Jakarta, CNN Indonesia – The case of alleged corruption of the Governor of Southeast Sulawesi Nur Alam is the entrance to open the chaos of mines in the country. In addition to the state apparatus, the Corruption Eradication Commission (KPK) is urged to explore the private sector.

The company is considered to be important to be traced. This is related to the alleged value of illegal transactions by the mining sector so far.

Indonesian National Publish What You Pay (PWYP) Coordinator Maryati Abdullah said trillions of illicit money were allegedly flowing annually in the mining sector. This is because of a lack of transparency and accountability in management.

Based on the PWYP study, said Maryati, the allegation of illicit money flow in the mining sector reached Rp23.89 trillion in 2014. The flow of illicit money was estimated to originate from illegal trade (misinvoicing trade) and ‘hot money’ management of the mining sector.

“The basic problem is with the mining permit mechanism itself,” said Maryati some time ago.

The flow of hot money, said Maryati, comes from the practice of money laundering, corruption, tax evasion, and illegal transactions. Specifically for the transaction, PWYP found the practice to occur because of the alleged not recording of business transactions.

Maryati, citing KPK data, said that the anti-corruption agency found around Rp28.5 trillion of potential Non-Tax State Revenue (PNBP) in the mineral and coal sector was lost in 2014. That, he said, was due to problems from poor mining permit management.

“This is thought to have happened because of the rise of illegal mines operating and unregistered cases of export of mining commodities,” said Maryati.

The problem also arises related to the central and regional authorities. He said the decentralization of the authority to regulate mining licenses of local governments was not accompanied by good coordination between the two.

One example, Maryati said, there are still many permits and mapping of mining areas that overlap with forestry permits. Not only that, but also with protected or conservation forest areas.

Based on the results of joint monitoring of PWYP and KPK, there are still 3,982 Mining Business Permits (IUP) that are not clean and clear (CnC) from a total of 10,348 IUPs in Indonesia. The monitoring was carried out through the KPK’s Coordination and Supervision efforts. The status of CnC in general is that permits do not overlap with other regional permits and comply with regulations.

The findings stated that there were still IUPs issued by local governments that were not recorded at the Ministry of Energy and Mineral Resources, but instead recommended to obtain CnC status to the provinces. Others, there are also IUP with CnC status in the Ministry of Energy and Mineral Resources but not recorded in the Regional Government.

In addition, PWYP also found that many mining licenses had expired but had not been revoked. Not a little too, said Maryati, IUP which is in protected and conservation forest areas.

“Based on Law No. 41 of 1999 concerning Forestry, it is clear that mining activities should only be carried out in production forests and protected forests by conducting underground mining,” Maryati said.

The problem was not solved in the overlapping issue, but also the reclamation guarantee fund. According to Maryati, of 10,348 IUPs, there were only 1,138 companies that fulfilled reclamation and post-mining obligations. In fact, company commitments related to reclamation and post-mining guarantee funds are part of the requirements for the government to issue IUPs.

The official statement of the Ministry of Energy and Mineral Resources said there were still around 75 percent of IUPs that did not deposit reclamation and post-mining guarantees out of 10,428 IUPs.

Trap Corporation

There are efforts that have been made by the government. The Ministry of Energy and Mineral Resources itself provides sanctions for revocation of non-compliance by companies in submitting reports on mining activities.

There are around 83 companies whose licenses have been revoked and around 36 companies are in the process of revoking IUP.

Related to the alleged corruption, the company also needs to be the next KPK shot. KPK Chairman Agus Raharjo previously said that in the near future he would immediately establish corporations as perpetrators of corruption.

Corporate punishment, said Agus, was motivated by the existence of an individual mode as the mastermind behind corporate corruption. In fact, he assessed, directly corporations are also the main connoisseurs of corruption committed by these individuals.
Because of this, Agus stated, the step of criminal punishment of corporations as perpetrators of corruption is aimed at making the entity bankrupt so that there is a deterrent effect.

“So if corporations benefit from corruption, corporations must also be responsible, not just the people,” Agus said.

Concerning corporations, pressure also came from environmental organizations, the Indonesian Forum for the Environment (Walhi). Walhi urged the KPK to snare companies suspected of being involved in mining permit corruption in Southeast Sulawesi.

The Head of the Campaign and Network Expansion Department of Walhi Khalisah Khalid said the company was the beneficiary of the mining permit,

“Public officials must continue to be prosecuted, but the KPK must also be able to ensnare the corporations involved. From here, the company is also making a profit which is clearly detrimental to the country, “Khalisah said last week.

Mining corruption, said Khalisah, did not only occur due to public officials who neglected regulations. But, he continued, also because companies are looking for legal loopholes in order to launch their businesses. (hope)

Source: here.

In Media, Media Coverage | PWYP Indonesia | August 20th, 2016