The Constitutional Court once again held a hearing for Case No. 21-22/PUU-V/2007 regarding the judicial review of Law No. 25 Year 2007 on Capital Investment (the Capital Investment Law) against the 1945 Constitution on Tuesday (20/11), at the Constitutional Court’s plenary session hall with the agenda of Hearing the Statements of the Experts presented by the Petitioners and the Government.

Case No. 21/PUU-V/2007 was filed by ten institutions, namely, among other things, the Indonesian Legal Aid and Human Rights Association (PBHI), Greater Jakarta Labor Unions’ Federation (FSBJ), Indonesian Farmers’ Alliance (API), Sadajiwa Village Development Foundation (YBDS), Women Solidarity Union (PSP), Indonesian Farmers’ Union Federation (FSPI), Indonesian Forum for the Environment (WALHI), Agricultural Reform Consortium (KPA), Voice of Indonesian Human Rights (SHMI), and Association of Facilitators for Small-Scale Woman Entrepreneurs (ASPPUK). Meanwhile, the petition for the judicial review of Case No. 22/PUU-2007 was filed by Daipin cs. with their Attorneys Patra M. Zen, S.H., LLM. cs. of the Indonesian Legal Aid Institute Foundation (YLBHI).

In their petitum, the Petitioners in Case No. 21/PUU-V/2007 requested the Council of Constitutional Justices to declare that the substances of Article 3 Paragraph (1) Sub-Paragraph d, Article 4 Paragraph (2) Sub-Paragraph a, Article 8 Paragraph (1), Article 12 Paragraph (4), and Article 22 Paragraph (1) Sub-Paragraphs a, b and c are contradictory to Article 33 Paragraph (2) and Paragraph (3), Article 27 Paragraph (2), Article 28A and Article 28C of the 1945 Constitution, while the Petitioners in Case No. 22/PUU-V/2007 requested the Council of Constitutional Justices to declare that Article 1 Paragraph (1). Article 4 Paragraph (2) Sub-Paragraph a, Article 8 Paragraph (1) and Paragraph (3), Article 12 Paragraph (1) and Paragraph (3), Article 21, Article 22 Paragraph (1) and Paragraph (2) of the Capital Investment Law are contradictory to the 1945 Constitution.

In the grounds of their petition, the Petitioners claim that the Capital Investment Law provides various “luxuries” for the sake of attracting investments, ranging from various tax privileges, the granting of Right of Cultivation for 95 years all at once, the freedom to transfer one’s capital whenever and wherever, to the freedom from nationalization issues. On the other hand, the existing external costs of capital investment such as thousands of land disputes, human rights violations, environmental damages and impoverishing acts are not taken into account in the drafting of the Capital Investment Law by the Government and the People’s Legislative Assembly of the Republic of Indonesia (DPR-RI).

According to the Petitioners, the Capital Investment Law prioritizes investments as the pillar of economic development. This in fact, as the Petitioners describe, has many flaws because it ignores the principle of equal income distribution, resulting in a wider gap between the rich and the poor. On the other hand, most of the Indonesians are still living in poverty and cannot afford to access natural resources, healthcare, education, and other public services. These are the issues that, according to the Petitioners, violate the constitution and betray the aspiration of the national economic development, which is based on the values of democracy, or, in other words, the economy of Pancasila (the Five Principles of Indonesia).

The statements of the Experts presented by the Petitioners and the Government were heard in the hearing. The Experts presented by the Petitioners were, among others, Jayadi Damanik, Revrisond Baswir, Zohra Andi Baso and Salamudin Daeng, while the Experts presented by the Government were, among others, Asril Noer, Bungaran Saragih, Faisal Basri, Ismail Suny, Felix O. Soebagyo and Kurnia Toha.

Generally, the Petitioners’ experts viewed the Capital Investment Law as a law derived from a therapy based on a false diagnosis. “I still believe that if Article 33 Paragraph (2) had been interpreted correctly and applied appropriately, there would not have been a problem in the implementation of the law,” Baswir stated.

At the other end, the Government’s experts were of the opinion that the actual problem was not the substance of the Capital Investment Law, but the Government’s marginal performance in its effort to prosper the people. “The problem is not in the law which is claimed as discriminatory, but it lies within the state-level management, in this case, the Government,” Faisal Basri, an economist, argued.

Quoting Supomo, Faisal stated that no matter how great the legislation is, a state will be chaotic if the state administrators are disorganized. Moreover, with respect to the aforementioned Government’s weakness, Faisal also exemplified that apparently, in terms of investment, regions have never received anything until now but the income from Land and Building Tax. “All tax incomes directly go to the central [Government] and, as a result, regions receive nothing,” Faisal explained. (Wiwik Budi Wasito)

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