Material judicial review hearing of Law Number 3 of 2020 on Mineral and Coal Mining with agenda to hear the House of Representative's testimony at the Courtroom, Monday (18/11). Photo by MKRI/Ifa.

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JAKARTA, MKRI—Prioritization in WIUPK offers still pays attention to the requirements that must be met. Even in its follow-up, WIUPK is only determined if it has met the criteria for utilizing space and areas for mining business activities in accordance with statutory provisions, reserve resilience, national production capability, and/or fulfillment of domestic needs.

This was the statement conveyed by Member of Commission III of the House of Representatives M. Nasir Djamil in a continued hearing on the judicial review of Law Number 3 of 2020 on the Amendment to Law Number 4 of 2009 on Mineral and Coal Mining (Minerba Law) on Monday, November 18, 2024. Rega Felix filed Case Number 77/PUU-XXII/2024.

Nasir explained that giving priority to state-owned enterprises (BUMN) and regional government-owned enterprises (BUMD) is clearly regulated in Article 75 paragraph (3) of Law Number 3 of 2020. Meanwhile, for private business entities it is clear in Article 75 paragraph (4) of Law 3 of 2020. Apart from BUMN and BUMD which are given priority, IUPK for other business entities can be given through an auction process.

The Petitioner requested that the interpretation of the norm be limited to BUMN and BUMD. According to the House, this results in a repetition of the formulation of the norms in Article 75 paragraph (3) of Law Number 3 of 2020, which has constructed the granting of WIUPK on a priority basis.

"The House of Representatives concludes that the Petitioner's argument that the article a quo is multi-interpretive in giving priority to BUMN and BUMD and gives too broad authority, for example with the establishment of Government Regulation Number 25 of 2024 in mineral and coal management, is unfounded in law. Therefore, the House of Representatives is of the view that there is no issue of norm unconstitutionality arising from the enactment of the article a quo,” Nasir explained in the Plenary Hearing led by Chief Justice Suhartoyo.

The role of private enterprises

Regarding the recognition of the existence of other entities, namely private business entities, the House of Representatives views their existence in mineral and coal management as part of the concept of control by the state based on Article 33 of the 1945 Constitution of the Republic of Indonesia. Private business entities are mostly owned by private parties, both individuals and groups and are established to seek profits in developing businesses, managing non-vital economic resources, and creating jobs.

In addition, private business entities have an important role in providing goods and services needed by the community, namely assisting the government in organizing production activities and helping to increase foreign exchange. Therefore, providing legal certainty in mineral and coal management for private business entities is in line with the concept of economic democracy that recognizes the existence of private business entities to manage minerals and coal.

“Private business entities have a role in increasing state revenue from mineral and coal mining management. As the Ministry of Energy and Mineral Resources noted, the realization of the Non-Tax State Revenue or PNBP, Mineral Resources sector in 2023 reached Rp300.3 trillion or 116% of the target set at Rp259.2 trillion. Thus, the House is of the opinion that Article a quo of Law Number 3 of 2020 has regulated matters that are in accordance with the principles of good legislation to answer legal needs so that it is in line with Article 33 paragraph (3) of the 1945 Constitution of the Republic of Indonesia,” Nasir explained.

Support from the Community Organization

In this hearing, the President/Government presented Fitra Arsil as an Expert. Fitra stated that the priority WIUPK offers to business entities owned by religious mass organizations is a form of government support in managing religious mass organizations. So it is necessary to distinguish between business entities and religious organizations as business entities that are subject to the mechanism of the business entity itself. Religious organizations, as shareholders, will get profits that can be used for widespread prosperity.

Furthermore, Fitra revealed that what needs to be emphasized is that the principle of the relationship between religious organizations and their members is not a form of share ownership relationship. However, religious organizations have stakeholders who are connected in a cultural relationship that serves and works together for the broad public interest. The activities of religious organizations can not only be enjoyed by their officially registered members, but can be enjoyed by the community at large, even across religions. Hospitals, schools, and various social religious activities organized by religious organizations can be enjoyed by the community at large. Therefore, in principle, Article 75 paragraph (3) of the Minerba Law cannot provide the principle limitations provided in Article 6 paragraph (1) letter j of the Minerba Law.

"Because both regulate different issues and basically do not cover the prohibition of WIUPK offers on a priority basis as part of the government's authority. Thus, the interpretation of the central government's authority to carry out WIUPK offers on a priority basis as referred to in Article 6 paragraph (1) letter j of the Minerba Law is not limited to the parties addressed in Article 75 paragraph (3) of the Minerba Law, namely BUMN and BUMD,” Fitra said.

Business Entity Owned by Religious Organizations

Meanwhile, Yetty Komalasari Dewi, who is also an expert presented by the President/Government in her statement, said that WIUPK was not offered to religious organizations, but business entities owned by religious organizations. This is as stipulated in Article 83A of Government Regulation Number 25 of 2024 as an implementation of the authority possessed by the government based on Article 6 paragraph (1) letter j of the Minerba Law. Based on this regulation, WIUPK offers are prioritized to business entities owned by religious mass organizations with a note that it is only limited to the former Coal Mining Concession Work Agreement (PKP2B) area.

“The offer of special mining business license areas in priority to business entities owned by religious organizations, aims to provide opportunities for business entities owned by religious organizations to be involved in mineral and coal mining management, whose benefits can be felt by the wider community and not only certain individuals. Because in fact the beneficiaries of various programs and activities of religious mass organizations, the community at large and not only their members,” Yetty explained.

Also read:

Mining Concession for Religious Groups Challenged

Advocate Clarifies Meaning of 'Priority' in Mining Concession Review by CSOs

House and Govt Request for Minerba Law Hearing Reschedule

Govt: WIUPK Priority Offer Expands Capacity of Minerals and Coal Management

Govt Expert Explains the Capacity of Religious Groups to Manage Mining Sites

An advocate and lecturer, Rega Felix, submitted a judicial review of Article I number 4, which contains amendments to Article 6 paragraph (1) letter j and Article I number 26, which contains amendments to Article 35 paragraph (1) of Law Number 3 of 2020 on Amendments to Law Number 4 of 2009 on Mineral and Coal Mining (Minerba Law) against the 1945 Constitution of the Republic of Indonesia to the Constitutional Court. During the preliminary hearing on Wednesday, July 24, 2024, Rega argued that the WIUPK offered to religious groups as a priority does not satisfy the requirements of affirmative policy based on the 1945 Constitution.

The Government can still carry out priority offers as long as it does not use considerations based on ethnicity, religion, race, and intergroup. If the priority is given based on these considerations, it is clearly contrary to Article 28I paragraph (2) and Article 33 paragraph (3) of the 1945 Constitution. This is because the meaning of “priority” in the norm of the tested article is not clearly limited and may create a self-reference norm to the president.

In the petitum, the Petitioner requested that the Court declares the phrase “prioritizing the offer of WIUPK” in Article 6, Paragraph (1), letter j, as amended by Article I, point 4 of the Minerba Law, to be in conflict with the 1945 Constitution and conditionally without binding legal force as long as it is not interpreted as “prioritizing the offer of WIUPK without considerations based on ethnicity, religion, race, and inter-group.” Furthermore, the Petitioner requested that the clause “Mining businesses are carried out based on business licenses from the central government” in Article 35, Paragraph (1), as amended by Article I, point 26 of the Minerba Law, be declared in conflict with the 1945 Constitution and conditionally without binding legal force as long as it is not interpreted as “Mining businesses are carried out based on business licenses from the central government without considerations based on ethnicity, religion, race, and intergroup.”

Author: Sri Pujianti

Editor: N. Rosi

PR: Fauzan F.

Translator: Rizky Kurnia Chaesario

Disclaimer: The original version of the news is in Indonesian. In case of any differences between the English and the Indonesian versions, the Indonesian version will prevail.

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