On 13 September 2013, the Indonesian government (through the Minister of Energy and Mineral Resources (the “MEMR”)) demonstrated its ongoing determination to implement the divestment requirement of the 2009 Mining Law by issuing Regulation No. 27 of 2013 on Procedures for Divestment and Share Pricing and Changes to Investment in Mineral and Coal Mining Businesses (“Reg 27/2013”).
Reg 27/2013 implements Government Regulation No. 23 of 2010 (as amended) (“GR 23/2010”). GR 23/2010 provides that foreign participation in a mining company holding a mining licence (“IUP”) must be divested through several domestic ownership levels following the end of the fifth year after production until the tenth year after production, so that by the end of year 10 at least 51% of the shares are owned domestically.
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