Update on Import Regulations for Indonesia

Legal Updates | Update on Import Regulations for Indonesia

Indonesia’s Ministry of Trade (“MOT”) recently issued new regulations that affect a number of rules for importing different products.

Import of Certain Products

MOT Regulation No. 87/M-DAG/PER/10/2015 regarding Provisions on the Import of Certain Products (“MOT Reg. 87/2015”) revokes MOT Regulation No. 83/M-DAG/PER/12/2012 regarding the same, as amended several times, lastly by MOT Regulation No. 73/M-DAG/PER/10/2014 (together, “MOT Reg. 83/2012”).

MOT Reg. 87/2015 no longer requires importers of certain products such as beverages, cosmetics, electronics, etc. to obtain the designation of Registered Importer of Certain Products (“IT-Produk Tertentu”) to import these products. An importer with a General Importer Identification Number (“API-U”) can import certain products without having to obtain an additional stipulation or approval. The issuance of MOT Reg. 87/2015 has raised concerns because it makes it easier for importers to import certain products without having to be stipulated as an IT-Produk Tertentu and could result in increased imports of concerned products to Indonesia.

MOT Reg. 87/2015 is effective from 1st November 2015 to 31st December 2018. Registered Importer of Certain Products designations issued under MOT Reg. 83/2012 remain valid until their expiration.

Import of Horticultural Products

The import of horticultural products has been re-regulated under MOT Regulation No. 71/M-DAG/PER/9/2015 regarding Provisions on the Import of Horticultural Products (“MOT Reg. 71/2015”). This new regulation revokes MOT Regulation No. 16/M-DAG/PER/4/2013, as amended twice, lastly by MOT Regulation No. 40/M-DAG/PER/6/2015 (together, “MOT Reg. 16/2013”).

As with MOT Reg. 16/2013, MOT Reg. 71/2015 lists the horticultural products that can be imported. Under MOT Reg. 71/2015, importers with an API-U or Producer Importer Identification Number (“API-P”) that wish to import horticultural products must obtain Import Approval. Under MOT Reg. 16/2013, importers with an API-P intending to import horticultural products had to obtain recognition as a Producer Importer of Horticultural Products (“IP-Produk Hortikultura”), while importers with an API-U had to obtain recognition as a Registered Importer of Horticultural Products (“IT-Produk Hortikultura”) followed by obtaining a separate Import Approval from the MOT. The amount of horticultural products that can be imported every year will be determined in a coordinating meeting between the relevant ministries/government agencies.

Import Approvals issued under MOT Reg. 71/2015 can be divided into: (i) Import Approval for fresh horticultural products, the application for which can be submitted twice a year within a certain period of time; (ii) Import Approval for fresh horticultural products for chili peppers and fresh red onions for consumption, the application for which can be submitted at any time; and (iii) Import Approval for processed horticulture products, the application for which can be submitted at any time. Each company can have more than one Import Approval.

Horticultural products imported by an API-U holder can only be traded and/or transferred to a distributor and cannot be traded and/or transferred to consumers or retailers. Horticultural products imported by an API-P holder can only be used as raw materials or supporting materials for the API-P holder’s own production and cannot be traded or transferred to another party.

The Import Approval for companies having an API-U shall be valid in accordance with the term of the Horticultural Products Import Recommendation (“RIPH”) from the Ministry of Agriculture, while the Import Approval for companies with an API-P shall be valid for a maximum period of six months.

IP-Produk Hortikultura, IT-Produk Hortikultura and Import Approvals issued based on MOT Reg. 16/2013 remain valid until their expiration date.

Import of Used Capital Goods

The MOT issued a new regulation governing the import of used capital goods, which are goods used as working capital to produce products that can be used or that can be reconditioned, remanufactured or refunctioned. This does not include scrap. The new regulation, MOT Regulation No. 127/M-DAG/PER/12/2015 (“MOT Reg. 127/2015”), took effect on 1st February 2016 and expires on 31st December 2018.

MOT Reg. 127/2015 revoked MOT Regulation No. 75/M-DAG/PER/12/2013 (“MOT Reg. 75/2013”). It sets out that used capital goods listed in the attachments of MOT Reg. 127/2015 can be imported by a (i) direct user company, (ii) reconditioning company or (iii) remanufacturing company that has obtained Import Approval from the Director of Imports at the Directorate General of Foreign Trade at the Ministry of Trade. Unlike MOT Reg. 75/2013, MOT Reg. 127/2015 does not include medical device supplier companies among those companies that can import used capital goods.

MOT Reg. 127/2015 requires a Builder Certificate or technical recommendation (pertimbangan teknis) from the relevant authorities as a supporting document for the import of used goods with certain HS codes by direct user companies and reconditioning companies.

Import Approvals issued under MOT Reg. 127/2015 shall be effective for one year as of their stipulation date and can be extended once for a maximum period of 60 days. The extension application must be submitted no later than 30 days before the expiry date of the Import Approval.

Used capital goods imported by a direct user company that have been used for more than five years can be traded and/or transferred to another party.

The previous regulation, MOT Reg. 75/2013, allowed used capital goods not listed in the attachment of MOT Reg. 75/2013 to be imported in certain amounts by applying for an Import Approval after obtaining a recommendation from the relevant authority. This allowance is not included in MOT Reg. 127/2015. According to an MOT official consulted by SSEK on a no-name basis, it is unlikely that importers will be granted Import Approval to import used capital goods that are not listed in MOT Reg. 127/2015.

Import Approvals issued under MOT Reg. 75/2013 remain valid until their expiration date.

SSEK - 2nd November 2016

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Indonesia Snapshot

Capital: Jakarta
Population: 259 million (2016)
Currency: Indonesian Rupiah
Nominal GDP: $936 billion USD (IMF, 2016)
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