WORLD TRADE  
ORGANIZATION   
G/SG/N/8/IDN/10/Suppl.1 
G/SG/N/10/IDN/10 G/SG/N/11/IDN/10 
2 December 2011 
 
(11-6298) 
Committee on Safeguards Original:   English 
 
 
 
NOTIFICATION UNDER ARTICLE 12.1(B) OF THE  
AGREEMENT ON SAFEGUARDS ON FINDING  
A SERIOUS INJURY OR THREAT THEREOF  
CAUSED BY INCREASED IMPORTS 
 
 
INDONESIA 
 
(Tarpaulins made from Synthetic Fibres apart 
from Awning and Sunblinds) 
  
 The following notification, dated 29 November 2011, is being circulated at the request of the 
Delegation of Indonesia.  
_______________ 
  
 Pursuant to Article 12.1(c) of the WT O Agreement on Safeguards, the Republic of 
Indonesia notifies on the imposition of a safeguards measure on import of Tarpaulins made from 
Synthetic Fibres under HS Ex. code 6306.12.00.00,  except Awning and Sunblinds, for a period of 
3 (three) years by the issuance of Minister of Finance's Decree number:  176/PMK.011/2011 dated 17 November 2011, pending promulgation in the Le mbaran Negara of the Republic of Indonesia. 
 
 It is requested that this notification unde r Article 12.1 (c) and Article 9.1 of the WTO 
Agreement on Safeguards be brought to the notice of Members. 
 
A. SUBJECT
 GOOD   
 
The coverage of product examined by the Inv estigating Authority is Tarpaulins made from 
Synthetic Fibres under HS Ex. code 6306.12.00.00, except Awning and Sunblinds.  The general uses 
of the subject good are, covering and protection from na tures (wind, sunlight, rain, and soil), also for 
building a tent, covering goods carry by trucks, basic occupancy structure, covering building 
renovation, water tank protection, tarpaulins fence, c ontainer of rain, market stall, storage and foods 
drying, aquaculture fish, and advertis ing purposes (advertisement and banner). 
 
B. PERIOD  OF INVESTIGATION 
 
The investigating period covers the calenda r year of 2007 until the calendar year 2010. 
 
C. THE  APPLICANT 
1. During the course of investigation, PT. Murn i Mapan Mandiri has withdrawn from being the 
Applicant.  Meanwhile, other domestic industry pr oducing the subject good PT. Politama Pakindo has G/SG/N/8/IDN/10/Suppl.1 
G/SG/N/10/IDN/10 
G/SG/N/11/IDN/10 
Page 2  
 
  extended support to the Application claiming that it has been experiencing a serious injury caused by 
increased volume of imports of the subject good.  
 
2. On the basis of the above mentioned situati on, the Investigating Authority regarded PT. 
Unggul Karya Semesta as the "Applicant" and PT. Politama Pakindo as "Supporter of the 
Application".  Consequently, the Investigating Author ity decided to focus its investigation not only on 
PT. Unggul Karya Semesta but also on PT. Politama Pakindo.  
 
D. HEARING 
 As required by Article 3.1 WTO Agreement on Safeguards, during the investigation period, 
the investigating authority has provided opportun ities to the importers, representative of exporting 
countries, the Applicant and the Supporter of the Appli cation, to submit their views and evidence.  In 
addition, the Investigating Authority also held  2 (two) Hearings.  Th e first Hearing held on 
13 June 2011, was intended to provide an opportunity  for the interested parties to submit their views 
and evidence on the application.  Following the Hear ing, the Investigating Authority received written 
comments and arguments from Importers Association of Indonesia (GINSI), Secretariat General of 
Indonesia Woven Polyolefin Manuf actures Association (G IATPI), and Indonesian Olefin, Aromatic 
& Plastic Industry Association (INAplas).  The second Hearing on 5 July 2011, held to provide 
opportunities for the interested parties to submit their views and evidence on the Investigating 
Authority provisional findings, fo r which the Investigating Author ity received written comments and 
arguments from Indonesian Olefin, Aromatic & Pl astic Industry Association (INAplas), the Embassy 
of Republic of Korea, and Importers  Association of Indonesia (GINSI). 
 
E. INFORMATION
 ON WHETHER  THERE  IS AN ABSOLUTE  INCREASE  IN IMPORTS   
1. Increased Level of Imports 
 
As provided in Table 1, the volume of imports of the subject good has increased quite 
substantially from year 2007 until 2010, specifically  in the year of 2008 there was a significant 
increase of 1,193 per cent from 2007, i.e. 66,477 Kg in 2007 to 859,803 Kg in 2008.  The import volume of the subject good further increased by 95 per cent in 2009 compared to 2008, and continued 
to increase by 168 per cent in 2010.  
 
In addition, the Investigating Authority also  found that the import of the subject good during 
the period of January 2011 to March 2011 was 2,226,746 Kg, an increase of 230 per cent compared to 
the level of volume of imports in the same period of 2010.  
Table 1:  Volume of Imports of the Subject Good 
 
Description Unit 2007 2008 2009 2010 
Imports Kg 66,477 859,803 1,674,670 4,494,583 
Source:  Badan Pusat Statistik (BPS).   
 
2. Unforeseen Development  
 
Prior to the period of investigation in genera l the prospect of applicant of the product 
concerned was good.  During the period, the growth of the industries and demand of the product  G/SG/N/8/IDN/10/Suppl.1 
 G/SG/N/10/IDN/10 
 G/SG/N/11/IDN/10 
 Page 3 
 
 
  concerned was 10 per cent in average every year, mirroring the growth in those industries using 
plastic materials such as food and beverages, and ag ricultural industries.  The growth was anticipated 
by the applicant of the subject good by incr easing the capacity and regenerating the industry 
concerned.  However, the good prospect was hampered  by the applicant lost its market share in the 
domestic market caused by a significant increased volume of imports.  The significant increase was 
mainly caused by the alteration of consumer's preference from domestic produced product to imported 
one, due to a cheaper price of impor ted subject good.  The shift of the preference has induced increase 
volume of imports, which was not anticipated by the applicant.  
 F. EVIDENCE
 OF SERIOUS  INJURY  OR THREAT  THEREOF  CAUSED  BY INCREASED  
IMPORTS 
 In order to investigate the claim of serious in jury by the Applicant and the Supporter of the 
Application, the Investigating Authority evaluated all data and information having a bearing on their 
situation, i.e national consumption, market shares,  domestic sales, producti on, utilization capacity, 
inventory, profit/loss, employment, and productivit y.  The evaluation was made from the data and 
information gathered from the results of on-site verification as well as from other related sources.  
Moreover, in order to complete evidence of serious  injury, the Investigating Authority also conducted 
the same investigation and evaluation to  the Supporter of the Application.  
 
The following Table 2, contained data and inform ation of the situation of the Applicant and 
the Supporter of the Application, which is provided in indices due to the sensitivity of the information 
concerned. 
 
Table 2:  Performance and Indicators of Serious  Injury of the Applicant and the Supporter 
of the Application caused by the Increased Volume of Imports 
 
DESCRIPTION UNIT YEAR 
2007 2008 2009 2010 
National Consumption  Indices 100 94 90 95 
Volume of Imports* Kg 66,477 859,803 1,674,670 4,494,583
Market Shares of the Applicant and the 
Supporter of the Application % 51.43 49.30 41.31 34.81 
Shares of Imports % 0.28 3.91 7.95 20.22 
Market Shares of the Other Domestic 
Industry** % 48.29 46.79 50.74 44.97 
Domestic Sales of the Applicant and the 
Supporter of the Application Indices 100 90 72 64 
Production of the Applicant and the 
Supporter of the Application Indices 100 88 87.6 89.9 
Utilization of Capacity of the Applicant and 
the Supporter of the Application  % 66.62 58.92 58.35 59.89 
Inventories the Applicant and the Supporter 
of the Application  Indices 100 99 165  273 
Profits/Loss of the Applicant and the Indices 100 27 (117) (194)G/SG/N/8/IDN/10/Suppl.1 
G/SG/N/10/IDN/10 
G/SG/N/11/IDN/10 
Page 4  
 
  DESCRIPTION UNIT YEAR 
2007 2008 2009 2010 
Supporter of the Application  
Employment of the Applicant and the 
Supporter of the Application  Indices 100 94 94 94
Productivity of the Applicant and the 
Supporter of the Application  Indices 100 93 93 93
 
* not an indexed figure. 
** non-Applicant and non-Supporter of the Application.   
 
Based on data and information in Table 2, the Investigating Authority came to the following 
findings:  
 
a. There was a decreased of national consumpti on of the subject good in the year of 2008 
compared to 2007 by 6 indexed points, and con tinued to decrease in 2009 by 4 indexed points 
compared to 2008.  Despite the fact  that there was an increased of  5 indexed points in 2010 compared 
to 2009, the total national consumption in 2010 was below of 2007.  
 
b. From year 2007 until 2010, domestic sales of the Applicant and the Supporter of the 
Application continued to decrease from year to year.  The domestic sales of the Applicant and the 
Supporter of the Application was 100 indexed points in 2007, declined to 90 indexed point in 2008, 
and continued to fall to 72 indexed point in 2009, and further reduced to 64 indexed point in 2010.   
 
c. In the period of investigation, the market sh ares of the Applicant and the Supporter of the 
Application have decreased significantly from 51.43 per cent in the year of 2007 to 49.30 per cent in 2008, and further decreased to 41.31 per cent in 2009 and to 34.81 per cent in 2010.  On the other 
hand, the market share of imports has increased c ontinuously in the same period, with a significant 
increase of 20.22 per cent in 2010 compared to 2007.   The market shares of other domestic industry 
also decreased from 50.74 per cent in 2009 to 44.97 per cent in 2010. 
 
d. The production of the Applicant and the Suppor ter of the Application decreased in 2008, 
2009, and 2010 compared to 2007.   Although there was a slight increase of production in 2010 
compared to 2009 and 2008, the production in 2010  still below of 2007.  According to the 
investigation in this specific sector, the Investig ating Authority found that  the small increase of 
production in 2010 was the result of their efforts to improve efficiency.   
 
e. Parallel to the decreased in domestic sales, market shares, and production of the Applicant 
and Supporter of the Application, their utilization capacity was also decreased continuously from the 
year 2007 until 2009, which were 66.62 per cent in  year 2007 to 58.92 per cent in year 2008 and 
reached a level of 58.35 per cent in year 2009.  Ho wever, in the year of 2010 the utilization capacity 
has been increased to 59.89 per cent,  despite the fact that the number of employees remained the same 
in the effort of the Applicant and Supporter of th e Application to increase th e production.  The effort 
was made with the anticipation to  increase domestic sales in line with the increase of national 
consumption in the year of 2010.  However, the an ticipation was not realized and the domestic sales 
of the Applicant and the Supporter of the Applicati on continued to decrease in the year concerned. 
  G/SG/N/8/IDN/10/Suppl.1 
 G/SG/N/10/IDN/10 
 G/SG/N/11/IDN/10 
 Page 5 
 
 
  f. The attempt of the Applicant and the Supporte r of the Application to increase production, 
while domestic sales continue to decrease and the market shares continue to shrink, resulted in 
increase of inventories from 100 indexed points in year 2007 to 273 indexed points in year 2010.  
 
g. As the result of a combination of declined in sales, market shares, production, and increase in 
inventories, there was a decreased of profits of the Applicant and the Supporter of the Application in 2007 to 2008 from 100 indexed points to 27 indexed points respectively.  In the year of 2009 the 
financial situation of the Applicant and the Suppor ter of the Application has worsen with a big 
financial losses of 117 indexed points, and of 194 in dexed points in 2010.  A significant increase in 
inventories especially in the year of 2009 and 2010, contributed to financial burden to the Applicant 
and the Supporter of the Application because of the expenses related to the maintenance of inventories 
concerned.   
h. Although, the Applicant and the Supporter of th e Application had suffered from big financial 
losses in year 2009 to 2010, they made a serious effo rt to prevent layoffs, which was contributed to 
the financial losses.  Consequently, the number of  employees in 2009 and 2010 were the same level 
of 2008, which is smaller by 6 indexed points compared to the number of employees in 2007.  
 
i. Despite the fact that the Applicant and the Supporter of the Application experienced a 
reduction of profits in 2008, and significant financ ial losses in 2009 and 2010, the productivity remain 
stable because the employees were kept at the same number in year 200 8, 2009, and 2010.  
 Conclusion  
Based on the information in Table 2, the Inves tigating Authority concluded that as the result 
of significant negative trends in domestic sales and market shares, the inventories of the Applicant and the Supporter of the Application has increased 173 per cent in 2010 compared with 2007.  In 
addition, the Applicant and the Supporter of th e Application had been experiencing continuous 
decreased in production, utilization capacity, and productivity during the period of investigation.  
Although the level of employment has decreased in  2008 compared with 2007, the Applicant and the 
Supporter of the Application had made serious  effort to avoid layoff from 2008 to 2010.  A 
combination of negative trends of the performan ce of the Applicant and the Supporter of the 
Application as a whole has caused significant reduc tion of profits in 2008,  and sizeable financial 
losses in the year of 2009 and 2010.  
 G. CAUSAL
 LINK 
 Based on the findings as elaborated in Point F,  the Investigating Aut hority concluded that 
there was strong linkage between the loss of market shares of the Applicant and the Supporter of the 
Application, and the increased of market shares of  imports, because increased of market shares of 
imports equal to the total decrease of market sh ares of the Applicant and the Supporter of the 
Application, as well as of other domestic industry.  In  other words, the serious injury of the Applicant 
and the Supporter of the Application caused by in crease of volume of imports of the subject good, 
where the market shares of the Applicant and the S upporter of the Application was taken by imports. 
 H. OTHER
 FACTORS  THAT  MAY  CONTRIBUTE  TO INJURY 
During the investigation other factors known that  may cause injury to the Applicant and the 
Supporter of the Application were also examined.  The result are as follows: 
 1. The Capacity of Production  G/SG/N/8/IDN/10/Suppl.1 
G/SG/N/10/IDN/10 
G/SG/N/11/IDN/10 
Page 6  
 
   
 On the production capacity of the Applicant and the Supporter of the Application, the 
Investigating Authority concluded that their produ ction capacity basically sufficient to supply the 
national consumption of the subject good.  However,  the Investigating Authority found that their 
production capacity was not fully utilized due to con tinuous reduction in domes tic sales.  Thus, it is 
concluded that the production capacity is not a factor that contribute to the injury of the Applicant and 
the Supporter of the Application, but the increased volume of imports has contributed to their inability 
to utilize the production capacity fully. 
 2. Competition with other domestic industries 
 
During the period of investigation there was no changes in the condition of the competition 
between the Applicant and the Supporter of the A pplication and other domestic industries.  It was 
based on the data of market shares of the entire dome stic industries i.e. the Applicant, the Supporter of 
the Application, and other domestic industries of th e subject good, tend to decline, while the market 
shares of imports of the subject good continue to increase.  Thus, the Investigating Authority 
concluded that the competition between the Applicant and the Supporter of the Application with other 
domestic industries did not cause a serious injury.    
 The above mentioned findings proved that othe r factors known to the Investigating Authority 
have not contributed to the serious injury of the Applicant and the Supporter of the Application.    
I. THE
 SAFEGUARDS  MEASURE  AND  EXPECTED  TIMETABLE 
The safeguards measure is imposed on importati on of Tarpaulins made from Synthetic Fibres 
under HS Ex. code 6306.12.00.00, except Awning and S unblinds in the form of specific duty for 3 
(three) years.  The amount of the specific duty will be progressively liberalized in the second year and third year of the imposition period: 
 
Table 3:  Recommended Timetable of the imposition 
of the Safeguards duty 
 
Period Specific Duty 
17 November 2011 -16 November 2012 Rp. 13,643 per Kilogram 
17 November 2012 -16 November 2013 Rp. 12,643 per Kilogram 
17 November 2013 -16 November 2014 Rp. 11,643 per Kilogram 
 
J. LIST  OF DEVELOPING  COUNTRIES  EXCLUDED   
 Pursuant to Article 9.1 WTO Agreement on Safeguards, the following is the list of 
Developing Countries excluded from the safeguard meas ure as they exported with a market share of 
less than 3 per cent of total volume imports or that developing country Members with less than 
3 per cent import share collectively account for not more than 9 per cent of the total volume imports 4,494,583 Kg.    G/SG/N/8/IDN/10/Suppl.1 
 G/SG/N/10/IDN/10 
 G/SG/N/11/IDN/10 
 Page 7 
 
 
  List of Developing Countries Excluded from the Measure 
 
No COUNTRY No COUNTRY 
1 Albania 56 Lesotho 
2 Angola 57 Macao, China 
3 Antigua and Barbuda 58 Madagascar 
4 Argentina 59 Malawi  
5 Armenia 60 Malaysia 
6 Bahrain, Kingdom of 61 Mali 
7 Bangladesh 62 Mauritania 
8 Barbados 63 Maldives 
9 Belize 64 Mauritius 
10 Benin 65 Mexico 
11 Bolivia, Plurinational State of  66 Moldova 
12 Botswana 67 Mongolia 
13 Brazil 68 Morocco 
14 Brunei Darussalam 69 Mozambique 
15 Burkina Faso 70 Myanmar 
16 Burundi 71 Namibia 
17 Cambodia 72 Nepal 
18 Cameroon 73 Nicaragua 
19 Cape Verde 74 Niger 
20 Central African Republic 75 Nigeria 
21 Chad 76 Oman 
22 Chile 77 Pakistan 
23 Chinese Taipei 78 Panama 
24 Colombia 79 Papua New Guinea 
25 Congo 80 Paraguay 
26 Costa Rica 81 Peru 
27 Côte d'Ivoire 82 Philippines 
28 Croatia 83 Qatar 
29 Cuba 84 Rwanda 
30 Democratic Republic of the Congo 85 Saint Kitts and Nevis 
31 Djibouti 86 Saint Lucia 
32 Dominica 87 Saint Vincent & the Grenadines 
33 Dominican Republic 88 Saudi Arabia, Kingdom of 
34 Ecuador 89 Senegal 
35 Egypt 90 Sierra Leone 
36 El Salvador 91 Solomon Islands 
37 Fiji 92 South Africa 
38 Former Yugoslav Republic of Macedonia 
(FYROM) 93 Sri Lanka 
39 Gabon 94 Suriname G/SG/N/8/IDN/10/Suppl.1 
G/SG/N/10/IDN/10 
G/SG/N/11/IDN/10 
Page 8  
 
  40 Georgia 95 Swaziland 
41 Ghana 96 Tanzania 
42 Grenada 97 Thailand 
43 Guatemala 98 The Gambia 
44 Guinea 99 Togo 
45 Guinea Bissau 100 Tonga 
46 Guyana 101 Trinidad and Tobago 
47 Haiti 102 Tunisia 
48 Honduras 103 Uganda 
49 Hong Kong, China 104 Ukraine 
50 India 105 United Arab Emirates 
51 Jamaica 106 Uruguay 
52 Jordan 107 Venezuela, Bolivarian Republic of  
53 Kenya 108 Zambia 
54 Kuwait 109 Zimbabwe 
55 Kyrgyz Republic 
 
  
__________