Palm oil firm that dried out its land held not liable for fires that followed

  • Indonesia’s highest court has upheld a ruling clearing a palm oil company of responsibility for fires in its concession in Central Kalimantan province.
  • Environmental experts say this flies in the face of evidence showing that the firm didn’t have adequate equipment to tackle fires and that the fires started in areas it had recently cleared and drained.
  • They warn the verdict sets a worrying precedent for future prosecutions of companies with fires on their concessions, and counters Indonesia’s efforts to reduce greenhouse gas emissions from land use.

JAKARTA — Indonesia’s highest court has upheld a ruling declaring a palm oil company not responsible for fires in its concession, in a verdict that boils down to the company not being liable simply because it had put up “no burning” signs.

Environmental experts say the Nov. 8 ruling by the Supreme Court in favor of palm oil company PT Kumai Sentosa (KS) deals a blow to the country’s efforts to punish environmental violators and curb greenhouse gas emissions from land use.

A court in Pangkalan Bun district, Central Kalimantan province, had in February found KS not criminally responsible for the fires that razed 2,600 hectares (6,400 acres) of its concession in 2019.

The Supreme Court, in hearing an appeal filed by prosecutors, sided with the earlier ruling, saying the company couldn’t be held responsible for the fires because it did not intend for its land to be burned. For starters, it said, KS had erected a sign prohibiting burning.

“And then every working [shift], the workers have always been given directions to not burn and to extinguish [fires] whenever they see tinder flaring up,” the panel of judges said.

“This proves that KS is very concerned about [the importance of] not burning lands in its palm oil concession. And so it’s very illogical if KS is sued for burning its own lands.”

The judges noted that while it was true there were fires on the company’s concession, they originated from neighboring Tanjung Puting National Park.

“Therefore, KS’s palm oil concession was burned not because it was deliberately set aflame by KS,” the judges said, adding that the company took measures to try to put out the flames. “If the fires were deliberate, then there’s no need for KS to try to extinguish the flame that had spread to its palm oil plantations.”

Burning concession of palm oil company PT Kumai Sentosa in Central Kalimantan province, Indonesia. Image courtesy of the Indonesian Ministry of Environment and Forestry.

Dissenting opinion

The verdict exonerating PT Kumai Sentosa wasn’t unanimous, however. In the sole dissenting opinion, Judge Salman Luthan said the company had cleared land on its concession from April to May 2019, during the dry season. As a result, the peatlands in its concession had dried out, leaving a tinderbox of highly flammable dead vegetation.

“Therefore, it’s assured that the defendant, KS, hasn’t implemented precautionary principles in preventing and mitigating land and forest fires, which is its responsibility as a plantation operator,” Salman said.

Based on this failure to keep its concession free from fires, KS should pay for all the environmental damages caused by the blaze, he added.

“This is a true implementation of an international principle that’s applied universally, called polluter pays principle, as a form of substantive legal principle that has to be upheld to enforce the environmental law here,” he said.

Last year, a joint investigation by Mongabay Indonesia, Tempo, Betahita and Malaysiakini corroborated the findings that the company had cleared vegetation and built canals to drain the peatland before the fires occurred. According to the investigation, the first fires flared up in parts of the concession where the drainage canals had most recently been built in June 2019.

Plantation companies operating on peat typically dig canals to drain the waterlogged land so that they can start planting oil palm trees. But this draining dries out the thick peat layer and renders it susceptible to fires.

Greenpeace Indonesia senior forest campaigner Asep Komarudin said the other judges hearing the appeal failed to take this into account in their ruling.

“The judges don’t pay attention to the fact that peatland is a landscape” that should not be drained, he told Mongabay. “Peatlands are rendered dry by business activities around them, including in the case of KS.”

Burning concession of palm oil company PT Kumai Sentosa in Central Kalimantan province, Indonesia. Image courtesy of the Indonesian Ministry of Environment and Forestry.

Testimony presented in the district court trial also pointed to lapses by PT Kumai Sentosa.

Nur Alam Bin Abdul Rachman, the plantation manager at KS, said he had asked the company for firefighting equipment on July 7, 2019, but his request was rejected.

Bambang Hero Saharjo, a leading expert on forest fires from the Bogor Institute of Agriculture (IPB), testified that KS didn’t have adequate facilities, such as early-warning or detection systems, communication systems, or personnel — all of which are mandated by law — to prevent and fight fires.

As a result, fires routinely flared up on its concession, sometimes burning for days.

Prosecutors had sought a total of 935.73 billion rupiah ($65.5 million) in the district court trial for environmental damages caused as a result of the fires. But this has now been rejected by two courts.

This could set a bad precedent for future efforts to hold companies responsible for forest fires, said Roni Saputra, legal director of environmental NGO Auriga Nusantara.

Raynaldo G. Sembiring, executive director of the Indonesian Center for Environmental Law (ICEL), said the Supreme Court ruling was disappointing in light of an earlier judgment in a separate civil case at the same district court in Pangkalan Bun. In that lawsuit, brought by the environment ministry, the court ruled on Sept. 23 that KS was responsible for the fires and fined it 175 billion rupiah ($12.3 million). Even then, that’s a fraction of the 1.19 trillion rupiah ($83.6 million) that the ministry was seeking. The company is appealing that decision.

“This means that the crimes done by the company against our environment go unpunished,” Raynaldo told Mongabay.

He said it’s important for companies with fires in their concession to face criminal prosecution, not just be subjected to civil lawsuits. He said criminal charges and verdicts have a much stronger deterrent effect than a civil judgment, with a company being formally declared a polluter and a criminal by the state.

The guilty verdict in the civil lawsuit might therefore not be enough to spur companies like KS from doing more to prevent fires on their concessions, Raynaldo said.

“Deterrent effects cannot be maximized without a criminal charge and verdict,” he said. “A criminal status will make it difficult for someone to get a job and it might also affect a company’s reputation. This means a company is not green and it has a bad track record. The company will not be able to deny that it’s a perpetrator of crime.”

Raynaldo said the government should file a case review, a final legal challenge after an appeal to the Supreme Court has failed. He said Judge Salman’s dissenting opinion, coupled with the verdict in the civil suit, make it likely that a case review will be accepted and a guilty verdict handed down.

Burning concession of palm oil company PT Kumai Sentosa in Central Kalimantan province, Indonesia. Image courtesy of the Indonesian Ministry of Environment and Forestry.

Raynaldo said it’s important for judges and other law enforcement officials to view environmental cases like that of PT Kumai Sentosa not as a simple and isolated crime.

“Don’t see this as something that only affects a company and the surrounding locals,” he said. “But see this as something that affects our nation’s commitment in tackling climate change.”

Forcing companies that have had their concessions burned to restore the ecosystems will go a long way toward mitigating greenhouse gas emissions, and thus climate change, Raynaldo said. On the other hand, releasing companies from their responsibilities to restore the environment will exacerbate the problem, he said.

“The court has a significant role in our efforts to reduce greenhouse gas emissions,” Raynaldo said. “That’s why the court’s ruling is disappointing because it ignores the fact that the impact of climate change has been felt [everywhere].”


Banner image: Burning concession of palm oil company PT Kumai Sentosa in Central Kalimantan province, Indonesia. Image courtesy of the Indonesian Ministry of Environment and Forestry.

Related listening from Mongabay’s podcast: To understand what is being done to restore peatlands that have been drained, we spoke with Indonesia’s Deputy Head of the National Peatland Restoration Agency and a researcher on the value chain, finance and investment team at CIFOR, the Center for International Forestry Research, listen here:


FEEDBACK: Use this form to send a message to the author of this post. If you want to post a public comment, you can do that at the bottom of the page.