Historic Court Ruling against Palm Oil Company to Benefit Orangutans

 

by Donna Clifford-Jones, Norman, OK.

tripaburnsIndonesia’s position as one of the world’s largest producers of palm oil and concomitant leadership in global deforestation continues to have devastating consequences for Sumatra’s orangutans.[1]  Over time the species has been increasingly driven out of its natural habitat with the clearing, burning and conversion of forests into palm oil plantations.[2]  This is especially seen in the Tripa peat swamp forest in Aceh province which is a critical habitat for orangutans.[3]  The forest is part of the legally protected Leuser Ecosystem, designated as a National Strategic Area for environmental protection, and where it is illegal to issue permits for palm oil, mining or other damaging activities.[4]  Unfortunately, the profit motive has seen the palm oil companies intrude into this protected area which is now in a perilous condition.

Prosecutions have been sought against a number of companies for illegal activities relating to the forest destruction.[5]  The remainder of this article will describe the legal proceedings initiated against one company, PT Kallista Alam.  In the wider sense, the case illustrates the competing agendas of the local and central governments of Indonesia in dealing with the economic and environmental issues facing the country.  In the narrower sense, the case offers a ray of hope for the survival of Sumatra’s orangutans.

Background to case

In May 2011, Indonesia’s President Susilo Bambang Yudhoyono placed a two year national moratorium on new permits in primary forests and peat lands.  The decision was required by the agreement on REDD (Reduced Emissions from Deforestation and Forest Degradation), a climate agreement with the objective of protecting primary forests and peat lands to cut carbon emissions.[6]  The effect of the President’s moratorium was that new plantation developments would be prohibited in many parts of the Tripa peat swamp forest.

On August 25, 2011, the Governor of Aceh province, Irwandi Yusuf, infringed the moratorium by issuing a permit to the company PT Kallista Alam.  This allowed it to develop 1,605 hectares in the Tripa peat swamp forest into an oil palm plantation.[7]  The oversight organization monitoring the moratorium, the Presidential Working Union for Supervision and Management of Development (UKP4), criticized the decision and advised the Governor to select alternative land for the permit.  The provincial government defended the Governor’s decision stating that the permit had been correctly issued.[8]

On October 24, 2011, local NGOs sent a letter to the Governor stating they would take legal action if he failed to withdraw the permit.  With no action forthcoming and the ongoing rhetoric from groups like PanEco and YEL stating they would challenge the permit’s legality in court, communities decided to report the permit violation to the national police in Jakarta.  Some of these groups ended up assisting in the subsequent legal proceedings by bringing national and international media attention to the Tripa area.[9]

Additionally, environmental groups persuaded senior officials in the government and specifically the Ministry of Environment (MOE) to investigate the matter further.[10]  The head of the task force for the REDD+ agency also asked the MOE to investigate because of the permit’s violation of the national moratorium.[11]

The MOE’s formal investigation in May, 2012, revealed that the company had been clearing forests in the Tripa area for up to ten months prior to receiving the permit.[12]  Satellite imagery and community reports identified concessions of both PT Kallista Alam and other companies that had breached the moratorium and Spatial Planning Law of 2007, which makes it illegal and a criminal offence to use fire to clear forests on peat lands.[13]  But despite the investigation, the forest clearance, peat lands drainage and burning continued.

Legal proceedings

A series of legal proceedings have revolved around the above events involving a number of different parties.

Lawsuit filed by WALHI

The first of these proceeding took place on November 23, 2011, when WALHI filed a lawsuit to revoke the permit against Governor Irwandi Yusuf and PT Kallista Alam at the Administrative Court of Banda Aceh.[14]  It argued that the permit was issued illegally in a protected area within the Leuser Ecosystem and that it violated the moratorium on new permits.[15]

The case was dismissed at first instance with the judge citing lack of capacity.  WALHI successfully appealed the decision at the Medan State Administrative High Court, where the court found violations in the issuance of the permit and at least one illegal concession owned by the company.  The court ordered the new Governor of Aceh, Zaini Abdullah, to cancel the permit in the illegal concession.[16]  On September 27, 2012, the permit was withdrawn in the new Governor’s decree, revoking the decree of former Governor.[17]

The company appealed the decision to the Supreme Court in Jakarta.  It also filed a separate lawsuit against the new Governor in the Administrative Court of Banda Aceh.  Lawyers for the company told The Globe Journal that as litigants they were “requested to improve the lawsuit”.[18]  The Government of Aceh’s Legal Division and PR challenged the suit in response.[19]

WALHI’s motion to intervene

On December 13, 2012, WALHI motioned to intervene and join as a co-defendant with the Governor against the suit.  The company objected to the motion stating WALHI had no interest in the case.  WALHI maintained that the motion was based on the original case filed against the former Governor and the legal precedent set by that case, that being the decision instructing the new Governor to revoke the permit.  WALHI also stated that it wanted to demonstrate its support for the new Governor’s decision.[20]  The court granted the motion on January 8, 2013.

For the remainder of the session, PT Kallista’s lawyers requested the court cancel the permit revocation or at least postpone that decision until the appeal to the Supreme Court in Jakarta was finalized.  The court granted the request and moved to continue the trial to January 23, 2013.[21]

The appeal to the Supreme Court was later rejected, upholding the Medan State Administrative High Court’s decision and order that the new Governor revoke the permit.[22]

Lawsuit filed by MOE

A second set of proceedings took place on November 8, 2012, when prosecutors from the Attorney General’s Office representing the MOE filed civil and criminal lawsuits against PT Kallista Alam at the District Court of Meulaboh.  The charges were illegal clearing of peat lands by burning and causing environmental damage in the Tripa peat swamp forest.  A P16 “Order of Appointment for the Public Prosecutor to Observe the Development of the Investigation of the Crime” was prepared for the criminal case.[23]

The first civil trial hearing took place on November 27, 2012, but was postponed because PT Kallista Alam’s lawyers failed to appear.  The documents for the criminal lawsuit were still under evaluation by the Attorney General but once completed were to be sent to the District Court for both the civil and criminal proceedings to be conducted there.[24]

The next civil trial hearing was held on December 12, 2012, to verify the parties’ identification.  The session only lasted fifteen minutes and was postponed to January 7, 2013, because PT Kallista’s lawyers failed to submit a written power of attorney.  An interview with The Globe Journal confirmed they had only been verbally assigned to represent the company.[25]

At some point a mediation hearing was arranged for January 30, 2013, at the District Court of Meulaboh.  The mediation was an attempt to settle the civil case, with the stipulation that the company pay compensation for the environmental damage caused through clearing the peat lands by burning.  [The stipulation was based on the obligation to rehabilitate which was part of the original civil law suit].[26]

A further hearing followed on July 7, 2013, with the MOE’s first expert witness stating that damage to the Tripa Peat swamp forest was caused by frequent flooding, which was caused in turn by destruction of the peat by fire and the opening of the canals.  A second expert witness stated that the fire in the company’s concession was caused by a human act and that he had based his findings on field visits to the area.[27]

Over the ensuing months protestors both in favor and against PT Kallista Alam gathered at the court.  On July 11, 2012, protestors against the company demanded immediate withdrawal of the permit and payment to the community for damages caused to the land.[28]  On November 15, 2012, protestors in support of the company, who had been paid to disrupt proceedings, demanded a decision be found in PT Kallista’s favor.[29]

Despite the intimidation tactics from protestors, the court ordered PT Kallista’s assets be frozen, and scheduled a final hearing for December 5, 2012, when a ruling was to be delivered.  But this date was also postponed.[30]  Kamaruddin, a lawyer representing the Tripa community, and Deddy Ratih, WALHI’s Spatial Planning Campaigner, stated in separate accounts they believed the company was prolonging the proceedings to avoid a judgment against it.[31]

District Court’s ruling

One month later, on January I, 2014, the court handed down its final ruling in the civil case against PT Kallista Alam.  The company was found guilty of illegally clearing peat land forest by burning within the protected Tripa peat swamp forest in violation of the national law 32/2009 on Environmental Protection and Management.

The court ordered that the company pay Rupiah 114.3 billion (USD 9.4 million) compensation to the state and an environmental restoration fee of Rupiah 251.7 billion (USD 20.6 million) to rehabilitate the land destroyed.[32]  A daily fine of 5 million rupiah (USD 423) was imposed for each day the compensation and restoration costs remain unpaid.  The court also ordered that 5,769 hectares of the company’s land be seized.[33]

At the time of the decision, the criminal case was still under evaluation by the Attorney General’s Office.  Alfian Sarumaha, PT Kallista’s lawyer stated that he expected the company to appeal the decision.[34]

Consequences of the court’s ruling for orangutans

The court’s ruling established a new historic precedent that reinforced protection of primary forests and peat lands under the existing moratorium and the law prohibiting the use of fire to clear land.  The expectation is that this will deter companies from future illegal clearing and burning in protected areas.[35]  This should result in slowing down the destruction of further orangutan habitat.

The company may appeal the decision.  If it appeals and loses or fails to appeal, the court’s ruling will enter into legal force.  The order to pay an environmental restoration fee will then be used to develop a plan to rehabilitate the land to its natural state, although the prospect is that the land could take three decades to recover completely.[36]  Restoration projects like this, though a move in the right direction will have no immediate benefit to the orangutan habitat.

The ruling has also generated increased international awareness and support for the need to protect Aceh’s forests, with petitions collected from over one and a half million signatures.[37]  This is an important outcome, along with spreading the message to avoid the purchase of palm oil products.  Ideally this should decrease the pressure on using protected areas of land for palm oil plantations which will benefit orangutans.

Finally, the ruling sets a precedent for future legal proceedings which may need to be relied on if the new provincial spatial plan by-law that ignores the protected status of the Leuser Ecosystem becomes law and legal proceedings ensue.[38]  The question then becomes whether the precedent will be followed when the entire Leuser Ecosystem is under threat.  The implementation of such a by-law will have significant impact on orangutan habitat and perhaps be the deciding factor in the long term survival of the species.  With this outlook there is no room for complacency in the battle to protect the forests of Sumatra and its orangutans.



[2]endoftheicons (2013), “Indonesia: Orangutans in big trouble”, endoftheicons, 22 February [accessed on 18 May 2014].

[3] SOS Sumatran Orangutan Society (2014). “Groundbreaking rule against the destruction of the Tripa Peat Swamp forests” SOS Sumatran Orangutan Society [accessed on 6 June, 2014].

[4]endoftheicons (2013), “Rogue Palm Oil Company, Fearing Negative Ruling, Initiates Conflict with Indonesian Court”, endoftheicons, 15 November [accessed on 18 May 2014].

[5] Sumatran Orangutan Conservation Programme (2014), “Palm Oil Company fined Millions as Indonesian Court delivers historic ruling against illegal destruction of Tripa Peat Swamp Forests”, Sumatran Orangutan Conservation Programme, 9 January [accessed on 19 May 2014].

[6]endoftheicons (2012), “Rebel hero who has ‘betrayed’ the last of Aceh’s orang-utans”, endoftheicons, 27 March [accessed on 18 May 2014].

[7]endoftheicons (2012), “Indonesia’s Aceh breaches forest clearing moratorium”, endoftheicons, 27 March [accessed on 18 May 2014].

[8] Ibid.

[9] BOS Canada (2013) “For the Protection of wild and rehabilitant orangutans & their native habitat”, News 2013 [accessed on 18 May 2014].

[10]endoftheicons (2014), “In precedent-setting case, palm oil company fined $30M for destroying orangutan forest”, endoftheicons, 10 January [accessed on 18 May 2014].

[11]endoftheicons (2012), “PRESS RELEASE: Investigation result from REDD+ Task Force in Tripa”endoftheicons, 17 April [accessed on 17 May 2014].     

[12] VESSWIC (2013), “Webinar: Impending Disaster, the Destruction of Aceh”WALCI Aceh [accessed 18 May 2014].

[14] BOS Canada (2013) “For the Protection of wild and rehabilitant orangutans & their native habitat”, News 2013 [accessed on 18 May 2014].

[16] BOS Canada (2013) “For the Protection of wild and rehabilitant orangutans & their native habitat”, News 2013 [accessed on 18 May 2014].

[17]endoftheicons (2012), “PT. Kallista Alam suing Aceh Government in regard to revoking permitendoftheicons, 30 November [accessed on 18 May 2014].

[18]endoftheicons (2012), “PT. Kallista Alam suing Aceh Government in regard to revoking permitendoftheicons, 30 November [accessed on 18 May 2014].

[19]Ibid.

[21]endoftheicons (2013), “WALHI Aceh Welcomes the Decision of the Administrative Courtendoftheicons, 11 January [accessed on 18 May 2014].

[22] BOS Canada (2013) “For the Protection of wild and rehabilitant orangutans & their native habitat”, News 2013 [accessed on 18 May 2014].

[23]endoftheicons (2012), “State Attorney Lawyers File the Legal Case of Tripa Peat Swamp This Weekendoftheicons, 8 November [accessed on 18 May 2014].

[25]endoftheicons (2012), “District Court of Meulaboh delay Kallista hearing for the second timeendoftheicons, 14 December [accessed on 18 May 2014].

[26]endoftheicons (2013), “KLH : No Settlement of the Case Without Compensationendoftheicons, 1 February [accessed on 18 May 2014].

[27]endoftheicons (2013), “Peat Fires Within PT. Kalista Alam Caused Through Human Actendoftheicons, 8 July; (2013), “Flood in Tripa Caused By Damaged Peat Function”endoftheicons, 8 July [accessed on 18 May 2014].

[28]endoftheicons (2013), “Students Urge Court to Withdraw PT Kalista Alam’s Permitendoftheicons, 15 July [accessed on 18 May 2014].

[29]endoftheicons (2013),  “Rogue Palm Oil Company, Fearing Negative Ruling, Initiates Conflict with Indonesian Courtendoftheicons, 15 November [accessed on 18 May 2014].

[30]Ibid.

[32]endoftheicons (2014), “In precedent-setting case, palm oil company fined $30M for destroying orangutan forestendoftheicons, 10 January [accessed on 18 April 2014].

[33] Gartland, A. (2014), “Palm Oil Company Fined Millions For Burning Sumatran Forest”Environment News Service [accessed on 19 Mary 2014].

[34]endoftheicons (2014), “In precedent-setting case, palm oil company fined $30M for destroying orangutan forestendoftheicons, 10 January [accessed on 18 April 2014].

[35] Satriastanti, F.E. (2014) “Sustainability: Aceh peatland ruling only first step in restoring corporate damage”, Thomas Reuters, 23 January, [accessed on 19 May 2014]; endoftheicons (2014), “Palm oil company fined US$30m for clearing 1,000 hectares in Indonesiaendoftheicons, 10 January [accessed on 19 May 2014].

[36] Thomas Reuters Sustainability (2014), “Aceh’s peatland ruling only first step in restoring corporate damage”, [accessed on 19 May 2014].

[38] Ibid.; endoftheicons (2014), “Petition updates: URGENT SUPPORT NEEDED TO SAVE THE ORANGUTANS OF THE LEUSER ECOSYSTEM!”, endoftheicons, 11 April [accessed on 19 May 2014].


Donna Clifford-Jones is a volunteer writer for the Orang Utan Republik Foundation. Donna obtained a law degree in Australia and is currently a student at the University of Oklahoma. 

     
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