“25% mining companies have not submitted EITI report in 2012-2013”
JAKARTA—27 of 108 mineral and coal companies have not submitted EITI (Extractive Industry Transparency Initiative) report 2012-2013. While for oil and gas sector, there are 11 of 174 oil and gas companies that have not submitted the EITI report. It becomes bad precedent for transparency on oil, gas and mining governance in Indonesia.
Maryati Abdullah, National Coordinator of Publish What You Pay Indonesia, regrets those companies attitude in the midst of government’s effort to restore the membership status of EITI Indonesia that has been suspended since February 26th, 2015 due to incapability of Indonesia to issue the EITI report period 2012-2013 in timely manner.
“This shows the low commitment and seriousness of companies in acting upon transparency principle as well as supporting Jokowi’s government to improve transparency and accountability in the extractive industry in Indonesia,” said Maryati.
The mining companies that have not submitted the report yet, consist of 1 contract of work’s company, 9 mining licenses of mineral, 2 coal mining agreements, and 15 mining licenses of coal.[1]
Yenny Soetjipto, representative from civil society in the implementation team of EITI Indonesia, urges government to firmly act toward companies that unwilling to report the EITI.
“The unwillingness of companies to report EITI should be used as a tool for government to evaluate the existence of those companies. Moreover the implementation of EITI in Indonesia is one of action that was mandated in Presidential Instruction no. 7/2015 on action to prevent and eradicate corruption, so the companies’ unwillingness can be interpreted as a resistance of anti-corruption movement,” added the Secretariat General of FITRA (Forum Indonesia untuk Transparansi Anggaran).
Yenni added that 38 mining companies that have not submitted the report, should fulfill the data payment report at least next 5th October. “Next, we will consider the consequence for those companies that have not submitted the report. We hope there are sanctions such as announcement on mass media and followed up to the related minister and local government,” emphasized Yenni.
EITI is an international standard to promote transparency in extractive industry through reporting state revenue from extractive industry, in which the process involves multi-stakeholder, i.e: government, public sector, and civil society. The company required to report their payment is company who has worth of IDR 25 Billion royalty. There are 46 countries include Indonesia join EITI. The implementation of EITI in Indonesia is regulated under Presidential Regulation no. 26/2010 on State Revenue and Local Revenue Transparency from Extractive Industry.
The selection of extractive companies in EITI report is made based on total amount contributed by those companies to the total revenue from extractive sector. For oil and gas sector, all of companies have included in the report. While for mining sector, the companies that included in this report are the companies that contribute 80% of corporate income tax revenue and pay royalty worth of IDR 25 Billion (these companies contributed amount 81,67% and 84,65% of revenue from royalty in 2012 and 2013).
On the other hand, the drafting process of EITI 2012-2013 which is still drafted by Independent Administrator, need to be escorted and monitored, especially to meet the EITI Standard 2013, as a benchmark in drafting the EITI report. EITI Standard 2013 requires the addition of contextual information so the report can be more comprehensive and useful for society in understanding the extractive industry in Indonesia and also bring better result of reconciliation.
Additionally, EITI report 2012-2013 need to provide explanation about legal framework and fiscal regime in extractive industry in Indonesia, overview of extractive industry in Indonesia, contribution extractive industry to national economy in Indonesia, data of production, the role of government in improving Indonesia’s extractive industry, allocation of revenue from extractive industry, transparency of contract and mining license, also beneficial ownership.
Jakarta, 27 September 2015