Type of document: RA Standard

Scope: Indonesia

Status of document: FINAL

Date of this version: 31 July 2013

Consultation period: CLOSED

Approval body: Rainforest Alliance

Contact person: Chisato Tomimura

Contact email: ctomimura@ra.org

Title: Rainforest Alliance Standard for Verification of Legal Compliance (VLC) for Forest Management Enterprises (FME) in Indonesia

RA document code: VER-25

© 2013 Published by Rainforest Alliance. No part of this work covered by the publisher’s copyright may be reproduced or copied in any form or by any means (graphic, electronic or mechanical, including photocopying, recording, recording taping or information or retrieval systems) without the written permission of the publisher.

Introduction

This Rainforest Alliance1 Standard for Verification of Legal Compliance (VLC) for Indonesia was developed based on the RA Generic VLC Standard for FMEs version 12 April 13 to assess and verify that Forest Management Enterprises (FMEs) in Indonesia conform to the standard requirements related to forest harvesting laws and regulations applicable in Indonesia. The standard also includes requirements for chain of custody (CoC) to ensure that all points along the defined supply chain maintain systems to document and control the flow of verified wood.

Public Comment

The Rainforest Alliance encourages public comments and inputs to standards and procedures during and outside of the official consultation period. Organizations and individuals are encouraged to submit their concerns and/or comments regarding this standard to Rainforest Alliance, using the email address above.

Note on the use of this standard

All aspects of this standard are considered to be normative, including the scope, standard effective date, references, terms and definitions, tables and annexes, unless otherwise stated.

This standard shall be used as basis for adaptation of country or region-specific Verification of Legal Conformance standards and services offered by Rainforest Alliance.

Contents

A Scope

B Standard Effective Date

C References

1 Rainforest Alliance auditing services are managed and implemented within its RA-Cert Division. All related

personnel responsible for audit design, evaluation, and verification decisions are under the purview of the RA-Cert Division, hereafter referred to as Rainforest Alliance or RA.

D Terms and Definitions

E Standards and Requirements

Part I: Principles and Criteria for Verification of Legal Compliance

Part II: Principles and Criteria for Chain of Custody (CoC)

Part III: Multi-Site Management Requirements

A Scope

This standard is applicable to Forest Management Enterprises (FMEs) which shall be evaluated to all principles of the standard. The standard is applied to verify specifically defined forest areas, and does not verify individual batches of material.

In order to verify the existence of a credible Chain of Custody (CoC) system within the forest, FMEs shall also be evaluated against the CoC criteria for FMEs included in this standard. Any processing facility shall be evaluated against VER-23: Rainforest Alliance Generic Legality Standard for Processing and Trade.

Part III of the standard is only applicable to FMEs that have two or more Forest Management Units (FMUs) included in the scope of verification.

B Standard Effective Date

This standard shall be effective from the version date of the approved final version. The standard may be updated annually with any newly approved versions replacing previous versions. All verified operations shall comply with a national or regional adaptation of this standard within twelve (12) months of the version date.

C References

VER-01Verification of Legal Origin/Verification of Legal Compliance Supplementary Guide for Evaluation Version 15 May 2013 VER-04 Rainforest Alliance Generic Standard for Verification of Legal Compliance (VLC) for Forest Management Enterprises (FME) Version 12 April 2013 VER-20 Legality Verification Services Policy Version 14 May 2013 FSC-STD-30-010 Controlled Wood Standard for Forest Management Enterprises

D Terms and Definitions

AAC: Annual allowable cut

AMDAL: Analisa Mengenai Dampak Lingkungan. Environmental Impact Analysis

ANDAL: Environmental Impact Analysis. Included in AMDAL.

BAPEDALDA: Badan Pengendalian Dampak Lingkungan Daerah. Local Environmental Impact Management Agency.

BKT: Bagan Kerja Tahunan. Annual framework plan, which can be substituted for RKT (annual work plan). This document is approved only once for newly established FME or FME waiting for approval of their RKUPHHK.

CITES: The Convention on International Trade in Endangered Species of Wild Fauna and Flora

Chain of Custody (CoC): The path taken by raw materials, processed materials, finished products, and co-products from the forest to the consumer or (in the case of reclaimed/recycled materials or products containing them) from the reclamation site to the consumer, including

each stage of processing, transformation, manufacturing, storage and transport where progress to the next stage of the supply chain involves a change of ownership (independent custodianship) of the materials or the products.

Claim Category: The type of certification or verification scheme that applies to the material/product that is being tracked within the CoC control system.

DKB: Daftar Kayu Bulat. Log list.

DR: Dana Reboisasi. Reforestation Fund

Environmental and Social Impact Assessment: A voluntary assessment conducted to identify, evaluate and develop management measures for environmental and social impacts associated with the construction and operation of a project.

FA-KB: Faktur Angkutan Kayu Bulat. Log Transport Invoice.

Forest Management Enterprise (FME): Company or operation responsible for forest management.

Forest Gate: The place, e.g. standing tree, landing, mill site, where the harvested verified wood changes ownership from FME to purchaser.

Forest Management Unit (FMU): A clearly defined forest area with mapped boundaries, managed by a single managerial body to a set of explicit objectives which are expressed in a self-contained multi-year management plan.

IIUPHHK: Iuran Izin Usaha Pemanfaatan Hasil Hutan Kayu. Fee for Timber Forest Product Utilization License

IHMB: Inventarisasi Hutan Menyeluruh Berkala. Periodic Comprehensive Forest Inventory

ITSP: Inventarisasi Tegakan Sebelum Penebangan. Pre-harvesting inventory.

IUPHHK: Izin Usaha Pemanfaatan Hasil Hutan Kayu. Forest Timber Product Exploitation Permit. Concession permit.

JAMSOSTEK: Jaminan Sosial Tenaga Kerja. National insurance scheme for workers.

KKB: Komite Keamanan Bersama. Mutual work agreement

LHC: Laporan Hasil Cruising. Cruising Report. The document is prepared one year before the planned harvest.

LHP: Laporan Hasil Produksi. Harvest (production) report.

LMKB: Laporan Mutasi Kayu Bulat. Log mutation report. Balance sheet of logs.

NPWP: Nomor Pokok Wajib Pajak. Tax identity number.

PBB: Pajak Bumi dan Bangunan. Land and building tax.

PHPL: Pengelolaan Hutan Produksi Lestari. Indonesia’s national certification scheme for sustainable forest management.

PKAPT: Pedagang Kayu Antarpulau Terdaftar. Inter-Island Transport Permit

PSDH: Provisi Sumber Daya Hutan. Forest Resource Royalties.

RA: Rainforest Alliance

RA-Cert: Auditing and certification division of the Rainforest Alliance.

RKL: Rencana Pengelolaan Lingkungan. Environmental Management Plan

RPL: Rencana Pemantauan Lingkungan. Environmental Monitoring Plan

RKUPHHK: Rencana Kerja Usaha Pemanfaatan Hasil Hutan Kayu. Timber Forest Product Utilization Work Plan. Long-term management plan.

RKT: Rencana Kerja Tahunan. Annual work plan.

SIPUHH: Sistem Informasi Penatausahaan Hasil Hutan. Forest Product Administration Information System.

SIUP: Surat Izin Usaha Perdagangan. Trading Business License.

SKSKB: Surat Keterangan Sahnya Kayu Bulat. Certificate of Legality of Forest Products. Shipping document for round logs.

SMK3: Sistem Manajement Keselamatan dan Kesehatan Kerja. Occupational Health and Safety Management Program.

SPK: Surat Perjanjian Kerja. Employment contract.

SPP: Surat Perintah Pembayaran. Payment order.

TDP: Tanda Daftar Perusahaan. Company Registration Certificate.

TPK: Tempat Penimbunan Kayu. Log concentration yard or log pond.

TPn: Tempat Pengumpulan Kayu. Log landing site in forest.

Verification Agreement is a legal document signed by the verified organization and the Rainforest Alliance after the organization has met all of the requirements of the VLO or VLC as outlined in the standards and policies and before the organization is issed a verification statement. The agreement establishes the provisions, terms, and limitations of the verification statement.

Verification Statement: Refers to the document that the Rainforest Alliance issues upon confirming that the candidate operation has met all the requirements for VLO or VLC as outlined in the standards and policies.

Verification Statement Holder: Refers to the legal entity that the verification statement is issued to. In relation to multi-site verifications (verification of a whole or part of a supply chain) it is the verification statement holder that is responsible for the maintenance of conformance to the applicable standard.

E Standards and Requirements

In this standard each principle and its associated criteria are stated along with generic indicators. All of the criteria and indicators shall be audited in every verification audit, unless certain criteria or indicators are not applicable for the jurisdiction or the operation under evaluation.

Part I: Principles and Criteria for Verification of Legal Compliance

Principle 1: Legal Right to Harvest

The legal status of the FME shall be clearly defined and its boundaries delineated. The FME shall prove that it has validly obtained the legal right to operate and to harvest timber from within the defined FMU.

1.1: Clear and documented legal registration of FME with authorization to carry out forest management activities shall exist.

1.1.1: FME shall have valid tax registration number/forms and a business license to operate within the jurisdiction.

– Concessionaire shall hold following legal document:

Valid Ministry of Forestry Decree (SK) granting a concession (IUPHHK-HA/HPH, IUPHHKHTI/HPHTI, IUPHHK RE)

The Company’s Deed of Incorporation

Taxpayer’s Registration Number (NPWP)

Business License (SIUP)

Company Registration Certificate (TDP)

1.1.2: The registration of FME forest areas to be utilized and managed shall have been granted according to the legally prescribed process.

Note: Refer to the Appendix I and II for specific documents required for the process of getting a new concession license and license extension process.

1.1.3: Legal status of the operation or rights for conducting the established activities shall not be subject to a court or other legally established order to cease operations.

1.1.4: If the legal status and rights are being challenged, FME shall be engaged in a legal process to resolve the challenges.

1.2: FME shall have legal authorization to harvest in FMUs.

1.2.1: FME shall have documented permission from the resource owner to harvest, including those with rights held according to customary law, where legally recognized.

Note: District level law and local conditions should be considered in evaluation of this requirement. Proof of compensation paid by FME to local communities according to the local regulation can be accepted as evidence.

1.2.2: Where applicable, FME shall hold a valid permit, license or similar legal document governing the harvesting of forest resources issued by the legally designated authority.

– A concessionaire shall have a valid Ministry Decree (SK) granting the concession. (IUPHHK-HA/HPH, IUPHHKHTI/HPHTI, IUPHHK RE)

– Not applicable for community forestry located in non-state or private land.

1.2.3 FME shall possess an up-to-date map of FMUs to which it has legal rights to harvest.

1.3: Evidence shall exist that the forest management area has been legally classified for the type of land-use or commercial activities conducted.

1.3.1: The forest harvesting activities shall correspond to the legal land use classification for the FMU.

1.3.2: The forest harvesting area shall be indicated on a map at a scale to permit identification of boundaries.

1.3.3: The harvesting areas shall not conflict with land-use classifications for areas where timber harvesting is prohibited.

– Timber harvest shall only occur in production forest and non-production forest area.

1.3.4: The designation of the FMU for timber harvesting of the type being carried out shall have followed the legally prescribed procedures.

Principle 2: Approved Planning Authorizations and Operations

The FME shall have received the necessary approval for the basic and fundamental planning requirements legislated as necessary to enable forest management and shall adhere to the planning and operational requirements.

2.1: A Forest Management Plan approved by the relevant authorities shall be in place prior to commencement of corresponding forest management activities. (Required for all concessionaires)

2.1.1: A Forest Management Plan shall be in place prior to commencement of utilization of the forest and approved by the relevant authorities, if legally required.

– For all concessions, long-term (10 year) management plan (RKU) approved by Ministry of Forestry shall be in place or there shall be approved annual work plan (RKT) along with solid evidence the RKU is under development.

– Not applicable for community forests.

2.1.2: The Forest Management Plan shall have been approved according to the legally prescribed process.

– Record of correspondence for the approval process shall be in place.

2.1.3: Clear evidence (e.g., maps) shall confirm that the management plan area is located within the licensed FMU.

2.2: Annual operating or harvesting plans shall be in place and approved by legally qualified authorities. (Required for all concessionaires)

2.2.1: FME shall have a current, approved operating or harvesting plan.

– Long-term Forest Management Plan (RKUPHHK) authorized by Local Forestry Services (Dinas Kehutanan) and Ministry of Forestry.

– Annual Forest Management Plan (RKT)

– For new concessionaires waiting for approval of RKUPHHK, Annual Framework Plan (BKT) valid for 12 months.

Note: FME with mandatory or voluntary PHPL certificate can have a self-assessed RKT.

2.2.2: The contents of the operating and harvesting plans shall be consistent with approved forest management plans and adhered to in the field.

– Contents of RKU and RKT shall be consistent.

2.3: Legally prescribed diameter restrictions and annual allowable cut or production quotas shall clearly be included in applicable planning and operational documents.

2.3.1: Annual work plan (RKT) shall include annual allowable cut (AAC).

2.3.2: Minimum diameter for felling shall be written in RKT.

2.4: Harvesting and felling shall be strictly confined to areas and species approved for harvesting by national, regional or local regulations; these shall be adhered to in practice and, if legally required, identified in the operating or harvesting plans.

2.4.1: Only species and/or trees allowed for harvest by applicable laws shall be harvested.

2.4.2: If legally required, tree species or selected trees found within the FMU for which felling is prohibited shall be listed in operational plans, identified on maps, and marked on the ground.

– Protected species shall be marked on the ground.

– The protected species found within FMU should be identified in reference to the national regulations, CITES.

2.4.3: Harvesting shall only be conducted within the authorized boundaries of FMU and shall not take place in areas where harvesting is legally prohibited or subject to restrictions.

2.4.4: If legally required, areas where harvesting is prohibited or subject to legal restrictions (e.g., riparian buffers, slopes exceeding a set gradient, etc.) shall be identified in the management plans and maps. (Required for all concessionaires).

– Riparian buffer zone and slope exceeding 40% shall be identified.

2.4.5: Wood confiscated or seized from illegal operations shall not in any case be allowed as legally verified.

2.5: If legally required, approved Environmental and Social Impact Assessments shall be in place and approved by the legally qualified authority. (Required for all concessionaires)

2.5.1: FME shall have AMDAL containing environmental and social assessment approved by AMDAL Committee.

– AMDAL shall include ANDAL (Environmental Impact Analysis), RKL (Environmental Management Plan), RPL (Environmental Monitoring Plan) and other associated documents.

2.6 FME shall keep approvals and related documents for a minimum of five (5) years.

Principle 3: Payment of Relevant Fees and Taxes

The FME shall fulfill all obligatory taxes, fees and/or royalty payments associated with maintaining the legal right to harvest and permitted harvesting volumes.

3.1: All applicable and legally prescribed fees, royalties, taxes and other charges shall be paid in a timely manner.

3.1.1: FME shall be current with required payments and shall maintain documentation for receipt of royalties, fees and dues by beneficiaries.

– All concessionaires shall hold evidence of the payment of the (License) Fee for Timber Forest Product Utilization License (IIUPHHK).

– Natural forest concessionaires shall be up to date with payment of DR (Reforestation Fund) and PSDH (Forest Resource Royalties).

– Plantation concessionaires shall be up to date with the payment of PSDH.

– Where applicable, compensation for local communities shall be paid.

– Land and building tax (Pajak Bumi dan Bangunan; PBB) shall be paid annually.

3.1.2: Taxes and royalties shall be paid according to the actual harvested volume, species and qualities following legal requirements.

– Payment of DR and PSDH is consistent with SPP (Payment Order).

3.1.3: Income tax shall be declared according to the legislation and applicable tax shall be paid within required timelines.

Note: In case there is outstanding payment due to the company’s financial situation, there shall be a plan to pay in instalments.

Principle 4: Transport and Trade

The FME shall adhere to applicable transport, trade, import or export regulations, procedures and restrictions.

4.1: FME shall adhere to applicable wood and wood product trade and transport regulations and/or restrictions, including regulation of offshore trading and transfer pricing where applicable.

4.1.1 FME shipping logs to other islands shall have a valid Inter-Island Transport Permit (PKAPT).

4.1.2. All log shipment shall be accompanied by legal document specified by P.55/2006.

– SKSKB and DKB for log shipping from a harvesting block of natural forest to a TPn (log landing site).

– FAKB from TPn to a log pond after the payment of tax and royalties.

– Concessionaires that harvest more than 50,000 m3 per year shall use a barcode (SIPUHH) on logs as required by the Ministry of Forestry.

4.1.3. FME shall maintain all documentation of timber administration located at each node of log transfer, including LMKB (Laporan Mutasi Kayu Bulat).

4.2: Permission to trade CITES-listed species shall be documented, and compliance with the applicable provisions and requirements of CITES shall be demonstrated.

Principle 5: Fulfilment of Harvesting Regulations

The FME shall be operating in compliance with legal requirements relating to the harvesting of forest products. Management plans and annual operating plans as required by law shall exist, shall contain accurate information, and be adequately implemented. This principle provides additional requirements in addition to the requirements of Principle 2.

5.1: Compliance with relevant local and national laws, and legally binding codes of practice relating to forest management and harvesting operations shall be documented.

5.1.1: FME shall adhere to all legally prescribed specifications for harvesting, in addition to those covered in criteria 2.3 and 2.4, covering aspects such as timing, harvesting procedures, equipment, and/or layout of harvest.

– FME shall register heavy machinery used in forest operation.

5.1.2: Diameter of trees felled recorded in LHP shall not exceed the minimum diameter specified in planning documents.

5.1.3: Annual production shall not exceed the Annual Allowable Cut (AAC) specified in Annual work plan (RKT).

5.2: FME shall be in compliance with forest management plan requirements.

5.2.1: Forest management plans shall contain all legally required information and procedures.

– The forest management plan (RKU) shall specify silvicultural system used in the forest management.

5.2.2: ITSP (Pre-harvesting inventory) shall be in place before harvesting.

5.2.3: Natural forest concessionaires shall have tree maps showing all harvestable trees and all legally required elements.

5.2.4: In natural forest concessions, trees shall be marked or tagged in the field according to their status for harvest.

5.2.5: FME shall implement the management plan according to all applicable legal requirements.

5.3: FME shall be in compliance with requirements in annual operating or harvesting plans.

5.3.1: Annual operating or harvesting plans shall contain accurate information and procedures, according to all legal requirements.

– The approved annual forest management plan (RKT) shall have maps such as working map, topographic map, trees map.

5.3.2: FME shall implement the annual operating or harvesting plans according to all legal requirements.

5.4 Harvesting record shall be compiled according to legal requirements.

– FME shall have Buku Ukur and LHP (Laporan Hasil Produksi) consistent with LHC (Cruising Report), and LMKB (Laporan Mutasi Kayu Bulat).

5.5 FME shall document that all contractors comply with legally required registration and with legal requirements to undertake harvesting activities.

Principle 6: Fulfilment of Environmental Regulations

The FME shall demonstrate compliance with local and national laws relating to the environmental obligations of a forest management operation, including but not limited to conservation of protected areas, wildlife, rare, threatened and endangered species, water and soil.

6.1: FME shall implement legally required environmental precautions and impact mitigation measures required (e.g. those related to soil damage, buffer zones, retention of trees, seasonal restrictions)

6.1.1: FME shall restore disturbed sites (e.g. log landing, skid trails) after harvest according to legal requirements.

6.2: FME shall implement legally required measures for the protection of protected areas, protected species etc.

6.2.1: Conservation zones (e.g. buffer zones) shall be established, mapped and protected according to legal requirements.

6.3: All legally required procedures for surveying, managing and protecting endangered or threatened species within the management unit shall be followed.

6.4: Employees of the FME shall be prohibited from hunting and trade of wildlife, unless it is legally permitted and documented permission from the resource owner exists.

6.5. FME shall be in compliance with legal requirements of environmental monitoring, if applicable.

6.5.1: FME shall submit environmental management plan (RKL) and environmental monitoring plan (RPL) to the authority (BAPEDALDA: Local Environmental Impact Management Agency) every six months.

Principle 7: Worker’s Rights

The FME shall demonstrate compliance with local and national laws relating to social issues such as health and safety, labor laws, and third parties’ use rights.

7.1: FME and contractors shall meet all applicable laws and/or regulations covering health and safety of employees and their families.

7.1.1: Legal requirements on Occupational Health and Safety shall be adhered to.

– Proper personal protective equipment (PPE) shall be provided by FME depending on the work type.

– FME shall have Health and Safety Program (SMK3)

7.1.2: National or regional minimum age established for persons involved in hazardous work shall be adhered to.

– Minors under 15 years old shall not be employed.

7.2: All employees and contractors of FME shall be employed under formal contract.

7.2.1: All employees shall have employment contract (SPK).

7.2.2: FME shall have Mutual Work Agreement (KKB) with employee representative witnessed by Manpower Agency (Dinas Tenaga Kerja).

7.2.3: FME shall not use contractors.

7.3: All employees shall be covered by applicable legally required insurance.

7.3.1: All employees shall be provided insurance (e.g. JAMSOSTEK).

7.4: All employees shall hold applicable legally required certificates of competence for the function they carry out.

7.4.1: FME shall keep certificate of trained staff.

7.5: All employees of FME shall be paid and treated in compliance with national laws and regulations as well as applicable international conventions.

7.5.1: FME shall adhere to the International Labor Organization's Fundamental Principles:

Freedom of association and the effective recognition of the right to collective bargaining;

Elimination of all forms of forced or compulsory labor; Effective abolition of child labor; Elimination of discrimination in respect of employment and occupation.

7.5.2: Minimum wage laws shall be followed if applicable.

– FME should have reference of minimum wage law issued by the provincial and/or district government.

Principle 8: Third Parties rights

8.1: Legally recognized customary rights shall be taken into account in management of forest resources.

8.2: Where notification to stakeholders affected by forest operations is legally required, timely announcements shall be made about planned activities within the legally specified time limits.

8.2.1: Concessionaires shall abide by free, prior, informed consent of stakeholders affected by forest operations (P.08/VI-BPPHH/2011, Attachment 1, Indicator#1.5).

– Record or evidence of agreement from local communities before harvesting shall be available.

Principle 9: Control of Unauthorized Activities

The FME shall work to control unauthorized or illegal activities. The FME shall identify, monitor, and implement activities to control illegal or unauthorized activities that may occur within the FMU.

9.1: Illegal or unauthorized activities, e.g., illegal logging, poaching or illegal settlement, that may occur within or through the forest shall be identified and documented.

9.2: Illegal or unauthorized activities shall be controlled in collaboration with the resource owner, regulatory agencies, and other relevant parties as appropriate.

Part II: Principles and Criteria for Chain of Custody (CoC)

Documented control of the Chain of Custody (CoC) of forest products is fundamental to the traceability of verified forest products from the forest source through manufacturing and distribution to ensure the authenticity of a verified product claim. This principle applies from the point of harvest up to the forest gate for FMEs.

Note: in the CoC criteria, “verified” refers to materials qualifying as Rainforest Alliance VLO/VLC or equivalent.

10 Quality System Criteria

10.1 FME shall define CoC system responsibilities and appoint staff positions, including the following:

a) One overall responsible person shall be designated for the CoC control system;

b) Individual responsible persons shall be designated for each critical control point in the CoC control system.

10.2 FME shall develop and maintain an up-to-date documented control system, procedures and/or work instructions to ensure implementation of all applicable CoC standard requirements.

10.3 FME shall develop and implement procedures for internal auditing of its systems as related to the requirements in this standard.

10.4 FME shall develop and implement procedures for addressing non-conformances (nonconformity reports, corrective action requests, observations) identified by auditors.

10.5 FME shall develop training requirements and implement training as follows:

a) All applicable staff and workers shall be trained on the CoC procedures to a degree relevant to the scale and complexity of the system and responsibility; and,

b) Records shall be kept to demonstrate training has taken place.

10.6 FME shall define and document verified product group under applicable Claim Categories.

10.7 FME shall define the sales system(s) or “Forest Gate” for each verified product covered by the CoC system (e.g., standing stock, sale from log yard in the forest, sale at the buyer’s gate, sale from a log concentration yard).

10.8 FME shall develop and maintain records to document quantities of verified materials for the following:

a) Production of materials;

b) Outputs sold with and without a claim.

c) Log transfer balance report in the form of LMKB (Laporan Mutasi Kayu Bulat)

11 Material Handling and Segregation

11.1 FME shall develop and implement an effective timber tracking system to demonstrate traceability from standing timber until ownership is transferred at the forest gate.

11.2 FME procedures and practices shall control the risk of mixing verified forest products with non-verified products which originate outside the scope of the verification.

Note: If all the wood harvested by the FME is included in the scope, this requirement is not applicable.

11.3 A system shall exist to identify FME products as verified (e.g., through documentation or marking system) at the forest gate.

11.4 FME shall keep verified material physically separate as secure units at all stages of harvesting, storing, and transporting.

Note: If all the wood harvested by the FME is included in the scope, this requirement is not applicable.

11.5 All material that cannot be identified as verified shall be kept physically separate from verified material.

Note: material that is pending evidence of its legal status shall be kept separate until such time that adequate documentation is obtained. If all the wood harvested by the FME is included in the scope, this requirement is not applicable.

11.6 FME shall use a distinguishing mark (e.g., the verification code) to identify products as verified at all stages of handling.

11.7 FME shall develop and implement procedures to ensure that markings to identify Rainforest Alliance verified materials are distinguishable from other verification/certification markings and claims.

Note: If FME does not use any certification/verification claim other than RA VLC, this requirement is not applicable.

12 Shipping and Sales Criteria

12.1 FME shall include claim information on sales invoices and shipping documents, including the following:

a) The quantity/volume and species for each product;

b) The Rainforest Alliance verification code RA-VLC-XXXXXX.

13 Claims and Public Information

13.1 FME shall not use the VLC claim until it is in possession of a valid Rainforest Alliance Verification Statement.

13.2 FME shall ensure that all VLC verification claims follow the applicable Rainforest Alliance policies:

a) On-product labeling shall not be permitted;

b) Rainforest Alliance Trademarks for off-product promotion shall not be used; public promotion of the VLC claim shall not be permitted.

c) Use of the verification code (RA-VLC-XXXXXX) on products shall only be used for traceability of products;

d) Business to business communication and promotion of VLC shall be approved by RA-Cert prior to being released by the organization for use.

13.3 FME shall have procedures in place and demonstrate that all review and approval correspondence with Rainforest Alliance for verification claims is kept on file for a minimum of five (5) years.

Part III: Multi-site Management Requirements

The multi-site management criteria have been developed to facilitate evaluation of organizations that have two or more sites included in the scope of their supply chain and wish to manage those under one Verification Statement. The multi-site management requirements, plus communication with Rainforest Alliance, are coordinated by the Verification Statement Holder.

Multi-site criteria allow Rainforest Alliance to evaluate the participating sites based on audit sampling in recognition of control and reporting systems monitored by the Verification Statement Holder. In addition to these criteria, Rainforest Alliance shall ensure that all sites included in the verification scope of a multi-site supply chain comply with all relevant legality and CoC requirements in the VLO or VLC verification standards as applicable.

14 Documented Procedures and Responsibility

14.1 The Verification Statement Holder shall appoint one person (or position) with overall responsibility for the multi-site management and conformance with Rainforest Alliance’s multi-site management requirements.

14.2 The Verification Statement Holder shall have documented procedures in place, covering all multi-site requirements of this standard.

15 Records

15.1 The Verification Statement Holder shall have access to, and collate data from all sites for Rainforest Alliance’s annual audits as well as upon request.

15.2 The Verification Statement Holder shall maintain up-to-date, centralized records for all sites for a minimum of five (5) years, including:

a) List of sites in the verification scope, including name, address, site manager, date of entry, and date of removal when applicable;

b) Records showing the scope of verification for each site;

c) Volume summary data for each product group, including purchases, production and conversion, inventory, and sales for each site.

16 Site Management and Auditing

16.1 All sites in the scope of the verification shall have signed a consent form that includes the following:

a) Agreement to conform to the obligations and responsibilities of participation in the multi-site verification for the period as described in the Verification Statement Holder procedures and the Rainforest Alliance VLC Verification Agreement;

b) Agreement to conform to the relevant Rainforest Alliance Standard(s) and correct any non-conformances identified by Rainforest Alliance and/or the Verification Statement Holder.

16.2 Prior to admitting a new site into the scope of the verification, the Verification Statement Holder designated auditor shall carry out an initial audit of each site to ensure that it complies with all the requirements of the applicable Rainforest Alliance verification standard.

16.3 The Verification Statement Holder designated auditor shall carry out an audit of each site at least once a year to confirm continual conformance with all the requirements of the applicable Rainforest Alliance verification standard.

16.4 When non-conformances are found during internal audits, the Verification Statement Holder shall issue corrective actions for the non-conformances to applicable sites and verify implementation.

16.5 The Verification Statement Holder shall provide reports with the results of all internal audits.

Appendix I: Process of Getting Forest Concession License

Source: Permenhut Nomor P.50/Menhut-II/2010 and revised by Nomor P26/Menhut/2012, and Nomor P.12/Menhut-II/2010, and P52/-Menhut-II/2008.

Required documents attached to license application:

Applicants

Submit application attached with required documents

Technical evaluation of the proposal by DG of FBD (Directorate General of Forestry Business Development

Conduct AMDAL (Analisis Mengenai Dampak Lingkungan

Submit legal approval of AMDAL

SP1

DG of FP (Forestry Planning) prepares working area (WA)

DG of FBD prepares SPP-Iuaran IUPH & IUPHHK decision letter

Payment of license fee (Iuran IUPH)

Handover IUPHHK

Ministry of Forestry

DG of FBD prepares SP1 for Minister of Forestry

DG of FBD prepares SP2 for Minister of Forestry

SP2

WA

IUPHHK decision letter

SPP-Iuran IUPH

IUPHHK received

1. Akte pendirian perusahaan dan perubahannya (legal establishment of company & its changes)

2. Surat Ijin Usaha Perusahaan (SIUP) 3. NPWP 4. Legal statement opening branch office at provincial and/or regency/city 5. Forest areas proposed on map with scale 1: 100,000 or 1:50,000 for respectively an

area above or under 100,000 ha 6. Governor recommendation attached with proposed location map at scale 1: 100,000 7. Technical proposal document containing: (a) general condition of forest area and

company, (b) propose & aim, (c) utilization plan, (d) sylviculture applied, (e) organization, (f) finance/cashflow, (g) forest protection.

Documents attached to WA (P50/Menhut-II/2010: 1. IUPHHK-HT : document of BPTT attached 2. IUPHHK-HA : no document of BPPT attached but BPTT must be made based on IHMB

at the time RKU made. Documents attached to WA (P26/Menhut-II/2012: 3. IUPHHK-HT : no document of BPTT attached 4. IUPHHK-HA : no document of BPPT attached but BPTT must be made based on IHMB

at the time RKU made. Note: BPPT: Bahan Penetapan Tebangan Tahunan (Data & info for AAC determination)

Appendix II: Process of Renewing Forest Concession License

Applicants

Submit application attached with required documents

Technical evaluation of the requirements by DG of FBD (Directorate General of Forestry Business Development

Not holding PHPL certificate

Holding PHPL certificate

DG of FP (Forestry Planning) prepares working area (WA)

DG of FBD prepares SPP-Iuran IUPH & decision letter of license extension (55 years)

Payment of license fee (Iuran IUPH)

Handover license extension

Ministry of Forestry

DG of FBD prepares assessment of PHAPL

DG of FBD prepares principal agreement of license extension

WA

Decision letter signed by Minister of Forestry

SPP-Iuran IUPH

Receive license extension

2 years before expire

assessment

No assessment Agreed

Required documents attached to application of license extension:

1. Governor recommendation 2. Akte pendirian perusahaan dan perubahannya (legal establishment of company & its

changes) 3. Written evidence that the company has paid financial obligations in forestry: Provisi Sumber

Daya Hutan (PSDH) dan Dana Reboisasi (DR) and others. 4. FME finance report for last 5 years that has been audited by public accountant referring to

Standar Akuntansi Keuangan Nomor 32 tentang Akuntansi Kehutanan 5. Map of areal location proposed at scale 1:50.000 or 1:100.000. 6. Mosaic map of aerospace photo at scale 1:20,000 or landsat imagery at minimum 30 m

resolution of 2 last years.