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This study focuses on the impacts of small-scale timber concessions known as Timber Extraction and Utilisation Permits (IPPK) on rural livelihoods of three forest dwelling communities in Malinau District, Indonesia. IPPKs have been issued since late 1999 as a result of the wide-ranging decentralisation taking place from the time when President Suharto resigned. Though, the legal basis for issuing IPPKs came to an end in late 2000, districts have continued giving out hundreds in some areas and new types of small-scale timber concessions are being planned.