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On August 21, 2018, the Minister of Environment and Forestry issued Regulation of the Minister of Environment and Forestry of the Republic of Indonesia Number. P.27 / MENLHK / SETJEN / KUM.1 / 7/2018 Year 2018 concerning  Guidelines on Borrow to Use Forest Areas  (“ MR 27/2018 “). This rule is one of the regulations issued as the implementation of One Single Submission (“ OSS “). MR 27/2018 revokes and replaces Ministrerial Regulation No. P.50 / MENLHK / SETJEN / KUM.1 / 6/2016 (“ MR 50/2016 “) which also regulates Borrow to Use Permit of Forest Areas (“ IPPKH ”). MR 27/2018 explains: (1) the IPPKH function; (2) procedures and requirements for issuing IPPKH; (3) commitment fulfillment procedure; (4) implementation, renewal, alteration and return of IPPKH; (5) IPPKH supervision; and (6) revocation of IPPKH. In this article, we will discuss procedures, issuance requirements, commitment fulfillment procedure for IPPKH application through OSS System.

IPPKH  is a permit granted to use forest area for development purposes other than forestry activities without changing the function and designation of forest area. The procedures and requirements for IPPKH issuance through the OSS system are listed in Articles 16 to Article 24 MR 27/2018. The following is the procedure along with its requirements in brief:

    1. IPPKH Applicant (Individual, Non-Individual, and Government Agencies) obtain Business Registration Number (NIB) from OSS System;
    2. The IPPKH Applicant submits an IPPKH application through the OSS System;
    3. The IPPKH Applicant includes a statement of commitment and technical requirements;
    4. Based on the application and application requirements, KLHK will access and download applications and requirements from the electronic system;
    5. KLHK will process the application during the examination process within 24 (twenty-four) working days;
    6. The results of the examination process will be in the form of electronic documents that contain:
      1. Technical review of rejection, in the event that it does not meet technical requirements; or
      2. Technical review and maps signed by the Director General if meeting technical requirements.
    7. The results will be submittedtoOSS System in the form of electronic documents either as:
      1. Approval; and
      2. Rejection.
    8. If OSS System issues an Approval, OSS will issue IPPKH based on commitment and the official IPPKH Applicant becomes the IPPKH Holder.
    9. After this stage, IPPKH holder must complete the fulfillment of commitments through OSS System. The following is the fulfillment of commitments based on Article 38 and Article 39 MR 27/2018:
      1. The IPPKH holder submits a report on the fulfillment of commitments through OSS
      2. Reports will be checked within 20 working days (no later)
    10. OSS System will issue a notification in the form of:
      1. statement that the IPPKH Holder has fulfilled all commitments; and
      2. Cancellation of IPPKH if the IPPKH Holder fails to fulfill the commitment.

After the OSS System gives the notification, the IPPKH will be valid and the IPPKH holder can directly carry out business activities.

 

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By combining commercial sensibilities and legal expertise, ADCO as a  Law Firm Jakarta  assists the clients to structure, organize and implement their business ventures and investments, including structuring, financing and securing investments as well as establishing new foreign companies in Indonesia. Should you have more queries regarding this matter, please do not hesitate to contact us.

Dendi Adisuryo
dendi.adisuryo@adcolaw.com

Liza Mashita
liza@adcolaw.com

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This publication has been prepared by Aditya Yudhistira for general informational purposes only to provide clients with information on recent legal developments and is not intended as legal advice or opinion.