When Law Becomes a Shield for Crime: Administrative Concealment in Indonesia's Nickel Mining Sector

Abstract

Background Indonesia's nickel industry encounters a regulatory dilemma in which governance mechanisms intended for oversight may be utilised for obfuscation. This article explores the conversion of mining documents from tools of regulation into frameworks for state-sponsored economic offences, utilising the Mandiodo case as a case study. Methods This doctrinal legal study integrates Indonesian mining, anti-corruption, and corporate legislation with judicial documentation from the Mandiodo case, official prosecutorial resources, and global benchmarks (EITI, OECD). It establishes a structure to examine the legal boundaries separating administrative non-compliance from criminal behaviour. Results The analysis presents a five-phase Licensing-to-State-Economic-Crime (LSEC) model: legitimate access, bureaucratic manipulation, origin alteration, financial transformation, and obfuscation. It illustrates that illegal behaviour emerges from the intersection of knowledge, intentional manipulation, and illicit gain, rather than solely from documentation inaccuracies. The document further examines the ramifications of Constitutional Court Decision No. 123/PUU-XXIII/2025 and the ne bis in idem concerns arising from the ensuing money-laundering cases. Conclusions The study suggests a Mining Governance Integrity System that incorporates authenticated beneficial ownership, anomaly identification, traceability, and gatekeeper due diligence. Its role is to connect the boundaries of criminal law with the framework of extractive governance, with the objective of averting the criminalisation of legitimate economic risks.