Government welcomes tribunal ruling over coal dispute
Friday, December 9 2016 - 01:27 AM WIB
The government of Indonesia welcomes a ruling Wednesday by the International Centre for Settlement of Investment Dispute (ICSID), which granted Indonesia's application to dismiss claims filed by LSE-listed Churchill Mining Plc and its subsidiary Planet Mining Pty Ltd for damages arising out of the revocation of the mining licenses that made up the East Kutai Coal Project (EKCP) in East Kalimantan Province.
Minister of Law and Human Rights Yasonna Laoli said on Thursday that the ICSID tribunal ruling has freed the government from having to pay compensation worth US$1.3 billion to Churchill if Indonesia losses in the legal case. ?For quite sometimes, we?re worried, but we kept on fighting,? he said.
Yasonna said that the ICSID case should serve as valuable lesson for Indonesia including for regional governments to be careful in making policies so as to avoid legal dispute. He also warned investors to respect laws and regulations when making investment in Indonesia.
Churchill and its Australian subsidiary Planet Mining filed in 2014 a lawsuit with ICSID against the government of Indonesia, which has been accused by the company of unlawfully revoking its mining license over the East Kutai coal project, which is Churchill?s only asset. The UK firm has sought for about $1.3 billion in compensation. But the Indonesian government has accused Churchill of falsifying license documents of the East Kutai coal project.
ICSID said among others in its Wednesday ruling that thirty four disputed documents were held to be not authentic; the forger of the disputed documents was most likely a person or persons acting for or on behalf of Churchill's Indonesian partner the Ridlatama group in collusion with a person inside the East Kutai Regency; and ordered Churchill to pay a total of US$ 9,446,528 in costs and arbitration tribunal fees.
Churchill said it plans to file a request for annulment of the award.
Indonesia is currently facing another lawsuit filed by Indian Metal and Ferro Alloys Limited (IMFA) in September of last year against the Indonesian government with an arbitration court in The Hague after the company failed to carry out mining operations at its concession in Kalimantan due to overlapping permits. The Indian firm also demanded compensation worth US$581 million (about Rp 7.7 trillion).
Editing by Reiner Simanjuntak