UPDATE 1-Indonesian mining group challenges ore export ban in court – by Fergus Jensen (Reuters India – January 22, 2014)


Jan 22 (Reuters) – Indonesia’s Mineral Entrepreneurs Association (APEMINDO) has filed a legal challenge against a ban on ore exports introduced less than two weeks ago.

President Susilo Bambang Yudhoyono signed off on the controversial ore export ban on Jan. 12, although last-minute amendments eased the impact of the export ban on mining giants Freeport McMoRan Copper & Gold and Newmont Mining Corp which are now subject to an export tax.

Indonesia is the world’s biggest exporter of nickel ore, refined tin and thermal coal and is an important producer of copper and gold. It is seeking to increase added value from its mineral wealth but has been widely criticised for the ore export ban, seen by many as unfeasible.

“If this policy is carried out it will kill mining businesses,” Revly Harun, a lawyer for APEMINDO, told Reuters on Wednesday. “If they want to make smelters they need money for that. We don’t think this ore export ban is realistic.”

“For several products, such as bauxite, there is no way they can be processed domestically because of limitations,” said Harun, adding that the legal challenge focuses on the domestic processing and purification of minerals.

Despite the changes to the mining export regulation, the new rules are seen hitting domestic nickel and bauxite miners hardest, and many have already begun shedding workers.

The APEMINDO challenge was filed to the Constitutional Court, Indonesia’s highest legal authority, on Jan. 16.

Mining law expert Bill Sullivan, foreign counsel at Christian Teo Purwono & Partners in Jakarta, expressed doubts over the outcome of the challenge.

“It would be a very brave man who gave any firm assessment of how this may play out,” he said, adding that other nickel and bauxite mining groups could also challenge the ban “on the basis of any number of arguments”.


Sullivan expects further legal challenges from other mining groups to follow.

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