PREAMBLE

Regulation of The President No.77 of 2018-Hukumonline

REGULATION OF THE PRESIDENT OF THE REPUBLIC OF INDONESIA

NUMBER 77 OF 2018

ON

THE MANAGEMENT OF ENVIRONMENTAL FUNDS

BY THE GRACE OF GOD ALMIGHTY

THE PRESIDENT OF THE REPUBLIC OF INDONESIA,

Considering:

that in order to implement the provisions of Article 30 paragraph (3) of Regulation of the Government Number 46 of 2017 on Environmental Economic Instruments, it has been deemed necessary to establish a Regulation of the President on the Management of Environmental Funds;

Observing:

1. Article 4 paragraph (1) of the 1945 Constitution of the Republic of Indonesia;

2. Law Number 32 of 2009 on Environmental Protection and Management (State Gazette of the Republic of Indonesia of 2009 Number 140, Supplement to the State Gazette of the Republic of Indonesia Number 5059);

3. Regulation of the Government Number 4õ of 2017 on Environmental Economic Instruments (State Gazette of the Republic of Indonesia of 2017 Number 228, Supplement to the State Gazette of the Republic of Indonesia Number 6134);

HAS DECIDED:

To establish:

REGULATION OF THE PRESIDENT ON THE MANAGEMENT OF ENVIRONMENTAL FUNDS.

Article 1

Under this Regulation of the President, the following definitions are employed:

1. Management of Environmental Fund is a system and mechanism that are used to fund efforts to protect and manage the environment.

2. Environmental Pollution and/or Damage and Recovery Mitigation Fund is fund prepared by the Central Government and/or Regional Governments to mitigate and restore environmental pollution and/or damage.

3. Trust Fund/Conservation Aid is fund that is originated from grants and donations for the benefit of environmental conservation.

4. Custodian Bank is a party that provides safekeeping services for securities and other assets related to

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securities and other services including receiving dividends, interests and other rights, settlement of securities transactions and representing account holders who are its customers.

1. Collection of Environmental Pollution and/or Damage and Recovery Mitigation Fund is an activity to collect fund to be managed and distributed in accordance with an assignment and/or a contract/an agreement.

Article 2

(1) The management of environmental fund shall be carried out through the following activities:

• fundraising;

• establishment of fund; And

• distribution of fund.

(2) The management of environmental fund as referred to in paragraph (1) shall be carried out based on the

principles of:

• transparency;

• efficiency;

• effectiveness;

• proportionality; And

• accountability.

Article 3

The fundraising as referred to in Article 2 paragraph (1) letter a shall include:

• Environmental Pollution and/or Damage and Recovery Mitigation Fund; And

• Trust Fund/Conservation Aid.

Article 4

(1) Fundraising in the form of Environmental Pollution and/or Damage and Recovery Mitigation Fund as

referred to in Article 3 letter a shall originate from:

• The state revenue and expenditure budget;

• The regional income and expenditure budget; and/or

• other sources of funds that are legal and non-binding in accordance with provisions of laws and regulations.

(2) Sources of funds as referred to in paragraph (1) may come from environmental taxes and levies.

(3) Fundraising in the form of Trust Fund/Conservation Aid as referred to in Article 3 letter b shall originate

from grants and donations.

(4) Sources of fundraising as referred to in paragraph (1) and paragraph (3) shall be carried out in

accordance with laws and regulations in the field of state financial and/or cooperation agreements.

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Article 5

(1) The establishment of fund as referred to in Article 2 paragraph (1) letter b, shall be carried out through:

• banking instruments;

• capital market instruments; and/or

• other financial instruments in accordance with laws and regulations.

(2) In the event that the establishment of fund that is originated from Trust Fund/Conservation Aid as referred

to in Article 3 letter b, it shall be carried out based on agreements in a contract/an agreement in accordance with provisions of laws and regulations.

Article 6

(1) The distribution of environmental fund as referred to in Article 2 paragraph (1) letter c shall be carried out

in accordance with agreements in a contract/an agreement.

(2) The distribution of environmental fund as referred to in paragraph (1) can be carried out through the

following mechanism: