MAC: Mines and Communities

Indonesia's Constitutional Court Upholds Mining Law

Published by MAC on 2005-07-07

Indonesia's Constitutional Court Upholds Mining Law

Thursday July 7 2005

Dow Jones Newswires

JAKARTA - Indonesia's Constitutional Court voted Thursday to uphold a law that has enabled 13 mining companies to operate in officially designated "protected forest" areas.

"We decided to uphold the law as it isn't against the 1945 Constitution," said presiding Judge Jimly Asshiddiqie.

Jimly said the decision was also taken on the basis that the government must honor contracts of companies that have already obtained licenses to operate in the areas.

He said overturning the law could result in legal uncertainty in Indonesia.

Analysts say the ruling is positive news for the local operations of foreign mining giants Freeport-McMoRan Copper & Gold Inc. (FCX) and Inco. Ltd. (N), as well as Indonesia's PT Aneka Tambang (ANTM.JK).

The Constitutional Court's review was prompted by appeals from eleven non-government environmental organizations and 82 individuals. The court agreed to review the case in January and began hearings in February.

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