Law No. 41/1999 reasserts the principle that all forest land in Indonesia is controlled by the state for the prosperity of its people (Article 4), including customary forest or hutan adat, where management, not property, can be devolved to an adat community (Article 5). Special management rights over forest land can be granted to educational or research institutions, social and/or religious organisations, and/or indigenous communities or masyarakat hukum adat.

The law also contains a definition of masyarakat hukum adat (Article 67), which claims that the state acknowledges and accommodates local adat rights as long as they exist and are legitimate and they do not conflict with national interests. If, in future, adat communities should no longer exist, the right to manage the forest would be returned to the state. The recognition of an adat community as well as its abrogation will be established in regional regulations.

According to this section of the law, legitimate adat communities are those where:

Legitimate adat communities also have the right to:

Moreover, Article 34 of the Forestry Law states that the history of local communities and their institutions must be considered, as well as their record in management and conservation of the ecosystem. Although not directly related to the management of protected areas, the statement provides a strong mandate for the recognition and involvement of local institutions in the management of forests where such institutions exist.

A contentious issue remains to be resolved in that the legal existence of the adat community is contingent on its recognition and legitimation by the government. Similarly, the government would also decide whether adat rights would be abolished when adat institutions ceased to exist. The relevance of adat is thus subject to legal provisions outside the context of traditional law. Although there is an explicit recognition of adat claims over forest land, this is done within the framework or nomenclature of a state forest (Nugraha 2000: 3).

This situation has the potential to undermine the authority of adat and the sustainability of arrangements involving adat. Chris Bennett argues that:

the key to a positive outcome is for adat or long established institutions to gain their legitimacy from below and from above, and allow the local community to decide which of its adat institutions should be formally recognised (personal communication, February 2001).

A draft government regulation on adat forest (Government of Indonesia 2000), which is currently being discussed, reinforces the basic principle of authority that adat forest is state forest. The draft specifies steps that need to be taken to recognise the existence of adat communities and establish the legitimacy of adat claims. It also clearly states (in Article 3) that adat communities that no longer exist cannot be re-established or resurrected. The Minister and regional government will form a research team comprising various experts in relevant disciplines who will determine the following:

The research methodology will be discussed and agreed between the Minister and the Indonesian Institute of Sciences.

As a cautionary note, potential shortcomings of this process must be indicated. For example, there might be a tendency to develop a standard methodological approach and impose it without due consideration of the local context. Moreover, the research process to establish the existence of an adat community and adat rights might take a very long time and entail high costs if it is to fulfill basic social science research standards, and ensure quality and reliability of results. There is a risk that short-term and superficial surveys by outsiders might be used to research the legitimacy of adat claims in order to cut costs and expedite the process. Moreover, there is no clear indication in the current draft of the government regulations whether existing documentation on adat communities and their claims to customary lands would be accepted by the government as valid. This would include evidence such as land-use and resource maps, customary regulations, and historical and cultural traditions. For example, in the Kayan Mentarang National Park area, the WWF project has already worked with the communities to compile thorough documentation on the existence of masyarakat hukum adat and the legitimacy of their claims over forest land by means of: long-term interdisciplinary research (see Eghenter and Sellato 1999, 2003); participatory community mapping activities (Sirait et al. 1994; Eghenter 2000b); and inventories of adat regulations and local institutions (Lawai 2001).

The law on decentralisation and regional autonomy (No. 22/1999 and No. 25/1999) concerns the transfer of political and financial powers from national or state level to sub-national or regional level. In this framework, reference to conservation and management of natural resources is minimal (Articles 7 and 10). The law states that the management of natural resources is transferred to regional (provincial and district) governments, but conservation policy and the authority over the management and development of protected areas remain the full responsibility of the Ministry of Forestry and Plantations.

The law contains some ambiguity with regard to the separation of jurisdiction between national and regional authorities in the management of natural resources. It also raises some questions concerning the level of decentralisation, whether at provincial or district level, for certain functions. According to Sembiring (2000), this ambiguity might create confusion and undermine the process of decentralisation unless it is improved in future drafts of the basic law or by further government regulations.

At a workshop in 1999, organised by the United States Agency for International Development and funded by the Natural Resource Management Project, several experts met to discuss what kind of management models would better suit the decentralisation scenario and guarantee more efficient management of National Parks. Saruan (1999) argued that management of National Parks in the new reality of decentralisation and regional autonomy would have to take into account the development plans of the regional or district government. In his view, these levels of government should be actively involved in setting up an efficient and transparent management system. Planning for the management of a National Park should follow a bottom-up approach and give priority to community-based models of conservation, where local conservation measures would be strengthened in the conservation area. Saruan further argued that the provincial office should be granted management autonomy while the central agency could act as a coordinating unit.

The integrity of a National Park in the future will not only depend on the effectiveness of conservation policies and application of existing laws, but also on compatible district legislation developed by the local parliament for the management of national natural resources which are located in its territory. The drafting of district regulations provides a good opportunity for conservation managers to work together with the local parliament on specific mechanisms outlining the role of the regional government in managing ‘national’ protected areas and for exploring collaborative institutional arrangements that would include the district government as part of the managing unit.