<![CDATA[This study aims to analyze the legal construction of nickel mining royalty obligations on integrated mining companies producing ferronickel and to assess the legal certainty of its imposition from the perspectives of the principle of legality, state control over natural resources, and the downstreaming policy. This normative legal research employs a statutory approach. The findings reveal that the legal construction of royalty imposition originates from the legal relationship between the state, as the holder of rights over natural resources, and business entities holding mineral exploitation rights (IUP/IUPK). The obligation to pay royalties serves as compensation for utilizing state resources attached to the permit holder's status, rather than merely from producing ferronickel. The construction of processing facilities (smelters) and ferronickel production represent the fulfillment of downstreaming obligations mandated by Article 103 of Law No. 3 of 2020. Regarding legal certainty, the normative basis for royalty imposition is established under Law No. 3 of 2020, Government Regulation No. 96 of 2021, and Government Regulation No. 26 of 2022. However, explicit provisions detailing the royalty mechanism for ferronickel as an intermediate product in integrated companies are lacking, leading to potential misinterpretations. Therefore, harmonization of legal norms is essential to ensure that the royalty mechanism reflects legal certainty, justice, and proportionality, thereby supporting downstreaming policies while optimizing state revenues. ]]>
