Complete Settlement Disputes to Content of the Mining Divestment Agreement (Case Study of Indonesian Government and Newmont Nusa Tenggara in Arbitration)

Abstract

One area of concern to foreign investors in terms of investing in Indonesia is the mining sector. To that end, the government seeks to direct and manage the natural resources that are included in the mining business field. Mining business fields include petroleum, natural gas, coal, metals, tin, iron ore, bauxite, iron sand, silver and copper concentrates. "Cooperating with foreign parties, primarily through international contracts, the national interest becomes a key consideration. Indonesia has entered into a contractual agreement with foreign companies International contracts also have a dispute over understanding between the Parties One of the breaches of the Contract of Work Agreement between the Government of Indonesia and PT Newmont Nusa Tenggara (hereinafter referred to as PT NNT) The establishment of a work contract between the Government of Indonesia and PT NNT refers to Law No. 11 of 1967 on the Basic Provisions of Mining, and now following the renewal of the law, its regulation under the Law of the Republic of Indonesia Number 4 Year 2009 concerning Mining of Minerals and Coal One of the clauses in the Contract a between the Government of Indonesia and PT.NNT as contained in article 24 paragraph 3 of the contract of work that PT. NNT must ensure that shares owned by foreign investors will be offered for sale or publication, firstly to the government and second (if the government does not accept the offer within 30 days of the offer date), to Indonesian citizens or Indonesian companies controlled by Indonesian citizens. In reality the contents of the agreement relating to clauses in the Contract of Work Agreement concerning the divestment of shares for the Indonesian government gradually is not working properly, where the mining company fails to perform the divestment obligation of shares in accordance with the agreement of Contract of Work which has been agreed. This has led to disputes between the two parties, with the Government of Indonesia bringing the settlement of the matter to the Arbitration Institute.