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Revocation and Replacement of Minister of Trade Regulation on Import of Finished Goods and the...

May 2012 - Corporate & Commercial. Legal Developments by Lubis Ganie Surowidjojo .

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Issuance of Licensed Importer Numbers

Minister of Trade Regulation No. 39/M-DAG/PER/10/2010 on Import of Finished Goods by Manufacturers (“MoTR No. 39/2010”) has been revoked by the issuance of Minister of Trade Regulation No. 24/M-DAG/PER/4/2012 on 30 April 2012. 

This revocation was made as instructed by Supreme Court Decision No. 19P/HUM/2011 in June 2011. For the certainty of law, Minister of Trade Regulation No. 27/M-DAG/PER/5/2012 on Licensed Importer Numbers was then issued on 1May 2012 (“MoTR No.27/2012”). It also replaces the previous regulation on Licensed Importer Numbers (Minister of Trade regulation No. 20/M-DAG/PER/7/2011).

Previously, under MoTR No. 39/2010, manufacturers were allowed to import finished products which were not intended to be used in their production process. It indirectly allowed manufacturers to undergo trading of such imported goods in a manner that can generally only be carried out by a holder of a General Licensed Importer Number (Angka Pengenal Importir Umum/”API-U”). However, the new regulation (MoTR No.27/2012) expressly sets out that goods imported by the holder of Producer Licensed Importer Number (Angka Pengenal Importir Produsen/”API-P”) are prohibited from being traded or transferred. Nevertheless, an exemption, with certain restrictions, is provided to the holders of API-P to trade and or transfer certain imported industrial goods.

According to Article 6 of MoTR No.27/2012, the holder of API-P can import certain industrial goods as long as necessary for the development of its business and investment. Certain industrial goods are allowed to be traded or transferred if they are (i) not being used in the process of production and (ii) only purposed for a test market and/or as complementary goods. Furthermore, according to Article 7, the applicable requirements for a test market purpose are (i) the imported goods are not yet produced by the holder of API-P and (ii) are in accordance with the business license of the holder of the API-P. Such requirements also apply to complimentary goods, but with the addition requirement that the imported goods shall be produced by a company located abroad which has a special relationship (hubungan istimewa) with the company holding the API-P. The import for a test market is limited to a certain period. The period is determined by respective technical agencies in accordance with applicable law and regulations (Article 8).

Prior to importing certain tradable and transferable industrial goods, the holder of API-P has to be determined as a producer importer by filing an application to Directorate General of Foreign Trade (“Directorate General”) along with the required documents as set out in Article 11. Recommendation from related agencies as one of the requirements regarded as the key point in obtaining such a determination. The determination will be issued no later than 5 (five) days from the receipt of the complete and correct documents.

MoTR No.27/2012 states that an importer can only have one kind of Licensed Importer’s Number (Angka Pengenal Importir/”API”) (Article 14). It applies as long as the importer continues to undertake its business and has to be re-registered every five years as of the date of its issuance. APIs are issued by the Minister of Trade, who can delegated the issuance to (i) Head of Investment Coordinating Board to issue both API-U and API-P (for investor whose business license is issued by the Investment Coordinating Board (“BKPM”)), (ii) Directorate General to issue API-P (for business entity or contractor in the field of energy, oil and gas, mineral as well as other natural resources under a cooperation agreement with the government), (iii) Head of Province Office to issue API-U and API-P (for other than those under the authorization of BKPM and Directorate General) and (iv) Head of Business Board to issue API (for company, business entity or contractor established and domiciled in a Free Trade Zone or a Free Port). All or part of such delegated authorizations may be withdrawn by the Minister under conditions as set out under Article 21 (3).  Application shall be made by filling out a form as enclosed within MoTR No.27/2012 (enclosure I, II, and III) along with all required documents.

The holder of API-P determined as a Producer Importer is obligated to report realization of import every 3 (three) months to the Directorate General (Article 29). This also applies to the holder of API-U and API-P with respect to the agencies that issued the license. Any data changes related with API-U and API-P shall be reported by filing a form as enclosed within MoTR No.27/2012 (enclosure XII). Sanctions from suspension to revocation of API-U and API-P will be imposed should the holder of those licenses fail to fulfill their obligations under MoTR No.27/2012.

According to Article 42, API-U and API-P issued under the previous regulations (Minister of Trading Regulation No. 45/M-DAG/PER/9/2009 as amended by Minister of Trading Regulation No. 20/M-DAG/PER/7/2011) shall be adjusted with MoTR No.27/2012 no later than 31 December 2012.

Source: Minister of Trade Regulation No. 27/M-DAG/PER/5/2012 on Licensed Importer Numbers

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