9 October 2020
Press Release by Bersihkan Indonesia, Greenpeace, Jatam, Auriga, ICW
For Immediate Release
Who are the Sponsors Behind the Omnibus Bill Task Force and Working Committee?
Jakarta, 9 October 2020 – The Job Creation Bill was passed into law by midnight on Monday, 5 October 2020. This controversial regulation was discussed even on weeknights and weekends at a hotel, its draft was never made publicly available, and it was rushed to be passed into law amid the outbreak of Covid-19. Rejection has been mounting and widespread since the bill was was proposed by President Joko Widodo.
Behind the discussions and the passing of the Bill were great interests of mining businesspeople, who sought legal guarantees for the sustainability and safety of their business. Through a number of political elites and businesspeople in the Omnibus Bill Task Force and Working Committee, the interests were pursued, and were fulfilled with the passing the Omnibus Bill. An analysis of the profiles of the task force and working committee members revealed 12 important actors linked to the mining business, especially the coal business .
“There are 12 intellectual actors who are dispersed and have different roles and functions in the Bill Task Force and Working Committee, namely Airlangga Hartarto, Rosan Roeslani, Pandu Patria Sjahrir, Puan Maharani, Arteria Dahlan, Benny Sutrisno, Azis Syamsudin, Erwin Aksa, Raden Pardede, M Arsjad Rasjid, Bobby Gafur Umar, and Lamhot Sinaga,” said Merah Johansyah, the spokesperson for #BersihkanIndonesia (Cleaning Indonesia) from JATAM.
Airlangga Hartarto, the Coordinating Minister for Economic Affairs behind the creation of the Task Force, for example, is linked to PT Multi Harapan Utama (PT MHU), a coal mining company operating in Kutai Kartanegara, East Kalimantan. The company’s concession area spans 39,972 hectares, the size of Surabaya City. The Provincial Mining and Energy Office of Kalimantan Timur noted that in 2017 PT MHU left behind 56 abandoned mining pits scattered in Kutai Kartanegara, one of which in Loa Ipuh Village, Kilometer 14, killed Mulyadi in December 2015.
Rosan Roeslani, the Chairman of the Indonesian Chamber of Commerce and Industry (Kadin), who is also the Chairman of the Omnibus Bill Task Force, is linked to 36 business entities engaged in the media, pharmaceuticals, financial and financial services, property, oil and gas, coal mining business. Rosan is also listed as a member of the Indonesian Coal Mining Association (APBI).
During the 2019 Presidential Election, Rosan served as the Deputy Chair of the Jokowi-Ma’ruf Amin Winning Team. At that time, serving as the chair of the Team was Erick Thohir, who has been a close friend of Rosan since schooldays.
Meanwhile, Azis Syamsuddin, the Deputy Chair of the Indonesian House of Representatives, is linked to coal mining companies through his closeness to former Regent of Kutai Kartanegara of East Kalimantan Province Rita Widyasari, who is currently a corruption convict. According to Coalruption’s report, Rita appointed Azis as commissioner of a coal mining company belonging to his mother, Sinar Kumala Naga.
The nine other intellectual actors in the Task Force and the Working Committee have different functions and play working group different roles, from being members of the Task Force and the Committee to the chair of the House, but all, after searching #BersihkanIndonesia, are found to be linked to the mining and coal business, directly or indirectly, or personally, either as owners, commissioners or directors.
The Job Creation Bill is just another controversial bill, which was proposed, discussed and endorsed hurriedly by the consolidated oligarchic power in the government and the House. Previously, there were 4 other controversial legal products produced in a similar fashion: the Corruption Eradication Commission (KPK) Law, the Covid Government Regulation In Lieu of Law (Perppu), the Mineral and Coal (Minerba) Law, and the Constitutional Court (MK) Law.
“The Job Creation Law is one of the scenarios created by oligarchs to continue hoarding wealth. The passing of the Bill indicates they are strengthening their foothold, and their scenario is working perfectly. Moreover, this time the KPK too has been weakened,” said Egi Primayogha, a member of ICW’s Political Corruption Division. “They have created rules that deliberately benefit the businesses they own. This is a form of systemic corruption, which can be categorized as a serious crime,” he added.
There is a great design, having been prepared since this regime came to power, to take personal gain at the expense of the people and natural wealth of Indonesia. This is expected when you see how close the drafters of the Bill were to businesspeople; they are even businesspeople themselves, who will benefit from the enactment of the Omnibus Law.
“Our investigation found at least 57% of the Working Committee members being businesspeople themselves. Some are also identified to have been part of the winning and campaign team in the 2019 Presidential Election,” noted Iqbal Damanik, the Mining and Enregy Director of Auriga Nusantara.
Conflicts of interest will push public officials to make decisions and policies that favor their versted interests over the public interest. The conflicts of interest that underlay the birth of the Job Creation Bill have shifted the essential structure of a democratic state to an oligarchy, which no longer serves the public interest. Thus, there has been structured treason by taking effective control of public institutions and their regulations and making them tools to benefit the interests of a few individuals and groups.
“These actors, who are having conflicting interests, produce policies that only favor themselves. In our notes, we identified a number of articles related to the mining and energy sector that benefit mining and coal companies. The Omnibus Law also marks a crisis of democracy and the emergence of a despotic government that continues to strengthen its interests by weakening the people’s voice,” said Tata Mustasya, the Coordinator of Greenpeace Southeast Asia’s Climate and Energy Campaigns.
Among the articles favoring the coal business are the following:
Article 128 A of the Omnibus Law. The addition of the article gives privilege to businesspeople who increase the added value of coal by exempting them from paying royalties to the State. The imposition of 0% royalty on Downstream Coal Companies will benefit companies owned by coal oligarchs.
This will benefit a number of vertically-integrated coal companies such as those involved in coal gasification and coal-fired power plants, even though they restrain the national energy industry by further promoting dirty energy. The grant of 0% royalty will save the dirty coal mining industry, which is facing crisis, price drops, and global pressure to shift to clean, fair and sustainable energy. Bakrie Family Clan’s business, such as the 36-trillion-rupiah Coal Gasification development in Bengalon of East Kutai, will almost certainly enjoy this 0% royalty.
The regulation will save Bumi Resources-controlled coal mining companies, whose credit and debt repayment is due in 2022.
Article 47 A conerning utilization of marine space for the coal industry. One new article is added to Article 47, Article 47A, which stipulates that business license for utilization at sea is granted based on spatial and/or zoning planning. Such a license is granted to activities ranging from marine biopharmacology to oil, gas, mineral and coal mining.
Merah Johansyah, Coordinator with Jaringan Advokasi Tambang (JATAM) Nasional,
Tata Mustasya, Coordinator for Greenpeace Southeast Asia’s Climate and Energy Campaign,
Iqbal Damanik, Mining and Energy Director of Auriga Nusantara,
Egi Primayogha, Researcher with Indonesia Corruption Watch,
Ahmad Ashov Birry, Spokesperson for #BersihkanIndonesia,
- This investigation dag information from official government data such as company profiles at the Directorate General of General Law Administration of the Ministry of Law and Human Rights, and damage track records of mining and coal companies from media clippings and organizations within Koalisi #BersihkanIndonesia
Role: Coordinating Minister for Indonesian Economy Affairs, founder of the Omnibus Bill Task Force, member of the Advisory Board for the Jokowi-Ma’ruf Amin Winning Team.
Position/Company Affiliation: Airlangga used to be a commissioner in coal company PT. Multi Harapan Utama (MHU) in Kutai Kartanegara, East Kalimantan. The company is applying for its exploitation permit (PKP2B) extension. PT MHU concession area covers 39,972 hectares, with its abandoned mining pits spanning 3,748 hectares. According to the East Kalimantan Mining and Energy Office’s 2017 data, PT MHU simply left 56 abandoned mining pits scattered in Kutai Kartanegara, one of which in Loa Ipuh Darat Village, Km 14, killed Mulyadi in December 2015. However, the case disappears without any legal conviction despite legal obligations on MHU’s part to reclaim its abandoned mining pits.
Role: Chair of the House of Representatives of the Republic of Indonesia for the 2019-2024 period, Chair of the Political and Security Affairs of the DPP PDIP for the 2019-2024 period, Jokowi-Amin’s main supporting party in the 2019 Presidential Election
Position/Company Affiliation: Puan Maharani’s husband, Happy Hapsoro, owns, holds a number of positions in, and used to be on the board of directors/commissioners of a number of oil and gas companies, among others: 1) Odira Energy Karang Agung, which is engaged in the oil and gas upstream industry together with PT PP, running an oil block called PSC Odira Energy Karang Agung, which covers an area of 46,649 hectares in Musi Banyuasin, South Sumatra; 2) PT Rukun Raharja, which is engaged in gas infrastructure, gas trading, power generation and upstream business energy. PT Rukun Raharja invests in an oil block in Cepu, East Java capable of producing 220 million barrels of oil per day; 3) Odira Energy Buana (President Director); 4) PT Prima Utama Mandiri (Commissioner); and 5) PT Vetira Prima Perkasa (Director).
Role: Chair of the Omnibus Bill Task Force, General Chair of the Indonesian Chamber of Commerce and Industry (KADIN), Deputy Chair of the Jokowi-Ma’ruf Amin Winning Team
Position/Company Affiliation: Rosan is linked to and associated with 36 companies engaged in the media, pharmaceuticals, financial and financial services, property, oil and gas, and coal mining sectors.
Rosan started his career in financial and financial services business. He held a number of positions in a number of coal mining business entities in the past: PT Arutmin Indonesia (Commissioner 2001-2007), PT Berau Coal (President Director 2010–2013), PT Berau Coal Energy (President Director 2010-2013), BUMI Plc (Non-Executive Director 2010-2012), and PT Kaltim Prima Coal (Commissioner 2003-2007).
Currently, his name is still listed in a number of coal companies, such as PT Mitra Coal Pratama, in a number of energy companies such as Star Amyra Energy and Indonesia Energy Prima, and in a fossil fuel company called Prime Petro Services.
Companies with Rosan’s footprint, such as PT Kaltim Prima Coal (KPC) and Berau Coal (BC), have track records in environmental crimes. BC was once involved in land grabbing in Kampung Gurimbang, disavowal of land acquisition in Tumbit Melayu, Teluk Bayur District, in Berau Regency plus a number of work accidents and violations of B3 waste handling. There are also 45 abandoned mining pits that have not been reclaimed and restored by the company.
KPC itself is also involved in many cases of violence, human rights violations and environmental destruction as well as grabbing of farmers’ and indigenous land. One of the cases, the relocation of the indigenous people of Dayak Basap of Keraitan, East Kutai, has remained problematic to date.
Role: Deputy Chair of KADIN. During the presidential election, Aksa Mahmud’s son was on Prabowo-Sandiaga’s side even though Aksa chose to support Jokowi-Amin. Anyway, whoever won the election, the family clan would still reap political benefit – the proof is the Omnibus Law.
Position/Company Affiliation: President Commissioner of the Bosowa Group, which is engaged in various businesses such as automotive, financial services, property, education, mining and energy. One of the businesses, the steam-powered power plant PLTU Bosowa in Jeneponto, with a capacity of 2X125 MW, is one of the main electricity providers for the State-owned electrical company (PT PLN) in South Sulawesi.
Bobby Gafur Umar
Role: Deputy Chair VIII of the Omnibus Bill Task Force, Deputy Chair of KADIN’s Energy, Oil and Gas. In the 2019 Election, he was among the 10,000 entrepreneurs who on 21 March 2019 declared support for Jokowi.
Position/Company Affiliation: Commissioner of PT Bakrie Brothers Tbk, which controls the metal industry, automotive components, building materials, and infrastructure projects such as PLTU Tanjung Jati A with a capacity of 2X660 MW in Jabat; Kalija gas pipeline; and the Cimanggis-Cibitung Toll Road.
The company also invests in telecommunications, plantations and mining (PT Bumi Resources Tbk, PT Arutmin Indonesia, and PT Kaltim Prima Coal).
Role: Deputy Chair of KADIN’s Monetary, Fiscal and Public Policy; Chair VII of the Omnibus Bill Task Force.
Position/Company Affiliation: Independent Commissioner of ADARO Indonesia, a coal giant.
Adaro Energi has bad track records. In 2003, Adaro evicted the residents of two villages in Paringin and Wonorejo Districts (Lamida Atas and Juai), South Kalimantan. Its mining activities were responsible for floods hitting the community of Tamiang and Ku’u Island.
Global Witness’s report entitled “Adaro’s Overseas Company Network” reveals how Adaro transferred profits to its overseas network during 2009-2017. Doing this allowed Adaro to pay its taxes US $ 125 million lower than it should have. With this transfer, the government estimates Indonesia had potential losses of nearly US $ 14 million dollars per year during the period.
Role: Deputy Chair of KADIN’s Trade, Deputy Chairman of APINDO, Special Staff to the Minister of Industry.
Position/Company Affiliation: President Director of PT Apac Citra Centertex, President Director of PT Apac Inti Corpora, Commissioner of PT Apac Inti Corpora.
The name Benny Soetrisno was once featured in the Riau-1 corruption case. He used to be the Commissioner of PT Serasi Duta Pratama, most of whose shares are affiliated to the consortium for the construction of PLTU MT Riau-1, which includes PT Mandiri Energy Resource, PT Bahagia Sakti Makmur, PT Ausindo Prima Andalas, PT Ausindo Andalas Mandiri, and PT Samantaka Batubara. He is also the President Director of PT Blackgold Energy Power and the President Commissioner of PT Blackgold Energy Indonesia.
Pandu Patria Sjahrir
Role: Member of the Omnibus Bill Task Force, Chair of the Indonesia Coal Mining Association (APBI). APINDO’s Digital Economy Sector. He is a nephew of Luhut Binsar Panjaitan, the Coordinating Minister for Maritime Affairs and Investment who also owns Toba Bara Sejahtera, a coal company in which Pandu is the current director.
Position/Company Affiliation: Member of the Board of Commissioners of Gojek; Director of Toba Bara, President Commissioner of the SEA Group and PT Adimitra Baratama Nusantara (ABN).
In December 2018, houses and roads collapsed after being hit by a landslide caused by the PT ABN’s coal mining operation nearby. In addition, Toba Bara Sejahtera still has not reclaimed and restored its 50 abandoned mining pits.
Role: Chair of the House from the Golkar Party Faction, who led the formulation and endorsement sessions of the Omnibus Bill.
Position/Company Affiliation: Azis Syamsudin is linked to a coal mining company called PT Sinar Kumala Naga in East Kalimantan. His name is listed in the General Law Administration of the Ministery of Law and Human Rights as the commissioner and shareholder, along with Dayang Kartini, the mother of Rita Widyasari – the former Chair of the East Kalimantan Chapter of Golkar, who was arrested by the KPK for corruption in 2017.
His relationship with Golkar is thought to have given him an entry point to have internal shares of the coal company.
Role: Member of the Working Committee from the PDIP faction
Position/Company Affiliation: He serves as a commissioner/director at the Syabas Group, which is engaged in property, plantation, oil and gas and other businesses.
Role: Member of the Working Committee from the Golkar Party faction.
Position/Company Affiliation: He is the CEO of PT. Bakrie Indo Infrastructure owned by the Bakrie Group, Commissioner of PT Eswareco Tama and Sinergi Selaras Mandiri, Director at PT Xoixe Conpival, PT Xoixe Konstruksi, and PT Mega Asri Pratama. He is also a member of the Risk Management Committee for the Board of Commissioners of PTPN IV, and Expert Staff to the Board of Directors of PT Pembangunan Housing, Tbk.
- Arsjad Rasjid
Role: Member of the Omnibus Bill Task Force
Position/Company Affiliation: Indika Energy, PT Kideco Jaya Agung, which controls a 50,921-hectare concession in Paser, East Kalimantan.
Coal company PT Kideco Jaya Agung, which is part of Indika Energy, has a track record for displacing and criminalizing the Paser indigenous people of East Kalimantan.
During 2012-2015, Belian – a Paser traditional ritual held to protest the displacement – and Songka village leader Norhayati of Batu Kajang were reported by the company as violating Article 162 of the Mineral and Coal (Minerba) Law. Such intimidation also involved the police.
For the original release in Bahasa Indonesia, click here.