Indonesian state court failing to enforce $26 million Supreme Court palm oil fine

Thursday, November 30th, 2017

A state court in Indonesia is failing to enforce a Supreme Court ruling requiring a palm oil firm to pay US$26.5 million for illegal clearing with fire in the Tripa Peat Swamp, a vital orangutan habitat in the Leuser Ecosystem.

Indonesian forest rangers patrol part of PT KA's Tripa plantation. Photo by Dita Alangkara/CIFOR

In a 2014 case brought by the Ministry of Environment, PT Kallista Alam (PT KA) was ordered to pay US$18 million to restore 1,000 hectares of burnt land, alongside US$8.5 million in compensation to the state treasury. An appeal against the verdict was rejected by the Supreme Court in August 2015.

But two years since the Supreme Court’s ruling, the Meulaboh State Court has yet to collect the fines, despite the Ministry of Environment and Forestry submitting letters requesting they do so.

A demand from PT KA for a judicial review of the Supreme Court’s ruling was rejected in April 2017. Instead of accepting the verdict, PT KA filed a lawsuit against the case plaintiff, the Ministry of Environment and Forestry. The Meulaboh State Court has declared that the 2015 ruling cannot be executed until there is a verdict on the new lawsuit, infuriating local activists who have campaigned for the firm’s prosecution.

“No new lawsuit cases submitted by the company can justify the court postponing the verdict,” a spokesperson for the Aceh-based environmental movement GeRAM said at a press conference on 28 November. “It is baffling unless PT KA is seeking reasons to avoid paying the fines and the Meulaboh State Court is seeking reasons to postpone executing the verdict.”

PT KA’s unpaid fines are a fraction of more than US$1 billion in illegal deforestation penalties that the Indonesian government is failing to collect, hampering efforts to restore valuable peat and forest habitats.