Ruling on new joint timber estates revised<\/p>\n
JAKARTA (JP): The establishment of joint-venture timber
\nestates must now comply with the 1995 Law on Limited Liability
\nCompanies which states that half of the nominal value of each
\nshare subscribed must be paid up at the time of establishment.<\/p>\n
Previously, a 1995 decree issued by the minister of forestry
\nstipulated that to establish a joint-venture timber estate, 10
\npercent of the government shares and reforestation funds
\nallocated for the timber estate must be paid up.<\/p>\n
The revision, which was made through Ministerial Decree No.
\n57\/1996, was announced yesterday.<\/p>\n
According to the 1995 Ministerial Decree, the equity capital
\nof a joint-venture industrial timber estate shall consist of
\ngovernment shares derived from reforestation funds (14 percent),
\nprivate capital (21 percent), interest-free loans from
\nreforestation funds (32.5 percent) and loans at commercial rates
\nfrom reforestation funds (32.5 percent).<\/p>\n
Law No. 1\/1995 on limited liability companies states that all
\nissued shares must be paid up in full at the time of a company's
\nlegalization by virtue of valid evidence of payment, while each
\nfurther issuance of shares must be paid in full.<\/p>\n
The law also stipulates that at the time a limited liability
\ncompany is established, at least 25 percent of the authorized
\ncapital must be issued.<\/p>\n
The government currently encourages businesses to establish
\ntimber estates to help offset the country's declining log
\nsupplies and to secure raw material for wood-based industries.<\/p>\n
The funds to establish a joint-venture industrial timber
\nestate can be obtained from government shares within the firm,
\nusually called \"government equity participation\" which is
\nfinanced by reforestation funds.<\/p>\n
Reforestation funds, together with forest royalties, are
\nmandatory fees imposed by the government to ensure that forests
\nare managed in an environmentally-sound manner. The amount of the
\nfees, which depend on the volume and type of timber felled, is
\nincorporated in the timber prices.<\/p>\n
The development of timber estates are funded in two stages.
\nThe first stage uses funds from government shares, private
\ncapital and interest-free loans from reforestation funds.<\/p>\n
The second stage uses loans from reforestation funds with
\ncommercial interests. But these loans can only be obtained after
\na minimum of 67.5 percent of the area targeted for a timber
\nestate has been well-developed. (pwn)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/ruling-on-new-joint-timber-estates-revised-1447893297",
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"sponsor": "Okusi Associates",
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