Alienating the 'Private' Sector: Implications of the Invalidation of the Water Law by the Indonesian Constitutional Court

Sunday, September 12, 2021

Journal of Water Law 26/3 (2019)

In 2015, the Indonesian Constitutional Court invalidated Law no 7 Year 2004 on Water Resources. At the heart of the Judicial Review was the extent of private sector’s involvement in Indonesia’s water sector and the effort to regain “state control” on water resources, as required by the Constitution. In order to realize “state control”, the Constitutional Court decreed that state owned and region owned enterprises should be prioritized in the management of water resources. Further, involvement of private enterprise should be restricted and is only possible after water is allocated to other priorities. Unfortunately the Court did not define what is meant by “private sector”. This paper criticized the decision and discuss its far reaching implications.

Keywords: water, law, indonesia, privatization, constitution, private, constitution, policy


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Konsep Regulasi Berbasis Risiko: Telaah Kritis dalam Penerapannya pada Undang-Undang Cipta Kerja

Monday, May 24, 2021


Undang-Undang Cipta Kerja menekankan pada kemudahan untuk melakukan usaha. Salah satu hal yang menjadi perhatian adalah penyederhanaan perizinan berusaha. Konsep Regulasi Berbasis Risiko menarik bagi program penyederhanaan perizinan karena diasumsikan bahwa penerapannya dapat mengurangi jumlah perizinan. Namun, penerapan analisis resiko untuk menapis izin merupakan sesuatu yang berbeda dengan penerapan konsep Regulasi Berbasis Risiko di negara-negara lain. Selain itu, penerapan regulasi berbasis risiko juga perlu memperhatikan kritik yang tidak terakomodasi dalam Undang-Undang. Tulisan ini menjabarkan 4 (empat) kritik atas penerapan regulasi berbasis risiko dalam Undang-Undang Cipta Kerja, yaitu (i) format omnibus merancukan penilaian risiko, (ii) risiko volatilitas belum dipertimbangkan, (iii) risiko sistemik belum dipertimbangkan serta (iv) potensi “regulatory capture”. Secara konseptual, penerapan regulasi berbasis risiko memantik diskursus akademik mengenai pengertian regulasi secara luas yang telah jauh berkembang dari pemaknaan sempit dalam wacana akademik di Indonesia yang mendefinisikannya sebatas peraturan perundang-undangan semata. 

Kata kunci: Regulasi, Regulasi Berbasis Risiko, Undang-Undang Cipta Kerja, Omnibus. 


The Law on Job Creation emphasizes the ease of doing business. One of the things that is of concern is the simplification of business permit. The concept of risk-based regulation is attractive to simplify the programs due to the assumption that it may cut off a number of licenses. However, the application of risk analysis to screen permits is something different from other countries. In addition, the application of risk-based regulations also needs to pay attention to the critique that is not accommodated in the Law. This paper describes 4 (four) critiques of the application of risk-based regulation in the Law, (i) the omnibus format confuses risk assessment, (ii) volatility risk has not been considered, (iii) systemic risk has not been considered and (iv) potential “regulatory capture”. Conceptually, the application of risk-based regulation has sparked an academic discourse regarding the broad understanding of regulation that has evolved far from the narrow meaning in academic discourse in Indonesia which defines it only as a statutory regulation. 

Keywords: Regulation, Risk Based Ragulation, Job Creation Law, Omnibus

Download paper disini.


Water Allocation Issues Under Law 17/2019

Thursday, January 28, 2021


CRPG released Policy Brief 01/2021: Water Allocation Issues Under Law 17/2019

Five issues on water allocation were raised: prioritization of drinking water utility, conflict between the same category of uses, groundwater and conjunctive uses, water footprint and the impact of jobs creation law.

Larangan Pendayagunaan Air di Wilayah Konservasi Mengancam Industri Geothermal dan Mikrohidro?

Tuesday, December 15, 2020

Policy Brief 01/20 CRPG yang berjudul "Larangan Pendayagunaan Air di Wilayah Konservasi Mengancam Industri Geothermal dan Mikrohidro?" dapat diunduh disini.

Pasal 33 UU 17 Tahun 2019 Tentang Sumber Daya Air (UUSDA) melarang pendayagunaan air di wilayah konservasi, kecuali untuk kebutuhan pokok sehari-hari bagi orang perseorangan. Pasal tersebut berbunyi: “(1) SetiapOrang dilarang melakukan Pendayagunaan Sumber Daya Air di kawasan suaka alam dan kawasan pelestarian alam. (2) Larangan Pendayagunaan Sumber Daya Air sebagaimana dimaksud pada ayat (1) dikecualikan bagi orang perseorangan untuk pemenuhan kebutuhan pokok sehari-hari yang tidak dimanfaatkan sebagai bentuk usaha.” Dalam Pasal 69 diatur bahwa pelanggaran atas ketentuan ini dapat berujung pada sanksi pidana berupa penjara sampai dengan 6 (enam) tahun dan denda sampai dengan 10 miliar rupiah.


Pemanfaatan air dalam KSA dan KPA misalnya, diatur dalam Peraturan Menteri Kehutanan Republik Indonesia Nomor P.64/Menhut-Ii/2013 Tahun 2013 Tentang Pemanfaatan Air Dan Energi Air Di Suaka Margasatwa, Taman Nasional, Taman Hutan Raya, dan Taman Wisata Alam (selanjutnya “P64/2013”). Dalam P64/2013, air maupun energi air dalam kawasan konservasi dapat dimanfaatkan, baik untuk kepentingan komersial maupun kepentingan non-komersial. P64/2013 menerangkan bahwa pemanfaatan air dan energi air dapat dilakukan pada blok atau zona di suaka margasatwa, taman nasional, taman hutan raya atau taman wisata alam, kecuali blok perlindungan, zona inti atau zona rimba. 

P64/2013 menginduk pada Peraturan Pemerintah Republik Indonesia Nomor 28 Tahun 2011 Tentang Pengelolaan Kawasan Suaka Alam Dan Kawasan Pelestarian Alam (“PP 28”). PP 28 dengan gamblang mengizinkan pemanfaatan air pada KSA dan KPA. Pasal 37 dari PP 28 secara eksplisit membolehkan pemanfaatan air dilakukan pada Taman Wisata Alam (Taman Wisata Alam sendiri merupakan bagian dari KPA). Sementara itu, Pasal 34 dari PP 28 membolehkan pemanfaatan air pada Suaka Margasatwa (Suaka Margasatwa sendiri merupakan bagian dari KSA). Lebih lanjut, dalam Pasal 40 PP 28/2011 ditegaskan bahwa “Ketentuan lebih lanjut mengenai pemanfaatan KSA dan KPA untuk penyimpanan dan/atau penyerapan karbon, pemanfaatan air, serta energi air, panas, dan angin diatur dengan peraturan Menteri.”

Risk-based approach in job creation bill lacks academic rigor

Tuesday, August 18, 2020

Risk,word,letters,boggle,game - free image from

Risk-based approach in job creation bill lacks academic rigor

The Jakarta Post, March 3, 2020

Mohamad Mova AlAfghani

Bogor. West Java 

Director, Center for Regulation, Policy and Governance (CRPG)

Despite the criticisms laid against the job creation bill, we need to commend the government for its courageous effort, not only to consolidate and harmonize around 70 laws, but also to introduce an overarching risk-based approach to our legal system. 

Most critics focus on two primary issues: (1) sectoral issues, arguments of which usually revolve around the “loss of protection”, be it for the environment, labor or certain aspects of human rights; and (2) procedural issues, with many criticizing the “omnibus” legislative process as lacking transparency.

However, few have paid enough attention to the risk-based approach used in the bill, even though this mechanism will fundamentally alter our regulatory system and may even raise question on whether it would be compatible with our Constitution.

Risk-based regulations require the government to prioritize regulatory burdens and resources toward “high-risk” activities. Risks, of course, constitute the “likelihood” and the “severity” of the potential impact of a particular activity: the higher the likelihood and the severity of the impact, the higher the risk.

The resources available to regulators for inspecting and monitoring are always limited. Thus, why spend taxpayer’s money on small risks? Regulations would be more efficient if resources are spent only on high-risk activities – or so the theory goes.

Indeed, the job creation bill follows this approach. Only high-risk businesses will require a license (Article 11) and the level of supervision depends on the level of risk: Hence, the higher the risk, the more intense the scrutiny. This sounds about right, except for the fact that theories on risk-based regulation have moved past this.

The bill overlooks two things that are addressed in the regulatory policy literature: volatile risk and cumulative risk.

The former refers to risks that could be high during a certain season but low during another. For example, theft and burglary in residential areas are volatile risks: They increase during long holiday seasons such as Idul Fitri when millions of people travel back to their hometowns, but are relatively low during normal days. Fortunately, these risks are predictable, so homeowners can hire additional security during Idul Fitri. However, other risks like those related to climate change may not be so obvious.

Other risks could be low or medium but they are actually systemic and thus, incur cumulative costs on society. Homeowners, for example, may park their second vehicles on a neighborhood street without permission. If we look at this individually, then the risk (in terms of severity) is low compared to truck owners who park their vehicles on the street. But if everyone does this (since a permit is not required), then the street will become clogged with vehicles and becomes a systemic risk.

We can see here that “locking down” regulatory resources and licensing only high-risk activities could be very dangerous, as this would mean that regulators will be legally required to ignore both volatile and cumulative risks.

The job creation bill contains a paradox: It aims to broaden the discretion of public officials, but the clauses in Articles 8 and 11 actually narrow it.

Targeting supervision to “high risk” (Article 11) also contradicts theories on regulatory policy. It is not always the case that high-risk activities must be exposed to intense supervision. Theoretically speaking, a risk-based regulatory approach shifts the burden of risk from regulator to the companies’ risk management system. In other words, if the companies manage their risks, no matter how high, the level of supervision can be reduced. This can be proven over time through their compliance records. Although this is the general rule, the UK’s Hampton Report of 2005 warned that random checks on historically compliant firms were still required.

Article 8 “locks down” the types of risk to several subjects: health, security, environment and natural resource use. Strictly speaking, anything outside of these four subjects are not considered a risk.

What if a certain cultural heritage might be lost due to certain business activities? Let’s say a traditional community holds a religious ceremony on a site they consider sacred, but the local government wants to build a shopping mall there. Is that activity not considered a risk? Unfortunately, no. If Article 8 makes it into law, then local governments can be legally forbidden from considering threats to cultural heritage as a risk.

This also shows that risk is a matter of perception. What constitutes a risk is different from person to person and from culture to culture. Whether a risk is deemed high or low can also differ from one person to another. Whether a risk is acceptable or not is also a matter of perception. The “risk” of risk-based regulation is that it may reduce regulatory activities into mere actuarial activities.

Another risk that risk-based regulations pose is the risk to public accountability. We cannot blame public officials from failing to address cumulative risks and other issues that are not considered a risk by law (such as the aforementioned cultural heritage).

In fact, risk-based regulations can be linked to bureaucratic incentives. For example, directorates and work units can be evaluated in terms of their budget. Have they used their budget “efficiently”, that is, in supervising only high-risk activities? If yes, then they are rewarded for their performance; if not, then they are penalized.

This can be dangerous, however, since officials are deliberately incentivized to ignore volatile and cumulative risks. Hence, “risks” can be used to measure the performance and budgetary accountability of a government unit, but at the same time, the government unit can evade accountability for activities that are not legally considered “risks”.

Finally, predetermining the types of risk in the bill (Article 8, point 3) will eventually cause confusion. In other countries such as the UK, risk identification always starts with a regulator’s interpretation of its statutory objectives (Black and Baldwin, 2012, Baldwin 2012), and “risks” are those issues that impede the attainment of those objectives. For the England-Wales water regulator (OFWAT), its objective is to “further the consumer objective”, and secondly to “secure … the functions of a water undertaker”. OFWAT then develops its risk-based approach for several items, from water shortages during drought to contamination and to burst pipes (OFWAT, 2015).

Therefore, in both the literature and practice, “risk” is determined by interpreting the statutes first and then detailing the subjects according to each agency’s regulatory objectives. OFWAT will thus have a different risk set compared to the telecommunications regulator OFTEL, for example.

Indonesia seems to be taking a different approach in the job creation bill, wherein the general types of risk are predetermined according to Article 8(3): health, safety, environment and natural resource use. If regulators actually experience certain risks in practice that do not fall into these categories, they will be overlooked. Our society will then bear the cost of this oversight. 

None of the above issues were discussed as far as the academic draft of the bill is concerned. The only relevant literature mentioned in the academic draft is the OECD’s 2010 “Risk and Regulatory Policy” report, which is wholly inadequate for a bill that could fundamentally alter our regulatory system.


Apakah Perawatan Transformator Merupakan Jalan Masuk Kontaminasi PCB?

Wednesday, July 15, 2020

Selepas fase Pembatasan Sosial Berskala Besar (PSBB) industri berangsur-angsur memacu kegiatan produksi hingga dapat beroperasi hingga kapasitas penuh. Transformator listrik sebagai jantung penggerak mesin produksi tentunya juga akan beroperasi secara penuh sehingga mungkin akan membutuhkan perawatan setelah non-aktif selama beberapa waktu.
Perawatan transformator yang tidak sesuai prosedur diduga dapat mengakibatkan kontaminasi senyawa Polychlorinated biphenyls (PCBs) terhadap transformator. Sebagaimana diketahui, senyawa PCBs telah dilarang di Indonesia. Merujuk peraturan perundang-undangan yang berlaku, transformator yang terkontaminasi PCBs wajib dibersihkan dan/atau dimusnahkan sebelum tahun 2028 sehingga tentu akan menjadi beban ekonomi yang tidak sedikit bagi industri. Mencegah kontaminasi tentunya jauh lebih mudah dan ekonomis daripada menangani transformator yang terontaminasi PCBs.
Center for Regulation, Policy and Governance (CRPG) bekerja sama dengan PT. Ecoverse Indonesia Lestari (ECOVERSE) dan PT. Hyprowira Adhitama mengundang industri, khususnya Senior Manajemen dari Divisi/Bagian Kesehatan dan Keselematan Kerja dan Lingkungan (K3L) atau Health Safety and Environment (HSE) untuk menghadiri webinar guna membahas kemungkinan kontaminasi PCBs pada transformator listrik pada saat perawatan dan upaya pencegahannya. Webinar ini menghadirkan pakar dan praktisi yang telah berpengalaman dalam hal perawatan transformator dan pengelolaan PCBs.
Webinar akan diadakan pada:
Hari/Tanggal   : Rabu, 29 Juli 2020
Waktu              : 09.00 – 12.15 WIB
Link Registrasi :

Webinar ini tidak dipungut bayaran (gratis).

Jalan Rekonsiliasi AHY

Wednesday, June 5, 2019

Jalan Rekonsiliasi AHY
Mohammad Jibriel Avessina
Analis Perilaku politik 

Momen kunjungan silaturahmi Agus Harimurti Yudhoyono (AHY) ke rumah Megawati adalah peristiwa sosial yang menarik untuk disimak.  Apalagi, hal ini merupakan aktivitas kunjungan yang pertama dilakukan AHY, selepas ziarah ke makam Ibunda Ani Yudhoyono, yang baru saja wafat pada 1 juni 2019 yang lalu.

Pilihan AHY untuk menempatkan prioritas kunjungan silaturahmi pada rumah Megawati pada hari pertama lebaran, sarat akan makna. 

Kunjungan ini menegaskan penghormatan AHY pada Megawati sebagai Ibu bangsa,dihormati seperti layaknya orang tua sendiri. Ada penghormatan atas perannya pada sesepuh bangsa

Padahal, relasi SBY-Mega selama SBY  sepuluh tahun menjabat dianggap oleh publik relatif dingin. Persepsi ini muncul, sebab keduanya jarang tampil bersama dalam acara publik.

Tetapi, persepsi tersebut rupanya tidak tepat . Kunjungan AHY ternyata berlangsung dengan hangat,guyub dengan semangat kekeluargaan, tak ada bekas guratan konflik.

Kegiatan merajut silaturahmi baik pada sesepuh bangsa maupun kalangan muda dalam komponen bangsa ternyata merupakan watak khas AHY.

Figur AHY misalnya tidak ragu untuk sowan pada tokoh tokoh bangsa senior.  AHY juga rajin melaksanakan silaturahmi pada putra dan putri presiden dan mantan presiden. Kiprahnya dalam merajut silaturahmi terlihat, AHY ikut ambil bagian dalam deklarasi bogor, yang diinisiasi oleh 9 tokoh muda bangsa.

Sebagai pemimpin muda, AHY memberikan teladan, _to lead  by example_ tak banyak kata kata yang diucapkannya, tetapi tindakannya menjadi contoh bagi kita.  Dari kiprahnya kita tahu, AHY merupakan kualitas yang relatif jarang dimiliki anak muda kita: Cerdas, Santun, rendah hati dan punya komitmen kemanusiaan. 

Sebagaimana wejangan yang selalu diucapkan oleh almarhum Gus Dur pada kita, diatas politik ada kemanusiaan.