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Mediating Mining Disputes in Indonesia: Exploring Alternative Conflict Resolution in the Industry

Mediating Mining Disputes in Indonesia: Exploring Alternative Conflict Resolution in the Industry

In Indonesia, mining is a big industry that gives foreign nations much access and licensing authority. On the other hand, increased mining activity raises the risk of extensive exploitation, pollution, and environmental harm. Indonesia has two types of natural resources: non-renewable and renewable. Mining is one of the main sources of both local and foreign exchange earnings. Three categories comprise Indonesia's mining classification: non-vital minerals, vital minerals, and excavated material. Conflicts might arise from mining operations because of the potential for environmental damage and social environmental dangers. Studies on the creation of regulations for the mining industry and alternative conflict resolution procedures, such as mediation, are required to solve these problems. The purpose of mining legislation is to reduce disputes between businesses and safeguard coal mining sector interests. There are two categories: special mining law, which concentrates on coal and mineral mining, and general mining law, which encompasses geothermal, oil, gas, mineral content, and groundwater. In mining, minerals or coal are investigated, managed, and exploited. This includes building, processing, refining, transportation, and sales. In addition, mining activities involving metallic, non-metallic, and radioactive materials are categorized by legislation. Determining the region serves as the foundation for mining management and operations.

Mining regions are regulated by Law No. 4 of 2009 on Mineral and Coal Mining, which is based on scientific standards and objective measurements. A tool that promotes the rule of law and gives legal certainty is permission. Mining operations are permitted in Indonesia under several different frameworks, such as company licenses and permits. Alternative dispute resolution (ADR), established institutions, and court-based settlement are some of the conflict resolution techniques. International law, domestic legislation, mining works contracts, coal mining concession works agreements, and mining power of attorney are some of the sources of conflict resolution. Conflict results from issues that are brought about by mining operations, such as general inquiry, exploration, and material exploitation. Legal clarity and authority will come from a consistent application of these regulations.

Expert perspectives on the definition of "dispute" vary; some define it as a public declaration regarding demands made against something valuable. Problems resulting from mining operations, such as exploration, investigation, and material exploitation, give rise to mining conflicts. These conflicts may be brought on by environmental contamination, labour disputes, community development initiatives, land rights issues, stock divestiture disputes, and noncompliance with government regulations. The regulation of mining company operations in connection to the resolution of mining disputes in Indonesia is examined in this paper using a normative juridical approach. The Indonesian counterpart of the Indische Mijnwet 1899 (IM 1899) is the Indonesian Government Regulation instead of Law (Perpu) number 37 of 1960. It enables the government to draw in outside funding for Indonesia's mining operations. The law creates the authority for mining operations and does away with the concession system. Mining is done by state-owned and local firms, and the company does business with private entities. Direct foreign firm participation in mining company operations is prohibited. Depending on the nature of the disagreement, arbitration or judicial proceedings may be used to resolve it.

ADR, or alternative dispute resolution, and arbitration are processes that offer another avenue for conflict resolution. ADR is informal and does not call for legal action or supporting paperwork. It is predicated on the ideas of likeness, direct engagement, and communication between parties to a dispute. Arbitration, mediation, conciliation, and negotiation are the four categories under which ADR mechanisms fall. It is suitable for conflicts originating from the legal relationships of the contract, including those involving mining operations that are governed by Law Number 11 Year 1967 on the Fundamental Provisions of Mining Contract Mining, Contract Work, PKP2B. However, as the country's administration now requires authorization to go via the State Administrative Court and arbitration procedures, the ADR mechanism is no longer applicable due to the enactment of Law Number 4 Year 2009 on Mineral and Coal Mining.

In indigenous communities, traditional institutions are utilized to settle conflicts, especially those resulting from the use of land for mining operations that affect the rights of indigenous peoples and their natural resources. When there are disputes between the mining industry and other industries like forestry, environmental protection, and spatial planning, this approach is frequently used. As a "win-win solution" that preserves secrecy, alternative dispute resolution, also known as alternative dispute resolution (APS) or alternative dispute resolution (ADR), is an alternative to courtroom litigation. The benefits of alternative dispute resolution (ADR) include cost savings, efficiency, and the option to select an arbitrator or mediator. ADR can only be successful if the parties are willing to put their differences behind them.

Different cultures and religions have acknowledged the idea of Alternative Dispute Resolution (ADR), including traditional Chinese society, Japan, and East Asian nations. ADR is a process that prioritizes the interests of all parties concerned and is tailored to the local legal culture. In the United States, ADR is now taught in economics and law schools, and the American Bar Association established a Committee on ADR inside its organization. In contrast, the East has a long-standing tradition of contemplation and accommodating efforts toward the interests of all parties, which forms the foundation of the ADR method. As stated in Article 33 paragraph (3) of the Constitution of the Republic of Indonesia in 1945, the creation of rules for commercial operations in the mining sector in Indonesia emphasizes the significance of considering alternative dispute resolution procedures when settling conflicts.

  • Mining conflicts in Indonesia stem from various issues, including environmental pollution, land rights disputes, and labor conflicts.
  • Traditional dispute resolution methods, especially in indigenous communities, play a significant role in resolving conflicts arising from mining activities.
  • ADR offers a promising avenue for resolving mining disputes efficiently and maintaining confidentiality, aligning with local legal cultures and international practices.

BY : Vaishnavi Rastogi

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