On December 11, 2023, the Indonesian Minister of Trade (“MoT”) issued a new regulation that introduces substantial changes to import policies and arrangements, with the stated aim of clarifying and improving import procedures in Indonesia.
The new regulation, MoT Regulation No. 36 of 2023 on Import Policies and Arrangements (“Regulation 36/2023”), is effective as of March 10, 2024 (except for as it concerns the import of used goods from Indonesian migrant workers, in which case the regulation is effective immediately).
Regulation 36/2023 revokes MoT Regulation No. 20 of 2021 on Import Policies and Arrangements as amended by MoT Regulation No. 25 of 2022 (“Regulation 20/2021”). Some of the key provisions from that earlier regulation remain in place under Regulation 36/2023, including the applicability of a Business Identification Number (Nomor Induk Berusaha or “NIB”) as an Importer Identification Number (Angka Pengenal Importir or “API”), and the requirement that importers secure business licensing in the form of a Registered Importer, Producer Importer, and/or Import Approval.
This article focuses on notable changes introduced by Regulation 36/2023.
New API Provisions
Regulation 36/2023 introduces a procedure to change an NIB that has been registered as an API-U (API Umum, for the import of goods for trading or transfer purposes) to an API-P (API Produsen, for the import of goods utilized for own purposes as capital goods), on the condition that the importer holding business licensing and/or a surveyor report has realized all its imports and their NIB has been effective for at least one year. It is important to note that importers can still sell or transfer goods already imported under their API-U after it is changed to an API-P.
Regulation 36/2023 provides that only head offices can hold an API, but the API can be used by branch offices in the same line of business. This aligns with Government Regulation No. 5 of 2021 concerning the Implementation of Risk-Based Business Licensing, which does not require branch offices to have a separate API.
Finally, Regulation 36/2023 expands the list of imported goods that can be sold or transferred to other parties even if imported under an API-P. The new regulation adds capital goods imported in new condition but have been used for at least two years; goods that are sold or transferred by the holders of oil and gas processing licenses or oil and gas trading licenses; and goods manufactured as complementary goods for the purpose of market testing and/or after-sales services.
New import Business Licensing Provisions
The previous regulation’s 30-day time limit for changing data for import Business Licenses through the Indonesia National Single Window System (Sistem Indonesia National Single Window or “SINSW”) is eliminated. Rather, changes involving the harmonized system or the number of goods and units of goods must be made (i) before import realization or when import realization is not being done and/or (ii) before a surveyor report is issued.
Provisions on the renewal of a Registered Importer or Producer Importer in Regulation 20/2021 have been revoked. Instead, Regulation 36/2023 sets forth the procedure for the renewal of Import Approval.
Finally, the provisions on the cancellation or revocation of import business licensing have been made more open-ended compared to the more exhaustive criteria under Regulation 20/2021. Under the new regulation, cancellation or revocation can be done if there are faults in relation to the authority, procedure and/or substance of the import business licensing.
New Import Regulation: Exceptions, Exemptions and Provisions
Two new exceptions have been added to the restriction on the import of used goods. The first being goods in the form of scrap (sisa, skrap or reja) that are not classified as hazardous or toxic waste and are needed as raw materials and/or industrial auxiliaries, and the second being other goods imported for specific purposes.
Goods entering a Special Economic Zone (Kawasan Ekonomi Khusus) are now also excluded from the imposition of import policies and arrangements, joining (i) goods entering Bonded Stockpiling Areas (Tempat Penimbunan Berikat or “TPB”); (ii) goods entering a Free Trade Zone and Free Port (Kawasan Perdagangan Bebas dan Pelabuhan Bebas or “KPBPB”) from outside the customs area; and (iii) goods or materials imported to be processed, assembled, or installed for export. This exclusion does not apply to goods that must be inspected for customer safety or security, safety, health, and environment purposes. Aside from these exceptions, there is no longer an exhaustive list of goods that are excluded from the imposition of import policies and arrangements, which is a change from Regulation 20/2021.
Regulation 36/2023 introduces provisions on the import requirements for both free import goods and import restricted goods. Notably, free import goods can be defined as goods for which there is no import limit and which can be imported simply by providing (i) an NIB that applies as an API and (ii) shipment documents for customs clearance. Import restricted goods are defined as goods requiring approval from related government institutions or goods that require documents other than an NIB and shipment documents to be imported.
Regulation 36/2023 exhaustively lists 18 categories of free import goods, including temporary imported goods, promotional goods, goods for scientific research and development purposes, and goods for overseas exhibition purposes that are re-imported in a quantity that is at a maximum equal to the quantity when exported. These goods can notably be imported without the importer having to obtain an NIB that applies as an API when such imports are not for business activities and when there is a Statement Letter from the Directorate General of Foreign Trade at the Ministry of Trade approving the exemption. The NIB exemption, however, does not apply for free import goods imported for business activities.
There are provisions for import restricted goods that are imported for business activities and import restricted goods not imported for business activities. For import restricted goods for business activities, importers must obtain an NIB that applies as an API but may be exempted from (i) import business licensing, (ii) verification or technical search, and/or (iii) destination port restrictions. Goods that fall under this exemption are listed in Appendix VI of Regulation 36/2023.
Imports of restricted goods not for business activities can either be additionally exempted from the obligation to obtain an NIB that applies as an API if the goods are listed in Appendix IV, or only exempted from (i) the obligation to obtain import business licensing, (ii) verification or technical search, and/or (iii) destination port restrictions if the goods are listed in Appendix V. All these exemptions are subject to the issuance of a Statement Letter from the Director General of Foreign Trade at the Ministry of Trade approving the exemption.
Regulation 36/2023 also introduces a specific provision on the possibility of importing restricted goods without (i) NIB that applies as API, (ii) import Business Licensing, (iii) verification or technical search, and/or (iv) destination port restrictions, in case the goods are used goods that are shipped by Indonesian migrant workers.
Regulation 36/2023 regulates temporary imports of goods which suffer serious damage during use and are to be re-exported. Provisions on the import of complementary goods and goods for market tests or after-sales purposes are also changed. In the past, as long as the goods were used for the aforementioned purposes, the goods required an Import Approval. Now, complementary goods and goods for market tests or after-sales purposes that fall under the category of free import goods only require a Statement Letter from the Director General of Foreign Trade approving the import.
In the appendix of the regulation, there is also a change regarding the requirement to obtain an Import Approval whereby the Commodity Balance is now the only requirement for goods listed therein.
New Import Realization Report Provisions
Aside from the usual import realization report instruction, Regulation 36/2023 additionally clarifies the reporting duties of importers with more than one import business licensing reporting obligation due to the type of goods they import. The reporting obligations are as follows:
| parties obliged to report under: Registered Importer,Producer Importer, Import Approval, andSurveyor Report | parties obliged to report under: Registered Importer,Producer Importer, andImport Approval | parties obliged to report under: Registered Importer,Producer Importer, andSurveyor Report | parties obliged to report under: Import Approval, andSurveyor Report |
| only need to provide a report for the import Business License in the form of Import Approval. | only need to provide a report for the import Business License in the form of Import Approval. | only need to provide a report for the import Business License in the form of Registered Importer or Producer Importer. | only need to provide a report for the import Business License in the form of Import Approval. |
Transition Provision
Importers whose business licensing requirements or free import good status has changed under Regulation 36/2023 should ensure that their imports enter Indonesia by March 9, 2024.
Conclusion
The changes to import policies and arrangements made by Regulation 36/2023 are substantial. While most concern procedural clarifications, such as how an API-U can be changed to an API-P or the kind of import realization report to submit when an importer holds multiple import business licensing, there are some notable changes. These include the addition of goods that can be traded or transferred even when imported under an API-P, the addition of exceptions to the restriction on importing used goods, and the elimination of the list of goods under Regulation 20/2021 fully exempted from import policies and arrangements.
Regulation 36/2023 mostly aims to clarify and improve import procedures in Indonesia and to make it easier for importers to do business by providing exemptions on import requirements.
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