Twenty-three companies have been fined or had licenses revoked after causing forest fires that spread thick haze across Southeast Asia. The Indonesian government said it was still investigating scores of other firms.
The punitive action follows criticism of Indonesian authorities for their failure to act to prevent such a widespread use of fires, which led to the worst pollution in the region for almost two decades.
Twenty-three companies were sanctioned or had land-clearing licenses revoked, after being found to be responsible for starting the fires.
Those firms facing punishment were mostly pulp wood and palm oil plantations operating on Sumatra and Borneo islands. As a result, three companies shut down altogether.
The forest fires led to the deaths of 19 people as they spread lingering haze across Singapore, Malaysia and Indonesia.
Urban areas affected
The smog caused a health and environmental crisis, estimated to have cost the Indonesian economy around $16 billion. More than half a million people suffered acute respiratory infections in Indonesia alone.
Tuesday's announcement was the first time the government has revoked company licenses over forest fires, an annual occurrence caused by slash-and-burn land clearance.
The haze severely limited visibility in Malaysia's capital Kuala Lumpur for several weeks, causing health problems
The Forestry Ministry's investigations director, Brotestes Panjaitan, said a further 33 firms remained under scrutiny and that decisions on possible punishment were still to be decided.
"We do not hesitate to take stern legal action against companies found violating the law," Panjaitan said on Tuesday.
The ministry confirmed that a total of 56 companies were involved in illegal land-clearing activities and that 276 firms were investigated since the latest fires broke out in September.
The firmer response was welcomed by environmental activists, who said the most the government had done until now was to name suspects allegedly involved in the forest fires.
"The minister has the courage to not only freeze the companies' operation but also chase the owners in a civil case, this is great and this must be guarded carefully," Riko Kurniawan, from The Indonesian Forum for Environment told Agence-France Pres.
He added that it was unheard of for the government to revoke licenses and many companies previously avoided facing trial.
Forest fires have been an annual problem in the region since the mid-1990s, but this year's was the worst since 1997 when blazes spread across nearly 10 million hectares.
Last year, regional countries signed an agreement on transboundary haze pollution but calls for Indonesia to do more had, until now, fallen on deaf ears, some analysts said.
mm/jm (AFP, AP)