The Power of Discretion: Navigating State Administrative Jurisprudence on Environment

• Government Discretion in Indonesia
• The Use of Discretion in Decision-Making

Government Discretion in Indonesia

Article 1 number 9 of Law Number 30 of 2014 on Government Administrative (“Government Administrative Law”) which has been amended through Law Number 6 of 2023 on the Stipulation of Government Regulation in Lieu of Law Number 2 of 2022 on Job Creation into Law (“Job Creation Law”), stipulates that:

“Discretion is a Decision and/or Action determined and/or carried out by a Government Official to overcome concrete problems faced in the administration of government in terms of laws and regulations that provide choices, do not regulate, are incomplete, or unclear, and/or there is government stagnation.”

Discretion can only be exercised by authorized officials with one of the objectives is to fill the absence of law and provide legal certainty (Article 22 of Government Administrative Law). Discretion must meet the conditions, in accordance with the purpose of the discretion, not contrary to laws and regulations, in compliance with the general principles of good governance, by objective reasons, does not cause conflicts of interest, and is carried out in good faith.

The use of discretion, as the grounds for government officials to issue and/or carry out a State Administrative Decision (“Keputusan Tata Usaha Negara/KTUN”) and/or Administrative Action, must be exercised by explaining its intent, purpose, substance, and impact, as referred to the provisions under Article 26 to Article 29 of the Government Administrative Law.

Read Also: Authority Defects in State Administrative Law Jurisprudence

While its purpose might be directed to facilitate and for the benefit of public interest in providing legal certainty, it does not eliminate possibility that there might be certain parties that feel aggrieved. When such matter occurs, they often challenged the authority of the relevant officials, claiming that the KTUN and/or Administrative Actions shall be deemed invalid, due to the lack of authority of the relevant officials.

Given the broad scope of what may constitute discretion, this conditions often raises confusion, particularly because the legal provisions governing discretion are scattered across various laws and regulations, and are often highly dependent on the specific sector. In fact, it is also sometimes might appear unclear as to whether a particular provision indeed grants discretionary authority. Further, even when discretion is explicitly regulated by the prevailing laws and regulations, this does not eliminate the possibility that the authority of the relevant official may still be legally challenged with regard to the dispute.

The Use of Discretion in Decision-Making

In regards to the scope of discretion, as outlined in Article 23 of the Government Administrative Law, includes the adoption of KTUN or Administrative Action, based on and/or due to:

• The provisions of laws and regulations that provide an option for KTUN and/or Administrative Action;
• The laws and regulations do not regulate;
• The laws and regulations are incomplete or unclear; and
• There is a government stagnation for the sake of broader interests.

In its elucidation of letter (a) of Article 23 on the option for KTUN, the law provides that they are characterized by the words e.g., can, may, is authorized, is entitled, should, is expected, and other similar words.

Therefore, in order to understand this matter further, will be discussed through the following jurisprudence, examining of what may constitute as discretion, how is discretion used by government officials/agencies, and how do the judges’ asses such disputes. Let us see based on this case study in the Decision Number 553 K/TUN/2022.

In this case, the object of the dispute is the Decree of the Minister of Environment and Forestry Number SK.437/Menlhk/Setjen/HPL.0/11/2020, dated November 20, 2020 on the Second Amendment to the Minister of Forestry’s Decision Number 908/Kpts-II/1999, dated October 14, 1999 on the Granting of Industrial Plantation Forest Concession Rights, addressed to the Claimant.

The claim over the object of dispute in the form of KTUN, which is issued by the Defendant as the Minister of Environment and Forestry (“MoEF”) was filed by the Claimant, who essentially claimed for it to be declared null and void, and to be revoked.

Judex Juris‘ legal considerations in Decision Number 553 K/TUN/2022 states:

“…that the act of issuing the State Administrative Decision on the object of the dispute is in accordance with the intention of granting policy authority (discretion) to the Respondent in Cassation I/Defendant by statutory regulations, as stipulated in Article 2 paragraph (2) letter c, Article 2 paragraph (3) letters b and c and Article 7 paragraph (1) of the Regulation of the Minister of Forestry and Environment Number P.45/MENLHK/SETJEN/HPL.0/2016 on Procedures for Changing the Area of ​​Forest Product Utilization Business Permits in Production Forests…”

As what was stated in the Judex Juris of the Supreme Court’s consideration, regarding Article 2 paragraph (2) of the Regulation of the Minister of Forestry and Environment Number P.45/MENLHK/SETJEN/HPL.0/2016 on Procedures for Changing the Area of ​​Forest Product Utilization Business Permits in Production Forests (“MoEF Reg. 45/2016”), stipulates that changes in the size of areas of a forest product utilization business licenses in production forest can be carried out in the event of government discretion, among others, in the context of resolving tenurial conflicts (in the context of land or natural resource rights, this means rights to ownership, management and utilization of natural resources, whether formally regulated through the law or traditionally or customarily) in the permit area. This provision shows that discretion (government policy) is indeed possible regarding changes in the area of forest product utilization business licenses in production forest.

The Supreme Court’s decision was subsequently upheld at the Judicial Reconsideration (Peninjauan Kembali) through the Decision Number 155 PK/TUN/2023, which essentially considers that the Claimant was proven to have “…abandoned and failed to carry out activities on-site because the area… was not managed properly…”

In this case, the KTUN was issued based on the MoEF’s discretion and is considered valid, since such discretion is authorized under the MoEF Reg. 45/2016 and according to the facts of the case. This essentially means that Article 23 of Government Administrative on conditions of discretion, particularly on the letter (a), namely the provisions of laws and regulations that provide an option for KTUN (i.e., Article 2 paragraph (2) of MoEF Reg. 45/2016 is the basis of this discretion).

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Sources:

• Law Number 30 of 2014 on Government Administrative.
• Law Number 6 of 2023 on the Stipulation of Government Regulation in Lieu of Law Number 2 of 2022 on Job Creation into Law.
• Regulation of the Minister of Forestry and Environment Number P.45/MENLHK/SETJEN/HPL.0/2016 on Procedures for
• Changing the Area of Forest Product Utilization Business Permits in Production Forests.
• Supreme Court Decision Number 155 PK/TUN/2023.
• Supreme Court Decision Number 553 K/TUN/2022.