G/SG/N/8/IDN/17/Suppl.4  
G/SG/N/10/IDN/17/Suppl.4  
 
13 May  2022 
(22-3767) Page: 1/6 
Committee on Safeguards  Original: English  
 
NOTIFICATION UNDER ARTICLE 12.1(B) OF THE AGREEMENT ON SAFEGUARD ON  
FINDING A SERIOUS INJURY OR THREAT THEREOF  
CAUSED BY INCREASED IMPORTS  
NOTIFICATION OF A PROPOSAL TO EXTEND A MEASURE  
INDONESIA  
Supplement  
(I and H Sections of Other Alloy Steel)  
 
The following communication , dated  and received on 13 May  2022, is being circulated at the request 
of the delegation of Indonesia . 
 
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Pursuant to Article 7.2 and Article 12.1(b) of the WTO Agreement on Safeguards, the Government 
of the Republic of Indonesia hereinafter referred to as "GOI"  hereby notifies the Committee on 
Safeguards on the investigation findings concerning the extension of safeguard measures against 
the importation of "I and H Sections of Other Alloy Steel" under HS. Code Ex. 7228.70.10 and 
Ex. 7228.70.90 . 
A. GENERAL BACKGROUND  
1. Initiation of Investigation  
On 7 January 2021, The KPPI hereinafter referred to as the " Investigating Authority", received an 
application from PT. Gunung Raja Paksi Tbk., hereinafter referred to as the "Applicant", requesting 
for the extension of a safeguard measure on the importation of the Subject Goods based on the 
claim that the impositio n of a safeguard measure is still necessary for the domestic industries to 
prevent or remedy serious injury suffered by the Applicant and that the domestic industry is still 
undertaking the program of structural adjustment. Other known domestic industry, P T. Krakatau 
Wajatama, through a letter stating fully support the extension of safeguard measures so the 
domestic industry does not suffer further injury.  
The Investigating Authority initiated a safeguard investigation against importation of Subject Goods 
on 18 January 2021  (as announced in "Bisnis Indonesia" daily newspaper), and was notified to the 
WTO which had been circulated on 14 April 2022 (G/SG/N/6/IDN/25/Suppl.4/Corr.1).  
2. Major Proportion  
The total production of the Applicant is 97.7% of the total domestic production of the Subject Goods 
in Indonesia. Therefore, it represents a major proportion as required by Article 4.1(c) of the WTO 
Agreement on Safeguards.  G/SG/N/8/IDN/17/Suppl.4 • G/SG/N/10/IDN/17/Suppl.4  
 
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  Table 1. Major Proportion  
Companies  Proportion (%)  
PT. Gunung Raja Paksi, Tbk  97.7 
National Production  100 
3. Evidence and Views by Interested Parties  
In accordance with Article 3.1 of the WTO Agreement on Safeguards, during the process of 
investigation, the Investigating Authority has provided opportunities to all interested parties, to 
submit their views, evidence, comments, and responses concerning the investigation. In light of the 
aforementioned, a public hearing was held on 10 March 2021.  
4. The WTO document referring to the notification of initial extension of th e measure  
G/SG/N/6/IDN/25/Suppl.4/Corr.1  
5. The duration of the measure from initial application till the date at which it will be 
extended  
The duration of initial application of the safeguard measure until the date at which it will be extended 
is six years, the date of initial application of the safeguard measure is 21 January 2015 – 20 January 
2018 and the first extension of the safeguard measure is 21 January 2018 – 20 January 2021.  
6. Precise description of the product involved  
6.1  I Section with a height or a w idth of 100 mm up to 600 mm, and H Section with height 
100 mm up to 350 mm, of other alloy steel, not further worked than hot -rolled, hot -drawn, 
or extruded, under HS. Code ex. 7228.70.10; and  
6.2  I Section with a height or a width of 100 mm up to 600 mm, and H Section with height 
100 mm up to 350 mm, of other alloy steel, hot -rolled, hot -drawn, or extruded, and further 
worked, under HS. Code ex. 7228.70.90.  
7. Period of Investigation  
The period of investigation covers May 2017 to April 2020  
B. NOTIFICATION OTIFICATION UNDER ARTICLE 12.1(B) OF THE AGREEMENT ON 
SAFEGUARDS ON FINDING A SERIOUS INJURY OR THREAT THEREOF CAUSED BY 
INCREASED IMPORTS  
1. Information on absolute increase in imports  
Table 2. Volume of Imports  
Description  Unit Year 
Period I  
(May 2017 - April 
2018)  Period II  
(May 2018 - April 
2019)  Period III  
(May 2019 - April 
2020)  
Import 
quantities  Ton 18.934  32.499  23.242  
growth  % - 71,65  (28,48)  
Trend  % 10,79  
Source: Indonesian Statistic/ Badan Pusat Statistik (BPS).  
As shown in Table 2, imports increased in absolute terms with a trend of 10.79%. It is verified that 
the volume of imports increased significantly by 71.65% in period II (May 2018 - April 2019) 
compared to the previous period. Eventually, in period III (May 2019- April 2020)  the import of the G/SG/N/8/IDN/17/Suppl.4 • G/SG/N/10/IDN/17/Suppl.4  
 
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  subject goods decreased by 28.48% compared to the previous period, but this is still higher than 
the import quantities in the period I.  
2. Information on imports relative to the domestic production  
Table 3. Volume of Impo rts and Domestic Production  
Description  Unit Year  
Period I  
(May 2017 - April 
2018)  Period II  
(May 2018 - April 
2019)  Period III  
(May 2019 - April 
2020)  
Total Domestic 
Production  Index  100 86,93  62,71  
Import quantities  Ton 18.934  32.499  23.242  
Imports Relative to 
the Total of Domestic 
Production  Index  100 197,46  195,74  
Trend  % 39,91  
Source: Statistics Indonesia and as verified by Investigating Authority.  
As seen in Table 3 above, there was a surge increase in imports relative to the national production 
during the investigation period by a trend of 39.91%.  
3. Evidence of Serious Injury or Threat Thereof Caused by Increased Imports  
The Investigating Authority examined all data and information available based on the actual 
condition of the domestic industry. The Investigating Authority also conducted on -site verifications 
to the domestic industry. The following table 4 and table 5, contain data and information of the 
situation of the domestic industry, which is provided in indices.  
Table  4. Market Share of the Imports, Market Share of The Applicants and  
the non -Applicants  
Description  Unit Year  
Trend 
(%) Period I  
(May 2017 - 
April 2018)  Period II  
(May 2018 - 
April 2019)  Period III  
(May 2019 - 
April 2020)  
National Consumption  Index 100 84.16  78.18  (11.58)  
Market Share of Import  Index  100 203.96  157.02  25.31  
Market Share of the Applicant  Index  100 96.7 98.0 (1.02)  
Market Share of the Non -
Applicant  Index  100 55.7 86.6 (6.94)  
Source: as verified by the Investigating Authority.  
Based on table 3 above, National Consumption during the period of investigation decreased by a 
trend of 11.58%, which in period I to Period II decreased by 15.84%, and in period II to period III 
continued to decline by 7.10%. This table also sho ws that market share of the applicant, and 
non-applicant, decreased with a trend of 1.02% and 6.94% respectively while market share of 
imports significantly increased with a trend of 25.31%.  G/SG/N/8/IDN/17/Suppl.4 • G/SG/N/10/IDN/17/Suppl.4  
 
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  Table 5. The Applicant's Indicators of Injury  
Description  Unit Year  
Trend (%)  Period I  
(May 2017 - 
April 2018)  Period II  
(May 2018 - 
April 2019)  Period III  
(May 2019 - 
April 2020)  
Production  Index  100 87.24  62.82  (20.74)  
Domestic Sales  Index  100 81.37  76.58  (12,.49)  
Productivity  Index  100 115.87  83.91  (8.40)  
Utilization Capacity  Index  100 87.24  62.82  (20.74)  
Profit/Loss  Index  100 (8.51)  (77.02)  (92.58)  
Employment  Index  100 75.29  74.87  (13.47)  
Source: As verified by the Investigating Authority.  
As shown in the Table above, the performance of the applicant can be seen as follows:  
a. The production experienced a decrease during the period of investigation with a trend of 20.74% 
from 100 indexed points in period I to 87.24 indexed points in period II and decreased to 62.82 
indexed poi nts in period III.  
b. Domestic sales decreased with a trend of 12.49% during the period of investigation, from 
100 indexed points in period I to 81.37 indexed points in period II and then decreased again to 
76.58 indexed points in period III.  
c. Productivity i n period I was 100 indexed points, increased to 115.87 indexed points in period 
II, and in period III decrease to 83.91. During the period of investigation, the applicant 's 
productivity experienced a decrease with the trend of 8.40% because of the decline in the 
employment and the production.  
d. Utilization capacity experienced a decrease during the period of investigation with a trend of 
2.74%. This decrease was due to a decrease in production of the applicant.  
e. The applicant gained profit in period I but suff ered a financial loss during period II and period 
III which in line with the increase in imports. Moreover, the decline in domestic sales as a result 
of the increased imports also directly impacted the decline of the applicant 's profit during the 
period of investigation with a trend of 92.58% . 
4. Evidence that the Applicant is adjusting  
During the imposition of the safeguard measures, the Applicant has undertaken the following 
adjustment program:  
4.1 Purchased and installed light section mill machine  
4.2 Increased the capacity of the descaler pump in the roughing mill process  
4.3 Sold products with the franco method  
4.4 Provided a sale with the cut -to-length service.  
4.5 Expanded the Marketing Area  
4.6 Recertification of Indonesian National Standard  
4.7 Boosted Promo tion through national/international exhibitions, newspaper, magazines, and 
e-Commerce  
4.8 Improved the quality and quantity of Human Resources  
4.9 Reinforced the workforce. However, it did not optimally work due to the increase in imports 
in particular in period I and II.  
4.10  Maximized all production lines and increased the production capacity of the beam blank 
machine with the installation of a new beam blank caster machine in 2015. However, it did 
not optimally used due to the increase in import volume.  
4.11  Sold most o f the products from the inventory and reached the reasonable level of inventory 
on the period III by 36.85 index point. However, the production volume was keep 
decreasing due to the increase of import volume as shown on the table 6 below:  G/SG/N/8/IDN/17/Suppl.4 • G/SG/N/10/IDN/17/Suppl.4  
 
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  Table 6. The Appl icant's Production and Inventory  
 
Description  Unit Year 
Period I  
(May 2017 - April 
2018)  Period II  
(May 2018 - 
April 2019)  Period III  
(May 2019 - April 
2020)  
Production  Index 100 87.24  62.82  
Inventory  Index  100 124.62  36.85  
Source: as verified by the Investigating Authority.  
5. Causal Link  
a) There was an increase in imports of the product under investigation during the investigation 
period, both in absolute terms (10.79%) and relative (39.91%).  
b) Market share of Imports during the investigation period experienced an increasing trend of 
25.31%. This resulted in a decline in the market share of Applicant and Non -Applicant with a 
trend of 1.02% and 6.94%.  
c) There was a downward trend in performance indicators during the investigation per iod, namely 
a decrease in the number of productions, domestic sales, profits, capacity utilization, 
employment and productivity.  
6. Evidence that the safeguard measure continues to be necessary to prevent or remedy 
serious injury  
a) Even though the safeguard mea sure has been imposed on the product under investigation, in 
fact, the volume of imports is still increasing both in absolute and relative terms. Import volume 
is expected to remain significantly increase if the safeguard measures are not extended;  
b) The Ap plicant has carried out the structural adjustment program as previously committed in 
the first extension of the investigation. However, the Applicant still needs additional time to 
complete the structural adjustment to its optimal level. This is considered  necessary so that the 
Applicant can be more ready to compete with imported goods in the future;  
c) During the investigation period, it has been proven that there was a causal link between increase 
in the import of the product under investigation and the serious injury experienced by the 
Applicant. The investigating authority therefore concluded that if the imposition of the safeguard 
measures was not extended, it would hamper the recovery of the applicant's performance.  
C. NOTIFICATION OF A PROPOSAL TO EXTEN D A MEASURE  
Proposed date of introduction of the measure  
In a view of section B above, the investigation authority has proposed to extend the imposition of 
the safeguard measures on the importation of products under investigation.  
The proposed safeguard me asure to be imposed is now being circulated for inputs from relevant  
government agencies, and will be elaborated in the notification under the Article 12.1(c) of the  WTO 
Agreement on Safeguards.  
The imposition of the safeguard measures will be carried out in accordance with Article 2.2 and 
Article 9 of the WTO Agreement on Safeguards. The non -confidential version of the Final Report of 
this investigation, can be found on the website of the Indonesian Safeguard Committee: 
http://kppi.kemendag.go.id .  
In a view of the aforementioned findings, the safeguard measures have been proposed in a form of 
ad valorem duty with expected duration as follows:  G/SG/N/8/IDN/17/Suppl.4 • G/SG/N/10/IDN/17/Suppl.4  
 
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  Table 7. Safeguard Measures  
Period  Safeguard Measures  
Year 1  17.00 %  
Year 2  16.75 %  
Year 3  16.50 %  
D. CONSULTATIONS  
Members having a substantial interest as exporters of the Subject Goods should submit a written 
request within a period of 7 days from the date of circulation of this notification. All written requests 
must be sent both in a written letter and in electronic format, and must indicate the name, address, 
email address, phone and fax number of the Members. In Accordance with article 12.3 WTO 
Agreement on Safeguards, the Government of the Republic of Indonesia is open for consultation in 
order to provide opportunities for those Members. The consultation is scheduled to be held no later 
than 3 June 2022. The contact information for correspondence is:  
DIRECTORATE OF MULTILATERAL NEGOTIATION, MINISTRY OF TRADE  
Jl. M.I . Ridwan Rais No.5, Building 2, 9th floor, Jakarta 10110  
Phone: (62 -21) 3840139  
Fax: (62 -21) 3840139  
E-mail: dit.multilateral.ppi@kemendag.go.id   
 
 
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