How Does PERMENPUPR 3/2023 Structure Water Resource Permits?

1.0 Introduction and Regulatory Context

The Ministry of Public Works and Public Housing (PUPR) issued Regulation Number 3 of 2023 ("Peraturan Menteri Pekerjaan Umum dan Perumahan Rakyat Republik Indonesia Nomor 3 Tahun 2023 tentang Penataan Perizinan dan Persetujuan Bidang Sumber Daya Air" / Minister of Public Works and Public Housing Regulation Number 3 of 2023 on Water Resource Permits and Approvals) on February 13, 2023, with an effective date of February 24, 2023. This regulation establishes a comprehensive framework for regularizing water resource activities that were conducted prior to obtaining formal permits or approvals, representing a significant policy shift toward accommodating economic development while ensuring legal compliance in water resource management.

The regulation emerges from the government's commitment to advancing national welfare through strategic support for business and economic activities, particularly under the omnibus law framework addressing job creation (cipta kerja), ease of doing business, sustainable investment, and micro, small, and medium enterprise (MSME) empowerment. PERMENPUPR 3/2023 specifically targets individuals and businesses who have utilized water resources without proper authorization, providing a structured pathway to legalize their activities within defined criteria and timeframes. This approach balances developmental imperatives with environmental protection and legal certainty.

PERMENPUPR 3/2023 implements provisions from Government Regulation Number 121 of 2015 on Water Resource Exploitation and Presidential Regulation Number 27 of 2020 on the Ministry of Public Works and Public Housing, positioning this ministerial regulation within Indonesia's broader water governance architecture. The regulation applies exclusively to river basins under central government authority, with the Minister of PUPR exercising permitting authority through the Directorate General of Water Resources. This centralized approach ensures consistent standards across strategically significant water resources.

The regulation establishes three primary permit/approval categories: Water Resource Exploitation Permits (Izin Pengusahaan Sumber Daya Air) for commercial activities, Water Resource Utilization Approvals (Persetujuan Penggunaan Sumber Daya Air) for non-commercial uses, and River Course Alteration Approvals (Persetujuan Pengalihan Alur Sungai). Each category applies to different applicant types and activity purposes, creating a differentiated regulatory framework that recognizes the diverse nature of water resource interactions. Understanding these categorical distinctions is essential for determining applicable compliance pathways.

2.0 Key Definitions and Scope

PERMENPUPR 3/2023 Article 1 establishes thirteen critical definitions that structure the regulation's operational framework. "Sumber Daya Air" (Water Resources) is comprehensively defined as "Air, Sumber Air, dan Daya Air yang terkandung di dalamnya" (Water, Water Sources, and Water Power contained therein), encompassing the physical substance, its containers, and its potential utility. This tripartite definition ensures regulatory coverage extends beyond mere water extraction to include spatial occupation of water sources and harnessing of hydropower potential.

"Air" (Water) means "semua air yang terdapat pada, di atas, ataupun di bawah permukaan tanah, termasuk dalam pengertian ini air permukaan, air tanah, air hujan, dan air laut yang berada di darat" (all water found on, above, or below ground surface, including surface water, groundwater, rainwater, and seawater located on land). This expansive definition captures virtually all water manifestations within terrestrial environments, excluding only marine waters beyond coastal zones. The inclusion of rainwater and coastal seawater demonstrates comprehensive regulatory ambition.

"Sumber Air" (Water Source) refers to "tempat atau wadah Air alami dan/atau buatan yang terdapat pada, di atas, ataupun di bawah permukaan tanah" (natural and/or artificial places or containers of Water found on, above, or below ground surface). This definition encompasses both natural water bodies (rivers, lakes, aquifers) and constructed facilities (reservoirs, canals, wells), recognizing that permits may involve either or both categories. The natural/artificial distinction becomes relevant in determining technical requirements and environmental assessments.

"Daya Air" (Water Power) means "potensi yang terkandung dalam Air permukaan dan/atau pada Sumber Air yang dapat memberikan manfaat ataupun kerugian bagi kehidupan dan penghidupan manusia serta lingkungannya" (potential contained in surface Water and/or in Water Sources that can provide benefits or harms to human life and livelihoods and their environment). This definition acknowledges water's dual character as both resource and hazard, justifying regulatory oversight of activities that harness beneficial potential (hydropower, fisheries) and those that manage harmful potential (flood control, erosion prevention).

The regulation defines "Izin Pengusahaan Sumber Daya Air" (Water Resource Exploitation Permit) as "izin untuk memperoleh dan/atau mengambil Sumber Daya Air permukaan untuk melakukan kegiatan usaha" (permit to obtain and/or extract surface Water Resources to conduct business activities). This permit type applies exclusively to commercial operations, distinguishing profit-oriented water use from governmental, social, or individual non-commercial utilization. The business/non-business distinction fundamentally determines applicable permit pathways and associated compliance burdens.

"Persetujuan Penggunaan Sumber Daya Air" (Water Resource Utilization Approval) is defined as "persetujuan untuk memperoleh dan/atau mengambil Sumber Daya Air permukaan untuk melakukan kegiatan bukan usaha" (approval to obtain and/or extract surface Water Resources to conduct non-business activities). This approval category covers government facilities, social organizations, and individual uses that lack commercial intent. The approval terminology (rather than "permit") suggests a less stringent regulatory regime, though substantive requirements remain substantial.

"Pengalihan Alur Sungai" (River Course Alteration) means "kegiatan mengalihkan alur sungai dengan cara membangun alur sungai baru yang mengakibatkan alur sungai yang dialihkan tidak berfungsi secara permanen" (activity of altering river course by constructing new river channel causing the altered river channel to cease functioning permanently). This definition emphasizes permanence and functional cessation, distinguishing alterations from temporary diversions or partial modifications. River course alteration represents the most environmentally sensitive activity category, triggering the strictest compliance requirements.

3.0 Core Requirements and Provisions

PERMENPUPR 3/2023 Article 2 establishes the regulation's fundamental scope and applicability. Article 2(1) provides: "Penataan perizinan dan persetujuan bidang Sumber Daya Air pada wilayah sungai kewenangan Pemerintah Pusat diselenggarakan oleh Menteri" (Arrangement of permits and approvals in the Water Resources sector in river basins under Central Government authority is conducted by the Minister). This provision centralizes authority exclusively with the PUPR Minister for strategically significant river basins, excluding provincial and regency/municipal waters from this regulation's scope.

Article 2(2) defines the regulation's target population: "Penataan perizinan dan persetujuan bidang Sumber Daya Air sebagaimana dimaksud pada ayat (1) dilakukan untuk kegiatan yang telah dilaksanakan sebelum diterbitkannya izin atau persetujuan" (Arrangement of permits and approvals in the Water Resources sector as referred to in paragraph (1) is conducted for activities already implemented before issuance of permits or approvals). This retrospective application mechanism creates a regularization pathway for previously unauthorized activities, representing a regulatory amnesty with conditions rather than strict enforcement of pre-existing violations.

Article 2(3) temporally limits the regularization window: "Kegiatan yang telah dilaksanakan sebagaimana dimaksud pada ayat (2) merupakan konstruksi yang dilakukan sebelum diundangkannya Peraturan Menteri ini" (Activities already implemented as referred to in paragraph (2) constitute construction conducted before promulgation of this Ministerial Regulation). Only activities completed before February 24, 2023 qualify for the regularization process; subsequent unauthorized activities fall under standard enforcement regimes with penalties. This temporal boundary prevents perpetual retrospective legalization.

Article 2(4) categorizes eligible activities: "Kegiatan sebagaimana dimaksud pada ayat (2) berupa: a. pengusahaan Sumber Daya Air; b. penggunaan Sumber Daya Air; atau c. Pengalihan Alur Sungai" (Activities as referred to in paragraph (2) comprise: a. water resource exploitation; b. water resource utilization; or c. River Course Alteration). This tripartite categorization exhaustively covers commercial extraction, non-commercial use, and permanent channel modifications, ensuring all significant unauthorized water interactions can potentially be regularized under appropriate permit/approval pathways.

Article 3(1) establishes four cumulative criteria for permit/approval eligibility: "Kegiatan yang dapat diberikan izin atau persetujuan harus memenuhi kriteria sebagai berikut: a. laik teknis; b. tidak menimbulkan kerusakan lingkungan dan/atau prasarana Sumber Daya Air; c. memberi manfaat sosial ekonomi; dan d. sesuai dengan rencana tata ruang wilayah" (Activities that can be granted permits or approvals must fulfill the following criteria: a. technically feasible; b. not causing environmental damage and/or Water Resource infrastructure damage; c. providing socioeconomic benefits; and d. conforming with spatial planning). These four criteria function as gate-keeping requirements; failure on any criterion justifies permit denial.

Technical feasibility ("laik teknis") requires that constructed facilities meet engineering standards and operational safety requirements. This assessment examines structural integrity, hydrological appropriateness, and technical sustainability, ensuring facilities will not fail catastrophically or underperform expectations. Technical feasibility verification involves engineering analysis of as-built drawings, site inspections, and potentially load testing or flow modeling depending on facility type and scale.

The environmental protection criterion ("tidak menimbulkan kerusakan lingkungan dan/atau prasarana Sumber Daya Air") prohibits activities causing environmental degradation or damaging existing water infrastructure. Article 3(2) provides conditional relief: "Dalam hal terjadi kerusakan lingkungan dan/atau prasarana Sumber Daya Air sebagaimana dimaksud pada ayat (1) huruf b, izin atau persetujuan diberikan dengan kewajiban melakukan perbaikan atas kerusakan yang terjadi" (In the event environmental damage and/or Water Resource infrastructure damage occurs as referred to in paragraph (1) letter b, permits or approvals are granted with obligation to conduct repairs for damage that occurred). This provision enables conditional permitting where remediation can restore environmental integrity.

Socioeconomic benefit requirements ("memberi manfaat sosial ekonomi") demand that activities contribute positively to community welfare or economic development. This criterion justifies the regulation's accommodating approach toward unauthorized activities: if they provide employment, essential services, or economic productivity, legalization serves public interest despite initial non-compliance. Applicants must demonstrate tangible benefits through economic analysis, employment data, or community service documentation.

Spatial planning conformity ("sesuai dengan rencana tata ruang wilayah") requires consistency with provincial or regency/municipal spatial plans. Activities located in prohibited zones (conservation areas, hazard-prone zones, protected forests) or conflicting with designated land uses fail this criterion regardless of technical quality or economic benefits. Spatial planning compliance verification involves obtaining certification from spatial planning authorities, which must be submitted with permit applications.

4.0 Implementation Framework and Compliance

The application process follows a structured pathway beginning with submission to the Permitting Service Unit (UPP) within the Directorate General of Water Resources. Article 4(1) establishes: "Permohonan izin untuk kegiatan sebagaimana dimaksud dalam Pasal 2 ayat (4) diajukan kepada Menteri melalui Direktur Jenderal Sumber Daya Air melalui UPP" (Applications for permits for activities as referred to in Article 2 paragraph (4) are submitted to the Minister through the Director General of Water Resources through UPP). The UPP serves as the administrative gateway, receiving applications, checking completeness, and initiating verification processes.

For Water Resource Exploitation Permits, Article 5(1) requires application letters containing: "a. identitas pemohon; b. maksud dan tujuan pengusahaan Sumber Daya Air; c. lokasi pengusahaan Sumber Air dan/atau pengambilan Air; d. jumlah Air dan/atau dimensi ruang pada Sumber Air yang diusahakan; e. jangka waktu yang diperlukan untuk pengusahaan Sumber Daya Air; dan f. jenis prasarana dan teknologi yang digunakan" (a. applicant identity; b. purpose and objectives of Water Resource exploitation; c. location of Water Source exploitation and/or Water extraction; d. quantity of Water and/or spatial dimensions in Water Source exploited; e. timeframe needed for Water Resource exploitation; and f. types of infrastructure and technology used). These content requirements ensure applications provide sufficient information for technical and legal assessment.

Article 5(2) mandates supporting documentation including: "a. gambar teknis (as built drawing) prasarana yang telah terbangun; b. surat keterangan bahwa kegiatan yang dilakukan dan/atau konstruksi yang dibangun sesuai dengan rencana tata ruang wilayah yang dikeluarkan oleh instansi membidangi penataan ruang; c. persetujuan lingkungan; d. surat pernyataan bahwa kegiatan yang dilakukan dan/atau konstruksi yang dibangun tersebut memberi manfaat sosial dan ekonomi dan/atau tidak menimbulkan kerugian pihak lain; e. berita acara konsultasi publik atas pengusahaan Sumber Daya Air; dan f. Surat pernyataan telah membangun konstruksi dan/atau menggunakan Air, Sumber Air, dan/atau Daya Air tanpa izin dan bersedia mengikuti ketentuan sesuai dengan Peraturan Menteri ini" (a. technical drawings (as built drawing) of constructed infrastructure; b. certificate that activities conducted and/or construction built conforms with spatial planning issued by spatial planning authority; c. environmental approval; d. statement letter that activities conducted and/or construction built provides socioeconomic benefits and/or does not cause harm to other parties; e. public consultation minutes on Water Resource exploitation; and f. statement letter acknowledging construction and/or use of Water, Water Sources, and/or Water Power without permit and willingness to follow provisions in accordance with this Ministerial Regulation). These requirements create substantial documentation burdens but ensure comprehensive compliance assessment.

Article 6 establishes expedited procedures for National Strategic Projects. For these priority projects, documentation requirements reduce to only environmental approval and as-built drawings, eliminating spatial planning certificates, socioeconomic benefit statements, public consultation minutes, and acknowledgment statements. This streamlining recognizes that National Strategic Projects have already undergone extensive governmental review and approval at higher policy levels, making duplicative documentation unnecessary. The expedited pathway incentivizes formal project designation as National Strategic Projects.

River Course Alteration applications face the most stringent documentation requirements due to environmental sensitivity. Article 9 mandates applicants provide: "a. peta lokasi sungai yang telah dialihkan alurnya dan ruas sungai baru; b. hitungan luas dan panjang alur sungai yang dialihkan alurnya dan luas dan panjang alur sungai baru; c. sertifikat hak atas tanah untuk ruas sungai baru atas nama pemohon; d. analisis hidrologi dan hidraulika fungsi pengaliran sungai sebelum dan sesudah Pengalihan Alur Sungai melalui pemodelan hidrologi dan hidraulika; e. analisis pengaruh Pengalihan Alur Sungai terhadap muka Air banjir di hilir lokasi pengalihan dan pengaruh penurunan dasar sungai di hulu lokasi pengalihan terhadap kestabilan bangunan yang ada; f. gambar teknis (as built drawing) konstruksi ruas sungai baru; dan g. pernyataan kesanggupan untuk memenuhi ketentuan peraturan perundang-undangan" (a. location map of river with altered course and new river segment; b. calculations of area and length of altered river course and area and length of new river segment; c. land rights certificate for new river segment in applicant's name; d. hydrological and hydraulic analysis of river flow function before and after River Course Alteration through hydrological and hydraulic modeling; e. analysis of River Course Alteration impacts on flood water levels downstream of alteration location and impacts of riverbed lowering upstream of alteration location on stability of existing structures; f. technical drawings (as built drawing) of new river segment construction; and g. statement of willingness to fulfill regulatory provisions). These requirements demand sophisticated hydraulic engineering analysis beyond capabilities of many applicants.

Article 11 imposes additional commitments for River Course Alteration applicants: "a. menyerahkan ruas sungai baru dengan daya tampung minimal sebesar daya tampung sungai yang dialihkan alurnya; b. menyatakan lahan yang dimanfaatkan untuk ruas sungai baru tidak dalam sengketa atau permasalahan hukum serta memiliki alas hak; c. menyerahkan dokumen hak atas tanah pengganti untuk ruas sungai baru atas nama Kementerian Pekerjaan Umum dan Perumahan Rakyat; dan d. menyelesaikan dampak permasalahan sosial akibat Pengalihan Alur Sungai" (a. surrender new river segment with carrying capacity minimally equal to carrying capacity of river whose course was altered; b. declare land utilized for new river segment is not under dispute or legal problems and has legal basis; c. surrender land rights documents for replacement new river segment in the name of Ministry of Public Works and Public Housing; d. resolve social problem impacts resulting from River Course Alteration). These commitments effectively require applicants to donate equivalent or superior river channels to the government, ensuring public hydrological capacity is preserved or enhanced.

Article 13(2)-(3) establish dimensional requirements: "Ruas sungai baru sebagaimana dimaksud pada ayat (1) minimal memiliki luas dan panjang yang sama atau lebih dari ruas sungai yang dialihkan. Dalam hal luas dan panjang sebagaimana dimaksud pada ayat (2) tidak sama atau kurang maka pemohon harus mengubah alur sungai dan/atau memperluas sempadan sungai yang dialihkan" (The new river segment as referred to in paragraph (1) minimally has area and length equal to or greater than the altered river segment. In the event area and length as referred to in paragraph (2) are not equal or are less, then the applicant must modify the river course and/or expand the buffer zone of the altered river). If equivalent dimensions prove impossible, Article 13(5) permits compensation through constructing alternative water infrastructure: "pemohon harus memberikan kompensasi dengan membangun prasarana Sumber Daya Air berupa: a. embung; b. kolam retensi; dan/atau c. tampungan Air lainnya" (applicant must provide compensation by constructing Water Resource infrastructure comprising: a. small reservoir (embung); b. retention pond; and/or c. other water storage). This flexibility prevents dimensional impossibility from blocking permits while preserving hydrological capacity.

5.0 Verification Process and Administrative Sanctions

Upon UPP's determination that applications are complete, Article 14 mandates: "Dalam hal berkas permohonan izin atau persetujuan sebagaimana dimaksud dalam Pasal 4 sampai dengan Pasal 11 telah dinyatakan lengkap oleh UPP, proses permohonan dilanjutkan ke proses Verifikasi" (In the event application files for permits or approvals as referred to in Articles 4 through 11 have been declared complete by UPP, the application process proceeds to Verification process). Verification constitutes the substantive review phase where technical feasibility, environmental compliance, and regulatory conformity undergo rigorous examination by multidisciplinary teams.

Article 15(1) defines Verification scope: "Verifikasi sebagaimana dimaksud dalam Pasal 14, dilakukan melalui pemeriksaan: a. kesesuaian kegiatan yang dilakukan dengan ketentuan peraturan perundang-undangan yang meliputi aspek: 1. lingkungan dan/atau prasarana Sumber Daya Air; 2. manfaat sosial ekonomi; dan 3. rencana tata ruang wilayah; dan b. kelaikan teknis atas konstruksi yang telah terbangun" (Verification as referred to in Article 14 is conducted through examination of: a. conformity of activities conducted with regulatory provisions encompassing aspects of: 1. environment and/or Water Resource infrastructure; 2. socioeconomic benefits; and 3. spatial planning; and b. technical feasibility of constructed facilities). This examination directly assesses the four criteria from Article 3(1), translating abstract requirements into concrete investigative tasks.

Article 15(2)-(3) establish Verification Team composition: "Pemeriksaan sebagaimana dimaksud pada ayat (1) dilakukan oleh Tim Verifikasi yang ditetapkan oleh Direktur Jenderal. Tim Verifikasi sebagaimana dimaksud pada ayat (2) terdiri dari unsur di Direktorat Jenderal Sumber Daya Air yang meliputi: a. unit kerja yang mempunyai tugas di bidang hukum; b. unit kerja yang mempunyai tugas di bidang pembinaan teknik Sumber Daya Air; dan c. unit kerja terkait" (Examination as referred to in paragraph (1) is conducted by Verification Team established by the Director General. Verification Team as referred to in paragraph (2) comprises elements from the Directorate General of Water Resources including: a. work unit with duties in legal affairs; b. work unit with duties in Water Resource technical development; and c. related work units). This multidisciplinary composition ensures legal compliance and technical quality receive expert assessment.

Article 15(4) permits field investigations: "Dalam hal diperlukan, pelaksanaan Verifikasi sebagaimana dimaksud pada ayat (1) dapat dilakukan peninjauan lapangan bersama dengan balai besar wilayah sungai/balai wilayah sungai pada wilayah sungai lintas negara, wilayah sungai lintas provinsi, dan wilayah sungai strategis nasional dan/atau balai teknik terkait" (When necessary, Verification implementation as referred to in paragraph (1) may conduct field reviews together with major river basin centers/river basin centers for transnational river basins, inter-provincial river basins, and national strategic river basins and/or related technical centers). Field investigations enable direct observation of facilities, environmental conditions, and community impacts, supplementing documentary review with empirical evidence.

For River Course Alteration specifically, Article 15(5) mandates flow testing: "Pelaksanaan Verifikasi sebagaimana dimaksud pada ayat (1) untuk kegiatan Pengalihan Alur Sungai dilakukan uji coba aliran Air sungai pada ruas sungai baru bersama dengan balai besar wilayah sungai/balai wilayah sungai pada wilayah sungai lintas negara, wilayah sungai lintas provinsi, dan wilayah sungai strategis nasional dan/atau balai teknik terkait" (Verification implementation as referred to in paragraph (1) for River Course Alteration activities conducts trial river water flow testing in new river segment together with major river basin centers/river basin centers for transnational river basins, inter-provincial river basins, and national strategic river basins and/or related technical centers). Flow testing empirically validates hydraulic modeling predictions, ensuring new channels function as designed under actual hydrological conditions.

Article 16 requires internal compliance review: verification results undergo review by the Directorate General's internal compliance unit to ensure verification procedures were properly followed. This internal quality control prevents procedural errors from invalidating verification outcomes and ensures consistent application of verification standards across different teams and cases. The compliance review examines process fidelity rather than substantive technical or legal merits, which remain the Verification Team's responsibility.

Article 17(3) establishes three possible Verification outcomes: "Rekomendasi sebagaimana dimaksud pada ayat (2) huruf c dapat berupa: a. pemberian izin atau persetujuan dengan sanksi administratif; b. pemberian izin atau persetujuan dengan sanksi administratif dan perbaikan Sumber Air, prasarana Sumber Daya Air, sarana, dan/atau prasarana yang telah dibangun; atau c. penolakan disertai dengan kewajiban untuk melakukan pembongkaran sarana dan/atau prasarana yang telah dibangun serta mengembalikan Sumber Air sesuai dengan kondisi semula" (Recommendations as referred to in paragraph (2) letter c may comprise: a. granting permits or approvals with administrative sanctions; b. granting permits or approvals with administrative sanctions and repair of Water Sources, Water Resource infrastructure, facilities, and/or infrastructure already built; or c. rejection accompanied by obligation to conduct demolition of facilities and/or infrastructure already built and restore Water Sources according to original condition). These outcomes range from conditional approval to complete rejection with restoration requirements.

Article 17(4) specifies grounds for rejection: "Penolakan sebagaimana dimaksud pada ayat (3) huruf c dilakukan dalam hal konstruksi yang telah terbangun: a. tidak laik teknis; b. tidak memberikan manfaat sosial ekonomi; c. tidak sesuai dengan rencana tata ruang wilayah; atau d. dilakukan di lokasi yang dilarang" (Rejection as referred to in paragraph (3) letter c is conducted when constructed facilities: a. are not technically feasible; b. do not provide socioeconomic benefits; c. do not conform with spatial planning; or d. are conducted in prohibited locations). These rejection grounds directly correspond to the four Article 3(1) criteria, creating logical consistency between eligibility standards and verification outcomes. Rejection triggers mandatory demolition and environmental restoration, imposing severe consequences on non-compliant applicants.

Article 18(2)-(3) establish administrative fines: "Sanksi administratif sebagaimana dimaksud pada ayat (1) berupa denda administratif. Denda administratif sebagaimana dimaksud pada ayat (2) wajib disetorkan ke kas negara paling lambat 6 (enam) bulan sejak izin atau persetujuan ditetapkan" (Administrative sanctions as referred to in paragraph (1) comprise administrative fines. Administrative fines as referred to in paragraph (2) must be deposited to state treasury no later than 6 (six) months from permit or approval establishment). These fines penalize unauthorized activity while enabling legalization, balancing enforcement deterrence with economic pragmatism.

The regulation's Annex establishes three fine calculation formulas. For water extraction/use: D = Td × V × J × K where D = fine amount (rupiah), Td = fine rate, V = volume (cubic meters/month for water or kWh/month for hydropower), J = violation period (months from November 1, 2019 until application submission), K = coefficient based on activity type. This formula imposes fines proportional to unauthorized use duration and magnitude, creating stronger disincentives for larger and longer-duration violations.

For construction crossing water sources (bridges, cables, pipes): DML = ((5L) × (L + 2S)) × N × K where DML = fine (rupiah), L = water source width (meters), N = land tax assessment value (NJOP) per square meter, S = buffer zone (meters), K = coefficient. This formula accounts for spatial occupation dimensions and land value, ensuring fines reflect both physical impact and economic context. Higher NJOP areas (urban centers) incur larger fines than rural locations for equivalent facilities.

For River Course Alteration: D = L × N × K where D = fine (rupiah), L = violation area (square meters, including riverbed and buffer zones), N = NJOP of land adjacent to altered river segment, K = coefficient. This simpler formula emphasizes affected area and land value, with coefficients adjusting for alteration characteristics. The regulation specifies using average NJOP when multiple adjacent parcels exist, preventing manipulation through selective valuation.

Article 18(4) and (7) impose permit revocation for non-compliance with fines or required repairs: "Dalam hal sampai dengan jangka waktu sebagaimana dimaksud pada ayat (3) pemegang izin atau persetujuan tidak melunasi denda administratif, izin atau persetujuan yang telah ditetapkan dicabut dan dinyatakan tidak berlaku... Dalam hal sampai dengan jangka waktu sebagaimana dimaksud pada ayat (6) pemegang izin atau persetujuan tidak melakukan perbaikan Sumber Air, prasarana Sumber Daya Air, dan/atau konstruksi yang dibangun, izin atau persetujuan yang telah ditetapkan dicabut dan dinyatakan tidak berlaku" (In the event that by the timeframe as referred to in paragraph (3) the permit or approval holder does not pay the administrative fine, the permit or approval already established is revoked and declared invalid... In the event that by the timeframe as referred to in paragraph (6) the permit or approval holder does not conduct repairs to Water Sources, Water Resource infrastructure, and/or constructed facilities, the permit or approval already established is revoked and declared invalid). These provisions ensure conditional permits cannot be obtained without fulfilling associated obligations.

6.0 Temporal Provisions and Deadlines

Article 22(1) establishes a critical application deadline: "Pengajuan permohonan izin atau persetujuan sebagaimana dimaksud dalam Pasal 2 ayat (2) dilakukan paling lambat 3 (tiga) tahun sejak Peraturan Menteri ini mulai berlaku" (Submission of applications for permits or approvals as referred to in Article 2 paragraph (2) is conducted no later than 3 (three) years from this Ministerial Regulation coming into effect). Since the regulation became effective February 24, 2023, the application window closes February 23, 2026. Activities constructed before February 24, 2023 but not applied for by February 23, 2026 lose regularization eligibility and face standard enforcement.

This three-year window balances competing objectives: providing sufficient time for applicants to prepare complex documentation packages (particularly for River Course Alteration requiring hydraulic modeling and land transfers) while preventing indefinite regularization availability that would undermine prospective compliance incentives. The regulation explicitly anticipates this period will include government-led socialization campaigns educating potential applicants about requirements and procedures, and evaluations assessing regulatory effectiveness and implementation challenges.

Article 21 mandates rapid decision-making: "Keputusan Menteri atau surat Menteri sebagaimana dimaksud dalam Pasal 17 ayat (7) diterbitkan paling lambat 7 (tujuh) hari kerja terhitung sejak laporan hasil Verifikasi diterima oleh Direktur Jenderal" (Ministerial Decision or Ministerial letter as referred to in Article 17 paragraph (7) is issued no later than 7 (seven) working days calculated from verification report received by Director General). This provision prevents administrative delays from frustrating the regularization process, ensuring applicants receive timely decisions following verification completion. The seven-day deadline applies only to decision issuance, not verification itself, which may require extended periods for complex cases involving field investigations and hydraulic testing.

Article 23(1) addresses applications submitted before the regulation's enactment but lacking complete documentation: "Permohonan izin atau persetujuan untuk kegiatan yang telah dilaksanakan sebelum diterbitkannya izin atau persetujuan, yang diajukan sebelum Peraturan Menteri ini diundangkan namun belum memenuhi kelengkapan sebagaimana diatur dalam Pasal 4 sampai dengan Pasal 11 akan diproses setelah melengkapi persyaratan" (Applications for permits or approvals for activities already implemented before permit or approval issuance, submitted before this Ministerial Regulation was promulgated but not yet fulfilling completeness as regulated in Articles 4 through 11, will be processed after completing requirements). This provision prevents applicants who initiated processes under previous regulatory frameworks from being disadvantaged, allowing them to supplement earlier applications with additional documentation now required.

Article 23(2) permits previously rejected applicants to reapply: "Permohonan izin atau persetujuan yang telah ditolak karena melakukan kegiatan sebelum terbitnya izin atau persetujuan dapat mengajukan izin atau persetujuan kembali berdasarkan ketentuan dalam Peraturan Menteri ini" (Applications for permits or approvals already rejected for conducting activities before permit or approval issuance may submit permits or approvals again based on provisions in this Ministerial Regulation). This provision recognizes that prior regulatory frameworks may have lacked regularization mechanisms, treating earlier rejections as non-prejudicial to applications under this more accommodating regime. Reapplications must satisfy all current requirements; prior rejection does not create presumptions of non-compliance under current standards.

The regulation establishes no explicit timeframes for verification duration, potentially creating uncertainty for applicants unable to predict when decisions will be issued. Complex applications requiring field investigations, hydraulic modeling review, and flow testing could reasonably require months or potentially years for thorough verification, particularly if Verification Teams face backlogs or resource constraints. The absence of verification deadlines contrasts with the strict seven-day decision issuance requirement, suggesting the government prioritized thoroughness in technical review over rapid processing.

7.0 Practical Implications and Recommendations

PERMENPUPR 3/2023 creates significant opportunities and obligations for water resource users operating without formal authorization. The three-year application window through February 2026 represents a limited-time regularization opportunity unlikely to be repeated, making timely action imperative for eligible parties. Organizations and individuals with unauthorized water extraction facilities, hydropower installations, or altered river channels should immediately assess their eligibility and begin documentation compilation to avoid losing regularization access.

The substantial documentation requirements, particularly for River Course Alteration applications requiring hydraulic modeling and land transfers, demand considerable technical and financial resources. Small-scale operators may struggle to afford professional engineering services for as-built drawings, hydrological analyses, and environmental approvals. Cooperative approaches where multiple small operators pool resources for shared technical consultants could improve access for resource-constrained applicants, though each must submit individual applications addressing their specific activities.

National Strategic Project designation provides valuable regulatory advantages through expedited documentation requirements. Project proponents should explore whether their activities qualify for National Strategic Project status under Presidential Regulation Number 109 of 2020 or successor regulations. The effort required to secure National Strategic Project designation may be substantially less burdensome than compiling full PERMENPUPR 3/2023 documentation packages, particularly regarding public consultation requirements and socioeconomic benefit demonstrations.

The administrative fine formulas create predictable penalty calculations enabling applicants to forecast financial obligations before applying. Potential applicants should calculate expected fines using the Annex formulas, incorporating actual extraction volumes, construction dimensions, and local NJOP values to determine whether regularization costs justify continued operation or whether facility abandonment presents a more economical option. The six-month payment deadline provides some financial flexibility but requires applicants to budget substantial funds for post-approval fine payment.

The environmental repair requirements in Article 17(3)(b) permit approvals introduce implementation uncertainties. The regulation provides no standards defining satisfactory repairs, potentially creating disputes between permit holders and government inspectors about repair adequacy. Applicants receiving conditional approvals with repair obligations should seek detailed written specifications from Verification Teams during the verification process, obtaining clear metrics for repair acceptance before permits are issued to prevent subsequent compliance conflicts.

River Course Alteration provisions establish particularly demanding requirements including land transfers to the Ministry of PUPR and compensation infrastructure construction where dimensional equivalence proves impossible. These provisions effectively transform private river alterations into public assets, requiring applicants to donate replacement channels or construct embung/retention ponds benefiting broader communities. Potential applicants should carefully evaluate whether economic benefits from altered rivers justify these substantial public infrastructure contributions, particularly where compensation requirements may exceed original project costs.

The regulation contains no provisions for permit term extensions or renewals, creating uncertainty about post-permit operations. Once authorized periods expire, permit holders presumably must apply for new permits under then-applicable regulations, which may impose different standards. Applicants should request maximum feasible permit terms during initial applications to defer renewal uncertainties, though excessively long terms may face scrutiny regarding appropriateness of projections and commitments.

The absence of explicit appeal mechanisms represents a significant procedural gap. Article 17(4) permits rejections but provides no administrative recourse for applicants disputing verification conclusions or rejection grounds. Rejected applicants presumably must resort to administrative courts under Law 5/1986 on State Administrative Courts, introducing delay, expense, and uncertainty. This gap incentivizes comprehensive initial applications with robust technical documentation minimizing rejection risks, as post-rejection remedies offer limited practical value given regularization deadline pressures.

Provincial and regency/municipal authorities retain permitting jurisdiction over river basins not under central government authority, meaning PERMENPUPR 3/2023 applies only to strategically significant rivers. Applicants uncertain about jurisdictional classification should consult with local Water Resource Management Offices (Dinas Pengelolaan Sumber Daya Air) or river basin centers (Balai Besar Wilayah Sungai/Balai Wilayah Sungai) to determine applicable permitting regimes before investing resources in potentially misdirected applications.

The regulation's implementation success depends substantially on government capacity to process potentially thousands of applications within compressed timeframes. Inadequate UPP staffing, insufficient Verification Team resources, or backlogs at river basin centers conducting field investigations could create processing delays threatening the February 2026 application deadline's effectiveness. Applicants should submit applications early in the three-year window rather than approaching the deadline, allowing time to address document deficiencies or verification requests without time pressure.

8.0 Conclusion

PERMENPUPR 3/2023 establishes a comprehensive regulatory framework balancing economic development imperatives with environmental protection and legal compliance in water resource management. The regulation's retrospective legalization approach acknowledges widespread unauthorized water use while imposing substantial compliance requirements including technical feasibility demonstrations, environmental approvals, spatial planning conformity, and administrative fines calculated based on violation magnitude and duration. This balanced approach enables productive economic activities to continue under legal authorization while deterring future unauthorized development through credible penalty threats.

The regulation's three-year application window through February 2026 creates urgency for potential applicants to assess eligibility, compile documentation, and submit applications before losing regularization access permanently. The complexity of required documentation, particularly for River Course Alteration involving hydraulic modeling, land transfers, and compensation infrastructure, demands early engagement with technical consultants and government agencies to ensure timely compliance. Applicants should prioritize thorough initial applications over rapid submission, as rejection requires starting anew with no guarantee of different outcomes.

Understanding the regulation's differentiated permit/approval categories, verification procedures, and administrative sanction mechanisms enables water resource users to navigate compliance pathways effectively. The structured analytical framework presented in this article, including definitional clarification, criteria assessment matrices, documentation requirement tables, verification process flowcharts, and temporal deadline summaries, provides comprehensive guidance for regulators, applicants, and legal practitioners implementing PERMENPUPR 3/2023 across Indonesia's water resource management sector.

Official Source: Permen PUPR No. 3 Tahun 2023 - BPK RI

Disclaimer

This article was AI-generated under an experimental legal-AI application. It may contain errors, inaccuracies, or hallucinations. The content is provided for informational purposes only and should not be relied upon as legal advice or authoritative interpretation of regulations.

We accept no liability whatsoever for any decisions made based on this article. Readers are strongly advised to:

• Consult the official regulation text from government sources
• Seek professional legal counsel for specific matters
• Verify all information independently

This experimental AI application is designed to improve access to regulatory information, but accuracy cannot be guaranteed.