G/TRIMS/W/160  
 
27 April 2015  
(15-2225)  Page: 1/2  
Committee on Trade-Related Investment Measures  Original: English  
 
 INDONESIA – CERTAIN MEASURES ADDRESSING LOCAL CONTENT  
IN INVESTMENT IN THE TE LECOMMUNICATIONS SECTOR 
REPLIES TO QUESTIONS FROM JAPAN1 
The following communication, dated 15 April 2015, is being circulated at the request of the 
Delegation of Indonesia.  
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 We refer to Japan's questions contained in document G/TRIMS/W/154 dated 13 April 2015, 
Indonesia hereby wishes to provide the following clarifications:  
 Question 1 
 
Article II of TRIMS Agreement draws the provision of Article III of GATT, and 
paragraph 4 of Article III of GATT stipulates that the products of the territory of any 
contracting party imported into the territory of any other contracting party shall be 
accorded treatment no less favourable than th at accorded to like products of national 
origin. In our view, all of the above-mentione d measures seem to be inconsistent with 
paragraph 4 of Article III of GATT and Arti cle II of TRIMS Agreement. Does Indonesia 
consider these measures to be consistent with the agreements? If so, please explain the 
reason.  
Reply 
 
Indonesia reiterates its previous response in document G/TRIMS/W/75 that Decree No. 7/2009 is 
already in line with all WTO provisions, especially GATT Article III.8(a). Indonesia would also like 
to confirm that the Decree does not differentiate treatment between local and foreign-service providers so it is consistent with Article 2 of TRIMs Agreement.  
Question 2 
 In addition, according to the provisions of 1 (a) of the Annex of the TRIMS Agreement, 
TRIMs that are inconsistent with the obligation of national treatment provided for in 
paragraph 4 of Article III of GATT include th e measures which require the purchase or 
use by an enterprise of products of dome stic origin or from any domestic source. 
Therefore, in our view, those above-mentioned measures are inconsistent with 
paragraph 4 of Article III of GATT and TRIMS Agreement. Does Indonesia consider that 
those local requirements measures are cons istent with paragraph 4 of Article III of 
GATT and TRIMS Agreement? If so,  please explain the reason. 
 
Reply 
 
The regulation is intended to develop telecommunication sector in remote and under-
served/unserved areas, as well as rural areas which require government assistance. Therefore, Indonesia perceives that this program falls under government procurement activities which is 
regulated under Article III.8(a) of GATT 1994. As such, the enactment of this regulation does not 
                                               
1 G/TRIMS/W/154.   G/TRIMS/W/160 
 
- 2 - 
 
  violate the national treatment principle as stipulated in Article III.4 of GATT 1994 and 
TRIMs Agreement.   Question 3 
 
With regard to Decree 41/PER/M.KOMINFO/10/ 2009, which stipulates the calculation 
method of the TKDN, it does not clearly defi ne suppliers and products to which the TKDN 
is applied. In accordance with Article VI  of the TRIMS Agreement which stipulates 
transparency, could Indonesia explain what TKDN is imposed and to which types of 
telecommunications operators?   
Reply 
 
Please refer to our response in number 2.  
 
Question 4  
Are there any revision or additional regula tions to those measures? If any, please 
provide English translations.  Reply 
 So far, there is no revision or additional  regulation to the measures in question. 
 
 
 
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