IMPORT RESTRICTIONS IN INDONESIA

QUESTIONS FROM JAPAN TO INDONESIA

Import Restrictions on Various Products Including Electric Products, Steel Products, and Fabrics

The following communication, dated 2 September 2024, is being circulated at the request of the delegation of Japan.

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Japan has been concerned about the consistency of the import restrictions on various products by Indonesia in light of national treatment stipulated in Article 3 of the GATT, general elimination of quantitative restrictions stipulated in Article 11 of the GATT, national treatment and quantitative restrictions stipulated in Article 2 of the TRIMs Agreement, and the disciplines on non-automatic licensing under Article 3.2 of the Import Licensing Agreement. Japan has raised the issue in the relevant WTO committees thus far and submitted questions to Indonesia on steel products (9 July 2021) (_G/LIC/Q/IDN/45), air conditioners (September 2021), and carpets (September 2021). Japan thanks Indonesia for its replies to the questions on steel products circulated on 26 April 2022 (_G/LIC/Q/IDN/47) but has not received any responses so far on air conditioners and carpets. Also, the replies from Indonesia on steel products have not fully addressed Japan's concerns on the WTO consistency of the import restrictions by Indonesia.

Therefore, Japan again requests Indonesia to respond to the questions on air conditioners and carpets, and also submits the following additional questions.

Question 1

According to Indonesia's notification dated 9 November 2023 (_G/SG/N/8/IDN/27/Suppl.2), the extended safeguard measures on carpets and floor coverings were proposed to be implemented from 17 February 2024. Since then, the decision to extend the safeguard measures had not been notified under Article 12.1(c) of the Agreement on Safeguards for months. Moreover, the relevant domestic legislation, Minister of Finance Regulation No. 10/PMK.010/2021 dated 2 February 2021 regarding the Imposition of Safeguard Import Duty on Imports of Carpets and Other Floor-Covering Textile Products, which provided in Article 2 that the safeguard measure against the importation of Floor Coverings shall be in effect for 3 (three) years, had not be modified either. However, Indonesia’s new notification dated 14 August 2024 (_G/SG/N/10/IDN/27/Suppl.2, _G/SG/N/11/IDN/24/Suppl.2) provides that the safeguard measures are to be extended for three years from 20 August 2024. Had the safeguard measures on carpets and floor coverings been imposed after the duration of the initial safeguard measures (from 17 Feb 2021 to 16 Feb 2024) until 19 August 2024? If not, the safeguard duties applied from 20 August 2024 can in no way be construed as "extended" measures. If the measures had been applied until 19 August, what would be the legal basis for such measures? Please also explain the reason why the notification on the extended measures under Article 12.1(c) of the Agreement was so delayed?

Question 2

With respect to the Commodity Balance System ("Neraca Komoditas"), which Indonesia has implemented since 2022, it is still unclear what products are/will be covered. Please clarify what products will be subject to the system and the relevant timeframe. At the Commodity Balance Socialization held by Coordinating Ministry for Economic Affairs ("CME") on 19 September 2022, it was explained that the system covered 19 new items including steel, electric products and textile products, in addition to rice, sugar, beef, salt and fish, which were originally covered in Presidential Regulation 2022/32. On the other hand, we are also in contact with information that those 19 products are not covered under the system and we are confused by the conflicting information. We therefore request Indonesia to clearly identify what products are covered by this measure.

Question 3

With respect to the process of importing electric products, e.g. air-conditioners, laptop PCs, tablet computers and TV sets, MOT Regulation 36/2023 (effective 10 March 2024) required documents such as the "PI licence" and a technical consideration document ("Pertek") issued by the Ministry of Industry, in addition to the ordinary importer identification number (API) license. We are informed that subsequently, MOT Regulation 8/2024 (effective 17 May 2024) generally revoked the requirement to submit a Pertek document, but please update us with the list of products for which a Pertek document is still required, and for which it is not required (e.g. are Pertek documents still required for the import of air-conditioners (HS codes: 84.15)?). Moreover, the process of obtaining the PI license still takes time and the volume of imports approved is sometimes less than that of the application. What are the elements to be considered when issuing the PI license? How long is the standard examination period? Why is the approved import volume less than the volume that was applied for?

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