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Thursday, April 15, 2010

Close-up of tap waterImage via Wikipedia
From Manilla Bulettin:
The Indonesian water system is also marked by high system loss, decades of under-investment in the water infrastructure, and a poor regulatory system. Rivera explained that "they are not anchored on cost reflective tariff so... it's very difficult to invite the private sector.
However, he said there is a lot of potential in Indonesia since it has a larger population of 200 million and it is growing faster than the Philippines. Indonesia has an emerging metropolis and its metropolitan areas are much bigger than those in the Philippines.
"The key to sustaining these areas would be water infrastructure," noted Rivera adding that it will take one to two years before a project can start development.
As for cost, it will require investments of $30 million to $50 million if its a bulk water supply project. If it's a distribution project, the cost can be much bigger because there is a need to replace the pipes.

 Another PPP/PSP. What do you think?
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Vague articles in information law gives rise to concern | The Jakarta Post

A member of the Press Council, Wina Armada Sukardi, said on Monday in a discussion at the Press Council office in Jakarta that some of the articles could possibly criminalize the work of the press.

He cited Article 51, which stipulates that institutions or persons using information in an “unlawful manner” would face one year in prison and/or a maximum fine of Rp 5 million (US$544).

“There is no fixed definition of ‘unlawful manner’ so the press will be prone to criminalization,” he said.
Another speaker at the discussion, Mas Ahmad Santosa, a member of the Judicial Mafia Taskforce, said that there were also some requirements in the law that could make its implementation difficult.

“The person or institutions demanding information have to state the purpose of their request for information,” he said.

He continued that the law also gave room for public institutions to reject requests if the information had not been documented.

via thejakartapost.com

Quick blogging. Three interesting issues are raised here: (1) use of 'unlawful' information, (2) statement of purpose on using information and (3) the exemption clauses. I have discussed exemption clause on my previous article. I will discuss the rest later.

 

Marquette Law School adds new course to curriculum

Wednesday, April 14, 2010

Logo of Marquette UniversityImage via Wikipedia









Water law rising as a new  practice area

Marquette Law School adds new course to curriculum

by Jack Zemlicka

June 22, 2009

Over the next decade, legal questions over the use and conservation of the state’s water supply are expected to multiply like the boats that dot the 15,000 lakes in Wisconsin each summer.
According to attorneys who handle water-related issues as part of their practices, concerns over how water is used and who has access will grow as the population increases and the climate changes.
Coupled with recent regulatory efforts such as the Great Lakes Compact of 2008, which seeks to divide and limit water use among the eight states touching the Great Lakes and the Canadian Provinces of Ontario and Quebec, and recent bids by suburban areas in Wisconsin to import water from Lake Michigan, these developments are fueling an emerging practice area — Water Law.
“This is a cutting edge area of the law,” said Matthew Parlow, a professor at Marquette University Law School. “Water usage will be one of the major legal issues of the next few decades.” 
via wislawjournal.com
It is interesting to see that even in the US, a water law curriculum in law school is relatively new.
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The nature of the Indonesian Blasphemy Law

Tuesday, April 13, 2010

No more: Blasphemy Laws!Image by helen.2006 via Flickr
In human rights conventions, religion tends not to be protected ipso facto. If there are limitations to the freedom of speech and expression, this limitation is aimed at preserving public order. So the human rights conventions does not protect religion, but protect the followers in practising their beliefs and can restrain those freedoms if public ordre is threatened.

However, in the worlds' blasphemy laws, this is not always the case. Some jurisdictions protects religion as it is, irrespective of any public order arguments. Along with the ongoing judicial review of the Blasphemy Law at the Constitutional Court, my working paper tries to outline this debate. I copy-paste below, a paragraph in my working paper.
Article 156a of the Indonesian Criminal Code contained a criminal provision of 5 years of imprisonment for those “who deliberately, in public, which in essence sparked hostility, insulting or abusive views towards religions with the purpose of preventing others from adhering to any religion based on God.”. This Article has been ambiguous with respect to its criminalization theory as there are doubts as to whether it is motivated by Religionschutzstheorie or public order reasons. Judging from its position in the Criminal Code, Article 156a is placed in Chapter V of the Criminal Code which regulates the crimes against public order, along with Article 156 which criminalizes those who spark hatred against others. However, if seen from the content, the Article does not contain any condition which suggest that it will be activated only if carried out in a manner which disturbs the public peace such as the German’s § 166. Thus, Article 156a could be enforced irrespective of whether the insult caused public peace to be disturbed, or whether it would injure the feeling of religious adherents or not. To give a concrete example, Article 156a could be activated although the offence is conducted before persons who are not an adherent of any religion.[1]

The ambiguity of Article 156a has been acknowledged by Prof. Seno Adji with him proposing it to be reformed so that it can fully protect religion. It was proposed that Article 156a should be reconstructed and removed from Chapter V as it is clear that its content is in protecting religion, irrespective of public order.[2] However, even without this modification, in practice Article 156a has been very extensively applied so as to cover cases involving both public order and non public order. With these facts, it can be inferred that the interpretation and application of Article 156a leaned toward Religionschutzstheorie rather than Friedenschutzstheorie or Gefühlschutzstheorie.

Download the full paper here. What do you think about this analysis?

Have a look also at my op-ed article and previous blog posts.









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National Science Foundation (NSF) Logo, reprod...Image via Wikipedia
Northeastern to host Global Regulation of Nanotechnologies conference in Boston, May 7 to 8 (Nanowerk News) Leading international experts on the global regulation of nanotechnologies, including scientists, lawyers, ethicists and officials from governments, industry stakeholders, and NGOs will join in a two-day conference May 7-8, 2010 at Northeastern University’s School of Law.
The conference will identify best practices that address the needs of industries, the public and regulators. Speakers include representatives from the U.S. Environmental Protection Agency, the Brazil Ministry of Science and Technology, the Korean governent, the International Conference of Chemicals Management and National Science Foundation-funded university-industry collaborations.

Looks like an interesting conference folks...

 

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New Dates for Dialogue with Business Leaders and Regulators at EPSCA Forum, 6-8 July 2010

82410 - Official Brochure v7.pdf (593 KB)
View this on posterous

Due to new developments, EPSCA Forum is moved to a new date 6-8 July 2010. Following is the excerpt of the email I received:
 

Last week, a major development has occurred where major support from Dr Evita Legowo, Director-General – Oil & Gas, Ministry of Energy, had been cemented which will bring us closer to the forum’s raison d'être, Reformed, Energetic and Efficient E&P Industry in Asia Pacific through fresher, commercially viable E&P agreements, and increased certainty on regulations, risks and returns from E&P investments in Asia, especially Indonesia.

Hence, I was informed this evening that the EPSCA Forum will be moved to its new date on 6-8 July 2010 in view of this major positive development, which would be a great opportunity for all delegates to have an exceedingly impactful meeting with colleagues and regulators. 

Due to the definitive importance of new regulatory developments in Indonesia pertaining to upstream contracts and the push for more commercially viable arrangements for technically complex plays, major upstream players and other investors have confirmed to join us at this important meeting. We may also get the players who are recently involved or interested in making money out of these technically complex upstream opportunities. We suggest you may want to conduct some interviews on site if you will be sending a representative, as the combination of delegates, speakers, partners and sponsors is very unique and rarely found at one place.

 

Please find the revised brochure attached.

 

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Welcoming the freedom of information law | The Jakarta Post

Monday, April 12, 2010

Welcoming the freedom of information law

Mohamad Mova Al ‘Afghani ,  Dundee, UK   |  Sat, 04/10/2010 9:42 AM  |  Opinion

“Sunlight is said to be the best of disinfectants; electric light the most efficient policeman” (Justice Louis D Bran-deis, On Other People’s Money and How the Bankers Use it, 1933, Chapter V).

Not so many people know that next May, the Freedom of Information (FoI) law will come into effect.

This law will have tremendous implications in increasing transparency in government operations and to a certain extent, the business world.

The central idea of the FoI law is to bring government “into the sunlight”. The “sunlight” will allow the governed to observe clearly government operations that are otherwise performed in secrecy. Because they will be watched, it is expected that the public officials will behave accordingly.

The FoI law provides everyone, irrespective of their motives, a right of access to information held by public bodies.

The understanding of “public bodies” in our FoI law varies from all governmental branches in the executive, judiciaries and the legislative, to political parties, state-owned enterprises, non-governmental organizations and other legal entities receiving funding from the state or regional budget.

Not all information can be disclosed, however. The FoI law provides a restrictive list of information which could be exempted from disclosure.

Compared to FoIs in other countries, the list of exemptions in the Indonesian FoI law is very narrowly constructed.

This means that the exemption to disclosure only applies to very few types of information such as that related to defense, intelligence, law enforcement, intellectual property rights, personal information and diplomatic relations.

Other than the limited and narrowly construed exemption clauses, what makes our FoI more “generous” compared to other countries’ FoI laws is also the fact that there is an obligation to apply public interest testing to each and every exemption clause.

Other countries’ FoI laws, such as the English and Scottish laws recognize two types of exemptions: absolute and relative. If the exemption type is absolute, such as that related to security matters, the English FoI law requires no public interest testing.

The Indonesian FoI law, however, recognizes no absolute exemption. This means that a public interest test would be mandatory in any case.

What this means is that the exemptions to defense, intelligence and diplomatic relations as discussed previously are not absolute. If the Information Commission considers that there is a greater interest for transparency rather than keeping the information secret, the information should be disclosed, even though it is a security matter or even if such a disclosure is prohibited in other acts.

Is this a good thing? It depends on where you are standing. Imagine that because there is no absolute exemption clause in the legislation, one can actually submit an information request to the State Intelligence Agency, the financial intelligence unit (PPATK), the Central Bank and even private banks if they are state-funded.

If they fail to provide, one can always appeal to the Information Commission to ask for the application of a public interest test.

That being said, the Information Commissions (central and regional, depending on the case), actually have the discretionary power to decide on the fate of information in all branches of the government.

Their jurisdiction covers all departments, with respect to all types of information, without any exception.

Given that vast responsibility, the Information Commission may face complexities in settling disclosure cases. They will have to decide whether information such as defense contracts to purchase arms, the utilization of foreign funds to finance counter terrorism units, a company’s tax reports, governmental procurement contracts and diplomatic correspondences contain a certain public interest that warrants public disclosure.

Due to the fact that no single governmental department is free of corruption, one could expect that a public interest for disclosure could be found in a great number of cases. The pressures toward nondisclosure from the bureaucrats would be enormous. It is in this respect that civil society’s role is vital.

Although in the preceding paragraphs I have pointed out that our FoI law is “generous”, the vague constructions of the clauses still open gaps for the government to tamper with its enforcement, such as through the creation of nontransparent implementing regulation which may defeat the original object and purpose of the FoI.

It would be the ministry of communication and information that is tasked with the formulation of Peraturan Pemerintah (Government Regulations).

If this tendency toward openness is to be maintained, civil society needs to pay attention so that the enactment of the implementing regulations are transparent themselves and that the public is involved in the decision-making process.

It is possible that the exemption clauses within the FoI law are “further reinterpreted” in the implementing regulation which in practice will allow more constrain to disclose requests.

To anticipate such a maneuver, I consider that for the majority of FoI issues, the implementing rule should be constructed from the ground up based on guidelines and case law, rather than top-down through Peraturan Pemerintah.

Give the information commission its autonomy to formulate guidelines through research, public consultations and discussion groups.

Let the parties argue their case before the information commission and courts and let the law evolve from this.

There are two reasons for this. First, it is because as I have argued above, there is much incentive for the government to be secretive.

The bureaucracy has an inevitable interest toward opacity in the interest of sustaining corruption and
collusion.

It is not likely that they can be expected to produce what Justice Brandeis termed above as a “disinfectant”. Thus, it is necessary to bring the law down to the people.

Second, learning from abroad, disclosure cases are settled on a case-by-case basis. The general principal only arises after factual cases are presented and argued before a tribunal.

Even up until today, there has been no one set of methodology for information commissions in other countries in balancing public interest in exemption clauses.

The idea of the FoI law is to allow the governed to observe clearly government operations that are otherwise performed in secrecy.

 
The writer is the founder of the Center for Law Information (CeLI).

via thejakartapost.com

My latest op-ed in JP.

 

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The human right to water is not a property right

Sunday, April 11, 2010

Recent developments in the right to water saga points out the unlikelihood of the human right system to pinpoint the exact amount of litres as the 'minimum core' on the right to water. Instead, the system leans towards 'reasonableness' approach. According to the Water Law Blog:

Thus, the ex ante standard setting required by the materialisation of a determinate minimum core for human rights to water inevitably leads to the theoretical acceptance of exceptional situations where more water than actually required to cover basic human needs must be provided to a specific individual, BUT ALSO to situations where less water that actually required to cover basic human needs will be provided to a specific individual.

I can't agree more with this approach. The human right to water is not a property right. Property rights follows a 3D rule: defineable, defensible and defeasible. If you want to sell me a land, your certificate better show me the exact boundaries of your property, and that no lien, mortgage or any other forms of encumberances follows. Thus, property rights must be exactly defined. But human rights is anything near that. Even with negative rights. You may ask, how defineable is the freedom of speech? Depends on where you live. If you live in Texas, you can burn any effigies and insult any deities you like. 

The human right to water is exactly like that. Fifty litres per day will make you a dignified person in New York or in London. But if you choose to live a nomad life like the Touareg or the Bedouine, perhaps 50 litres per day won't make your camel go anywhere.

 

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Untitled


This announcement below is from Foresight Institute.

Foresight Update 23.39: All conference videos now posted - April 9, 2010

  

Discuss these news stories at http://foresight.org/nanodot.

We are happy to announce that all videos from Foresight 2010, our January conference, are now posted: http://www.vimeo.com/album/176287

There are 17 videos, so in case you'd like some guidance in getting started, consider starting with the top three talks as rated by conference participants:

Special thanks to Monica Anderson, Miron Cuperman, and TechZulu (Efren Toscano) for their work on this project.

If you enjoy the videos and have not yet joined Foresight or donated in 2010, we encourage you to chip in and help fund this work: https://www.networkforgood.org/donation/MakeDonation.aspx?ORGID2=770119168

We hope to see you at the next Foresight Conference!






 

 

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Posted via email from movanet's posterous

 

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Religious Freedom in Indonesia Before and after Constitutional Amendments

Saturday, April 10, 2010

After asking permission to the editor, I decided to revise my paper, previously published in a book by Brainbow Press.  The working paper version is available in the SSRN. Abstract is provided below. Do send me email/post some comments. 
 
Download here, or read this SSRN page http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1587256
 
Religious Freedom in Indonesia Before and after Constitutional Amendments

Abstract:     
The Indonesian Constitution is very unique in terms of its relation between religion and the state. It is stated there that that the state is based “…on the belief in the One and Supreme God” but at the same time, it never explicitly mentioned the name of any established religion. Historical interpretation into the constitutional drafting process and revelation from the founding fathers on their understanding of 'God' and religion reveals that the Constitution is neutral with respect to religions and worldviews. However, the Constitution does prefer a theistic worldview over the non theist. The consequences for this is that the state may provide financial and other supports to the followers of religions (provide positive discrimination) but must not interfere with the freedom of followers of any other worldviews to profess their beliefs. Recent amendment to the Constitution reinforces this neutral stance. This would have a significant impact on the constitutionality of blasphemy laws. 
 
Keywords: indonesia, religion, blasphemy, human rights, constitution 
 
Working Paper Series

 

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UN Water Quality Reader

Wednesday, April 7, 2010

Quick blogging.

Click here for the links to publications by UN Bodies on Water Quality issues.

 

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EPSCA 10 list of speakers (update 2)

Tuesday, April 6, 2010

To give you an update, this is the list of speakers for the upcoming EPSCA 10:

  1. Dr. Evita Legowo, Director General Oil and Gas, ESDM (tent.)
  2. Trijana Kartoatmodjo, Deputy Operations, BPMIGAS
  3. Benny Lubiantara, Fiscal Policy Analyst, OPEC (as Advisor)
  4. Tariq Shafiq, Founding Executive, Iraq National Oil Company (also author of new Iraq oil law, Forum Chairman)
  5. Ittiporn Boonpracong, Deputy Director-General, Department of Treaties and Legal Affairs (Malaysia-Thailand Joint Authority)
  6. Faiz Shahab, Commissioner, PT Prime Petroservices
  7. Joseph Amudi Tobing, Senior Legal Counsel, Hess Limited
  8. Peter Godfrey, Vice President (Commercial), Arrow Energy International (on CBM development with PT Medco)
Click here to download the brochure. In order to claim 10% discount from indolawreport, fill in this promotional code  “82410PM-ILR-4Q" in the booking form.

 

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Another 149 companies may be implicated in tax crime?

Monday, April 5, 2010

According to the Jakarta Post:

There are at least 149 companies with tax issues related to Gayus, lawmaker Bambang Soesatyo said Thursday after a meeting with National Police chief Gen. Bambang Hendarso Danuri.
“I have a list [of the problematic firms]. They relate to Gayus’ case, as indicated by Gayus’ bank account transactions,” Bambang said as quoted by Antara. He said the case, which involves Rp 28 billion (US$3.08 million) in Gayus account, was only a part of a larger crime.
Gayus is likely involved in tax crimes along with hundreds of companies, Bambang added.
Chief detective at the National Police Comr. Gen. Ito Sumardi said his detectives had begun investigating into hundreds of companies that evaded tax with Gayus’ assistance.

Yesterday, Adnan Buyung has agreed to take on the case on the condition that Gayus opens up. Today, detikcom quoted Constitutional Court chief judge Mahfud MD saying that there is another major corruption case 'ready to blow'. 

Looking at the list, some of the 149 companies are indeed giant businesses with strong political connections.
What do you think?

 

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Water Governance in Malaysia

A new paper from Chan (2010) about water governance in Malaysia argues the importance of stakeholder participation, transparency and accountability. Chan opined that the current move towards the centralisation of water services provision in Malaysia should be reconsidered as it well have an impact towards participation and transparency in the water services sector. 

Below is the abstract:

Currently, it is widely believed that many water companies are linked to powerful politicians, making the awarding of contracts, tariffs and other management aspects non-transparent and ineffective. Ideally, politicians that govern should act on the professional advice of the water managers and not the other way around. Another area of water governance that needs to be intensified is the war against corruption. In the water sector, there should also be an all-out war on corruption at all levels of governance, in both the public and private sectors. Government should make all contracts in the water sector awarded through open tender with public consultation to ensure professionalism, fairness, transparency, accountability and good governance. Equally, all contracts and other relevant documents drawn up between the government and private companies should not be "classified" but instead be public documents available to the public for discussion, review and improvement. Another area to ensure better governance is for the government to engage and actively involved all stakeholders in the water sector, especially civil society and NGOs. Finally, the Federal Government should reconsider its plans to centralize the water sector by taking it over from State Governments. This is because, centralization would be contradictory towards involvement of all stakeholders and also pose problems to many states that had already privatized the water sector. Finally, governance of the water sector should be based on Integrated Water Resources Management which is the logical way forward in ensuring sustainable development. 

In my paper for the Journal of Water Law (forthcoming), I discuss in specific the problem of transparency in the water sector and explore how institutions and legal framework could tackle them. I agree with Chan that tarrifs, contracts and tender should be transparent. At page 151 he argued:

To achieve the above objective, the government should make all contracts in the water sector awarded through open tender with public consultation. This would ensure professionalism, fairness, transparency, accountability and good governance. Equally, all contracts and other relevant documents drawn up between the government and private companies should not be “classified” but instead be public documents available to the public for discussion, review and improvement.

The condition is similar in Indonesia. In my March 30th newspaper article, I wrote:

When a Jakarta citizen asks to what rights are they entitled as a water customer, there’s not much that the 1992 and 1993 bylaws can answer because the 1998 privatization has changed the landscape of accountability from Jakarta’s local government and PAM Jaya to its concessionaires.

Some of the answers could be provided in the concession contracts. Unfortunately, the concession contracts are said to contain a confidentiality clause and therefore are never to be found in the public domain.

It appears that both Malaysia and Indonesia faces similar problem with respect to the transparency of contracts and operations. Fortunately, Indonesia have a Freedom of Information Law which will be enforced starting from next month and we do not have (yet-- and hopefully never will have) an Official Security Act  (OSA). I red in Malaysiakini that some of the water deals are actually covered by OSA. 

Read Chan's full paper here. 





 

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Why busy with the right to water instead of 'governance'?

Saturday, April 3, 2010

Right to water skeptics normally pose this typical question: Why the right to water instead of governance?

Here's a short answer: you can't go to the court asking for good governance.

Illustration:

If you are disconnected from the services, you can't say to the judge:

"For the sake of good governance, please, reconnect me to the network."

compare with this statement:

"There is a human right to water in the constitution, I should, at least be permitted to pay in arrears, the disconnection is illegal."
 
Put it simply, the right to water creates rights and obligations. It can even create obligation for a good water governance. Remember, governance does not stand by itself. One of the indicator is the rule of law.

 

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The Pertamina Bribery Case: R v Innospec Limited

As you might be aware, the Indonesian Commission for the Eradication of Corruption (KPK) recently investigated the alleged bribery of former Indonesian's Pertamina (State owned oil company) top officials for delaying the enforcement of TEL-free gasoline policy and securing the TEL supply contract to Pertamina. 

The bribery was allegedly conducted by Innospec subsidiary in Indonesia through a series of ad-hoc funds and financial engineering. Some of the important points in the UK's Serious Fraud Office document:
65. It is not known how many ad hoc funds there were, nor responses for one off payments, though there is reference to a number within documentation provided to the SFO by Innospec. These additional payments were variously referred to as the “Lead Defense”4 fund; “Lim WS account”5; “compensation fund”6; “extraordinary costs”7; “cumulative costs”8; “special funds”9; “promotion fund”10 or “exceptional promotional work”11; “special bonus”12; “cranes” 13 and the “Rachmat Sudibyo fund”.
 66. This fund was conceived and largely operated during a period predating the Indictment. In the first instance between 2000 until his departure in August 2002, a recipient of ad hoc bribes was Rachmat Sudibyo (“Sudibyo”). The “Rachmat Sudibyo Fund” was a corrupt vehicle to pay Sudibyo, the Indonesian Director General of Oil and Gas at the Ministry of Energy and Mineral Resources. He was in post until August 2002, whereupon he was appointed Chairman of BPMigas – the newly established oil and gas authority.
69. The Special Committee retained KPMG to examine all payments made to PTSI. KPMG found two large payments, one in 2001 ($265,000) and one on 8 January 2002 ($295,150) with invoices stating that they were: “For payment all Pertamina/Migas & Lemigas Personnel (sic) travel, hotel, daily expenses overseas during the year 2001 spent in promotion of OCTEL’s products, as earlier agreed.”.

76. Innospec’s agents therefore made corrupt payments to public officials at Pertamina which were not dependent upon or related to specific orders for TEL being made. Corrupt payments were made as general sweeteners “to clear the air”, through various mechanisms including the agents’ general commission, to “buy of [sic] some Pertamina people”, to maintain or increase market share.

77. Furthermore, Innospec’s agents also requested further funds in order to make corrupt payments to a rival agent – Wisnu – who had apparently been tasked with marketing Chinese-sourced TEL to Pertamina.

83. In 2003 and 2004, Innospec’s agent, Sebastian, targeted Suroso, who became the Refinery Director of Pertamina. It is believed that this position was second only to the President or CEO of Pertamina. In effect Suroso had authority, at least until 2005, to sign and agree purchase orders on behalf of Pertamina. Even after the creation of MIGAS, individual refineries and Pertamina more generally had certain autonomy to enter into contracts with particular suppliers.


Read the full document at the SFO's web here.


The UK's Innospec had pleaded guilty to the offence. The UK's DoJ is currently carrying criminal investigation into the matter.





 

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What do we mean by 'regulatory governance'?

Thursday, April 1, 2010


The origin of this whole governance debate can be found in the 'grandfather-paper' of this topic written by Levy and Spiller (1994). The 1994 paper distinguishes "regulatory content" (as in technical regulation dealing with the input, process and output) from "regulatory governance arrangement "which focuses on restraining the regulator's discretion. The governance arrangement deals with among other, how predictable the regulatory law is and the track record of the courts in hearing and settling disputes impartially. So the focus of the governance debate is on the commitment of the state in regulating and in constraining the discretion of the regulator. It appears to me that the focus is more on the investor side of the regulation, and not really on the consumer side. 

When privatization was carried out in the UK during the 90s, experts considered that in practice, it is hard to stick to the black letter of the regulatory mandate. The mandate, according to them, has to be continuously reinterpreted. In fact, as we can see many English legislation, regulatory mandate always contain some 'public interest' clause, which broadens the scope of discretion.

Legal scholars such as Graham and Prosser thus considered that the regulator is responsible for, not only in performing regulation in technical sense, but also in furthering social objectives. This duty is both implicit (such as found in the public interest clauses) and explicit in the regulatory mandate. 

Back to the governance debate.

When Levy and Spiller (1994, above) argued that regulatory governance is primarily about restraining regulatory discretion, 1997 papers onward (for example, this one) considered that some discretion is inevitable instead, especially when it comes to the regulation of industries with rapid tech-changes. Of course, these papers still focus on the investor protection side of the debate. 

However, recent literature on governance pays more attention to the consumer side of the regulation, rather the investor side. Consider for example, Dunleavy's seminal paper "New Public Management is Dead -- Long Live Digital Era Governance" which argued that people are no longer a passive recipient of a public service, but also an actor and a partner. Other literature argued that the case where customer has no say on how the store is run, is no longer the trend. Disempowering customer from regulation has, in many instances, produces failures. For example, a steep increase in water tariff results in inability to pay. Inability to pay leads to disconnection. Disconnection leads to unpaid investment (in installing water meters and extending  pipelines to household) and in water theft. Water theft and unpaid investments leads to even higher tariffs. Finally, in the end of the day, the whole system collapse. 

Thus, the literature suggests the shifting trend from customer paradigm-- where they are a passive recipient of the service into citizen paradigm, where people are involved in the decision making process in service delivery (for example, in setting tariffs). How this is done (see paper), is through accountability, transparency and participation mechanisms. This is the new focus of the recent regulatory governance debate.

 

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What is the best indicator for a regulatory transparency?

Wednesday, March 31, 2010

Gutierrez (2003, paper here) tried to come up with an operational elements of regulatory governance.  He considered that autonomy and independence should be reflected in financial and budgetary independence and no free removal of commissioners; accountability is reflected through clear mechanisms for solving disputes, while clarity of roles and objective is manifested through the regulatory authority’s ability to impose fines and set tariffs. Finally, he opined that "..transparency and participation are operationalized by the existence of hearings for the setting of tariffs and other issues" (see pages 18, 19 and 24). 

However the argument that public hearing is the best proxy in determining regulatory transparency was disputed by Stern and Cubin (2003, paper here), who argued that it is too american-centric. Stern and Cubin argued instead that the requirement for regulator to publish their decision is the better proxy.  

Now the hard task for lawyers is in translating this into a legal concept.  First we need to choose which one is the best proxy. Should we obligate public hearing, or instead, it is adequate for the legal framework to require regulator to explain and justify their decisions? The devil will of course be found in the detail. Public hearing without adequate information disclosure is a non-sense. The legal requirement to explain and justify decision is also not clear in itself unless it is detailed further on how this should be performed.  



 

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RI water services suffering from a lack of governance

Tuesday, March 30, 2010

Below, I repost my article at today's JP. 
RI water services suffering from a lack of governance

Mohamad Mova Al ‘Afghani ,  Dundee, UK   |  Tue, 03/30/2010 9:48 AM  |  Opinion
From more than 300 water utilities currently operating, only a quarter is said to be financially healthy. The rest is either suffering from high debts or continuously failing to be able to cover its costs.

Meanwhile, the population keeps increasing and the quality of water from surface and groundwater sources is rapidly decreasing due to deforestation, pollution, saltwater intrusion and other problems caused by climate change. Experts are pessimistic that Indonesia will be able to achieve the Millennium Development Goal (MDG) target on water by 2015.

What is the real problem in the water services sector? There are funds out there ready to be invested by the private sector, but yet, most private sector participation in the water sector is failing.

Water is also abundant in this country, but in the form of floods or waste. Many reports consider that the real problem is not the lack of financial or natural resources, but the serious lack of governance.
 
Given the seriousness of water for our daily lives, it is a pity that we do not have any single national legislation dedicated specifically to managing water services.

The reason for this is partially because of regional autonomy, that those are the duties of local governments. 

Has local government paid enough attention to governing water services? No. What I hear most is the fuss about regional bylaws regulating the decency and morality standards of their citizens, such as those related to gambling, prostitution, alcoholic beverages or women’s clothing.

I am not suggesting that public morality cannot be regulated. It’s just that in terms of priorities, we are certainly losing our sight. There are obviously more people dying and ill because of waterborne diseases rather than from gambling or prostitution.

It is the lack of access to sufficient and safe water which contributes to the escalation of criminal and socially immoral activities.

Within the world of water activism itself, the debate is often sidetracked. In Indonesia, people tend to always debate between public versus private ownership of water utilities. I think they are asking the wrong question.

We know so much about the failure of privatization but yet so little about the success of public water utilities. So the real question should be aimed toward a solution: What governance mechanisms work for either public or private water utilities? In what circumstances can water be privatized and in what circumstances is a public ownership desirable?

This sidetracked debate has contributed to a bitter reality, that is, that both privatized and nonprivatized services develop without adequate governance.

Jakarta, for example, which has a population of more than 10 million in daylight, is regulated through bylaws enacted in 1992 and 1993, way before privatization (by way of concession) was carried out in 1998.

These bylaws are poorly drafted and do not reflect the need to incorporate post-privatization reality. What is happening now is that, in practice, Jakarta drinking water services are regulated mainly through concession contracts.

This fact is appalling because water is a political good that contracts alone are never enough to regulate.

When a Jakarta citizen asks to what rights are they entitled as a water customer, there’s not much that the 1992 and 1993 bylaws can answer because the 1998 privatization has changed the landscape of accountability from Jakarta’s local government and PAM Jaya to its concessionaires.

Some of the answers could be provided in the concession contracts. Unfortunately, the concession contracts are said to contain a confidentiality clause and therefore are never to be found in the public domain.

On the other hand, a citizen in Bogor can obtain clarity that they are entitled to a discount and even exemption from payments if their water utility delivers substandard services because Bogor municipality enacted a bylaw in 2006, stipulating the rights and obligations of the customer.

This is not to say that Bogor’s water services bylaws are perfect as there are many clauses which need amendment.

This is to say that when local government has a strong will to govern water services, it can.

Currently, there are several other water services cooperation, concessions and joint ventures taking place or being planned, oftentimes with the support of International Financial Institutions (IFI).
Reading their reports, I am skeptical that enough attention is given toward transparency, accountability and participation, all of which constitute an important element of governance.

Some reports even modeled water services as a sale-and-purchase transaction like other ordinary goods, whereby the Regional Water Company (PDAM) bought water from the private sector and re-sold it to customers, away from the scrutiny of local parliament and other accountability mechanisms. 

If this is the way to go, then we are doomed to another failure because no privatization is ever successful without proper regulatory governance.

If local government wishes to privatize, they should tightly regulate the private sector. No contracts can be above the law, especially when it comes to an essential element of human life such as water.

If they don’t regulate, they will soon realize that they will lose control. Prices rising, taps not flowing, no investment made to extend the network. 

When this happens, the citizens will come after them to demand responsibility. If they find no favorable answer, they can start taking matters into their own hands, such as by stealing water from the network.
This, in turn, will raise the burden on those who actually pay the price. If the local government decides to terminate the contract, the private sector will threaten to use international arbitration.  

Thus, local governments should start establishing the framework for transparency, accountability and participation through regional bylaws. If the services are to be privatized, they must ensure prior consent from the citizen.
Contracts should be available in the public domain, rights and duties of both customer and the service provider should be stipulated under bylaws, complaint mechanisms should be set up, redress should be available to customers, service levels and the consequences of violations thereof should be
established.

No contracts can be above the law, especially when it comes to an essential element of human life such as water.

The writer is a PhD candidate at the UNESCO Centre for Water Law, Policy and Science at the University of Dundee, UK.

 

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Legal System and Governance Transparency

Friday, March 26, 2010

Bushman, Piotroski and Smith (2004) distinguished between two elements of Corporate Transparency: Governance Transparency and Financial Transparency. The factors of financial disclosure are segments, r&d, capex, accounting policies and subsidiaries. Meanwhile, the factors of governance disclosure are major shareholders, management, boards, director and officer's remuneration and officer's shareholdings.

The results of their study is very interesting. They found that financial transparency is correlated with political economy, while governance transparency is correlated to legal systems. Financial transparency is higher in states where state ownership of enterprises and bank is low while governance transparency is higher in common law systems compared to civil law tradition.

One of the explanation for this result is because governance transparency is highly dependent of efficient judicial system and legal framework, and it appears, civil law countries are not that efficient with respect to their judicial system. 
 
On the qualitative side, it will be interesting to evaluate if legal frameworks in civil law countries are -- independently of the efficiency of their judicial systems -- adequate with respect to corporate reporting.  It would also be interesting to see if this situation in civil law tradition can be rectified using both mandatory and voluntary disclosure policies combined with incentive.
 


 

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[RTWS Update] Consultation on the Human Right Aspects of Private Sector Participation in the Water Sector: more responses from the private sector

The UN Independent Expert launched a consultation a few months ago regarding the human rights aspects of private sector participation in water services. As of today, several companies including Suez, Veolia and American Water had sent their responses. Reading the consultation responses, I feel that there are growing anxiety from the private sector that the Right to Water movement will use human rights instrument to outlaw private sector participation from the water services sector. 

This view is incorrect and absurd. It is not possible for the human rights system to dictate on a specific ownership model. The stance of RTWS with respect to private sector participation is already clear from the General Comment 15: there is a state duty to regulate. Hence, when it comes to PSP, the only question is what and how to regulate.

To read more on the responses, click here.


 

 

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[RTWS Update] Two Misconceptions about the Human Right to Water (Part 1)

Thursday, March 25, 2010

David Zetland wrote:

To understand the costs, begin with the difference between negative and positive rights. Negative rights (e.g., the right to free speech) should not be taken from you; positive rights (e.g., the right to “clean and accessible water, adequate for the health…") should be given to you. We can immediately see that it is easier to protect negative rights from violation by an outsider than positive rights, which as violated by a lack of action. Even worse, we cannot tell when action, of a certain quality, quantity or price, is enough. Finally, consider that the cost of positive rights grows with demand (e.g., population); it costs nothing to supply an increased demand for negative rights.

First Misconception: The Right to Water is a 'positive' right. 
The distinction between positive and negative rights stems from political discourse, such as that of Isaiah Berlin who distinguishes between positive and negative liberty. Human Rights Courts, such as the ECtHR have argued that human rights provisions have both a 'positive' and 'negative' aspects. The right to life cannot be realized without the state's duty to provide protection. The right to vote is meaningless without the ballots and the infrastructure to support an election. The right to property is a blank cheque if the police is not well supported to enforce the law.

If one day you got robbed in a State, because that State would rather invest on something else rather than paying sallaries to its police officers, what does it mean to you to have the right to property? If the right to property only means a 'negative right' which, as Zetland suggests, requires the state only "not to do anything", then it is sufficient for that state to enforce the right to property by not robbing you. Under this conception, as long as they don't steal and rob from you, no human rights is breached. This means that you can't come to the Court and ask the state to provide funds for the police force.

On the contrary, the right to property also has some positive elements. Not only that it means that the state cannot take away your property (the negative aspect) without due process and compensation, it must provide all available means to protect your property (the positive aspect), for example, by having a police force. 

The right to water is also like that. It has both positive and negative elements. The negative element obligates the state not to interfere or impede your access to water, the positive one obligate the state to enact regulation, or, in certain cases, to deliver the water, if public ownership is opted by the state as a mode of delivery.  







 

[RTWS Update] Does Human Rights to Water Improve Access to Clean Water?

Tuesday, March 23, 2010

Prof Zetland argued in his paper that the right to water does not improve access to sufficient and safe water (download paper here):

Some argue that a *human right* to clean water would improve this situation. This paper shows that human rights have not improved access to clean water and argues that it would be more productive to give people a *property right* to water. Because property rights - unlike human rights - are alienable, some portion of an individual's rights can be exchanged for access to clean water. 

In his paper, he distinguished between countries which --de jure-- constitutionally acknowledge the right to water and those which do not. He found that states which incorporate human right to water does show a marginal percentage of two percent increase in terms of access compared to states which do not provide right to water in its constitution. However, upon a careful analysis by looking at the rate of access before the countries amended their constitution, he found no correlation between such phrase and the increase of access. He argued that the access increased because of the number shown in the previous year.

My concern stems from his distinction: which states acknowledge human right to water and which states does not, which leads to his conclusion: that human right to water does not deliver. I do not think it is right to suggests that states does not acknowledge right to water simply because it is not explicitly mentioned in the constitution. Indonesian constitution contains no explicit provision recognizing the right to water. However, the Constitutional Court does recognize right to water by inferring it from other rights. Hence, de jure, Indonesia too, recognize the human right to water. States which are members to the ICESCR too, to a certain extent, acknowledge the right to water.

Second, is his distinction between human right and property right to water and its subsequent application. He argued that explicitly mentioning right to water in the constitution does not guarantee any delivery. By the same token, we can argue that explicitly mentioning the guarantee of property rights in the constitution does not guarantee any delivery. One needs a governance system and a rule of law to enforce property. Let me quote the words of an extreme right-winger, the Nobel Prize Winner Milton Friedmann:
It turns out that the rule of law is probably more basic than privatization. Privatization is meaningless if you don't have the rule of law. What does it mean to privatize if you do not have security of property, if you can't use your property as you want to?

The same thing exactly applies to the human right to water. If property rights does not work without rule of law and governance, so does the right to water. But more importantly, I categorically rejects the antinomy of human right to water and the property right to water. The essence of human right to water is also governance, except that it puts a little more weight on affordability. Human right steers development, but it does not in anyway dictates the constellation of ownership system within a particular state. What human rights does, is that it solves problems in context. No, it does not grants anyone access to free water. But it can give citizen a sufficient armoury in pressing for developments and give guidance to judges in solving water allocation problem, for example.




 

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The Bonn Charter for Safe Drinking Water

Friday, March 19, 2010

  According to the WHO website :

The IWA Bonn Charter for Safe Drinking Water sets out the principles of an effective drinking water quality management framework and the responsibilities of key parties. The Charter presents a framework for drinking water safety, which incorporates the development of water safety plans. The goal of the Charter is good safe drinking water that has the trust of consumers.

Click here to download International Water Association (IWA) Bonn Charter of 2004. The pfd links to this charter is broken in many websites, so the document is rather difficult to obtain online. Fortunately watsan.net kept a copy of it.

 

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E&P Sharing Contracts and Agreements 2010 (Update 1)

Tuesday, March 16, 2010

I have been informed that Tariq Shafiq, who is involved in writing the new Iraqi Oil Law will be joining the event. Here's the tentative schedule for the speakers for Day Two:


Plenary One | 09.00 - 10.45
The post-recession E&P industry agreements and the
challenge of recovery
Chairman’s Opening Remarks
Mr Tariq Shafiq, Founding Executive, Iraq National Oil
Company
Next-generation E&P engagement: Outlook for the world and
Asia in 2010
• To what extent will the downturn bring fundamental change
to the nature of E&P contracts in Asia and how will IOCs,
NOCs and service contractors respond?
• What are the bright spots and challenges for the service
contractors?
Ministry of Energy and Mineral Resources, Indonesia*
Transforming PSAs: Evolving contracting models and the push
to abolish the PSA
• Revisiting and transforming the original PSAs to more win-win
commercially viable arrangements
• What are the alternatives available to successfully transform a
PSC into a more economically viable contract?
Hardiono, Deputy Chairman, BPMigas*
Structuring advanced models of cooperation in the form of a
Joint Venture or Partnership
• What specifi c terms have to be adopted for safeguarding your
agreements and ensuring successful collaboration?
• How changing roles of IOCs and NOCs contribute to the
shape of the partnership agreement and what you should
expect?
Ms Karen Agustiawan, President Director, Pertamina*
Revising ineffi cient contracts: Holistically reducing
uncertainties from E&P projects
• Evaluating alternatives under different scenarios, i.e. reserve
discoveries, variations in oil prices, operating costs, and fi eld
development
• Cost recovery system and ‘excess profi t’ adjustment
mechanism
• Hedging against exploration uncertainties of no discovery,
discovery not being commercial and costs
• Hedging against production uncertainties, derived through
operating costs and commodity prices fl uctuations
Mr Joseph Amudi Tobing, Sr Legal Counsel, Hess Limited


Click the latest brochure to get more detailed information on the list of speakers and venue.

Another good news: the reader of this blog may get 10% discount. I am still working on the arrangements with the organizers.

 

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Google's exit and the Great FireWall of China

Monday, March 15, 2010

According to news agencies, it is very likely now that Google will exit China. A recent interview in the BBC revealed a targetted attack to gmail account owned by Chinesse Human Rights activists.

Will this triggers the creation of a new web-block? Will the future of the Chinese Web goes different way from the mainstream Internet? The Berlin wall did collapsed but the great firewall remains because the firewall has no direct effect on the Chinese economy. 

This could be the beginning of an entirely new internet culture.

 

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Sony -- don't take away my friend's name

Detik reported that Sony corp sent a sommation* letter to a blogger named Sony, for using sony-ak.com for his domain name. Now the blogosphere strikes back at Sony and organize a facebook group called 'Sony -- don't take away my friend's name'.


Will the wisdom of the crowd(ed) facebook beat Sony corp and its lawyers? We shall see.

Shall we name our cats Google and assign a domain name for it?

* I am not sure how to translate the term. There is 'Abmahnung' in German and 'Sommation' in French. Is Cease and Desist the equivalent common law concept?

 

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[RTWS Update] Questionnaire on Good Practices

Sunday, March 14, 2010

The UN Independent Expert on the right to water and sanitation recently launches a good practice questionnaire on the right to water and sanitation. If you have been or is involved in watsan related projects or is doing a research on watsan related policies, you are invited to make a contribution.

Read this page at the IE Water website to get a more comprehensive explanation. To download the good practices questionnaire, click here.

 

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RTWS Updates

To cover recent developments on the Right to Water and Sanitation, this blog launches "RTWS Update". The updates will contain news, issues, viewpoints and events related the right to water and sanitation. If you are not yet familiar with RTWS, please have look at the right to water web page here.

 

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E&P Sharing Contracts and Agreements 2010

Saturday, March 13, 2010

Center for Energy Sustainability and Economics will be holding a very important forum this April, in Jakarta. The E&P Sharing Contracts and Agreements 2010 will be held in Jakarta 27-29 of April 2010, and will feature important figures in the Indonesian Oil and Gas Industry. This is the press release I received from the organizer, Arcmediaglobal:


Insights into the most efficient partnerships, alliances, contracts and agreements adapted to today’s economy are why this Power Forum is a must-attend event for all exploration companies from Southeast Asia, Central Asia, Russia, Africa, the Middle East, Caspian Sea and other oil-rich regions. The forum brings together the institutions, regulators, commercial and state actors, all who are directly involved in actual contracts and sharing agreements, to shed light into business-critical and contract-related issues around the various relationships, fiscal models and risk management must-haves in today’s petroleum exploration and development, including production sharing, joint operations, joint ventures, service contracts, international boundary disputes and oil & gas accounting.


 I will update more on this event. Click here for brochure.

 

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World Water Day: Dee & Tweed HELP workshop (Live Broadcast)

Friday, March 5, 2010

The UNESCO Centre for Water Law, Policy and Science at the University of Dundee will be holding a workshop with a focus on land use and water management. Following is the release I received from the organizer: 

"The University of Dundee’s UNESCO Centre for Water Law, Policy and Science is takes a leap into the world of online conferencing for the celebration of World Water Day next month, on the 22nd March.  This event will be broadcast live via the internet, both through live audio-visual and a transcript of proceedings in real time.  Global participants to this free online event will be encouraged to provide immediate feedback to the conference speakers and organizers and to share comments with one another through an online forum facility.  The focus will be on the work of the UNESCO Centre in the Tweed valley, in particular the interface between land use and water management.  Comparisons will be made with other UK river valleys, in particular the Dee and the Thames.  The conference will showcase global water issues and the multidisciplinary work of the UNESCO Centre in promoting the importance of water law and hydrological science in helping to achieve more consensual and informed water policy and practice.  World Water Day was inaugurated in 1993, since when it has been a focus globally for action on water issues, including promoting fair and equitable access to transboundary watercourse and groundwater resources of freshwater."

 In order to participate in this online conference, please sign up below:



Events


For enquiries, please contact UNESCO Centre's Knowledge Exchange Coordinator Daniel Gilbert at d.gilbert[at]dundee.ac.uk

 

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Aardvark for Legal Research?

Friday, February 12, 2010

Google had recently acquired Aardvark, a social tool designed to post and answer question or consultations. The idea is pretty much like Ask Yahoo or Google Answer, except that Aardvark can search the right person in answering your question (that is, based on your profile). I have asked this question for example, and the answer is not bad. So, now I will ask another question in Aardvark. My question would be: how much is the average sallary in London for lawyers with around 4 years of experience?

I will update in another post if I have received favourable answer.