The Analysis of Minerba (Nickel) Governance Law in Indonesia: A Juridical and Historical Review
Antonius Setyadi
Master of Law Study Program, Postgraduate Program, Universitas Indonesia antoniusss60@gmail.com
* corresponding author
I. Introduction
The long history of mining activities in Indonesia as a type of non-renewable source shows that Indonesia is a region that has enormous natural wealth. Starting in 1602, the arrival of a group of Dutch traders known as the VOC (Verenigde Ooze Indische Company) also colored the history of mining in Indonesia. Several areas were famous for their mining activities at that time, including Tin on Bangka Island (1710), Belitung Island (1851), and Singkep Island (1887). Coal Mining on Java Island (1854), Asphalt on Buton Island (1909), Nickel on Sulawesi Island (1916), and Bauxite on Bintan Island (1925). In 1899 there were regulations regarding mining called Indische Mijnwet, Stb.
The year 1899 Number 214. Later in its development, there were names such as Ter Braake (1944) and R. W Van Bemmelen (1949), as geologists from the Netherlands who conducted surveys in Indonesia. There are also various annual reports of the Dutch East Indies Mining Service called Jaarverslag Dienst van Den Mijn Bow [1].
Regarding the concession period (1899-1960), the underlying rules stipulated in the Indische Mijnwet 1899 were based on the concept of Western (Dutch) civil law. The concession definition is a permit from the government to clear land and to run a business on it, to open roads, to mine. In Basic Agrarian Law Article 4, paragraph (1), this concession right can be converted into a Cultivation Right [2]. Prof. Atmosudirjo also defined concession by saying: "A state administration determination which is juridically very complex, therefore it is a set of dispensations, permits, licenses accompanied by the granting of limited government authority to the concession holder (concessionary)"[3].
ARTICLE INFO A B S T R A C T
Article history:
Received 14 May 2022 Revised 6 July 2022 Accepted 13 Sept 2022
This study aims to analyze the Minerba (Nickel) Governance Law in Indonesia from the perspective of juridical and historical. The mining business is an activity in the context of mineral or coal exploitation. It includes the stages of a general investigation, exploration, feasibility study, construction, mining, processing and refining or development and utilization, transportation and sales, as well as post-mining, as contained in the Law – Law Number 3 of 2020 concerning Amendments to Law Number 4 of 2009 concerning Mineral and Coal Mining. This study uses normative juridical research; namely, research focused on examining the application of rules and norms, as well as literature studies related to the research under study. While the formulation of the problem is: a) How is the regulation of mineral and coal mining businesses from a review of Law Number 3 of 2020 concerning Mineral and Coal Mining;
and b) What is the legal protection for mineral and coal mining businesses in Indonesia? The results of the study resulted in conclusions including a) The regulation in mining law has changed, namely Law Number 3 of 2020 concerning Mineral and Coal Mining; and b) Legal protection for mining businesses by the government for the benefit of society and in order to give authority to obtain equal rights before the law. Therefore, it is concluded that the relevant fields to be covered by the law must continue to be developed so that the legal mindset can include knowledge about the social context and the impact of government policies or actions. Good law must offer something more than existing procedural justice. The law must have the ability to be fair, provide equal opportunities, help determine the interests of society and hold on to the achievement of substantial justice.
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All rights reserved.
Keywords:
Nickel,
Management in Indonesia
Antonius Setyadi (The Analysis of Minerba (Nickel) Governance Law in Indonesia: A Juridical and Based on the definitions above, it can be seen that the granting of concessions is granting rights to entrepreneurs with broad authority. Even then, the Dutch colonial government issued various kinds of concessions in various sectors of natural resource exploitation activities to benefit Dutch business people and private entrepreneurs. For example, plantation and forestry concessions based on Agrarische Wet have now been converted into Cultivation Rights, currently known as Forest Logging Rights, for a very long term, up to eighty years. At first, this law was in the form of a government regulation in place of law (Perpu), namely Perpu No. 37 of 1960, which was later passed by the DPR to become law. In Law Number 37 Prp. In 1960, the term concession was replaced with mining authority, meaning: authority is given by the government, in this case, the Minister of Mines and Energy, to bodies or individuals to carry out mining business.
In addition, Law Number 10 of 1959 aims to cancel mining rights granted before 1949, and up to 1959, had not been implemented, so this was considered detrimental to the state's development.
Mining rights that had been granted before 1949 but then have yet to be realized. It is due to cancellation according to law, including, among other things: a) “Mining investigation permits whose license period has not yet expired due to the implementation of Article 65 Mijnordonnantie 1930 (moratorium); b) The right to obtain mining concessions as outlined in Article 28 paragraph 3 Indische Mijnwet (Staatsblad 1899 Number 214) as has been frequently amended and supplemented later; c) Mining concessions; d) Agreement under Article 5a Indische Mifnwet to conduct a mining investigation (contract 5a Exploration); e) Agreement based on Article 5a Indische Mijnwet to carry out investigation and mining of minerals (contract 5a Exploration and Exploitation), and f) Mining permits for minerals that are not mentioned in Article 1 Indische Mijnwet” [4]. Law Number 11 of 1967 concerning Basic Mining Provisions also contains changes regarding the principles of policy regulation, including; a) The nature of a mining company; and b) The role of local government is further strengthened. “The regulation on mining includes several derivatives in the form of the Minister of Energy and Mineral Resources Regulation Number 28 of 2009. It was changed to the Minister of Energy and Mineral Resources Regulation Number 24 of 2012; PP Number 22 of 2010, later regulated in the Minister of Energy and Mineral Resources Regulation Number 12 of 2011; PP Number 23 of 2010. Amended by PP Number 24 of 2012, Amended by PP Number 01 of 2014, and its derivative rules are Minister of Energy and Mineral Resources Regulation Number 17 of 2010, Minister of Energy and Mineral Resources Number 07 of 2012 Amended by Minister of Energy and Mineral Resources Number 11 of 2012, Minister of Energy and Mineral Resources Number 01 the Year 2014, and the Minister of Energy and Mineral Resources Number 12 of 2011; PP No. 55 of 2010 with the Minister of Energy and Mineral Resources No. 02 of 2013; and also PP No. 78 of 2010 with its derivatives Permen ESDM No. 07 of 2014” [5].
With the Minerba Law enactment, the Indonesian House of Representatives, since the last period, has initiated the revision of the Minerba Law amendment, which was drafted in 2018[6]. However, this cannot be continued into a discussion because the problem inventory list (DIM) from the government has yet to be submitted to DPR 5 days before the DPR for the 2014-2019 end period term [7]. The most important substance of the Minerba Law is as follows: a) Redefining the formulation of mining areas; b) Alignment of overlapping authorities across sectors; c) Regulations regarding the increase in added value (processing and refining); d) Adjustment of licensing authority with Law No.
23 of 2014 concerning Regional Governments; e) People's mining permits and special arrangements regarding rock concession permits; f) The size of the mining permit area (WIUP); g) Term of IUP/IUPK; h) The role and existence of mining SOEs; and i) KK/PKP2B status after the end of the contract and the change to IUPK.
On the other hand, the Employment Creation Act, known as the Omnibus Law, has now been enacted, “which includes the regulation of mining business activities, especially those related to licensing clusters and several other arrangements which are also regulatory material in the Minerba Law. The Omnibus Law is a program to simplify, trim and harmonize the arrangement of more than one cluster in one law. Omnibus Law is a statutory regulation that contains more than one (cluster) regulatory content” [9]. In other words, in one law, there are many arrangements with the same type or theme but in different clusters or fields, which aims to create an independent regulator that can negate other regulations.
The problem is that the content of the Omnibus Law of the Job Creation Law is considered different than expected. Several provisions in the Job Creation Act have also been regulated in the Minerba Law, so there is overlapping regulatory material between the two laws. It is because some of the
material for the Minerba Law is currently also part of the Omnibus Law on Job Creation [8]. “The Omnibus Law for mining clusters consists of provisions governing Law No. 4 of 2009 concerning Mineral and Coal Mining (Minerba Law), Law No. 22 of 2001 concerning Oil and Gas (Oil and Gas Law), and law No. Law Number 21 of 2014 concerning Geothermal (Geothermal Law), and Law Number 30 of 2009 concerning Electricity (Electricity Law). The mining cluster Omnibus Law contains the authority to control minerals and coal by the state, which is held by the Central Government (Licensing authority in the Central Government) and can be delegated to local governments. The division of authority for mineral processing and refining between the Ministry of Energy and Mineral Resources and the Ministry of Industry. It is that mining to processing activities require an IUP, refining activities require an industrial business permit (IUI), and redefinition of the words "processing" and "refining" in the Mineral Law and Coal. In addition, there are incentives for downstream coal in the form of gasification in the form of not being subject to Domestic Market Obligation (DMO) obligations, the imposition of 0% coal royalties, and the term of the permit for the life of the mine. The incentive for mineral downstream is a permit period extension for the mine life”
[9].
The considerations in “Law Number 3 of 2020 concerning Amendments to Law Number 4 of 2009 concerning Mining and Coal Mining are: a) Minerals and coal located within the Republic of Indonesia Unitary State territory are non-renewable natural resources and wealth as a gift from God Almighty; b) Mineral and coal mining business activities have an essential role in providing real added value for national economic growth and sustainable regional development; c) Regulations regarding mineral and coal mining which are currently regulated in Law Number 4 of 2009 concerning Mineral and Coal Mining, still need to be revised to answer developments, problems, and legal needs in the operation of mineral and coal mining; and d) Based on the considerations as referred to in letters a, b, and c, it is necessary to enact a Law concerning Amendments to Law Number 4 the Year 2009 concerning Mineral and Coal Mining”[10].
“Indonesia is ranked first in the world for the number of nickel resources. Indonesia is said to have nickel resources of 23.7% of the world's total nickel resources, followed by Australia at 21.5%, then Brazil at 12.4%, Russia at 8.6%, and others”[10]. Nickel is a mining commodity that requires a smelter to process clay soil containing nickel ore. It impacts the use of human resources that is more and lasts longer than other types of mining commodities. The government prohibits the export of nickel in raw materials and invites investors from various countries to invest in downstream nickel, stainless steel, and batteries. 11 smelters have been built, and another 25 are under construction. The total investment is targeted at 8-9 billion US dollars. And so far, 6.1 billion US dollars, or the equivalent of Ninety- one trillion rupiah [11].
Apart from this, the overall mining regulations are contained in the Minerba Law. However, each type of mining industry, including nickel, has different rules from others due to different conditions.
So it will be easier if this study looks at one mining industry type, nickel. As one example, the government continues to make regulations regarding the ban on the nickel products export and downstream, which are considered detrimental to the interests of some parties, such as businessmen.
Furthermore, “as stipulated in Government Regulation 1 of 2017, exports have been reopened for 5 (five) years, but still, they need to be five years. In 2020, these exports were stopped based on Minister of Energy and Mineral Resources Regulation Number 11 of 2019”[10]. Even though exports should have stopped on the 12th of January 2022, this thesis research wants to look at changes in regulations in the mining industry, in particular from the perspective of legal typology and sociological jurisprudence and legal typology, to increase the breadth of ways of thinking. It is then researched with the title "Juridical and Historical Review of Law Mineral and Coal Management (Nickel) in Indonesia."
From the background above, the problem is formulated as follows: a) “How are changes in regulations in the nickel mining industry related to the legal typology of Nonet and Selznick? b) How to understand changes to the Minerba Law from the perspective of sociological jurisprudence from Roscoe Pounds? The research aims are: a) to understand and explain changes in regulations in the nickel mining industry related to the legal typology of Nonet and Selznick; and b) to know, understand and explain changes to the Minerba Law from the perspective of sociological jurisprudence from Roscoe Pound”.
Antonius Setyadi (The Analysis of Minerba (Nickel) Governance Law in Indonesia: A Juridical and II. Methods
The method used in this research is the juridical-normative legal research method. “This juridical- normative approach is based on the primary legal material by examining the theories, concepts, legal principles, and laws and regulations related to this research. This type is conceptualized as what is written in legislation or law, conceptualized as a rule or norm, a standard of human behavior considered appropriate”. This thesis was carried out through a statutory regulatory approach supported by “primary and secondary legal materials with a statutory approach (statute approach), analytical approach (analytical approach), and historical (historical approach). A statute approach examines all laws and regulations related to the legal issues being handled. In this thesis research, the statutory approach used will help to study the existence of consistency and conformity between laws and constitutions or between regulations and laws”[12]. Guided by the research problems put forward, the research uses a statutory approach, namely the legal norms contained in the Minerba legislation. The legal norms contained in mineral and coal mining consist of several regulations, namely Laws, Government Regulations, and Ministerial Regulations, which relate to research issues. The research instrument used for secondary data was interviews and data analysis carried out in a descriptive analysis manner. The analytical approach is carried out by looking for the meaning of legal terms contained in legislation so that an understanding of the meaning contained in the law under review can be obtained and its practical application is understood by analyzing legal decisions. The historical approach (historical approach) is research conducted by examining the background of what was learned and developed regarding the issues at hand. This historical approach is carried out to look for legal rules from time to time to understand the philosophy of these legal rules and study the development of these legal rules. "..finding out the previous law to understand the reasons behind the existing law and the course of evolution" [13]. Data analysis in this study is qualitative. The data obtained, collected in the manner described above, and arranged systematically to then be analyzed qualitatively, which finally wrote down what should be done, namely primary data analysis, strengthened by normative analysis (legislation or doctrinal). Data collection was carried out by employing a literature study, the single method used in normative legal research. “Through a literature study, legal material was then collected. The collection of legal materials consists of primary, secondary, and tertiary legal materials, which are classified according to the legal issues to be discussed”[14]. The legal material is then managed to obtain an explanation through the management of legal material, which is deductive, namely drawing conclusions that describe problems in general to specific or more concrete problems. After getting concrete problems, the writer analyzes them using scientific reasoning to answer the legal issues formulated in the problem formulation.
III. Result and Discussion
A. Purpose and Purpose of Change of Rules
Nonet and Selznick provide ideas about the types of law that occur in society: the type of repressive law, the type of autonomous law, and the type of responsive law. Regarding repressive law, if seen from its history, it is considered unable to overcome legal problems in society, mainly because this type of repressive law prioritizes politics as a tool to legitimize interests. The resulting legal products still look raw or forced by political institutions. It makes the ruling party look more authoritarian in exercising power without paying attention to accountability. In the understanding of autonomous law, this law has given strong legitimacy to law enforcement agencies to carry out the law based on the available rules with a predetermined procedural format. While the responsive law that we discussed above, in its development, greatly influenced the growth and development of modern legal theory.
Jerome Frank stated “that the primary goal of lawmakers is to make the law more responsive (responsive) to social needs. They, therefore, urge that relevant areas to be covered by law be developed so that the legal mindset can include knowledge of the social context and the impact of government policies or actions” [10]. In this perspective, good law must offer more than existing procedural justice. The law must be fair and provide equal opportunities; the law should help determine the interests of the community and adhere to the achievement of substantial justice. The legal system must open itself to input, which shows a link involving participation and understanding, and accept new socio-economic needs.
It is part of the sociology of law. Antasari stated that the three legal typologies are the three dilemmas that exist between integrity and openness. He synthesizes that: “a) Repressive law is characterized by the passive and opportunistic adaptation of legal institutions to the social and political
environment; b) Autonomous law is a reaction against arbitrary openness. His main concern is how to maintain institutional integrity. The law isolates itself, narrows its responsibilities, and accepts blind formalism to achieve integrity; and c) The responsive legal type seeks to overcome such tensions. The hallmark of responsive law is looking for the implied values of regulations and policies” [15].
In a responsive legal order, due process is understood as a series of regulations described that protect the right to notification (right of the notice) to be heard in trials with a jury system. This meaning of due process differs from a more flexible interpretation, which assumes that the rules relating to specific contextual problems seek to identify the values at stake in protection through procedures. Efforts to articulate these values produce an authoritative criterion to criticize existing regulations, encourage the formation of new ones, and demand the expansion of the due process system to new institutional situations. So then, the need for an order of values more directed to forming responsive law is felt. The reason is that regulations must depend on or be adapted to appropriate historical conditions to be relevant and vital. As the environment changes, regulations must be readjusted to meet policy requirements and protect the regulatory authority and its integrity when applied.
B. Practice Implementation of the Rules
In developing this legal typology within a country, “the transition period from autonomous to responsive can be seen from the ability to generalize legal objectives. Specific policy rules and procedures are considered instruments and can be adjusted. In this case, the factor that is easy to see is whose interests will be fulfilled by the existence of legal adjustments. Therefore, what characterizes responsive law is the search for implicit values that exist in rules and policies. In this case, the Minerba Law that we discuss will be reviewed from the value of utilitarianism described in the previous chapter. Nonet and Selznick here emphasize Jerome Frank's thought that the primary goal of legal realists is to make the law more responsive or responsive to social needs. Therefore, the relevant areas to be covered by law should be broadened so that the legal mindset can include knowledge about the social context and the impact of government policies or actions” [10].
Responsive does not just mean open or adaptive, but rather shows that the law must have the ability to be responsible. It means that a responsive institution will maintain a view of what is essential for its integrity while at the same time thinking about the new needs that exist in its environment.
According to Nonet and Selznick, there are three laws: repressive, autonomous, and responsive law [16].
The discussion about repressive laws has been clear above. As a country that was born and just developed, sometimes it has to use this type of law because of the many limited resources, for example.
Then was born the type of autonomous law. Autonomous law is a reaction to absolute and equal openness. The emphasis is on maintaining institutional integrity to achieve goals. This law isolates itself, narrows its responsibilities, and accepts blind formalism as the price for achieving the integrity of law enforcement.
Meanwhile, the third type of law, the responsive type, tries to overcome this problem.
Responsiveness, referred to by Nonet and Selznick here, does not mean simply being open or adaptive but rather shows that the law must have the capacity to be responsible. Therefore, the adaptation is specialized and selective. A responsive institution will maintain a view of what is essential to its integrity while considering the new needs in its environment.
The principle of legality is the most basic legal principle adopted by democratic countries. It emerged as a reaction against the authoritarian tendencies in 15th-century Western Europe. At that time, the authorities, together with the Church members of the Standestaat, exercised totalitarian power so that people's human rights tended to be neglected and even trampled on. The standestaat is an organizational system that is territorial and includes groups of nobles, clergy, and ordinary citizens (stand) in the same status as the ruler. Then there is a process in which the ruler's power becomes more dominant compared to the standard, followed by a relationship that no longer occurs in the Standestaat but becomes a relationship between countries [17].
Antonius Setyadi (The Analysis of Minerba (Nickel) Governance Law in Indonesia: A Juridical and C. Strengths and Weaknesses of Regulatory Change
The thought of Nonet and Selznick regarding the administration of law in developing countries was that “when a nation still has to face fundamental problems (such as building a nation or a new political order), it is understandable that there are limited resources on the part of the ruling elite” [18].
As a result, the leaders choose to use power. The outline of thought regarding the legal order introduced by Nonet & Selznick in their writing Law & Society in Transition: Toward Responsive Law is the theory of modernization. This theory says that “developing countries will reach a level of legal development enjoyed by advanced or modern countries if they are willing to follow the path taken by these developed countries” [19]. However, as time passed, this modernization theory became invalid, so his thoughts began to be abandoned. So, developing from this, Nonet and Selznick developed a development model, which started from the awareness that the understanding of law and society is quite complex.
In the relationship between the ideal of autonomous and responsive law, as proposed by Nonet and Selznick, there is a continuity of legal rules connected to each type. The emphasis “early on is the notion of legality as the progressive reduction of arbitrariness does not disappear in responsive law. It takes a different form, as Nonet and Selznick mention, namely by insisting on the maximally feasible reduction of arbitrariness by demanding a legal system that can reach beyond formal regularity and procedural justice to substantive justice. Using the exact definition of legality as in their previous work, Nonet and Selznick emphasize that legality remains the primary ideal of law. Furthermore, because legality in previous works is considered identical to the ideals of a rule of law state, the ideal substance of the rule of law is also present in responsive law—the meaning of the ideal rule of law changes here. Autonomous law demands harmful restrictions on authority. Responsive law demands justice” [12].
As stated in the amendment to the Minerba Law Number 3 of 2020, the advantages include four main substance changes: improving national mining governance, alignment with national interests, legal certainty and ease of investing, and environmental management. This change is a good thing that shows the government is increasingly responsive because there are objectives to be achieved, namely to increase the enthusiasm for mineral and coal exploration and to ensure that Indonesia has sovereignty in the mineral and coal sector. The management of minerals and coal, from investment and licensing to production and sales, is carried out in ways oriented toward national interests. Not only that, but the new Minerba Law also provides legal certainty and ease of investment for holders of Mining Business Permits (IUP) and Special Mining Business Permits (IUPK).
The weakness of this change can be seen from the refinement process, which is relatively slow in accommodating all interests. In the process of amending these laws and regulations, to a certain extent, there are efforts that, at the time the changes occurred, parties were disadvantaged because they had followed the previous regulations. So this stage can bring losses to some parties before finally all parties can feel the benefits.
Minerals and coal are one of the natural resources contained in the earth and are included in the category of non-renewable natural resources. It is in line with the provisions of “Article 33, paragraph (3) of the 1945 Constitution. The expression controlled by the state and used for the greatest prosperity of the people means that the state, through the central government, is responsible for the use of Minerals and Coal in the Indonesian jurisdiction”. It should be implemented through proper management and utilization of Minerals and Coal to encourage and support the development and independence of national industrial development based on Mineral resources and Coal energy.
D. Legislative Analysis based on Nonet and Selznick
Amendments to “the Mining Law made from Law Number 4 of 2009 to Law Number 3 of 2020 concerning Amendments to Law Number 4 of 2009 concerning Mineral and Coal Mining contain many change points. The changes listed in this chapter are only partial changes to show how these changes can be understood from the perspective of Nonet and Selznick's legal typology. Nonet and Selznick, in this typology, focus on the process that occurs when a nation still has to face fundamental problems (such as building a nation or a new political order). If we understand from the perspective of Nonet and Selznick's legal typology, the changes that occur in the Mining Law in Indonesia can illustrate what is meant by legal typology. The changes that occurred in Law No. 4 of 2009 to Law No. 3 of 2020, through the formation of laws stages, are in line with the thoughts of the Indonesian government, which show responsiveness in the formation of laws. Law Number 3 of 2020 is the latest
Minerba Law, which has undergone a long process, especially when viewed from the history of the Minerba Law in Indonesia. The refinement of the previous Mining Law, namely Law Number 4 of 2009, through the improvement of the Draft Law, which was carried out through an intensive discussion of the Inventory List of Minerba Bill Issues with the government from mid-February to early May 2020 [10].
The 15 new formulations and improvements in the Minerba Law are as follows:
a. Concerning the control of mineral and coal minerals, it has been agreed that the Central Government controls minerals and coal through policy, regulation, administration, management, and supervision. It is regulated in Law number 3 of 2020 Article 4 number (2), which reads, "The State Control of Mineral and Coal as referred to in paragraph (1) is carried out by the Central Government following the provisions of this law. Previously in Article 4 paragraph (2) of Law Number 4 of 2009, the government and local governments held control. Therefore, the Central Government has the authority or authority to determine the quantity of production, sales, and prices of metallic minerals, certain types of non-metallic minerals, and coal. It is regulated in Article 5, paragraphs (2) and (3), and Article 6 of Law Number 3 of 2020. Previously in Law Number 4 of 2009, there was no regulation. Therefore, regulations regarding Regional Government are abolished as stated in Law Number 4 of 2009 Article 5 points (4) and (5).
b. It is agreed that the Mining Area as part of the Mining Legal Area is the basis for determining Mining Business Activities. It can be seen in Law Number 3 of 2020 Article 1 (28a) and number (29). It is stated in Article 1 (28a) of Law Number 3 of 2020 that "Mining Legal Areas are all land space, sea space, including space within the earth as one territorial unit, namely the Indonesian archipelago, land under waters, and the continental shelf."
c. There is a guarantee from the central government and regional governments not to make changes to the use of space and areas of the Mining Business Areas (WIUP), People's Mining Areas (WPR), and Special Mining Business Permit Areas (WIUPK). It has been determined as well as guaranteed the issuance of other permits that have been issued. It is necessary for the implementation of mining business activities. It is contained in Law Number 3 of 2020: Article 17A number (2) for WIUP; Article 22A for WPR; Article 31A number (2) for WIUPK.
d. Concerning WPR, previously, it was given a maximum area of 25 hectares and a maximum depth of 25 meters. As regulated in Law Number 4 of 2009, Article 22 points (b) and (d), but in Law Number 3 of 2020, Article 22 points (b) and (d) is changed to a maximum area of 100 hectares and has metal mineral reserves with a maximum depth of 100 meters.
e. The mining business is carried out based on business licenses from the central government.
f. Regarding the regional government's share of the results of mining activities, if previously the provincial government only received 1 percent of the share, this change is increased to 1.5 percent in the Draft Law. It is regulated in Article `129. Previously, in Law Number 4 of 2009, it was stipulated that the Provisional Regional Government received a 1% share, the producing regency/city Regional Government received 2.5%, and another regency/city Regional Government in the same provision received 2.5%. Law Number 3 of 2020 stipulates that the Provisional Regional Government gets a share of 1.5%, the producing Regency/City Regional Government gets 2.5%, and other Regency/City Regional Governments in the same provision get 2%,
g. There is an obligation for the minister, as regulated in Law Number 3 of 2020 Article 87A, to provide mining data and information.
h. The mining road can be built alone or in collaboration. It is regulated in Article 91. The previous regulation in Law Number 4 of 2009 Article 91 stipulates that "IUP and IUPK holders can utilize public infrastructure and facilities for mining purposes after complying with statutory regulations." However, Law Number 3 of 2020 Article 91 is regulated in more detail regarding mining roads.
i. The minimum amount determined by the minister is the obligation for IUP and IUPK holders to allocate funds to carry out community development and empowerment programs. Previously in Article 1 paragraph (28), it was given the understanding that Community Empowerment is an effort to improve the ability of the community, both individually and collectively, to have a better
Antonius Setyadi (The Analysis of Minerba (Nickel) Governance Law in Indonesia: A Juridical and standard of living. Then in Articles 140 and 141, paragraph (1) point (j), it is regulated that the minister shall supervise the implementation of mining business activities, including community development and empowerment programs. Previously, in Law Number 4 of 2009, the term was
"development of a mining technical workforce."
j. Production Operation IUP and Production Operation IUPK
k. holders should provide mineral and coal reserve resilience funds that are used to discover new reserves. It is regulated in Law Number 3 of 2020, article 112A. This Reserve Resilience Fund, in terms of the mineral economy, is depletion, which is a method for reducing tax payments along with amortization and depreciation, which will be deducted from Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA). In theory, the size of this reserve resilience fund is around 3-5% of the company's net profit, which is kept in the company's accounts. However, in mining accounting, the amount has yet to be determined.
l. Regarding reclamation and post-mining activities, the holder of a Production Operation IUP or Production Operation IUPK must carry out reclamation and post-mining activities until a 100 percent success rate is reached before returning the WIUP or WlUPK they hold. IUP or IUPK holders that have expired must carry out reclamation and post-mining until achieving a 100 percent success rate and placing a post-mining guarantee fund.
m. In the amendment to the Minerba Law, the responsibility for managing the budget, infrastructure, and the mine operation inspector in carrying out supervision is borne by the minister. It is regulated in Law Number 3 of 2020 Article 6 number (1) point (v), Article 141 number (2), (3), which has supervisory duties as stipulated in Article 141 paragraph (1) letter a, letter e, letter f, letter g, and letter k.
n. Regulations regarding “criminal provisions for mining activities without a permit which were previously subject to a maximum imprisonment of 10 years and a maximum fine of IDR 10 billion, were changed to a maximum imprisonment of 5 years and a maximum fine of IDR 100 billion. It is also the case with holders of IUP, IUPK, IPR, or SIPB who intentionally submit reports incorrectly or false statements and any person who has an Exploration IUP or Exploration IUPK but carries out production operations. Everyone who accommodates, utilizes, processes, and refining develops and uses, transports, and sells minerals and coal that do not come from holders of IUP, IUPK, IPR, SIPB, or other permits, is also punished. The punishment was imprisonment for five years and a maximum fine of IDR 100 billion. Criminal provisions were not previously regulated in the previous law, namely any IUP, IUPK, IPR, or SIPB holder. Those who transfer IUP, IUPK, IPR, or SIPB without the minister's approval will be subject to a maximum penalty of 2 years in prison and a maximum fine of IDR 5 billion. Those whose IUP or IUPK is revoked or expires and do not carry out reclamation and post-mining and placement of reclamation guarantee funds and post-mining guarantees shall be subject to a maximum sentence of 5 years and a maximum fine of IDR 10 billion. In addition, ex-IUP or IUPK holders may be subject to additional punishment in the form of payment of funds in implementing reclamation and post-mining, which is their obligation”[10].
o. When the revision of the Minerba Law comes into effect, then:
1). IUP, IUPK, IPR, Production Operation IUP specifically for transportation and sales and IUJP that existed prior to the enactment of this law are declared to remain valid until the expiry of the permit.
2). IUP, IUPK, IPR, Production Operation IUP specifically for transportation and sales, and IUJP that existed prior to the enactment of this law must comply with provisions related to Business Licensing following the provisions of this law within two years of the enactment of the law
3). Governors must submit documents for Exploration Mining Permits, Production Operation Mining Permits, IPR, and Special Production Operations Mining Permits for transportation and sales. IUJP issued prior to enacting this law to the minister within a period of no later than two years from the enactment of this law to be renewed by the minister.
4). The provisions contained in the IUP, IUPK, and IPR must be adjusted to the provisions of this law within a period of no later than one year since this law came into force.
5). Special Production Operation Mining Permits for processing and refining issued prior to the enactment of this law shall be adjusted to become industrial business permits issued based on laws and regulations in the industrial sector within a period of no later than one year from the enactment of this law.
A condition vulnerable to change, for example, science and technology that continues to develop, allows law violations to become increasingly complex. Political conditions become very decisive, especially concerning the administration of justice and order for the people. The repressive legal order shows authoritarian power. Implementing stringent laws in society requires relatively large conditions, such as coercion, turning off creativity and mindset, and other detrimental costs to the law and society so that the community must bear the losses. The model considered quite ideal is the type of law that is autonomous because this type of law provides the possibility to realize a stable and durable institutional order. Autonomous law is a form of law responding to the type of repressive law considered too authoritarian. This autonomous type is intended to soften repression and protect integrity.
Meanwhile, compared to the responsive type of law, weaknesses are found in it. This type of responsive law is considered less strong and vulnerable because the supporting nets to realize this law are considered fragile. At this stage, the consolidation and defense of institutional autonomy focused on the role of legal officials. This term refers to the weakness and strengths of the rule of law.
Concerning the above, the state based on law is an abstract normative concept. In reality, it is filled by the state of the level of social, political, and economic development of the nation concerned. The Rule of Law described by Nonet and Selznick should be understood as a particular institutional system, not as a mere abstract idea or ideal. The main characteristic of this system is the formation of specialized legal institutions, which are relatively autonomous and have advantages and particular areas of competence. Nonet Selznick's description and categorization of repressive, autonomous, and responsive law types help us understand the rule of law well. This understanding to realize the goals of community law can be applied to various problems that are being faced in its aim to provide justice for all Indonesian people based on Pancasila and the 1945 Constitution of the Republic of Indonesia.
E. Minerba Law from the Perspective of Sociological Jurisprudence
This section will examine the development of the Minerba Law from the perspective of the sociological jurisprudence school by Roscoe Pound. As described in chapter II, Roscoe Pound's idea of sociological jurisprudence focuses more on legal reality than on the position and function of law in society. It shows a careful compromise between written law as the legal community's need for the creation of legal certainty (positivism law) and living law as a form of appreciation for society's critical role in law formation and legal orientation.
One of the mandatory things in the Indonesian legal state is the wetmatigheid van bestuur, or the principle of legality. This principle states that all government actions must be based on valid and written laws and regulations. The written legislation must exist and be enforced first or be a prelude to administrative actions or actions taken. So it can be said that every administrative action must be based on rules or rules and procedures [20].
The basis of this regulation in Indonesia is “the 1945 Constitution Article 33 paragraph (3) which states that "Earth and water and the natural resources contained therein are controlled by the State and used for the greatest prosperity of the people." Indonesia is fully sovereign over the wealth of its natural resources, and this natural wealth must be used for the greatest prosperity of the people, which is interpreted as legal ownership rights to natural wealth for the Indonesian people. It means that the right of state control is an instrument, and 'the greatest prosperity of the people is the ultimate goal of natural wealth management”[21]. It was later reaffirmed in Law Number 11 of 1967 concerning Basic Mining Provisions that: All minerals contained in the mining jurisdiction of Indonesia, which are natural deposits as a gift from God Almighty, are the National Assets of the Indonesian Nation, controlled and used by the state for the greatest prosperity of the people.
The meaning of being controlled by the state is “that the natural wealth that exists in the territory of Indonesia is the government's authority to determine the use, utilization, and rights of natural resources. It was within the scope of regulating, administering, managing, and supervising the management and utilization of natural resources”. So rich is Indonesia's nature, including the content in the soil, so that “not all of it can be exploited by the state. It is essential that all parties understand
Antonius Setyadi (The Analysis of Minerba (Nickel) Governance Law in Indonesia: A Juridical and that the concession rights can be delegated to private legal entities or individuals within the jurisdiction of Indonesian mining with a mining authorization, Contract of Work, or Cooperation Agreement”.
However, the State of Indonesia is positioned as the holder of sovereign power over it. It does not necessarily make the private sector the owner of the mined materials being cultivated. Therefore, transferring this ownership right is the implementation right of mining exploitation to the mining authority holder. The Mining Authority or mining authority does not have the right to own mining materials but rather a permit to carry out a mining business. The Contract of Work is not a mechanism for transferring state rights but only a means or instrument that allows private parties to participate in the mining business. “This understanding forms the basis that private parties cannot have monopoly rights in controlling, exploiting, and distributing mining business products because this is contrary to the state constitution and can hinder the objectives of the 1945 Constitution Article 33 paragraph 3 concerning the greatest extent, people's prosperity. The state's position, in this case, is as the mining materials owner, and the opposite of the contract is the executor of the exploitation of the mining materials (contractor)” [10].
Law Number 11 of 1967 stipulates that it is possible for a legal entity or individual with a mining authority who succeeded in exploiting minerals to own the minerals he is working on. It is possible if the mining authority or contract work holders fulfill their obligations to the state, namely payment of fixed fees and exploration fees (for exploration mining authority holders) and exploitation fees (for exploitation mining authority holders). Law Number 11 of 1967 became the law that regulates mining after the State of Indonesia became independent and sovereign in 1945. The government controls and manages Indonesia's natural resources, and the class and type of minerals determine the implementation of control and regulation.
F. Implementation Practice
The government's authority in Law Number 11 of 1967 is a) Strategic class minerals and minerals by the government. Minerals that are not classified as strategic and vital minerals by the Regional Government. However, in Articles 6-8 of Law Number 40 of 2009, this arrangement is more detailed, as can be seen as follows: The Central Government's authorities are: “1) determination of national policies; 2) making laws and regulations; 3) determination of national standards, guidelines, and criteria; 4) establishment of a national mineral and coal mining permit system; 5) determination of WP which is carried out after coordinating with the regional government and consulting with the House of Representatives of the Republic of Indonesia; 6) granting of IUP, fostering, resolving community conflicts, and supervising mining businesses located across provincial areas and/or sea areas more than 12 (twelve) miles from the coastline; 7) granting of IUP, fostering, resolving community conflicts, and supervising mining businesses whose mining locations are in cross- provincial areas and/or sea areas more than 12 (twelve) miles from the coastline; 8) granting IUP, fostering, resolving community conflicts, and supervising mining business production operations that directly impact the environment across provinces and/or in a sea area more than 12 (twelve) miles from the coastline; 9) granting of Exploration IUPK and Production Operation IUPK; 10) evaluation of Production Operation Mining Permits issued by local governments, which have caused environmental damage and which do not apply good mining principles; 11) stipulation of policies on production, marketing, utilization, and conservation; 12) establishing policies for cooperation, partnership, and community empowerment; 13) formulation and determination of non-tax state revenues from mineral and coal mining business results; 14) fostering and supervising the management of mineral and coal mining carried out by local governments; 15) fostering and supervising the preparation of regional regulations in the mining sector; 16) inventory, investigation, and research and exploration in order to obtain data and information on minerals and coal as materials for the preparation of WUP and WPN; 17) management of geological information, information on potential mineral and coal resources, as well as preparation of WUP and WPN; 18) management of geological information, information on potential mineral and coal resources, as well as mining information at the national level; 19) fostering and supervising post-mining land reclamation; 20) preparation of national level mineral and coal resources balance sheet; 21) developing and increasing the added value of mining business activities; and increasing the capacity of Government apparatus, provincial governments, and district/city governments in managing mining business” [10].
The authority of the Provincial Government: “1) making regional laws and regulations; 2) granting IUP, fostering, resolving community conflicts and supervising mining businesses across regencies/municipalities and/or sea areas from 4 (four) miles to 12 (twelve) miles; 3) granting of IUP,
fostering, resolving community conflicts and supervising mining business production operations whose activities are located across regencies/municipalities and/or sea areas from 4 (four) miles to 12 (twelve) miles; 4) granting IUP, fostering, resolving community conflicts and supervising mining businesses that directly impact the environment across districts/cities and/or sea areas from 4 (four) miles to 12 (twelve) miles; 5) inventory, investigation and research as well as exploration in order to obtain data and information on minerals and coalcoal in accordance with their authority; 6) management of geological information, information on potential mineral and coal resources, as well as information on mining in the province/region; 7) preparation of balance sheet of mineral and coal resources in the province/region; 8) developing and increasing the added value of mining business activities in the province; 9) development and enhancement of community participation in mining businesses with due observance of environmental sustainability; 10) coordinating licensing and supervising the use of explosives in mining areas in accordance with their respective authorities; 11) delivery of information on the results of inventories, general investigations, and research and exploration to the minister and regents/mayors; 12) delivery of information on production results, domestic sales, and exports to the minister and regents/mayors; 13) fostering and supervising post- mining land reclamation; and 14) increasing the capacity of provincial government officials and district/city governments in managing mining business” .
The responsibilities of the Regency/City Government are: “1) making regional laws and regulations; 2) granting of IUP and IPR, coaching, resolution of community conflicts, and supervision of mining business in regency/municipal areas and/or sea areas up to 4 (four) miles; 3) granting of IUP and IPR, guidance, resolution of community conflicts and supervision of production operation mining businesses whose activities are located in the regency/city and/or sea area up to 4 (four) miles;
4) inventory, investigation and research, as well as exploration in order to obtain mineral and coal data and information; 5) management of geological information, information on mineral and coal potential, as well as mining information in regency/city areas; 6) compilation of mineral and coal resource balances in regency/municipal areas; 7) development and empowerment of local communities in the mining business by taking into account environmental sustainability; 8) developing and increasing the added value and benefits of mining business activities optimally; 9) delivery of information on the results of inventories, general investigations, and research, as well as exploration and exploitation to the minister and governors; 10) submission of information on production results, domestic sales, and exports to the minister and governors; 11) guidance and supervision of post-mining land reclamation;
and 12) increasing the capacity of regency/municipality government apparatus in the implementation of mining business management”.
Pound also states that “law is an experience regulated and developed by reason, promulgated with authority by the bodies that make laws or pass laws in a politically organized society and assisted by that society's power. The emphasis here is on the agency's ability to make and or ratify the law itself, including, in this case, the Minerba Law. Bearing in mind the existing experience, especially if it is related to the legal typology of Nonet and Selznick in the previous chapter, the Indonesian people adjust their laws as Indonesia shifts from a colonial economic system to a national economic system.
In the mining sector, previously repressive laws, which served the interests of the Dutch East Indies government, needed to undergo a process to become a law responsive to the welfare of the people.
Pound, in this case, emphasizes the need to pay attention to interests in his Theory of Interest. He stated that social interest is a more transparent attempt to create a responsive legal model. The interests in question are, of course, the interests of the Indonesian people. So this amendment to the Minerba Law after the independence era, namely Law Number 1 of 1967, Law Number 4 of 2009, and finally, Law Number 3 of 2020, must be based on experience regulated and developed by reason. This nation wants to be careful in utilizing its resources, especially since it is non-renewable energy, to be used detrimentally, and does not support the prosperity of the people. The government needs to be careful that the regulated laws do not serve only a few parties or even other nations because this is not following the 1945 Constitution Article 33 paragraph (3). Thus, legal experts and judges must be more flexible and open in understanding the law and accommodate changes that occur in society so that the law can be a link that creates harmonization in meeting the interests and aspirations of the community and minimizes social conflicts. If viewed from the perspective of Pound's sociological jurisprudence, it can be understood how the function of this law is dynamic in society, and there are social values that are expressed in the law itself. The judicial task of judges is no longer understood simply as applying the law to factual events learned from various cases and conflicts but also as a social driver or social engineering. A society that needs to be mobilized and formed in this regard in connection
Antonius Setyadi (The Analysis of Minerba (Nickel) Governance Law in Indonesia: A Juridical and with the habits that occur in the Nickel mining industry in order to form a system and culture that supports the interests of Indonesian sovereignty, especially in this case, following the 1945 Constitution Article 33 paragraph (3), where the state processes Indonesia's natural wealth with the prosperity of the people being the primary goal”[10].
Regulating mining in Indonesia is “one of the crucial things to do. It is because mining is a vital production branch for the country. The arrangements made in the recent Minerba Law Number 3 of 2020 are arrangements for sustainable and responsible mining management that must provide added value for the prosperity of the people, thoroughly carried out by the government and the DPR. It means that the government and the DPR are continuously making adjustments to improve the mining sector so that it makes a real contribution to society. This arrangement includes benefits, environmental insight, legal certainty, participation, and accountability. A significant implication of the regulations made regarding mining, especially in the Nickel mining industry, is the prohibition on the export of raw nickel ore, which has been banned since 2020, with the aim that the raw material is further processed to provide added value. The basis for this is the Minister of Energy and Mineral Resources Regulation (Permen) Number 11 of 2019 concerning the Second Amendment to the Regulation of the Minister of Energy and Mineral Resources Number 25 of 2018 concerning Mineral and Coal Mining Exploitation. In this case, the ban on exporting raw nickel or nickel ore will take effect as of the 1st of January 2020, although the government then relaxed it. However, the Ministry of Energy and Mineral Resources later accelerated the export ban on nickel ore commodities, starting on the 1st of January 2020, 2 (two) years earlier than the original plan. This export ban applies to nickel ore with grades below 1.7%—several reasons for the government to accelerate the ban”. Low-grade nickel ore can already be processed domestically due to advanced technological developments.
Seeing this problem from Pound's perspective regarding the Theory of Interest, there are various parties involved in the nickel industry, including nickel entrepreneurs, who, in this case, feel disadvantaged to a certain extent due to the ban on the export of raw materials (nickel ore), which they usually do. , automatically 'mess up the production and sales process. It affects their cash flow. Then another party that is affected and feels a loss from this export ban is the European Union. This policy of limiting imports of nickel ore is considered unfair. It hurts the European steel industry due to limited access to nickel ore and other mineral ores such as iron and chromium. The European Union has urged the World Trade Organization (WTO) to form a panel to discuss the dispute. Then many parties have an interest in the running of the nickel industry, including the export ban, namely contractor companies that play a role in mining activities.
Despite the “interests involved in banning nickel ore exports, the government is paying attention correctly. It is understood from the perspective of the greater welfare, namely the nation and people of Indonesia. It follows Article 33, paragraph 3 of the 1945 Constitution, as the highest foundation used by miners. The export ban will likely slightly reduce Indonesia's export potential in the short term. However, in the long term, the export ban will positively impact the economy as a whole.
Because the export ban will increase investment in building smelters and downstream industries, most of which will be exported later”[10].
It is following Law Number 25 of 2007 concerning Investment. Particularly for foreign investment, Article 1 Number 3 of Law Number 25 of 2007 states that: Foreign investment is an investment activity to conduct business in the territory of the Republic of Indonesia, which is carried out by foreign investors, both those who use entirely foreign capital and those in joint ventures with domestic investors.
The objectives, as stated in Article 3 Point 2 of Law Number 25 the Year 2007, are as follows: “a) to increase national economic growth; b) create job opportunities; c) promote sustainable economic development; d) improve the competitiveness of the national business world; e) increasing national technological capacity and capability; f) encourage the development of the people's economy; g) transforming the potential economy into real economic strength by using funds originating from within the country as well as from abroad, and h) improve the welfare of the community”[10].
In addition, “what needs to be considered in Pound's thinking concerning the ban on nickel exports is that the state's interest must be the highest or the highest because the state has national interests.
The national interest must protect the state interests; in this case, there is a phrase that the will of the state is the will of the public because the law is not, as positivist theories say that the law has a closed nature. Ideology, politics, economy, society, and culture strongly influence law. It is not just the
government's will”. In open logic, the development of community needs dramatically affects the growth of law in society. Politics significantly affects the growth of law in society. As suggested earlier, this type of non-renewable energy Nickel is becoming a global phenomenon. It is because of the need for nickel as an essential component in the manufacture of lithium batteries for electric cars and associated with an era where the export of mining raw materials is freed, and this does not bring prosperity to the national economy. This country issued a regulation to protect Indonesia's natural products. The results must be very beneficial for the welfare of many people.
Thus, “to understand the changes to the Minerba Law from the perspective of Roscoe Pound's sociological jurisprudence, when the enforced law produces a balance for these three interests, then this harmonious balance reflects the essence and justice. Since Indonesia became sovereign and independent in 1945, the Minerba Law in Indonesia has undergone several changes. It is intended to improve the people's welfare by transitioning from a colonial economic system to a national one. This evolution should be understood as a process that takes into account various interests in line with Pound's theory of interests, including special rules regarding the ban on exports of raw materials aimed at protecting the national economy by inviting foreign investors to manufacture smelters, with multiple benefits as stipulated in Law Number 25 of 2007 concerning investment”[10].
In its application in Indonesia, characterized by a positivistic legal flow, where decisions can be logically deduced from the previous regulations without needing to refer to social goals, wisdom, and morality, it needs to be considered. A comprehensive thought of progressive law initiated by Prof.
Satjipto Rahardjo emphasized that the purpose of law or legal ideals should contain moral values, such as justice and truth. These values must be able to be realized in objective reality. In implementing the Minerba Law, it is necessary to have the desire to continue to build oneself so that it is qualified to serve and bring the people prosperity and happiness..
IV. Conclusion
This thesis research concludes that “the earliest known Minerba Law was Indische Mijnwet 1899, which acted as a repressive law. This act worked for the benefit of Dutch (foreign) private companies to obtain mining products from Indonesia under the Dutch East Indies government. It served the authorities' interests without considering the welfare of the Indonesian people, who are the owners of the Indonesian homeland. Then at the time of Law Number 10 of 1959 concerning the cancellation of Indische Mijnwet 1899, this Cancellation Act acted as an autonomous law that played a role in supervising the previous law, which was repressive”. In this case, the law can be categorized as responsive in the Nonet and Selznick typologies. The law should be more responsive to social needs.
Therefore, the relevant fields to be covered by the law must continue to be developed so that the legal mindset can include knowledge about the social context and the impact of government policies or actions. Good law must offer something more than existing procedural justice. The law must have the ability to be fair, provide equal opportunities, help determine the interests of society and hold on to the achievement of substantial justice. In order to be responsive, the legal system must be able to open itself to input, indicating a linkage that is capable of involving participation and understanding, and accepting new socio-economic needs. Therefore, the law must be aware of and protect at least 6 (six) social interests: namely public security, social institutions (such as family, religion, and political rights), morality, social matters, economy, culture, and political progress, as well as the protection of individual life. These things need to be considered by the government, which acts as a legislator to build sociological jurisprudence. “Lawyers and judges must be more flexible and open in understanding the law and must be able to accommodate changes that occur in society so that the law can become a link that creates harmonization in fulfilling the interests and aspirations of the community and minimizing the occurrence of social clashes”. Judges' strategic role in sociological jurisprudence is to apply the law, which is not necessarily only understood as a formal social control effort in resolving conflicts but also to devise and design the application of the law as a social engineering effort. It is achieved when law enforcers pay attention to the functional aspects of the law, namely, to achieve changes by making changes to the law that will be relevant to the development of conditions. It is included in the Minerba Law, especially on the Nickel commodity, which is currently phenomenal and requires a particular focus on making a regulation that will support the people's welfare following the 1945 Constitution Article 33 paragraph (3)..
Antonius Setyadi (The Analysis of Minerba (Nickel) Governance Law in Indonesia: A Juridical and References
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