Principles & Criteria of Legality for Forestry Operations & Wood Processing in Indonesia

Auditors Guidance Notes[1]

 

Principle 1.            Land Tenure and Use Rights and Responsibilities

 

1.1.1     Guidance: 

Step 1:  With a view toward finding out whether the area at is and is not in the permanent state forest landzone, determine whether or not there is a current ‘berita acara tata batas’ signed by the authorized delineation committee regarding land status.

Note 1: An authorized delineation committee is specified in SK Menhut 32, 2001 regarding the forest delineation process.  

Note 2:  Step 1 above should only have been followed by any demarcation activities carried out after February 2001, or by any forest gazettement which failed to demarcate the boundaries prior to that date. [not clear!]

 

Step 2:  Ensure that any community area physically located within the boundaries of the HPH area, HTI or Perum Perhutani area is defined as an enclave and excluded from any production forestry activities (Juklak and Juknis Dirjen Intag No. 724/A/VII-2, 1994).

Note 1:  Forest zones demarcated between 1974 and 1990 should follow the provisions of SK DirJen Kehutanan 85/Kpts/DJ/1/1974.

Note 2:  Forest zones demarcated between 1990 and 1996 should follow the provisions of SK Menhut 399, 1990 and SK Menhut 400, 1990.

Note 3:  Forest zones demarcated between 1997 and February, 2001 should follow the provisions of SK Menhut 399, 1990, SK Menhut 400, 1990, SK Menhut 634, 1996 and SK Menhut 635 1996.

Note 4:  Crosscheck the status of the proposed forest land in the village land book and district land book in the district office of the Badan Pertanahan Nasional (BPN).

 

1.1.2     Guidance:

Appropriate Applicable regulations are:

 

SK Mentan 178/Kpts/Um/4/1975 Pedoman Umum Perubahan Batas Kawasan Hutan , 23 April 1975 – 23 Oktober 1980

 

SK Mentan 764/Kpts/Um/10/1980,  Ketentuan Pelepasan Areal Hutan untuk Tujuan Perkrbunan, Peternakan, Perikanan dan Tanaman Pangan - 23 Oktober 1980

 

SK Dirjen Kehutanan 54/Kpts/DJ/I/1981, Tata Cara Pelepasan Areal Hutan untuk Tujuan Pekebunan, Peretnakan, Perikanan dan Tanaman Pangan 23 Maret 1981

 

SK Dirjen Kehutanan 53/Kpts/DJ/I/1981, Penetapan Wilayah-Wilayah Propinsi yang areal Hutannya tidak dapat dilepaskan untuk tujuan Perkebunan, Peternakan, Perikanan & Tanaman Pangan

 

SK Menhut KB.550/246/Kpts/4/1984 Pengaturan Penyediaan Lahan Kawasan Hutan untuk Pengembangan Usaha Budi Daya Pertanian

 

Surat Edaran Menhutbun no-VIII/2000 Penhentian/penagguhn pelepasan kawasan hutan, 22 Mei 2000

 

SK Menhut 70, 2001 Perubahan Status & Fungsi Kawasan Hutan , 21 April 2001

 

SK 48, 2004. Perubahan SK Menteri Kehutanan No 70/2001,Januari 2004

 

 

1.2.1     License is approved by the Ministry of Forestry for Guidance: License number, validity dates, license is signed. Free and prior informed consent means that affected communities must have been given full information on all activities to be undertaken and consequences deriving there for before they givegave their consent to such activities (UU 23, 1997 on Environmental Management; RUU Pemanfaatan dan Pelestarian Sumber Daya Genetik).  An affected community is one whose land claims overlap with the forest management unit and/or whose livelihood system is positively or negatively altered by the activities of the forest management unit (UU 23, 1997 and PP 27, 1999).

 

1.2.2                 Guidance: License number, validity dates, license [2] is signed by Dinas and Ministry of Forestry. Natural forest timber felled through land clearing activities to create industrial timber or agricultural plantations must have SK HTI or SK Kebun granted by national forestry authorities prior to the declaration of the June, 2000 land clearing moratorium, as well as an SK IPK granted by provincial forestry authorities. Natural forest timber felled using licenses from district authorities may only come from districts which have written permission to issue such licenses from provincial forestry authorities, and only in the event that such land clearing activities take place outside the national forest estate.

 

1.2.3     Guidance: Map with clear boundaries, cross checked with Provincial Land Use Planning Office. Using as base maps the Peta Penunjukan Kawasan Hutan dan Perairan Propinsi, or if that is not available, the most recent provincially sanctioned RTRWP, plot the RKT map (in the case of a HPH), Peta Rencana Pembukaan Lahan (in the case of nationally sanctioned land clearing activities), or Peta Bagan Kerja dan Rencana Pembukaan Lahan or its equivalent (in the case of provincially sanctioned/district approved land clearing permits).  Interpret the resulting map overlay to ensure that, for HPH and industrial timber plantations, cutting blocks do not overlap with areas designated as hutan lindung or kawasan konservasi.  Ensure also that nationally approved agricultural plantations and provincially sanctioned/district licensed land clearing permits do not overlap with any part of the national forest estate.  In instances where unauthorized intrusion into prohibited forest areas is thought to have occurred, take GPS readings to find out whether this is the case.

 

Evidence that the forest management unit has been gazetted (according to UU 24, 1992) in consultation with adat and local communities (for example, by participatory community mapping) with prior informed consent verified through a transcript of a dialogue with the communities).

 

For HPH (IUPHHK pada HA) and HTI (IUPHHK pada HT) and Perum Perhutani areas in particular, clear boundaries have been established  between the forest management unit and the territory of local and adat communities with the consent of all related parties (eg, relevant government authorities and affected communities).

 

Steps for gazettal:

Step 1:  With a view toward finding out what are the functional categories (kawasan konservasi, hutan lindung, hutan produksi terbatas, hutan produksi, hutan konversi), determine whether there is a current official notification of boundary delineation (berita acara tata batas) signed by the authorized delineation committee (SK Menhut 57, Kpts-II 1994).

Step 2:  With a view toward finding out whether the boundaries of a concession have been fully established, determine whether or not there is a current berita acara tata batas (according to the SK-HPH or its equivalent under new regulation, SK-HTI or its equivalent under new regulation) signed by the authorized delineation committee (Dir.Jen. BPK). 

Step 3:  Ensure that there is no hutan adat (regulated by UU 41, 1999 or PerMenBPN 5, 1999) or ijin hutan kemasyarakatan (SK Menhut 31, 2001) located inside or overlapping with the working area of the forest management unit.

Step 4:  For Perum Perhutani areas, no wood may be taken from land which is former ERFACHT and/or partikulir land (UU 1, 1958) and/or conservation areas (SK Menhut 251, 1985).

 

 

 

 

 

 

1.2.11.3.1          Guidance: Approved and valid  20- year, 5- year plans (Ministry of Forestry) and annual plans (Provincial Forestry Office).  AAC clearly defined within a net production area.  Conservation areas are delineated on maps for all management plans appropriate to scale.  Social areas adequately identified including any agricultural areas or culturally sensitive areas (see 1.1.3)

 

1.3.2                      Guidance: (ILS) IPK License, validity dates, license and work plan is approved by the government authority: provincial or district as outlined in Criterion 1.2).

 

 

 

Principle 2.    Physical and Social Environmental Impact

 

2.1.1     Guidance: AMDAL is signed and valid, key components of AMDAL to address social and physical environmental impacts, including; impact on customary land claims, protected areas have been prepared and correspond with the site

2.1.2     Guidance: RPL has clear plan to mitigate environmental impacts and provide social benefits.  Review Reports on the monitoring of the impacts according to the RPL and review reports and field visit to review procedures in place as recommended in the RKL to mitigate environmental impacts

 

2.2.1          Guidance: List of endangered species within the AMDAL.  Correct application of AMDAL procedures to develop the list of endangered species.  Cross-checking with other information about endangered species independent of AMDAL especially the official Ministry of Forestry list of endangered species.  Procedures for identification and protection of endangered species.  Evidence of actions take to prevent illegal hunting or trapping by local communities, workers /  contractors.  Procedures to control access to the forest and provide for security. Evidence to demonstrate implementation of procedures: patrols, guardposts, logbooks, reports. 

 

2.2.2          Guidance: Evidence of trading of CITES-listed species by local communities or workers / contractors.  Evidence of captured animals (RTE) in villages.  Recognition of indigenous legal systems and encouragement of continued customary use consistent with the Convention on Biological Diversity (see 1.2.2).[3]

 

Principle 3.    Community Relations and Workers Rights

 

3.1.1          Guidance:  Documents of above.

 

3.1.2     Guidance:  Documents of above.

 

Note:  The concept of free and prior informed consent is part of the Indonesian legal framework and can be found inter alia within the following laws:  National Environmental Law, Vulnerable Families and Populations Law, UU 41, 1999, Official Indonesian Ratification of the Convention on Biodiversity (CBD), Indonesian ratification of the International Human Rights Law. 

 

3.1.1          Guidance:  Evidence that company has conducted a social assessment and has compiled a list of local communities and their traditional rights.  Documentation of extensive consultation with communities. 

 

3.1.2          Guidance:  Management plans.  Evidence that community input was included in management plan.  Provisions should address collection of non-timber forest products, co-management and benefit sharing, if relevant (PP 34 2002 and SK 4795 2002).  Cross-check management planning process with sample of communities.

 

3.2.1     Guidance:  Company has formal defined agreements with local communities regarding community development (Bina Desa regulations[4]).  Cross-check with beneficiary communities on implementation.

 

3.2.2     Guidance:  Company has clear list of obligations to local communities (Government Regulation No.27 of 1999 in reference to AMDAL process). Inclusion of such obligations within the AMDAL.  Cross-check with beneficiary communities.

 

               

3.3.1     Guidance: Workers are not prevented from joining unions or union members are not discriminated against in employment decisions.

 

3.3.2     Guidance: Formal agreements with unions, Records of union meetings and management meetings.

 

3.4.1     Guidance: All salaries must be equal to or higher than the regional minimum wage. No worker puts in more than 40 hours a week, plus 12 hours overtime.  Each worker is given 12 days off per year in addition to national holidays. Evidence that salaries have been paid on time and in kind benefits actually provided.

3.4.2     Guidance: Company has documented procedures on safety that are implemented, including, work instructions (Standard Operating Procedures), proper use of safety equipment, training of staff in its use.  Records of accidents are evident as record that and safety performance is regularly reviewed to identify needs for improvement.

 

3.4.3     Guidance: Company has safety equipment for workers that are actually used.  Emergency first aid is available on site.  Evidence that workers are trained in basic first aid.

 

3.4.4     Guidance: Company to provide complete records of all staff that include employee number, registration of date of birth by identity card or birth certificate.

 

3.4.5          Guidance: Workers from a range of work classifications, are interviewed to ensure that regulations are followed.

 

Principle 4.    Timber Harvesting Laws and Regulations

 

4.1.1     Guidance: Company has geo-corrected maps of the annual working area that clearly show the boundary at an appropriate scale (1:10,000).  Harvest plans are approved by the provincial or district government as appropriate.

 

4.1.2     Guidance: Harvest plan (RKT (ILS) IPK) has clearly delineated areas set aside for protection with GPS coordinates where applicable for ease of identification in the field. 

 

4.2.1     Guidance: TPTI harvesting system requires (use the Reduced Impact Logging Guidelines for Indonesia for guidance purposes): 

§         Tree identification and tagging with tree numbers of all harvested trees with tags, species, petak number, DBH and estimated bole length.  Potential Crop Trees (PCTs) above 20 cm are also identified with tags and mapped. 

§         Protected trees are marked with yellow tags. 

§         Permanent sample plots (PUP) established

§         Buffer zones for roads and watercourses

§         No slopes over 40% to be harvested

§         No logging in Protected Areas, buffer zones, steep areas above 40%, or cultural sites

§         ILS areas also require boundary to be demarcated along with any Protection/Conservation Areas.  (SK Menhut 162, 2003).

 

4.2.2     Guidance: Boundary is cleared with 1-meter brush cutting and trees are clearly painted along the boundary.

 

4.2.3     Guidance: All equipment to be registered with the BPK.

 

4.2.4     Guidance: All trees harvested (as listed in the LHC) are identified with tags that contain the tree number, log letter, petak no., diameter, length, species and registered in a BU.   

 

4.2.5          Guidance: Check areas on harvesting plan with actual field situation.

 

 

Principle  5.   Forest Taxes

 

5.1.1          Guidance: receipts of payments for fees and timber extracted are current for the year.  Cross-check with a sample of harvesting records.

5.1.2     Guidance: receipts of payments for fees are current for the year.  Cross-check with a sample of harvesting records.

 

 

Principle 6.            Log Identification, Transfer and Delivery

 

6.1.1          Guidance: All logs have tags and paint/chisel markings that are legible. 

 

6.1.2          Guidance: All logs at log pond have a legible hammer mark.

 

6.2.1          Guidance:  Check sample of logs against documentation. This criterion only applies if the TPk is located within the boundaries of the forest management unit.  If not, go to Criterion 6.1.2.  

 

6.2.2     Guidance:  Check SKSHH has been issued inside the boundary of the FMU. Check sample of logs in each transport node against documentation, according to technical guidelines outlined in separate standardized audit procedures.

 

6.2.3     Guidance:  formal letter from the provincial government exempting the company from using authorised forms.  Internal delivery note (Faktur) during the interim should be cited.

 

6.2.4     Guidance:  check sample of logs against documentation.

 

6.3.1     Guidance:  valid (year and vehicle type, load capacity) registration License, and documentation stating it is a company owned /contractor vessel or truck to be inspected.

 

6.3.2     Guidance:  valid License (year and vehicle type, load capacity), and documentation stating it is a company owned /contractor vessel or truck available at office and inspected.

 

6.3.3          Guidance:  valid (year and quantity ) license with registration number and details of transportation protocols to be inspected.

 

 

 

 

 

Principle 7.            Timber Processing, Sales and Shipping

 

7.1.1     Guidance:  current operating license available on site for inspection.

 

7.1.2     Guidance:  current plan available on site for inspection and should be reviewed to ensure legal sources of wood are identified.  Installed capacity and annual output of the processing facility shall not exceed more than 30% of the licensed capacity for any category of processed timber.

 

7.1.3          Guidance:  current ETPIK with current registration number to be inspected.

 

7.1.4          Guidance:  Audited logs must match their description in the DHH attachment to the SKSHH on file in the log pond or log yard.  In particular, alphanumeric codes of each sample log must match exactly the code found in the DHH.  If the log originates from a HPH, it must also match the way it is described in the DHH in terms of species, diameter (within 5 cm of error), and length (within 10 cm of error).

 

7.1.5          Guidance: current for documentation.

 

7.2.1     Guidance: Registration documents to be inspected for validity (signed by MoT and current) plus that they relate to the actual company and vessel.



[1] These are designed to give clarification to, and to be read in conjunction with, the corresponding draft of “Principles & Criteria of Legality for Forestry Operations & Wood Processing in Indonesia

[2] IPKs not permitted by Ministry of Forestry after 2000

Ministerial Decree No. 691/KPTS-II/91HPH Bina Desa Hutan (Community Development in Timber Concessions)

[3] Convention on Biological Diversity Article 10(c) obliges States, “as far as possible and as appropriate” to “protect and encourage customary use of biological resources in accordance with traditional cultural practices that are compatible with conservation or sustainable use requirements.”

[4] Ministerial Decree No. 691/KPTS-II/91HPH Bina Desa Hutan (Community Development in Timber Concessions)