Ministry of Finance Prepares Regulations on Profit Sharing Fund for Palm Oil

The government is harmonizing the Draft Regulation of the Minister of Finance (“Draft Regulation”) on the Management of Profit Sharing Fund (“DBH”) for Palm Oil Plantation. This regulation was drafted as an implementation of the provisions of Article 16 of Regulation of the Government No. 38 of 2023 on DBH for Palm Oil Plantation (“Regulation 38/2023”), and is planned to replace Regulation of the Minister of Finance No. 91 of 2023 on the Management of Profit Sharing Fund for Palm Oil Plantation (“Regulation 91/2023”).

“The management of DBH for Palm Oil Plantation will be aligned with the dynamics of regional transfer fund management (“TKD”), which is targeted for this year,” said Hukumonline internal source in the Directorate-General of Fiscal Balance (“DJPK”) the Ministry of Finance.

Furthermore, this fiscal instrument also regulates a performance-based regional allocation mechanism, which includes indicators of poverty reduction and the availability of regional action plans for sustainable palm oil. Additionally, the Draft Regulation contains provisions on the use of DBH for Palm Oil Plantation for road infrastructure development and various other activities such as data collection on smallholder oil palm plantations, Indonesian Sustainable Palm Oil (“ISPO”) certificate, forest and land rehabilitation, and social protection for oil palm plantation workers.