G/SG/N/8/IDN/26  
G/SG/N/10/IDN/26  
 
19 May 2020  
(20-3709) Page: 1/6 
Committee on Safeguards  Original: English  
 
NOTIFICATION UNDER A RTICLE 12.1(B) OF TH E AGREEMENT ON  
SAFEGUARDS ON FINDIN G A SERIOUS INJURY O R THREAT   
THEREOF CAUSED BY IN CREASED IMPORTS  
NOTIFICATION OF A PR OPOSAL TO IMPOSE A M EASURE  
INDONESIA  
Fructose Syrup  
The following communication, dated 1 8 May 2020, is being circulated at the request of the delegation 
of Indonesia.  
 
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Pursuant to Article 12.1(b) of the WTO Agreement on Safeguards, the Government of the Republic 
of Indonesia, hereinafter referred as "GOI", hereby notifies to the Committee on Safeguards on its 
findings of serious injury or threat thereof caused by the increased imports.  
GENERAL BACKGROUND  
1  INITIATION OF INVEST IGATION  
On 28 October 2019, KPPI (Komite Pengamanan Perdagangan Indonesia/Indonesian Safeguards 
Committe e) hereinafter referred as the "Investigating Authority ", received an application from 
PT. Associated British Budi (PT. ABB) hereinafter referred as the Applicant, requested for the 
imposition of a safeguard measure on the importations of Fructose Syrup un der HS. Code 
1702.60.20.  
Based on the examination of the above -mentioned application, the investigating authority initiated 
a safeguard investigation on 13 November 2019. The initiation of the investigation was published in 
the national daily newspaper ( "Bisnis Indonesia "), and Ministry of Trade website. The said initiation 
was also notified in the WTO document G/SG/N/6/IDN/34, circulated on 15 November 2019.  
1. Period of Investigation  
The period of investigation covers 2015 to 2018 . 
2. Major Proportion  
The total  production of the Applicant is 54% from total domestic production of the Subject Goods, 
therefore it represents a major proportion as required by Article 4.1(c) of the WTO Agreement on 
Safeguards.  
3. Views and Comments of the 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 G/SG/N/8/IDN/26 • G/SG/N/10/IDN/26  
 
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  submit their views, evidences, comments, and responses concerning t he investigation. In light of 
the aforementioned, the Investigating Authority has held a public hearing on 10 December 2019.  
2  INFORMATION ON WHETH ER THERE IS AN ABSOL UTE INCREASE IN IMPO RTS OR AN 
INCREASE IN IMPORTS RELATIVE TO DOMESTIC  PRODUCTION  
In the li ght to provide evidence whether there is an absolute increase in imports or an increase in 
imports relative to domestic production, the Investigating Authority has analyzed import data of the 
Subject Goods during the period of investigation.  
1. Absolute incre ase in imports  
Table 1. Volume of Imports  
Description  Unit Year  
2015  2016  2017  2018  
Volume of Imports HS. 
1702.60.20  Ton 67,244  106,566  138,997  109,884  
Growth  %  58.48  30.43  (20.95)  
Trend (2015 -2018)  % 18.99  
Source:  Statistics Indonesia/ Badan Pusat Statistik  (BPS)  
It can be seen from the Table 1, import volume of the Subject Goods increased in absolute terms 
with a trend of 18.99%, during the period of investigation. The volume of imports was increase from 
2015 to 2017, with the biggest i ncrease in 2017 with a growth of 30.43%. Although the volume of 
imports dropped slightly to 109,884 tons in 2018, but the amount is greater than volume of imports 
in 2015 and 2016.  
2. Relative increase in imports to Total Domestic Production  
Table 2. Volume o f Imports, Total Domestic Production, and Relative to Total Domestic 
Production  
Description  Unit Year  
2015  2016  2017  2018  
Volume of Imports HS. 
HS. 1702.60.20  Ton 67,244  106,566  138,997  109,884  
Total Domestic 
Production  Index  100 101 69 66 
Imports Relative to Total 
Domestic Production  Index  100 158 299 246 
Trend (2015 -2018)  % 39.62  
Source:  Statistics Indonesia and as verified by Investigating Authority  
Based on the Table 2, imports relative to domestic production have also increased significantly with 
a trend of 39.62%. It increased sharply from 100 index point in 2015 to 158 and 299 index point in 
2016 and 2017 respectively. Although the imports relative were dropped slightly to 246 index point 
in 2018 compared to previous year, but the amount is more than the imports relative in 2015 and 
2016.  
3. Imports from Main Countries  
Table 3. Imports Shares  
Country  Unit Year  
2015  2016  2017  2018  
People 's Republic of China (PRC)  % 70.18  91.69  98.06  94.01  
Philippine  % 1.40 0.17 0.00 5.22 
Others  % 28.41  8.15 1.94 0.77 
Total % 100 100 100 100 
Source:  Statistics Indonesia/ Badan Pusat Statistik  (BPS)  G/SG/N/8/IDN/26 • G/SG/N/10/IDN/26  
 
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  From the Table 3, the biggest shares of import from 2015 to 2018 in the domestic market was PRC, 
which its shares of import in 2018 accounted for 94.01%. Other country that has share of imports 
above 3% during the period of investigation is Philippines, which its shares of import in 2018 was 
5.22%.  
3  EVIDENCE OF SERIOUS INJURY OR THREAT THE REOF CAUSED BY INCRE ASED IMPORTS  
In a view to determine the existence of serious injury or threat of serious injury that is caused by 
increased imports, the Investigating Authority has analyzed and made an evaluation of all relevant 
factors in objective and quantifiable natures. The following analy ses are based on data provided by 
the Applicant, which has been verified by the Investigating Authority.  
1. Evidence of serious injury or threat of serious injury  
Table 4. National Consumption, Volume of Imports, and Market Shares  
No. Description  Unit Year  Trend  
2015 -
2018 
(%) 2015  2016  2017  2018  
1. National Consumption  Index  100 144 166 136 11.07  
2. Volume of Imports  Ton 67,244  106,566  138,997  109,884  18.99  
3. Applicant 's Domestic 
Sales  Index  100 98 74 68 (13.33)  
4. Non-Applicant 's Domestic 
Sales  Index  100 144 82 88 (9.06)  
5. Imports ' market share  Index  100 110 125 121 7.13 
6. Applicant 's market share  Index  100 68 45 50 (21.97)  
7. Non-Applicant 's market 
share  Index  100 100 50 65 (18.12)  
Source:  Statistics Indonesia and as verified by the Investigating Authority  
a) It can be seen from Table 4 that national consumption of the subject goods increased 
during the investigation period with a trend of 11.07%. However, the increased of national 
consumption in that period could not be utilized by the Domestic Industries.  
b) The Applicant 's domestic sales declined in a trend of 13.33% during the investigation 
period due to the pressure of imports.  
Table 5. The Applicant 's Indicators of Performance  
No Description  Unit Year  Trend  
2015 -
2018 
(%) 2015  2016  2017  2018  
1. Production  Index  100 98 74 68 (13.33)  
2. Domestic Sales  Index  100 98 74 68 (13.33)  
3. Productivity  Index  100 100 76 82 (8.26)  
4. Installed Capacity  Index  100 100 100 100 - 
5. Capacity Utilization  Index  100 98 74 68 (13.33)  
6. Profit/Losses  Index  100 86 79 (69) (91.64)  
7. Employment  Index  100 98 98 83 (5.53)  
Source:  As verified by the Investigating Authority  
As shown in Table 5, the performance of the applicant can be seen as follows:  
a) The Applicant 's domestic sales decreased with a trend of 13.33%. The decrease in 
sales will affect its production in a negative direction. This was what happened during 
the investigation period, wherein Applicant 's domestic sales and production had the 
same pattern of tre nd (negative trend).  G/SG/N/8/IDN/26 • G/SG/N/10/IDN/26  
 
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  b) The decreased of Applicant 's production during the period of investigation has an 
impact on productivity in the same period, the applicant production decreasing by 
13.33%. In addition to that, the decreased of the production forced the  Applicant to 
reduce the number of its employees in 2016 and 2018.  
c) Although the Applicant 's capacity utilization decreased during the period of 
investigation, the capacity utilization in period of 2017 -2018 were decreased into 
lower point than in 2015, whi ch made negative trend of Applicant 's capacity utilization 
during the period of investigation.  
d) During the investigation period, The Applicant suffered some losses with a trend of 
91.64%. Besides, the increase of imports had forced the Applicant to sell its  product 
under cost of production.  
2. Other Factors That May Contribute to Injury  
In order to ensure that the serious injury is only caused by increased imports, the Investigating 
Authority has examined the following other known factors:  
a) Exports sales  
Table 6. The Applicant Sales  
No Description  Unit Year  
2015  2016  2017  2018  
1. Total Sales  Index  100 100 100 100 
2. Domestic Sales  Index  98.89  99.99  100 100 
3. Exports Sales  Index  1.11 0.01 0 0 
Source:  As verified by the Investigating Authority  
It can be seen from Table 6 that the applicant had export sales with a very small in number and 
continue to decrease. In 2017 and 2018 the applicant did not even have export sales. Based on 
these data, export sales were not affected to their inju ry. 
b) Technology  
Based on the result of the investigation, the applicant has the latest technology in producing fructose 
syrup that is similar to the product being investigated. This is supported by the fact that the machine 
is able to provide fructose sy rup with the latest technology.  
c) Competition Between Domestic Industries  
Table 7. Import Market share, Applicant, and non -Applicant Market share  
No. Description  Unit Year  Trend  
2015 -
2018 
(%) 2015  2016  2017  2018  
1. Imports market share  index  100 110 125 121 7.13 
2. Applicant's market 
share  index  100 68 45 50 (21.97)  
3. Non-Applicant's 
market share  index  100 100 50 65 (18.12)  
Source:  Statistics Indonesia and as verified by Investigating Authority  
It can be seen from the table above that during the period of investigation both the Non applicant 's 
market share and the applicant 's market share decreased. This circumstance indicated that there 
was no competition between domestic industries (either the Applicant or Non -Applicant), which were 
causing injury during the investigation period unless caused by imports.  G/SG/N/8/IDN/26 • G/SG/N/10/IDN/26  
 
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  Based on the facts above, it can be concluded that during the period of investigation there were no 
other factors that caused serious injury to the Applicant besides an increased volum e of imports of 
the Subject Goods.  
3. Causal Link  
The Investigating Authority has examined all relevant factors having a bearing in the Applicant 
situation, and came into a conclusion that serious injury suffered by the Applicant mainly caused by 
significant increased volume of imports and not due to the other factors, as follows:  
a) There was an increase of imports of the Subject Goods in absolute terms, during 
investigation period as shown in Table 1.  
b) The share of imports increased with a trend of 7 .13% in the domestic market throughout 
the period of investigation. On the other hand, the Applicant 's market shares decreased 
with a trend of 21.97%, during the same period.  
c) During investigation period, there were negative trends in the Applicant 's perfor mances, 
such as production, domestic sales, productivity, capacity utilization, profit/losses and 
employment. Moreover, the Applicant 's financial losses showed an increasing trend, with 
a trend of 91.64%, which showed overall impairment in the Applicant 's performance or 
serious injury suffered by the Applicant.  
d) Based on analysis on 3.2, it can be concluded that there were no factors other than 
increased imports, which were causing the decrease on the Applicant 's performances.  
Based on the conditions above, the Investigating Authority has examined all relevant factors in 
accordance with the Agreement on Safeguards, Article 4.1 and 4.2, and it can be concluded that the 
increased imports have caused a serious injury on the Applicant or domestic industries. No f actors 
other than increased imports, which has caused injury to the domestic industries.  
4  UNFORESEEN DEVELOPME NT 
There were increased imports during the investigation period due to a shift in preference from 
domestic consumers on fructose syrup. The downstr eam fructose syrup industry, the food and 
beverage industry, changed the use of raw materials which initially using industrial sugar to using 
fructose syrup. The shift in preference was indicated by the increasing number of national 
consumptions of fructos e syrup in 2017 compared to the previous year which increased by 14.81%. 
While the national consumptions of industrial sugar in 2017 decreased by 3.33% sourced from The 
Ministry of Agriculture of Republic of Indonesia. The increase in national consumptions  of fructose 
syrup was due to the growth of the beverage industry which reached a growth rate of 7% in 2017. 
Therefore, the increase in the number of imported fructose syrup in Indonesia was caused by the 
changes in consumer preferences in Indonesia that p reviously used industrial raw sugar and change 
it to fructose syrup as the raw material.  Fructose syrup is considered more practical and efficient for 
producing food and beverages. The changes in consumer preferences in Indonesia could not be 
predicted and  anticipated before (unforeseen/unexpected).  
5  DESCRIPTION OF THE P ROPOSED SUBJECT GOOD S 
The description of the Subject Goods under Article 12.1(a) (WTO document G/SG/N/6/IDN/34), the 
product that is proposed to be imposed by safeguard measure is "Fructose Syrup under HS code 
1702.60.20 "  G/SG/N/8/IDN/26 • G/SG/N/10/IDN/26  
 
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  6  DESCRIPTION OF THE P ROPOSED MEASURE  
In a view of the aforementioned findings, a safeguard measure has been proposed in form of 
ad valorem  tariff duty:  
Table 8. The Proposed Safeguard Measure  
Year  Measure (%)  
Year 1  24 
Year 2  22 
Year 3  20 
In a view of the aforementioned conclusion of the causal link, the Investigating Authority has 
proposed to the Government of the Republic of Indonesia to impose a safeguard measure on the 
importation of the Subject Goods fo r a period of three years.  
The non -confidential version of the Final Report of this investigation, can be found in the website of 
the Indonesian Safeguard Committee:  www.kppi.kemendag.go.id . 
7  PROVIDE PROPOSED D ATE OF THE APPLICATI ON OF THE MEASURE  
A safeguard measure is proposed to enter into force after the publication of the decree of the Minister 
of Finance of the Republic of Indonesia, which will be promulgated at the Official Gazette  
8  CONSULTATIONS  
Members who have a substantial interest of the Subject Goods, shall submit a written request of 
consultation within a period of 7 days from the date of circulation of this notification. All written 
requests must be sent both in written letter  and in electronic format, and must indicate the name, 
address, e -mail address, phone and fax number of the Members.  
In Accordance with Article 12.3 WTO Agreement on Safeguard, the Government of the Republic of 
Indonesia will conduct consultation in order to provide opportunities for those Members, consultation 
is scheduled to be held no later than 8 June 2020.  
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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