Indonesian government failing to collect $1bn in deforestation fines

25.08.2017

The remains of a burnt tree in East Kalimantan, Indonesia Photo: Josh Estey/AusAID, used under Creative Commons license

The Indonesian government is failing to make firms convicted of illegal deforestation pay more than US$1 billion in fines, hampering efforts to restore the peat and forest habitats damaged by their operations.

In 2016, a Supreme Court verdict ordered the timber firm PT Merbau Pelalawan to pay 16 trillion rupiah (US$1.2 billion) for illegally clearing 5,590 hectares of forest near Sumatra’s east coast. But the firm has not yet paid the fine, and recently filed a case review challenging the Supreme Court’s verdict.

In 2015, the oil palm company PT Kallista Alam was fined 360 billion rupiah – more than US$27 million – for clearing 1,000 hectares of land in the Tripa peat swamp region of Sumatra’s northwest coast. Initially, the firm filed a case review against the court’s decision, which was rejected. Then, in July 2017, the company sued the government, alleging that the coordinates for its concession used by the ministry in court were wrong. Observers have questioned why the issue was not settled during the original trial.

The Ministry of Environment and Forestry is considering new measures to force companies to pay, including forming a task force invested with more power to enforce the rulings. The proposal would unite officials from several relevant government agencies, including the Financial Transaction Reports and Analysis Center, the Financial Services Authority, the Attorney General’s Office and the Ministry of Law and Human Rights.

Fines levied on firms for illegal deforestation serve two purposes: compensation for the state, and funds to fully restore the affected forests back to their original condition. Failure to collect fines prevents these restoration efforts taking place, according to Ministry officials.

More from Blog

Leather / BMW fails to substantiate allegations against Earthsight’s research    





Continue reading
It is essential that a mandatory public list of non-compliant businesses is included in the final regulation to curb EU-driven deforestation and forest degradation

Continue reading
Brazil / World’s largest sovereign wealth fund finds beef giant guilty of driving illegal deforestation

Continue reading
Grand Theft Chaco II / Paraguay Senate seeks accountability from government following Earthsight illegal deforestation exposé

Continue reading
EU anti-deforestation law / Suspect timber firms lobby for certified wood ‘green lane’ in draft proposal

Continue reading
Open letter / Paraguay must halt invasions, deforestation of indigenous Ayoreo lands

Continue reading
FSC hall of shame / The ethical wood label’s long line of scandals

Continue reading
Open letter / Ethical wood label FSC is no longer fit for purpose and must urgently reform

Continue reading
UK Environment Bill / Government proposals to end UK role in driving deforestation overseas must be beefed up for benefits to be realised

Continue reading
Ikea's House of Horrors / Ikea, FSC actions on Siberia illegal logging scandal are a start. In our climate crisis, they must do much more

Continue reading

Stay up to date with all Earthsight news & updates

Receive email updates for the latest news and insights from Earthsight and be among the first to read our new investigations.

We keep your data secure and don’t share anything with third parties. Read full terms.