Improving Business Ease, Ministry of Trade Shifts Import Supervision From Border To Post Border
As of early 2018, the Ministry of Trade of the Republic Indonesia issued several amendments of import regulations as well as new regulations. Following the issuance of these regulations, the Directorate of Customs and Excise (“Customs”) issued Circular Letter No. S-145/BC/2018 dated 7 February 2018 on Implementation of Post-Border Import Supervision on Certain Imported Goods that are Subject to Restriction.
The amendments or changes are aimed at reducing the dwelling time at the Port and to improve business process and competitiveness of domestic logistics providers – as a part of President Jokowi’s Economic Policy Package Phase XV.
What are the changes
The main thrust of the changes is to shift the import supervision of prohibited goods and/or restricted goods (goods that are subject to Larangan dan Pembatasan Impor or “Lartas” 1 ) away from Customs at the entry point (“Border”). Now the supervision will be done by the relevant Ministry or Institution – after the goods exit the customs territory or pass the Border ("Post-Border") thereafter referred to as “Post-Border Import Supervision Policy”.
In brief, the Government does not aim to remove the additional import requirements or lartas but they just want to change the responsible supervisor of the fulfilment of lartas from Customs to the relevant Ministry or Institution (eg, Ministry of Trade, Food and Drug Control Agency/BPOM). As such, additional import requirements or lartas are no longer applied at the time of customs clearance process at the Port. The lartas are required after the goods are cleared or exit the Customs Port.
To implement the policy and to provide a reliable and updated information source to the public, the Indonesia National Single Window Portal Management (“PP INSW”) has made some adjustments, eg, to remove restricted imported goods that are supervised at post-border from the list of goods that are subject to lartas. The updated information on post-border and list of goods that are still supervised at the border can be accessed through the website http://eservice.insw.go.id/
For example, importation of cosmetics products is now subject to post-border inspection (please see below screen shot of the PP INSW).
Imposition of sanctions for violation of the post-border import trading supervision requirements/permits will be in accordance with applicable laws and regulations, such as:
Suspension of Import Identification Number ("API")
Revocation of API
Suspension of additional import license (ie, Import Approval)
Revocation of additional import license (ie, Import Approval)
Conclusion - Impact for Importers
With the issuance of these regulations, importers currently have to provide the necessary import documents or lartas documents at the post-border (outside Customs Port/Territory). However, before the goods can be used, traded and/or transferred, they must provide a self-declared statement letter to the relevant Ministry/Institution which mentions that they comply with the import provisions and indicating the Import Declaration ("PIB") number.
Further, importers must keep the lartas documents for 5 years for the purpose of supervision and examination by the relevant Ministry/Institution. The issue is that not all relevant; Ministries/Institutions have activated their self-declaration systems and we expect to see hiccups in the next month or two.