Indonesia’s mining sector is undergoing a significant transformation. Traditionally, access to Mineral and Coal Mining Business Permit Areas (Wilayah Izin Usaha Pertambangan / WIUP) was primarily available to state-owned enterprises, regional government-owned enterprises, and private business entities through competitive licensing mechanisms. However, recent regulatory developments have introduced a new policy direction by granting priority access to certain mining areas for religious community organizations (ormas keagamaan) and cooperatives (koperasi).
The legal basis for this policy can be found in the recent amendments to Indonesia’s mining legislation, particularly Law No. 2 of 2025 concerning the Third Amendment to Law No. 4 of 2009 on Mineral and Coal Mining (Mining Law). One of the key changes introduced by the amendment is the expansion of entities eligible to obtain Mining Business Permit Areas (Wilayah Izin Usaha Pertambangan / WIUP) through priority allocation mechanisms.
Under the amended Mining Law, the Government may grant priority access to certain WIUPs to cooperatives, micro, small and medium enterprises (MSMEs), and religious community organizations (ormas keagamaan). This policy reflects the Government’s intention to create a more inclusive mining industry and to ensure that the economic benefits generated from Indonesia’s mineral and coal resources can be enjoyed by a broader segment of society.
The amendment also emphasizes that the granting of priority access does not exempt recipients from complying with applicable mining regulations. Entities receiving such priority rights must continue to satisfy the technical, environmental, financial, and administrative requirements prescribed under the Mining Law and its implementing regulations. In other words, while access to mining areas may become more accessible for certain groups, the fundamental principles of good mining governance, environmental sustainability, and regulatory compliance remain fully applicable.
The implementation of these provisions is expected to be further detailed through government and ministerial regulations governing, among other matters, the eligibility criteria for participating organizations, allocation mechanisms, licensing procedures, partnership structures, and the supervision of mining activities conducted by these newly eligible participants. As such, this development represents one of the most significant changes in Indonesia’s mining regulatory landscape in recent years and reflects the Government’s broader objective of ensuring that the economic benefits derived from the country’s abundant mineral and coal resources are distributed more broadly across society.
By expanding participation in the mining sector beyond conventional corporate players, the Government seeks to strengthen economic empowerment, promote community-based development, and create new opportunities for cooperatives, religious community organizations, investors, and other stakeholders that have historically played important social and economic roles within Indonesia.
For many observers, the inclusion of religious community organizations in the mining ecosystem marks one of the most notable policy shifts in recent years. Religious community organizations in Indonesia have long been involved in education, healthcare, social welfare, and community development programs. The new framework potentially allows these organizations to participate in mining-related business activities and generate revenue that may be used to support their social missions and public services. At the same time, participation in the mining sector also brings substantial responsibilities. Mining is a highly regulated industry that requires compliance with environmental standards, licensing requirements, operational safety obligations, and corporate governance principles.
The policy also opens the door for cooperatives to become more active participants in Indonesia’s mineral and coal industry. This aligns with Indonesia’s longstanding commitment to economic democracy and community participation. Cooperatives have historically served as vehicles for empowering local communities and small-scale economic actors. Through access to mining opportunities, cooperatives may be able to play a larger role in regional economic development, particularly in areas rich in mineral and coal resources. The Government hopes that broader participation will help create jobs, stimulate local economies, and ensure that mining activities generate more inclusive economic benefits.
Nevertheless, obtaining priority access to a WIUP should not be interpreted as a relaxation of regulatory requirements. Mining remains one of the most heavily regulated sectors in Indonesia. Any entity entering the mining industry, whether a cooperative, religious community organization, or private investor, must still comply with the applicable legal framework governing mineral and coal mining activities. This includes licensing requirements, environmental approvals, reclamation and post-mining obligations, occupational health and safety standards, reporting requirements, and compliance with tax and non-tax state revenue obligations.
From a legal perspective, one of the key challenges for newly eligible participants will be ensuring that appropriate business structures and governance mechanisms are in place. Mining projects typically require significant capital investment, technical expertise, risk management systems, and long-term operational planning. As a result, many organizations may need to explore strategic partnerships, joint ventures, or other forms of collaboration with experienced mining operators and investors to successfully develop and manage mining assets.
The introduction of priority access for religious community organizations and cooperatives also presents new opportunities for investors and existing mining companies. As new participants enter the sector, there may be increased demand for investment partnerships, project financing, operational support arrangements, and corporate structuring solutions. Businesses seeking to collaborate with cooperatives or religious community organizations should ensure that such arrangements are properly documented and comply with applicable mining, corporate, investment, and competition laws.
Given the strategic importance of Indonesia’s mineral resources and the Government’s continuing focus on downstream processing and value-added industries, the mining sector is expected to remain one of the country’s most attractive investment destinations. The expansion of access to WIUPs demonstrates the Government’s intention to create a more inclusive mining ecosystem while maintaining regulatory oversight and promoting sustainable resource development.
For organizations, cooperatives, and investors considering opportunities in Indonesia’s mining sector, understanding the evolving regulatory framework is essential. Early legal assessment, proper corporate structuring, and comprehensive regulatory compliance can help stakeholders mitigate risks and maximize the value of their investments.
At Schinder Law Firm, we regularly advise domestic and international clients on mining investments, mineral and coal licensing, WIUP acquisitions, joint venture arrangements, mergers and acquisitions, regulatory compliance, foreign investment, and natural resources projects throughout Indonesia. Our team has extensive experience assisting clients in navigating complex regulatory requirements and developing practical legal solutions for mining and energy projects.
Whether you are a cooperative seeking to enter the mining sector, a religious community organization exploring new economic opportunities, or an investor looking to partner with emerging participants in Indonesia’s mining industry, Schinder Law Firm is ready to assist. For further information regarding mining investments, WIUP opportunities, mining licenses, or mining-related regulatory compliance in Indonesia, please contact us at info@schinderlawfirm.com.
Author:
Dewi Susanti