Indonesia: NGOs file complaint against Holcim to Swiss National Contact Point, allege land rights abuses - company responds

On 19 March 2015, a group on NGOs and other civil society organizations, on behalf of the Ringinrejo people of East Java, filed a complaint to the Swiss OECD National Contact Point (NCP) against Holcim Indonesia (part of Holcim Group, a Swiss building materials and aggregates company). The complaint alleges that Holcim Indonesia is violating the OECD Guidelines and causing adverse human rights impact to local communities, including by violating Indonesian laws on compensation for land's acquisition. Business & Human Rights Resource Centre invited Holcim Group to respond to the allegations and the company did so. In June 2015, the Swiss NCP published a initial assessment of the complaint. It concluded that the issues raised merit further considerations and accepted the instance.  

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Report
3 July 2015

Swiss National Contact Point accepts complaint against Holcim

The initial assessment of the NCP results in the conclusion that the issues raised in this specific instance merit further consideration, and the NCP therefore accepts the specific instance. This conclusion should not be construed as a judgment of whether or not the corporate behaviour or actions in question were consistent with observance of the OECD Guidelines and should not be equated with a determination on the merits of the issues raised in the submission. 

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Company response
30 March 2015

Holcim response

Holcim appreciates the opportunity to respond to the Joint Press Statement on the land acquisition processes in Indonesia. We take such concerns by civil society actors very seriously and immediately sought feedback on the issues raised from our Group company in question, PT Holcim Indonesia Tbk. 

From our perspective and after analyzing the respective documents and data, the land transaction process was handled diligently and in an effort to find a satisfactory solution for all the parties involved, as exemplified by the following elements: 

  • The land swap process goes back to 1990, when the predecessor of Holcim Indonesia, PT Semen Dwima Agung  (PT SDA)  applied to open forest land in Tuban for industrial use. To compensate for the forest land used and after all the necessary approvals were issued, PT SDA purchased land in Blitar in 1996 and transferred it into state land in 1998. This process was completed in fulfilment of all the regulatory obligations for land swaps. However, the reforestation process led by a state-owned company was opposed by farmers who started cultivating the land, as a consequence of which reforestation eventually halted.
  • In an effort to mediate the dispute, PT SDA agreed to release 40 hectares of land for distribution to farmers in 2008. An agreement was reached in 2010 with the mediation of the Blitar parliament and officials. The authorization letter was signed by the representative of 978 farmers in front of local members of parliament with Head of Blitar Regent, registered by notarial act, and publicly exposed in front of the Jolosutro mosque in Ringinrejo village. 
  • Some farmers later withdrew from the agreement. Renegotiations started in 2011 in an effort to foster long-term cooperation and a trustful relationship. A scheme in which farmers are involved in the land reforestation process and still able to cultivate crops, accompanied by CSR programs for community empowerment, was developed.  In 2013, the land in Blitar was handed over to the Ministry of Forestry of Indonesia and released as forest area.
  • Eight rural communities of Ringinrejo, known as the Farmers Paguyuban Aryo Blitar (PPAB), filed a complaint to the administrative court in Jakarta to cancel the decision of forest land designation from the ministerial decree. The plaintiffs were rejected by the court. An appeal filed in April 2014 was rejected as well.

We are open for further dialogue on this process. At Holcim, we are fully committed to respecting human rights. Standard processes for meaningful stakeholder engagement are in place in all our Group companies, including Holcim Indonesia. The company has a Community Engagement Plan (CEP) covering all sites, which ensures that social needs and concerns are addressed in a systematic manner. Formalized Community Advisory Panels (CAPs) provide for a regular exchange with host communities at the cement plants in Narogong, Cilacap and Tuban, as well as the aggregate quarries in Maloko and Jeladri. 

Furthermore, we have a Group-wide human rights management system in place to implement the UN Guiding Principles on business and human rights. In this context, PT Holcim Indonesia Tbk conducted a human rights impact assessment in 2012, which included consultations with relevant stakeholders, including community members, at five plants, among them Tuban. Land acquisition processes were not mentioned as an issue by the stakeholders consulted at that time. Other identified risk areas were addressed with a follow-up assessment and targeted actions in 2013. 

We are confident that the concerns raised in the Joint Press Statement can be clarified in a constructive dialogue and remain at your disposal for further information. 

Item
30 March 2015

NGOs' complaint against Holcim to Swiss National Contact Point

Author: ELSAM, Fransiscans International, Sitas Desa, Aryo Blitar Farmers Association, TuK Indonesia, Consortium of Agrarian Reform, AURIGA

"Holcim Ltd Must Be Responsible for the Acquisition of the Rights to Cultivate of the People of Ringinrejo", 19 March 2015

[C]ivil societies, that have supported the people of Ringinrejo, Wates, Blitar, East Java to fight for their rights to cultivate their lands, are filing a complaint to the Swiss National Contact Point as PT. Holcim Indonesia, a part of Holcim Ltd Group from Switzerland, that is directly causing adverse human rights impact to the local communities through their operations. The violations done by PT. Holcim Indonesia Tbk. (Holcim Ltd. Group) in giving compensation land to the Ministry of Forestry are as follows: 1. The land compensation for the corporation activities has violated Indonesian laws. 2. The company has engaged in deliberations, but not with legitimate community members.3. The joint statement or agreement was not made transparently. Through writing this complaint letter to the National Contact Point (NCP) in Switzerland, we, the civil society organizations, assissting the people of Ringinrejo, hope that the NCP consider the issue between the Ringinrejo community and PT. Holcim Indonesia (Holcim Ltd. Group), and through NCP facilitation, can find a resolution to the problem, namely that: PT. Holcim Indonesia Tbk. finds a compensation land that does not violate the rights of the people of Ringinrejo village; or a final agreement is reached between PT. Holcim Indonesia Tbk. and the people of Ringinrejo village through effective deliberations; as to completely redress the impacts of the harm felt by the people.

 

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