Papuan government “exercises its discretion” to encourage palm oil company to break the law

Tuesday, May 30th, 2017

The company at the heart of a controversial palm oil development in Papua claimed that the provincial and district governments encouraged it to commit what amounts to a criminal offence because they were “impatient” to see the project begin.

PT Nabire Baru, a subsidiary of Goodhope Asia Holdings, began operating in 2011 without an approved Environmental Impact Assessment, known by its Indonesian acronym AMDAL. Failure to comply with this legal requirement attracts criminal sanctions, including jail time and substantial fines.

In a written response to a range of allegations Goodhope admitted that it had begun land clearing before the AMDAL was approved, but claimed it was pressured by the government to do so and that it had “no option but to commence its operations at minimum levels to satisfy the demands from the government and community”.

Goodhope explains that the government officials were at pains to get the development moving because it was “the only means for social development in the area due to the lack of any other viable socio-economic potentials [sic]”. This contrasts with the view presented by NGOs who raised the grievance against the company, who have argued that the company destroyed communities’ sago palms, thereby harming their food security.

Goodhope also wrote that the government agencies were “mutually in agreement” that the decision was “not in line with the legal requirements in Indonesia”. But it was “deemed as not violating the law as the government exercised its discretion” to issue permits.

Goodhope’s explanation for its violation of the Environmental Act was included in a series of lengthy documents made public on 2nd December 2016, responding to complaints lodged against the company with the Roundtable on Sustainable Palm Oil (RSPO). On 1st December 2016 IDM published a post on the inability of the RSPO to grapple properly with violations of the law, which highlighted the apparent inaction over PT Nabire Baru.

Last month a coalition of NGOs carried out an extensive and scathing analysis of the assessments carried out on behalf of PT Nabire Baru that were intended to demonstrate its compliance with the RSPO standard. The NGOs found, among other things, that High Conservation Value (HCV) assessments were “of poor quality or deliberately false”.

The NGO assessment also argued that Goodhope’s operations amounted to “laundering illegally developed land into the certification process”.

On 28th April the RSPO imposed a “stop work order” on seven of Goodhope’s plantations. The RSPO Complaints Panel concurred that the HCV assessments were inadequate and needed to be re-done. However it made no comment on the legal issues.


Image on homepage shows location of PT Nabire Baru, courtesy of the West Papua Palm Oil Atlas