Legal Notice from Yohs. Irianto Horong, LLB, dated April 27, 2023, May 17, 2023, and May 22, 2023.
- Delay in the development of plasma plantations at PT Dongin Prabhawa.
- Realization of CSR programs.
- Demand for 30% profit sharing or at least IDR 17,000,000,000 every month from CPO and palm kernel sales as well as immediate distribution of 20% of the total planted area to plasma plantation.
- On May 22, 2023, TSE Group’s ESG Division formed an investigation team and conducts further investigations regarding the complaint filed. The chronology of the incident based on the results of the investigation is as follows:
| April 25: | A lawyer named Yohs. Irianto Horong, LLB, alias Rudi Horong, who unilaterally claimed to have a power of attorney from 17 clans of customary rights owners in the concession of PT Dongin Prabhawa (PT DP), came to the office of PT DP and asked for a meeting. PT DP proposed to have the meeting the next day, with representatives of TSE Group, the parent company of PT DP, involved. | |
| April 26: | The meeting between company representatives and Rudi Horong was held at PT DP. The company had clearly indicated its willingness to answer questions in good faith.
The company then asked Rudi Horong to provide some supporting documents, including the power of attorney from 17 clans with customary rights to the land and a formal letter of inquiry. However, at that time, Rudi Horong could not show any documents. Then at 3 p.m. (Eastern Indonesia Time), Rudi Horong and four clan members blocked the entrance to PT DP’s CPO mill, which stopped the operations of the mill and the plantation. |
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| April 27: | A negotiation was held at Norbetus Walinaulik’s house, attended by representatives of PT DP and some clan members. | |
| April 28: | The company received Legal Notice I from Rudi Horong without the previously requested power of attorney attached. | |
| April 28 – 30: | A negotiation was held in the meeting room of PT DP’s CPO mill. | |
| May 1 – 5: | The negotiation continued with the mediation of the police. | |
| May 6: | Due to the blockage, which lasted from April 26 to May 6, operations of the CPO mill and plantation were halted. During this period, clan members who participated in the blocking and the company met several times and discussed plasma plantation developments and the implementation of PT DP’s Corporate Social Contributions (CSC) program.
Eventually, in the afternoon of this day, an agreement was reached between the company and the clan members to lift the blockage, and the clan members voluntarily acted on the agreement. The company also proposed to the clan members to hold a meeting on May 10 by inviting representatives of all 17 clans to explain the progress of plasma plantation developments and implementation of CSC. This is because the plasma plantation development rights are jointly owned by the 17 clans. It was not until this day that Rudi Horong showed the power of attorney with signatures by 13 clans to the company. |
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| May 10: | Representatives of 17 clans and the company met in PT DP’s meeting room. The representatives stated that no one should use the names of the 17 clans to block the CPO mill in the future and it should not interrupt the company’s operations.
Although the previous blockage action could not be justified, the company provided financial assistance of IDR 150,000,000 (One Hundred Fifty Million Rupiah) as an appreciation for the good faith and commitment shown by the 17 clan representatives. |
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| May 17: | Legal Notice II from Rudi Horong was received. | |
| May 22: | Legal Notice III from Rudi Horong was received. | |
| May 23: | PT DP has responded to the three Legal Notices sent by Rudi Horong, which are as follows:
“In the Power of Attorney submitted on May 6, it is known and explained that Rudi Horong specifically represents 17 (seventeen) clans to resolve customary land issues between the indigenous community and PT Bio Inti Agrindo.” “PT Dongin Prabhawa has no legal affiliation with PT Bio Inti Agrindo, and there is a lack of clarification and legal relevancy between the Legal Notices and the Power of Attorney.” |
- Based on the issues, the following is the clarification of PT Dongin Prabhawa’s (DP) progress of plasma plantation development
1. Commitment to plasma development
The development of Plasma Plantation through Iska Bekai Cooperative, which was established in 2016 as PT DP’s plasma plantation cooperative, is a responsibility mandated by laws and regulations in Indonesia. Therefore, PT DP has the commitment to carry it out while taking into account the environmental and social aspects of the local community.
PT DP has demonstrated its commitment to plasma development by allocating 20% of the Right to Cultivate (HGU) area to the Iska Bekai Cooperative. Currently, the HGU transfer process has been completed with the issuance of HGU Transfer Permit to Iska Bekai Cooperative from the Minister of Agrarian Affairs and Spatial Planning/National Land Agency (ATR/BPN) on June 26, 2023. This shows that PT DP has never had any intention to delay or deliberately did not develop plasma plantations. The development of plasma plantations is also part of PT DP’s commitment as published through the ESG Commitments on the TSE Group Website (https://www.tse.co.id/sustainability/policies/).
TSE Group’s ESG Commitments include receiving and handling complaints from stakeholders accountably, as well as involving independent third parties when necessary.
2. Actions/ steps that have been taken
The process of establishing PT DP’s plasma cooperative named Iska Bekai began in 2014, starting with the dissemination of information on palm oil cultivation techniques, cooperative organization, and the partnerships between the company and the community in each village.
Since the beginning, determining the location of plasma plantations has been a difficult issue, thus requiring a long time to resolve. Communities with customary rights had not yet agreed on the location of the plasma plantation since it was related to land rights and ownership of customary rights of each clan.
On the other hand, PT DP wanted the development of plasma plantations to be carried out simultaneously with the development of nucleus plantations. Therefore, PT DP consistently encouraged customary rights owners to make an agreement on the location of plasma, funding plans, and the establishment of a business entity/cooperative to operate the plasma plantation. However, due to the delay in making agreements among the communities, PT DP took the initiative to support the establishment of Iska Bekai Cooperative as a plasma operator and handed over 20% of the HGU of PT DP to become HGU of Iska Bekai Cooperative.
Finally, in 2016, the Iska Bekai Cooperative was formally established based on the Cooperative’s Deed of Establishment No. 13 dated February 13, 2016, by Notary Rini Widayanti, SH, M.Kn with 282 household members, who are part of 17 clans of customary rights owners in the PT DP area. The establishment of the Iska Bekai Cooperative was ultimately to provide an organizational foundation to realize the community’s desire to have its palm oil plantation.
Nevertheless, due to the government’s moratorium policy and negative campaigns, as well as pressure from international NGOs through deforestation issues, PT DP decided to conduct a Stop Work Order (SWO) in November 2016 until all HCV & HCS assessments by an independent consultant were completed.
Throughout the SWO, PT DP has continuously tried to solve the aforementioned issues by making several efforts, which included working with competent third parties since 2017 (LINKS, BIOREF IPB, USAID LESTARI, TFT, and AZ Law) to conduct gap analysis, decide the location of plasma plantations, or find alternative solutions to the plasma plantation. In addition, PT DP initiated meetings and consultations with various stakeholders to hear suggestions and inputs, so that the development of plasma plantations can be carried out.
Annual member meetings in the Iska Bekai Cooperative have been held every year to find solutions for developing plasma plantations. PT DP has also implemented Corporate Social Contributions (CSC) programs for the communities of 17 clans every year.
On January 30, 2023, an extraordinary member meeting of Iska Bekai Cooperative was held, which was attended by the management, supervisors, and members to discuss the acceleration of plasma plantation development. Moreover, the Iska Bekai Cooperative decided to develop plasma plantations on its own with the assistance of agricultural experts.
On February 14, 2023, a stakeholder meeting was held between the Iska Bekai Cooperative, the Merauke Regency Government, and related stakeholders to discuss the plasma plantation development. At this meeting, the cooperative expressed its intention to develop and manage oil palm plantations independently from PT DP from 2023. The Merauke Regency Government supports the cooperative’s wishes by assigning a team of experts for the plasma cooperative. Currently, PT DP is in the final stage of handing over plasma HGU of the plasma plantation to the cooperative per the cooperative’s request and the instruction of the Merauke Regency Government.
3. The chronology of Iska Bekai Cooperative’s plasma plantation management
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| 2023 |
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- PT Dongin Prabhawa’s (DP) CSC Commitments
TSE Group has been actively engaged in sustainable community development in various fields since 1998 (in Papua) and 2012 (in Maluku) through the Corporate Social Contribution (CSC). It has done so in accordance with its philosophy to build a harmonious, beneficial, and sustainable relationship with the local people and other stakeholders for shared improvement and prosperity. Through CSC, TSE focuses on creating strategic, systematic, and sustainable programs that cater to five major issues in society or what the company calls “pillars”; these are education, health, economy, environment, and infrastructure.
In 2022, PT DP allocated IDR 5 billion for CSC, distributing it across all “pillar” programs. Education-oriented programs, in particular, received IDR 2 billion. These initiatives included the provision of dormitory accommodation for 10 students from communities in the PT DP area who attend high school in Merauke and financial assistance for 43 teachers in 7 local schools. In addition to educational support, the company has contributed IDR 3 billion to infrastructure development, which encompassed various public projects. Among these were dug well construction for clean water access in two villages (1 well for each village), generators, building material delivery, and relocation assistance for flood-affected households. Over the past five years, IDR 20 billion in total has been disbursed for CSC activities of various kinds.
PT DP’s health clinic is also readily accessible to nearby communities, providing essential medical services without charge. This clinic has made a major contribution to the overall health condition of the local people. To support the clinic and cover expenses in the last five years, PT DP invested approximately IDR 11 billion and in 2022 alone spent IDR 2.5 billion.
On April 20, 2021, PT DP had a meeting with representatives of 17 indigenous clans that resulted in a joint agreement which, among others, discussed and designed CSC programs for 2022. The objective was to involve all the clans in the program planning process by using a participatory approach and have the programs focus on community economic empowerment. The community was allowed to engage in PT DP’s visits and discussion sessions, where they could share their needs and aspirations. Outcomes of these discussions were subsequently communicated in two evaluation meetings on March 30, 2023 and June 27, 2023, in which PT DP presented the implementation of the agreement between the company and the 17 clans and its progress.
- The complainant is entangled in suspected fraudulent activity attributed to PT Elora Papua Abadi, a company where he is a commissioner (https://papua.tribunnews.com/2023/06/10/pasutri-di-merauke-tipu-300-warga-dengan-modus-bisnis-properti-uang-rp-10-miliar-raib-ini-sosoknya). As the complainant cannot carry out his role as a legal representative, we have concluded that this case is closed.
Following the agreements made between the local community and PT DP in 2021 and 2022, we actively take into consideration the complaints and recommendations from the community and regularly evaluate improvements made in the case through committee (Tim Kecil) meetings every three months.