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Indonesia Strengthens Post Border Import Trade System

The Indonesian government aims to strengthen oversight of the import trade system outside the customs area (post border) with an intensive inter-ministerial data and information exchange mechanism - Photo by trade ministry.

JAKARTA (TheInsiderStories) – The Indonesian government aims to strengthen oversight of the import trade system outside the customs area (post border) with an intensive inter-ministerial data and information exchange mechanism. The mechanism was stated in a memorandum of understanding (MoU) signed by the finance and trade ministry on Wednesday (12/18).

“The MoU is aimed at improving the coordination of data and information exchange profiles of business operators and objects of import trade control that have been analyzed by the Indonesia Single Risk Management (ISRM),” said trade minister Agus Suparmanto in Jakarta, stressing the move to strengthen the import trading system supervision outside the customs area and the utilization of the technical laboratory of the director-general of customs and excise.

Suparmanto revealed the government has resolved trade management issues to boost the country’s export-import activities. One of which is by shifting from the border (custom territory) to post border (outside customs area). The shift to the post border does not eliminate the import requirements, but the supervision previously made by the customs and excise is transferred to the ministry or institution.

Suparmanto explained that post border supervision is a mechanism for supervising the import trade system which begins with the inspection of the suitability of import licenses owned by business actors issued by the finance ministry and is carried out after the goods leave the customs area.

“The policy is expected to accelerate the process of releasing goods from customs areas, especially for industrial raw materials so that they can support domestic industrial processes which ultimately provide ease of business and investment,” the minister hoped.

Criteria of goods still being checked in customs areas related to security, health, and environmental safety, Heru Pambudi, director-general of customs and excise. From the total HS Code of 10,826 HS Code, currently, goods are still subject to a prohibition and restriction of 48.3 percent or 5229 HS Code. This amount is expected to fall to 20.8 percent or 2256 HS Code in the border.

“The customs and excise keep doing a physical inspection, the examination of tariff and customs value to ensure the determination of its tariff. This arrangement is expected to support the domestic investment climate, reduce dwelling time, logistics costs,” Pambudi said.

Pambudi said his office will continue to coordinate with trade ministry to ensure HS Code for both customs and non-customs areas. The office also continues to conduct coordination meetings for the preparation of post border implementation with the Indonesia National Single Window (INSW) and the institutions under the Coordinating Ministry for the Economy Affair, he adds.

Moreover, post border supervision tightens the entry of imported goods so as to provide guarantees and legal certainty for businesses and provide guarantees for Indonesian consumers to get quality goods in accordance with the required standards, said Veri Anggrijono, director-general of consumer protection and orderly commerce.

“It is also necessary to supervise circulating goods that do not have a permit and quality certificate for products that have been subjected to Indonesian national standard,” Anggrijono said.

Until the second semester of 2019, his office has destroyed Rp15 billion (US$1.07 million) in goods that violated the provisions of the legislation, such as not having a permit for trading activities, and not having a quality certificate for a product that had been subjected to Indonesian national standard, he said.

The items destroyed were luminaires, water pumps, forestry products, hand tools, flour, cables, refrigeration machines, used clothing, fabric printing, inner tires, and other products.

US$1=Rp14,000

Written by Lexy Nantu, Email: lexy@theinsiderstories.com