This document summarizes the results of a permit review conducted by civil society groups in Indonesia. The review examined permits issued for forestry, plantation and mining industries in nine regions. The review found violations in 6 permits - 3 in forestry and 5 in plantations. In mining, researchers were unable to determine if violations occurred as over 68% of required documents were not obtained. Overall, only half of the 635 required documents were obtained, indicating a lack of transparency. The results confirm poor governance in Indonesia's permit system for land-based industries. Recommendations include a comprehensive review of all issued permits, law enforcement for violations, and reforms to make the system more integrated, transparent and accountable. Civil society

2. CIVIL SOCIETY
MONITORING NATURE:
A Review of Permits for Land-Based Industries
December 2013
Writing Team
Ohiongyi Marino Pandapotan
Henri Subagiyo
Editor
Frans R. Siahaan
Photo
Courtesy of Armin Hari: coal mining in East Kalimantan
Printed on recycled content paper
This report was produced with support from the UK Climate Change Unit (UKCCU). The opinions,
findings, interpretations and summary expressed in this report are those of the civil society groups
involved and do not reflect those of the Asia Foundation and UKCCU.

3. Permit Review i
Introduction
This permit review is a civil society initiative that aims to foster accountability in the process of grant-
ing permits to land-based industries. It was motivated by the chaotic state of the permit process,
which is a contributing factor to increased deforestation and land degradation.
The permit review is part of the SETAPAK Program, Asia Foundation funded by the United Kingdom
Climate Change Unit (UKCCU). SETAPAK Program focused on improving forest and land governance
in Indonesia, to achieve the overall goal of reducing greenhouse gas emissions. The SETAPAK Pro-
gram supports the efforts of civil society organisations in Indonesia to play a role in promoting good
forest and land governance, including debating government policy and overseeing its implementa-
tion in order to achieve sustainable development.
Increasing permit governance in the forestry, plantation and mining sector is critical to reducing
deforestation, reducing greenhouse gas emissions, conserving natural resources and contributing to
social and economic justice in resource use for Indonesia. It is hoped that the results of the review
will contribute to efforts to improve permitting, functioning as a monitoring instrument for civil soci-
ety to examine and evaluate the process of land and forest allocation through the licensing system,
and to promote improved law enforcement.
We extend our thanks to UKCCU for the support, and to the ICEL writing team for their contribu-
tion. Many parties helped in the process of conducting a permit review to produce this policy paper.
For that we thank the researchers in the field who helped the research process in nine study areas,
namely: Agus Budiman and Leziardi (Gemawan); Ari As’ari and Rangga (Titian); Ilham Jaya Rosdiana,
Hariansyah, Khairul Razikin, and Yudistira (Stabil); Febri Irwansyah and Awaliah Rahmah (Walhi Sum-
sel); Sudirman and Muhammad Farhan (Pilar Nusantara); as well as Deddy Permana and Aprillino
(Wahana Bumi Hijau). We also extend our thanks to Frans R. Siahaan who edited this policy paper.
And we also cannot forget to thank Blair Palmer, Prayekti Murharjanti, and Alam Suryaputra from
the Asia Foundation who gave their input and support for this policy paper to be published.
We are aware that this policy paper still contains many shortcomings. For that reason, we always
welcome recommendations and criticisms from readers to improve our research in the future. Fi-
nally, we hope that this paper will be useful for developing a better permit system for all.
Jakarta, December 2013

4. Permit Reviewii
CONTENTS
Introduction ................................................................................................................................ i
Contents ...................................................................................................................................... ii
List of Tables and Graphs ............................................................................................................ iii
Executive Summary .................................................................................................................... iv
Why a Permit Review? ................................................................................................................ 1
How Was the Review Conducted? ............................................................................................. 2
Were Permit Violations Found? .................................................................................................. 4
What Is the State of Public Access For Conducting Monitoring? ................................................ 6
Conclusion .................................................................................................................................. 11
Recommendations ..................................................................................................................... 11

5. Permit Review iii
List of Tables and Graphs
Tables
Table 1. Authority to Issue Business Permits in Three Sectors .................................................. 3
Table 2. Research Sample ........................................................................................................... 4
Graphs
Graph 1. Stages of a Permit Review ............................................................................................ 2
Graph 2. Violations Found .......................................................................................................... 5
Graph 3. Documents Obtained in Three Sectors ......................................................................... 7
Graph 4. Documents Obtained Related to HTI Plantation Forest Permits .................................. 8
Graph 5. Documents Obtained Related to Plantation Permits .................................................... 8
Graph 6. Documents Obtained Related to Mining Exploration ................................................... 9
Graph 7. Documents Obtained Related to Mining Exploitation .................................................. 9
Graph 8. HTI Plantation forest permit Documents Obtained in the Areas of Study .................... 10
Graph 9. Plantation Permit Documents Obtained in the Areas of Study ..................................... 10
Graph 10. Mining Exlporation Permit Documents Obtained in the Areas of Study ..................... 10
Graph 11. Mining Exploitation Permit Documents Obtained in the Areas of Study .................... 11

6. Permit Reviewiv
Executive Summary
Aside from giving assurance and protection to businesses, permits are instruments to monitor and
control the use of natural resources to ensure that it conforms with social, economic and environ-
mental interests. It cannot be denied that the permit process in Indonesia is rife with problems. The
chaotic state of the permit process has already contributed to increased rates of deforestation, land
degradation, natural disasters, environmental destruction, and even impacted on poverty. This also
shows the poor state of land and forest governance, which is closely related to corruption.
These conditions form the background to the need for a review by civil society. This review aims to
determine whether permits issued by governments are in line with applicable procedures and pro-
visions by studying various documents required to apply for a permit. The review focuses on nine
study areas, namely the provinces of South Sumatra, West Kalimantan, and East Kalimantan, and
the districts of Musi Banyuasin, Musi Rawas, Sintang, Kubu Raya, Berau, and Bulungan. The permits
under review are the industrial timber permit (HTI), plantation permit, and mining permit, using
samples from the study regions. The review method involves taking samples based on the estimated
availability of permit documents. These documents are then studied and compared against prevail-
ing laws and regulations.
The review identified six permits that violated applicable conditions. In the forestry sector, three
conditions were found to be violated, and another five in the plantation sector. In the mining sector,
the researchers were unable to ascertain whether there were violations or not, as more than 68% of
the documents required for review were not obtained. The review process also highlighted the lack
of transparency in the permit sector. From the 635 documents that were required, only half were
obtained, and the worst conditions in this respect were found in the mining sector. This finding raises
concern for public access to information for the purpose of monitoring the permit-granting process.
Weak monitoring can enable deforestation and land degradation, and thus natural disasters, envi-
ronmental destruction, and even poverty.
The results of this review confirm the poor state of governance in the permit process for land-based
industries. Based on its findings, recommendations to the central government include to conduct an
in-depth review of all permits that have already been issued, to follow up on findings of violations
with law enforcement, and to make improvements to the permit system to ensure that it is inte-
grated, transparent, and accountable. Recommendations to civil society include to conduct permit
reviews on a massive scale and to continually use the results as a basis for advocacy to improve the
permit system and the state of law enforcement.

7. Permit Review 1
Why a Permit Review?
Permits in the natural resources sector, aside from giving assurance and protection to businesses
for their activities, also serve as an instrument for monitoring and controlling the use of natural
resources in line with social, economic and environmental interests such as those mentioned in the
legislation. Through the instrument of permits, governments can ensure that businesses comply
with the prevailing regulations. Meanwhile, for businesses, permits can be used as a point of refer-
ence in applying for and carrying out business activities. For communities, especially those poten-
tially impacted by business activities, permits are useful as monitoring instruments, both to monitor
businesses in carrying out their activities, and to monitor governments in issuing permits.
From the aspect of legislation, the permit-granting process is not easy, as businesses must fulfill
several administrative and technical requirements. And yet for land-based industries, such as for-
estry, plantations, and mining, the process appears to have beome very easy. The massive scale of
permits granted in these three sectors has contributed to increased rates of deforestation. In 2011
alone, the national rate of deforestation reached 450,637 hectares (Ha) per year according to official
government figures. Meanwhile, at the provincial level in East Kalimantan, West Kalimantan, and
South Sumatra, the rate of deforestation was as much as 33,977 Ha per year, 41,738 Ha per year, and
13,596 Ha per year respectively.
Aside from that, permits are often issued without considering environmental carrying capacity. For
example, based on data from the Mining Advocacy Network (JATAM), the area of land covered by
mining permit types KP and PKP2B in the municipality of Samarinda is as much as 50,742.76 Ha or
71% of the total area. It is not surprising that such policies contribute to the worsened state of the
environment in Samarinda as shown by frequent floods and unfilled former mine pits, which has
claimed 11 lives since 2011.
Aside from environmental aspects such as deforestation, the massive number of permits granted
also has an impact on increased rates of social conflict. Research by Widiyanto et al showed that in
November 2012 there were 232 agrarian conflicts and other conflicts over natural resources in 22
provinces. On the island of Kalimantan alone, 2012 data showed that 108 conflicts occurred in the
plantation sector, 28 in the forestry sector, and 13 in the mining sector. These conflicts were caused
by several factors, including the limited area of forest zone (kawasan hutan), overlapping land titles,
and weak application of the principle of Free, Prior, and Informed Consent (FPIC).
From an economic perspective, the huge number of permits granted has boosted growth for land-
based industries in Indonesia and made a significant contribution to Gross Domestic Product (GDP).
In 2012, GDP reached 7,422.8 trillion rupiah, with the agriculture sector (including forestry and plan-
tations) and the mining sector contributing as much as 14.70% dan 11.85% respectively. Theo-
retically, if GDP rises then public revenue will also rise, which in turn will reduce rates of poverty.
Unfortunately, this has not been the case. Data from 2013 showed that as much as 21% of those in
communities living in, or close to, forests are categorized as poor.
1
Forestry Ministry, 2012, Indonesian Forestry Statistics (Statistik Kehutanan Indonesia) 2011, Forestry Ministry of the Republic of Indonesia, Jakarta.
2
Forestry Ministry, 2012, Indonesian Forestry Statistics (Statistik Kehutanan Indonesia) 2011, Forestry Ministry of the Republic of Indonesia, Jakarta.
3
Jatam, 2010, Dredging Killer Coal & Kalimantan’s Gloomy Generation (Mautnya Batubara Pengerukan Batubara & Generasi Suram Kalimantan), Jakarta, p. 25.
4
http://daerah.sindonews.com/read/2013/06/24/25/753544/warga-samarinda-gugat-pemerintah
5
http://www.jatam.org/saung-berita/minerba/223-lobang-bekas-tambang-kembali-telan-korban-jiwa-.html; see also http://www.thejakartaglobe.com/news/boy-
drowns-in-disused-kalimantan-mining-pit/.
6
Widiyanto et al, 2012, Outlook on Agrarian Conflicts and Conflicts Over Natural Resources (Outlook Konflik Sumberdaya Alam dan Agraria) 2012, HuMa Information
and Database Center, Jakarta, p. 3.
7
Map of Agrarian Conflicts and Conflicts Over Natural Resources (Peta Sebaran Konflik Agraria dan Sumberdaya Alam) - http://geodata-cso.org/index.php/page/index/6.
8
Widiyanto et al, 2012, Outlook on Agrarian Conflicts and Conflicts Over Natural Resources (Outlook Konflik Sumberdaya Alam dan Agraria) 2012, HuMa Information
and Database Center, Jakarta, p. 3.
9
Central Statistics Agency, 2013, Press Release (Berita Resmi Statistik), Jakarta.

8. Permit Review2
In the province of East Kalimantan, for example, where more than 50% of the Gross Regional Do-
mestic Product (GRDP) comes from the mining sector, more than 6% of the population is still living
below the poverty line. At the district level, Musi Banyuasin can be used as an example. With the
highest GRDP in the province of South Sumatra, reaching 53.9 billion rupiah, and the biggest contri-
bution coming from the sectors of mining and agriculture (including forestry and plantations), this
district in fact has the highest levels of poverty in the province, at 18.99%.
This is a sign of the poor state of governance in granting permits. Evidence presented in the trials of
several corruption cases in the natural resources sector show that the poor state of permit govern-
ance is closely related to corruption, collusion and nepotism, including in the stages of fulfilling the
requirements of the permit, in its application, and in monitoring. The latest case to be convicted by
a judge was a bribery case involving Amran Batalipu, the former district head of Buol, who was sen-
tenced to seven years and six months in jail for corruption in issuing a palm oil plantation permit to
PT Hardaya Inti Perkasa.
The poor state of the permit system in the sectors of forestry, plantations, and mining has spurred
the initiative from civil society to conduct this permit review. Three important reasons why this
review is necessary are, firstly, because of the lack of certainty that existing permits were granted
based on the prevailing legislation. Secondly, based on the first hypothesis, because it is very difficult
to expect that governments are carrying out their responsibilities to conduct monitoring of permits
that have already been issued. Thirdly, because of the importance of protecting land and forests
from illegal activities that can damage communities and the environment in the long-term by put-
ting pressure on, or constricting, their range of movement. It is hoped that this review, conducted
under the initiative of civil society, can be used by governments and by civil society itself to push
for accountability in the permit-granting process and in the monitoring of permits that have already
been granted.
The Review Process
This permit review was conducted by comparing data
or documents needed to request a permit against re-
quirements outlined in the prevailing legislation. In
the initial stage, the researchers examined the leg-
islation and any amendments to determine the con-
ditions that should be referenced in issuing permits
and conducting business. Each amendment gives a
different legal implication to the permit-granting pro-
cedure. The main provisions determined by the leg-
islation were then used as study tools and outlined
in a manual. The researchers then reviewed data or
9
Keynote Speech by the Forestry Minster at a Public Lecture at Sam Ratu Langi University in Manado, 8 November 2013,
http://ppid.dephut.go.id/pidato_kemenhut/browse/31, accessed 29 November 2013. See also: ‘Forestry Minister: 21 Percent of Communities Living Near Forests Are
Poor’ (‘Menhut: 21 Persen Masyarakat Sekitar Hutan Miskin’), 18 August 2013,
http://www.republika.co.id/berita/nasional/umum/13/08/18/mrqk6j-menhut-21-persen-masyarakat-sekitar-hutan-miskin, accessed 29 November 2013. Statistics
Indonesia, 2013, op cit.
10
Ibid., p.
11
Ibid., p. 48.
12
Ibid., p. 152.
13
http://www.tempo.co/read/news/2013/02/11/063460607/Bekas-Bupati-Buol-Amran-Divonis-75-Tahun-Penjara.

9. Permit Review 3
documents needed to lodge a permit application to assess their conformity to the provisions in the
manual, which was used to identify whether violations had occurred.
The samples used in this permit review were made up of sample permits at the provincial and dis-
trict/municipal level. Samples at the provincial level were permits that were issued by the governor
in accordance with legislation. The governor has the authority to issue permits for business activities
that cross district or municipal borders. Meanwhile, samples at the district or municipal level were
taken from permits issued by the district head or mayor in accordance with the legislation. The dis-
trict head or mayor has the authority to issue permits that are located in his or her own district or
municipality. Based on the authority to give permits in each sector, the authority of central and local
officials (provincial and district or municipal) to give permits can be seen in Table 1 below.
Table 1. Authority to Issue Business Permits in Three Sectors
The permits reviewed in this study are the industrial plantation forest permit (HTI), palm oil plan-
tation business permit (IUP), and the mining business permit (IUP), previously known as a mining
permit (KP) before the passage of Law No. 4/2009 on Mineral and Coal Mining. In securing these
permits, other prerequisite permits must first be obtained, including permits for borrow-use, loca-
tion permits, environmental permits, permits for release of forested land, and cultivation (HGU)
permits, among others.
The permit review was conducted in three provinces, namely South Sumatra, West Kalimantan, and
East Kalimantan, as well as six districts, namely the districts of Musi Banyuasin, Musi Rawas, Sintang,
Kubu Raya, Berau, and Bulungan. The study areas were chosen for their strategic position in national
forestry, based on the area of forest zone and rate of deforestation and forest degradation. The total
area of forest zone included in the study areas reached 27,941,765 Ha or 21% of the total forest zone
of Indonesia.
(131,279,115 Ha). East Kalimantan – which at the time of the study still included the now sepa-
rated province of North Kalimantan – had the second greatest area of forest zone in Indonesia,
at 14,651,053 Ha or 11% of the national total. Meanwhile, West Kalimantan had 8,990,875 Ha of
forest zone, and South Sumatra had 8,990,875 Ha, or 7% and 3% of Indonesia’s forest zone areas,
14
Forestry Ministry, 2012, Indonesian Forestry Statistics (Statistik Kehutanan Indonesia) 2011, Forestry Ministry of the Republic of Indonesia, Jakarta.
15
Ibid.

10. Permit Review4
respectively. In terms of deforestation and forest degradation, the three study areas contribute ap-
proximately 20% of Indonesia’s annual deforestation, according to official figures in 2011.
Initially, the selection of samples in this study was to be based on the criteria of the most extensive
forest areas where for each region 10% was covered by permits in each sector (forestry, plantations,
and mining). But because of the difficulties in accessing data, the sample selection was instead made
based on estimates of the availability of the documents or data. The consideration of obtaining
permit documents for each sample then became a top priority in conducting the permit review. Us-
ing this method, 33 permits were taken as samples, specifically 8 HTI plantation forest permits, 17
plantation permits, and 8 mining permits. A complete list of the research samples can be seen in
Table 2 below:
The success of the permit review depended heavily on the accessibility of permit documents and
data. For this reason, a graph showing the accessibility of permit documents and data is also pro-
vided in this section. In obtaining documents and data, information was requested in accordance
with the standards regulated by Law No. 14/2008 on Freedom of Information (FOI Act, UU KIP). The
important documents or data generally needed to conduct a permit review are the business per-
mit decision letter, Environmental Impact Analysis (AMDAL) document, a recommendation from the
district head/governor, a borrow-use permit (izin pinjam pakai kawasan hutan) or permit to release
forested land (izin pelepasan hutan), and a letter of environmental feasibility.
In order to maximize the availability of documents and data, a network approach was also used in
instances where the FOI Act failed, for example by requesting documents or data from a contact
person at a related institution, non-governmental organization, or library.
Permit Violations
The results of the permit review were grouped under 3 categories, namely: (1) No Violation Found;
(2) Violation Found; and (3) Unknown (whether there was a violation or not). The three categories
were defined using the the following assessment criteria:
1. No Violation Found. Companies were said to have “no violation found” if all permit requirements
regulated by law were fulfilled.
Table 2. Research Sample

11. Permit Review 5
2. Violation Found. Companies were said to have a “violation found” if there was a violation discov-
ered in one or more permit requirements as regulated by law.
3. Unknown whether there was a violation or not. Companies fell into the “unknown” category if
no violations were found in the limited permit documents that were obtained.
From the 33 permits that were reviewed, not one could be confirmed to be free of violations, as the
data could not be accessed in full. The findings showed that at least six permits violated the condi-
tions of prevailing legislation. These six permits were made up of 3 HTI plantation forest permits
from a total of 8 reviewed, and 3 plantation permits from a total of 17 reviewed. 27 other permits
could not be confirmed as being free of violations because the permit documents could not be ob-
tained in full for review.
In the forestry sector, three violations were found, namely:
(1) Forestry activities taking place outside production forest areas. Based on Article 28 Paragraph 2
of Law No. 41/1999, production forests may only be used if a business has already secured a per-
mit for the use of timber products in a production forest area. One company in Musi Banyuasin
violated this provision.
(2) The bidding procedure was not properly followed, for example: (a) by businesses not holding a
Tender Winner’s Certificate. This is in violation of Article 18 Paragraph 6 of Forestry Minister’s
Decree No. P.10/Menhut-II/2004 on Amendments to Forestry Minister’s Decree (Permenhut)
No. P.05/Menhut-II/2004 on the Granting of Business Permits to Use Forest Timber Products,
which states that every winner of a tender is obliged to apply for a certificate from the Forestry
Ministry. One company in Musi Banyuasin was found to have violated this provision; (b) by ignor-
ing the outcome of a tender. One company in Musi Banyuasin was found to have ignored docu-
ments that stated the area of land to be used by the company was 66,055 Ha, and printed in its
plantation forest permit (IUPHHK-HTI) that it was given 67,100 Ha. This meant that there was
a discrepancy between the SPPL and the IUPHHK-HTI of 1,045 Ha. It is worthy of note that the
plantation forest permit in question is still being used on a productive plot of land.
(3) The area was still under a permit held by a third party. Based on Article 3 Paragraph 1 of Forestry

12. Permit Review6
Minister’s Regulation P.19/Menhut-11/2007, the areas where forested land can be developed
are production forests that are no longer productive and not already covered by another permit.
In reality, one company in Musi Rawas had applied for an IUPHHK-HTI plantation forest permit in
an area where a permit was still in place for another company (that is, the permit was still recog-
nized by the Forestry Ministry).
In relation to the violation of permits in the forestry sector, from the nine study areas, accessing data
in the districts of Musi Banyuasin and Kubu Raya was comparatively easier than in the other seven
areas. Three violations to the fulfillment of permit requirements were found in the review, including
in both of the aforementioned districts. Details of the violations in these two districts are as follows:
(1) One permit violated three conditions, namely: (a) by not having a recommendation for permit
location from a defense agency; (b) because the area of land granted exceeded that allowed in
the relevant regulations; (c) by not fulfilling local requirements. These violations were made by
one company in Musi Banyuasin.
(2) One permit violated the condition that others’ rights to the same land must be settled. One
plantation of 15,500 Ha was found to be operating since 2003 in a location still claimed by the
community. One condition for receiving a plantation business permit is that at the time of the
expiration of the location permit the permit-holder should have fulfilled its obligation to the third
party in accordance with the prevailing regulations. This violation occurred in Kubu Raya.
(3) One permit did not have a letter of environmental feasibility (SKLH) at the time it began opera-
tions. A company that started operations in 2006 did not acquire the relevant SKLH until 2008.
This document is a precondition for obtaining a business permit, or in this case a plantation busi-
ness permit. This violation occurred in Musi Banyuasin.
Violations in the mining sector were unable to be confirmed because more than 68% of the required
documents for review could not be obtained. This shows that the permit process for the mining sec-
tor is less transparent than that of the forestry and plantation sectors.
The above violations reflect weaknesses in the government’s ability to monitor and control busi-
nesses in forestry, plantations, and mining. This limits the ability of the existing permit process to
ensure industry compliance for the duration of their activities, if in the beginning stages alone there
are already many violations in the permit-granting process.
Public Access For Monitoring Permits
A permit review requires adequate availability of permit documents. This permit review experienced
great difficulties in this regard because access to permit documents was very limited. If access to
information related to permit documents is not improved, it will remain difficult for communities to
effectively conduct monitoring. Permit documents are open documents according to the Law on the
Disclosure of Public Information (UU-KIP). Based on Article 11 of this law, the decision of a public
body and its considerations as well as all supporting policies and documents must be made readily
16
Indonesian Forestry Law No. 41/1999 (Undang-Undang tentang Kehutanan, UU No. 41 Tahun 1999), Government Gazette 1999 No. 167, Explanation of Article 28
Paragraph 1: “The exploitation of forested land should prioritize forests that are not productive in the interest of protecting natural forest” (“Pemanfaatan hutan tana-
man diutamakan dilaksanakan pada hutan yang tidak produktif dalam rangka mempertahankan hutan alam”). This explanation does not clearly state that those given
permits to use forested land are still obliged to consider this issue.

13. Permit Review 7
available. A permit document is a public body decision, or policy in the technical sense.
Although transparency is guaranteed by law, in practice many permit documents cannot be ac-
cessed. For this study, many approaches were used to gain access to permit documents, starting
from requesting the documents according to law from the authorized agency up to using a network
approach, by asking for documents from certain parties in government agencies, academia, and
non-governmental organizations who may be able to help in obtaining documents. However, many
documents still could not be obtained.
From the 635 important documents needed for this permit review, 50% could not be obtained. In
the forestry sector, from the 80 documents needed, 43 (54%) were obtained and 37 (46%) could
not be obtained. In the plantation sector, from a total of 323 documents needed, 208 (64%) were
obtained, and 115 (36%) were not obtained. Meanwhile, in the mining sector, from a total of 112
documents related to mining exploration permits that were needed, 76 documents (68%) could not
be obtained and only 36 documents (32%) were available. Many more documents related to land
use permits were difficult to access. From 120 documents needed, 90 of them (75%) could not be
obtained, while only 30 documents (25%) could. Graph 3 shows the availability of documents in the
three areas of study.
For the HTI plantation forest permit, the documents that were hardest to obtain were technical
proposals, IUPHHK permit documents, and evidence of payment for the IUPHHK. From a total of 80
documents needed, as many as 37 could not be obtained. The types of documents that could not
be obtained can be seen in Graph 3. Meanwhile, the documents that were relatively easy to obtain
were the environmental feasibility document and company domicile certificate (SKD). The following
graph shows the documents needed
for an HTI permit that could not be ob-
tained:
The findings in this area of study
showed that many documents related
to HTI plantation forest permits were
not held by regional governments. Al-
though the authority of issuing the
permits belongs to the central govern-
ment, the local governments should
also have documents relating to the
HTI permit because the permits can
only be issued after a recommendation
is made by the local head of govern-
ment (governor or district head/mayor). This indicates the weakness in coordination and lack of
integration in the permit system between the central and regional governments. One reason for this
is the lack of strong legislation regarding the exchange of permit documents between the central
and local governments. This results in limited access to information by civil society, particularly local
communities most affected by these permitting decisions.
Documents related to plantation business permits that were the most difficult to obtain were letters
17
Agriculture Ministry of the Republic of Indonesia, Agriculture Minister’s Decree No. 352/2002 on Plantation Business Permit Guidelines (Keputusan Menteri Pertanian
No. 352 Tahun 2002 tentang Pedoman Perizinan Usaha Perkebunan), states that the maximum area of land allowed for plantation companies is 20,000 Ha in one
province, or 100,000 Ha in the whole of Indonesia, except for sugar plantations. However, the fact is that the aforementioned plantation received a permit for an area
of 44,000 Ha.

14. Permit Review8
by the companies/applicants stating that the land has not been claimed by a third party, technical
recommendations from the governor or district head, as well as plantation business permits and
requests. From a total of 323 documents needed for review, the 208 which were obtained were of
the types shown in Graph 5. Documents that were relatively easy to obtain were the Environmental
Impact Analysis (AMDAL), Environmental Management (UKL), and Environmental Monitoring (UPL)
forms, documents to release forested land and statements on the control of plant pests. Below is a
graph showing the plantation permit documents that could and could not be obtained:

15. Permit Review 9
The documents related to exploration permits that were the most difficult to obtain were those that
contained proof of the deposit of reclamation guarantee funds, reclamation plans, and use permits.
From a total of 112 documents needed for review, 76 documents were unavailable and can be seen
in more detail in Graph 6 below:
Documents related to exploitation permits that were difficult to obtain included proof of deposit
of reclamation guarantees for exploration and exploitation, proof of deposit of post-mining guar-
antees, reports of environmental feasibility studies, exploration reports, proof of payment of fixed
fees, and permit request letters. From a total of 120 documents needed for reviews, 90 documents
could not be obtained. For more detail, see Graph 7 below:

16. Permit Review10
The findings showed that the districts of Berau and Musi Banyuasin were the areas where it was
most difficult to obtain documents related to HTI plantation forest permits. For documents related
to plantation business permits, the areas of difficulty were the province of South Sumatra, and the
districts of Musi Rawas and Berau. Meanwhile, for documents related to mining exploration permits,
these were most difficult to access in the districts of Bulungan and Musi Rawas. Documents related
to mining exploitation permits were most difficult to access in the provinces of South Sumatra, East
Kalimantan, and West Kalimantan. See Graphs 8, 9, 10 and 11 below:

17. Permit Review 11
Conclusions
1. Not one permit reviewed could be said to be free of violations. Six permits were found to violate
provisions of prevailing legislation, including three HTI plantation forest permits and three plan-
tation permits. Meanwhile, the remaining 27 permits under review could not be said to be free
of violations because not all documents were available for review.
2. Three violations were found in the forestry sector, namely: (a) Forestry activities conducted out-
side production forest areas; (b) Tender procedures that were not correctly followed; and (c)
Land where permits were issued that were not yet free from third-party claims.
3. In the plantation sector, in reviewing 3 plantation business permits, five violations were found,
namely: (a) The absence of environmental feasibility certificates; (b) Overlapping claims over
land; (c) The absence of a location permit recommendation from a defense agency; (d) Area of
the plantation business permit exceeding that of prevailing legislation regarding the maximum
area allowed for plantations; and (e) Unfulfilled permit location requirements, such as the area
of land used exceeding that determined in the legislation (more than 20,000 Ha per province).
4. In the mining sector, the researchers were not able to determine whether violations had oc-
curred or not, as more than 68% of the required documents could not be obtained. This issue
also shows that permits in the mining sector are less transparent than those in the forestry and
plantation sectors.
5. The weak application of public information laws with regards to permits is a major obstacle for
civil society to conduct monitoring of the permit process. Aside from that, inter-agency coordina-
tion between the central and local governments and between sectors is important in ensuring
that the permit system is integrated, transparent and accountable.
6. The monitoring function of the provincial and central governments is not working as it should,
both in terms of transparency and management in the permit process.
Recommendations
A. For Governments
(1) The six suspected permit violations found by the researchers should be followed up by law en-
forcement, in accordance with the prevailing legislation. The government and law enforcers

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should verify and further investigate the suspected violations using the appropriate measures
(administrative action, civil code, criminal code).
(2) The permit system should be improved, especially in the following areas:
a. By making permit information publicly available in order to enable the public and the govern-
ment to monitor the compliance of industry activities based on permits and their supporting
documents.
b. By developing integrated land maps (maps showing not only land area but also rights over
land and other conditions) to help in the decision-making process. Various findings related
to this issue include: (i) the unsuitability of land given for activities both from the aspect of
area as well as productive conditions; (ii) the high rate of overlapping land permits; (iii) other
problems mentioned in the report. The government’s “one map” inititiative needs to be ac-
celerated and implemented by all agencies both at the center and in the regions.
c. By strengthening inter-agency coordination among the central and local goverments, as well
as between sectors to promote a more integrated permit system.
d. By the central government conducting monitoring and exercizing control over permits for
land-based industries.
(3) An in-depth review needs to be conducted to assess all permits currently held by land-based
industries bearing in mind the findings of this study, which found a high rate of violations in the
permit process in the nine regions studied.
B. For Civil Society
(1) Permit reviews should be conducted in an ongoing manner, as a form of monitoring issued per-
mits to encourage compliance with prevailing laws and better law enforcement, both indepen-
dently by communities and by governments.
(2) Civil society actors should follow up the results of permit review monitoring with the related
agencies, such as law enforcers, authorized governments, and so on.
(3) The system needs to be strengthened both in the practice of providing open access to informa-
tion in the permit sector by increasing the frequency of requests for information and the filing
of information disputes. This will help to overcome the major problem for permit monitoring,
namely the minimal amount of documents able to be accessed because transparency of the per-
mit process is still weak.
(4) Networks and independent means of spreading information need to be strengthened between
community groups to overcome limitations to accessing information that can be used to monitor
permits.
(5) The importance of improving the permit process needs to be voiced and advocated to authorized
agencies both at the center and in the regions in order to protect natural resources, the environ-
ment and the rights of communities.

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20. Permit Review14