. the size of 1 (one) Special Mining Business Permit Area (Wilayah Izin Usaha Pertambangan Khusus/WIUPK) for the phase of activity ofmetal mineral mining exploration shall be given at a maximum size of 100,000 (one hundred thousand) hectares.b. the size of 1 (one) Special Mining Business Permit Area (Wilayah Izin Usaha Pertambangan Khusus/WIUPK) for the phase of production operation of metal mineral mining shall be given at a maximum size of 25,000 (twenty-five thousand) hectares.c. the size of 1 (one) Special Mining Business Permit Area (Wilayah Izin Usaha Pertambangan Khusus/WIUPK) for the phase of exploration activity shall be given at a maximum size of 50,000 (fifty thousand) hectares.d. the size of 1 (one) Special Mining Business Permit Area (Wilayah Izin Usaha Pertambangan Khusus/WIUPK) for the phase of production operation activity shall be given at a maximum size of 15,000 (fifteen thousand) hectares.e. The Exploration Special Mining Business Permit (IUPK Eksplorasi) for metal mineral mining may be granted for a period of a maximum of 8 (eight) years. 43
  • f. The Exploration Special Mining Business Permit (IUPK Eksplorasi) for coal mining may be granted for a period of a maximum of 7 (seven) years.g. The Production Operation Special Mining Business Permit (IUPK Operasi Produksi) for metal mineral or coal mining may be granted for a maximum period of 20 (twenty) years and may be extended twice, respectively for 10 (ten) years. Article 84Further provisions concerning procedure to obtain the Special Mining Business PermitArea (Wilayah Izin Usaha Pertambangan Khusus/WIUPK) as referred to in Article 74clause (2) and clause (3), and Article 75 clause (3) shall be regulated under agovernment regulation. CHAPTER XI REQUIREMENTS FOR SPECIAL MINING BUSINESS PERMIT Article 85The government shall announce the plan of the mining business activities in the SpecialMining Business Permit Area (Wilayah Izin Usaha Pertambangan Khusus/WIUPK) asreferred to in Article 30 and grant the Exploration Special Mining Business Permit(IUPK Eksplorasi) and Production Operation Special Mining Business Permit (IUPKOperasi Produksi) as referred to in Article 76 to the public openly.(1) The business entity as referred to in Article 75 clause (2) which running the activity in the Special Mining Business Permit Area (Wilayah Izin Usaha Pertambangan Khusus/WIUPK) shall satisfy administrative, technical, environment, and financial requirements. 44
  • (2) Further terms pertaining to the administrative, technical, environment, and financial requirements as referred to in paragraph (1) shall be regulated under a government regulation. CHAPTER XII MINING DATA Article 87To support preparation of the Mining Area (Wilayah Pertambangan /WP) anddevelopment of mining knowledge and technology, the Minister or the governor,conforming to their authority may assign a state and /or regional research institutionto conduct survey and research in mining. Article 88(1) The data acquired from the mining business activity shall be the data owned by the Government and /or regional government conforming to their authority.(2) The data of mining business owned by the regional government shall be delivered to the Government for national level mining data processing.(3) The data processing as referred to in clause (1) shall be administered by the Government and /or regional government conforming to their authority. Article 89Further provisions concerning procedure of assigning survey and research as referredto in Article 87 and data processing as referred to in Article 88 shall be regulated undera government regulation. CHAPTER XIII RIGHTS AND OBLIGATIONS Section One Rights Article 90 45
  • The holder of a Mining Business Permit (Izin Usaha Pertambangan/IUP) and SpecialMining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) may conduct some ofor all phases of mining business for both exploration and production operationactivities. Article 91The holder of a Mining Business Permit (Izin Usaha Pertambangan/IUP) or SpecialMining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) may utilize publicfacilities for mining purpose after satisfying the provisios of laws and legislations. Article 92The holder of a Mining Business Permit (Izin Usaha Pertambangan/IUP) or SpecialMining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) has the right to ownmineral, including its trace minerals or coal already produced after the exploration orproduction fee is paid, except for radioactive trace mineral. Article 93(1) The holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall not transfer his /her Mining Business Permit (Izin Usaha Pertambangan/IUP) and Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) to another party.(2) Transfer of ownership and /or share at the Indonesian Stock Exchange may only be conducted after running a specific phase of exploration activity.(3) The transfer of ownership and /or share as referred to in clause (2) may only be conducted under the following conditions: a. must deliver a notification to the Minister, governor, or bupati (regent) /mayor conforming to their authority; and 46
  • b. provided that it is not contradictive to the provisions of laws and legislations. Article 94The right of the holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) orSpecial Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall beguaranteed foro running mining business in accordance with the provisions of lawsand legislations. Section Two Obligations Article 95The holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) and SpecialMining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall:a. implement good mining engineering rules;b. manage finance conforming to Indonesian accounting system;c. create an added value of mineral and /or coal resource;d. conduct development and empowerment of the local community; ande. comply with the tolerance limit of environment bearing capacity. Article 96In the implementation of good mining engineering rules, the holder of the MiningBusiness Permit (Izin Usaha Pertambangan/IUP) and the Special Mining Business Permit(Izin Usaha Pertambangan Khusus/IUPK) shall execute:a. the provisions concerning mining work safety and health;b. mining operation safety;c. management and supervision of mining environment, including reclamation and post mining activities; 47
  • d. the effort of conservation of mineral and coal resources;e. management of mining tailing of a mining business activity in solid, liquid, or gas form until it meets the environment quality standard before release to the environment. Article 97The holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) and SpecialMining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall guarantee theapplication of environment quality standard in accordance with characteristics of aregion. Article 98The holder of a Mining Business Permit (Izin Usaha Pertambangan/IUP) or SpecialMining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall maintain thepreservation of function and support capability of the respective water resource inaccordance with the provisions of laws and legislations. Article 99(1) Every holder of a Mining Business Permit (Izin Usaha Pertambangan/IUP) and Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall seliver a reclamation and post mining plan when proposing for a Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) or Production Operation Special Mining Business Permit (IUPK Operasi Produksi).(2) Execution of the reclamation and post mining activity shall be made conforming to post mining land purpose.(3) The post mining land purpose as referred to in clause (2) shall be written in a land use agreement between the holder of Mining Business Permit (Izin Usaha 48
  • Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) and holder of right over the land. Article 100(1) The holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall provide a guarantee fund for reclamation and post mining guarantee fund.(2) The Minister, governor, or bupati (regent) /mayor, conforming to their authority may assign a third party to conduct reclamation and post mining activities utilizing the guarantee fund as referred to in clause (1).(3) The provisions as referred to in clause (2) shall apply if the holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) fail to execute the reclamation and post mining activities conforming to approved plan. Article 101Further terms concerning reclamation and post mining as referred to in Article 99 andreclamation guarantee fund and post mining guarantee fund as referred to in Article100 shall be regulated under a government regulation. Article 102The holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) or SpecialMining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall increase theadded value of the mineral and /or coal in execution of the mining, processing, andrefining, and utilization of mineral and coal. Article 103 49
  • (1) The holder of Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) and Production Operation Special Mining Business Permit (IUPK Operasi Produksi) shall execute processing and refining of mining result in Indonesia.(2) The holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) and Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) as referred to in clause (1) may process and refine the mining result from another holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) and Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK).(3) Further provisions concerning improvement of added value as referred to in Article 102 and processing and refining as referred to in clause (2) shall be regulated under a government regulation. Article 104(1) For processing and refining, the holder of the Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) and Production Operation Special Mining Business Permit (IUPK Operasi Produksi) as referred to in Article 103 may arrange a collaboration with a business entity, cooperative, or individual who has obtained a Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK).(2) The Mining Business Permit (Izin Usaha Pertambangan/IUP) obtained by a business entity as referred to in clause (1) shall be a Specific Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) issued by the Minister, the governor, and the bupati (regent) /mayor in accordance with their authority.(3) The holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) and Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) as referred to in 50
  • clause (1) is prohibited from conducting processing and refining of mining result from anyone who is not a holder of Mining Business Permit (Izin Usaha Pertambangan/IUP), Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR), or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK). Article 105(1) A business entity which business activity is not in the mining business intending to sell excavated mineral and /or coal shall first obtain a Production Operation Mining Business Permit (IUP Operasi Produksi /IUPOP) for sales.(2) The Mining Business Permit (Izin Usaha Pertambangan/IUP) as referred to in Article 1 paragraph (1) may only be granted once by the by the Minister, the governor, and the bupati (regent) /mayor in accordance with their authority.(3) On the excavated mineral or coal to sell as referred to in clause (1), a production fee may be imposed.(4) The Business Entity as referred to in clause (1) and clause (2) shall submit a report of sales of excavated mineral and /or coal to the by the Minister, the governor, and the bupati (regent) /mayor in accordance with their authority. Article 106The holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) and SpecialMining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) must give priority toemployment of local worker, domestik goods and services in accordance with theprovisions of laws and legislations. Article 107In running the production operation activity, the business holder holding a MiningBusiness Permit (Izin Usaha Pertambangan/IUP) and Special Mining Business Permit 51
  • (Izin Usaha Pertambangan Khusus/IUPK) shall involve local entrepreneurs in the regionin accordance with the provisions of laws and legislations.(1) The holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) an Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall devise a community development and empowerment program.(2) The devise of program and plan as referred to in clause (1) shall be with consult with the Government, the regional government, and the people. Article 109Further provisions concerning procedure of execution of community development andempowerment as referred to in Article 108 shall be regulated under a governmentregulation. Article 110The holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) and SpecialMining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall surrender all dataacquired from exploration and production exploitation result to the Minister, thegovernor, and the bupati (regent) /mayor in accordance with their authority. Article 111(1) The holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) and Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall submit a written report regularly concerning the work plan and excution of mineral and coal mining business activities to the Minister, the governor, and the bupati (regent) /mayor in accordance with their authority.(2) Further provisions concerning format, type, time, and procedure of submission of report as referred to in clause (1) shall be regulated under a government regulation. 52
  • Article 112(1) After 5 (five) years of production, a business entity holding a Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) which shares are owned by foreigners shall conduct a divestment of shares on the Government, regional government, state owned company, regional owned company, or national private business entity.(2) Further terms concerning divestment of shares as referred to in paragraph (1) shall be regulated by a government regulation. CHAPTER XIVTEMPORARY SUSPENSION OF MINING BUSINESS PERMIT ACTIVITIES AND SPECIAL MINING BUSINESS PERMIT Article 113(1) Temporary suspension of a mining business activity may be granted to the holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) and Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) in the event of: a. force majeure b. obstructive condition which causes halt of part of or all of mining business activities; c. when all bearing capacities of the environment of the area cannot support the load of production operation activity of mineral and /or coal resource conducted in its area.(2) The temporary suspension of mining business activity as referred to in clause (1) shall not reduce the validity period of the Mining Business Permit (Izin Usaha 53
  • Pertambangan/IUP) and Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK).(3) The request for temporary suspension of mining business activity as referred to in clause (1) item a and item b shall be delivered to the Minister, the governor, and the bupati (regent) /mayor in accordance with their authority.(4) The temporary suspension as referred to in clause (1) item c may be exercised by the mine inspector or exercised based on the peoples request to the Minister, the governor, and the bupati (regent) /mayor in accordance with their authority.(5) The Minister, the governor, and the bupati (regent) /mayor in accordance with their authority shall issue a written decree on grant or rejection along the reason thereof upon the request as referred to in clause (3) no later than 30 (thirty) days from the receipt of the request. Article 114(1) The duration of temporary suspension due to force majeure and /or obstructive condition as referred to in Article 113 clause (1) shall be granted for a maximum of 1 (one) year which may be extended at a maximum once for 1 (one) year.(2) If within the time before the temporary suspension period expires, the holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) and Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) is ready to execute his /her operation activities, the activities shall be reported to the Minister, the governor, and the bupati (regent) /mayor in accordance with their authority.(3) The Minister, the governor, and the bupati (regent) /mayor in accordance with their authority shall revoke the decree of temporary suspension after receiving the report as referred to in clause (2). 54
  • Article 115(1) If temporary suspension of the mining business activity is granted due to force majeure as referred to in Article 113 clause (1) item a, the obligations of the Mining Business Permit (Izin Usaha Pertambangan/IUP) and Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) to the Government and the local government cease to apply.(2) If temporary suspension of the mining business activity is granted due to conditions obstructive to mining business activities as referred to in Article 113 clause (1) item b, the obligations of the Mining Business Permit (Izin Usaha Pertambangan/IUP) and Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) to the Government and the local government continue to apply.(3) If temporary suspension of the mining business activity is granted due to condition of environment bearing capacity of the area as referred to in Article 113 clause (1) item c, the obligations of the Mining Business Permit (Izin Usaha Pertambangan/IUP) and Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) to the Government and the local government continue to apply. Article 116Further provisions concerning temporary suspension of mining business activity asreferred to in Article 113, Article 114, and Article 115 shall be regulated under agovernment regulation. CHAPTER XV EXPIRY OF MINING BUSINESS PERMIT AND SPECIAL MINING BUSINESS PERMIT Article 117 55
  • The Mining Business Permit (Izin Usaha Pertambangan/IUP) and Special MiningBusiness Permit (Izin Usaha Pertambangan Khusus/IUPK) shall expire due to:a. returned;b. revoked; orc. expiry of its validity period. Article 118(1) The holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) may return his /her Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) by written statement to the Minister, the governor, and the bupati (regent) /mayor in accordance with their authority along a clear reason thereof.(2) The returning of the Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) as referred to in clause (1) shall be stated valid after approval by the Minister, the governor, and the bupati (regent) /mayor in accordance with their authority and after the obligations of the holder are complied with. Article 119The Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining BusinessPermit (Izin Usaha Pertambangan Khusus/IUPK) can be revoked by the Minister, thegovernor, and the bupati (regent) /mayor in accordance with their authority, in theevent that:a. the holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) fails to comply with 56
  • the obligations stipulated in the Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) and the provisions of laws and legislations.b. the holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) conducts a criminal act as referred to in this Law; orc. the holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) or SpecialMining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) is stated to bebankrupt. Article 120In the event the period defined in the Mining Business Permit (Izin UsahaPertambangan/IUP) and Special Mining Business Permit (Izin Usaha PertambanganKhusus/IUPK) has expired and an advancement or extension request is not submittedfor the activity or a request is submitted but fails to meet requirements, thet MiningBusiness Permit (Izin Usaha Pertambangan/IUP) and Special Mining Business Permit(Izin Usaha Pertambangan Khusus/IUPK) shall cease to be valid. Article 121(1) The holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) which Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) expires due to the reason as referred to in Article 117, Article 118, Article 119, and Article 129 shall fulfill and settle obligations in accordance with the provisions of laws and legislations. 57
  • (2) The obligations of the holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) as referred to in clause (1) shall be considered to have been complied with and approved by the Minister, the governor, and the bupati (regent) /mayor in accordance with their authority. Article 122(1) The Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) which has been returned, revoked, or validity period expires as referred to in Article 121, shall be returned to the Minister, the governor, and the bupati (regent) /mayor in accordance with their authority.(2) The Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP) or Special Mining Business Permit Area (Wilayah Izin Usaha Pertambangan Khusus/WIUPK) which Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) has expired as referred to in clause (1) shall be offered to a business entity, cooperative, or individual through a mechanism in accordance with the provisions of this Law. Article 123In the event the Mining Business Permit (Izin Usaha Pertambangan/IUP) or SpecialMining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) expires, the holder ofthe Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining BusinessPermit (Izin Usaha Pertambangan Khusus/IUPK) shall surrender all data acquired fromexploration and production operation result to the Minister, the governor, and thebupati (regent) /mayor in accordance with their authority. 58
  • CHAPTER XVI MINING SERVICE BUSINESS Article 124(1) The holder of a Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall use local and /or national mining service companies.(2) In case the mining service companies as referred to in clause (1) is not available, the holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) may use other mining service companies which establishment are as Indonesian legal entity.(3) The type of mining service business covers: a. consulting, planning, execution, and testing of equipment in: 1) general survey; 2) exploration; 3) feasibility study; 4) mining construction; 5) transportation; 6) mining environment; 7) post mining and reclamation; and /or 8) work safety and health; b. consulting, planning, and testing of equipment in: 1) mining; or 2) processing and refining. Article 125 59
  • (1) In the event the holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) uses mining service, the responsibility of mining business activity shall remain on the holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK).(2) The executive of mining service business can be in form of a business entity, cooperative, or individual conforming to classification and qualification set forth by the Minister.(3) The actor of mining service company shall give priority to local contractors and workers.(4) The holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) is prohibited from involving affiliates in the mining service business sector in the mining business area it operates, except under consent of the Minister.(5) The grant of consent of the Minister as referred to in paragraph (1) shall be made in the event: a. there isnt any similar mining service companywithin the area; or b. there isnt any mining service company which is willing /capable. Article 127Further provisions concerning administering of mining business service as referred toin Article 124, Article 125, and Article 126 shall be regulated under a regulation of aminister. CHAPTER XVII 60
  • STATE AND REGIONAL INCOME Article 128(1) The holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall make payment for state income and regional income.(2) The state income as referred to in clause (1) comprises of tax income and non-tax state income.(3) The tax income as referred to in clause (2) comprises of: a. taxes which fall in the authority of the Government pursuant to the provisions of legislations in taxation; and b. import duty and excise.(4) The non tax state income as referred to in clause (2) comprises of: a. fixed fee; b. exploration fee; c. production fee; and d. compensation for information data.(5) The regional income as referred to in clause (1) comprises of: a. regional tax; b. regional fee; and c. other legal income pursuant the provisions of laws and legislations. Article 129(1) The holder of Production Operation Special Mining Business Permit (IUPK Operasi Produksi) for metal and coal mineral mining shall pay an amount of 4% (four percent to the Government and 6% (six percent) to the regional government out of net profit since production. 61
  • (2) The portion of the regional government as referred to in clause (1) shall be regulated as follows: a. the provincial government gets a portion of 1% (one percent); b. the kabupaten (regency)/municipality government where production takes place gets a portion of 2.5% (two point five percent); c. the other kabupaten (regency)/municipality government in the same province gets a portion of 2.5% (two point five percent); Article 130(1) To the holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK), production fee is not imposed as referred to in Article 128 clause (4) item c and regional tax and fee as referred to in Article 128 clause (5) on soil/rock also excavated during mining.(2) To the holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) or the Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) production fee is imposed as referred to in Article 128 clause (4) item c on utilization of soil/rock also excavated during mining. Article 131The amount of tax and non tax state income collected from the holders of MiningBusiness Permit (Izin Usaha Pertambangan/IUP) , Peoples Mining Business Permit (IzinPertambangan Rakyat/IPR), or Special Mining Business Permit (Izin Usaha PertambanganKhusus/IUPK) shall be stipulated in accordance with the provisions of laws andlegislations Article 132 62
  • (1) The amount of production fee tariff shall be stipulated based on exploitation level, production, and mine commodity prices.(2) The amount of production fee tariff as referred to in clause (1) shall be stipulated in accordance with the provisions of laws and legislations. Article 133(1) The non tax state income as referred to in Article 128 clause (4) constitutes state and regional income which distribution shall be stipulated in accordance with the provisions of laws and legislations.(2) The non tax state income which constitutes regional portion shall be paid directly to the regional treasury once in 3 (three) months after payment to the state treasury. CHAPTER XVIII LAND USE FOR MINING BUSINESS ACTIVITIES Article 134(1) The rights on Mining Business Permit Area (Wilayah Izin Usaha Pertambangan /WIUP), Peoples Mining Area (Wilayah Pertambangan Rakyat /WPR), and Special Mining Business Permit Area (Wilayah Izin Usaha Pertambangan Khusus/WIUPK) do not cover the right over land on the earth surface.(2) A mining business activity may not be conducted on places where it is prohibited to conduct mining business activity in accordance with the provisions of laws and legislations.(3) The mining business activity as referred to in clause (2) may be conducted after obtaining an approval from the Government institutions in accordance with the provisions of laws and legislations. Article 135 63
  • The holder of Exploration Mining Business Permit (IUP Eksplorasi) and ExplorationSpecial Mining Business Permit (IUPK Eksplorasi) may only conduct his /her activitiesafter obtaining an approval from the holder of right over land. Article 136(1) The holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) before execution of production operation, shall settle the right over land with the holder of right in accordance with the provisions of laws and legislations.(2) The settlement of right over land as referred to in clause (1) may be made in phases conforming to the needs of land by the holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK). Article 137To the holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) or SpecialMining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) as referred to in Article135 and Article 136 who has conducted settlement on plos of land may be given rightover land in accordance with the provisions of laws and legislations. Article 138The right on Mining Business Permit (Izin Usaha Pertambangan/IUP) , Peoples MiningBusiness Permit (Izin Pertambangan Rakyat/IPR), or Special Mining Business Permit (IzinUsaha Pertambangan Khusus/IUPK) does not constitute the right over land. CHAPTER XIXASSISTANCE, SUPERVISION, AND , PROTECTION OF THE PEOPLE Section One 64
  • Assistance and Supervision Article 139(1) The Minister conducts assistance on administering of mining business administering run by the provincial government and the government of kabupaten (regency)/municipality conforming to their authority.(2) The assistance as referred to in clause (1) includes: a. grant of directive and standard of execution of mining business management; b. grant of guidance, supervision, and consult; c. education and training; and d. planning, research, development, monitoring, and evaluation of execution of administering of mining business in mineral and coal sector.(3) The minister may delegate to the governor to conduct assistance on administering of authority in management in the mining business sector as referred to in clause (1) conducted by the government of the kabupaten (regency)/municipality.(4) The Minister, the governor, and the bupati (regent) /mayor in accordance with their authority shall be responsible for assistance on execution of mining business activities run by the holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) , Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR), or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK). Article 140(1) The Minister conducts supervision on administering of mining business administering run by the provincial government and the government of kabupaten (regency)/municipality conforming to their authority. 65
  • (2) The minister may delegate to the governor to conduct supervision on administering of authority in management in the mining business sector as referred to in clause (1) conducted by the government of the kabupaten (regency)/municipality.(3) The Minister, the governor, or the bupati (regent) /mayor in accordance with their authority shall conduct assistance on execution of mining business activities run by the holder of Mining Business Permit (Izin Usaha Pertambangan/IUP) , Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR), or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK). Article 141(1) The supervision as referred to in Article 140 among else is in form of: a. mining engineering; b. marketing; c. finance; d. processing of mineral and coal data; e. conservation of mineral and coal resources; f. mining work safety and health; g. mining operation safety; h. management of the environment, reclamation, and post mining; i. utilization of domestic goods, service, technology, engineering and construction capabilities; j. development of mining engineering workers; k. development and empowerment of the local community; l.. mastery, development, and application of mining technology; m. other activities in mining business activities related to public interest; 66
  • n. management of the Mining Business Permit (Izin Usaha Pertambangan/IUP) and Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK); and o. amount, type, and quality of the mining business result.(2) The supervision as referred to in clause (1) item a, item e, item f, item g, item h, and item l shall be made by the mine inspector in accordance with the provisions of laws and legislations.(3) In the event the provincial or government of the kabupaten (regency)/municipality has not had a mine inspector, the Minister shall assign an appointed mine inspector to execute assistance and supervision as referred to in clause (2). Article 142(1) The Governor and bupati (regent) /mayor shall report the execution of mining business in their respective are at least once in 6 (six) months to the Minister.(2) The Government may issue a warning to the regional government if in exercise of its authority; it fails to comply with the provisions of this Law or the provisions of other laws. Article 143(1) The bupati (regent)/mayor shall conduct assistance and supervision on thhe peoples mining business.(2) Further provisions concerning assistance and supervision of peoples mining shall be regulated under a kabupaten (regency)/municipality local regulation. Article 144 67
  • Further provisions the standard and procedure of assistance and supervision asreferred to in Article 139, Article 140, Article 141, Article 142, and Article 143 shall beregulated under a government regulation. Section Two Protection of the People Article 145(1) The people who are hit by direct negative impact of the mining business activity shall be entitled to: a. receive appropriate compensation due to a mistake in running mining activities in accordance with the provisions of laws and legislations. b. propose a claim to the court on loss incurred due to mining activity which violates a provision.(2) The provisions concerning protection for the people as referred to in clause (1) shall be stipulated in accordance with the provisions of laws and legislations. CHAPTER XX RESEARCH AND DEVELOPMENT AND EDUCATION AND TRAINING Section One Research and Development Article 146The Government and the regional government shall encourage, execute, and /orfacilitate the execution of research and development of mineral and coal. Section Two Education and Training Article 147 68
  • The Government and the regional government shall encourage, execute, and /orfacilitate the execution of education and training in mineral and coal exploitation. Article 148The administering of education and training may be made by the Government, thelocal government, private institutions, and the people. CHAPTER XXI INVESTIGATION Article 149(1) As addition to the police officers of the Republic of Indonesia, a civil servant officer which work and responsibility coverage in mining shall be given a special authority as an investigator in accordance with the provisions of laws and legislations.(2) The civil servant investigator as referred to in clause (1) shall have an authority to: a. conduct examination on the correctness of report or information pertaining to criminal act in the mining business activity; b. conduct examination on person or entity suspected to conduct criminal act in the mining business activity; c. summon and /or make a person appear in force to be heard and investigated as a witness or suspect in a criminal act of mining business activity; d. to search a place and /or facility suspected to be used for conducting a criminal act in the mining business activity; e. conduct examination of mining business activity facility and infrastructure and stop the use of equipment suspected to be used to conduct the crime; f. seal and /or confiscate the mining business activity equipment used to conduct the criminal act as an evidence; 69
  • g. to make appear of and /or request help from experts required in relation to the examination of criminal act case in the mining business activity; and /or h. terminate investigation of the case of criminal act in mining business activity. Article 150(1) The civil servant investigator as referred to in Article 149 may apprehend the actor of the criminal act in the mining business activity.(2) The civil servant investigator as referred to in clause (1) makes a report starting from investigation and delivers the result of investigation to the police officers of the Republic of Indonesia in accordance with the provisions of laws and legislations.(3) The civil servant investigator as referred to in clause (1) shall terminate his investigation in the event there is no sufficient evidence and /or the event does not constitute a criminal act.(4) Exercise of the authority as referred to in clause (2) and clause (3) shall be made in accordance with the provisions of laws and legislations. CHAPTER XXII ADMINISTRATIVE SANCTION Article 151(1) The Minister, the governor, and the bupati (regent) /mayor in accordance with their authority shall be entitled to impose administrative sanction to the holder of the Mining Business Permit (Izin Usaha Pertambangan/IUP) , Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR), or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) on violation of provisions as referred to in Article 30 clause (3), Article 40 clause (5), Article 41, Article 43, Article 70, Article 71 70
  • clause (1), Article 74 clause (4), Article 74 clause (6), Article 81 clause (1), Article 93 clause (3), Article 95, Article 96, Article 97, Article 98, Article 99, Article 100, Article 102, Article 103, Article 105 clause (3), Article 105 clause (4), Article 107, Article 108 clause (1), Article 110, Article 111 clause (1), Article 112 clause (1), Article 114 clause (2), Article 115 clause (2), Article 125 clause (3), Article 126 clause (1), Article 128 clause (1), Article 129 clause (1), or Article 130 clause (2).(2) The administrative sanction as referred to in clause (1) shall be in form of: a. a written warning; b. temporary suspension of part of or all parts of exploration or production operation activities; and /or c. revocation of Mining Business Permit (Izin Usaha Pertambangan/IUP), Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR), or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK). Article 152In the event the local government fails to execute the provisions as referred to in Article151 and the result of evaluation made by the Minister as referred to in Article 6 clause(1) item j, the Minister may temporarily suspend and /or revoke the Mining BusinessPermit (Izin Usaha Pertambangan/IUP) or Peoples Mining Business Permit (IzinPertambangan Rakyat/IPR) in accordance with the provisions of laws and legislations. Article 153In the event the regional government objects to the temporary suspension and /orrevocation of the Mining Business Permit (Izin Usaha Pertambangan/IUP) and PeoplesMining Business Permit (Izin Pertambangan Rakyat/IPR) by the Minister as referred to in 71
  • Article 152, the regional government may propose an objection in accordance with theprovisions of laws and legislations. Article 154Any dispute incurring in the exercise of the Mining Business Permit (Izin UsahaPertambangan/IUP) , Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR), orSpecial Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) shall be settledthrough the court and domestic arbitration in accordance with the provisions of lawsand legislations.All legal consequences incurring due to temporary suspension and /or revocation ofMining Business Permit (Izin Usaha Pertambangan/IUP) , Peoples Mining BusinessPermit (Izin Pertambangan Rakyat/IPR), or Special Mining Business Permit (Izin UsahaPertambangan Khusus/IUPK) as referred to in Article 151 clause (2) item b and item cshall be settled in accordance with the provisions of laws and legislations. Article 156Further provisions concerning procedure exercise of administrative sanction asreferred to in Article 151 and Article 152 shall be regulated under a governmentregulation. Article 157On the regional government which fails to meet the provisions as referred to in Articleclause (4), administrative sanction shall be imposed in form of temporary removal ofauthority on the right of management of mineral and coal mining business. CHAPTER XXIII CRIMINAL PROVISIONS Article 158 72
  • Every person who conducts a mining business without a Mining Business Permit (IzinUsaha Pertambangan/IUP) , Peoples Mining Business Permit (Izin PertambanganRakyat/IPR), or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK)as referred to in Article 37, Article 40 clause (3), Article 48, Article 67 clause (1), Article74 clause (1) or clause (5) shall be punished with a jail term for a maximum time of 10(ten) years and fine for a maximum amount of Rp 10.000.000.000,00 (ten billionrupiahs). Article 159The holder of a Mining Business Permit (Izin Usaha Pertambangan/IUP) , PeoplesMining Business Permit (Izin Pertambangan Rakyat/IPR), or Special Mining BusinessPermit (Izin Usaha Pertambangan Khusus/IUPK) who deliberately submits a report asreferred to in Article 43 clause (1), Article 70 item e, Article 81 clause (1), Article 105clause (4), Article 110, or Article 111 clause (1) incorrectly or gives false informationshall be punished with a jail term for a maximum time of 10 (ten) years and fine for amaximum amount of Rp. 10.000.000.000,00 (ten billion rupiahs). Article 160(1) Every person who conducts exploration without obtaining a Mining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) as referred to in Article 37 or Article 74 clause (1) shall be punished with a jail term for a maximum time of 1 (one) year or fine for a maximum amount of Rp. 200.000.000,00 (two hundred million rupiahs).(2) Every person who possesses a Exploration Mining Business Permit (IUP Eksplorasi) but runs production operation activity shall be punished with a jail term for a 73
  • maximum of 5 (five) year and fine for a maximum of Rp. 10.000.000.000,00 (ten billion rupiahs). Article 161Every person who holds a Production Operation Mining Business Permit (IUP OperasiProduksi /IUPOP) or Production Operation Special Mining Business Permit (IUPKOperasi Produksi) who collects, utilizes, and conducts processing and refining,transportation, sales of mineral and coal sourced not from a holder of a MiningBusiness Permit (Izin Usaha Pertambangan/IUP) , Special Mining Business Permit (IzinUsaha Pertambangan Khusus/IUPK) or permit as referred to in Article 37, Article 40clause (3), Article 43 clause (2), Article 48, Article 67 clause (1), Article 74 clause (1),Article 81 clause (2), Article 103 clause (2), Article 104 clause (3), atau Article 105 clause(1) shall be punished by a jail term for a maximum time of 10 (ten) years and fine for amaximum of Rp. 10.000.000.000,00 (ten billion rupiahs). Article 162Every person who obstructs or interrupts the mining business activity of a holder of aMining Business Permit (Izin Usaha Pertambangan/IUP) or Special Mining BusinessPermit (Izin Usaha Pertambangan Khusus/IUPK) who has met the requirements asreferred to in Article 136 clause (2) shall be punished by a jail term for a maximum of 1(one) year and fine for a maximum of Rp. 100.000.000,00 (one hundred millionrupiahs). Article 163(1) In the event the criminal act as referred to in this chapter is conducted by a legal entity, as addition to the jail term and fine on its management, a punishment can 74
  • also be imposed on the legal entity in form of fine punishment with aggravation plus 1/3 (one-third) of maximum fine punishment imposed.(2) As addition of fine punishment as referred to in clause (1), additional punishment can also be imposed on the legal entity in form of: a. revocation of business permit; and /or b. revocation of legal entity status. Article 164Other than the provisions as referred to in Article 158, Article 159, Article 160, Article161, and Article 162, on the actor of the criminal act, additional punishment may beimposed in form of:a. confiscation of goods used conducting the criminal act;b. confiscation of profit gained from the criminal act; and /orc. obligation to pay costs incurred due to the criminal act. Article 165Every person who issues the Mining Business Permit (Izin Usaha Pertambangan/IUP) ,Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR), or Special MiningBusiness Permit (Izin Usaha Pertambangan Khusus/IUPK) which contradicts this Lawand misuses his /her authority shall be punished with a jail term for a maximum of 2(two) years and fine for a maximum of Rp 200.000.000,00 (two hundred millionrupiahs). CHAPTER XXIV OTHER PROVISIONS Article 166 75
  • Every problem incurring on the exercise of Mining Business Permit (Izin UsahaPertambangan/IUP) , Peoples Mining Business Permit (Izin Pertambangan Rakyat/IPR), orSpecial Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) related toenvironment impact shall be settled in accordance with the provisions of laws andlegislations. Article 167The Mining Area (Wilayah Pertambangan /WP) shall be managed by the Minister in anationally integrated Mining Area (Wilayah Pertambangan /WP) information system toconduct homogenization of coordinate system and base map in issuance of MiningBusiness Area (Wilayah Usaha Pertambangan /WUP), Mining Business Permit Area(Wilayah Izin Usaha Pertambangan /WIUP), Peoples Mining Area (Wilayah PertambanganRakyat /WPR), State Reserve Area (Wilayah Pencadangan Negara /WPN), Special MiningBusiness Area (Wilayah Usaha Pertambangan Khusus /WUPK), and Special MiningBusiness Permit Area (Wilayah Izin Usaha Pertambangan Khusus/WIUPK). Article 168To increase investment in mining, the Government may provide facilities and taxationfacilities in accordance with the provisions of laws and legislations except statedotherwise in the Mining Business Permit (Izin Usaha Pertambangan/IUP) or SpecialMining Business Permit (Izin Usaha Pertambangan Khusus/IUPK). CHAPTER XXV TRANSITIONAL PROVISIONS Article 169At the time this Law comes into effect: 76
  • a. Contract of work and concession work agreement for coal mining which have existed before this Law comes into effect shall remain effective until expiry of the contract /agreement.b. The provisions in the articles in the contract of work and concession agreement for coal mining as referred to in clause a shall be adjusted no later than 1 (one) year since this Law is promulgated except for matters pertaining to state income.c. Exception to the state income as referred to in item b shall be the effort to increase state income. Article 170The holder of a contract of work as referred to in Article 169 who has startedproduction shall conduct refining as referred to in Article 103 clause (1) no later than 5(five) years since this Law is promulgated. Article 171(1) The holder of contract of work and concession work contract for coal mining as referred to in Article 169 who has conducted the activity phase of exploration, feasibility study, construction, or production operation no later than 1 (one) year since this Law comes into effect must submit an activity plan on all contract /agreement areas until the period of expiry of contract /termination to obtain government approval.(2) In the event the provision as referred to in clause (1) cannot be satisfied, the size of mining area already granted to the holder of the contract of work and work agreement of coal mining concession shall be adjusted to this Law. Article 172 77
  • The request for contract of work and work agreement on coal mining business alreadyproposed to the Minister at least 1 (one) year before this Law comes into effect and hasobtained a principle approval certificate or preliminary survey permit certificate shallkeep being respected and its permit can be processed without going through a bid inaccordance with the provisions of this Law. CHAPTER XXVI CLOSING PROVISIONS Article 173(1) By the time this Law comes into effect, the Law Number 11 of Year 1967 concerning Main Terms of Mining (State Gazette of the Republic of Indonesia of Year 1967 Number 22, Supplement to State Gazette Number 2831) shall be revoked and stated to be void.(2) At the time this Law comes into effect, all legislations which constitute implementation regulations of Law Number 11 of Year 1967 concerning Main Provisions in Mining (State Gazette of the Republic of Indonesia of Year 1967 Number 22, Supplement to State Gazette Number 2831) shall be stated to remain in effect provided that they are not contradictory to the provisions of this Law. Article 174The implementation regulation of this Law must have been stipulated within 1 (one)year since promulgation of this Law. Article 175This Law comes into effect from the date of promulgation.For public cognizance, orders promulgation of this Law by its placement in the StateGazette of the Republic of Indonesia. 78
  • Ratified in Jakarta on the date 12 January 2009 of THE PRESIDENT OF THE REPUBLIC OF INDONESIA, DR. H. SUSILO BAMBANG YUDHOYONO Promulgated in Jakarta on the date 12 January 2009 ofTHE MINISTER OR JUSTICE AND HUMAN RIGHTS OF THE REPUBLIC OF INDONESIA, ANDI MATTALATTA 79