Record fine against plantation company upheld

14 September 2015 General News

Hans Nicholas Jong, The Jakarta Post, Jakarta | Headlines | Sun, September 13 2015

Original article

The Supreme Court has rejected an appeal by palm oil company PT Kallista Alam and ordered the company to pay fines totalling Rp 366 billion (US$25.6 million) for illegally burning large swathes of the Tripa forest in Aceh, a verdict that many hope could set a precedent for future law enforcement against agro-forestry companies.

The Environment and Forestry Ministry, which filed the lawsuit against PT Kallista Alam back in 2012, said the ruling was unprecedented, especially the size of the fine ordered in an environmental case. 

“As far as I know, nothing has been as big as this,” the ministry’s law enforcement director-general Rasio Ridho Sani, told The Jakarta Post. 

In early 2014, the Meulaboh District Court in Aceh found PT Kallista Alam guilty of burning around 1,000 hectares of the Tripa forest, which lies within Sumatra’s Leuser Ecosystem, the only place on Earth where tigers, elephants, rhinos and orangutans can be found living together in the wild.

The court ordered the company to pay Rp 114.3 billion in compensation and Rp 251.7 billion to restore the affected areas of forest.

The company then filed an unsuccessful appeal at the Banda Aceh District Court before finally submitting its appeal to the Supreme Court. 

The Supreme Court rejected the appeal on Aug. 28. 

“The verdict shows that judges certified with environmental licenses have a clear understanding of the impact of land and forest burning,” Rasio said. 

He expected the verdict could be used as a precedent for ongoing and future cases.

“We hope it becomes a reference for judges hearing cases in Palembang against PT Bumi Mekar Hijau and North Jakarta in the case of PT Jatim Jaya Perkasa,” said Rasio.

With regard to PT Jatim Jaya Perkasa, the ministry has filed a civil lawsuit at the North Jakarta District Court against the company, demanding Rp 119.88 billion in fines for damaging the environment and Rp 371.12 billion for the recovery of the area. 

In a bigger case, the ministry has also filed civil lawsuits with the Palembang District Court in South Sumatra against PT Bumi Mekar Hijau for allegedly causing fires in 20,000 hectares in Ogan Komering Ilir, South Sumatra. 

It has demanded the company pay a fine of Rp 2.6 trillion for damaging the environment and Rp 5.2 trillion for its recovery. Both trials are currently ongoing.

“It’s the biggest lawsuit we’ve ever filed,” Rasio said, adding that the lawsuit would reimburse the state Rp 7.8 trillion if it was successful. “So, I hope the judges handling these cases can learn from the Supreme Court’s verdict [on PT Kallista Alam].”

PT Bumi Mekar Hijau is a subsidiary of Asia Pulp and Paper. It has concessions amounting to 250,370 hectares in Ogan Komering Ilir. Based on data from the Indonesian Forum for the Environment (Walhi), most of the locations of fires in the province are on the company’s concessions.

The ministry has been actively suing plantation companies for causing forest fires since 2013. The companies use the slash-and-burn method to open up forest areas as it is so cheap. 

“We are preparing to file civil lawsuits against five other companies. Maybe next week we will do so,” Rasio said. 

The ministry is stepping up its legal actions against the companies as the haze caused by smoke continued to blanket much of Sumatra on Saturday.

Intensifying forest fires in Sumatra have paralyzed Sultan Syarif Kasim II Airport in the Riau provincial capital of Pekanbaru as the haze has reduced visibility in the city to only 100 meters, compared to the normal 10,000 meters. 

“No planes can fly,” said airport duty manager Hasnan in Pekanbaru on Saturday, adding that the airport runway was covered by ash.

Since Friday, the thick smoke from forest fires has shrouded Pekanbaru, after rain had fallen on the city earlier in the week. Hasnan said that 32 flights had been delayed on Friday.

The Pekanbaru station of the Meteorology, Climatology and Geophysics Agency (BMKG) reported that the Tera and Aqua satellites detected 883 hot spots in the Sumatra forests, indicating the spread of forest fires. This was substantially worse than the situation of the day before when 665 hot spots were recorded.

The National Disaster Mitigation Agency (BNPB) said on Saturday that the haze from Sumatra and Kalimantan had already spread to Singapore and parts of Sarawak in East Malaysia.

“Winds blowing north east caused haze from Riau, Jambi and South Sumatra to cover Singapore. The biggest source of the haze came from South Sumatra,” BNPS spokesman Sutopo Purwo Nugroho said. - See more at:

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