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Thanks to Jobs Law, thousands of illegal palm oil companies let off the hook

CNN Indonesia - November 22, 2023

Jakarta – The Ministry of Environment and Forestry (KLHK) has ensured that thousands of illegal oil palm companies operating in forest area have been exonerated or legalised thanks to the Omnibus Law on Job Creation.

"More than 1,000 companies according to national data [have been included in the legalisation list]", said the Director General of Forestry and Environmental Plantology (PKTL), Hanif Faisol Nurofiq, when speaking to reporters in South Jakarta on Wednesday November 22.

Nurofiq explained that thousands of companies had been given time to meet administrative requirements as stipulated under Article 110A of the law. The government gave companies until November 3 to complete or fix the administrative requirements.

Under Article 110A of the Jobs Law it states that, "Companies that are already operating in forest areas, but have a business license, can continue their activities as long as they complete all requirements within a maximum period of three years".

Nurofiq said that if palm oil companies do not complete the administrative requirements, then they will be subject to fines.

He said that the fines are stipulated under a derivative regulation namely Government Regulation Number 24/2021 on Procedures for the Imposition of Administrative Sanctions and Non-Tax State Revenue from Administrative Fines in the Forestry Sector.

Nevertheless, Nurofiq emphasised that the legalisation process does not apply to companies in conservation forest area.

"So if everything is resolved, there is [legal] certainty, except in conservation areas that are not allowed, they must leave", he said.

Earlier, Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Panjaitan said the government had been forced to legalise 3.3 million hectares of oil palm plantations operating in forest area as stipulated under the Jobs Law.

"Yeah, what else could we do, should we have revoked [their licenses], no, use your logic, yeah, we legalised them. We were forced to", said Pandjaitan during a press conference in Jakarta on Friday June 23.

The articles used under the Jobs Law referred to by Pandjaitan are Articles 110A and 110B. Under this policy, companies who have already established business activities in forest areas can apply for release or legalisation. (yla/pmg)


Despite a 2013 law on forest degradation that prohibits activities such as palm oil cultivation and mining in forest areas, thousands of companies have illegally cleared forests and established palm oil plantations. Illegal plantations are estimated to cover some 3.37 million hectares – an area the size of the Netherlands – and account for a significant portion of palm oil production in Indonesia. Instead of requiring that the companies cease operations and restore the cleared forest, the amnesty scheme introduced through the Jobs Law in 2020 gave illegal plantations a grace period of three years to obtain the proper permits, have the area officially rezoned as a non-forest, and after paying the requisite fine resume operations.

[Translated by James Balowski. The original title of the article was "Ribuan Perusahaan Sawit Ilegal Diputihkan Berkat UU Cipta Kerja".]

Source: https://www.cnnindonesia.com/nasional/20231122162715-12-1027642/ribuan-perusahaan-sawit-ilegal-diputihkan-berkat-uu-cipta-kerj