AreaIndonesia

Commodity GroupOilseeds, oils and meals

CommodityPalm oil

Date01/10/2014

Policy CategoryProduction

Policy InstrumentLand rights

DescriptionApproved plantation ownership regulation with aim to maximize land usage while ensuring adequate participation of smallholders in the plantation sector.

NotesThe government has approved comprehensive legislation regulating plantation ownership across the country. The new bill aims at maximizing land usage while ensuring adequate participation of smallholders in the plantation sector. All plantation firms are required to allocate 20% of their land to local farmers and to assist the latter in setting up their own plantations. Companies have been given five years to comply with the new rules. A controversial clause that would have drastically limited foreign ownership has been dropped from the final bill (see also MPPU Sep.’14). A law introduced last year to limit the size of new plantations to 100 000 hectares complements the bill (see MPPU Nov.’13).