THE POLITICS OF REDRESS VERHANDELINGEN VAN HET KONINKLIJK INSTITUUT VOOR TAAL-, LAND- EN VOLKENKUNDE 263 PETER KEPPY THE POLITICS OF REDRESS War damage compensation and restitution in Indonesia and the Philippines, 1940-1957 KITLV Press Leiden 2010 Published by: KITLV Press Koninklijk Instituut voor Taal-, Land- en Volkenkunde (Royal Netherlands Institute of Southeast Asian and Caribbean Studies) P.O. Box 9515 2300 RA Leiden The Netherlands website: www.kitlv.nl e-mail: [email protected] KITLV is an institute of the Royal Netherlands Academy of Arts and Sciences (KNAW) Cover: Little girl in Kamal, Madura, bewildered by the destruction of her village during the First Police Action (KITLV 14078). Cover: Creja ontwerpen, Leiderdorp ISBN 978 90 6718 369 7 © 2010 Koninklijk Instituut voor Taal-, Land- en Volkenkunde No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording, or any information storage and retrieval system, without permission from the copyright owner. Printed in the Netherlands Contents Acknowledgements ix Abbreviations xi I Introduction 1 Redress 3 War damage compensation and restitution 4 Sources 7 How to read this book 10 Spelling 11 II Era of change 13 The Dutch East Indies in the 1930s 14 The Philippines: sugar and planters’ politics 18 Greater East Asia Co-Prosperity Sphere 21 Philippine independence and the nation’s ‘special relationship’ with the USA 28 Revolution and independence in Indonesia 29 The American occupation of Japan 32 III War damage 37 Pre-emptive demolition 37 Rampok 42 Brisbane plans 47 New war, more damage 48 The Hens Committee 52 The Hart Committee 60 Reparations? 63 The War Damage Council and Bureau 64 The 1946 Philippine War Rehabilitation Act 67 USA: beacon to follow 70 Summary 74 IV Scorched earth, soft peace 77 Damage registration 83 Zorab’s rearguard action 87 vi Contents No compensation? 91 Legal hair-splitting 93 Claims 95 Indonesian viewpoints 103 Article 14b of the Peace Treaty 105 The Back Pay Committee 109 Summary 113 V The spoils of war 117 Enemy property 117 Japanese ‘administration’ 122 Economic mobilization 128 Tekisan Kanribu 131 Defeat the enemy with diamonds! 136 The Army and private enterprise 140 The plantation sector 146 The ‘Greater East Asia Robbery Sphere’ 153 Summary 156 VI Restitution: laying the groundwork 157 Eggens 157 Transfer 159 Allied shield 164 Restitution in the Dutch East Indies 170 The Temporary Council 172 Drafting legislation 174 Big business and restitution 176 Half-hearted implementation 179 Restitution dilemmas in the Philippines 182 Summary 186 VII Restitution in practice 189 Jurisprudence 196 Planters’ plight 199 After the transfer of sovereignty 203 Incomplete restitution 207 Restitution of agricultural enterprises 209 Summary 213 VIII Tracing the loot 217 Origin unknown 218 Dutch East Indies initiatives 220 Civil Property Custodian 224 Full and prompt restitution? 227 Obstruction 231 Restitution Advisory Committee 237 Restitution claims 238 Debt and sale 244 Contents vii The Secured Fund and ‘unidentifi ed’ diamonds 247 Hospital ship ‘Op ten Noort’ 249 Summary 254 IX Conclusion 255 War damage and compensation 255 Looting and restitution 257 Reconstruction and the rule of law 261 Bibliography 263 Index 275 Acknowledgements Just as the war had its aftermath, so did the book I wrote as part of the Indonesia Across Orders project (2002-2006) organized by the Netherlands Institute for War Documentation (NIOD). Once completed, the book was adapted and translated into English. This would not have been possible without Dr. Wouter Veraart of the Vrije Universiteit Amsterdam, who shared with me his sharp insights on law and society; Dr. Remco Raben (University of Utrecht), who untiringly imparted a great deal of knowledge on the decolonization of Indonesia; Otto van den Muijzenberg (Professor Emeritus of Sociology and Modern History of South and Southeast Asia, University of Amsterdam), who ensured that I got my facts straight on the Philippines; and Dr. Robert Cribb (Australian National University) for his geographical maps. This book would not have been possible without a translation subsidy from the Netherlands Organisation for Scientifi c Research (NWO). My thanks to Mischa Hoyinck and Robert Chesal: not only for their fi ne translation work but also for making constructive suggestions and refi ning the text. Last but not least, I would like to thank NIOD for providing the kind of research environment in which this book could become a reality. Terima kasih Peter Keppy Netherlands Institute for War Documentation Abbreviations AIO Algemene Import Organisatie ALS Algemeen Landbouw Syndicaat AMACAB Allied Military Administration Civil Affairs Branch ANP Algemeen Nederlands Persbureau ANRI Arsip Nasional Republik Indonesia AS Algemene Secretarie AWA Algemene Werknemers Associatie BAT British American Tobacco Company BI Bank Indonesia BKR Badan Keamanan Rakyat Borsumij Borneo-Sumatra Maatschappij BPM Bataafsche Petroleum Maatschappij BTI Barisan Tani Indonesia CAB Commissie Achterstallige Betalingen CBS Centraal Bureau voor de Statistiek CHTH Chung Hua Thung Hui CLO Central Liaison Offi ce COMTIEB Commissie Terugvoering Indische Eigendommen in het Buitenland CONIE Commissie tot Opsporing van Nederlands-Indische Eigendommen CPC Civil Property Custodian CRO Commissie Rechtsverkeer in Oorlogstijd CVO Centrale Verkooporganisiatie van Ondernemingslandbouwproducten DIRVO Directie Verre Oosten ESS Economic and Scientifi c Section FAI Federatie van Ambtenarenorganisaties uit Indonesië FEC Far Eastern Commission Federabo Federatie van Bergondernemingen Finec Financieel-Economisch overeenkomst HCLC Holding Company Liquidation Commission HVA Handelsvereniging Amsterdam HTK Handelingen der Tweede Kamer ICC Indische Contact Commissie IISG Internationaal Instituut voor Sociale Geschiedenis IVK Indische Verzekeringskamer xii Abbreviations Internatio Internationale Crediet- & Handelsverenging ‘Rotterdam’ IOB Indische Ondernemersbond JACAR Japan Center for Asian Historical Records JB De Javasche Bank JCS Joint Chiefs of Staff KL Koninklijk Leger KNIL Koninklijk Nederlands-Indisch Leger KPM Koninklijke Paketvaart Maatschappij MBZ Ministerie van Buitenlandse Zaken MVK Ministerie van Koloniën NA Nationaal Archief NARA U.S. National Archives and Record Administration Nanpo Bank Nanpo Kaihatsu Kinko NEFIS Netherlands Forces Intelligence Service NHM Nederlandsche Handel-Maatschappij NIAM Nederlands-Indische Aardoliemaatschappij NIBEG Nederlands-Indische Bond van Ex-Krijgsgevangenen en Ex- Geïnterneerden NIBI Nederlands-Indisch Beheersinstituut NICA Netherlands Indies Civil Admin., later renamed AMACAB NIGIEO Nederlands-Indische Gouvernements Import- en Export Organisatie NIOD Nederlands Instituut voor Oorlogsdocumentatie NIVIG Nederlands-Indische Vereniging van Importeurs-Handelaren NMM Nederlandse Militaire Missie NNGPM Nederlandse Nieuw-Guinea Petroleum Maatschappij NPPM Nederlandse Pacific Petroleum Maatschappij OHR Ordonnantie Herstel Rechtsverkeer ONRANI Ondernemersraad van Nederlands-Indië PERMIRI Peroesahaan Minjak Repoeblik Indonesia PKI Partai Komunis Indonesia RAC Restitution Advisory Committee Recomba Regeringscommissaris voor Bestuursaangelegenheden RIOD Rijksinstituut voor Oorlogsdocumentatie RIS Republik Indonesia Serikat RTC Round Table Conference R&R delegation Restitution and Reparation delegation RvR Raad voor het Rechtsherstel Sarboepri Serikat Boeroeh Perkeboenan Republik Indonesia SCAP Supreme Commander for the Allied Powers SKKK Saibai Kigyô Kanri Kôdan SKR Saibai Kigyô Rengokai SKZ Shokuryo Kanri Zimusho SOB Staat van Oorlog en Beleg Stanvac Standard Vacuum Oil Company TNI Tentara Nasional Indonesia TRK Tôgyô Rengô Kai VSI Verenigde Staten van Indonesië YSB Yokohama Specie Bank CHAPTER I Introduction The Second World War brought destruction and loss of property on a scale unprecedented in modern history. All over the world, governments sought ways to compensate citizens and businesses affected by the war and occu- pation. Some designed special legislation aimed at restoring the rule of law subverted by the occupation, some sought redress for emotional suffering, while others aimed at forging national unity through the creation of war tri- bunals and amnesty laws. There were no precedents for these governments to look to. Moreover, the aftermath of World War II was infl uenced by various social, economic and political conditions which differed from place to place. In Southeast Asia, the decolonization process played a key role. The politics of redress; War damage compensation and restitution in Indonesia and the Philippines focuses on the compensation of damage and loss of property due to World War II in the context of decolonization. This study deals with law and society with a special emphasis on the political and economic aspects of redress. It is an adaptation of a Dutch-language book published in response to persistent questions from the Eurasian community in the Netherlands about how the Dutch East Indies and (post-war) Dutch governments had handled the issue of compensation for war damage resulting from the Japanese occupation of Indonesia and the Indonesian revolution (Keppy 2006). This book deals with two seemingly related concepts, which, legally speaking, are completely different: war damage compensation and restitution. War damage compensation refers to compensation of material damage due to an armed confl ict between countries, and to the laws and other regulations