Parliament Passes Key Amendments to Mining Law, Expanding Domestic and SME Participation

JAKARTA, investortrust.id - The House of Representatives, or DPR, has officially passed the Fourth Amendment to Law No. 4 of 2009 on Mineral and Coal Mining into law during a plenary session at the parliamentary complex in Jakarta on Tuesday, Feb. 18, 2025.

The revised law introduces 13 key amendments, including prioritizing domestic supply obligations for mining companies, expanding the participation of state-owned enterprises (BUMN), regional enterprises (BUMD), small and medium enterprises (SMEs), cooperatives, and religious organizations in mining activities.

It also mandates environmental audits for permit extensions, strengthens social responsibility programs for mining communities, and allows the government to revoke overlapping mining permits. Additionally, religious organizations can now manage mining areas beyond former concession zones.

Adies Kadir, a deputy speaker of the House,  led the plenary session, attended by Minister of Energy and Mineral Resources Bahlil Lahadalia, Minister of Law and Human Rights Supratman Andi Agtas, Minister of State Secretary Prasetyo Hadi, and Deputy Chair of the Legislative Body (Baleg) Ahmad Doli.

During the plenary session, the bill was subsequently passed with the support of 311 out of 579 DPR members present, representing all parliamentary factions. 

Deputy Chair of Baleg Ahmad Doli stated that the deliberation of the bill had involved discussions on 256 points of issue (DIM) with the government and the Regional Representative Council (DPD). On Feb. 17, 2025, Baleg conducted a working meeting with the government and Committee II of the DPD to finalize the bill before it was presented for a vote in the plenary session.

Minister Bahlil emphasized that the amendments align with the government’s goals of ensuring fairness and economic welfare in the mining sector. He noted that Indonesia’s vast mineral and coal resources require sustainable management to support economic growth and industrial development.

"Indonesia possesses abundant natural resources, including minerals and coal, which require sustainable management to drive national economic development. This is crucial for achieving our long-term national goals of justice and prosperity," Bahlil stated during the plenary session.

He further highlighted that natural resources should serve as economic drivers, accelerating downstream industrialization and resource-based manufacturing.

"This amendment aligns with the government's Asta Cita priorities, which focus on strengthening national security, fostering self-sufficiency in food, energy, and water, and advancing creative, green, and blue economies," he added.

A key provision in the new law expands opportunities for religious organizations to participate in mining activities beyond previously designated areas.  Under the previous regulation—Government Regulation (PP) No. 25 of 2024, which amended PP No. 96 of 2021—religious organizations were limited to managing only six former coal mining areas.

"With this law, religious organizations are no longer restricted to former PKP2B mining areas. This provision expands their opportunities to participate in mining operations," Bahlil explained.

Bahlil argued this change recognizes their historical contributions to national development and enhances their role in managing natural resources.

Another critical amendment mandates mining companies with production operation permits (IUP and IUPK) to prioritize domestic supply before exporting. It also strengthens corporate social responsibility requirements, ensuring greater community involvement in mining activities.

Deputy Chair of Baleg Ahmad Doli detailed the legislative process, highlighting the thorough deliberations that took place from Feb. 11-17, 2025. He noted that the revised law also includes provisions ensuring state-owned enterprises have sufficient access to mineral resources for public services such as energy and infrastructure.

"This consensus reflects a shared commitment among lawmakers to improve governance in the mining sector while ensuring equitable access to resources," Doli concluded.