Conservation and Development Balance of the Palm Oil Industry Through Sustainability Regulation

Abstract

ISPO Certificate as provided under the Minister of Agriculture Regulation Number 19/Permentan/ OT.140/3/2011 it impose that not later than 2014 all ventures which had obtained Plantation Business Permit (IUP) shall obtained ISPO Certificate, the result is that at the end of 2014 there was only 5% (five percent) of the total IUP holders in compliance to the ISPO Certificate requirements. Following after, the Minister of Agriculture issued new regulation Regulation Number 11/Permentan/OT.140/3/2015 which stricken out some requirements under the previous regulation Regulation Number 19/Permentan/OT.140/ 3/2011, the new regulation require all ventures to only apply for ISPO Certificate. Then, in 2017, the Government announced that it will issue a bill on ISPO Certificate to refine its administration, but much to dismay it failed. Such government failure created dissatisfaction among international buyers because ISPO Certificate is only formality without any practical value, therefore international buyers prefer the RSPO to certified their CPO and CPO products in order to keep their price at premium. The problem is such RSPO Certificate as of 2018 require Land Use Certificate (HGU) and posed with many related technical licenses requirements for the growers (ventures) who applies for RSPO Certificate. Whilst, the RSPO focused more on conservation than on development. In this matter, Indonesian growers find it is difficult to obtain Land Use Certificate (HGU) and technical licenses requirements if the process is prolonged and expensive. Keywords-Sustainability, Governance, Regulation, Technical Licenses, ISPO Certificate