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Web alert: Indonesian Mineral Ore ban update

15 January 2014

Further to our web alert “Indonesia law on export of raw minerals to be enforced from 12 January 2014”:

Indonesian media reports suggest that despite rumours that the ban would be relaxed, the law 'No.4/2009' has come into effect.

Last minute amendments to the law have eased the restrictions on the export of copper, manganese, lead, zinc and iron ore. Bauxite and nickel ore however are still subject to the ban in its entirety. This amendment is a temporary measure designed to allow time for major mining companies to build the required smelting facilities before a deadline of 2017. From 2017 onward all minerals exported from Indonesia must be fully refined.

Vessels have recently been detained at Indonesian ports after the completion of loading and departure procedures because they were unable to obtain port clearance. These detentions appear to have been related to the mineral ban, questions existed as to whether the cargo carried onboard was legal.

Parties should thoroughly research any ore cargo due to be loaded in Indonesia, Charterers should check with shippers and owners should impress upon their charterers the need to do so. Research into the nature of the cargo and its implications should be made as far in advance of the vessels arrival in Indonesia as is practicable to avoid delays.

Further information from Reed Smith.