Palm Oil

Palm oil company owes millions in fines for burning peat forest, but court blocks verdict

Tripa burning in 2012; photo by Carlos Quiles.

An Indonesian palm oil company that was fined the equivalent of 30 million US$ for illegally burning a vast area of peat swamp forest in Aceh has been granted “legal protection” by a local district court, which is refusing to execute the verdict that was upheld by the Supreme Court.

The company, PT Kallista Alam, is also being allowed to sue the Indonesian government.

Protestors yesterday (Thursday) called on the Supreme Court to intervene immediately and investigate the actions of the Meulaboh District Court, where Kallista Alam was originally convicted.

The director of Sumatran Orangutan Conservation Programme (SOCP), Ian Singleton, said the most recent court decision in Meulaboh was totally at odds with the guilty verdict that had been upheld in several appeals and was finally ruled upon by Indonesia’s Supreme Court.

The Tripa peat forest that was destroyed by Kallista Alam is known as the orangutan capital of the world. It lies within the Leuser Ecosystem, which is the last place on Earth where orangutans, rhinos, tigers, and elephants can be found living together in the wild.

“Tripa once harboured about 3,000 critically endangered Sumatran orangutans in its peat swamp forests, making it one of the most important orangutan habitats in the world,” Singleton said. “Today we are lucky if there are still more than 100 survivors of its destruction for palm oil.”

Singleton said that the SOCP team had managed to rescue several orangutans from Tripa and relocate them to safer areas, but the vast majority of the original population had died because of the incineration of their habitat.

“Add to that the vast amounts of carbon that have been released into the atmosphere and you have an environmental catastrophe on a truly global scale.”

An orphaned orangutan rescued near Tripa in 2012. Photo Paul Hilton/ SOCP/YEL.

The Meulaboh court was the one that, in 2014, found PT Kallista Alam guilty of illegally burning peat swamp forests to clear land for palm oil plantations and ordered the company to pay a total of 366 billion Indonesian rupiah in fines.

This comprised 114.3 billion rupiah (at that time nearly 9.4 million US$) in compensation to the state treasury and 251.7 billion rupiah (then close to 20.8 million US$) to restore 1,000 hectares of burned and deforested peatland.

Both the High Court in Banda Aceh and the Supreme Court in Jakarta rejected Kallista Alam’s appeals and, on August 28, 2015, the Supreme Court ordered the company to face the penalties imposed in the earlier ruling and instructed the Meulaboh court to execute the sentence.

Land cleared by Kallista Alam in Tripa. Photo by Dita Alangkara, September 2012.

The chairwoman of HAkA (Forest, Nature and Environment Aceh), Farwiza Farhan, said: PT Kallista Alam was found guilty of breaching administrational, criminal, and civil law in several legal prosecutions in our country’s highest courts. For a district court to now undermine decisions of Indonesia’s Supreme Court is a shocking twist in events.

“Unsurprisingly, many are now questioning the motives of the judge in this case, and calling for an investigation into the decision.”


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On September 28, 2016, Kallista Alam followed up its failed appeal at the Supreme Court with a request for a judicial review of the case, but this was also refused by the Supreme Court on April 18, 2017.

Harli Muin, who is the lawyer for the alliance of concerned citizens Gerakan Rakyat Aceh Menggugat (GeRAM), said that, on receiving the Supreme Court’s instruction, the Meulaboh District Court should have executed the verdict against Kallista Alam, but inexplicably suspended that execution.

This, Harli Muin said, was despite legislation (Article 66, paragraph 2, of the 1985 Law No. 14 ) that states very clearly that a request for a review of a Supreme Court decision cannot suspend or halt the execution of that decision.

The Meulaboh court did not, however, execute the verdict and, on July 20, 2017, the head of the court and the senior judge in the case, Judge Said Hasan, controversially granted “legal protection” to Kallista Alam in response to a request from the company on June 13, 2017.

Judge Said Hasan also stated that he would not execute the Meulaboh court’s own 2014 decision or the Supreme Court’s instruction pending the outcome of a new lawsuit filed by Kallista Alam against the government, which was filed on June 26, 2017.

Harli Muin says that Judge Said Hasan’s acceptance of Kallista Alam’s lawsuit contravenes his own court’s earlier ruling and the decision of the Supreme Court.

“If this new decision by the district court goes unchallenged, the fines against PT Kallista Alam in the civil case against them brought by the Ministry of Environment and Forestry may never be paid, and there will be no funds for restoration of the destroyed areas in Tripa.”

Tripa burning in June 2012. Photo: Paul Hilton/SOCP/YEL.

On April 13 this year, a panel of judges led by Said Hasan announced that they were accepting Kallista Alam’s lawsuit on the basis that incorrect coordinates were submitted as evidence by the Ministry of Environment and Forestry in the original case against the company and this constituted sufficient reason for the court to not execute its own sentence.

Environment ministry experts conduct field verification in Tripa.

Spokesman for GeRAM, Fahmi Muhammad, says there is no legal justification for the Meulaboh court to delay the execution of its own verdict.

“For the head of the Meulaboh District Court to now grant ‘legal protection’ to PT Kallista Alam is highly dubious, to say the least. We are shocked and very concerned about the extremely dangerous precedent this could set.”

“If we allow this kind of case to happen, other companies will not be afraid of breaking environmental rules because legal consequences can be easily mocked.”

GeRAM says that Kallista Alam is suing the environment ministry “under the pretext of an error in objecto over coordinates presented by the ministry in the original case against them, claiming that a minute typo in the coordinates renders their own original court verdict unimplementable”.

This minor typo could easily be ruled irrelevant, GeRAM says, because the Meulaboh District Court itself investigated the situation in the field during the original case, and conducted a field trial on the location of the forest fires.

The situation in the field was also examined by the High Court in Banda Aceh and by Indonesia’s Supreme Court, GeRAM says.

Environmentalists point out that the Meulaboh court’s actions are not only a troubling development in the case against Kallista Alam, but for Indonesia as a whole, and, more generally, there are implications for global action on climate change.

Yesterday (Thursday) GeRAM staged a demonstration in front of the Supreme Court to protest about the Meulaboh court’s actions.

The protestors demanded that Judge Said Hasan be investigated and suspended for granting “legal protection” to Kallista Alam and refusing to execute the fines imposed on the company.

“There is a strong suspicion of a legal infraction here. We demand that the Supreme Court immediately intervene and investigate this case,” Harli Muin said. 

On Wednesday, Crisna Akbar from Rumoh Transparensi in Aceh reported the actions of the Meulaboh court, which she called “suspicious deviations” in the execution of the Supreme Court decision, to Indonesia’s anti-corruption commission.

Kallista Alam was the first big palm oil company in Indonesia to be fined so heavily  for environmental destruction.  Other prosecutions resulting in significant fines have followed, but the companies in question, which include PT Merbau Pelalawan Lestari and PT Selat Nasik Indokwarsa, have yet to pay those fines and compensate the State for the damage they have caused.

The Meulaboh District Court also sentenced Kallista Alam’s estate manager Khamidin Yoesoef to three years in prison and imposed a fine of three billion rupiah (then about 256,000 US$).

The director of Kallista Alam, Subianto Rusyid, was also found guilty of illegally clearing peat forest and was sentenced to eight months in jail and fined 150 million rupiah (then about 13,000 US$).

Canals being blocked inside the former PT Kallista Alam palm oil concession in February 2015.


In a petition on GeRAM urges the Supreme Court to immediately annul the  Meulaboh District Court’s decision and make Kallista Alam pay its fines.