UNIVERSITY OF PADUA

FACULTY OF AGRICULTURE Departments of Land and Agro-forestry Systems

Erasmus Mundus International Master on Sustainable Tropical Forest (SUTROFOR)

The Legal System for the Implementation of Forest Carbon Schemes within REDD+ Projects in Indonesia: Will it secure property rights?

Supervisor Prof. Paola Gatto Co-Supervisor Dr. Marco Boscolo Francesca Felicani Robles Master student Ivonne Melissa no. 624814 Academic Year 2009 2010

Index Abbreviation and Acronyms ................................................................................ 6 Summary .......................................................................................................... 11 1. Introduction............................................................................................... 13 1.1 Background ........................................................................................ 13 1.2 Problem statement and objectives of the thesis ................................. 15 1.3 Structure of the thesis ........................................................................ 16 2. Theoretical and conceptual background: property rights, land and forest tenure issues in the context of REDD ....................................................... 19 2.1 Reducing Emissions form Deforestation and Forest Degradation (REDD) .............................................................................................. 19 2.2 Rights, property rights and natural resources..................................... 25 2.3 Property regimes and forests ............................................................. 29 2.4 Forest tenure, tenure security and its importance in REDD implementation .................................................................................. 33 2.5 Carbon-sequestration rights ............................................................... 38 2.6 The Australian approach to the issue of Carbon-sequestration rights 44 2.7 Identification of research questions .................................................... 46 3. Research methodology ............................................................................ 47 3.1 Case-studies as a research method ................................................... 47 3.2 Criteria for choosing case studies ...................................................... 48 3.3 Data collection.................................................................................... 50 3.4 Data analysis and limitations .............................................................. 52 4. Indonesia: current realities ....................................................................... 55 4.1 Indonesia at glance ............................................................................ 55 4.2 Forest in Indonesia............................................................................. 56 4.3 Land and forest tenure system in Indonesia ...................................... 60 4.4 Legal framework in Indonesia ............................................................ 67 4.5 REDD in Indonesia............................................................................. 69 5. Results and Discussions .......................................................................... 77 5.1 Descriptive analysis of chosen case studies ...................................... 77 5.1.1 REDD in the Ulu Masen Ecosystem, Aceh................................ 77 5.1.2 REDD in Meru Betiri National Park, East Java .......................... 80 5.1.3 Berau Carbon Forest Program, Kalimantan .............................. 85 5.1.4 UNREDD Carbon Project in Central Sulawesi .......................... 88 5.1.5 REDD Project by WWF in Jayapura Regency, Papua .............. 91 5.2 Readiness of Indonesian institutional framework to implement REDD ........................................................................................................... 93 5.3 An assessment of project performance in terms of property rights security .............................................................................................. 98 6. Conclusions and recommendations ....................................................... 131 6.1 Conclusions...................................................................................... 131 6.2 Recommendations ........................................................................... 132 Quoted literature ............................................................................................. 133 Web sites........................................................................................................ 141 Annexes ......................................................................................................... 143 Annex 1 - Terminology ................................................................................... 143 Annex 2 Questionnaire ................................................................................ 148

Annex 3 Community tenure security assessment ........................................ 150

List of figures Figure 1. Elements of Community Tenure Security .......................................... 36 Figure 2. Actors and Actions in securing community tenure ............................. 38 Figure 3. Location of the five case-studies ....................................................... 50 Figure 4. Map of Indonesia ............................................................................... 55 Figure 5. Forest management models for local community participation .......... 58 Figure 6. Road Map of REDD Indonesia-phased approach ............................. 70 Figure 7. Strategy REDD Indonesia ................................................................. 72 Figure 8. Demonstration activities in Indonesia ................................................ 74 Figure 9. REDD voluntary activities in Indonesia .............................................. 76 Figure 10. Map of project area of Ulu Masen Ecosystem ................................. 78 Figure 11. Location of Meru Betiri National Park .............................................. 82 Figure 12. Framework for stakeholder consultation .......................................... 83 Figure 13. Location of Berau District ................................................................ 85 Figure 14. Phases of development of Berau Carbon Forest Program .............. 87 Figure 15. Location of Central Sulawesi ........................................................... 89 Figure 16. UNREDD NJP Programme Structure .............................................. 91 Figure 17. Map of Jayapura Regency .............................................................. 92 Figure 18. Community tenure security in 2 REDD project sites in Indonesia and in Australia ...................................................................................... 97 Figure 19. Project quality assessment of five selected projects ..................... 123 Figure 20. Detail of project quality assessment of five selected projects ........ 125 List of tables Table 1. A picture of possible ownership regimes of Carbon sequestration potential .............................................................................................. 41 Table 2. Ownership regimes of Carbon sequestration adopted in Australia and their tradability..................................................................................... 45 Table 3. REDD plus strategy readiness phase (2009 2012).......................... 72 Table 4. REDD Demonstration Activities in Indonesia ...................................... 74 Table 5. Voluntary and local government initiatives ......................................... 75 Table 6. Result analysis of community tenure security in 2 REDD projects in Indonesia and in case of Aborigin community, Australia ..................... 96 Table 7. Proposed framework for assessment of project performance in terms of property rights security ........................................................................ 99 Table 8. Result of project quality assessment of five selected projects .......... 102 List of boxes Box 1. Steps of a REDD supply-chain .............................................................. 21 Box 2. A characterization of the phases for implementation of forest carbon policy and programs .............................................................................. 23 Box 3. Free, Prior, and Informed Consent (FPIC) ............................................ 24 Box 4. Possible Forest Management Regimes ................................................. 32
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Box 5. Lindsays characteristics of secure community tenure .......................... 35 Box 6. Steps towards establishing carbon ownership in a given legislative context ................................................................................................... 43 Box 7. Adat regulation in managing forest ........................................................ 61 Box 8. Forest Zones vs State Forests .............................................................. 65 Box 9. REDDES (Reducing Deforestation and Forest Degradation and Enhanching Environmental Services in Tropical Forests) ...................... 84

Abbreviation and Acronyms

AD Adat AFEP A/R BAP BAPPEDA BPN Bupati

Avoided deforestation Custom. A non-codified collection of rules of formal behaviour, upheld through social sanctions, varying from time to time and place to place World Bank Multi-Donor Funds Aceh Environment and Forest Project Afforestation/ reforestation Bali Action Plan Badan Perencanaan dan Pembangunan Daerah (Regency Planning and Development Planning Agency) Badan Pertanahan Nasional (National Land Administration Agency) Head of a district or city Carbon Head of Kecamatan (sub-district) Climate, Community and Biodiversity Alliance (Standard that currently being used to in the validation process of REDD proposal through voluntary market mechanism) Climate Change Trust Fund Clean Development Mechanism

C
Camat CCBA

CCTF CDM

CER
CIFOR CO2 COP CPR CSOs DA Dinas Dinas Kehutanan Distrik DGPLAN DNPI EU FAO FCPF FDP FFI FGD FMU

Certified Emissions Reduction

Centre for International Forestry Research Carbon dioxide Conference of the Parties. The supreme decision-making body of the UNFCCC. Common Pool Resource Civil Society Organizations Demonstration Activity Government office at regency or provincial level Forestry office at regency or province District. In other part of Indonesia this is equivalent to kecamatan Direktorat Jendral Planologi Kehutanan (Directorate General for Forest Planning) Dewan Nasional Perubahan Iklim (National Council on Climate Change) European Union Food and Agriculture Organization of the United Nations Forest Carbon Partnership Facility (of the World Bank) Forest Dependent Peoples Flora and Fauna International Focus Group Discussion Forest Management Unit

FORDA FPIC FRA FRIS GHG GoI GoJ GoN HA HCVF HGU HKm HK HL HM HN HP HPA HPH HPT HPK HR HTI HTR HU ICRAF IEC IFCA IIED ILO IPs IPCC ITTO IUPJL Izin garap JPD Kabupaten

Forest Research and Development Agency Free, Prior and Informed Consent Forest Resources Assessment Forest Resources Information System Greenhouse Gas Government of Indonesia Government of Japan Government of Norway Hutan Adat (customary forest) High Conservation Value Forest Hak Guna Usaha (plantation licence) Hutan Kemasyarakatan (one of Indonesias community based forest management programmes) Hutan Konservasi (Conservation Forest) Hutan Lindung (Protected Forest) Hak Milik (right of ownership) Hutan Negara (state forest) Hak Pakai (use right) Hutan Produksi Alam (Natural Production Forest) Hak Pengusahaan Hutan (logging concession) Hutan Produksi Terbatas (Limited Production Forest) Hutan Produksi Konversi ( Convertible Production Forest) Hutan Rakyat (one of Indonesias community based forest management programmes) Hutan Tanaman Industri (Industrial Plantation Forest) Hutan Tanaman Rakyat (one of Indonesias community based forest management) Hak Ulayat (customary authority over land) World Agroforestry Centre Information, Education, and Communication Indonesian Forest Climate Alliance International Institute for Environment and Development International Labour Organization Indigenous Peoples Inter-Governmental Panel on Climate Change International Tropical Timber Organization Izin Usaha Pemanfaatan Jasa Lingkungan (Permit for Utilization of Environmental Services) Right to cultivate Joint Programming Document District. The administrative unit in Indonesia which is situated immediately below the provincial level

Kawasan Kawasan hutan Kecamatan Keucik KPA KPH KSA LATIN LIP LULUCF m Masyarakat adat MBNP MRV MoA MoFor MOU MT Mha NCAS NCASI NCCC NGOs NICFI NJP NPB NPD NTFP ODA OED Ondoafi PEB Perdasus PDD PHKA PP PSP RED

Region or area Forest area Sub-district. Administrative unit which is situated immediately below the district level Village leader. Also known as Geucik in Acehnese Kawasan Pelestarian Alam (Nature Conservation Zone) Kesatuan Pemangkuan Hutan (Forest Management Unit, FMU) Kawasan Suaka Alam (Nature Reserve Zone) Lembaga Alam Tropika Indonesia Lead Implementing Partner Land Use, Land Use Change and Forestry Meter Customary communities Meru Betiri National Park Measurement Assessment Reporting and Verification Ministry of Agriculture Ministry of Forestry Memorandum of Understanding Mega tonnes Million hectares National Carbon Accounting System National Carbon Accounting System Indonesia National Council for Climate Change Non-governmental Organizations Norway International Climate and Forest Initiative National Joint Programme National Project Board National Project Director Non-timber forest product Official Development Assistance Oxford English Dictionary Traditional chief in Jayapura Project Executive Board Peraturan Derah Khusus (regional autonomy law) Project Design Document Perlindungan Hutan dan Konservasi Alam (Forest Protection and Nature Conservation) Peraturan pemerintah (Government Regulations) Permanent Sample Plot Reducing Emissions from Deforestation

REDD REDDI REDDES REL RIL RLPS R-PIN RPJM R-PLAN RRI RS RTRWP RUPES SFM TA Tahura Tanah ulayat TB TGHK TLAS TNC UN UNDG UNDP UNDRIP UNEP UNFCCC UN-REDD

Reducing Emissions from Deforestation and Forest Degradation Reducing Emissions from Deforestation and Forest Degradation in Indonesia Reducing Emissions from Deforestation and Forest Degradation and Enhancing Environmental Services in tropical forest Reference Emissions Level Reduced impact logging Rehabilitasi Lahan dan Perhutanan Sosial (Land Rehabilitation and Social Forestry) REDD Project Idea Note Rencana Pembangunan Jangka Menengah (Midterm Development Plan) REDD Plan Rights and Resources Initiative Remote Sensing Rencana Tata Ruang Wilayah Propinsi (Provincial Level Spatial Planning) Rewarding Upland Poor for Environmental Services (of ICRAF) Sustainable Forest Management Technical Assistance Taman Hutan Rakyat (provincial park) Customary land Taman Buru (Game Reserve Park) Tata Guna Hutan Kesepakatan (Consulted Forest Planning) Timber Legality Assurance System The Nature Conservancy United Nations United Nations Development Group United Nations Development Programme United Nations Declaration on the Rights of Indigenous Peoples United Nations Environment Programme United Nations Framework Convention on Climate Change. United Nations Collaborative Programme on Reducing Emissions from Deforestation and Forest Degradation in Developing Countries Verified Emission Reduction World Bank World Resource Institute World Wildlife Fund

VER WB WRI WWF

Acknowledgement
With the completion of my thesis follows the end of two years fruitful studies, I have a lot of gratitude to express to everyone who gave me support and made significant contribution to the success of this thesis and my study period. My deepest appreciation goes to Allah SWT, The Almighty for his bless and guidance for every step in my life. To Prof. Paola Gatto, my supervisor, I would like to say thank you and give my special appreciation for her kindness, patience, guidance, valuable advices and support in all the time of the research and writing of the thesis. I also would like to thank Dr. Marco Boscolo and Ms. Francesca Felicani Robles, my co-supervisors, for giving me tutorship, suggestions for the research topic and methodology, networking, and some related reading materials during my study in FAO headquarter. I hereby would like to give special thanks to Mr. Michael Martin and Mrs. Eva Muller for giving me opportunity to conduct my study while doing voluntary in FOEP (Forest Economic and Policy) division, Forestry Department FAO for five months. I also would like to thank Mrs. Francesca Romano for giving me input regarding questionnaire and information on forest tenure issue; Mr. Johan Lejeune and Ms. Marguerite FranceLanord for helping me establishing contacts with some key stakeholders on REDD in Indonesia and helping me composing draft message to those contacts; Mr. Jesper Tranberg, Mr. Alberto Sandoval and Mrs. Cecile Girardin for giving me some inputs regarding REDD issues. Then to Janice Saich, Susy Tafuro, Samoa Perucca, Rebecca Rutt, Tullia Baldassarri and other staffs in Forestry Department thank you for friendship and your kindness during my stay in FAO. In this opportunity, I also would like to thanks Mr. Arif Aliadi, Mrs. Kirsfianti L Ginoga , Mr. Fakhrizal Nashr, Mr. Zulfira Warta, and Mr. Machfudh for being respondents of the interview. To Rogier Klaver, thank you for giving me some feedback for the questionnaire, giving me some inputs and suggestions, and linking me with some contacts. I also particularly grateful to Dr. William Sunderlin, Dr. Alain Karsenty, Mr. Fabian Schmidt, Dr. Helmut Dotzauer, Mr. Tomoyuki Uno, Mr. Rohni Sanyoto, Mr. Rudi Syaf, and to all organizations and individuals for giving me some useful information and suggestions. Besides, I would also like to convey my heartfelt appreciation to my family, Maulahikmah Galinium, and friends whose love, support, encourage, and goodwill have brought me this far. Finally, I give special thanks to European Commission for sponsoring my two-year Masters programme, to all my professors, tutors, and classmates in both TU Dresden, Germany and University of Padua, Italy for giving me these two years memorable study time.

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Summary
Recognition of property rights and tenure security are key elements for successful REDD implementation. In fact, forest property rights and tenures are often unclear, contested and overlapped. The situation also happens in Indonesia where some conflicts arise due to unclear property right and contradictive regulation. Early efforts in enhanching current system including legal system in order to be ready for implementing REDD has been taken. However, there are still some doubts whether the system under development is able to address issue of property right security. Therefore the study aims at: 1) analyzing how well Indonesia is addressing the issue of property right security in its readiness phase; 2) contributing towards the identification of an analytical framework for assessing whether and to what extent REDD projects can be a tool for delivering significant benefits for Indonesian local populations. In order to answer to the studys objectives, five REDD projects in Indonesia have been selected as case studies. All projects developers have been interviewed through phone and email. In addition, project documents and some relevant literature have also been used as additional source of information. Collected information have then been analyzed by using concept of better REDD implementation in national level by Streck (2009), concept of community tenure security by White (2004), concept of carbon rights in Australia, and CCBA REDD+ Social and Environmental Standards for assessing project performance in addressing property rights issue. The results of the study show that technically Indonesia is ready in implementing REDD but until now the readiness including new establish legal system on REDD still can not address property right security for local community. At project level, both demonstration and voluntary activities are concerned with property rights security in their planning phase. Unclear issues that have not been addressed so far are benefit sharing mechanisms and legal implementation and undertanding on REDD. To be more advanced in benefiting from REDD mechanism, there is the need of.establishing, as much as possible and in compliance with the existing legal and institutional framework, a C right separate from land ownership. However, it is anticipated that, in Indonesia, this aspect is particularly delicate being almost all forest area owned or controlled by the State, and having a very complex stratification of official and customary and tenure titles and right distribution.

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1.
1.1

Introduction
Background
Forests play an important role for human life. They provide some products and services that can be utilized by humans to support their need and economic life. Forests also maintain ecosystem balance, provide watershed services (control soil erosion, prevent flood, and maintain aquatic productivity), landscape beauty, and also help reducing green house gases in the atmosphere. But, because of combination of market, policy, and institutional failure, which make costs for conserving forests or for implementing sustainable forest management (SFM) higher than cutting down trees, deforestation occurs almost everywhere especially in developing countries. Deforestation accounts for approximately 20% of global greenhouse gas emissions (IPCC, 2007), making it a major driver for anthropogenic climate change (Scholz & Schmidt, 2008). It is also considered as the second most important contributor to climate change after the combustion of fossil fuels and the largest source of greenhouse gas (GHG) emission in the developing world (Houghton, 2005 cited in Ebeling & Yasue, 2008). Therefore emission reductions will not be achieved without reducing forest lost and degradation (Cotula & Mayers, 2009). Inclusion of Avoided Deforestation (AD) and Reducing Emissions from Deforestation (RED) is vital for tackling climate change (Richards, 2008). Starting with integration of RED concept into Kyoto Protocol at the UNFCCC COP 11 in Montreal in 2005 (Scholz & Schmidt, 2008), the debate has continuously gained momentum until adoption of concept Reducing Emissions from Deforestation and Forest Degradation in developing countries (REDD) in 2007 and REDD plus in 2008. Forest and tenure stand out as a key issue in both global and national REDD+ debate (Angelsen et al., 2009). Property rights to forest lands and resources are often not clear, contested, overlapping or simply unenforced (White & Martin, 2002; Sunderlin et al., 2009; Angelsen, 2009). Forest and the ecosystem services generated by forest resources are often considered as externalities or as public goods (Ostrom, 2005). Free riding and other mechanisms that lead to the undersupply of public goods may also lead to the overuse of common pool resources (Strener, 2002). It will lead to sub optimal investment in improving

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resources, monitoring use, sanctioning rule-breaking behaviors, and facilitating deforestation (Ostrom & Hess, 2007; Streck, 2009; Ostrom, 2005). Another main concern is who will hold the power in terms of managing and distributing benefits. The state still dominates many of the current national REDD+ proposals (Peskett & Brockhaus, 2009). Heavy handed state control, lack of respect for customary forest management practices, insecure tenure and conflict destabilize forest management systems (Sunderlin & Atmadja, 2009). When people living in forests have no tenure rights, their leverage in formulating national policy on REDD+ is limited (Sunderlin & Atmadja, 2009). These situations will reduce the 3 E+ criteria outcomes of REDD+ policies: climate effectiveness, cost efficiency and equity outcomes, in addition to their contribution to generation of co-benefits (Angelsen et al., 2009; Sunderlin & Atmadja, 2009; Sunderlin et al., 2009). Therefore understanding tenure issues and trends is essential for all actors concerned with forests (White & Martin, 2002). Clarifying tenure before implementing REDD+ including measuring and anticipating the consequences of inaction, identifying the obstacles to clarifying tenure, reforming tenure, improving national tenure information and holding public consultations on REDD is key to sustainable REDD+ success (Sunderlin et al., 2009). Recognizing forest tenure rights, particularly in implementing REDD+ means identifying people who will represent groups that hold rights (Sunderlin et al., 2009). According to the Stern Review (2006), At a national level, defining property rights to forestland and determining the rights and responsibilities of landowners, communities and loggers, is key to effective forest management. This should involve local communities, respect informal rights and social structures working with development goals and reinforce the process of protecting the forests (Sunderlin et al., 2009; Mehta & Kill, 2007). Similarly, Eliasch (2008) states, Only when property rights are secure, on paper and in practice, do long term investments in sustainable management become worthwhile. Multilateral, bilateral, and national policy documents on REDD+ readiness also stress the need to clarify tenure before implementing REDD+ (Sunderlin et al., 2009; Angelsen et al., 2009; Streck, 2009).

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1.2

Problem statement and objectives of the thesis

Political will is another key for REDD+ to succeed (Sunderlin et al., 2009). The implementation of REDD+ at the national level involves more than just clarifying existing rights to resources, it also should bring to the creation of a set of new legal rights that relate to the reduction of GHG emissions and sequestration potential of a particular activity (Streck, 2009; Jrvinen, 2008). The schemes must also engage legitimate stakeholders whose claims to forest benefits (Sunderlin et al., 2009). In New South Wales Australia, for instance, the government established legislation regarding with property rights to forest carbon services in 1998 (Landell-Mills & Porras, 2002). With nearly 90 million hectares under forest cover, Indonesia has the worlds third largest area of tropical forest, as well as extensive carbon rich peat lands. However, Indonesia is also the worlds largest emitter of CO2 from deforestation and forest land use change (Barr et al., 2010). Through REDD+ Indonesia has a unique opportunity to generate revenue, reduce the loss of forest cover and, in doing so, make a significant contribution to reducing global carbon emissions (Barr et al., 2010; Boccucci et al., 2008). Supported by several bilateral donors and the World Bank, Indonesia took up the challenge to enhance its preparedness by developing policies and strategies to implement REDD+ at the national level (Murdiyarso, 2009). Early efforts have led to the establishment of regulatory framework and national institutions, including the National Council for Climate Change (NCCC) under the presidents office and the REDD committee under the Ministry of Forestry. But their performance and effectiveness, in relation of their authority and coordinating roles, are untested. Unclear national standards and policy framework, non transparent application and approval processes, overlapping authorities, poor information flows, and unclear property rights remain huge challenges for Indonesia (Murdiyarso, 2009; Landell-Mills & Porras, 2002) which need to be addressed. Therefore in this context, the overall objectives of this thesis are to analyze how well Indonesia addressing issue of property right security in its readiness phase and to contribute towards the identification of an analytical framework for assessing whether and to what extent REDD projects can be a tool for delivering significant benefits for Indonesian local populations especially

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through enhancing security of property rights and land tenure regime (Larson et al., 2010). These objectives will be achieved through the following steps: 1. examining the situation of current forest tenure system, both theoretical and operational viewpoints 2. understanding how the needed reform of forest tenure system has been implemented to cater for the needs of the implementation of carbon rights 3. analyzing the feasibility of implementing some pioneering carbon property rights regime, e.g. that developed in Australia, within the Indonesian institutional/ legal context 4. assessing, at a broad institutional scale, the readiness to implement REDD projects of Indonesia in terms of property rights assignment and land tenure 5. developing an appropriate set of principles and indicators at project level through which to assess project performance in terms of securing property rights to local population. Based on this experience the final outcome of the thesis will be the identification of problems, the suggestion of rules and modalities and the provision of recommendations on how to establish a legal system of carbon rights in Indonesia and the answer to the question whether it will be able to increase security of tenure for local population.

1.3

Structure of the thesis

The thesis is organized in 6 chapters. Chapter 1 sets out the research problems based on the background information on REDD and importance of tenure clarification in REDD implementation. The research objectives are then stated. Chapter 2 introduces the relevant theories in the study which include general information on REDD, rights and property rights, property regimes, land and forest tenure, tenure security, carbon rights, and also carbon rights regime in Australia. Concept of carbon right in Australia is used as reference for analyzing feasibility of implementing the regime in Indonesia. This chapter is closed by identification of research questions. Chapter 3 describes the research methodology. A brief description of case study as a research approach is in the beginning of this chapter. Then, criteria for choosing case studies, data collection methods, data analysis methods and research limitations are

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discussed. Description of current realities in Indonesia including general information on land and forest tenure system, legal framework, and REDD implementation in the country are found in Chapter 4. Chapter 5 sets out details of the results and discussions. Descriptive analysis of five selected REDD projects in Indonesia begins this chapter, followed by analysis of readiness Indonesian institutional framework of property rights to implement REDD project and ends with assessment of case-studies performance in term of property right security. Finally, the conclusions that have been drawn from the results of analysis, limitations of this study and the suggestions for future research are presented in Chapter 6.

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2.

Theoretical and conceptual background: property rights, land and forest tenure issues in the context of REDD
Reducing Emissions form Deforestation and Forest Degradation (REDD)
Concern on inclusion of Avoided Deforestation (AD) and Reducing Emissions from Deforestation (RED) as vital for tackling climate change (Richards, 2008) started at the UNFCCC COP 11 in 2005. As it became clear that forest degradation in some countries was an even bigger problem than deforestation (Wertz-Kanounnikoff & Angelsen, 2009), the Bali Action Plan adopted in December 2007 at the UNFCCC COP 13 taken first step in including Reducing Emissions from Deforestation and Forest Degradation in developing countries (REDD) in the post 2012 regime (Mayers et al., 2008 in Cotula & Mayers, 2009; Richards, 2008; Scholz & Schmidt, 2008). REDD is not directed at stopping the use of forests for timber, nor at stopping planned conversion of forests to other economic uses (MoFor, 2008). REDD is a mechanism that uses

2.1

market/financial incentives to reward developing countries with large forest area as well as with high deforestation rates that reduce their emission of greenhouse gases from deforestation and forest degradation (CIFOR, 2009; Scholz & Schmidt, 2008). Countries that demonstrate verifiable reductions in deforestation, or maintenance of forest cover, would be paid compensation through a global and /or regional fund or would be allowed to sell carbon credits that permit additional emissions elsewhere (Mehta & Kill, 2007). The Stern Review on the economics of climate change noted that REDD could be a costeffective route (Cotula & Mayers, 2009; Richards, 2008). The concept of REDD has been expanded to REDD plus the role of conservation, sustainable management of forests (SMF) and enhancement of forest carbon stocks (REDD+) (Minang et al. 2009). Plus sign indicates there could be climate benefits not only from avoiding negative changes (deforestation, degradation) but also from enhancing positive changes (Angelsen & Wertz-Kanounnikoff, 2009) which referred to forest regeneration and rehabilitation, negative degradation, negative emissions, carbon uptake, carbon removal or just removals (Angelsen, 2009). In some versions REDD+ will also include peat lands (Minang et al. 2009). REDD+ became official language at the 2008 COP14 in Poznan (Angelsen & Wertz-Kanounnikoff, 2009).
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Three types of changes are included in REDD+: 1) deforestation, meaning that forest area is reduced, 2) degradation, meaning that carbon density is reduced, and 3) regeneration and rehabilitation, meaning that carbon density is increased. Enlarging the area of forests (e.g. through aforestation and reforestation, A/R), is another way to increase forest carbon stocks, but A/R is not part of REDD+ (Angelsen, 2009). REDD+ is not only about climate change. Other goals, known as co-benefits are also important. Four types of co-benefits are: first, forest conservation provides other environmental services such as preserved biodiversity; second, REDD+ actions and forest conservation might have socio economic benefits such as reducing poverty, supporting livelihoods and stimulating economic

development; third, political change toward better governance, less corruption, and more respect for the rights of vulnerable groups; fourth, it can boost the capacity of both forests and human to adapt to climate change (Angelsen, 2009). Carbon credits associated with REDD are different from A/R CDM in which they derive not from growing new trees but from avoiding deforestation and reducing the size of the carbon stock lost as the biomass of forest ecosystems is degraded (IFCA, 2008), with respect to a defined baseline representing past rates of loss or projected rates of loss, consistent with national strategic development directions. REDD carbon credit is produced through a REDD supply-chain which essential steps are described in Box 1. Three core concepts are at the basis of a REDD development: 1. Permanence, i.e the extent to which forest permanently store carbon, addressed through reducing the rate of emissions from deforestation and degradation rather than preserving carbon in a specific piece of forest.

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Box 1. Steps of a REDD supply-chain (IFCA, 2008; MoFor, 2008) 1. development of an organizational/ management infrastructure capable of: setting a baseline against which annual emissions can be measured ; monitoring the changes with sufficient precision to deliver confidence and quality to the tradable carbon credits; managing the sale of carbon credits distributing the incomes from the trade in carbon credits to those agencies or groups responsible for achieving the reductions. 2. identification of those activities, or organizational and industry changes necessary to achieve a reduction in emissions; 3. development of a carbon market system capable of handling the trade, especially recognizing the nature and source of potential buyers; and 4. development of a system of forest governance that ensures that law is enforced; that systematic issues of governance such as transparency is addressed and that carbon transactions are safeguarded.

2.

Leakage, possible

i.e. increase

the in

emissions in an area outside the the boundary activity,

REDD

caused either by project activities that essentially force outside boundary deforestation the project (activity

shifting), or by market effects 3. that change

supply and demand. Additionality, i.e. the fact that activities claiming REDD credits must

show that reduced deforestation rates attributed to the project would not have occurred in the absence of carbon finance. A number of additionality tests exist under the CDM and voluntary standards that can be used to test for additionality under REDD (MoFor, 2008). Reference levels, implementation scale, financing options, and implementation phases are other key elements which need to be considered when implementing a REDD process (Parker et al., 2008; Meridian institute, 2009 cited in Irawan & Taconi, 2009). 1. Reference levels: i.e. the level against which the impacts of REDD policies and measures are assessed to determine whether participating countries have reduced emissions and should receive financial rewards (Angelsen, 2008; Parker et al., 2008; Meridian Institute, 2009 cited in Irawan & Taconi, 2009). Host countries with deforestation rates above the global average will be compensated for the reduction of the national rates during the commitment period as compared to pre-commitment period. Countries with past deforestation rates lower than the global average will be rewarded for not increasing their deforestation rates higher than the precommitment level (Irawan & Taconi, 2009). National reference levels have been developed based on national factors including: historic emissions

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and removal rates, forest cover, expected future trends and capacity for emission reductions such as GNP per capita (Irawan & Taconi, 2009). 2. Implementation scale, considering two options: i) national-based and ii) project-based (UNFCCC, 2007 cited in Irawan & Taconi, 2009). National based implementation requires the national government to develop a national carbon accounting system and a national management system to implement REDD projects and to distribute revenue generated to relevant stakeholders within the country. Project based implementation allows buyers to interact directly with an independent entity verifying the credit generation (Myers, 2007 cited in Irawan &Taconi, 2009). Most of the proposals of REDD mechanism support the national based approach for the implementation of REDD. National based implementation is better suited to address the issue of leakage within host countries because it enables a complete measurement and monitoring of emission reductions within a country as a whole. The implementation of REDD only at the project level might not lead to a significant reduction of deforestation in a country because it cannot address underlying causes occurring at the district, provincial, and national levels (Irawan &Taconi, 2009). 3. Financing options: with three alternatives: i) market-based (either voluntary or compliance); ii) fund-based; and iii) hybrid combination of both (FAO & RECOFT 2009). In a carbon market-based mechanism, REDD certified emissions reductions (CERs) could be used by companies and national governments to meet emission reduction targets in their national cap-and-trade systems (Murray et al., 2009; Paker et al., 2009). In a fund-based mechanism, official development assistance (ODA) or a separate and additional tranche of resources are not tied to any compliance obligations (Murray et al., 2009). In the short term, it is likely that REDD will be financed through fund-based approaches and that over time these will shift towards a market-based system. A hybrid approach will be adopted in the medium term followed by a move towards compliance markets as capacities are strengthened, experience is gained, and consensus emerges (FAO & RECOFTC, 2010). 4. Implementation phases: i.e. the successive phases according to which a REDD mechanism should be implemented in order to ensure an effective and result-based mechanism (UNFCCC, 2009 cited in Irawan & Taconi, 2009). Three phases have been proposed (Box 2.).

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National strategies for REDD should include sub-national actions and strategies that are consistent with national development goals (UNFCCC, 2009 cited in Irawan & Taconi, 2009). The involvement of the sub-national level in the implementation of REDD can vary depending on the extent of authority devolved in forest management. The implementation process can involve a topdown or a bottom-up model. In top-down model, local governments implement REDD based on certain prescription provided by the national government. In contrast, local governments have
Box 2. A characterization of the phases for implementation of forest carbon policy and programs (Olander et al. 2009, Angelson et al., 2009, Varghese, 2009; FAO & RECOFTC, 2010) Phase 1- Planning Development of a national forest carbon strategy (REDD readiness), including national dialogue and local stakeholder consultation; strengthening institutions, technical, and human capacity; designing MRV system and forest carbon accounting; developing REL, and demonstration activities mostly funded through voluntary contributions through such mechanisms as the World Banks Forest Carbon Partnership Fund (FCPF), UNREDD, and other bilateral arrangements Phase 2- implementation Implementing policies and measures proposed in the national strategies using sustained funding from a global facility supported by binding financial commitments from developed countries. Those developed country commitments may be tied to a national cap and trade policy and financed by revenues generated therein. Developing country use of these funds would be based on demonstrated commitment and continued performance assessed using indicators of emission reductions. Phase 3- payment for reduction Paying for performance on the basis of forest emission reductions relative to an agreed-upon national reference level (market based mechanism). Financing can be through global compliance markets tied to national cap- and- trade policies or other compliance-linked mechanism

the authority to develop local implementation implementation bottom up plans them and a

under The

model.

local

governments involvement in the implementation of REDD is under the national-based approach,

which should be situated within a framework of intergovernmental, relationship between the central and sub-national levels (Irawan & Taconi, 2009). For successful REDD regimes, national guarantee intact and governments that forests should remain on a

standing

permanent basis. Although the greatest focuses attention on currently the

changing

behaviours of countries with the highest deforestation rates, a well-

designed international REDD regime should also seek to reward countries traditionally maintaining their forests, so that they are not under pressure to cut their own forests (Costenbader, 2009). It is essential also to recognize local communities and indigenous peoples rights of tenure over forest areas, and the use of forests and forest products for their livelihoods. For this reason, the process of obtaining Free, Prior, and Informed Consent (FPIC) (Box 3.) has

23

become a major topic in REDD+ discussions (Cotula & Mayers, 2009; FAO & RECOFTC, 2010). Moreover, raising awareness and strengthening capacities of all forest right holders and stakeholders before implementation of REDD activities also needs attention. Legal clarity is also a pre-requisite for a successful REDD implementation. However, this does not necessarily require that countries rewrite their existing legislative and regulatory frameworks. Indeed, before creating any new laws, many countries can take essential initial steps by removing existing legal norms providing incentives for deforestation and forest degradation (Costenbader,
Box 3. Free, Prior, and Informed Consent (FPIC) (UNREDD & MoFor, 2010) Free means no coercion, intimidation or manipulation. Prior means consent has been sought sufficiently in advance, considering time requirements of indigenous consultation/ consensus processes Informed: information is provided that covers (at least) the following aspects: The nature, size, pace, reversibility and scope of any proposed project or activity The reason(s) for or purpose(s) of the project and/or activity The duration of the above The locality of areas that will be affected Consent: consultation and participation are crucial components of a consent process. This process may include the option of withholding consent.

2009; Iza, 2009). By phasing such work in the coming years in their programs to achieve full REDD functionality, countries

should be able to design and implement regulatory systems providing the best t for their unique national circumstances, be they entirely or new legal

instruments

amendments,

harmonization or reinterpretation of existing laws (Iza, 2009).

Since REDD pilot projects can only sell carbon credits through voluntary markets, these provide valuable experience and lessons for countries preparing for REDD+ in terms of understanding methodological and implementation issues, including the need for stronger local capacity in monitoring carbon stocks and for more efficient and reliable local governance systems, but especially for forest tenure reforms and the clarity over rights to trade in carbon credits (FAO & RECOFTC, 2010). Indeed, from the national legal viewpoint, the present situation is very complex, being C-credits new emergences, not always consistent with the legal framework of property rights and land-tenure arrangements of those countries wanting to take advantage of this instrument. Significantly, Hepburn (2008) has defined a new category for C-rights, intending them as rights of storage and to the commercial benefits that may flow from such storage, as opposed to the more traditional Ostrom and Schlagers (1996) cited in Sterner (2002) rights of withdrawal or to Honors (1961) rights of use.

24

Starting from acknowledging the need for innovation, or at least for adaptation of the legal framework, the rest of this Chapter will continue by dwelling upon the meaning of the concept of land property rights and its connection with forestland, based on the theory of property rights, mostly in its economic connotation (Alchian and Demsetz, 1973); then it will explore the different property right regimes and how they result in land tenure systems. Subsequently it will lay stress on land-tenure security and its implications in REDD implementations wanting to involve local populations. As a further step it will try to collocate the emergent approaches to the definition of C-rights in the context of the general theory of property rights. Finally it will describe the approach to the problem undertaken by various pioneering Australian States. The theoretical analysis and the literature review will allow, at the end of the Chapter, to identify some key-elements to serve as basis for the assessment of the Indonesian REDD implementation and approach to C-rights.

2.2

Rights, property rights and natural resources

The Oxford English Dictionary (OED) says property is a condition of being owned by or belonging to some person or persons, hence the fact of owning a thing. or, it can be the right especially the exclusive right to the possession, use or disposal of anything (Ellsworth, 2004). In the opinion of Bruce (1998), property is a set of rights and responsibilities concerning a thing itself, pertaining rights, relationships, responsibilities, and duties. FOPER (2007) also stated that property is a right to a benefit stream that is only as secure as the duty of all others with respect to the conditions that protect that stream. It refers to a degree of power that is recognised in law, a power permissibly exercised over the thing (Boydell et al., 2009). When one has a right, one has the expectation, both in law and practice, that his/her claims will be respected by those with duty (FOPER, 2007). The economic theory of property rights is very well developed in the literature of the western world, being rooted in national legal arrangements. Western Law recognizes two basic kinds of property. One is real (Anglo American law) or immovable property (European civil law), that is to say is property in land and attachments to land, like trees or buildings. The other is personal (AngloAmerican law) or movable property (European civil law), which is property in all

25

other things. Different bodies of law apply to real and personal property (Bruce, 1998). The argument postulated by von Benda Beckmann et al. cited in Boydell et al. (2009) is that all human societies have a property system comprising three elements: the social units (individuals, groups lineages, corporations, states) that can hold property rights and obligations; the construction of valuables as property objects; the different sets of rights and obligations social units can have with respect to such objects. Sterner (2002) commented that property rights are institutions that can be affected by policy, although the process is typically very slow. Property rights as generally understood include titled rights to land or to natural resources exploitation. Commonly these rights are referred to by the legal language as real estate, with emphasis on the immoveable nature of the property concerned such as land, buildings and minerals (Sheehan, 2001). The definition of property rights is closely related to concept of externality and the development of these rights over time is related to the transition from common property to private property. This process is often referred to as enclosure of the commons (Boydell et al., 2009) and has occurred in historical times, see e.g. the enclosures movement in England in the XV century. Property rights are usually treated as bundle of rights (Sheehan, 2001), often grouped into: 1. Use right (Cubbage et al.,1993 cited in FOPER, 2007), or Withdrawal right (Ostrom & Schlanger, 1996 cited in Sterner, 2002): the right to access the resource, withdraw from a resource, or exploit a resource for economic benefit; and control such as rights to use the land for grazing, growing subsistence crops, gathering minor forestry products, etc. 2. Access right (can also be considered as part of use or withdrawal right): the right to use or enjoy the property for direct utility, imposed by the owner or negotiated between the owner and the individual or group desiring the use of the property. This category also includes use of rights defined in spatial or temporal terms (Ostrom & Schlanger, 1996 cited in Sterner, 2002; White, 2004). Governments in countries with large amounts of forest have traditionally chosen to transfer access and withdrawal rights
26

together with management authority to large scale private forest industry through logging concessions. In most concessions, companies have long term rights to access, manage the land, harvest timber and exclude the public. In return, firms typically promise to pay royalties and other fees to the government (White & Martin, 2002). 3. Exclusion right: the right to exclude some users and set rules for access to a property (Ostrom & Schlanger, 1996 cited in Sterner, 2002). 4. Control right (Cubbage et al. ,1993 cited in FOPER, 2007), or Management right (Ostrom & Schlanger, 1996 cited in Sterner, 2002): the right to make decisions about how the land should be used (including deciding what crops should be planted), and managed, so to set up and modify rules for the use of a property 5. Transfer right (Cubbage et al., 1993 cited in FOPER, 2007), or Alienation right (Ostrom & Schlanger, 1996 cited in Sterner, 2002): the right to sell, mortgage or lease the land, to convey the land to others through intracommunity reallocations, to transmit the land to heirs through inheritance, thus reallocating use, control and exclusion rights. 6. Usufruct rights: the legal right of using and enjoying the fruits or profits of something belonging to others (FOPER, 2007). Types of usufruct are: a. Easement: a right enjoyed by one landowner over the land of another. The focus of an easement is upon the right which runs with the burdened land. A positive easement (such as a right of way) involves a landowner going onto or making use of something in or on a neighbour's land. A negative easement is essentially a right to receive something (such as light or support) from the land of another without obstruction or interference. It may include the bundle of rights allowing an entity to explore and exploit the potential that natural sources have to store carbon: moreover, being often perpetual, easements can be relevant in terms of the permanence condition with relation to REDD b. Lease: a party may lease a parcel of land for some purpose e.g. concession agreements granted by government or private landowners for logging. c. Profits prendre: this usufruct right gives the holder the right to remove products of natural growth from anothers land. This right typology is one of the solutions used in some Australian States for allocating Crights in the existing legal framework

27

d. Convenants: a contractual right burdening or benefiting the land to which it relates. The covenant constitute a separate chose in action1 which is only enforceable against the land in circumstances where a court is prepared to accept that a party shall not be permitted to use the land in manner inconsistent with the contract. Covenants may be positive or restrictive, and, where restrictive, can have some characteristics normally associated with property rights. Covenants, too, are types of property rights adopted in Australia for C-rights (Lawcom.gov.uk cited in Robles, 2010). In varying degrees all property rights result in the conferral of three qualities or capacities, namely: i) a management power, ii) an ability to receive income or benefits, and iii) an ability to sell or alienate the interest. The degree to which these three qualities are evident in a particular property right regime depends on the mix of fundamental characteristics that the particular property right contains (Sheehan, 2001; Boydell et al., 2009). If we look at property rights in relation to natural resources, and especially to generation of C-rights, which is the object of thesis, the six relevant characteristics of property rights identified by Sheehan (2001) appear particularly relevant: 1. Duration indicates the period, usually in years, that the property right is held, and hence represents a profit or saving to the holder. 2. Flexibility highlights that a property right is susceptible to modification and/or alteration. Such rights are constrained by the availability of the natural resource, and clearly it is conceivable that the full benefits of the right may under certain circumstances be constrained. 3. Exclusivity is the inverse of the number of holders of the same or similar property right. Clearly, a reduction in the exclusivity will reduce the profit or saving enjoyed by the holder. This characteristic is directly relevant to property rights in natural resources. 4. Quality of Title refers to the descending level of security as the tenure falls away from the optimum of notional freehold. 5. Transferability is the measurement of the market for the sale or leasing of the particular property right. A high value would indicate that the demand
1

A thing of which one has not possession or actual enjoyment, but only a right to it, or a right to demand it by action at law, and which does not exist at the time in specie; a personal right to a thing not reduced to possession, but recoverable by suit at law; as a right to recover money due on a contract, or damages for a tort, which can not be enforced against a reluctant party without suit (www.thefreedictionary.com).

28

reaches well beyond the original acquiring group, and that the mere creation of a market and hence tradability in itself enhances the value of the particular property right. In the context of property rights in natural resources, this characteristic could also be referred to as tradability, and relies heavily upon the amelioration of government constraints on transfers to other parties. 6. Divisibility refers to the possibility that the property right is shared between a number of holders over one territory or the territory itself maybe subdivided and each new part held separately. It may also be possible for the holder to divide his right on the basis of seasons or in the case of fishing rights, on the basis of particular marine species.

2.3

Property regimes and forests

A property regime is the structure of rights, duties and privileges characterising the relationships between individuals with respect to a specific good or resource, like for example forests (Vatn, 2005, p. 255). With reference to Western property concepts, four property regimes types can be identified (Bromley, 1991): State property regimes, where ownership is in the hands of the state Private property regime, where rights usually associated are

exclusiveness, duration (usually unlimited) and transferability (Romano, Buttoud-Kouplevatskaya, & Reeb, 2010) Common property, ie private property for a group of co-owners, also referred to as Common Pool Resource (CPR). Common property implies relatively open access, at least to the group to whom it is common (FOPER, 2007). It refers to a situation where there are controls over the use of the resources (Strener, 2002). One important feature of CPR is that each persons consumption reduces availability of the resource to others. A relevant difference between community systems and open access, another category of property right regimes, is that under a community system the non-members of the community are excluded from using the common areas (FOPER, 2007). Open Access, or no-property, where individuals have both privileges and no rights with respect to the resource. In other words, therefore, openaccess resource is a resource whose use is unregulated and

29

unmanaged such that anyone may freely use it without distinction or hindrance (Ellsworth, 2004). Private property is often inaccurately called common property, when communities usually allocate private rights to households for agriculture and some forestry, while keeping some forest under common management (White, 2004). A vast flow of literature, mostly based on the work of Nobel-graduate Elinor Ostrom states that, in several respects, a well designed, well functioning Common Pool Resource (CPR) is like private property (Ostrom & Sclanger 1996, Murty 1994 cited in Sterner, 2002) because when the costs of protecting private property are high or when the yields are low and very variable, a CPR may simply have lower transaction and other costs and thus be more efficient than private property (Sterner, 2002). Common Pool Resources can have costly exclusion, but the goods produced with these resources are consumed individually (as private goods). Free riding and other mechanisms that lead to the undersupply of public goods may also lead to the overuse of CPR, giving rise to Hardins Tragedy of the commons (Hardin, 1968), unless institutions are strong enough to limit access by the users. When referring to forest property regimes, using a simplification we can distinguish between two basic legal categories of property in use in the world today: public and private (White, 2004). Public ownership is all lands owned by central, regional, or local government (White & Martin, 2002, FOPER, 2007). The public category is further divided into two subcategories, and this distinction is particularly relevant in tropical forest areas: lands administered by government entities and lands set aside or reserved for local communities, including indigenous groups, on semipermanent, but conditional, basis (White & Martin, 2002; White, 2004; RRI and ITTO, 2009). The first category typically includes all forests in the legal forest estate that are owned and administered exclusively by the government and that are not designated for use by communities or indigenous peoples, for example protected areas and forest lands awarded as concessions for logging, agroindustrial or silvicultural plantations, and mining (RRI & ITTO, 2009). In this latter category, governments retain ownership and the entitlement to unilaterally extinguish local groups rights over entire areas. Under this arrangement, local groups typically lack rights to sell or otherwise alienate land through mortgages

30

or other financial instruments (White & Martin, 2002; White, 2004; RRI & ITTO, 2009). Private ownership category is also subdivided into two categories: forest areas owned by indigenous and other local community groups and those owned by private individuals and firms (White & Martin, 2002; White, 2004; RRI & ITTO, 2009). Private ownership is held by individuals, groups of people, or corporate bodies (FOPER, 2007) over a specific area that cannot unilaterally be terminated by a government without some form of due process and compensation (White & Martin, 2002). Similarly, private lands owned by communities or indigenous peoples refer to forest lands where rights cannot be unilaterally terminated by a government without some form of due process and compensation.(RRI & ITTO, 2009). In theory, private landowners typically have rights to access, sell or otherwise alienate, manage, withdraw resources and exclude outsiders. (White & Martin, 2002). Communities that hold private rights generally have more leverage when negotiating with governments or outsider investors and much stronger claim to the benefits of ecosystem services and opportunities generated by their forests as well as control over more traditional uses than do communities on public land (White & Martin, 2002; White, 2004; RRI & ITTO, 2009). However, in the real world, there are some situations where not all of these rights are awarded to private landowners, and others where some of these rights are conferred to people on public, designated for community-use forest land. In many cases where private lands are said to be owned by communities or indigenous peoples, under statutory law, the state is considered to be the ultimate owner, though the communities and indigenous peoples are recognized as the lawful right holders (RRI & ITTO, 2009). It is clear, therefore, that the simple distinction between public and private forestland ownership is not enough to allocate all the different existing forest management regimes which can be found in forestry, and that a broader framework is necessary, as shown by the work of Romano, ButtoudKouplevatskaya, & Reeb (2010) reported in Box 4.

31

Box 4. Possible Forest Management Regimes (Romano, Buttoud-Kouplevatskaya, & Reeb, 2010) Owner is the manager The owner retains management rights and responsibilities within the limits specified by legislation Owner is the exclusive The owner is the sole manager of the resource(s), no subsistence or manager, no extraction commercial use/extraction rights are allocated/granted to others rights for others Non-commercial, user User rights allocated to satisfy local peoples needs for forest products rights, customary rights, and do not allow commercialization by the users. Such rights might be permits to hunt, gather dead regulated through licences and permits wood and NWFPs Forest management Forests in which the management decisions remain solely with the through contracts or owner, but management activities are executed by a different group partnerships with the owner according to an agreement. Include forests allocated for extraction purposes through licences or timber concessions. Property and management rights are not transferred Joint forest management Forests where management with local communities foresee a degree of with communities, devolution in the execution of forest operations. The agreements community timber allocate temporary exploitation rights for specific forest products or other concessions or licences activities. Local communities may be given licences or short term concessions to harvest for commercial purposes. Joint/collaborative management does not alter the ownership state, and includes a negotiated transfer of benefits. Private company permits Agreements allocate temporary rights for specific forest products or forest harvesting licence activities. Usually private companies are given licences or short-term scheme concessions to harvest for commercial purposes. Also includes partnerships between private processing companies and smallholders for the production of commercial forest products from private or communal forests (out-grower schemes) Devolved management Includes forests in which management is devolved to a group other than rights the owner. Agreements are usually renewable, and convey many rights, but overall property rights remain with the owner Community forest leases, Forest managed by local communities according to leases or forest management management agreements, usually for more than 10 to 20 years, with agreements management, user rights and responsibilities and some property rights transferred to the communities Private company leases, Forest managed by private companies according to leases or forest management management concessions, usually for more than 10 to 20 years, with concessions management rights and responsibilities and some property rights transferred to the companies Others Forests that do not belong to any of the management categories mentioned above

32

2.4

Forest tenure, tenure security and its importance in REDD implementation

In order to connect with the above discussion over property regimes, we may argue that tenure is, to a certain extent, a synonymous to property regimes, as the concept is said to refer to the system of rights, obligations, rules, institutions and processes regulating resources access, use, control, and transfer, as well associated responsibilities and restraints (Bruce, 1998; Dunlop, 2009; NRLA, 2009, SIDA cited in Romano, Buttoud-Kouplevatskaya, & Reeb, 2010). Originally, the word was taken from English feudalism, derived from the Latin word tenere meaning holding or possessing (Bruce, 1998; Ellsworth, 2004); the Oxford English Dictionary adds tenure is the action or fact of holding anything material or nonmaterial and also allows for tenure to mean terms of holding or title (Ellsworth, 2004). To a certain extent, however, the concept of tenure, and especially that of land tenure seems to go over and beyond that of property regimes, involving relationships among people with respect to land and its resources and implying reference to complex social institutions based on both tradition and custom as much as formal law or a combination of the two (Dunlop, 2009; NRLA, 2009). Therefore it can be considered also a reflection of power structure in a society because land and other natural resources are central to social and cultural identity and economic wealth (NRLA, 2009). In addition, it is a key to shaping the distribution of risks, costs, and benefits of financial transfers linked to forest conservation (Cotula & Mayers, 2009). Natural resources tenure is broadly defined as i) the arrangements through which people gain legitimate access to natural resources; ii) the conditions under which they use those resources and participate in the benefits deriving from them; iii) the bundle of both rights and obligations when it comes to using resources in such a way so as to not harm others and when paying taxes, fees, and other duties; and iv) the institutions and process for the management of those resources (SIDA, 2009 cited in Romano, Buttoud-Kouplevatskaya, & Reeb, 2010). In most cases, it also means the duration of those rights over time and across generations (Devlin cited in Ellsworth, 2004; Dunlop, 2009).

Being based on the types of tenure recognized by a national and/ or local system of law taken together (Bruce, 1998), two types of tenure systems can be

33

identified: i) customary and ii) statutory tenure systems. Customary tenure systems are determined at the local level and are often based on oral agreements; statutory tenure systems are applied by governments and are codified in state law (RRI and ITTO, 2009). Therefore, a tenure system cannot be understood except than in relationship to the economic, political, and social systems producing it and influenced by it (Bruce, 1998): eventually, therefore, tenure relies on, and is conditioned by, governance (Cotula & Mayers, 2009). The rules of tenure are applied and made operational through the administration of tenure. This administration, whether formal or customary, addresses the systems and processes to administer: Rights to land and other natural resources, including the allocation of rights, delimitation of boundaries, transfer of rights (e.g. through sale, lease, concessions, sharecropping, loan, gift, inheritance, land reform), and adjudication of doubts and disputes regarding rights and parcel boundaries. The regulated use of land and other natural resources, including planning and enforcement of land use regulations, and adjudication of land use conflicts. The valuation and taxation methods, including assessment of property values, gathering of revenues through property taxation and adjudication of valuation and taxation disputes. These three elements of administration (rights, regulated uses, and values) are interlinked. Changing one may affect the others (NRLA, 2009). The concept of tenure applied to forests implies that tenure includes ownership, tenancy and other arrangements for the use of forests. Forest tenure determines who can use what resource, for how long and under what conditions (Romano, 2006; NRLA, 2009). Security of tenure, defined as the certainty that a person or a community has to continuous use of land or resources, will be recognized and protected against challenges from individuals or the state, largely determines who benefits from natural resources and is an essential prerequisite of any effective forest policy at local level (Bruce, 1998; Dunlop, 2009): tenure security allows the landholders to make decisions (White, 2004), it will give individuals or communities greater leverage in relations with government and the private sector in controlling over, and rights to, return from natural resources (Cotula & Mayers, 2009; Dunlop, 2009).

34

Duration, assurance, robustness and exclusivity have been identified as the main legal elements for secure tenure arrangements (Wiersum & Ros-Tonen, 2005 cited in RRI & ITTO, 2009). The tenure itself may be short, for instance, a lease for one month, but if the leaseholders can be certain that they will be able to keep the land for the one month, then the tenure is secure. This implies confidence in the legal system and lack of worry about loss of ones rights. Security of tenure relates also to the time needed to recover the cost of an investment. When tenure is too short or too uncertain for most investments, economists say that the landholder lacks security of tenure (Bruce, 1998). Lindsay (1998) cited in White (2004) has identified as many as nine characteristics of secure community tenure (Box 5.).
Box 5. Lindsays characteristics of secure community tenure (Lindsay, 1998 in White, 2004) 1. Security requires that there be clarity as to what the rights are 2. Security requires certainty that rights cannot be taken away or changed unilaterally and unfairly 3. Security is enhanced if the duration of rights is either in perpetuity or for a period that is clearly spelled out and is long enough for the benefits of participation to be fully realized 4. Security means that rights need to be enforceable against the state (including local government institutions) that is, the legal system has to recognize an obligation on the part of the state to respect those rights 5. Security requires that the rights are exclusive 6. A corollary to exclusivity is that there must be certainty both about the boundaries of the resources to which the rights apply and about who is entitled to claim membership in the group 7. Another corollary to exclusivity where comanagement concerns government land is that the government entity entering into the agreement must have clear authority to do so 8. Security requires that the law recognises the holder of the rights. 9. Finally, and perhaps most daunting, security requires accessible, affordable and fair avenues for seeking protection of the rights, for solving disputes and for appealing decisions of government officials.

Securing clear land tenure and local access to and control of forest resources are fundamentals to achieve forest conservation, sustainable forest management, social identity, personal security, and cultural survival of indigenous peoples (Jenkins, and ethnic minorities 2007;

2004;

FAO,

Sunderlin et al. 2008; RRI, 2009). It also ensures long-term

permanence of the environmental benefits, as well to leverage

poverty alleviation (International Law Firm Baker & McKenzie cited in Dunlop, 2009; Cotula & Mayers, 2009). Moreover, addressing land and resources disputes and

creating tenure security for all stakeholders can resolve violent conflicts, lay the foundation for

stable and predictable investment, and contribute to national and regional economic growth (RRI, 2009a).

35

Tenure security is also a key underlying issue for REDD (Dunlop, 2009). All initiatives under REDD are expected to secure the recognition and implementation of the human rights of indigenous peoples, including security of land tenure, ownership, recognition of land title according to traditional ways, uses and customary laws and the multiple benefits of forests for climate, ecosystems, and peoples before taking any action (Indigenous Peoples representatives cited in Dunlop, 2009). It can help to address legal uncertainties surrounding REDD projects. This will not only empower forest dependent communities but will also benefit governments, REDD project developers and investors (Dunlop, 2009). Therefore understanding tenure issues and trends is essential for all actors concerned with forests, for governments that seek to promote sustainable use, combat illegal logging and quell local unrest, for indigenous and other local communities and their supporters who want legal recognition of community rights and broader political participation, for environmental organizations that seek conservation without undermining local tenure rights, for sustainable forest management certifying bodies that want to ensure they do not unwittingly reinforce unjust claims, for private industries requiring reliable sources of timber and fibre, and for investors seeking low-risk investment opportunities (White & Martin, 2002). According to White, 2004 (Figure 1), the key elements or building blocks needed to achieve community tenure security include: effective internal institutions of the community, legal recognition and support of community rights, the presence of independent judicial arbitration systems, effective regulatory mechanisms and institutions, and a supporting political constituency.

Figure 1. Elements of Community Tenure Security (White, 2004)

36

As illustrated in Figure 1., these elements connect property rights officially held by communities to the relative security of those rights. Tenure will remain secure even if several elements are absent, so long as internal institutions are in place (White, 2004). This means that, to be successful, tenure arrangements must consider local customs (Romano, 2006; FAO, 2007). The importance of other elements will depend on a number of factors, including the degree to which the government is generally and sincerely supportive of community rights and the degree to which the community interacts with modern economic and financial systems (White, 2004), the availability of funding, the capacity levels of the local stakeholders and the prevailing political structure (FAO, 2007). Furthermore, it also depends on the way national legislation and other systems of resource tenure that may not be reflected in legislation but may enjoy legitimacy for local people are actually applied on the ground (FAO, 2007). Ellsworth (2004b) and White (2004, Figure 2.) stated a number of strategies that have been used with success by NGOs and community-based organization or other advocates for community tenure: 1. Supporting legal activism 2. Mapping of community lands to document customary rights. Regarding this point, White (2004) also suggested to collect data on property claims and ownership at local, regional, and global scales. These data are necessary to formulate and promote arguments for advancing community claims 3. Promoting public education and lobbying to develop a shared understanding of solutions to tenure problems. Regarding this point, White (2004) also suggested to educate government officials and donors on the issues of community rights and the very feasible possibilities for enhancing their livelihoods with tenure reform. 4. Supporting working groups to transform bureaucracies that manage common property. Regarding this point, White (2004) also suggested to link the emerging networks of community tenure advocates to build a concerted international and political

constituency able to leverage new funds, new technology, and new political openness to expand community rights and also develop new partnership with governments and selected multi- and bilateral agencies.

37

5. Strengthening

politically

active

coalitions

of

cause

leaders,

organizations and networks 6. Piloting working models that illustrate successful commons

management 7. Building civic mobilization around better management of the commons. Beside those strategies, in order to achieve tenure security, substantial legal reform accompanied by support to local communities or to small holders in forest management from relevant institutions, and to local authorities (Jenkins, 2004; White & Ellsworth, 2004) can, and often does, improve wellbeing and provide the means to exclude outside claimants and improve forest management and conservation (Lindsay, 1999; RRI, 2009a).

Figure 2. Actors and Actions in securing community tenure (White, 2004)

2.5

Carbon-sequestration rights
Being a component of air, CO2 is certainly a public good, or better a public bad at the root of insurgence of global warming and climate change. Given the free circulation of air into the atmosphere, CO 2 relevance as a public bad has a transboundary dimension, extraneous to country boundaries or, even more, to property boundaries. Through a naturally-occurring photosynthetic process,

38

vegetation is able to sequester Carbon and stock it into growing trees, herbaceous flora and organic matter in soils. This process produces a potential economic good (stored Carbon), a possible new source of income for owners of the land on which vegetation or soils accumulate carbon from atmosphere. The financial value of sequestered Carbon has a meaning where a market for greenhouse gas emission offsets has been created, provided that the conditions for the good functioning of the market mechanisms are respected. One of these conditions imposes that the good exchanged is a private good, that is to say entirely rival and excludable. In turn, this implies that property rights on it are fully defined and allocated. Conflicts arise because, differently from CO2, vegetation grows on land, a land indeed already subjected to a certain property rights regime and tenure arrangements, while it is not clear whom sequester C belongs to. Therefore the ownership of intangible resources such as sequestered Carbon, actual or potential, poses new challenges to the old conception of property and to the old systems of property law (Rosenbaum et al., 2004, Boydell et al., 2009 in press), and this is particularly relevant in the context of REDD programmes, focused on Emission Reduction and related financing mechanisms.

A C-sequestration right can be intended as a form of property right of the benefits and risks arising from carbon absorbed from the atmosphere, sequestration on, and release from a specified parcel of land (Bailey & Rayner, 2001; Cotula & Mayers, 2009). From the economic theory viewpoint, they can be meant, to a certain extent, as the contrary of the traditional right to pollute the environment (Boydell et al., 2009 in press), or as rights of storage as opposed to the more traditional Ostrom and Schlagers (1996) cited in Sterner (2002) rights of withdrawal or Honors (1961) rights of use. They have the characteristics of not being fungible (Robles, 2010; Boydell et al., 2009 in press), in the sense that they cannot be touched, felt, or taken away, whilst the owner of land can instead sell the subsidiary right in carbon sequestration in, for example, trees. At the same time, when third parties are involved in the property right regime, the landowner can be forced to take over him/her self the responsibilities and the restrictions to ensure that his/her activities do not impact on the loss or diminishment of that carbon right (Boydell et al., 2009 in press).

39

The objective in recognizing carbon as property is to provide secure title for carbon sequestration rights through registration on the land title system (Sheehan, 2001). Conceiving Carbon-sequestration rights accurately will have implications on the future institutional arrangements of governments and on national law (Rosenbaum et al., 2004). The legal framework consisting in constitutional provisions, laws, regulations, acts but also contracts must clearly establish who may be permitted to own forest carbon rights. It is a prerequisite to guarantee the control over the circulation and trade of the carbon rights whether in regulatory or voluntary carbon markets. Moreover, the clarification of forest tenure rights, particularly the ownership on forest lands is crucial to determine who will be the parties involved in contracting carbon rights derived from forests (Robles, 2010). The most effective way of formalising and responding to the carbon interest as a property right is through the implementation of specific regulatory provisions detailing the form, content and scope of this unique and important natural resource interest (Hepburn, 2008). Carbon ownership may either be a separate proprietary interest, or a proprietary interest linked to forest or land ownership. If the carbon stock is subject to a separate, alienable property right, independent of the property of the forest, the owner could sell that right without conveying forest ownership. This may happen through the sale of a usufruct right or profit prendre, governed under the laws concerning land ownership or under general property rules. When the ownership of the carbon stock is transferred, new owners may or may not have the right to affect the use of the forest to protect or enhance its existing potential (Robles, 2010). Rosenbaum et al. (2004) have provided a comprehensive picture of possible ownership systems of Carbon sequestration potential from a forest, showing the high complexity of the different approaches to the problem. A modified and adapted version of this picture is presented in Table 1.

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Table 1. A picture of possible ownership regimes of Carbon sequestration potentiall

Obligations towards forest management aimed at increasing Cstock GovernmentForm of obligation regulatory powers between private on landowners parties Contracts Covenants (running with land or persons) Easements Government can have inalienable regulatory power to regulate or enhance C sequestration

C-right ownership regime

Forms through which C-right is sold Profit a prendre Completely new property right established through a covenant Government acts as trustee (profit to landowner Government sells credits (profit to Government) C-rights are chose in action linked to vegetation unless a covenant is signed The owner cannot sell or give C-stock away independently of the property

Private good owned by landowner, governed by landownership laws C-rights separate Public good owned by the Stat (regardless of landownership) Government take credits for C-stock On public land

C-rights proprietary interest linked to forest or to land ownership

Covenants

On private land

Source: Rosenbaum et al. (2004), modified and adapted

In synthesis, the key-elements of possible C-ownership regime are: The separability of the C-rights from land-ownership, which depends much on the countrys legal and institutional framework, especially on what regards the juridical context of land ownership; this aspect has a strong direct impact on the transformation of the C potential into a C-credits and therefore on its tradability: Carbon rights which are verified as separate property interests, enforceable against or over the land, are more readily tradable; they are not encumbered by the management and conveyance burdens associated with the transfer of full corporeal ownership of the land (Hepburn, 2008). The fact that sequestered carbon is considered a private good owned by the land owner or a public good belonging to the society at large The legal possibility of imposing obligations constraining the land owner to follow specific forest management practices specifically aimed towards increasing C-sequestration.

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Three most-frequently occurring solutions can be identified in the following: A. The carbon sequestered in the forest is a private good owned by the landlord, product separate from other forest products, i.e. the object of a separate, alienable property right, such as a usufruct right of the profit prendre type, governed under the laws concerning land ownership. The owner can sell that right without conveying land ownership. In this context, two options may be envisioned: i The owner of the carbon has the right to affect the use of the forest to protect the existing forest carbon stock, or to enhance it; ii The owner of the carbon has no inherent right to affect how the forest is used. However, the land owner may separately grant this right through some legal mechanisms that bind the property owner. These obligations could be in the form of: contracts; covenants that runs with the land, binding anyone who owns the property in the future; covenants that attaches to persons; easements or servitudes, which may attach to a dominant estate or to a person. In the latter case, the carbon sequestered in the forest may be transferred independently of any land transfer. B. The carbon sequestered in the forest is again a separate good from other forest products, but the right is governed under general contract law. In this case, the carbon sequestered in the forest is a publicly owned asset and: The government holds the forest carbon stock as trustee for the benefit of forest owners or of the public, with no power to sell it or give it away. In this context, two different options may be envisioned: The government has no particular power to require landowners to protect or enhance sequestration; or The government has the power to regulate the use of land to protect or enhance carbon sequestration. C. The carbon sequestered in the forest is a proprietary interest linked to forest or land ownership. This means that C cannot be sold independently of the forest. When referring to privately-owned land, the owner may or may not be forced to undertake the obligation to manage the forest in a way to increase the carbon stock.
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B The government has the power to sell or give the forest carbon stock away. In this connection, two main options may be configured: The acquisition of carbon stocks may be open to anybody; Only a limited number of entities may be eligible to own carbon stocks, such as entities emitting carbon and desiring offsets; banks chartered to deal in mitigation credits; NGOs interested in environmental protection; indigenous peoples or other groups of forest stewards. C-policies developers have recommended that establishing C-sequestration ownership in a given legislative context should be guided by a series of steps, presented and discussed in Box 6. These assume particular relevance in the context of the present work, which seeks to understand which is the most appropriate legislative milieu for the development of REDD projects in Indonesia. Furthermore, it needs to be taken into account that the choice of how to shape the nature of property rights in carbon sequestration depends on several factors (Rosenbaum et al., 2004): 1. The framework of existing laws and legal traditions, which will play a major role and may constrain the choice 2. The nature of the local economy: as in the country with or an
Box 6. Steps towards establishing carbon ownership in a given legislative context (from Streck and OSullivan (2007) 1. Check whether there is any definition of carbon sequestration rights in domestic law. 2. Check whether the benefits associated with carbon sequestration are assigned to landowners or to any other subject. 3. Assess what, if anything, needs to be done to protect and maintain unencumbered legal title to the carbon sequestered in a forest. This may include buying or leasing the land, registering certain rights over the land, coming to an agreement with customary owners, or other subjects that may have rights over the land or the forests, or restricting the use of the land or forests to certain purposes for a given amount of time. 4. Check whether or not there are restrictions on the transfer of carbon sequestered in the forest.

unstable

currency

poorly

developed markets, it will be impractical to set up a national system based on tradable rights. 3. The governmental capacity to deal with abstract forms of

landownership. 4. The nature of the demand for

carbon sequestration. If the major goal of a country is to encourage foreign governments to invest in forest based mitigation projects, and government to government dealings are the desired outcome, a system vesting ownership of sequestration in the national government may be appropriate.

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If developed countries adopt laws that encourage individual emitters of GHG to seek offsets, developing countries seeking private investment may wish to vest ownership of sequestration potential in private hands.

2.6

The Australian approach to the issue of Carbon-sequestration rights

Australia was one of the first countries to establish carbon rights as part of land use strategies both within rural and urban areas (Boydell et al., 2009 in press). This country has also developed a concept of recognition of carbon as property right in its legislation system (Bredhauer, 2000 cited in Sheehan, 2001) to formalise the separate proprietary existence of carbon rights within the context of the forestry legislation (Hepburn, 2008). Being a pioneer in C-rights definition, the Australian experience can provide interesting insights in this field and show possible development paths to be applied to our problem. The various Australian States and territories have chosen different solutions to the problem, as shown in Table 2. (reference can also be made to the general framework of Table 1., although the correspondence between typologies is not always straightforward, being the solutions very articulated and sometimes only slightly but substantially different). Legislation in New South Wales, Tasmania and Queensland deems forestry carbon rights as a separate right from the bundle of forest rights, constituting common law profit prendre interests. Types of usufruct rights foreseen imply mostly covenants. Legislation in Western Australia and South Australia articulates the carbon right as a new property interest, constructed around the specific statutory provisions outlined within the legislation. In Western Australia, the proprietary validation of this new carbon right is contingent upon registration of the underlying C-covenant, which can occur on both freehold and Crown land. In Southern Australia, the C potential is considered a chose in action, a potential linked to forest vegetation up to when a forest property agreement is signed to separate it from forest vegetation and giving rise to a new property right. In Victoria, carbon rights are not validated as separate land interests but exist as components of the underlying forest property agreement and therefore remain characterised as choses in action (Hepburn, 2008). Neither the Australian Capital Territory nor the Northern Territory has specific legislative provisions recognising the proprietary status of carbon sequestration rights.

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Table 2. Ownership regimes of Carbon sequestration adopted in Australia and their tradability
Forms through which C-right is sold Form Need for registration Obligations towards forest management aimed at increasing C-stock Possibility of Form of obligation specific between private obligations for Lit Ref. parties forest management Yes, but general maintenance Hepburn, obligations, not 2008; C-Convenants necessarily Robles, 2010; finalised toward Rosenbaum C-sequestration et al., 2004 enhancement Hepburn, 2008; Queensland Government, 2009 Hepburn, 2008; State of Western Australia, 2005

Tradability

New South Wales (and Tasmania)

Queensland

Profit a prendre, a forest-proprietary interest separate from other forest products, subject to common law provisions Profit a prendre, a proprietary interest, incorporated into natural resource products, subject to common law provisions A new property right, statutorily established A chose in action linked to vegetation, unless a forest property agreement is signed to separate C ownership from ownership of forest vegetation, thus becoming a new property right Not an independent right, but a land interest, subcategory of forest property right, established through forestright agreements and subsequent C-right agreements

Possible, but not necessary

Possible (and necessary according to a restrictive interpretatio n of the law) Necessary, can occur on both private or public land (freehold or Crown) Possible but not necessary. Can be used to give priority to cright holder on holders of other rights

lease

Western Australia

C-Convenants

Are established through registration of a C-covenant

Southern Australia

C-Covenant, necessary to separate Cownership from that of forest vegetation

Hepburn, 2008

Victoria

Possible, but not necessary

Contractual, between parties, not running with land, becoming covenant running with land when registered

YES, specific Csequestration enhancement,

Bailey & Rainer, 2001; Hepburn, 2008

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2.7

Identification of research questions

The theoretical analyses on institutional solutions to the problem of C-rights allocation, on forest tenure and its importance in REDD implementation, have highlighted some key-issues in relation to the final objective of the thesis: to assess whether and to what extent REDD projects can be a tool for delivering significant benefits for Indonesian local populations especially through enhancing security of property rights and land tenure regimes. These key-issues, to be intended as research questions, are: a) Is the Indonesian institutional framework of property rights ready for the implementation of REDD? How can this readiness be assessed? From this point of view, what lessons can be learned from countries which have adopted pioneer solutions in this field like for example Australia?

b) Have the REDD projects already in place (both demonstration and

voluntary activities) in Indonesia sufficiently considered the issue of forest rights? And are they effectively contributing towards an improvement of tenure systems for local populations? Clearly, these research questions imply that two levels of analysis are implemented throughout the work: the first one (a) at institutional (broad) scale, the second one (b) at project level. Both level of analysis will contribute to cast light on the most effective patterns of implementation for REDD projects.

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3.
3.1

Research methodology
Case-studies as a research method
Yin (1994) defines the case study research method as an empirical inquiry that investigates a contemporary phenomenon within its real-life context; when the boundaries between phenomenon and context are not clearly evident; and in which multiple sources of evidence are used. In most cases, a case study method selects a small geographical area or a very limited number of individuals as the subjects of study (Zainal, 2007). One of the reasons for the recognition of case study as a research method is that researchers were becoming more concerned about the limitations of quantitative methods in providing holistic and in-depth explanations of the social and behavioural problems in question. Through case study methods, a researcher is able to go beyond the quantitative statistical results and understand the behavioural conditions through the actors perspective. By including both quantitative and qualitative data, case study helps explaining both the process and outcome of a phenomenon through complete observation, reconstruction and analysis of the cases under investigation (Tellis, 1997 cited in Zainal, 2007). The case study method is useful particularly in studies of reallife situations governing social issues and problems (Zainal, 2007). Case studies are considered useful in research as they enable researchers to examine data at the micro level. As an alternative to quantitative or qualitative research, case studies can be a practical solution when a big sample population is difficult to obtain. In addition, they present data of real-life situations and they provide better insights into the detailed behaviours of the subjects of interest (Zainal, 2007). In contrast, case studies have received some criticisms. First, case studies are often accused of lack of rigour and the tendency for a researcher to have a biased interpretation of the data (Yin, 1994; Zainal, 2007). Second, case studies provide very little basis for scientific generalisation since they use a small number of subjects, some conducted with only one subject (Yin, 1994; Tellis, 1997 cited in Zainal, 2007).Third, case studies are often labelled as being too long, difficult to conduct and producing a massive amount of documentation (Yin, 1994).

47

Based on the argumentation above, this study was decided to operate through case study because the method provides holistic and in depth explanations of social problem including tenurial and property right issue without depend on statistical result. The method also enables data examination at micro level represented big sample of population; in this case all on-going REDD projects in Indonesia. Therefore, although full inventory could not be conducted; reliable data which covered many possible situations is able to be obtained in cheap way.

3.2

Criteria for choosing case studies

The conducted study was focusing in Indonesia with a reason that Indonesia is one of the main players on REDD+ discussions and in 2008 became the worlds first country to design a legal framework for REDD (Creagh, 2010). The criteria according to which case-studies have been selected are: 1. To have a good spatial representation i.e. to select case studies able to capture the geographic distribution of projects across the archipelago in Indonesia, 2. To consider both demonstration and voluntary activities which have different policy in handling tenurial and property rights issues, Demonstration activities refer to pilot projects with a clear objective to directly reduce emissions from deforestation and degradation in a specific geographic area (Wertz-Kanounnikoff and Kongphan-Apirak, 2008 cited in Madeira, 2009). In Indonesia, the term refers specifically to the few pilot projects that have received official approval by the government of Indonesia (Madeira, 2009). The aim of the

implementation of demonstration activities is to test and develop methodologies relating to reduce carbon emission through controlling deforestation and forest degradation (Masripatin et al., 2010;

Scheyvens, 2010). Maximum period for a demonstration activity is 5 years (Scheyvens, 2010).2

Based on an analysis of responsibilities of the three strata of government Demonstration Projects should be undertaken at four levels of potential future activity: 1) National (for example with land management units managed from national government, e.g., National Parks), 2) Province (forest activities in areas that cross districts, e.g. HPH, Tah ura), 3) District (forest activities that occur within a district (HPH, community forest area, oil palm estate and HTI), 4) Project (for example with forest management units such as individual HPH, HTI, estate crop plantation, or community based HTR)

48

In the other hand, voluntary activities3 are driven by social responsibility concerns to reduce emissions Individuals, corporations and other organizations without mandatory emission targets may enter into these markets. 3. To consider both site level intervention and landscape level intervention Site level interventions aim to generate emissions reductions based on slowing or stopping DD in a localized area. The forest areas are geographically contiguous, will be managed as one homogenous area, and have the same legal classification at the end of project. They range from 10,000 ha to 200,000 ha with an average size of approximately 80,000 ha (Madeira, 2009). In contrast, landscape level interventions aim to generate emissions reductions across a heterogeneous landscape where forest type, legal clarification, and deforestation drivers vary. It may incorporate a very large area in which several measures are undertaken to reduce emissions, but the area affected by those measures is much smaller that the reported project size. They are much larger than site level interventions (Madeira, 2009). 4. To consider case-studies which could be expected to have relevant tenurial issues or have produced information on tenure, and 5. To consider case-studies having, as much as possible, accessible project documents and possibility to establish contacts with project leaders, project managers and NGOs involved in it. Based on these criteria, five REDD projects, of which three demonstration activities and two voluntary activities were selected as focus of study, namely: 1. REDD in the Ulu Masen Ecosystem, Aceh (voluntary activity, landscape level). 2. Tropical Forest Conservation for REDD and enhancing carbon stocks in Meru Betiri National Pak, East Java (demonstration activity, site level). 3. Berau Forest Carbon Program (BFCP), Kalimantan (demonstration activity, landscape level).

In these activities: the projects set their own commitment in achieving emission level; motivations for implementing projects are social and environmental co-benefits; less central government involvement because transactions are more likely to be between international buyers and projects, rather than with national governments as seller themselves and activities are not accordance with government objectives; and do not dependent on international negotiations (MoFor, 2008).

49

4. UNREDD Carbon Project in Central Sulawesi (demonstration activity, landscape level). 5. REDD project by WWF in Jayapura Regency, Papua (voluntary activity, landscape level). Each one of the chosen projects has diversity of actors driving project development (such as private project developers, NGOs, and bilateral aid organizations), diversity on REDD type (national based or project based), diversity on scale and scope, also has made official agreements with some level of the Indonesian government to develop REDD+ activities. These selected projects are part of REDD projects that are used in study of Dunlop (2009) and Sills et al. (2009).

REDD in

Ulu Masen
BFCP, Kalimantan REDD in Papua

REDD in Meru Betiri NP

UNREDD in Central Sulawesi

Figure 3. Location of the five case-studies (modified from Sarsito, 2010)

3.3

Data collection
In order to achieve the thesiss objectives, the approach to information collection was based initially on secondary sources of information and then on field collection of primary data which have to be collected on site. Secondary sources of information used in this study are published literature (journal articles, reports, etc.) from recognized organizations and other credible official sources regarding REDD+ mechanisms; institutional/legal context in Indonesia,

50

tenure system, rights, property rights, property rights regime, carbon rights issues and finally project documents from selected REDD projects. Those secondary data are used for understanding current tenure situation and institutional/ legal context in Indonesia regarding tenure and REDD. Primary data were collected through interviews using a semi-structured questionnaire (see Annex 2 for details of the questionnaire), aimed at collecting information on issues on which there isnt sufficient published literature (specifically, information on tenure system and other challenges on project site, projects conflict management mechanism, stakeholder participation, and benefit sharing mechanisms). The questionnaire has been specially designed for representative of project developers after discussing with some experts on this issue in FAO headquarter and having feedback from pilot questionnaire. The questionnaire is organized in four parts. First, the respondents were asked to provide general information of REDD project (area of project, type of project, objective, main components, main challenges, etc.), tenure system and community access in REDD project site. The second part is designed to get information about the REDD scheme and how tenure system is expected to affect the implementation of REDD. In the third part, respondents were asked to give information about benefit sharing mechanism and how tenure issue are affecting this mechanism. The last part is designed to get information about REDD influence in triggering tenure reform and possibility to have different rights for land, forest, and carbon in Indonesia as established in Australia. All interviews was conducted through phone and email directed to project proponents. Contact with all representatives of project developer was established by using FAOs network. All interviews were conducted once for every respondent. Although there was no specific criterion established a priori for selection of respondents, attention has been paid to have, as respondents, people who are in charge of representing the project or to appear as primary contact written in project document. Total interviewed respondents are five; four were interviewed through phone and one through email: 1. Representative of LATIN, one of main actors of REDD project in Meru Betiri National Park, was interviewed through phone on 16 June 2010. 2. Representative of REDD project in Jayapura Regency was interviewed through phone on 26 June 2010.
51

3. Team leader of BFCP, Kalimantan was interviewed through phone on 30 June 2010. 4. Representativeof UNREDD in Central Sulawesi was interviewed through phone on 2 July 2010. 5. Representative of FORDA, one main actors of REDD project in Meru Betiri National Park, answered the questionnaire on 2 July 2010. Only five questionnaires were obtained in the end although it was supposed to have initially seven interviewed respondents. Due to time constraint, inability of respondent to be interviewed, and some other factors beyond control, representative of REDD project in Berbak National Park, Jambi was not able to finish answering all questions and Chief of Task Force REDD in Aceh, representative of REDD project in Ulu Masen, was not able to fill the sent questionnaire. Dispite there is no interview result for REDD Project in Ulu Masen, this project is still selected as one of case studies since it was the first REDD pilot projects in Indonesia to take voluntary market approach and the first REDD project in developing country to meet CCB standards (Atmadja & Wollenberg, 2010). Therefore, study on this project is conducted by using project documents and validation audit report by SmartWood.

3.4

Data analysis and limitations

The primary data was crosschecked with available project documents to ensure consistency of information. Data collected in this research has been prepared for analysis paying attention to both qualitative and quantitative data. Then they have been analysed mostly using pattern-matching techniques (Yin, 1994). The key property rights aspects of the expected patterns have been described in Chapter 2. References is also made to the implementation of carbon rights in Australia, considered as a possible model to adjust/ reform current Indonesian system to be fit to work with REDD. In addition, readiness of Indonesian institutional in implementing REDD in terms of property rights assignment and land tenure is analyzed by confronting information available with concept of better implementation of REDD in national level by Streck (2009). Secure tenure and property right issues have been confronted with the concept of elements of community tenure security developed by White (2004) which again already described in Chapter 2. In assessing project performance in terms of property right security, interview results and some more information from project
52

documents have been confronted with the adopted and modified criteria of REDD+ Social and Environmental Standards by CCBA and CARE International (2010) described in Chapter 5. The more the options fulfil the element of community tenure security and criteria of REDD+ Social and Environmental Standards, the greater chance of the options to secure tenure and property right. The study methodology has some limitations which should be acknowledged: due to time restrictions and inability to visit the case-studies site for direct observation, from six sources of evidence that should be collected in case study methodology (documents, archival records, interviews, direct observation, participant observation, and physical artefacts) (Yin, 1994), only three sources of evidence are collected in this study. In addition, data about property rights and tenure security on REDD projects in Indonesia will only focus on five selected REDD projects. Overall, the study is conducted based on desk analysis of some documents, literature review, analysis of project records, and gathering completing information from interview of some key stakeholders. Despite these limitations, it has been able to provide interesting grounds for analysis and discussion.

53

54

4.
4.1

Indonesia: current realities

Indonesia at glance
Indonesia is a unitary republic with some provincial autonomy; democratic system divides power between the president and parliament (CIA, 2009). It comprises more than 17,000 islands, of which 6,000 are inhabited; they are spread out over 5,000 km from the Indian Ocean to the Pacific Ocean at the equator (Chrystanto & Justianto, 2003; CIA, 2009). Among those islands, there are 5 large islands like Sumatra, Java, Kalimantan, Sulawesi, and Papua. It covers 5,070,606 sq km area which is consisting of 1,904,443 sq km land area and 3,166,163 sq km sea area (Martin, 2010). Indonesia is administratively divided into 33 provinces which consists of 30 provinces, 2 special regions (daerah istimewa), and 1 special capital city district (daerah khusus ibukota) (CIA, 2009). Each province is subdivided into district and municipalities, which are further, subdivided into sub-districts (kecamatan) and village groupings (either desa or kelurahan).

Figure 4. Map of Indonesia (http://www.lib.utexas.edu/maps/middle_east_and_asia/indonesia_pol_2002.jpg) With a population of around 240 million people (US Census Bureau 2009 estimate), it is the world's fourth most populous country (Martin, 2010). Java and Madura are the most densely populated areas and the largest cities are Jakarta (8.9 million), Surabaya (3 million), Bandung (2.7 million) and Medan (2.2 million) (CIA, 2009).

55

Indonesias people are extremely diverse in culture, language, ethnicity and religion. Around 300 distinct language and ethnic groups populate the archipelago. The national language is Indonesian (Bahasa Indonesia) and nowadays English has become second language. Most communities of Indonesians are related to people of eastern Asia and Malay family, but most people in eastern islands are Melanesian, while there are also significant communities descended from immigrants including Chinese, Arabs, Indians and Europeans (CIA, 2009; Britanica, 2010). Almost 88% of Indonesians are Muslims. Christians are only 8 % and they are majority in few regions such as East Nusa Tenggara, North Sumatra and North Sulawesi. Hindus are only 2% from total population and they are mainly concentrated in Bali and small minority also found in Central and East Java. Buddhist is 1% and mostly they are Chinese descent (CIA, 2009). Lying along the equator, Indonesia has a tropical climate, with two districts monsoonal wet and dry seasons. It is hot and mostly dry from April to October. From November to March it is slightly cooler, but very humid and torrential rain and storms are common (CIA, 2009).Average annual rainfall in the lowlands varies from 1,780 3,175 millimetres (70 -125 in) and up to 6,100 millimetres (240 in) in mountainous regions (BBC, 2010). Indonesia is the largest economy in Southeast Asia and also a member of G-20 major economies. Indonesias estimated Gross Domestic Product (GDP) per capita for 2009 is $4,000 (2009 estimates). Agriculture contributes 15.3% for the GDP, industry 47.6% and services 37.1%. Labour force is 113.3 million (2009 estimates) (CIA, 2009).

4.2

Forest in Indonesia
Indonesia is counted as one of three largest tropical forest countries after Brazil and Democratic Republic of the Congo. According to FAO Global Forest Resources Assessment in 2005, forest covers 48.8 percent of Indonesian total land (88,495 million hectares) (FAO, 2006) which consists of a mixture of high, medium, and low-density planted and non-planted forest. The forests are mostly found in the outer islands of Sumatra (18.77 percent of total forest cover), Kalimantan (31.99 percent), Sulawesi (9.52 percent), and Papua (30.99 percent) (Sardjono, 2004a cited in Simorangkir & Sardjono, 2006). Between 1990 and 2000 the annual net loss of forest area was 1.7 percent while between 2000 and
56

2005 it was increasing into 2 percent (FAO, 2006; 2007). This situation also links with reduction of growing stock which between 1990 and 2000, was 3.33 m 3/ ha/year and between 2000 and 2005 was 4.61 m3/ ha/year (FAO, 2006). All forest land in Indonesia is owned by the state. Public forest administered by government in 2002 was 104 millions of hectares and 0.60 millions of hectares of the forest area were designated for use by communities and indigenous groups. There was no forest area owned by private in 2002 for both group individual and firms and communities and indigenous groups. Government data on forest cover (2004) indicated that there are approximately eight million hectares of forest located in non-forest zones. These can be categorized as private forests that could be owned by communities as well as by companies (Fey, 2007). In 2008, public forest administered by government was increasing into 121.89 millions of hectares. In the other hand, public forest designated for use by communities and indigenous groups was decreasing become 0.23 millions of hectares through classifications including: collaborative management of protected areas; community forests; community forest plantations and customary forests. These land use zones are designed to increase the economic stake which local people may have in the national forest estate and to thereby promote greater levels of community based forest protection as a means of combating illegal (Fey, 2007; MoFor, 2008). Communities have also been granted licenses for commercial utilization of forest areas, timber and Non Timber Forest Products (NTFPs) as well as licenses for collecting timber and NTFPs (thus having more certain legal tenure) over 73,309 hectares (Fey, 2007). During 2008, there was improvement in private forest ownership. There was 1.71 millions of hectares of forest owned by individuals and firms however, there was still no forest owned by communities and indigenous groups (RRI, 2009).

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Figure 5. Forest management models for local community participation (Sardjono, 2004b in Simorangkir & Sardjono, 2006) The forest land is designated into three primary functions. 1. Production forest In 2005, this forest covers 53.9 percent of total forest coverage or about 47,707, 000 ha (FAO, 2006). Production forest is divided into two secondary categories: a. Permanent production forest for which sustainable forest

management is intended to maintain forest ecosystems within the forest estate. Permanent Production Forest is managed as: Natural Production Forest (Hutan Produksi Alam HPA), Limited Production Forest (Hutan Produksi Terbatas HPT); and Industrial Plantation Forest (Hutan Tanaman Industri HTI). The utilization of the production forests is undertaken through forest concessions that are granted to private companies, individuals, cooperatives,

communities, or state enterprises concerned with the forest sector. Concessions are granted for 20 to 55 years over natural forests and for up to 60 years over HTI (MoFor, 2008; Masripatin et al., 2009). b. Convertible Production Forest (Hutan Produksi Konversi HPK). This forest zone is not intended to remain in the State Forest but can be

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converted to other non-forest uses, such as agriculture, estate crops (e.g., coffee, oil palm, rubber) and settlement. The decision to release HPK from the forest estate is subject to ministerial approval based on proposals from industry (MoFor, 2008; Masripatin et al., 2009) 2. Protected forest. Protected Forest has been set for the preservation of essential ecosystem functions, such as watershed protection and protection of beachfronts, riversides and steep upper slopes of mountains where uncontrolled human activities or logging could easily create critical land through erosion (MoFor, 2008; Masripatin et al., 2009). Limited human activities are permitted including the taking of rattan and the secondary forest products at non-commercial scales. The management of Protected Forests has been devolved to Local Government (Kabupatan/ Kota), which have rights to license use of and payments for environmental services (MoFor, 2008). It covers 27.5 percent of total forest coverage or about 40,788, 000 ha in 2005 (FAO, 2006). 3. Conservation forest. These include a range of protected area types specified in Act No.5 of 1990. Their major purposes are to conserve biological diversity, ecological processes, nature-based tourism, and the source of genetic resources needed for food crops, medicinal plants, wood and non-wood forest species domestication (MoFor, 2008; Masripatin et al., 2009). The types of protected areas are: National Park, Strict Nature Reserves, Wildlife Sanctuaries, Recreational Parks, Grand Forest Parks and Hunting Parks. Each of these types of protected area is managed directly under the authority of the central government. A further protected area type of grand forest park, termed TAHURA or Provincial Park, has been identified in a number of provinces by the Ministry of Forestry, and its management allocated to provincial government. National Parks form a distinct type of protected area because unlike all other categories they are managed by staff dedicated to the NP, and they have their own budget allocation (MoFor, 2008). It is about 40,788,000 ha (18.6% of total coverage) (FAO, 2006). Beside primary forest, Indonesia has 36,394,000 ha semi-natural forest and 3.4 million hectares of forest plantations (about 3.8 percent of the forest area) (FAO, 2006; 2007).

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Forestry sector has been a major contributor to the national economy over the last three decades, accounting for almost 10 percent of total gross domestic product (GDP) (Simorangkir & Sardjono, 2006). However, poor forest governance, overcutting of forests, cutting in unauthorized areas and theft, mining in forest land, industrial plantations (e.g. oil palm, timber for pulp and paper), small scale community-based agriculture (e.g. rubber, caco, and coffee), forest conversion to other uses, and uncertainty in property rights and forest policies cause deforestation and forest degradation. Nationally, rates of forest loss have exceeded 1 million ha per year for the last three decades and have approached 2 million ha per year in recent years (Simorangkir & Sardjono, 2006; Colchester & Fay, 2007). Beside those illegal activities, Fey (2007) also states that there are several problems that Indonesian forestry is still dealing with: forest fires which occur throughout the country particularly in Sumatera and Kalimantan; unstable forest zones due to spatial planning processes; not all forest zones have management units nor community-friendly forest utilization approaches; large number of poor people living in and surrounding the forest; high demand for forest land from other government agencies, and un-conducive investment policies for forestry development. Therefore, strong will and big effort from government to tackle those problems are needed.

4.3

Land and forest tenure system in Indonesia

Under the Dutch, a dual system of land laws permitted non Indonesians to register and obtain title for lands on the basis of Western civil law principles, whereas Indonesian ownership was governed by adat (custom), based on unwritten village practices (Box.7). The dual system was intended to protect peasants from alienation of their land. However, the more flexible, communal based adat system also permitted the Dutch to rent communal village lands by contracting only with the village headman (penghula) (Frederick & Worden, 1993).

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The Basic Agrarian Law (BAL) of 1960 was the first major legislation provides the principles and direction for government action on agrarian reform and national forestry legal and policy development yet legal options for the communities continue to be primarily directed towards sharing management responsibility over state forests (Fey, 2007). The BAL provides for the recognition of individual rights to use and own lands and for business tenures as long term renewable leaseholds. Under BAL, customary land rights are also
Box 7. Adat regulation in managing forest (Deschamps & Hartman, 2006) Adat is set of traditional laws created by the community and administered by a local council of adat elders that regulate nearly all aspects of life in the community, and are not necessarily restricted to natural resources use. These regulations include both traditional and legal laws, and control the rights, responsibilities, and legal sanctions of people residing inside and outside of the host community. Adat details rights and responsibilities with regards to resources extraction. It also defines the size, location, area boundaries, and harvest locations of forest products . These are based on the principle that residents have equal rights to a healthy environment, namely use and protect the community forest and participate in the planning, implementation, and planning process. Extraction of forest products from traditional use area is restricted to resident of host community. Although private holdings are not permitted in the forest, individuals may lay claim (hak milik) for the use of land, or even specific trees, within the area with permission from the appropriate representative. Often this right can be passed along to family members or traded/sold to other members of the same village. In the case of dry-field gardens, the right of use may be taken away from the user and redistributed among other residents of the host community, at the direction of the Adat council, should the area remain unused for an extended period. Amendment of adat must go through the adat council before being approved. Adat are developed by the residents of the host community, there is no need to seek outside approval of the plan unless it involves major expansion of the land base. However, before changes to the adat are made, extensive discussions of the nature and need for the change must be held before an adat council makes a decision.

legally protected only so long as customary systems still exist and their exercise is consistent with the

national interest and with legislation (Colchester et al 2006 cited in Cotula &

Mayers, 2009). The BAL also recognises the

collective rights in land of customary law communities but threats as weak

usufructs on State lands subordinate to State plans and interests (Colchester & Fay, 2007). are The also

communities

allowed to register their land as they see fit. (Thornburn, 2002). In addition, the law recognizes previous

ownership rights under both adat and Western systems, but provided a new certification process under which land was to be surveyed, mapped, and registered. All unclaimed land reverted to government ownership. Land certification, however, was not compulsory and registration was still far from complete by the end of 1980s. In addition, the law set limits on the size of land ownership, depending on the population density of the region and the type of land (Frederick & Worden, 1993).

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The implementation of BAL is amplified Article 33 of the Indonesian Constitution, which states Land and water and natural riches therein shall be controlled by the state and be made use of for the greatest welfare of the people (MacAndrews, 1986 cited in Thornburn, 2002; Simorangkir & Sardjono, 2006). This gave the government of Indonesia authority to control, regulate and manage forest land and resources, for purposes of national good social function (MacAndrews 1986 cited in Thornburn, 2002). Since implementation of the law, Indonesia has divided its land area into two for administrative purposes: the national forest land, Hutan Negara, and non forest land (MoFor, 2008). The Ministry of Forests has the responsibility to determine which parts of Indonesia are forests and assign them to the category of forest areas (kawasan hutan) and then determine which areas are rights forests and which are state forest areas through the process of gazettement4. Following the gazettement, the ministry then has the authority to lease concessions within State forest areas to individuals, private companies, cooperatives and state owned enterprises (Deschamps & Hartman, 2006). The Act and Forestry Law No.5/1967 led to the declaration of all forest land in Indonesia and untitled land, whether on public or private lands, are state forest land and subject to jurisdiction of the Ministry of Forests (Thornburn, 2002; Colchester, 2004 cited in Deschamps & Hartman, 2006; Cotula & Mayers, 2009). Deforested land could be included as official forest land area if it was designated for reforestation. (Simorangkir & Sardjono, 2006). Technically the National Land Administration Agency (Badan Pertanahan Nasional) has responsibility for the tenure of all land, land surveying and the issuing of entitlements. Enclaves of rural and forest dwelling people within the state forest have been accommodated in a number of ways since the 1967 Basic Forest Law (MoFor, 2008). Private ownership is proved by personal landownership certificates or specific institutions, a few of which the government acknowledges as being equivalent to communal permanent rights, such as customary land (Simorangkir & Sardjono, 2006). Certified rights to land were granted for only 20 years, so certified forest land was meant to be returned to the State in 1980 (Simorangkir & Sardjono, 2006). Currently, there
4

Gazettement refers to the publication of an official announcement in as state gazette or official journal. The event or decision announced is thereby deemed to be public knowledge. Many laws require that such publication is made before a decision of the government may have legal effect. As far as forests are concerned, gazettement usually indicates that a forested area has been designated for protection by the state or other public authorities according to relevant legislation in force (Leonard & Longbottom, 2000). 62

are different types of documents and rights (hak) that exist: hak milik (right of ownership), hak guna usaha (right of exploitation), hak bangunan (right of building), hak pakai (right of use), hak buka tanah (right of opening up land), hak bagi hasil (sharecropping rights), hak menempati (right to occupy), also hipotik, crediet verband (mortgage and credit security arrangements still referred to in the original Dutch) and the array of girik, ketitir, Leter C (proof of ownership documents maintained by village governments in most of Java and parts of Sulawesi, also dating back to the colonial period), and a mind-boggling variety of tax register documents (Thorburn, 2002) still exist. The confusing landownership and rights regime has led to many land tenure conflicts. In the early 1980s, a process named TGHK (Consensual-basis of Forest Land Use) allowed forest boundaries to be designated through desk studies and consensus among government agencies (Simorangkir & Sardjono, 2006; Fey, 2007). The final TGHK of each province approved by the governor and the minister included maps delineating all the forest land areas in each province according to their classification (Simorangkir & Sardjono, 2006). The accuracy of TGHK has always been questioned (Fey, 2007), it was developed and applied in a top down manner that did not involve local stakeholders. Many long established forest dependent communities suddenly found that they lost their rights to the land and/or their traditional access to land and natural resources. (Simorangkir & Sardjono, 2006). The TGHK also became problematic with the introduction of the Provincial Spatial Planning (RTRWP). Lack of skill, and the vested interests of sectors such as forestry, agriculture, mining, and transmigration have resulted in overlapping and conflicting land allocations and uses between forest and non-forest zones as mentioned in both the TGHK and RTRWP (Simorangkir & Sardjono, 2006; Fey, 2007). Hence, in 1999, the government synchronized the TGHK and RTRWP. The ministry of forestry began to re-gazette forest land areas in collaboration with local authorities, taking RTRWP into account (Simorangkir & Sardjono, 2006). This resulted in the Paduserasi or the harmonization of TGHK and RTRWP. The 120.35 million hectares designated as forest zones are the product of such consensus. (Fey, 2007). By July 2003, both TGHK and RTRWP had been synchronized in all provinces except North Sumatra, Riau, and Central Kalimantan (Simorangkir & Sardjono, 2006). Furthermore, to minimize land use conflicts among different authorities and stakeholders, land use allocation based on harmonization

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between TGHK and RTRWP may need further consultation with district governments (Chrystanto & Justianto, 2003). Under the 1999 Basic Forestry Law (replacement of Basic Forestry Law of 1967), the primary source of authority and guidance for all forest administration and regulations and legal basis for forest land use planning, forests are classified and delineated under the jurisdiction of the Forestry Department which has the authority to assign certain areas forested or not as forest zones, or to change the status of such forest zones into non-forests and to zone forests according its functions to whether they should be for production, protection, conservation or conversion (Chrystanto & Justianto, 2003; Colchester & Fay, 2007). Article 5 of the law sets out two types of forest tenure: state and titled, and established procedure for deciding which they are, the results being declared through gazettement (ITTO, 2005; Colchester & Fay, 2007). 1. State ownership State forests are forests located on land without private rights. State forests are designed for production (timber and non-timber), protection or conversion (e.g. to food crops, settlement). The majority of Indonesias land area has been classified as State Forest Zone. This land is under the jurisdiction of the Ministry of Forestry (Cotula & Mayers, 2009). Once land is released from the Forest Estate it becomes subject to land use decisions which are largely in the hands of local governments (Kabupaten/Kota) and are subject to a regulated process known as spatial planning, whereby land is allocated over a 5-year time frame and within 25 year long term strategic plans to contribute to economic and social development (MoFor, 2008) 2. Private ownership Private ownership of forestlands, whether individual or collective, is provided based on Indonesian legislation. In theory, such ownership rights, should give forest peoples a maximum level of control although in all cases there are provisions for such rights to be removed by the state for public purpose on payment of compensation (Cotula & Mayers, 2009). Private land ownership may be very limited in practice. This is due to the long and cumbersome procedures required to establish private ownership, namely land registration.

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Land ownership may not automatically translate into tree ownership (Cotula & Mayers, 2009) and vice versa. Those who hold rights to forest resources cannot claim rights over the land. This means that there are different property rights on land and forest resources. Indonesian land law recognizes this as the horizontal principle of property rights. This is a common practice in the customary land tenure system as well (Fey, 2007).
Box 8. Forest Zones vs State Forests (Fey, 2007) There are several misleading concepts about forest zones, state forests, and the jurisdiction of the Ministry of Forestry (MoFor). First, MoFor assume that all land within the forest zone is state forest. This is the legacy of the old Indonesian Forestry Law (Law 5/1967), stating that state forests are forest zones and forests located there can hold no-ownership rights. The new Forestry Law state that the state forest must have forests on it as defined by the law. Therefore, state claims on non-forested land is legally inconsistent. Second, the existing Indonesian forest zones are legally problematic. The law states that, in order to provide legal certainty to the status of forest zones, the government undertakes forest gazettment (pengukuhan hutan) a process that consists of a series of stages, including forest designation (penunjukan kawasan hutan), boundary demarcation, mapping, and stipulation of the final legal status of forest zones. As of 2005, only 12 million hectares or 10% of forests have been legally declared as forest zones. The remaining 108 million hectares are still at the status of designation, which is merely the initial stage of declaring certain areas as forest zones. After the designation stage, which is a onesided decision of the government, there must be a delineation process for verifying whether the land is free from other individual or community claims. Only after the land is free from such claims can it be declared as state forest zone. Obviously, when the status of 108 million hectares is in the designation process, there is no guarantee that the land is free from private claims. Therefore, putting state claims on those 108 million hectares is inconsistent with the Forestry Law. Third, state forests are not the same as MoF jurisdiction. It should be noted that the legal notion of public land is significantly different with government land. Public land refers to land without registered private rights. People can obtain rights on the public land, provided they ask the government to grant the rights. To support its tasks and function, the government can control the land, but it should have the rights, namely the right to manage (hak pengelolaan) or right to use (hak pakai). If the MoF argues that the state forest is its exclusive jurisdiction, and it refuses to grant any land rights on the forest, it seems that such forests are located on government land not on public land. Yet, there is a question about the legal status of such government land. Indonesian land law clearly states that the government should have the hak pengelolaan or hak pakai and should register the land with the National Land Agency (BPN). The MoF has done neither. Therefore, its claims may be seen to have no legal basis

In addition, this law mandated that forest be regulated by the state taking into account the rights of indigenous people, to the extent that they still exist and it does not conflict with national interest (Masripatin et al., 2010) as stated in Article 28I(c): the cultural identity and traditional rights of adat communities are respected and protected by the State as human rights (Dunlop, 2009). The law recognizes customary law communities as stated in Article 18B (2) of the Constitution: The State recognizes and respects customary law communities along with their traditional rights, however, it limits these rights according to a broad notion of societal development (Dunlop, 2009). In addition, it accommodates the dynamic of community aspirations and participation,

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customary and cultural, and social values in accordance with national norms; also ensures rights to sustainable forest products and compensation if these communities areas become designated as national forest areas (Takacs, 2009, Dunlop, 2009). The law also acknowledges the right of association controlled by a certain adat community over a certain area, which is the living environment of its members, covering the right to utilize the land, forest and water and all their contents according to statutory regulations (Takacs, 2009). Moreover, since the implementation of the Forestry Law, some local governments have recognized adat forests, given legal recognition to adat communities, and also granted community forest licenses to non- indigenous communities (Fey, 2007). For example, Papuas Special Autonomy law acknowledges the adat communities as the members of the Papua natives living in and bound to a certain area and adat with high solidarity among its members, and acknowledges adat law as the verbal regulations or norms prevailing within the adat law community, regulating, binding and maintained and bear sanctions.The Law protects adat rights, and establishes adapt courts, but does not specify when community law will prevail over formal statutory provisions (Takacs, 2009). Even so, until now, Indonesia still has weak local tenure in practice and weak local tenure on paper (based on policy and law) (Cotula & Mayers, 2009). In practice, conflict and disagreement over who should control and manage the countrys forests and forest lands underlie many of the tensions. The origins of this disagreement lie in large part in simplistic interpretations of the definition and location of both Indonesias forests and the jurisdiction of the Department of Forestry (Contreras-Hermosilla & Fay, 2005; Leimona et al., 2009). Existing forest boundaries are perceived as definitive by the Ministry of Foresty, but involved very little community participation during the field mapping while forest bundary mapping initiated by third parties (e.g. local people and NGOs) is rarely recognized by the authorities (Forestry Planning Board of the Ministry of Forestry in this case) (Leimona et al., 2009). Different interpretations lead to radically different levels of control over forest resources by different institutions and actors. Conflicts over control of land and natural resources due to uncertainty of ownership (state or community) will remain unless a serious effort is organized to rationalize the State Forest Zone through a clear action strategy (Contreras-Hermosilla & Fay, 2005).

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4.4

Legal framework in Indonesia

In order to cope with challenge in the forestry sector for the past ten years and to anticipate potential problem in the period of the next five years, the forest sector has set and implemented five prioritized policies since the 2000, namely: 1. Curbing illegal logging and its associated trading 2. Restructuring of the forestry sector through enhancement of timber plantation development and forest industry 3. Land rehabilitation and forest conservation 4. Empowerment of people in/surrounding forest 5. Strengthening forest boundaries to secure forest areas (Masripatin et al., 2010). Starting from the end of 2009, the five prioritized policies have been amended into eight prioritized policies which address the problems encountered and future challenges. The eight prioritized policies are as follows: 1. Strengthening forest boundaries to secure forest areas 2. Rehabilitation of degraded forest and improving carrying capacity of watershed 3. Forest protection and fire management 4. Conservation of biological diversity 5. Revitalization of forest utilization and forest industries 6. Empowerment of indigenous peoples and local communities 7. Mitigation and adaptation to climate change 8. Strengthening forest institutions (Masripatin et al., 2010, Siswanto, 2010). In line with climate change mitigation, law no. 41 of 1999 concerning forestry, law no. 26 of 2007 concerning Area Planning, Government Regulation (PP) no. 6 of 2007 and the amendment in PP no. 3 of 2008, has provided strong legal framework and grounds in mitigating the impact of climate changes by reducing the greenhouse gas emission from deforestation and forest degradation which involves the provision of access and management of forest resources to people around the forest (Masripatin et al., 2010). Moreover, Indonesia has also established the worlds first national laws relating to REDD. These laws are necessary to clarify the law and policy framework needed to attract REDD investment. Currently, there are three Ministry of Forestry (MoFor) regulations and decisions which directly refer to REDD:

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MoFor Regulation 68/2008 which provides an umbrella for voluntary REDD initiatives and demonstration pilot projects (REDD Demonstration Activities) currently under implementation or being developed (11 December 2008) (MoFor, FAO, UNEP, UNDP, 2009); Ministry of Forestry Decree SK. 13/Menhut-II/2009 which establishes a Climate Change Working Group within the Ministry of Forestry (MoFor) (12 January 2009). The Climate Change Working Group aims to develop initiatives to deal with issues related to climate change including REDD. The group comprises all Directorate Generals (DG)s within the Ministry (MoFor, FAO, UNEP, UNDP, 2009; Masripatin et al., 2010). MoF Regulation 30/2009 on Procedures for REDD (1 May 2009). The policy sets out an extensive list of potential participants, from managers of community forests to those who hold timber or ecological restoration concessions. It stipulates the categories of forest land where REDD projects are authorised, sets out various procedures to establish a REDD project, and denes the roles and responsibilities of national and international project proponents. The decree says little about the responsibilities of the Ministry, or cross-sector coordination. It does, however, allow for local government to participate in approving REDD projects, except in decisions concerning officially designated Forest Management Units (KPHs) (Atmadja & Wollenberg, 2010). MoF Decision 36/2009 on Procedures for the Granting of Utilization of Carbon Sequestration or Sinks in Production Forest and Protected Forest (22 May 2009) (Dunlop, 2009) Concerning carbon rights, Government of Indonesias new legislation on forest planning, management and use (Government Regulation PP 6/ 2007) provide a key legal basis which authorises provincial and district governments to issue Permits for the Utilization of Environmental Services, called Izin Usaha Pemanfaatan Jasa Lingkungan (IUPJL) (Rafli et al., 2007). IUPJL is a licence to exploit environmental services including carbon storing and absorbing (Rafli et al., 2007) both in production and protection forest (REDD Monitor, 2008). It entitles holders to store and absorb carbon in both Production and Protection Forests of 1000 ha. maximum size and are granted for a term of 30 years (Dunlop, 2009; Takacs, 2009). While there is no clear statement in the regulations that an IUPJL for carbon storage entitles the holder to all carbon rights, it is generally accepted that an IUPJL carries carbon ownership rights.

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Moreover, while these regulations add some clarity over carbon rights in protection and production forest, outside of these areas the situation is unclear (Dunlop, 2009). Until now, central government has still not reached decisions or agreements with the local governments on how forests in general and forest carbon in particular will be regulated and benefits shared from REDD investments. Although the Special Autonomy Law grants 80% of forestry taxes to the Province, this does not necessarily mean that the same percent of carbon revenues will return to the Province (Takacs, 2009).The province of Aceh finds itself in a similar situation. While the central government has granted Aceh a greater degree of autonomy than any other province, it still is not clear whether or not this means the provincial government has total legal control to enter into and profit from forest carbon projects on government land. (Takacs, 2009).

4.5

REDD in Indonesia
Since at least 2007, Indonesia together with a multitude of partners has invested tremendous efforts in preparing for REDD (Atmadja & Wollenberg, 2010). Indonesia has performed a quick study/ analysis concerning its preparedness, in terms of methodology and policy, and formed Indonesia Forest Climate Alliance (IFCA) in July 2007 (MoFor, 2008) to conduct initial steps in REDD Readiness. IFCA is a forum or umbrella for communication, coordination, and consultation of the stakeholders in discussing the REDD issues, including the progress and output of the REDD study on that year. The IFCA is coordinated by the Ministry of Forestry, consisted of governments, private sectors, civil societies, scientific institutions and international partners (MoFor, 2008). It was funded by the World Bank, United Kingdom, Australia and Germany (MoFor, 2008; Masripatin et al., 2010; Atmadja & Wollenberg, 2010). The IFCA, has conducted a series of important studies on different aspects of REDD organized through working groups, resulting an initial outline of what was called a REDD supply chain (Box 1.). The study outputs were integral parts of the material presented for discussion by the Ministry of Forestry (REDDI Roadmap) when Indonesia hosted the UNFCCC 13th Convention of the Parties (COP 13) in Bali in December 2007. As follow up of Bali Road Map and REDDI (REDD in Indonesia) Road Map, National REDD Strategy has been elaborated (MoFor, 2008).
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In its REDDI Roadmap, Indonesia has communicated the concept of phasedapproach in implementation of REDD in Indonesia which consists of 3 (three) phases: Phase 1 (preparation phase): quick analysis on the preparedness of Indonesia, in terms the Status of Science and Technology and relevant policies (2007 -2008) Phase 2 (readiness phase): preparation of instruments necessary for the implementation of the third phase: establishment of REL/RL, carbon accounting, MRV system, policy, institutional setting, funding and incentive distribution mechanism, capacity building, Demonstration Activities,

participation of the stakeholders including people in/surrounding the forest (2009-2012) Phase 3 (full implementation): full implementation according to the rules and procedures decided by COP when REDD/REDD-plus has become part of the UNFCCC scheme post 2012. (See Figure 6.) (Masripatin et al., 2010; Siswanto, 2010).

Figure 6. Road Map of REDD Indonesia-phased approach (Masripatin et al., 2010) Those phases of activity would require three separate financial resources. Readiness activities would leverage ODA (Official Development Assistance) through bilateral and/or multilateral channels. A transition phase would use both ODA and voluntary based funding mechanisms and transition to a pre-2012 market. A post 2012 agreement would use a market based approach including
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domestic, regional or international emissions markets, accompanied by deeper targets for Annex I Parties (Parker et al., 2009). The design of the Indonesian national REDD payments system will involve decisions over: 1. Financial transfer mechanisms at different scales; 2. Revenue allocation; 3. Forms of payment and timing; 4. Legal and other institutional structures; and 5. Risk management options (MoFor, 2008). Regarding issue who will be the seller, taking into account relevant regulations, there are two options: 1. Transactions would take place with the central government; 2. Transactions would be carried out with lower government levels or directly with projects. Then redistribution of funds can take place in three ways: a. Following the government administration hierarchy: National <> Provincial <> District government <> Village; b. Based on management of forest functions: National <> National forestry authority <> Local forest management units; c. Domestic project-based with the nation as re-seller on the international market: National authority <> Project entities <> local actors (MoFor, 2008). REDDI strategy for Readiness Phase is aimed at providing guidance concerning policy intervention required in the effort to address drivers of deforestation and forest degradation, and the infrastructures which must be prepared in implementing REDD/REDD plus. This strategy also integrates all actions related to REDD/REDD plus including the activity funded from foreign sources. Readiness strategy includes both methodology and policy aspects, and supporting activities such as capacity building and communications with stakeholders, and implementation of Demonstration Activities. The Readiness strategy of REDD Indonesia (REDDI) will also forms a part of the strategy and efforts of Indonesia to achieve Sustainable Management of forest for sustainable development (Masripatin et al., 2010).

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The strategy of REDD Indonesia is implementing at the sub-national level (Province/District/Management Unit) and further will be integrated to the national accounting. The strategy in each level is shown on Table 3. Table 3. REDD plus strategy readiness phase (2009 2012) Level
National National approach

Strategy category

1. Policy intervention to tackle drivers of deforestation and forest degradation in different landscapes of forested areas 2. REDD regulations (REDD guidelines and REDD commission): ministrial regulation on REDD 3. Methodology (establishment of National REL and MRV system): GOI-Australia, FCPF, UNREDD 4. Institutional arrangements (financing, including distribution of incentives and responsibilties, national registry, capacity building, stakeholders communication or coordination among REDD institutions, stakeholders consultation): GOI Australia, FCPF, UNREDD 5. Analytical works (REL,MRV, Co-benefits, risks, etc.): GOI -FCPF Provincial 1. Methodology (establishment of provincial REL and MRV system Sub-national 2. Institutional (capacity building, stakeholders communication and implementation coordination among REDD indtitutions, stakeholder consultation) 3. Demonstration activities, voluntary carbon projects District 1. Methodology (establishment of district REL and MRV system) 2. Institutional (capacity building, stakeholders communication and coordination among REDD institutions, stakeholders consulatation) 3. Demonstration activities (GOI- Germany, GOI- TNC, WWF, ITTO, Korea, UNREDD), voluntary carbon projects. Source: Siswanto (2010); Masripatin et al., 2010

Figure 7. Strategy REDD Indonesia (Masripatin et al., 2010)

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Since 2008, Indonesia has been doing some progresses: 1. The government has created the Indonesia Climate Change Trust Fund (MoFor & TNC, 2009) 2. The government established cross-ministerial National Climate Change Council (Dewan Nasional Perubahan Iklim or DNPI) led by President of the Republic of Indonesia to provide inter-ministerial climate change coordination and to advise and oversee implementation of both climate change adaptation and mitigation policies (MoFor &TNC, 2009; MoFor, FAO, UNEP, UNDP, 2009; Atmadja & Wollenberg, 2010). DNPI has become the UNFCCC focal point. 3. In June 2008, Indonesia and Australia agreed to develop a Roadmap for Access to International Carbon Market (MoFor, FAO, UNEP, UNDP, 2009) 4. The Ministry of Forestry has issued National Regulations on Reducing Emissions from Deforestation and Degradation in order to guide implementation of national REDD policy (Chapter 4.4.) (MoFor, FAO, UNEP, UNDP, 2009; Masripatin et al., 2010). 5. The Ministry of Forestry in cooperation with the Government of Australia has developed Forest Resource Information System (FRIS) and Indonesia National carbon Accounting System (INCAS). 6. The Ministry of Forestry developed other programs to support REDD indirectly, particularly to carbon measurement through various projects. For examples, collaboration between the MoFor (PHKA, RLPS, FORDA) and ICRAF under a Rewarding the Upland Poor for Environmental Services (RUPES) project, REDD ALERT project, and other activities under FMU system development and Timber Legality Assurance System (TLAS). 7. In March 2009, Indonesia was admitted to the second tranche of countries to participate in the Forest and Carbon Partnership Facility (FCPF) (Atmadja & Wollenberg, 2010). 8. In March 2009, Indonesia was amongst the ve nations granted US $18 million in UN pilot funding for REDD capacity building (Atmadja & Wollenberg, 2010). 9. Development of Demonstration Activities (DA) as learning by doing facility and means of building commitment and synergy of stakeholders. As of March 2010, there are 9 demonstration activities on going in Indonesia as shown in Table 4.
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Table 4. REDD Demonstration Activities in Indonesia Project Province Institutions Involved

Merang REDD Pilot Project (MRPP) Sumatra Forest Carbon Partnership Meru Betiri National Park KOICA REDD Project in Lombok Kalimantan Forest and Climate Partnership Musi Banyuasin, South Sumatra Jambi, South Sumatra East Java Lombok Central Kalimantan GTZ Australian government ITTO/Forestry Research and Development Agency KOICA Australian Government partnering with GoI. Implementation partners are CARE, BOS, Wetlands International TNC/ICRAF/Sekala/University Mulawarman/Winrock Intl/ University of Queensland

German DC Agencies (DED)/CIM/Inwent Implementation WWF and Eco Consult Malinau Avoided Malinau, East GER/PT. Inhutani II/Malinau Deforestation Project Kalimantan Regency/KfW/FFI/District Government/GTZ/Tropenbos International/Global Eco Rescue/Borneo Tropical Rainforest Foundation UNREDD Carbon Central Sulawesi FAO, UNDP, UNEP, and Project Ministry of Forestry Source: MoFor, FAO, UNEP, UNDP (2009); Lin (2010), Sarsito (2010)

Berau Indonesia Climate Action Project; Berau Forest Carbon Program REDD Projects by FORCLIME in Kapuas Hulu

East Kalimantan

Kapuas Hulu, Kalimantan

Figure 8. Demonstration activities in Indonesia (Sarsito, 2010)

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Concern on REDD implementation has been given also by some private sectors and NGOs in a form of developing voluntary based REDD demo activities. There are several voluntary pilot REDD initiatives in Indonesia that are in the early stages of design and implementation as shown in Table 5. Table 5. Voluntary and local government initiatives Project
The Rimba Raya Biodiversity Reserve Project Katingan Conservation Area: A Global Peatland Capstone Project Lamandau REDD in Sebangau National Park West Kalimantan Community Carbon Pool Conservation of the Upper Kapuas Lakes System Rehabilitation of the Sungai Puri peat swamp forest Kutai Barat, HKM: Heart of Borneo Global Green in East Kalimantan Hutan Lestari untuk Orangutan Jayapura Pilot Project Global Green Ecosystem Restoration Project Berbak Carbon Value Initiative Harapan Rainforest Project

Province
Central Kalimantan

Institutions Involved
Infinite Earth/Oramgutan Foundation International Starling Resources

Central Kalimantan

Central Kalimantan Central Kalimantan West Kalimantan West Kalimantan

RARE/YAYORIN/Clinton Foundation WWF/Sebangau National Park FFI/David and Lucile Packard Foundation FFI/Macquarie Bank

Ketapang, West Kalimantan East Kalimantan East Kalimantan East Kalimantan

FFI/Macquarie Bank

WWF Global Green PT.RHOI (Restorasi Habitat Orangutan Indonesia) formed by BOS WWF Global Green

Papua West Sumatra

Jambi, South Sumatra Jambi, South Sumatra

Kampar Ring- A sustainable development model based on responsible peatland management Tesso Nilo Pilot ProjectREDD Reducing Carbon Emissions from Deforestation in the Ulu Masen Ecosystem A

Riau

ZCL/DEFRA/LIPI/Berbak National Park/US Fish and Wildlife Service Burung Indonesia/The Royal Society for the Protection of Birds/Birdlife International/PT.REKI/ Yayasan KEHI APRIL

Riau Aceh

WWF Aceh provincial government, Carbon Conservation, FFI

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Triple Benefit Project Leuser Ecosystem REDD Project Gorontalo Establishment and Management of Nantu national Park Sustainable Management of Poigar Forest: REDD in North Sulawesi Perpetual Finance for Carbon Benefits Mamuju Habitat TEBE Project (Towards Enabling Mitigation of Climate Change Through Promotion of Community Based Economic Growth

Aceh Gorontalo

North Sulawesi

Global Eco Rescue/ Government of Aceh Gorontalo University/YANIYayasan Adudu Nantu International ONF International/ Green Synergies

Papua

West Sulawesi East Nusa Tenggara

New Forests Asset Management/ PT.Emerald Planet PT Inhutani I KYEEMA Foundation/AusAid/Yayasan Peduli Sanlima/Yayasan Timor Membangun (YTM)

Source : Griffiths & Martone (2009); Lin (2010)

Figure 9. REDD voluntary activities in Indonesia (Sarsito, 2010)

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5.
5.1
5.1.1

Results and Discussions

Descriptive analysis of chosen case studies
REDD in the Ulu Masen Ecosystem, Aceh (voluntary activity, landscape level) This brief description of REDD in the Ulu Masen Ecosystem, Aceh is based on papers prepared by: Rafli, T.P.; Usher, G.; and Niles, J.O. in 2007 entitled Reducing carbon emissions from deforestation in the Ulu Masen Ecosystem, Aceh, Indonesia: A triple benefit project design note for the CCBA audit. SmartWood in 2008 entitled Validation audit report for Provincial Government of Nangroe Aceh Darussalam- Fauna & Flora InternationalCarbon Conservation in Ulu Masen Ecosystem (Aceh Province, Indonesia). Atmadja, S. and Wollenberg, E. in 2010 entitled Indonesia. The Ulu Masen project is proposed to reduce emissions from deforestation and forest degradation, whilst maintaining significant biodiversity values and enhancing community development opportunities through reinvestment of the proceeds from carbon sales and small scale extraction and development of community managed enterprises within forests approved for such purposes (SmartWood, 2008). By using land use planning and reclassification, increased monitoring and law enforcement, reforestation, restoration, and sustainable community logging (Rafli et al., 2007), the project is expected to off-set 3,369 million tonne/year or about 100 million tonne of CO 2 emissions over the next 30 years. The Ulu Masen Ecosystem was the rst REDD pilot project in Indonesia to take a voluntary market approach. It is also the rst REDD project in a developing country to meet Climate, Community and Biodiversity (CCB) standards, and acquired certication in February 2008. The projects activities are predicted to reduce deforestation of the Ulu Masen forest by 85% (Atmadja & Wollenberg, 2010). The project area focuses on 750,000 ha of forest in the Ulu Masen Ecosystem and peripheral forest blocks located in five northernmost districts or kabupaten of Aceh Province, namely Aceh Besar, Aceh Jaya, Aceh Barat, Pidie, and Pidia Jaya. The project area is situated between 4203 N and 5300 N between 95200 E and 96300 E (Rafli et al., 2007). The forest areas within the project
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include: 428,757 hectares of unprotected state forest lands which were allocated to natural forest concessions (HPH) for industrial scale logging, but are currently not active or operational; state forest lands allocated to commercial and community conversion logging licenses (HTI or HPK); and 310,991 state forest lands that are zoned in various classes of protected status, yet for which actual protection is weak and ineffective (SmartWood, 2008).

Figure 10. Map of project area of Ulu Masen Ecosystem (Rafli et al., 2007). The Ulu Masen Ecosystem Project, Aceh, has been developed by three parties working together, which are the Government of Aceh, Fauna and Flora International (FFI) and Carbon Conservation Pty Ltd (SmartWood, 2008; Atmadja & Wollenberg, 2010). FFI will facilitate participatory processes for community development, spatial and land use planning, biodiversity

conservation, collaborative law enforcement and community-based forest management. Carbon Conservation Ltd. Pty is assisting with project design, development, start-up and carbon finance (Rafli et al., 2007). Project activities are to (Rafli et al., 2007, Atmadja & Wollenberg, 2010): Strengthen land tenure and resource access of forest-dependent communities and those with customary rights;

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Strengthen forest management, forest governance and forest law enforcement processes at provincial, district and Mukim5 (subdistrict) levels; Establish legal and regulatory frameworks for trade in carbon rights and carbon credits; Develop land use plans at the provincial, district and Mukim levels, including rezoning conversion forest to protection forest or limited production forest as appropriate, and identifying land for community forest management, reforestation and community agroforestry; Develop and test mechanisms to ensure equitable and transparent distribution of benets from carbon trading through consultation with stakeholders; Support the development of community forestry, agroforestry and other livelihood initiatives; Develop capacity for carbon accounting and monitoring; Determine, based on historical trends in comparable areas, baseline rates of deforestation and forest degradation. The 30 years project accounting period will also be divided into two stages, a pre-REDD credit stage (from 2008 to 2012) where fungible early-action REDD credits may or may not be available, and a second stage after 2012. The first stage will build on and extend foundations established by FFI and its partners under the World Bank Multi-Donor Funds Aceh Environment and Forest Project (AFEP). In addition to project design and implementation, this 2008-2012 stage will focus on procuring finance from bilateral and multilateral funds, philanthropic sources, and voluntary credits. This stage will include four overlapping phases: Phase 1: Information gathering, technology and skills transfer and development of project proposal and structures, institutional framework, and financing (6 months, July 2007 to December 2007). Phase 2: Develop benefit sharing mechanisms, implement planning processes, implement legislative and regulatory changes, set up a system for forest and carbon stock monitoring, preparation for community forestry, reforestation and agro-forestry projects, re-evaluate and improve

Mukim: An administrative/ governance structure that was originally part of Aceh sultanate system. A mukim traditionally covers all villages that are linked to the main mosque in the area. It is loosely equivalent to the kelurahan or kecamatan elsewhere in Indonesia. It is mostly found in areas around the Ulu Masen Ecosystem (Dunlop, 2009)

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baseline rates of deforestation for the project area, move toward IPCC Tier 2 carbon stock measures, and synthesize understanding of current biodiversity and livelihoods, enhanced efforts to control illegal logging in combination with forest monitoring and assessment (18 months, January 2009 to July 2009). Phase 3: Ongoing forest and carbon monitoring including movement toward IPCC Tier 3 understanding of forest carbon stocks, promotion of sustainable community forest management, forest product value adding, reforestation and community agro-forestry, monitoring virtual carbon funding (ODA funds) disbursed through incentive mechanism, financed through the sale of voluntary Verified Emission Reductions (VERs) or early-action credits. (three years, January 2009 to December 2011). Phase 4: Continuing implementation of project activities and transfer to 2nd commitment period REDD credits or appropriate outcome of UNFCCC negotiations. (2012). the expectation is that after 2012, the project will be included in Indonesias baseline (reference emission scenario) and fungible post-Kyoto/UNFCCC carbon credits will be available (Rafli et al., 2007). Project development, design and initial implementation will be initially funded from Official Development Aid (ODA) funds. The project will also get support from AFEP (Rafli et al., 2007; SmartWood, 2008). After the initial phase of the project, carbon finance from sale of Verified Emission Reductions (VERs) must be secured to provide immediate and substantial incentive payments to all relevant stakeholders who help arrest deforestation and increase forest protection in the project area including forest dependent communities and those with customary (adat) rights to forest land (Rafli et al., 2007).

5.1.2

REDD in Meru Betiri National Park, East Java (demonstration activity, site level) This brief description of REDD in Meru Betiri National Park, East Java is based on papers prepared by: FORDA and ITTO in 2010 (a) entitled Leaflet of Tropical Forest Conservation for Reducing Emissions from Deforestation and Forest Degradation and Enhancing Carbon Stocks in Meru Betiri National Park,

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Indonesia : A public private partnership ITTO Program PD 519/08 Rev.1 (F) FORDA and ITTO in 2010 (b) entitled Public private partnership for measuring and monitoring carbon and biodiversity FORDA and ITTO in 2010 (d) entitled Stakeholders consultation to identify most viable scheme for conservation carbon-biodiversity and livelihood. ITTO in 2009 entitled News release: Partnership to conserve tropical forests launched ITTO, 7&i Holdings to work with Indonesia for enhanced forest carbon stocks, biodiversity conservation Ma, H.O. in 2009 entitled ITTO thematic programme on Reducing Deforestation and Forest Degradation and Enhancing of Environmental Services (REDDES). Ma, H. O. In 2010 entitled ITTO support to REDD demonstration activities in Indonesia.

On 9 October 2009, a REDD conservation project in Meru Betiri National Park (MBNP) was launched at the Indonesian Embassy in Tokyo. The Meru Betiri NP is located in the southern part of East Java, Indonesia surrounded by two heavily populated districts of Jember and Banyuwangi. The park area consists of approximately 58,000 ha which is rich in biological diversity across several landscapes with different vegetation types. However, this park has faced serious threat such as illegal harvest, encroachment, forest fire, and land slide (FORDA & ITTO, 2010 d). The illegal harvest of timber and non-timber forest product from the Park is mostly due to poor law enforcement and lack of sustainable income sources. This situation, directly or indirectly, contributes to rapid degradation and deforestation in the park (ITTO, 2009).

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Figure 11. Location of Meru Betiri National Park (FORDA & ITTO, 2010 a) This Public-Private Partnership project will run within 3 years from January 2010 until January 2013. Budget for the project is US$ 973,388 with contribution from ITTO US$ 814,590 and from Government of Indonesia US$ 158,798. Forest Research and Development Agency (FORDA) and Ministry of Forestry (MoFor) will be the executing agencies (Ma, 2010) in collaboration with LATIN (a NGO) and 7&i Holdings (7 Eleven, Japan) (Ma, 2009). As part of newly established ITTO Thematic Programme on Reducing Deforestation and Forest Degradation and Enhancing Environmental Services in Tropical Forests (REDDES), this project is designed to contribute to conservation of tropical forests for reducing emissions from deforestation and forest degradation and enhancing forest carbon stocks through enhanced community participation in conservation and sustainable management of the MBNP as an integral part of the larger landscape in which the communities live (ITTO, 2009). To this end, the project specifically intends to improve the livelihoods of local communities living inside and in the surrounding area of MBNP through participation in avoiding deforestation, degradation and biodiversity loss; and to develop a credible measurable, reportable and verifiable system for monitoring emission reductions from deforestation and forest degradation and enhancing forest carbon stocks in MBNP (Ma, 2009). The expected outputs of the program consist of (FORDA & ITTO, 2010 a): Participation of community in conservation forest management improved;
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Alternatives sources of income to improve the livelihoods of local; communities living inside and in surrounding area of MBNP developed; Illegal logging and forest encroachment reduced and reported; Capacity in resource base inventory and carbon accounting improved in measurable, reportable and verifiable form; Report on comprehensive baseline data and estimation of emissions reduction and carbon enhancement of the national park prepared; System of monitoring emission reduction and enhancement of carbon stocks established and validated Main project activities are: 1. Review existing schemes and lessons learned from the surrounding areas; 2. Stakeholder consultation and partnership in conservation through various forms and methods including in person discussion, Focus Group Discussion (FGD) and multi-stakeholders workshop. The consultation process is conducted to five groups, as follows: local government officials, local community nearby and inside the park, management officials of MBNP, local NGOs, academicians, teachers, and religion leaders;

Figure 12. Framework for stakeholder consultation (FORDA & ITTO, 2010 d) 3. Scale up lessons learned and disseminate good practice gained; 4. Conduct awareness raising training and institutional building for REDD and REDD plus; 5. Develop standard operational procedures for measuring and monitoring; 6. Conduct training and institutional building for resources base inventory for related stakeholders; 7. Determine project boundary and baseline by establishing representative Permanent Sample Plots (PSPs);

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8. Estimate emissions reduction and enhancement of carbon stock; 9. Conduct validation to assess the applied methodologies by a selected standard (FORDA & ITTO, 2010 a). FORDA & ITTO (2010 b) states those main activities will be conducted in 3 stage plan: 1. Phase 1 (2010 -2011) Establish a comprehensive framework for stakeholders engagement Establish of PSP and data collection for carbon accounting 2. Transitional (2011 2012) Consolidate phase 1 Develop activities for phase 2 (applied methods for carbon accounting) 3. Phase 2 (2012 -2013) Develop comprehensive capacity (communities, public, and private) Develop comprehensive capability (all pools and applied tool) Dissemination
Box 9. REDDES (Reducing Deforestation and Forest Degradation and Enhanching Environmental Services in Tropical Forests) (Ma, 2009) General objective: to reduce deforestation and forest degradation, enhance environmental services and help improve forest dependant livelihoods through sustainable management of tropical forests, forest restoration and other related activities. Specific objective: to strengthen the capacity of ITTO developing member countries and their stakeholders to: (1) reduce unplanned deforestation, (2) reduce forest degradation, (3) maintain and enhance climate change mitigation and other environmental services of tropical forests, and (4) contribute to the social and economic sustainability of forest dependent communities by increasing forest values through forest restoration and rehabilitation as well as payments for forest-based environmental services. Expected outcomes of this programme: Reduced deforestation and forest degradation and increased area of forest under sustainable management in tropical timber producing forest Improved livelihoods for forest dwellers and other stakeholders directly involved in the supply of environmental services through the sustainable management of tropical forests Improved resilience of tropical forest ecosystems and forest dependent communities Improved capacities to develop and implement policies and incentives mechanisms to promote environmental services through sustainable forest management Improved practices to promote community involvement in the supply of environmental services from SFM

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5.1.3

Berau Carbon Forest Program, Kalimantan (demonstration activity, landscape level) This brief description of Berau Carbon Forest Program is based on a paper prepared by MoFor RI and TNC in 2009 entitled Berau Forest Carbon Program: Delivering practical solutions to support development of a national level REDD framework in Indonesia. The Berau Forest Carbon Program (BFCP) is a partnership between national, provincial and district governments, civil society, and the private sector (REDD Working Group) which aims to enable Berau district, province of East Kalimantan to meet its development goals while sustainably managing its forests by developing a carbon finance mechanism that delivers effective incentives to reduce emissions from forest loss. The vision is an integrated district-scale forest carbon program that, by 2015, with funding of $ 50 million, brings at least 800,000 hectares under effective management, avoids emissions of 10 million tons of carbon dioxide over five years, protects critical watersheds and areas of high biodiversity value (including habitat of 1,500 orangutans), and creates improved economic outcomes and opportunities for communities living near forests.

Figure 13. Location of Berau District (MoFor & TNC, 2009) There are several activities in realizing this vision: 1. capacity and institution building to support sustainable land use planning: supporting improved spatial and natural resources planning and decisionmaking, including mechanisms for data coordination by different levels of government 2. emission reduction programs, comprising of the following activities:
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a. producing a baseline of estimated historic and anticipated emissions under business-as-usual activity. b. measuring avoided emissions from multiple strategies in different sites under a unified carbon accounting framework c. working closely with the Ministry of Forestry and international experts to develop an integrated methodology for REDD+ carbon monitoring and accounting that nests within national and international accounting systems and is verified with leading standards. d. bundling of carbon rights from individual project-scale emissionreduction strategies or land use categories to achieve transactional efficiency e. developing a Reference Emission Level (REL) that effectively incorporates planned and unplanned deforestation and degradation, f. improving forest management within timber concessions

g. developing incentives for improved management of protection forests h. implementing a comprehensive set of mutually-reinforcing strategies for sustainable land use management that aligns with economic development aspirations i. developing legal mechanisms for conservation-based payments to land users that forego legal economic opportunities e.g. paying for environmental services from High Conservation Value Forests and other special management areas within concessions areas planned for non- forest uses 3. community involvement into overall program decision making, site-based incentive agreements, and more broadly directed towards low-carbon development strategies: a. Establishing governance structures and consultative mechanisms to include communities in overall program decisions b. Strengthening community institutions to facilitate effective participation c. Investing in alternative livelihoods programs in target areas to support low-carbon development strategies d. Developing mechanisms to share revenue from carbon credits equitably with all relevant stakeholders including creating diverse forms of benefit sharing that are not tied to land ownership in order to resolve key types of land conflicts.

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Figure 14. Phases of development of Berau Carbon Forest Program (MoFor & TNC, 2009) The Berau Forest Carbon Program has some unique features, different from the other projects: It is a district-scale program based on the development of a district-wide carbon accounting framework that captures emissions from a range of strategies and land types, which will dramatically reduce concerns about leakage (shifting activities to other locations). It is based on more integrated model that deals with the key underlying deforestation drivers, including policy, planning and governance issues, and aligns these efforts with economic development aspirations. An inclusive partnership approach between all stakeholder groups. The Berau program will engage communities and people living in and near forest areas; private sector investors and employees; government officials and agencies at all levels; and a range of civil society organizations through a variety of activities and governance mechanisms. It will involve also scientific, academic, and charitable institutions. As regards to the involvement of government entities, many institutions are lending technical, socioeconomic, and other critical knowledge to the program, including: ICRAF (The World Agroforestry Center), Sekala, the World Resources Institute, Universitas Mulawarman, Winrock International, The University of Queensland, World Education. It is based on a No regret strategy for all participants. With regard to conservation strategies: while widespread support exists for including financial incentives for forest conservation and management in emerging climate policy frameworks, many uncertainties exist about the exact form,
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scale, and timing of future forest carbon funding, especially from potential market mechanisms. Therefore, the Berau Forest Carbon Program is focused on aligning its efforts with existing goals and programs that are consistent with long-term sustainable development e.g., Reduced Impact Logging and maximizing use of degraded lands which are currently used for oil palm to achieve multiple environmental and economic benefits. With regard to funding sources: given uncertainties about future forest carbon markets, the program is focused on attracting financial support for program design and institutional development that are critical foundations for any form of carbon finance. In this program, The Nature Conservancy (TNC) has played a significant role as project developer and consultant in the program design and development, but plans to play a smaller role in implementation and does not seek to own carbon rights from the program in order to maximise the role of local stakeholders. 5.1.4 UNREDD Carbon Project in Central Sulawesi (demonstration activity, landscape level) This brief description of UNREDD carbon project in Central Sulawesi is based on a report prepared by in MoFor, UNEP, FAO, UNDP in 2009 entitled Indonesia UNREDD National Joint Programme. On 24 September 2008, the global United Nations Collaborative Programme on Reducing Emissions from Deforestation and Forest Degradation in Developing Countries (UN-REDD Programme) was launched aiming to assist tropical forest countries in establishing a fair, equitable and transparent REDD regime. Indonesia is one of the nine pilot countries for the initial phase. This 20 months programme (October 2009 May 2011) will be supported about 5.6 million USD by Government of Norway as part of Norways International Climate and Forest Initiative which was announced during the UNFCCC conference at Bali in 2007. The demonstration province of this programme is central Sulawesi which fulfils the following criteria: 1. Deforestation process is ongoing but a significant forest cover has remained. 2. Carbon density is relatively high 3. Local political support is strong 4. Local capacity is reasonably strong, in order to generate rapid results

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5. Drivers can be addressed relatively easily 6. REDD can result in significant co benefits within the project site. 7. GOI preference and location of other initiatives (based on agreements reached in IFCA on criteria for demonstration site selections, GOI policy on REDD demonstrations and UN-REDD objectives)

Figure 15. Location of Central Sulawesi (http://www.indonesiamatters.com/images/sulawesi-map.png) In order to secure the objective, three outcomes with respective outputs and activities will be pursued. The outcomes are intended to strengthen stakeholders at national level (outcome 1), provincial level (outcome 2) and district level (outcome 3). The outcomes are designed to strengthen stakeholders at both vertical and horizontal levels, from national to grass root levels and vice versa. It is designed also to provide linkages between national, provincial and district level for technical implementation of REDD. 1. Outcome 1: Strengthened multi-stakeholder participation and consensus at national level This outcome is particularly focused on reaching consensus on key issues related to REDD at the national level, particularly among stakeholders from central and local government, but also ensuring participation of civil society organizations. It will create a common understanding among the stakeholders. The intended Outputs are as follows:

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a. Output 1.1 (UNDP): Consensus on key issues for national REDD policy development b. Output 1.2 (UNDP): REDD lessons learned c. Output 1.3 (UNEP): Communications Programme 2. Outcome 2: Demonstration of establishing a REL, MRV and fair payment systems based on the national REDD architecture This Outcome will include analytical work and institutional capacity building on a number of key elements for REDD implementation in Indonesia. The objectives of this outcome are to support Indonesia in being ready to report emission reduction to UNFCCC, to support Indonesia in developing a REDD national implementation system, and to strengthen systems that have already been developed by GoI such as NCAS and FRIS to achieve a standardized system. a. Output 2.1 (FAO) Improved capacity and methodology design for forest carbon inventory within a Measurement, Assessment, Reporting and Verification System (MRV), including sub-national pilot implementation b. Output 2.2 (FAO) Reference emissions level (REL) c. Output 2.3 (UNDP) Harmonized fair and equitable payment mechanism at provincial level d. Output 2.4 (UNEP): Toolkit for priority setting towards maximizing potential Carbon-benefits and incorporating co-benefits, such as biodiversity conservation and poverty alleviation under MDG 3. Outcome 3: Capacity established to implement REDD at decentralized levels The project will develop capacity at the local government level through demonstrating the legal process of spatial planning in a number of districts in the demonstration province. Key partners will be the district government stakeholders such as the DPRD, forestry services, agriculture and rural advisory services. a. Output 3.1 (UNDP) Capacity for spatial socio-economic planning incorporating REDD at the district level b. Output 3.2 (UNDP) Empowered local stakeholders able to benefit from REDD c. Output 3.3 (UNDP) Multi-stakeholder-endorsed District plans for REDD implementation

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The Lead Implementing Partner of this Programme will be the Ministry of Forestry. A National Project Director (NPD) will be appointed by the GoI to direct the programme and carry overall accountability on behalf of the GoI for the programme to report to the Project Executive Board (PEB). The programme will be managed in accordance with the 2003 UNDG Guidance Note on Joint Programming and executed by several National Implementing Partners, including the Ministry of Forestry, Provincial and District agencies, through the participating UN Agencies, i.e. UNEP, FAO, and UNDP. Each of those Implementing Partners is accountable to the Lead Implementing Partner relating to the funds released for the delivery of a specific set of outputs and for management of inputs.

Figure 16. UNREDD NJP Programme Structure 5.1.5 REDD Project by WWF in Jayapura Regency, Papua (voluntary activity, landscape level) This brief description of REDD project in Jayapura is based on a report prepared by WWF Indonesia in 2009 entitled REDD Project Proposal in Jayapura Regency: Baseline Information. On July 3, 2009, the head of Jayapura Regency and representative from WWF Indonesia signed a Memorandum of Understanding (MOU) for a ten-year commitment to develop REDD mechanism in Jayapura Regency. The total area of proposed REDD project in Jayapura Regency is approximately 465,308.24
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hectares or about 0.03 percent of the total land area of this regency. This proposed project boundaries falls within five districts : Unurum Guay, Nimbokrang, Nimboran, Kemtuk Gressi, and Kaureh. At least six villages with a total population of 2,112 people live within and around the proposed REDD project area: Orya (majority), Elseng, Kaure, Sause, Gresi, and Nimboran.

Figure 17. Map of Jayapura Regency (http://hepuru.files.wordpress.com/2010/07/map-wp3.jpg) 97.5 percent of this area is still covered by primary and secondary forests. The Ministry of Forestry designated the area as State Forest Land and about 68.90 percent of this forest area was allocated for production function. In general, forest cover is still in good condition. However, in the near future, greater deforestation might happen because the Papua provincial government has proposed development plans for 2006 2026 that aim to convert a significant percentage of the forest area within the REDD proposed boundaries to largescale plantation (particularly oil palm), industrial livestock, and other development projects. Therefore, focus activities of REDD project by WWF are: 1. Prevent forest from conversion to oil palm plantation and logging concessions while mitigate carbon. 2. Improve and enhance natural resources governance in order to make sure that government policies in regard to planning, permit processes, monitoring, and enforcement of forest use are not in conflict with their promise to reduce carbon emissions from the forestry sector.

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3. Contribute to policy approaches (community based forest production) and to benefit distribution mechanisms

4. Engage with local stakeholders and enhance community capacity in

development planning and implementation in both institutions: village level government and adat system. In implementing those activities, WWF will work together with local communities, Jayapura University, Gadjah Mada University, Manokwari Research Institute and WWF Netherland (Zulfira Warta, 2010).

5.2

Readiness of Indonesian institutional framework to implement REDD

Indonesias readiness in implementing REDD is assessed by using three concepts. First is concept of better implementation of REDD+ in national level by Steck (2009). This concept is used to assess the readiness with regard of issues on regulatory framework, supporting instruments and infrastructures, and policies including property rights. As part of assessing the first concept, on issue of property rights, the second concept of community tenure security by White (2004) is applied. In this concept, two case studies from Indonesia (Aceh and Papua) are assessed by giving different scores based on some evidences regarding with the five elements of community tenure security. These two case studies are also compared with a case of Aborigin community in Australia. In term of assessing newly defined rights such as carbon or carbon sequestration rights, the third concept of carbon right in Australia is used as model. The first concept is explained now. Streck (2009) states that several requirements should be fulfilled in order to achieve a better implementation of REDD+ at a national level. These requirements include improving regulatory framework, providing other necessary instruments and infrastructures and formalizing policies regarding property rights that will be affected by REDD+, namely: 1) forest tenure and rights to the existing forest , timber, and land resources; 2) newly defined rights, such as carbon or carbon sequestration rights and rights to exploit the benefits of GHG emission reductions and removals in general, and 3) associated rights to international payments for REDD+.

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The analysis starts from considering improvement of regulatory framework. Since 2008, Indonesia is enhancing its readiness in implementing REDD+. With support of existing legal framework in mitigating climate change, it has taken early effort in establishing legal framework for REDD. Although considered the first legal framework developed on REDD in Indonesia, the regulations are more focused on technical issues - like establishment of REDD Demonstration Activities, procedures on REDD and procedures for the granting of utilization of carbon sequestration in production and protection forest (see Chapter 4.4)- than on legal aspects. It is deemed that they failed either in acknowledging rights of indigenous people to land and forest area that will be proposed for REDD or in creating requirements that will be easily fulfilled by community: Ministry of Forestry lists adat forest as eligible for carrying out REDD but, it requires the community to be adat forest license holders. To get this, they must have official documents stating they have adat forest management rights and a recommendation from the regional government; the location must fulfill the right criteria for REDD and they must draw up a REDD implementation plan (prepared both in English and in Indonesian) (REDD Monitor, 2008). As a matter of fact, all these conditions are very difficult to be met by local population. In addition, these REDD regulations are in contradiction with new local law which has moved strongly towards the recognition of customary forest resource rights. For instance, in the Papuan context, government and civil society organizations critized these regulations for their failure to acknowledge and accommodate the special autonomy status of Papua province (WWF, 2009). In terms of providing other necessary instruments and infrastructures, Indonesia has been actively developing strategies, methodology, policies as well as establishing special national institutional to conduct initial steps in REDD readiness e.g. IFCA as forum discussion on REDD issue and National Council for Climate Change (NCCC) as focal point for UNFCCC. In addition, it has actively participating in developing some demonstration activities, which are already mentioned in Chapter 4.5. But their performance and effectiveness, in relation of their authority, coordinating roles and addressing issue of property rights security, are untested (Murdiyarso, 2009). Regards of property right issue, point 1) forest tenure and rights to the existing forest , timber, and land resources is analyzed now. Policies on forest tenure

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and rights in Indonesia are developing towards recognition of customary rights of indigenous people who live in and surround forest area. Statutory law, which previously denied all customary rights in forestry, has opened some opportunities for legal integration (Marfo et al., 2010). Initially, the state merely recognizes customary lands and local norms but because of conflicting pressures, the state is starting taking into account agents who then represent the customary groups. The agent is normally the group leader or head of village. Then, since establishment of Law No. 41/ 1999 on Forestry, existence of customary communities was recognized. Although it is so, the Law leaves ultimate power to the state. In the end, no communities have yet managed to obtain formal recognition of their customary forests (Van Noordwijk et al., 2008 cited in Marfo et al., 2010). This fact is confirmed also by the results of the analysis of community tenure security in two REDD project sites, Aceh and Papua. Result of analysis shows that communities in both Aceh and Papua have unsecure community tenure. Although, both of them have strong and effective internal situation including strong capacity to define and implement its own rules, effective mechanism in handling internal disputes, and a leader in decision making; it is not fully supported and recognized by state law. As described in Chapter 4.3, Forestry Law No.41/1999 takes into account the rights of indigenous people but in reality the ultimate power is still in states hand. Regulations and regulatory mechanisms and institutions in securing customary rights are either still unclear or less supportive. Majority landowners in communities do not have neither land title certificates from National Land Agency (BPN) nor clear customary land boundaries. For instance in case of Ulu Masen ecosystem, most land owners do have local land documentation such as Surat Keterangan Hak Milik (Letter of Evidence of Ownership Right) signed by the Keucik or Camat (sub-district head) but it is not recognized by state. Moreover, there is no legal, policy, and administrative assistance either in securing customary land. Local communities as well still have low

understanding of law even the ability to lobby and effectively defend their rights.

Even so, there is positive trend that can be seen from both cases. Local government have initiated in establishing province level regulations on customary rights and taking into account community participation in decision

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making. It has been supported by some NGOs and CSOs who have initiated participatory land use planning process in some areas in the provinces.

An attempt to provide a quantitative assessment of these issues in presented in Table 6., based on White (2004)s five elements of community tenure security (the second concept, see 2.4). A one to five scale has been worked out in order to assign each project. A value judgement (the detail of the assessment) is reported in Appendix 3. Results have been benchmarked towards a third case, that of Aborigin community in Australia and are plotted in Figure 18. Table 6. Result analysis of community tenure security in 2 REDD projects in Indonesia and in case of Aborigin community, Australia
No. Element of community tenure security (White, 2004) Case 1 (REDD project in Ulu Masen Ecosystem, Aceh) Case 2 (REDD project in Jayapura Regency, Papua) Case 3 (Aborigin community in Australia)

1. 2. 3.

4.

5.

Effective internal institution score Legal recognition and support score Regulations, regulatory mechanisms and institutions score Independent arbitration or judiciary means score Political constituency for community rights score

5 2 x 2 4 x 1

4 2 3 4 x 1

5 4 5 5 5

Note:

x
Statement Fulfill all criteria

clear unclear no
Fulfill almost all criteria 4 Fulfill criteria partly Fulfill few of criteria Fulfill no criteria at all 1

Score

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Figure 18. Community tenure security in 2 REDD project sites in Indonesia and in Australia Situation in the both cases is significantly different with the case of Aborigin community in Australia. Aborigin not only has strong and effective internal institution but the rights of this community is supported and recognized by state law. The community also has a council which gives assistance in establishing legal forms to hold native titles. The second point of Streck (2009), newly defined rights will be considered now. In order to maximize benefits from REDD mechanism, Indonesia has provided a key legal basis which authorizes provincial and district governments to issue Permits for the Utilization of Environmental Services (Izin Usaha Pemanfaatan Jasa Lingkungan -IUPJL), a license to exploit environmental services including carbon sequestration in both production and protection forest which has been described briefly in Chapter 4.4. Based on the regulation, carbon is counted as part of natural resources that is controlled by the state. The state thus has authority to create policy, aimed at administering, managing, regulating, and supervising the following sectors (Alexander, 2010): 1. forest management system to enhance Carbon sequestration stock 2. the appropriation, utilization, reservation and conservation of carbon 3. relations between persons and carbon 4. relation between persons and legal acts concerning carbon. After confronting this fact the classification of possible ownership regimes for carbon sequestration presented in Table 1., it can be concluded that the
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ownership regime in Indonesia is an hybrid of different solutions, to which the closest is the contract type or lease type as implemented in Queensland, Australia (see Table 2.). However, the Indonesian situation is regards to C rights is still immature and deserves further definition. In developing its future strategies it is important that Indonesia takes into account the results by Madeira (2009) who has identified the following three alternatives to establish long term carbon rights in REDD projects: concession model: acquire forest concession rights for the REDD project government partnership interventions (government is the statutory landowner): enter into agreement with the landowner with the existing right to carbon to develop a carbon project and share the carbon credits produced by the project. Land user partnership: enter into an agreement with the land users with the existing carbon rights to develop a carbon project and share the carbon credits produced by the project. The exam of potential and practical (i.e. Australian) solutions to ownership regimes in relation to Carbon has highlighted that the need to establish, as much as possible and in compliance with the existing legal and institutional framework, a C right separate from land ownership. It is anticipated that, in Indonesia, this aspect is particularly delicate being almost all forest area owned or controlled by the State, but with a very complex stratification of official and customary and tenure titles and right distribution (see Chapter 4.). Concerning payment mechanism from REDD, the third point mentioned by Streck, until now central government has not either provided supporting regulation or reached decisions or agreements with local government how benefits shared from REDD investments should be shared (see, on this, Chapter 4.4). The concern to take into account communitys rights in benefit sharing mechanism is still a long way to go.

5.3

An assessment of project performance in terms of property rights security

The assessment is conducted to get an overview of how good each project is in meeting standards referred to property rights security issues and to perform a comparative analysis. At the end, the assessment gives a comprehensive

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picture of how REDD implementation in Indonesia tackles the issue of securing property rights in practice. The assessment is operated by confronting results of interviews, together with some related information from project documents, with a framework of principles and criteria developed on purpose by modifying REDD+ Social and Environmental Standards published in 2010 by CCBA and CARE International. Taking into account the purpose of the thesis, the framework has been adapted to include only principles and criteria related to property rights and land tenure issues. The proposed framework for assessment is shown in Table 7. Table 7. Proposed framework for assessment of project performance in terms of property rights security
Principle 1: Right recognition 1.1 The REDD+ program effectively identifies the different rights holders (statutory and customary) and their rights to lands, territories and resources relevant to the program 1.2 The REDD+ program recognizes and respects both statutory and customary rights to lands, territories and resources which indigenous people or local communities have traditionally owned, occupied or otherwise used or acquired 1.3 the REDD+ program requires the free, prior, and informed consent of indigenous peoples and local communities for any activities affecting their rights to lands, territories and resources 1.4 The REDD+ program identifies and uses a process for effective resolution of any disputes over rights to lands, territories and resources related to the program and does not proceed with any activity that could prejudice the outcome of the dispute resolution process. 1.5 Where the REDD+ program enables private ownership of carbon rights or separate ownership for carbon, these rights are based on the statutory and customary rights to the lands, territories and resources that generated the greenhouse gas emissions reductions and removals Principle 2: equitable benefit sharing 2.1 The projected costs, potential benefits and associated risks of the REDD+ program are identified for relevant rights holder and stakeholder groups at all levels using a participatory process 2.2 Transparent, participatory, effective and efficient mechanisms are established for equitable sharing of benefits of the REDD+ program among and within relevant rights holder and stakeholder groups taking into account costs, benefits, and associated risks 2.3 There is transparent and participatory monitoring of the cost and benefits of the REDD+ program, including any revenues, and their distribution among relevant rights holders and stakeholders Principle 3. Attention to well being of indigenous people 3.1 The REDD+ program generates additional, positive impacts on the long term livelihood security and well being of indigenous peoples and local communities with special attention to the most vulnerable people Principle 4. Contributes to protection of human rights and good governance objectives 4.1 The REDD+ program leads to improvements in governance of the forest sector and other relevant sectors

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4.2 The REDD+ program contributes to respect and protection of human rights 4.3 There is strong government commitment to the REDD+ program 4.4 The REDD+ program is coherent with relevant policies, strategies and plans at all relevant levels and there is effective coordination between government and other agencies/organizations responsible for the design, implementation and evaluation of the REDD+ program and other relevant government agencies/ organizations Principle 5. Participation 5.1 The REDD+ program identifies and characterizes the rights and interests of all rights holder and stakeholder groups and their relevance to the REDD+ program 5.2 All relevant rights holder and stakeholder groups that want to be involved in REDD+ program design, implementation and evaluation are fully involved through culturally appropriate and effective participation 5.2 All relevant rights holder and stakeholder groups that want to be involved in REDD+ program design, implementation and evaluation are fully involved through culturally appropriate and effective participation 5.4 The relevant rights holders and stakeholders groups have a good understanding of the key issues related to the REDD+ program and the capacity to participate effectively 5.5 Design, implementation and evaluation of REDD+ program builds on, respects and supports rights holders and stakeholders traditional and other knowledge, skills, and management systems including those of indigenous peoples and local communities Principle 6. Access and transparency 6.1 Adequate information about the REDD+ program is publicly available to promote general awareness and good governance 6.2 Rights holders and stakeholders have the information that they need about the REDD+, provided in a culturally appropriate and timely way, to participate fully 6.3 Rights holder and stakeholder group representatives collect and disseminate all relevant information about the REDD+ program from and to the people they represent in an appropriate and timely way 6.4 The REDD+ program makes sufficient resources available to provide and collect information in a timely and appropriate manner Principle 7: Compliance with existing framework in local and national law 7.1 The REDD+ program complies with applicable local law and national law 7.2 Where local or national law is not consistent with the standards, a review process should be undertaken that results in a plan to resolve the inconsistencies 7.3 Relevant rights holders and stakeholders have the capacity to understand, implement and monitor legal requirements related to the REDD+ program

The above principles and criteria are covering important key elements in term of property rights and tenure security described in Chapter 2. They have been developed by taking into account rights recognition of both statutory and customary rights, equity concept, participation of all rights holders and stakeholders, and access for every relevant stakeholders. They also have strong link with FPIC concept of UNFCCC in addressing property right security issue in implementing REDD mechanism which also has been described in Chapter 2. In order to use at best the information collected through the interviews and, at the same time, provide a synthetic quantitative assessment of the projects, beside a qualitative ones, a scale of scores has been developed. Scores are

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given to each project based on their achievement in fulfilling all criteria in each principle. Scores range from zero to five and are assigned based on judgment after analyzing the evidences. Five is the highest score showing the project is considered fulfilling all criteria in a principle. In contrast, zero is the lowest score showing the project cannot fulfill any criteria at all. Although each principle consists of different number of criteria, every principle is deemed to have the same weight in the overall assessment. The result of the assessment is shown in Table 8 and in Figures 19 and 20.

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Table 8. Result of project quality assessment of five selected projects

REDD+ Social and Environmental Standards (adopted and modified from REDD+ Social and Environmental Standards by CCBA and CARE International, 2010) Principle 1: Right recognition Score 1.1 The REDD+ program effectively identifies the different rights holders (statutory and customary) and their rights to lands, territories and resources relevant to the program Evidences from interviews and project documents Demonstration activities Berau Forest Carbon UNREDD Carbon Program, Kalimantan Project in Central Sulawesi Voluntary Activities REDD in the Ulu REDD project by WWF Masen Ecosystem, in Jayapura Regency, Aceh Papua

Tropical Forest Conservation for REDD and enhancing carbon stocks in Meru Betiri National Park, East Java 4 Yes

2 Not yet

2 Not yet

3 Not yet

3 Not yet

National Park is owned by state. The ownership is clear and acknowledge by community. Within national park area, government have made zoning system for purpose of sustainable development, i.e. core zone, forest zone, rehabilitation zone, special use zone, and utilization zone (Kirsfianti L. Ginoga, 2010)

Lands in Berau district are owned by local government and communities however there is still unclear ownership for customary land (Fakhrizal Nashr, 2010) So far, there is no single agreed-upon map of Berau which take into account factors such as community perspective, food security,

Project site has not been decided yet therefore all rights holders in the site have not been inventarized yet (Machfudh, 2010)

FFI has been initiated participatory land use planning process, establishing jointly agreed boundaries and land use patterns, and developing multistakeholder management structure by involving communities and Mukim leaders (Rafli et al., 2007) This process has been completed

MoFor designated the area as state forest land and was allocated for production function. This area is overlapping with customary lands. WWF has conducted community mapping activities in three villages (Beneik,Gurusam, and Guriad) to show boundaries of their adat (customary) lands (WWF, 2009) Rest of areas have yet to be mapped

biodiversity goals and economic development planning (MoFor & TNC, 2009)

1.2 The REDD+ program recognizes and respects both statutory and customary rights to lands, territories and resources which indigenous people or local communities have traditionally owned, occupied or otherwise used or acquired Evidences from Interviews and project documents

No

No

No

only in district of Aceh Jaya (Rafli et al., 2007) Formal agreements with all the district governments for spatial planning had not been reached yet (SmartWood, 2008) Not yet

(WWF, 2009)

Not yet

No clear regulation to save right of community who live in closest village in accessing and utilizing land that have been rehabilitated by them during 1998 2000(Arif Aliadi, 2010) No clear management right of land and forest (Arif Aliadi, 2010)

Overlapping tenure (no clear ownership between de facto and de jure) (Fakhrizal Nashr, 2010 This situation will lead to conflict/dispute later due to claim by communities (Fakhrizal Nashr, 2010)

Customary lands are not recognized by central/ local government (it becomes a challenge for the project) (Machfudh, 2010) This situation will lead to conflict/ dispute later due to claim by communities (Machfudh, 2010)

Majority of the project site is designated as national forest land (Hutan negara) and there is potential for conflict over land status where local communities regards adjacent forest lands as traditional/ customary lands (Rafli et al., 2007) New Autonomy Law Aceh recognizes the role of Mukim as key

There is no clear tenure system (Zulfira Warta, 2010) There are still some conflict among tribal group regarding ownership of the land because of different social history as well among tribal group and government (Zulfira Warta, 2010) No sufficient mechanism in place to guarantee the ownership rights of indigenous people to

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structure to regulate land access (SmartWood, 2008) New Aceh provincial Government have moved strongly towards recognizing customary forest and land rights (SmartWood, 2008)

1.3 the REDD+ program requires the free, prior, and informed consent of indigenous peoples and local communities for any activities affecting their rights to lands, territories and resources Evidences from Interviews and project documents

Yes

Not yet

Not yet

Yes

their land and forest (WWF, 2009) Article of Papua Forestry Law stipulates that the Adat Community has the ownership rights over forest in their own customary land boundaries but local community cannot automatically exercise this right and use their forest as they please (WWF, 2009) Not yet

There is agreement between local communities and MBNP agency in developing and managing rehabilitation zone within national park to undertake agroforestry system unique to MBNP such as tetelan (an

The program will establish governance structures and consultative mechanisms to include communities in overall program decisions (MoFor & TNC, 2009) The project concern of FPIC concept (Fakhrizal Nashr,

Adhere as much as possible to FPIC although at this point UNREDD NJP activities have not been articulated enough to allow issues such as size, pace, and reversibility to be debated in a meaningful manner (MoFor, FAO, UNEP, UNDP,

Prior informed consent based on customary land tenure arrangements and resource access rights of local communities must be sought prior to the establishment of carbon forests or other substantive change in land use (Rafli et al., 2007)

Project is developing mechanism to implement FPIC from local communities for all of development projects (WWF, 2009)

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1.4 The REDD+ program identifies and uses a process for effective resolution of any disputes over rights to lands, territories and resources related to the program and does not proceed with any activity that could prejudice the outcome of the dispute resolution process. Evidences from Interviews and project documents

agroforestry land use system) with main tree among others is Kedawung (Parkia timoriana), which is a mutipurposes tree species (Arif Aliadi, 2010) Yes

2010)

Yes

2009) With FPIC approach, all related stakeholders will participate and tenurial conflict is expected will be solved (Machfudh, 2010) Yes

Work together with Mukim as representative of local communites in participatory spatial planning (Rafli et a l.,2007)

Yes

Yes

Two ways communication collaborating with NGO and local government (desa/village and kecamatan/ subdistrict) (Kirsfianti L. Ginoga, 2010) Stakeholder consultation (Arif Aliadi, 2010) Giving attention to role of each community in rehabilitation effort (Arif Aliadi, 2010) Giving incentive

Community participation (Fakhrizal Nashr, 2010) Stakeholder consultation (Fakhrizal Nashr, 2010) Follow CCBA standards (Fakhrizal Nashr, 2010)

Special team will be established to handle conflict (Machfudh, 2010) Stakeholder participation and consultation (Machfudh, 2010)

Community consultation collaborated with Mukim leader (Rafli et al. 2007) Involving communities and Mukim leaders in participatory land use planning processes (Rafli et al. 2007) Establishing jointly agreed boundaries and land use patterns (Rafli et al. 2007) Developing multi-

Adaptive management (Zulfira Warta, 2010) Model management of tenure claim (Zulfira Warta, 2010) Need support from regulation especially on tenure and benefit sharing issues (Zulfira Warta, 2010) There is unwritten agreement between WWF and community therefore lead to community acceptances (Zulfira

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(services) to community who do not join any program (Arif Aliadi, 2010)

stakeholder management structure (SmartWood, 2008) Participatory spatial planning, followed by final public consultations and district parliament approval has been started to arbitrate conflict and define boundaries and land use patterns (SmartWood, 2008)

Warta, 2010) Papuan government signed the law called Special Law regarding SFM in Papua but it is still unclear whether this law would effectively reduce tensions and confusions who has ultimate authority to manage Papuas forest (WWF, 2009) Village institution capacity enhancement so they would be able to facilitate interests among the villagers Not yet

1.5 Where the REDD+ program enables private ownership of carbon rights or separate ownership for carbon, these rights are based on the statutory and customary rights to the lands, territories and resources that generated the greenhouse gas emissions reductions and removals Evidences from Interviews and project documents

Not yet

Not yet

Not yet

Not mentioned

There is possibility in having multiple right for carbon since from conservation point of view, without

It is quite difficult to implement separate carbon ownership in context of national level carbon mechanism

No regulation and possibilities in having separate carbon ownership so far (Machfudh, 2010)

Project will facilitate owner of land and forest who would like to be active player in carbon trading. The

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removing the tree from national park area community can still collect NTFP from forest including benefiting from carbon sequestration (Arif Aliadi, 2010) No regulation supporting this case yet (Arif Aliadi, 2010) Principle 2: equitable benefit sharing score 2.1 The projected costs, potential benefits and associated risks of the REDD+ program are identified for relevant rights holder and stakeholder groups at all levels using a participatory process Evidences from Interviews and project documents 2 Not yet

(Fakhrizal Nashr, 2010) Need consideration social landscape (Fakhrizal Nashr, 2010)

application to get license in entering carbon market should be done by themselves (Zulfira Warta, 2010)

2 Not yet

2 Not yet

2 Not yet

2 Not yet

It is still in a plan that benefit will be shared and proportional to roles, contribution, and responsibilities of each stakeholders (Arif Aliadi, 2010)

it is still in a plan that benefit sharing will be discussed with all related stakeholders (Fakhrizal Nashr, 2010) during the pilot phase, the program will seek support for performance-based incentive programs primarily from public

it is still in a plan that benefit sharing will be discussed with all related stakeholders (Machfudh, 2010)

Indigenous people, local communities, and CSOs need to be encouraged and supported to participate fully and actively in the development of distribution mechanisms for avoided deforestation finances(SmartWoo

It is still in plan that benefit will be equally shared based on role of each stakeholder (Zulfira Warta, 2010)

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2.2 Transparent, participatory, effective and efficient mechanisms are established for equitable sharing of benefits of the REDD+ program among and within relevant rights holder and stakeholder groups taking into account costs, benefits, and associated risks Evidences from Interviews and project documents

Not yet

and private donors (MoFor & TNC, 2009) Not yet

d, 2008)

Not yet

Not yet

Not yet

Regulation about benefit sharing will be disbursed by Ministry of Forestry (Arif Aliadi, 2010) So far informal discussion about benefit sharing is done gradually with leader of group ( important and unclear issue will be kept temporarily in this level, then later will be informed to all member to avoid misunderstanding and money minded) (Arif Aliadi, 2010)

Still not clear because the project is multisectoral (Fakrizal Nashr, 2010) Since the regulatory framework for carbon rights has not yet been finalized in Indonesia, it is unclear what benefits could accrue to private investor from a REDD project in Indonesia at this time (MoFor & TNC, 2009) It is planned to create diverse forms of benefit sharing that are not tied to land ownership

Regulation about benefit sharing will be disbursed by Ministry of Forestry (Machfudh,2010) Clear mechanism is not yet available (Machfudh, 2010) Payment system will be developed at provincial level (MoFor, FAO, UNEP, UNDP, 2009) Benefit sharing could be not in cash (services and facilities) (Machfudh, 2010)

Carbon financing are to be further planned and developed over the next years (Smartwood, 2008) All project proponents are committed to ensuring that benefits are equitably shared among stakeholders, including forest dependent communities and those with customary rights to forest land (Rafli et al., 2007) After the initial phase of the project, carbon

No clear regulation about benefit sharing yet (Zulfira Warta, 2010) No benefit sharing mechanism so far because it is sensitive issue (Zulfira Warta, 2010) In the future the benefit sharing will be adjusted with legal and customary right to fulfill equity and fairness aspect (Zulfira Warta, 2010)

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(MoFor & TNC, 2009)

2.3 There is transparent and participatory monitoring of the cost and benefits of the REDD+ program, including any revenues, and their distribution among relevant rights holders and stakeholders Principle 3. Attention to well being of indigenous people score 3.1 The REDD+ program generates additional, positive impacts on the long term livelihood security and well being of indigenous peoples and local communities with special attention to the most vulnerable people Evidences from Interviews and project documents

Not mentioned

Not mentioned

Not mentioned

finance from sale of VERs must be secured to provide immediate and substantial incentive payments to all relevant stakeholders who help the project area arrest deforestation (Rafli et al., 2007) Not mentioned

Not mentioned

4 Not yet

4 Not yet

3 Not yet

5 Yes

4 Yes

One of project objectives is to improve livelihoods of local communities living inside and

One of project objectives is creating improved economic outcomes and opportunities for

However issue on well being of indigenous people is not the main concern, analysis of potential socio-

Project is attempted to help communities develop forms of livelihoods based on new or

One of project objectives is to be able to conserve forest biodiversity and livelihood of people whose lives

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surrounding area of Meru Betiri NP (Kirsfianti L. Ginoga, 2010) It is still a challenge for the project to find out how to improve livelihood through improved existing activities familiar to them in term of productivity, market and technology (Arif Aliadi, 2010)

communities living near forests (MoFor & TNC, 2009) Berau Program will develop additional financial incentives and contractual arrangements for concessioners to move towards improved management, certification and marketing of sustainably harvested-wood (MoFor & TNC, 2009) The program will invest in alternative livelihoods programs in target areas to support low-carbon development strategies (MoFor & TNC, 2009)

economic impacts of REDD on communities will be conducted (MoFor, FAO, UNEP, UNDP, 2009)

alternatives practices, such as community forestry, agroforestry, reforestation, plantations which may preclude their participation in unsustainable logging practices (SmartWood, 2008) 20% of credit reserve is to be used to fund local carbon projects to promote alternative livelihoods to avert leakage( SmartWood, 2008) There are several incentives to local villages for their involvement in forest protection (Rafli et al., 2007)

dependent on these forests (WWF, 2009)

Principle 4. Contributes to protection of human rights and good governance objectives score 4.1 The REDD+ program leads to improvements in governance of the forest sector and other relevant sectors Evidences from

2 Not mentioned

4 Yes

4 Yes

5 Yes

4 Yes

Using REDD as

Using REDD to

Some of project

One of projects

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Interviews and project documents

vehicle of decentralization (Fakhrizal Nashr, 2010) The project will design a governance structure that generates effective decisions supported by a wide range of stakeholders (MoFor & TNC, 2009)

enhance capacity of local government in managing forest in context of local development planning, supporting establishment of FMU (MoFor, FAO, UNEP, UNDP, 2009) Assist local governments with preparing and piloting REDD activities on the ground (MoFor, FAO, UNEP, UNDP, 2009)

4.2 The REDD+ program contributes to respect and protection of human rights Evidences from Interviews and project documents

Yes

Yes

Yes

activities is developing capacity of relevant provincial government, identifying and documenting opportunities to strengthen forest management, forest governance and forest law enforcement processes at provincial, district, Mukim, and village level (Rafli et al., 2007) Project activities have been designed to develop effective and accountable governance (Rafli et al., 2007) Yes

objective is to assist the local government in designing an effective pro-poor, environmentally sound, and good governance development planning process (WWF, 2009)

Yes

Implementation of REDD in every forested land would have positive implication on tenurial as it would create more incentive for

REDD can be trigger tenurial reform because through incentive based mechanism will trigger clear ownership (Fakhrizal Nashr,

REDD will give positive influence to tenure reform if well implemented (Machfudh, 2010)

Project guarantee that there is no encroachment uninvited on private property, community property or government property

Rely on CCBA standard as basis of project implementation which require respectful of tenure and social aspect on REDD design

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management of land in more sustainable way (Arif Aliadi, 2010)

2010)

4.3 There is strong government commitment to the REDD+ program Score Evidences from Interviews and project documents

Yes

Yes

Yes

(SmartWood, 2008) Project guarantee that there is no plan to relocate or move people out from the project management areas (SmartWood, 2008) The project will build off the process framework to ensure community and individual concerns can easily be directed to the project and are ensured a timely and fair process for review and project modification if necessary (Rafli et al., 2007) Yes

(Zulfira Warta, 2010) REDD will give positive influence to tenure issue (Zulfira Warta, 2010)

Yes

Local government is supporting REDD activities on site (Arif Aliadi, 2010)

Berau District is interested in moving towards more sustainable outcomes and REDD is enable to achieve these outcomes (Head of districts statement

Provincial and district governments are developing policies and have shown interest in developing REDD (MoFor, FAO, UNEP, UNDP, 2009)

While waiting for a guideline of national REDD mechanism, Aceh established REDD working groups, namely Green Aceh (MoFor, FAO, UNEP, UNDP,

Since 2009, local government stops giving new license for oil palm plantation which support REDD program(Zulfira Warta, 2010) Government of

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in Tharyat & Siswanto, 2009) In April 2008, the Bupati of Berau created a REDD Working Group to explore opportunities for developing a REDD pilot program in Berau. This working group is now formally linked through Joint Working Group with MoFor representatives (MoFor & TNC, 2009)

2009) Governors Decree of October 31, 2007 number 522.1/534/2007 commits to provide information on land tenure allocation and design (SmartWood, 2008) Provincial government commits to reduce legal logging licences (SmartWood, 2008)

4.4 The REDD+ program is coherent with relevant policies, strategies and plans at all relevant levels and there is effective coordination between government and other agencies/organizations responsible for the design, implementation and evaluation of the REDD+ program and other relevant government agencies/ organizations Evidences from Interviews and project

Not yet

Not yet

Not yet

Yes

Papua is actively pursuing REDD and is in the process of developing a REDD policy which is well embedded and linked into a national program (MoFor, FAO, UNEP, UNDP, 2009) Government representatives in Jayapura regency were interested in this idea and willing to sign agreement with WWF Indonesia for 10 years commitment to develop REDD mechanism (WWF, 2009) Not yet

Sometimes policies of local government

The project is trying to link the low

Project outcomes, particularly spatial

The project has or expect to secure

Unsynchronized interpretation of

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documents

relating with management of area surround national park lead to open access of the park and leakage which is still become a challenge (Arif Aliadi, 2010) coordination among public private partnership technically and institutionally in Measuring Reporting and Verifying (MRV) is still need to be improved (Kirsfianti L. Ginoga, 2010)

emissions program with provincial/ district spatial planning in order to avoid leakage(MoFor & TNC, 2009) Overlapping and contradicting of authorities and policies between central and local government is still a challenge for project (Fakhrizal Nashr, 2010) There is no synergy between local/ district aspiration with forestry law and REDD program (Fakhrizal Nashr, 2010)

planning in line with MoFor policy to sustain forests and its management such as the ongoing KPH development program(MoFor, FAO, UNEP, UNDP, 2009) In formulating the REL at provincial level, UNREDD will ensure it will be synchronized with what has been developed by GOI at national level(MoFor, FAO, UNEP, UNDP, 2009).

approval from appropriate authorities (SmartWood, 2008). By preventing deforestation, project proponents will help Aceh achieve a sustainable future that also preserves critical and highlythreatened habitat for biodiversity and develop a sustainable community model for the use and conservation of forest (Rafli et al., 2007)

authority to manage forest resources, forest property and land tenure rights, implementation of Papua special law on forest management, and REDD procedures and governance and its distribution of financial flows between central and local government (Zulfira Warta, 2010, WWF, 2009) There are several concessions, palm oil plantation, and mining areas within REDD project boundaries got license from national govt. (WWF, 2009) Coordination between offices in the development planning process is weak (WWF, 2009) 2 Yes

Principle 5. Participation score 5.1 The REDD+ program identifies and characterizes the rights and interests of all rights holder and stakeholder groups and their relevance to the REDD+ 3 Yes 4 Yes 4 Yes 3 Yes

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program Evidences from Interviews and project documents The project will engage all stakeholders in all activities however it is still a challenge to integrate all different interest from each stakeholders (Arif Aliadi, 2010) BFCP will engage communities and people living in and near forest areas, private sector investors and employees, government officials and agencies at all levels, and range of CSOs (MoFor & TNC, 2009) UNREDD is aware of the concerns raised by local communities and CSOs of an emerging REDD scheme in Indonesia (MoFor, FAO, UNEP, UNDP, 2009) The project has a strong component towards increasing a range of community interest and stakeholders in the project implementation (SmartWood, 2008) Project is supported by a tri-partnership of government, non- governmental, NGOS/CSOs, and private sector. Every partners has their own role and interest (Rafli et al., 2007) Yes Project is consist of different stakeholder and in process of stakeholder discussion, all of their interest will be addressed (Zulfira Warta, 2010)

5.2 All relevant rights holder and stakeholder groups that want to be involved in REDD+ program design, implementation and evaluation are fully involved through culturally appropriate and effective participation Evidences from Interviews and project documents

Yes

Yes

Yes

Yes

Communities are taking part in several activities e.g. reducing illegal logging, lowering carbon emission, forest monitoring (Arif Aliadi, 2010)

Collaborative forest management among government, business company, and community (Fakhrizal Nashr, 2010)

Communities, CSO, and NGO will support UNREDD activities (actively and passively) (Machfudh, 2010) On 20 May 2009, an in-depth stakeholder consultation with

Project has been conceived to ensure that stakeholder confidence and commitment will be built through participatory and transparent process

REDD governance concept is discussed widely with the key stakeholders in Papua (WWF, 2009) Finding of study is discussed with all

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5.3 The relevant rights holder and stakeholder groups determine, in a verifiable manner, the process and mechanism by which they will participate and be represented in relation to the REDD+ program, taking account of statutory and customary institutions Evidences from Interviews and project documents

Yes

Yes

local community representatives and CSOs was conducted as part of development of UNREDD Programme (MoFor, FAO, UNEP, UNDP, 2009) Initiatives relevant to UNREDD activities developed by local community representatives, NGOs and CSOs is inserted to logical framework (MoFor, FAO, UNEP,UNDP, 2009) Yes

(Rafli et al., 2007) All levels of govt and civil society have been invited to contribute to the design and implementation of project activities (Rafli et al., 2007) Project has a wide range of activities and all of those activities done in conjunction with communities (SmartWood, 2008)

key stakeholders (WWF, 2009)

Yes

Not mentioned

Community can choose their representative in stakeholder consultation process (Arif Aliadi, 2010)

Communities will be linked more effectively to land use planning, management, and governance (MoFor & TNC, 2009)

Relevant right holders and stakeholder groups will be members of National Project Board (NPB) (MoFor, FAO, UNEP,UNDP, 2009)

Mukims in the project area have taken apart in participatory spatial planning, and that others have taken part in spatial planning workshops

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5.4 The relevant rights holders and stakeholders groups have a good understanding of the key issues related to the REDD+ program and the capacity to participate effectively Evidences from Interviews and project documents

Not yet

Collaborative management between communities and companies in timber concessions and between communities and government (MoFor &TNC, 2009) Not yet

Community will be represented by their community organization (Machfudh, 2010)

Not yet

or in mitigating human-wildlife conflicts (SmartWood, 2008) Mukims and communities are taking part in consultation process (Rafli et al, 2008) Not mentioned

Not mentioned

Currently, the knowledge on REDD is still very limited therefore the project is conducting some awareness raising training and institutional building for REDD and REDD+ (FORDA & ITTO, 2010 a)

Currently, information about REDD is still not clear in community level. Therefore the project developer need to be careful in giving information and community need to be clever in understanding the mechanism (Fakhrizal Nashr, 2010)

Information about REDD is still not clear in community level. Therefore socialization is needed to be done in the beginning of the project (Machfudh, 2010) Currently, the knowledge on REDD is still very limited and the interpretation of what REDD can bring in terms of benefits but also responsibilities is still very diverse (MoFor, FAO, UNEP, UNDP, 2009)

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5.5 Design, implementation and evaluation of REDD+ program builds on, respects and supports rights holders and stakeholders traditional and other knowledge, skills, and management systems including those of indigenous peoples and local communities Principle 6. Access and transparency score 6.1 Adequate information about the REDD+ program is publicly available to promote general awareness and good governance Score Evidences from Interviews and project documents

Not mentioned

Not mentioned

Not mentioned

Not mentioned

Not mentioned

3 Yes

2 Not yet

2 Not yet

4 Yes

1 Not mentioned

Consultation process with communities and other stakeholders has been undertaken to increase self motivation and understanding as well as benefit of REDD (Arif Aliadi, 2010) Not mentioned

Program partners are now evaluating options for local pilot to support the national Forest Resource Information System (early stage of development) (MoFor & TNC, 2009) Not mentioned

Communication among UNREDD stakeholders still need to be strengthened especially between local community representatives/NG Os/CSOs and local government (MoFor, FAO, UNEP, UNDP, 2009) Not mentioned

6.2 Rights holders and stakeholders have the information that they need about the REDD+, provided in a

All non-proprietary documents will be publicly available and in Bahasa language at the offices if FFI, as well as at the CCB website, the governors office and posted on these two offices websites (SmartWood, 2008) Not mentioned

Not mentioned

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culturally appropriate and timely way, to participate fully 6.3 Rights holder and stakeholder group representatives collect and disseminate all relevant information about the REDD+ program from and to the people they represent in an appropriate and timely way Evidences from Interviews and project documents

Not mentioned

Not mentioned

Not yet

Yes

Not mentioned

Participation is normally through representation and it sometimes lead to risk that not every household can get the information or even express their opinion/ideas, having opportunities to accept or refuse (Machfudh, 2010) Yes Yes Yes

6.4 The REDD+ program makes sufficient resources available to provide and collect information in a timely and appropriate manner Evidences from Interviews and project documents

Information that was generated from the Mukim level planning was then discussed in an inter-Mukim meeting. People in the Mukim level meeting decided who should be the representative for their Mukim to attend the intermukim meeting Yes

Yes

Information on good practice gained and scale up lessons learn is distributed through training, workshop, institutional building, and

Information will be distributed through educational and training initiatives, also through cadre of experts (MoFor & TNC, 2009)

Information will be distributed through social marketing campaign; REDD information, education and communication materials;

Information is distributed through training, capacity building, community development, and publications in local and/or national media (SmartWood,

Information will be distributed through training, workshop (WWF, 2009)

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publications (MoFor & ITTO, 2010d)

conference or panel discussion; training; and publication on lesson learned (MoFor, FAO, UNEP, UNDP, 2009) Consultation minutes is distributed by email to the local community representatives/CSO participant for further input (MoFor, FAO, UNEP, UNDP, 2009)

2008)

Principle 7: Compliance with existing framework in local and national law score 7.1 The REDD+ program complies with applicable local law and national law Evidences from Interviews and project documents

1 Yes

1 Yes

1 Yes

1 Yes

1 Yes

All activities are arranged integrating with exist regulations (Kirsfianti L. Ginoga, 2010) Unclear regulation which is supporting national park and environmental friendly activities (Arif Aliadi, 2010) Reformation of forestry law and

All program will link with existing regulation on REDD in national and local level (the grelated regulations as guideline) (Fakhrizal Nashr, 2010) However there is no synergy between local/district aspiration with forestry law (Fakhrizal Nashr,

Project Management Unit (PMU) responsible for reporting UNREDD funds in accordance with the rule and regulations for nationally implemented project (MoFor, FAO, UNEP, UNDP, 2009) All programme asset and services

Government Regulation PP 6/ 2007 provides a key legal basis for the implementation of this project(Rafli et al., 2007) Special autonomy law for Province of Aceh provides a further important legal basis for the retention and equitable sharing of funds generated

Activities of project should be additional to what would have already been required by current government regulations and policy (WWF, 2009) REDD program will comply all regulation which link with REDD to get legitimating (Zulfira Warta, 2010) The project will

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other related regulation and recognition of customary land and customary land are needed in successful of REDD implementation (Arif Aliadi, 2010)

2010)

shall be procured in line to GoI and UN rules and regulations (Machfudh, 2010)

through REDD carbon financing within the province (Rafli et al., 2007) Project will not broke existing laws and will keep low conflict between authority in central, provincial, and regional levels of government (SmartWood, 2008) Project is lead by provincial government to ensure compliance with and integration with governmental and regulatory structures (Rafli et al., 2007) Governors decree for new provincial spatial plan provides the authority to carry out most core project activities related in terms of participatory forest management process (Rafli et al., 2007) Current legal arrangements need

integrate with Indonesias regulations and policies concerning REDD development procedures (WWF, 2009) however current regulation and policy regarding environmental services and REDD is biased toward forestry sector (Zulfira Warta, 2010

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7.2 Where local or national law is not consistent with the standards, a review process should be undertaken that results in a plan to resolve the inconsistencies 7.3 Relevant rights holders and stakeholders have the capacity to understand, implement and monitor legal requirements related to the REDD+ program

Not mentioned

Not mentioned

Not mentioned

strengthening, negotiations will be undertaken with those responsible for relevant legislation at provincial and national level (Rafli et al., 2007) Not mentioned

Not mentioned

Not mentioned

Not mentioned

Not mentioned

Not mentioned

Not mentioned

Note:
Consideration Score Fulfill all criteria 5 Fulfill almost all criteria 4 Fulfill criteria partly 3 Fulfill few of criteria 2 Fulfill only one criteria 1 Fulfill no criteria at all 0

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Figure 19. Project quality assessment of five selected projects

123

a.

b.

c.

d.

c.

d.
124

e.
Figure 20. Detail of project quality assessment of five selected projects a. In Meru Betiri National Park, East Java; b. in Berau District, Kalimantan; c. in Central Sulawesi; d. in Ulu Masen, Aceh; and e. in Jayapura Regency, Papua

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REDD project in Meru Betiri National Park, East Java has the higher score in right recognition compared with others because the ownership of the area is clear and communities acknowledge it. Based on Regulation no. 5/ 1990 article 34 and Forestry Law No.41/1999, national park is forest area part of state forest and managed directly under the authority of the central government. Although there are 12 villages in buffer zone and 6 villages on border of national park area, there is no overlapping of land ownership in the project site (Kirsfianti L. Ginoga, 2010). The biggest issue in this project is not the land ownership but more the unclear management rights of rehabilitation land which was managed together with local communities during 1998 2000 (Arif Aliadi, 2010). In addition, this project is one of site level intervention projects which focuses only on the area of national park compared with landscape intervention projects which cover wider area with more complex land ownership. However there is still tenurial conflict and claim in almost all project sites, but there are some positive movements in recognizing customary land and taking into account local community institutions shown in case of the two voluntary projects. In Aceh, FFI has initiated participatory land use planning processes, establishing jointly agreed boundaries and land use patterns, and developing multi-stakeholder management structure by involving communities and Mukim leaders (Rafli et al., 2007). The same activities have been initiated by WWF in three villages in Jayapura Regency (Beneik, Gurusam, and Guriad) to show boundaries of their adat (customary) lands (WWF, 2009). Local government in the two areas also supports this movement by establishing New Autonomy Law Aceh which recognizes the role of Mukim as key structure to regulate land access (SmartWood, 2008) and Article of Papua Forestry Law which stipulates that the Adat Community has the ownership rights over forest in their own customary land boundaries (WWF, 2009). All projects is concerned in implementing the concept of the Free Prior Informed Consent (FPIC) of indigenous peoples and local communities for any activities affecting their rights to lands, territories, and resources however almost all of them are still in planning phase, not yet implemented in practice. At the moment, the projects are on the stage of giving much attention to right recognition of related stakeholders especially local communities and developing effective resolution of any disputes over rights to lands, territories, and

resources e.g. stakeholder consultation and participatory programmes in order to get support and success in benefiting from REDD mechanism. Although there is an idea of promoting separate carbon ownership as part of NTFPs in rehabilitation land in REDD project in Meru Betiri National park , the issue of private carbon right recognition and separate carbon ownership are still in controversial since there is no clear regulation and mechanism supporting this case yet. Benefit sharing is another important concern in implementing REDD mechanism. To be equitable and fair, mechanisms should be able to address all rights of related stakeholders including forest dependent communities and those with customary right and to share the benefit proportionally based on their roles, contributions and responsibilities. Based on the assessments result, all selected projects has the same, quite low score. This is because there is no clear regulation and mechanism on this issue yet even in international level. Therefore, this issue is still in planning, not yet a main concern. At this phase, all projects stated that the mechanism will be discussed with all related stakeholders and equally shared based on their role. The planned mechanisms vary from one project to the other. In Meru Betiri National Park, discussion on benefit sharing has been done gradually with community group leaders (Arif Aliadi, 2010). Berau Carbon Forest Program proposed to have diverse forms of benefit sharing not tied to land ownership to facilitate complex land and forest ownership (MoFor & TNC, 2009). REDD Project in Ulu Masen proposed to have secure carbon finance from sale of VERs to provide immediate and substantial incentive payments (Rafli et al., 2007).Then, some projects proposed to share the benefits in form of services not in cash. REDD project in Ulu Masen, Aceh is the best example for its attention to the well being of indigenous people followed by BFCP in Kalimantan, REDD project in MBNP, and REDD project in Jayapura Regency. Ulu Masen REDD program has prepared clearer program in developing livelihood of local communities such as community forestry, agroforestry, reforestation plantations to preclude communities participation in unsustainable logging practices, giving incentives for forest protection, and even allocating 20% of credit reserve to promote alternative livelihood (SmartWood, 2008). BFCP and REDD project in MBNP also have more or less the same programme.

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REDD project in Ulu Masen also became best example for its contribution to protection of human rights and good governance. This project is able to fulfill all criteria and it has good program which leads to improvement of governance and contributes to respect and protection of human rights. It has been approved by SmartWood auditors as well. This success is achieved also because of strong will and commitment from local government in developing REDD in Aceh by establishing REDD working group namely Green Aceh, establishing Governors decree on land tenure and design, and committing on reducing legal logging license . Similar positive support is also shown by two local governments: the local government of Berau District is creating REDD working group to explore opportunities for developing REDD pilot program in Berau (MoFor & TNC, 2009) while the local government of Jayapura Regency is signing an agreement with WWF Indonesia for 10 years commitment to develop REDD mechanism (WWF, 2009) and stopping giving new license for oil palm plantation since 2009 (Zulfira Warta, 2010). Although all projects have proposed activities coherent with relevant policies and strategies, overlapping and unsynchronized policies between national and local governments remain as one big challenge in implementing REDD. Consultation and participation are crucial components of consent process (UNREDD & MoFor, 2010), part of Free Prior Informed Consent (FPIC). Although in general, projects achievement in addressing participation is only at a medium level, all projects shows concern in identifying and charaterizing rights and interests of all rights holder and stakeholders also involving them fully in REDD design and implementation. There are various activities that have been conducting together with all rights holders and stakeholders starting with collaborative forest management including reducing illegal logging, forest monitoring, and lowering carbon emission; stakeholder consultation and taking into account initiative REDD program by local communities, NGOs and CSOs. Eventhough good mechanisms of involving all relevant rights holders and stakeholders have been established , not all of them have good understanding of key issues on REDD program. It can be seen in cases of REDD projects in Meru Betiri National Park, Berau Forest carbon Program, and in Central Sulawesi. Therefore socialization is needed in the beginning of project design.

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Unfortunately, there is no project among the five builds its REDD program taking into acoount also the respect and support of rights holders traditional and other knowledge, skills, and management system. Access and transparancy are also part of FPIC concept, which link with providing adequate and important information to all rights holders and stakeholders. Results of assessment show that each project has different achievement in fulfilling this principle. REDD project in Ulu Masen, Aceh is the best example in providing adequate information about REDD in Bahasa and in English. Those information are publicly availabe through website of project proponents (Aceh government and FFI) and some publications. Moreover, information is also disseminated through training, capacity building, workshops, campaign, and cadre. In case of using cadre as information agent, the best practice is also shown in Aceh where Mukim as representative of local communities collect and disseminate all relevant information from and to people they represent. Although all projects has disseminated the information through different medias and mechanisms, there is no information whether all rights holders and stakeholders have the knowledge they need or not. Regarding legal issues, all projects are complying applicable local and national law in carrying out their program. In case of REDD in Ulu Masen Aceh, project is lead by provincial government to ensure compliance and integration with governmental and regulatory structures (Rafli et al., 2007). However, until now, contradicting and overlapping policies and regulations in local and national level as effect of decentralization process still are an obstacle to all projects in implementing REDD mechanism in project site. There is no information about any review process undertaken to resolve this inconsistency. Moreover, it seems that relevant rights holders and stakeholders dont have the capacity to understand, implement and monitor legal requirements in REDD either.

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6.
6.1

Conclusions and recommendations

Conclusions The result of this study indicate that technically Indonesia is ready to implement REDD. From concept of Streck (2009) on better implementation of REDD in national level, although it is obvious that Indonesia fulfilled all of the points, issue of property right and tenure security especially for local communities has not yet been a concern so far. Property rights and tenure system is still unclear and community tenure security is still low. Policies and regulations on this issue are contradictory at the two levels the local and the national ones. However, there are some positive initiatives from local government toward recognizing and supporting existence and rights of local communities by establishing province level of regulation on customary rights and taking into account their participation in decision making. These initiatives also supported by NGOs and CSOs. In terms of property rights security, studies from Australia show that carbon can be a seperate object from forest and land and that forest owner can take advantage from various carbon ownership regimes. To get higher tradability, it is better to have separate carbon ownership as implemented in New South Wales. Although this mechanism can be considered as a model in reforming existing carbon ownership regime in Indonesia, it seems delicate to do so because of the complexity of the issue and of the specific Indonesian situation. Here, almost all forest area is owned or controlled by the State and a very complex stratification of official and customary and tenure titles and right distribution exists. In practical level, results of REDD projects assessment show that both demonstration and voluntary activities have medium level of concern on issue of property rights and tenure recognition, attention to well being of local communities, contribution to protection of human rights and good governance, participation, also access and transparency. However, their concern still lacks in issue of benefit sharing and compliance with existing law. It is not because they are not concerned with those issue but because they are still more into technical problems especially unclear supporting regulation and mechanism.

Overall, methodology and analysing concept are good tools to answer reserach questions. However, some development would be better to be done in the future especially in addressing some issues which can be covered so far in this reserach like monitoring; impact assessment; information availability for all relevant rights holders and stakeholders; dissemination of information; acknowledgement of local knowledge; review process for inconsistency; and capacity of the relevant rights holders and stakeholders on REDD to understand, implement, and monitor concept and legal requirement for REDD

6.2

Recommendations Since the study is operated by using an approach based on case studies method, only partial picture of Indonesian situation is obtained. However, criteria for selecting the cases developed in this thesis have allowed an appropriate representativeness of result. Improvement for further research can be done by widen selected project area which can cover some big islands in Indonesia.

In case of using interview as tool in collecting data, content of questionnaire and respondent selection are also needed to be set properly in order to get better result. Good criteria which cover all situations should be set in order to ensure validity and representativeness of result. Moreover, with time limitation, interviwer should be active in contacting respondent in order to get all of them have time for interview or even for filling the questionnaire and sending it through email. In fact , all projects are now in readiness phase therefore the focus of this thesis and the assessment of project performance are limited on planning phase, the earlier phase of development of REDD mechanism. It can be an idea to assess the performance after REDD implementation on ground. Finally, it was quite difficult to adopt a concept from two countries that have different situation and legal system on property rights e.g. carbon rights in Australia. It will be better for further research to use the concept of a reference country that has more or less same situation and legal system on property rights.

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Thorburn, C.C (2002): The plot thickens: Decentralisation and land administration in Indonesia. Victoria, Australia: Program in International Development and Environmental Analysis (IDEA) Monash University. Varghese, P. (2009): An Overview of REDD, REDD plus, and REDD readiness. International conference on community rights, forests, and climate change 17-18 August 2009 in New Delhi. Fellow, TERI. Vatn, A. (2005): Institutions and the environment. Cheltenham, UK: Edward Elgar Publishing Limited. pp. 252- 299. White, A. (2004): Introduction: The problem of inadequate and insecure community property rights over community forests. In Ellsworth, L. And White, A. (2004): Deeper roots: strengthening community tenure security and community livelihoods. New York: The Ford Foundation. pp. 6 -7. White, A. (2004): A framework for assessing tenure security. In Ellsworth, L. And White, A. (2004): Deeper roots: strengthening community tenure security and community livelihoods. New York: The Ford Foundation, pp.9 -16. White, A. (2004): Conclusions and Recommendations. In Ellsworth, L. And White, A. (2004): Deeper roots: strengthening community tenure security and community livelihoods. New York: The Ford Foundation, pp.27 - 30. White, A. and Martin, A. (2002): Who owns the worlds forests? Forest tenure and public forests in transition. Washington D.C: Forest Trends and Center for International Environmental Law. Wertz-Kanounnikoff, S. and Angelsen, A. (2009): Global and national REDD+ architecture: Linking institutions and actions. In Angelsen, A. with Brockhaus, M.; Kanninen, M.; Sills, E.; Sunderlin,W. and Wertz-Kanounnikoff, S. (Eds.): Realizing REDD+: National strategy and policy options. Bogor, Indonesia: Center for International Forestry Research (CIFOR). WWF Indonesia (2009): REDD project proposal in Jayapura Regency: Baseline information. Jakarta: World Wide Fund (WWF) Indonesia. Yin, R.K. (1994): Case study research: Design and methods (second edition). Beverly Hills: Sage publication. Zainal, Z. (2007): Case study as a research method. In Jurnal Kemanusiaan bil. 9, Jun 2007. Malaysia: Faculty of Management and Human Resource Development, Universiti Teknologi Malaysia.

Web sites
http://www.bbc.co.uk/weather/world/country_guides/results.shtml?tt=TT002320, date of grasp 7 July 2010
http://www.britannica.com/EBchecked/topic/286480/Indonesia, date of grasp 7 July 2010. https://www.cia.gov/cia/publications/factbook/index.html, date of grasp 9 November 2009.
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http://www.indonesiamatters.com/images/sulawesi-map.png, date of grasp 7 September 2010. http://www.lib.utexas.edu/maps/middle_east_and_asia/indonesia_pol_2002.jpg

http://www.rurallaw.org.au/handbook/xml/ch02s05.php, date of grasp 29 September 2010.

http://hepuru.files.wordpress.com/2010/07/map-wp3.jpg

Legislation
Law No. 5/ 1960 (UUPA) on Basic Agrarian Law (BAL). Law No. 5 / 1990 on Biodiversity Conservation. Law No.41/ 1999 on Forestry (Basic Forestry Law). Law No.22/ 1999 on Decentralization. Regulation No. 5/ 1999 A Manual of Conflict Resolution for Ulayat Rights related problems. Law No.18/ 2001 on Special Autonomy in Aceh. Law No.26/ 2007 on Spatial Planning. Presidential Regulation of the Republic of Indonesia Number 46 Year 2008 on National Council for Climate Change. Decree of Minister of Forestry Number: SK.455/ Menhut-II/ 2008 on Working Group on Climate Change in the Department of Forestry. Regulation No. 36/2008 on REDD Demonstration Activities. Regulation of Minister of Forestry Republic of Indonesia No. P.30/Menhut-II/ 2009 on The Implementation Procedures of Reducing Emissions from Deforestation and Forest Degradation. Regulation of Minister of Forestry Republic of Indonesia No. P.36/Menhut-II/2009 on Procedures for Licensing of Commercial Utilization of Carbon Sequestration and/or Storage in Production and Protected Forest.

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Annexes Annex 1 - Terminology

Adat: Custom. A non-codified collection of rules of formal behaviour, upheld through social sanctions, varying from time to time and place to place (Dunlop, 2009) or an action or practice that has taken place since time immemorial and that is not regulated by the state or other authority outside the social group. Aforestation: the direct human-induced conversion of land that has not been forested for a period of at least 50 years to forested land through planting, seeding and/or the human-induced promotion of natural seed sources (UNFCCC, 2008). Akta jual beli: sale and purchase agreement. Often used as evidence of ownership at the village level (Dunlop, 2009) Akta tanah: land ownership document (Dunlop, 2009). Annex I and Non Annex I: Under the Kyoto Protocol, national governments are separated into two general categories, developed countries, referred to as Annex I countries (the 36 industrialized countries and economies in transition, who have a non-binding commitment to reducing their GHG emissions to 1990 levels by the year 2000) and developing countries, referred to as Non-Annex I countries (who have no binding greenhouse gas emissions and may participate in the Clean Development Mechanism) (IFCA, 2008; Dunlop, 2009). Annex B Countries: the 39 emissions-capped industrialized countries and economies in transition listed in Annex B of the Kyoto Protocol. Legally binding emission reduction obligations for Annex B countries range from an 8% decrease to a 10 % increase on 1990 levels by the first commitment period of the Protocol, 2008 -2012 (IFCA, 2008). Anthropogenic: from the consequences of human activities. In the IPCC guidelines, anthropogenic emissions are distinguished from natural emissions. Many of the greenhouse gases are also emitted naturally. It is only the increments resulting from human activities additional to natural emissions that may be perturbing natural balance. In the LULUCF-GPG, all emissions and removals of managed lands are seen as anthropogenic. Baseline: a projection of emissions from deforestation and degradation and serves as a reference for measuring reductions in emissions based on a designated reference year of period. It is function of projected area change combined with the corresponding change in carbon stocks and will need to be negotiated among Parties (IFCA, 2008). Cap and trade: A Cap and Trade system involves trading emission allowances, where the total allowances is strictly limited or capped. Trading occurs when an entity has excess allowances, either through actions taken or improvements made, and sells them an entity requiring allowances because of growth in emissions or an inability to make cost effective reductions (IFCA, 2008). Carbon dioxide (CO2): this greenhouse gas is the largest contributor to man-made climate change, emitted from fossil fuel burning and deforestation (IFCA, 2008). Carbon pool: A system which has the capacity to accumulate or release carbon. Examples of carbon pools are forest biomass, wood products, soils, and atmosphere. The units are mass (e.g., t C) (IPCC, 2000). Carbon rights: the rights to enter into contracts and national or international transactions for the transfer of ownership of greenhouse gas emissions reductions or removals and the maintenance of carbon stocks (CCBA, 2010).

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Carbon Stock: The absolute quantity of carbon held within a pool at a specified time (IPCC, 2000) Certification: the written assurance by third party that, during a specified time period, a project activity achieved the reductions in anthropogenic emissions by sources of greenhouse gases (GHG) as verified (IFCA, 2008). Certified Emissions reductions (CERs): tradable units issued by the UN through the Clean Development Mechanism for emission reduction projects in developing countries. Each CER represents one metric ton of carbon emissions reduction. CERs can be used by Annex 1 countries to meet their emissions goals under the Kyoto Protocol (IFCA, 2008). Clean Development Mechanism (CDM): A provision of the Kyoto Protocol that allows developed countries (Annex 1) to offset their emissions by funding emissions reduction projects in developing countries (non-Annex1) (IFCA, 2008). The CDM aims to not only reduce emissions but also contribute to the sustainable development of the host country (Dunlop, 2009). Commons: Land or other natural resources used simultaneously or serially by the members of a community (Bruce, 1998) Co-ownership: Joint ownership by more than one legal person (Vatn, 2005). Costs, benefits and risks of the REDD+ program include those that are direct and indirect and include social, cultural, human rights, environmental and economic aspects. Costs should include those related to responsibilities and to opportunity costs. All costs, benefits and risks are compared against the reference scenario which is the most likely land use scenario in the absence of the REDD+ program (CCBA, 2010). Customary land: land where uses are regulated by customary, unwritten practice, rather than written, codified law (Dunlop, 2009). Customary rights: to lands and resources refers to patterns of long-standing community land and resource usage in accordance with Indigenous Peoples and local communities customary laws, values, customs, and traditions, including seasonal or cyclical use, rather than formal legal title to land and resources issued by the State (Dunlop, 2009). Deforestation: the direct, human induced conversion of forest vegetation to non-forest vegetation. This definition means a reduction in crown cover from above the threshold of what is defined as forest to below this threshold. Deforestation causes change in land cover and in land use. Common changes include: conversion of forests to annual cropland, conversion to perennial plants (oil palm, shrubs), conversion to slash and burn (shifting cultivation) lands, and conversion to urban lands or other human infrastructure (IFCA, 2008). Degradation: long term direct human-induced changes persist in a forest, cause a loss of forest carbon or other values but do not reduce canopy cover below the defined threshold of what is forest. Degradation would represent a measurable, sustained, human induced decrease in carbon stocks, with measured tree cover remaining above the minimum required to be considered forest. The IPCC presents five potential definitions for degradation: 1. A direct human-induced loss of forest values (particularly carbon), likely to be characterized by a reduction of tree crown cover. Routine management from which crown cover will recover within the normal cycle of forest management operations is not included. 2. Changes within the forests that negatively affect the structure or function of the stand and site, and thereby lower the capacity t supply products and/ or services. 3. Direct human-induced activity that leads to a long term reduction in forest carbon stocks 4. The long term reduction of the overall potential supply of benefits from the forest, which includes carbon, wood, biodiversity, and any other product or service. 5. The overuse or poor management of forests that leads to long term reduced biomass density (carbon stocks) (IFCA, 2008). 144

Decentralization: the transfer of both decision-making authority and payment responsibility to lower level of government. Although still involving the government, it provides a stronger role for local bodies, which are presumed to have greater accountability to the local populace, including both users of the resources and others who live in the area (Sterner, 2002). Effectiveness: defined as the extent to which the emissions reductions and other goals of the program are achieved (CCBA, 2010) Efficient: defined as achieving the target with minimum cost, effort and time (CCBA, 2010). Emissions trading: a provision of the Kyoto Protocol that allows Annex 1 countries to trade emissions reduction credits in order to comply with their Kyoto assigned targets. This system allows countries to pay and take credit for emissions reduction projects in developing countries where the costs of these projects may be lower, thus ensuring that overall emissions are lessened in the most cost-elective manner (IFCA, 2008). Equity and equitable: defined as just, impartial and fair to all parties (CCBA, 2010) Forest: all land with woody vegetation consistent with national standards for canopy cover, canopy height and area. It also includes vegetation that could potentially reach, the threshold values used by a country to define the forest. Forest includes lands covered with mixed species natural forests and plantations of single species for A/R CDM (UNFCCC in IFCA, 2008). A forest is defined as a minimum area of land of 0.05-1 hectares with tree crown cover (or equivalent stocking level) of more than 10-30 percent with trees with the potential to reach a minimum height of 2-5 metres at maturity in situ. Actual definitions can vary from country to country as the Kyoto Protocol permits countries to specify the precise definition within these parameters to be used for national accounting of emissions. Forest land: a category that includes all land with woody vegetation consistent with thresholds used to define Forest Land in the national greenhouse gas inventory. It also includes systems with a vegetation structure that does not, but in situ could potentially reach, the threshold values used by a country to define the Forest Land category. For the purpose of the Kyoto Protocol, it was determined through the Marrakech Accords that Parties should select a single value of crown area, tree height and area to define forests within their national boundaries. Selection must be form within the following ranges, with the understanding that young stands that have not yet reached the necessary cover or height are included as forest: 1. Forest area: 0.05 to 1 ha (Indonesia decided on 0.25 ha) 2. Potential to reach a minimum height at maturity in situ of 2 -5 m (Indonesia decided on 5 m) 3. Tree crown cover (or equivalent stocking level): 10 to 30% (Indonesia decided on > 30%) Under this definition a forest can contain anything form 10% to 100% tree cover, it is only when cover falls below the minimum crown cover that is designated as non-forest. However, if this is only a temporary change, such as for timber harvest with regeneration expected, the land remains in the forest classification (IFCA, 2008). Forest management: A system of practices for stewardship and use of forest land aimed at fulfilling relevant ecological (including biological diversity), economic and social functions of the forest in sustainable manner (IFCA, 2008). Forest dependent people: People who live in forests or in rural areas close to forests, including customary and indigenous peoples. Also referred to as local communities for the purposes of this study (Dunlop, 2009) Fungible: Being of such a nature that one part or quantity may be replaced by another equal part or quantity in the satisfaction of an obligation. Oil, wheat, and lumber are fungible commodities. Throughout this book we refer to the fungibility of a tonne of carbon dioxide equivalent (CO2e).

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Good governance: includes accessibility, peoples participation, transparency, accountability, rule of law, predictability, justice and sustainability (CCBA, 2010) Holding: all land held by a household or person, whether owned, leased, or held on some other basis. Kyoto Protocol: an international treaty that requires participating countries to reduce their emissions by 5 percent below 1990 levels by 2012. The protocol, developed in 1997, is administered by the Secretariat of the UN Framework Convention on Climate Change (IFCA, 2008). Marginalized people or groups: those that normally have little or no influence over decisionmaking processes. Marginalization may be related to gender, ethnicity, socio economic status and/or religion (CCBA, 2010). Masyarakat adat: translated variously as customary communities, traditional communities, or indigenous peoples. AMAN (Aliansi Masyarakat Adat Nusantara- Alliance on Customary Communities) defines adat communities as people who live in their ancestral teriitory, excert soverignty over their land and natural resources and govern their community by customary laws and institutions which sustain the continuity of their livelihood. General characteristics of adat communities include: Self-inditification and identification by others as being part of a distinct social or cultural group The display of a desire to preserve that cultural identity Social, cultural, economic, and political traditions and institutions distinct from the dominant culture Economic systems oriented more toward traditional menas of production Unique ties to traditional habitats and ancestral territories, and to the natural resources in these habitats and territories Shared values and netweorks of relationships, embedded in local social structures Self governing or at least use of traditional local institutions and processes of deliberation (mufakat) and concensus (musyawarah) for decision making and dispute resolution (Dunlop, 2009) Mortgage: a contract that commits land as security for a loan. Normally, the land remains with mortgagor until that person fails to repay the debt. Under posessory mortgage, the lender takes possesion of the land as soon as the mortgage is made and holds it until the debt is repaid (Bruce, 1998). MRV: measure gains from baseline in CO2-e supported by data from GHGs inventory and institutional building. MRV involves all emission reduction from all activities (FORDA and ITTO, 2010). Mufakat: discussion to reach an agreement. Part of customary decision making in Indonesia (Dunlop, 2009) Musyawarah: A customary process of deliberation and discussion to resolve village level disputes (Dunlop, 2009) Parcel: a unit of land legally defined bu its acquisition as a single contigous area of land under a uniform cropping pattern with no legal implication. Parcels can be broken into smaller pices. This process, which may occur at inheritance by division among heirs or by sale of part of the parcel, is called partition or subdivision. Fragmentation exists when a holding consists of several separate parcels (Bruce, 1998). Reference Emission Level (REL): baseline against which reductions in emissions are measured. It is a function of forest area change combined with the corresponding carbon stocks of the forests being deforested or degraded. A REL may be established by (i) taking an average of past conditions over an agreed time frame; (ii) modelling based on unplanned (unsanctioned) activities and planned land use to

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meet development goals over a specified time frame, or a mixed REL where emissions from planned and unplanned drivers of deforestation and degradation are considered differently and separately. Emissions from unplanned activities are measured against a REL based on historical unplanned emissions, or an average of historical emissions (IFCA, 2008). Rights holders: those whose rights are potentially affected by the REDD+ program and stakeholders are those whose interests are potentially affected by the program (CCBA, 2010). Reforestation: the direct human-induced conversion of non-forested land to forested land through planting, seeding and/or the human-induced promotion of natural seed sources, on land that was forested but that has been converted to non-forested land. For the first commitment period, reforestation activities will be limited to reforestation occurring on those lands that did not contain forest on 31 December 1989 (UNFCCC, 2008). Sequestration: The process of increasing the carbon content of a carbon pool other than the atmosphere (UNFCCC, 2008). Carbon sequestration refers to the absorption from the atmosphere of carbon dioxide by vegetation and soils and the storage of carbon in vegetation and soils (Hepburn, 2008) Sink: Any process or mechanism which removes a greenhouse gas, an aerosol, or a precursor of a greenhouse gas from the atmosphere. A given pool (reservoir) can be a sink for atmospheric carbon if, during a given time interval, more carbon is flowing into it than is flowing out (IPCC, 2000). Stakeholders: the public, including individuals, groups, or communities elected, or likely to be elected, by the proposed project activity or actions leading to the implementation of such an activity (IFCA, 2008). Validation: the assessment of a projects Project Design Document, which describes its design including its baseline and monitoring plan, by an independent third party, before the implementation of project against the requirements of a specific standard (IFCA, 2008). Verification: refers to the collection of activities and procedures that can be followed during the planning and development, or after completion of an inventory that can help to establish its reliability for the intended applications of that inventory. Typically, methods external to the inventory are used to check the truth of the inventory, including comparisons with estimates made by other bodies or with emission and uptake measurements determined from atmospheric concentrations or concentration gradients of these gases (IFCA, 2008). Verification also means provides an independent third party assessment of the expected or actual emission reductions of a particular abatement project (IFCA, 2008). Verified or Voluntary Emissions Reductions (VERs): reductions that, unlike CERs, are sold on the voluntary market. VERs is linked neither to the Kyoto Protocol nor to the EU ETS. VERs is sometimes referred to as Voluntary Emissions Reductions. Voluntary market: the non-regulated market for carbon credits (especially VERs) that operateds independently from Kyoto and the EU ETS (IFCA, 2008) Voluntary offsetting: offsetting purchases made by individuals, businesses, and institutions that are not legally mandated (IFCA, 2008). Vulnerable people or groups: those lacking secure access to the assers in which secure livelihoods are built (social, cultutal, human, financial, natural, physical and political) and/or having high exposure to external stresses and shocks, including climate change, that may affect these assets and peoples ability to use these assets. Forest dependency may be an important factor affecting vulnerability particularly where the REDD+ program itself may change access to forest resources. In many situations marginalization exacerbates vulnerability e.g. marginalization gender (CCBA, 2010)

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Annex 2 Questionnaire
Questionnaire Carbon Legal System for the Implementation of Forest Carbon Scheme on REDD Projects in Indonesia: Will it secure property right?
Date: Indonesia is a high forest cover country that also has high rate of deforestation and forest degradation. Because of this situation, Indonesia is actively exploring the opportunity to benefit from the emerging REDD (Reduction Emission from Deforestation and Forest Degradation in developing countries) scheme. Objective of questionnaire The purpose of the study is to better understand the linkages between land, forest, and carbon tenure systems in Indonesia. In particular, I am interested to see how REDD could influence the resolution of land tenure issues. I will also compare the Indonesia case with other international experiences (e.g., Australia) to analyze alternative options to adjust/reform the current system to be more fit to develop and implement a REDD scheme in Indonesia. Therefore, please answer the following answer carefully. For filling all of the questions, you will need about 30 minutes. Your information is crucial to better understand the legal, policy, and property right security implications of carbon rights on REDD in Indonesia. The information provided will be treated confidentially and will only be presented in a summary form (there will be no mention of individual project data). The whole results of this study will be shared with you.

Thank you in advance for your participation . Questions Situation 1. General question: what are the objectives of the project, main components, and what are the main challenges in achieving these objectives, in general? 2. What type of tenure system is in place in the project site? (Ownership, management, management responsibilities, main actors: state, indigenous, communities, private, etc) and what type of agreements are in place? 3. Can the community access some forest resources for their use from REDD project site?

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4. Do the local communities have customary use rights in the project site and if so, are these rights in some way officially recognized? 5. Are there conflicts or disputes between stakeholders due to tenure issues, and if so, are there any mechanisms for conflict management in place? Design (Process) 6. Who takes part in the processes to design the REDD scheme? How are these actors involved in the various phases? 7. Do you think that customary tenure system can affect the implementation of REDD schemes and how? Benefit sharing 8. What are the processes or regulations that specify how benefits will be shared (e.g. laws, regulations, environmental service license - IUPJL)? 9. Who are the potential beneficiaries and what are the conditions to access benefit sharing (e.g. titles, etc)? 10. What happens if there are competing rights (customary vs. statutory)? 11. Do you expect that tenure situation (e.g. competing customary rights) will influence your benefit sharing arrangements, and how? Tenure impacts 12. Do you think that the implementation of REDD mechanisms in Indonesia may trigger or influence any sort of tenure reform? is this happening and if so in which way? 13. Does Indonesia recognize carbon rights as different from rights to land or trees? a. if different, how will carbon rights be allocated? 14. How do you plan to address these issues with multiple claims to carbon, tree, and land rights? if you have any documentation that contains information that address some of these questions, I would appreciate if you could share these documents with me as well.

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Annex 3 Community tenure security assessment

No. 1 Element of community tenure security Effective internal institution a. strongly influenced by a community's capacity to define and implement its own rules Case study 1 (Aceh) a. community based tenure system involves a mixture of communal and individual property rights. Village leaders play a key role in the administration of adat land rights. Communities identified the Keucik as key authority in relation to land administration. The Imeum Mukim, Tuha Lapan and Tuha Peut were also noted as being involved in land administration matters, especially where musyawarah or dispute resolution is necessary (Dunlop, 2009) b.Acehnese custom distinguish between: (i) ownership rights and use rights; (ii) permanent community land (owned collectively by the community and intended to be held in trust for future generations.Use rights to permanent community land may be granted to community members for a specific period of time then land must be returned to the community) and free community land (still under community authority, can be granted to community members for long term use and ownership (Dunlop, 2009) Case study 5 (Papua) a. Six ethnic groups probably have customary land rights to the land within the REDD proposed areas: Orya (dominant), Elseng, Kaure, Sause, Gresi, andn Nimboran (just a few) (WWF, 2009) Australia a. communal title is formally vested in Aboriginal Land Trusts comprised of Aboriginal people who hold the title for the benefit of all the traditional landowner (Central Land Council, 2010)

b. often consensus -based and guided by assemblies that represent households, or diminated by local chief or specialized subcommities of elders or forest users

b. Local communities who lived surrounding the forest in Papua have felt strongly that they are the right owners of the lands and forests within their adat boundaries despite the fact that their rights are not acknowledged by the state. Most private companies in Papua could not extract time or gain access to their forest concession without obtaining an "informal permission" from the respective adat leaders and adat community who claim the land as their own (WWF, 2009)

b. the Indigenous laws continue to operate regardless of the intrusions of Australian law.It continues to allocate rights and interests in country, dictate the nature of social interactions and acts as the basis of Indigenous social, cultural and political identity. The implications for land management, extinguishment and subsequent compensation is that acts which serve to extinguish the recognition of native title only really operate to extinguish recognition in the domain of Australian law. That is, a grant of an interest or a right under Australian law, which wipes

out the recognition of native title over that land, may not necessarily do so under Indigenous law (Sheehan, 2001) c. success is indicated by the degree to which community rules and resource boundaries are accpeted as legitimate , are clear cut and enforced, and by whether communities can practice exclusive, adapt to new situations and deal effectively with external forces, particularly the government c. Adat land right can be acquired through pusaka (inheritance), penghibahan (gifting), publoue (selling, gantoue penunayah (compensation), peugala (pawning), mawaih (sharecropping) and peuwakeuh (grant of wakaf land) (Dunlop, 2009) c. Three major types of land tenure ownership system: (i) ethnic clan (marga) ownership rights. All member of clan have the rights to utilize the land and natural resources within their clan's land boundaries ;(ii) tenure land right system falls under the control of the Ondoafi (the chief of the ethnic clan). Access to the land owned by Ondoafi is only possible with his permission; (iii) individual ownership rights over land that often are used for farming or other purposes. This type of ownesrhip over land is held by the male lineage (by the husband or by brother from the husband side or by the oldest son in the family) (WWF, 2009) d. Ondoafi seems to have freedom to rule the clan. Great Ondoafi does not have the right to intervene in a decision made by other Ondoafi. Ondoafi give permissions to anyone who needs access to land and natural resources within adat jurisdiction (WWF, 2009) c. Aboriginal legal systems are inextricably linked with religion. Aboriginal societies tend not to divide the spiritual and the temporal in the way that societies (Sheehan, 2001)

d. the effectiveness can be measured by their efectiveness in handling internal disputes, (over who gets to make the rules, and disputes regarding interaction with the government and outsiders)

d. only members of the local community can acquire ownership rights to village land . Outsider maybe granted use rights following a decision by community leaders and payment of compensation which depends on the size of the land (Dunlop, 2009)

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e. where customary systems interact with formal state systems, security is affected by the degree to which a community acts in a coherent and organized manner and by the degree to which the state recognized the legitimacy of local rules and enforcement

e. use rights over permanent community land or free community land under adat authority are granted following a process of public notification in which the prospective rights-holder shows a sign of intention to cultivate (tanda dong tanoh in Acehnese). Three to six months after making sign of intention to cultivate, the candidate can report to the village leader for a decision. If there is another claimant to the land, the sign must be removed and a musyawarah is undertaken to decide who has the right to the land. If there are no other claimant to the land, the Keucik can grant use rights to the applicant (Dunlop, 2009) f. there are 3 customary institutions which operate with the Mukim that have rimary role in relation to forests: Peutua Seunubok, Panglima Uteun, and Kejreun Blang (Dunlop, 2009).

e. Other information regarding traditional tenure system : (i)women practically do not have rights to own land but they have usefruct rights by obtaining permission from their male relatives; (ii) people who have recently migrated to a village can be granted access to use land by cheif of clan for building houses or farming, but no rights to transfer land to other parties; (iii) the concept of selling and buying land is not common practice in these communities, although very few exceptions of selling land exist where the land owner sold his land to a private company or govt institution (WWF, 2009) f. checks and balances in adat institutions seem very weak. Some members in the community, in particular women, are considered to have no rights to participate in adat decision making process, let alone in her husband's clan. To develop REDD mechanism, this situation could create problems as the success of the project to control deforestation and forest degradation will depend on whether members of the adat communities participate and feel their concerns are bing accomodated. REDD project would also need to ensure that the future

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financial benefits generated would flow equally to the members of adat communities and not just to a few elites (WWF, 2009) g. The majority of intra community and inter community disputes in villages are resolved through village concensus (musyawarah) which invloves a process of discussion, negotiation and agreement. According to the community, disputes are usually resolved at the first customary meeting which is attended by the Keucik, Mukim, Tuha Peut, Imeum Mesjid, and Petua Seunubok as well as disputing parties. If the dispute is not resolved ate the first meeting a second meeting is held which is attended by the same village leaders who attend the first meeting as well as the Camat (subdistrict head) (Dunlop, 2009) 2 Legal recognition and support a. it is necessary for the state law to recognize local ownership and access rights and to identify those with rights to speak for communities a. the government's perspective of the boundary delineation process is not always consistent with that of local village leaders. According to custom, forest without specific owner is customary forest as it is managed collectively by the community.Whatever land that was not cultivated by the community would later be allocated to other community members or from other villages outside the area. However, this initiative did not come to fruition because it was not a. Special Forest Law for Papua improves the rights of the indigenous people over land and forest. The article number 5 stipulates that: " the Adat Community in Papua Province has the ownership rights over forest in their own customary land boundaries. The article no. 6 further stipulates Government of Papua still has the authority to regulate the management and utilization of the forests that are a. Aboriginal Land Rights (Northern Territory) Act 1976 was a significant step in legally acknowledging Aboriginal rights to land and has helped pave the way for Indigenous peoples around the country getting back rights to their traditional lands (Reconciliation Australia, 2009 Central Land Council, 2010)

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b. legal framework should be designed as enabling tools . With regard to community property, laws should recognize ownership, but then reflect customary rules and provide legal space for locally defined regimes within that ownership

supported by the provincial government (Dunlop, 2009) b. ordinary community members often feel excluded from the process of drawing forest boundaries. They saw the boundaries as a product of unilateral decision-making by the State in relation to forest dependent communities and a continuation of colonial policies about forest areas. This shows that even when State law is understood it is seen as a to-down process and is thus treated with indifference or disregarded (Dunlop, 2009)

c. Important that legal frameworks give equal support to private community rights and private individual property, a "leveled playing field"

c. there has been a weakening of the role of these adat institutions in the management of the forest due to the centralized legal structure of the New Order Era, the conflict which removed people from the forest area, current distortion of customary values and lack of regulatory clarity. Additionaly, there is a lack of clarity in relation to forest boundaries for adat forest which often do not match up with official government boundaries (Dunlop, 2009)

owned by the indigenous Papua (WWF, 2009) b. Special Forest Law for Papua still has a number of unresolved issues concerning : (i)restrict local rights where private sectors hold a valid forest use permits granted by Ministry of Forestry; (ii) the status of past forest use permits that are still valid in the hand of private sectors. Tensions might increase if there is no effort to resolve the current conflict over land rights claims that have emerged between private sector, government and local communities; (iii) local communities must use and manage their forest resources sustainability therefore puts some limits on cumminities to exercise their rights in order to prevent unsustainable use practices by communities (WWF, 2009) c. The special autonomy legislation, Law no.21/2001, outlines an independent governance structure of the Papua People's Council (MRP), an indigenous/ local legislative and judical system, and rights over management of natural resources. Unfortunately the implementation of this special autonomy law is marred by percieved central government indecision, leading to the creation of new provinced

b. Native Land Title Act, adopted in 1990s give greater recognition to existing institutional forms, providing very basic requirements and guidelines but leaving the details of internal group functioning to the group itself (Fingleton, 1998 cited in Lindsay, 1999)

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through another law that many Papuans see as having weakened their position both politically and economically (Latumahina and Chapin, 2006) d. lack of coherence between adat laws in relation to forest management and the national forestry and agararian laws. e. Law on the Governance of Aceh (UUPA 11/ 2006) provides special autonomy over the use and allocation of benefits from natural resource management and formally recognizes the position of the mukim in local governanve. The new provincial Government has moved strongly towards the recognition of customary forest resource rights and lands and legal basis for equitable benefit sharing. This process has begun predominantly in Aceh Jaya District (Rafli et al., 2007) f. Governor's decree of October 31, 2007 number 522.1/534/2007 commits a forestry re-design team to work towards predicting how existing land tenure will be allocated or designed before the end of 2008 (Smartwood, 2008) g.In terms of participatory forest management process, Quanon no. 4/ 2003 establishes Mukim as legitimate stakeholders with defined roles in forest management (Rafli et al., 2007)

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Regulations, regulatory mechanisms and institutions a. official manifestations of rights such as property surveys and titles, can enhance tenure security and are increasingly important for communities that are enaganged in modern markets and formal financial systems

x a. Majority of landowners in communties around the Ulu Masen Ecosystem do not have Land title certificates from the National Land Agency (BPN)(Dunlop, 2009). No land maps identifying geographic areas of customary authority (IDLO, 2009)

b. Formal ajudication and title registry has taken place in the absence of understanding complex natural resources or in the presence of competing claims, well intentined surveys and titles have not only failed to deliver tenure security, they actually have increased the level of conflicts

b. Most land owners do have local forms of land documentation such as Surat Keterangan Hak Milik (Letter of Evidence of Ownership Right) signed by the Keucik or Camat (sub-district head). Some community members have no documentation whatsoever to land that they consider is legitimately under their ownership (Dunlop, 2009)

a. designated of integrated Forest Management Units (KPH) is a priority for the Ministry of Forestry under the current administration. Papuan stakeholders have seized this as an opportunity to secure management space for local communities, and to clarify ruled of the game of addressing the overlaps between community and other (commercial and conservation) interests (Latumahina and Chapin, 2006) b. Provincial Forest Department is promoting the development of enabling legislation which mandates the mapping of customary territories. It also establishes mechanism for customary authorities to work wirh government in determining (1) areas that must be aside for longterm community management, as well as (2) areas suitable for large scale investment. This reflects the fact that many rural Papuans do in fact want to do business with investors, but that, as customary land owners, they wish to reserve the right of first refusal (Kayoi, 2006)

a. government protect people's interests in land by giving legal tenure to the land through Acts of parliament. Community owns the land as inalienable freehold title (could not be acquired, sold, mortgaged or disposed and title should be communal) (Reconcilliacion Australia, 2009)

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c. Use rights are documented through a "Letter of Evidence of Permission to Cultivate (Surat Keterangan Izin Garap or Surat Garap ) granted by Keucik. While communities noted that Surat Keterangan Izin Garap can be used to resolve disputes through village justice system, they also noted their main limitation that they can not be used for more formal purposes such as rising a mortgage over land (Dunlop, 2009) d. Customary land boundaries are often identified through traditional of demarcation (for example rivers, gorges, large trees, valleys, etc.) (IDLO, 2009) 4 Indipendent arbitration or judiciary means a. presence of independent third party to sift through local claims for various products and resources a. FFI has been initiated participatory land use planning process, establishing jointly agreed boundaries and land use patterns, and developing muti-satekholder management structure by involving communities and Mukim leaders for avoiding conflicts of forest resources. This process has been completed in the district of Aceh Jaya and the resulting spatial is in the final public consultation process before being approved by district parliament (Rafli et al., 2007)

c. Lands are owned by communal and majority of landownners do not have land title certificate from BPN (Takege, 2001)

a. WWF Indonesia has conducted community mapping activities in three villages -Beneik, Garusam and Guriad to show the voundaries of their adat (customary) lands, while the rest of areas have yet to be mapped (WWF, 2009)

a. activist-oriented public interest lawyers have been key players behind legal actions to provide communities with tenure security (White, 2004)

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b. This can be legal system of customary justice, independent courts, a once-removed arm of local government, or an independent artbitrator of some kind

b. the maps have informed and influenced the development of legal and institutional mechanism for recognizing adat territory and re-classifying forest land in ways that better accommodate adat ownership and management system in Papua (Latumahina, 2006)

c. The idependent third party must have the skill to come up with locally acceptable solutions to disputes, and decisions must be accepted as legitimate by the state Political constituency for community rights a. additional legal, policy and administrative asistance is usually necessary, even if legal recognition has been secured and lands have been demarcated and registered

x a.land ownership records between different levels of government (village, sub-dictrict, provincial, national) are often inconsistent(IDLO, 2009)

x a. Unclear land ownership status ( no land title for communal land ) (Tekege, 2001)

a. Aboriginal councils and associations act of 1976 establishing legal forms for indigenous groups to hold native titles, to allow indigenous groups to develop legally recognizable bodies which reflect (Aboriginal people's own culture and do not require them to subjugate this culture to overriding Western European legal concepts (Lindsay,1999)

b. local communities and their advocates need a sophisticated understanding of law and the political landscape, along with the ability to lobby and otherwise effectively defend their rights.

b. Unclear land ownership status (uncertainty over who owns a particular area of land- government, company or individual) (IDLO, 2009)

b. local communities don't have understanding of law and even cannot defend their right from land encroachment by government (Tekege, 2001)

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c.communities have limited information about land/ forest boundaries and the status of forest (IDLO, 2009) d. customary communities have difficulty accessing new areas of land (IDLO, 2009) e. low level of involvement of communities in the process of forest management led by government including in decision about the issuing of HGU,HPH, and HTI (IDLO, 2009) f. community access to forests is restricted by government authorities responsible for managing the ecosystem (IDLO, 2009) Note: x clear no unclear

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