Keep Us Strong WikiLeaks logo

Currently released so far... 97115 / 251,287

Articles

Browse latest releases

Browse by creation date

Browse by origin

A B C D F G H I J K L M N O P Q R S T U V W Y Z

Browse by tag

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
ETRD EAGR ETTC EAID ECON EFIN ECIN EINV ELAB EAIR ENRG EPET EWWT ECPS EIND EMIN ELTN EC ETMIN EUC EZ ET ELECTIONS ENVR EU EUN EG EINT ER ECONOMICS ES EMS ENIV EEB EN ECE ECOSOC EK ENVIRONMENT EFIS EI EWT ENGRD ECPSN EXIM EIAD ERIN ECPC EDEV ENGY ECTRD EPA ESTH ECCT EINVECON ENGR ERTD EUR EAP EWWC ELTD EL EXIMOPIC EXTERNAL ETRDEC ESCAP ECO EGAD ELNT ECONOMIC ENV ETRN EIAR EUMEM ENRGPARMOTRASENVKGHGPGOVECONTSPLEAID EREL ECOM ECONETRDEAGRJA ETCC ETRG ECONOMY EMED ETR ENERG EITC EFINOECD EURM EENG ERA EXPORT ENRD ECONEINVETRDEFINELABETRDKTDBPGOVOPIC EGEN EBRD EVIN ETRAD ECOWAS EFTA ECONETRDBESPAR EGOVSY EPIN EID ECONENRG EDRC ESENV ETT EB ENER ELTNSNAR ECHEVARRIA ETRC EPIT EDUC ESA EFI ENRGY ESCI EE EAIDXMXAXBXFFR EETC ECIP EIAID EIVN EBEXP ESTN EING EGOV ETRA EPETEIND ELAN ETRDGK EAIDRW ETRDEINVECINPGOVCS EPEC ENVI ELN EAG EPCS EPRT EPTED ETRB EUM EAIDS EFIC EFINECONEAIDUNGAGM EAIDAR ESF EIDN ELAM EDU EV EAIDAF ECN EDA EXBS EINTECPS ENRGTRGYETRDBEXPBTIOSZ EPREL EAC EINVEFIN ETA EAGER EINDIR ECA ECLAC ELAP EITI EUCOM ECONEFINETRDPGOVEAGRPTERKTFNKCRMEAID EARG ELDIN EINVKSCA ENNP EFINECONCS EFINTS ECCP ETC EAIRASECCASCID EINN ETRP EAIDNI EFQ ECOQKPKO EGPHUM EBUD ECONEINVEFINPGOVIZ ENERGY ELB EINDETRD EMI ECONEFIN EIB EURN ETRDEINVTINTCS EIN EFIM ETIO ELAINE EMN EATO EWTR EIPR EINVETC ETTD ETDR EIQ ECONCS EPPD ENRGIZ EISL ESPINOSA ELEC EAIG ESLCO EUREM ENTG ERD EINVECONSENVCSJA EEPET EUNCH ECINECONCS ETRO ETRDECONWTOCS ECUN EFND EPECO EAIRECONRP ERGR ETRDPGOV ECPN ENRGMO EPWR EET EAIS EAGRE EDUARDO EAGRRP EAIDPHUMPRELUG EICN ECONQH EVN EGHG ELBR EINF EAIDHO EENV ETEX ERNG ED
KMDR KPAO KPKO KJUS KCRM KGHG KFRD KWMN KDEM KTFN KHIV KGIC KIDE KSCA KNNP KHUM KIPR KSUM KISL KIRF KCOR KRCM KPAL KWBG KN KS KOMC KSEP KFLU KPWR KTIA KSEO KMPI KHLS KICC KSTH KMCA KVPR KPRM KE KU KZ KFLO KSAF KTIP KTEX KBCT KOCI KOLY KOR KAWC KACT KUNR KTDB KSTC KLIG KSKN KNN KCFE KCIP KGHA KHDP KPOW KUNC KDRL KV KPREL KCRS KPOL KRVC KRIM KGIT KWIR KT KIRC KOMO KRFD KUWAIT KG KFIN KSCI KTFIN KFTN KGOV KPRV KSAC KGIV KCRIM KPIR KSOC KBIO KW KGLB KMWN KPO KFSC KSEAO KSTCPL KSI KPRP KREC KFPC KUNH KCSA KMRS KNDP KR KICCPUR KPPAO KCSY KTBT KCIS KNEP KFRDCVISCMGTCASCKOCIASECPHUMSMIGEG KNNB KGCC KINR KPOP KMFO KENV KNAR KVIR KDRG KDMR KFCE KNAO KDEN KGCN KICA KIMMITT KMCC KLFU KMSG KSEC KUM KCUL KMNP KSMT KCOM KOMCSG KSPR KPMI KRAD KIND KCRP KAUST KWAWC KTER KCHG KRDP KPAS KITA KTSC KPAOPREL KWGB KIRP KJUST KMIG KLAB KTFR KSEI KSTT KAPO KSTS KLSO KWNN KPOA KHSA KNPP KPAONZ KBTS KWWW KY KJRE KPAOKMDRKE KCRCM KSCS KWMNCI KESO KWUN KPLS KIIP KEDEM KPAOY KRIF KGICKS KREF KTRD KFRDSOCIRO KTAO KJU KWMNPHUMPRELKPAOZW KEN KO KNEI KEMR KKIV KEAI KWAC KRCIM KWCI KFIU KWIC KCORR KOMS KNNO KPAI KBWG KTTB KTBD KTIALG KILS KFEM KTDM KESS KNUC KPA KOMCCO KCEM KRCS KWBGSY KNPPIS KNNPMNUC KWN KERG KLTN KALM KCCP KSUMPHUM KREL KGH KLIP KTLA KAWK KWMM KVRP KVRC KAID KSLG KDEMK KX KIF KNPR KCFC KFTFN KTFM KPDD KCERS KMOC KDEMAF KMEPI KEMS KDRM KEPREL KBTR KEDU KNP KIRL KNNR KMPT KISLPINR KTPN KA KJUSTH KPIN KDEV KTDD KAKA KFRP KWNM KTSD KINL KJUSKUNR KWWMN KECF KWBC KPRO KVBL KOM KFRDKIRFCVISCMGTKOCIASECPHUMSMIGEG KEDM KFLD KLPM KRGY KNNF KICR KIFR KM KWMNCS KAWS KLAP KPAK KDDG KCGC KID KNSD KMPF KPFO KDP KCMR KRMS KNPT KNNNP KTIAPARM KDTB KNUP KPGOV KNAP KNNC KUK KSRE KREISLER KIVP KQ KTIAEUN KPALAOIS KRM KISLAO KWM KFLOA
PHUM PINR PTER PGOV PREL PREF PL PM PHSA PE PARM PINS PK PUNE PO PALESTINIAN PU PBTS PROP PTBS POL POLI PA PGOVZI POLMIL POLITICAL PARTIES POLM PD POLITICS POLICY PAS PMIL PINT PNAT PV PKO PPOL PERSONS PING PBIO PH PETR PARMS PRES PCON PETERS PRELBR PT PLAB PP PAK PDEM PKPA PSOCI PF PLO PTERM PJUS PSOE PELOSI PROPERTY PGOVPREL PARP PRL PNIR PHUMKPAL PG PREZ PGIC PBOV PAO PKK PROV PHSAK PHUMPREL PROTECTION PGOVBL PSI PRELPK PGOVENRG PUM PRELKPKO PATTY PSOC PRIVATIZATION PRELSP PGOVEAIDUKNOSWGMHUCANLLHFRSPITNZ PMIG PREC PAIGH PROG PSHA PARK PETER POG PHUS PPREL PS PTERPREL PRELPGOV POV PKPO PGOVECON POUS PGOVPRELPHUMPREFSMIGELABEAIDKCRMKWMN PWBG PMAR PREM PAR PNR PRELPGOVEAIDECONEINVBEXPSCULOIIPBTIO PARMIR PGOVGM PHUH PARTM PN PRE PTE PY POLUN PPEL PDOV PGOVSOCI PIRF PGOVPM PBST PRELEVU PGOR PBTSRU PRM PRELKPAOIZ PGVO PERL PGOC PAGR PMIN PHUMR PVIP PPD PGV PRAM PINL PKPAL PTERE PGOF PINO PHAS PODC PRHUM PHUMA PREO PPA PEPFAR PGO PRGOV PAC PRESL PORG PKFK PEPR PRELP PREFA PNG PGOVPHUMKPAO PRELECON PINOCHET PFOR PGOVLO PHUMBA PRELC PREK PHUME PHJM POLINT PGOVPZ PGOVKCRM PGOVE PHALANAGE PARTY PECON PEACE PROCESS PLN PRELSW PAHO PEDRO PRELA PASS PPAO PGPV PNUM PCUL PGGV PSA PGOVSMIGKCRMKWMNPHUMCVISKFRDCA PGIV PRFE POGOV PEL PBT PAMQ PINF PSEPC POSTS PHUMPGOV PVOV PHSAPREL PROLIFERATION PENA PRELTBIOBA PIN PRELL PGOVPTER PHAM PHYTRP PTEL PTERPGOV PHARM PROTESTS PRELAF PKBL PRELKPAO PKNP PARMP PHUML PFOV PERM PUOS PRELGOV PHUMPTER PARAGRAPH PERURENA PBTSEWWT PCI PETROL PINSO PINSCE PQL PEREZ PBS

Browse by classification

Community resources

courage is contagious

Viewing cable 08JAKARTA2293, INDONESIA'S LEGISLATURE PASSES NEW MINING LAW

If you are new to these pages, please read an introduction on the structure of a cable as well as how to discuss them with others. See also the FAQs

Understanding cables
Every cable message consists of three parts:
  • The top box shows each cables unique reference number, when and by whom it originally was sent, and what its initial classification was.
  • The middle box contains the header information that is associated with the cable. It includes information about the receiver(s) as well as a general subject.
  • The bottom box presents the body of the cable. The opening can contain a more specific subject, references to other cables (browse by origin to find them) or additional comment. This is followed by the main contents of the cable: a summary, a collection of specific topics and a comment section.
To understand the justification used for the classification of each cable, please use this WikiSource article as reference.

Discussing cables
If you find meaningful or important information in a cable, please link directly to its unique reference number. Linking to a specific paragraph in the body of a cable is also possible by copying the appropriate link (to be found at theparagraph symbol). Please mark messages for social networking services like Twitter with the hash tags #cablegate and a hash containing the reference ID e.g. #08JAKARTA2293.
Reference ID Created Released Classification Origin
08JAKARTA2293 2008-12-19 06:12 2011-08-24 01:00 UNCLASSIFIED Embassy Jakarta
VZCZCXRO0413
RR RUEHCHI RUEHCN RUEHDT RUEHHM
DE RUEHJA #2293/01 3540612
ZNR UUUUU ZZH
R 190612Z DEC 08
FM AMEMBASSY JAKARTA
TO RUEHC/SECSTATE WASHDC 1017
INFO RUEHZS/ASSOCIATION OF SOUTHEAST ASIAN NATIONS
RUEHKO/AMEMBASSY TOKYO 2869
RUEHBY/AMEMBASSY CANBERRA 3429
RUEHBJ/AMEMBASSY BEIJING 5750
RUEHJS/AMCONSUL SURABAYA 2340
RHMFISS/DEPT OF ENERGY WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
UNCLAS SECTION 01 OF 02 JAKARTA 002293 
 
DEPT FOR EAP/MTS AND EB/ESC/IEC/ENR 
DOE FOR PI-32 CUTLER AND GILLESPIE 
COMMERCE FOR 4430/NADJMI AND 6930/HUEPER 
DEPT PASS USTR EHLERS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: EPET ENRG EINV PREL ID
SUBJECT: INDONESIA'S LEGISLATURE PASSES NEW MINING LAW 
 
JAKARTA 00002293  001.2 OF 002 
 
 
1. Summary.  On December 16, Indonesia's legislature (DPR) passed a 
new mining law that will promote domestic small and medium sized 
investments at the expense of large international mining companies. 
Bowing to opposition from the Ministry of Energy and Mineral 
Resources, the DPR agreed that the law will not force existing 
mining contracts of work (COW) to convert to mining licenses, 
although provisions remain that erode the sanctity of current 
contracts.  Industry reaction to the new bill has been almost 
universally negative, with trade groups predicting that uncertainty 
will increase, causing foreign investment to decrease.  The law also 
seeks to build local government capacity to oversee mining 
operations.  End Summary. 
 
------------------------- 
NO MORE CONTRACTS OF WORK 
------------------------- 
 
2. Policymakers have sought to revise Indonesia's 1967 Mining Law 
for some time, to reflect the new, decentralized governing 
structure.  In earlier versions of the new bill, legislators sought 
to eliminate existing contracts of work (COW) and replace them with 
mining licenses.  A COW defines a mining company's rights and 
obligations in all aspects of a mining operation - tax and fee 
obligations, royalties, concession size and duration, land use, 
construction of facilities, divestiture requirements, etc. - and it 
remains independent of Indonesia's overall tax and corporate laws 
for the duration of the COW.  In the system of mining licenses 
created in the new law, licenses give the right to mine in a defined 
area but leave the mining company subject to all changes in 
Indonesia's mining, tax, and corporate laws.  Legislators were 
unhappy with the prospect of a two-tier COW/licensing system for the 
duration of current COWs, many of which will remain valid for 
decades. 
 
3. The Ministry of Energy and Mineral Resources resisted the DPR's 
plans to convert COWs, and the President threatened to veto earlier 
versions of the proposed bill over this issue.  In the end, the DPR 
gave in and grandfathered existing COWs.  Nevertheless the 
legislation mandates undefined changes to "non-state-revenue" COW 
provisions to comply with the new law. 
 
-------------------------- 
NEGATIVE BUSINESS REACTION 
-------------------------- 
 
4. Business reaction to the new law has been negative.  Priyo 
Pribadi Soemarno, Executive Director of the Indonesian Mining 
Association (IMA), a business group that includes foreign and 
domestic mining companies, believes that it will further erode 
Indonesia's mining investment climate.  The new risks and 
limitations for mining companies that the law creates include: 
 
-- Government can cancel mining licenses, with little recourse from 
an affected company. 
-- Companies will be subject to all changes in royalties, taxes, 
fees, and corporate ownership.  Soemarno highlighted the fact that 
all levels of Indonesian government have reputations for frequently 
imposing new financial obligations on resource extraction 
companies. 
-- Foreign mining companies must begin a divestment program within 5 
years of production, even though Indonesia's investment laws allow 
foreign companies to own 100% of a mining operation.  Divestment 
problems have caused major challenges for a number of foreign mining 
companies in Indonesia, most recently Newmont. 
-- Concession areas are smaller than in the past, which works 
against the business plans of large companies such as Freeport, 
Newmont, and Rio Tinto. 
-- Companies can no longer export unprocessed ore, but must smelt it 
in-country.  Legislators hope this provision will spur new 
value-added industries, but industry analysts fear that this 
requirement may give local smelters monopoly-pricing powers. 
-- Mining companies are barred from hiring subsidiaries and 
affiliates for mining operations.  Companies must give preference to 
local and national companies when subcontracting, although local 
subsidiaries of international companies qualify as national 
companies. 
 
------------------ 
THERE IS AN UPSIDE 
------------------ 
 
 
JAKARTA 00002293  002.2 OF 002 
 
 
5. The law addresses local governments' lack of institutional 
capacity to manage licenses.  Provincial and regency governments 
have had the authority to issue mining licenses to domestic 
companies for several years, but previously there was no attempt to 
train these levels of government in contracting, management, or 
oversight of mines.  The new law obligates central government 
ministries to train local governments on a range of mining oversight 
issues, including safety, research, and environmental issues.  The 
law also states that central government ministries retain the 
primary authority to inspect mining operations, although they can 
delegate this right to local governments at their discretion. 
 
----------------------------- 
KEY PROVISIONS OF THE NEW LAW 
----------------------------- 
 
6. Types of Licenses 
-- Mining Permit (IUP): Awarded by central or local governments 
(governor, mayor, or regent) through tender. 
-- Special Mining Permit (IUPK): Awarded only by the central 
government through tender for mining regions designated as State 
Reserve Areas.  Only for coal, copper, lead, gold, iron, nickel, and 
bauxite. 
-- People's Mining Permit (IPR): Awarded by a mayor or regent, only 
for small-scale mining (currently unlicensed and considered 
illegal). 
 
7. License Duration 
-- IUP and IUPK: Exploration licenses are for 7 or 8 years. 
Production licenses are for 20 years for coal and metal, 10 years 
for precious stones, all with the option of two 10-year extensions. 
-- IPR: Production license is valid for 5 years, but extendable. 
 
8. Concession Size 
-- IUP and IUPK: Exploration concessions of 100,000 hectares (ha) 
for metal, 50,000 ha for coal.  Production concessions capped at 
25,000 ha for metal, 15,000 ha for coal. 
-- IPR: Individual license - 1 ha; group license - 5 ha; cooperative 
- 10 ha. 
 
9. Foreign Ownership: Foreign companies are allowed to own 100% of 
mining operations under Indonesia's investment law, but must begin 
an undefined divestment process within five years of production 
under the new mining law. 
 
10. Royalties:  All license holders must pay royalties, to be 
defined by regulation.  IUPK holders must additionally pay 10% of 
their production to the government - 4% central government, 1% 
provincial, 2.5% regency of production, 2.5% other regencies in the 
province. 
 
11. In-Country Processing: IUP and IUPK holders must refine their 
product inside Indonesia, whether by establishing their own smelters 
or using others.  COW holders have 5 years to comply with this 
requirement. 
 
12. Subcontracting: License-holders cannot subcontract to 
subsidiaries, and they must give preference to local or national 
mining service companies in their operations. 
 
13. Production Controls: The central government may set provincial 
production limits for certain commodities and mandate domestic 
market obligations. 
 
HUME