Thursday, 26 June 2008

Forestry company denies affiliation with Riau Andalan

Forestry company denies affiliation with Riau Andalan

The Jakarta Post , Jakarta Thu, 06/26/2008

An executive in the legal department of PT Persada Karya Sejati (PKS), based in Pelalawan regency, Riau province, has told the Corruption Court that her company is not affiliated with PT Riau Andalan Pulp and Paper (RAPP).

"They are independently separate companies but are engaged in business contracts related to the development of pulp plantations and the supply of wood," Paulina testified during the trial of Pelalawan Regent Tengku Azmun Jaafar on Tuesday.

Azmun is facing charges of illegally issuing authorization letters to 15 companies for the utilization of 120,000 hectares of forest in the regency between 2002 and 2003.

Paulina countered the testimony of another witness, former Pelalawan forestry office employee Hambali, who told an earlier court session that PKS had acquired several companies in Pelalawan that owned forest utilization and pulp plantation development licenses.

Hambali told the court two weeks ago the PKS was really a unit of RAPP, one of the country's largest pulp and paper producers in Indonesia.
Paulina said that legally PKS and RAPP are not affiliated, "but my company (PKS) supplied RAPP with pulp materials under ordinary business contracts".

PKS, she added, did business not only with RAPP but also supplied pulp and timber to other companies in Pelalawan.

Corruption Eradication Commission prosecutors said seven of the forest-based companies acquired by the PKS had been set up by Regent Azmun's relatives and cronies to obtain forest utilization licenses.

Prosecutors accuse Azmun of receiving more than Rp 19 billion (US$2 million) from the companies to which he issued forest utilization permits.