WORLD TRADE  
ORGANIZATION  WT/REG241/1  
6 July 2009 
 (09-3325) 
Committee on Regional Trade Agreements  
  
 
    
 
 
FACTUAL PRESENTATION 
 
Economic Partnership Agreement  
between  
Japan and Indonesia 
(Goods and Services) 
 
Report by the Secretariat 
 
 
 
 This report, prepared for the considerati on of the Economic Partnership Agreement 
between Japan and Indonesia has been dr awn up by the WTO Secretariat on its own 
responsibility and in full consultation with the Parties.  The report has been drawn 
up in accordance with the rules and pro cedures contained in the Decision for a 
Transparency Mechanism for Regiona l Trade Agreements (WT/L/671).  
 Any technical questions arising from this report may be addressed to 
Ms. Jo-Ann Crawford (tel: +41 22 739 5422).  WT/REG241/1 
 Page iii 
 
 
TABLE OF CONTENTS 
 
  Page 
I. TRADE ENVIRONMENT 1  
A. MERCHANDISE TRADE  1  
B. TRADE IN SERVICES AND INVESTMENT  4  
II. CHARACTERISTIC ELEMENTS OF THE AGREEMENT 8  
A. BACKGROUND INFORMATION  8  
III. NATIONAL TREATMENT AND MARKET ACCE SS PROVISIONS ON TRADE IN 
GOODS 10 
A. IMPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  10  
1. General Provisions 10  
2. Liberalization of trade and tariff lines 10  
3. Indonesia's Liberalization Schedule 12  
4. Japan's Liberalization Schedule 14  
5. Tariff-rate quotas 17  
B. RULES OF ORIGIN  17  
C. EXPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  18  
D. REGULATORY PROVISIONS ON TRADE IN GOODS  18  
1. Standards 18  
(a) Sanitary and Phytosanitary Measures 18  
(b) Technical Barriers to Trade. 18  
2. Safeguard mechanisms 19  
(a) Global safeguard actions 19  
(b) Bilateral safeguard actions 19  
3. BOP safeguards 19  
4. Anti-dumping and countervailing measures 19  
5. Subsidies and State-aid 20  
6. Customs-related procedures 20  
IV. PROVISIONS ON TRADE IN SERVICES AND INVESTMENT 20  
A. SCOPE AND DEFINITIONS  20  
B. MARKET ACCESS  21  
C. NATIONAL AND MFN  TREATMENT  21  
D. MOVEMENT OF NATURAL PERSONS  21  
E. DENIAL OF BENEFITS  24  
F. LIBERALIZATION COMMITMENTS ON TRADE IN SERVICES  24  
1. Japan 24  
(a) Horizontal commitmen ts / exceptions 24  
(b) Sector specific commitments / exceptions 25  
2. Indonesia 26  
(a) Horizontal commitmen ts / exceptions 26  
(b) Sector specific commitments / exceptions 26  
G. LIBERALIZATION COMMITMENTS ON INVESTMENT  27  
1. Japan 28  
2. Indonesia 30  
H. SAFEGUARD ACTIONS ON SERVICES TRADE AND INVESTMENT  32  WT/REG241/1 
Page iv  
 
I. DOMESTIC REGULATION  33  
J. RECOGNITION  33  
V. PROVISIONS AFFECTING TRADE IN GOODS, SERVICES AND INVESTMENT 33  
A. COMPETITION  33  
B. GOVERNMENT PROCUREMENT  33  
C. INTELLECTUAL PROPERTY RIGHTS  33  
D. ENVIRONMENT  34  
E. SECTOR SPECIFIC PROVISIONS  34  
1. Energy and Mineral Resources 34  
F. INSTITUTIONAL PROVISIONS  34  
1. General Provisions and Exceptions 34  
2. Accession 34  
3. Termination 35  
4. Institutional framework 35  
5. Dispute settlement 35  
6. Relationship with other agreements concluded by the Parties 37  
ANNEX  38 
 
  WT/REG241/1 
 Page 1 
 
 
I. TRADE ENVIRONMENT 
1. The Economic Partnership Agreement (EPA) between Japan and Indonesia (hereinafter 
referred to as 'the Agreement') is Japan's fourth  free trade agreement (FTA) with an Asian country 
(following its FTAs with Singapore, Malaysia and Th ailand) and Indonesia's first bilateral FTA with 
an Asian country (it is a founding member of the ASEAN free trade agreement). 
2. Japan is Indonesia's third largest trading part ner in terms of imports in 2007, accounting for 
8.8% of its total imports, and its largest trad ing partner in terms of 2007 exports, accounting for 
20.7% of its total exports.1  Indonesia is Japan's 7th largest trading partner in terms of 2007 imports, 
accounting for 4.3% of its total imports and its 17th largest trading partner in terms of 2007 exports, 
accounting for 1.3% of its total exports.2 
3. Japan's GDP was estimated at US$4,340 billion in 2006, while that of Indonesia reached 
US$364 billion in the same year.3  With total merchandise exports of US$650 billion and imports of 
US$580 billion, Japan ranked in 2006 as the fourth e xporter and the fifth importer in the world;  with 
merchandise exports of US$104 billion and imports  of US$80 billion, Indonesia ranked as the 
31st largest exporter and importer in that year. 
A. MERCHANDISE TRADE  
4. Recent developments in global and intra-Party trade are presented in Charts I.1 and I.2.  Over 
the period surveyed (1998-2007), Indonesia has run a consistent trade surplus both on a global basis 
and with Japan. 
0102030405060708090100110120
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007051015202530354045505560US$billion US$billio nChart I.1 - Indonesia: Merchandise imports from and exports to 
world and Japan, 1998-2007
Sources : UNSD, Comtrade database (1998-2004 trade; 2005-2007 exports to Japan and world); 
              Indonesian submission (2005-2006 imports from Japan and world).Imports from Japan
Exports to JapanTotal imports
Total exportsLeft hand scale: Right hand scale:
 
                                                           
1 UNSD, Comtrade database (2007).  Countries of the European Communities are considered 
individually. 
2 UNSD, Comtrade database (2007). 
3 WTO, Trade Profiles. WT/REG241/1 
Page 2  
 
0100200300400500600700800
1998 1999 2000 2001 2002 2003 2004 2005 2006 20070510152025303540US$billion US$billio nChart I.2 - Japan: Merchandise imports from and exports to world 
and Indonesia, 1998-2007
Source : UNSD, Comtrade database.Imports from Indonesia
Exports to IndonesiaTotal imports
Total exportsLeft hand scale: Right hand scale:
 
 
 
5. The commodity structure of trade among the Parti es, as well as of their imports and exports to 
the world in the period 2005-2007, is shown in Ch art I.3 on the basis of Harmonized System (HS) 
sections. 
6. Indonesia's four largest export product categori es – minerals, machinery, textiles and base 
metals – made up 60.1% of its total exports in  2005-2007 and accounted for 78.8% of Japan's imports 
from Indonesia, although textiles account only for 2.1% of those imports.  Japan's four largest export 
product categories – machinery, vehicles, base metals, and chemicals – made up 78.9% of its total exports in 2005-2007 and accounted for 85.6%  of Indonesia's imports from Japan.   
  WT/REG241/1 
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Chart I.3
Japan and Indonesia: product compos ition of merchandise trade, annual 
average 2005-07
Japan's imports from Indonesia Indonesia's imports from Japan
Sources:  UNSD, Comtrade database (Japan; Indonesian exports to world); 
                 Indonesian submission (Indonesian imports from Japan and world)                 Per cent
Total:  US$23.8 billion Total:  US$6.0 billion
Total:  US$572.4 billion Total: US$56.0 billion
Total:  US$652 billion Total:  US$100.2 billionJapan's global exports Indonesia's global exportsJapan's global imports Indonesia's global imports Chemicals 10.0
Machinery
17.9Animals 3.5
Minerals 
31.6
Chemicals 7.0Optical 1.8
Pulp of wood  2.5
Machinery
39.4Other 
11.1Other 
7.5
Base metals 8.1Articles of wood 4.7
Minerals 27.2
Base metals 5.5
Plastics 4.5
Base metals 
7.3 Textiles 2.1
Vehicles 24.4Prepared foods 2.3Other
8.9Other
5.1
Articles of wood  3.3Other 
4.0Machinery 8.0
Vehicles  24.7
Plastics 6.8Minerals 31.0
Machinery 21.3Vehicles  3.5
Chemicals  6.4Prepared foods 3.3Vegetables 2.8Plastics 2.3
Textiles 5.0
Textiles 9.3Miscellaneous 2.2Other 
6.9
Vehicles  9.2Prepared foods 4.0
Chemicals 4.3Chemicals  13.7
Vehicles 2.4Minerals 59.1Animals 2.4
Fats and oils 7.1Base metals 9.6Plastics 5.3
Optical 4.2Articles of wood 2.1
Base metals 9.5Plastics 4.4
Machinery 11.9Vegetables 4.6
Optical 5.6Machinery 36.7
Base metals 14.3Plastics 7.4
Textiles 2.8
Pulp of wood  3.9Miscellaneous 2.3
 
 WT/REG241/1 
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B. T
RADE IN SERVICES AND INVESTMENT  
7. In 2006, Indonesia ranked 51st in terms of world exports of commercial services and 28th in 
terms of imports.  Its commercial services exports  amounted to US$5.1 billion, representing 0.28% of 
world exports, while imports amounted to US$17.2 bi llion, representing 0.96% of world imports.  In 
the same year Japan ranked fourth in the world bo th for exports and imports of commercial services.  
Its commercial services exports amounted to US$122 .5 billion, representing 4.43% of world exports, 
while imports amounted to US$144 billion representing 5.48% of world imports.4   
8. Chart I.4 shows the breakdown of commercial se rvices trade for Indonesia in 1998-2006.  
Indonesia was a net importer of commercial services  over the period surveyed.  Travel services and 
other business services account for the largest shares  of imports, while transportation services, travel 
services and other business services account for th e largest and increasing share of exports of 
commercial services. 
035810131518202325
1998
1999
2000
2001
2002
2003
2004
2005
2006035810131518202325
1998
1999
2000
2001
20022003
2004
2005
2006Chart I.4
Indonesia, total commercial services trade, 1998-2006
Exports Imports
Transportation services
Travel services
Sourc e: IMF, BOP CD-Rom.Communications servicesUS$ billion
Construction servicesFinancial services
Computer and information services
Royalties and license Other business services
Personal and cultural services
Government servicesUS$ billion
 Insurance services
 
 
9. Indonesia's global investment position is depicted in Chart I.5.  Indonesia's stock of inward 
FDI has fluctuated over the period, while its outward stock has increased annually.  
                                                           
4 WTO, Trade Profiles.  WT/REG241/1 
 Page 5 
 
 
 
0.05.010.015.020.025.0
2002 2003 2004 2005 2006 20070.05.010.015.020.025.0
2002 2003 2004 2005 2006 2007Chart I.5
Indonesia inward and outward foreign direct investment stock from world, 2002-07
Inward OutwardUS$ billion US$ billion
Sources : Indonesia Investment Coordinating Board (inward); UNCTAD, Foreign Direct Investment database (outward). 
 
 
10. Indonesia's bilateral investment position with Japan is shown in Table I.1  
Table I.1 
Indonesia's bilateral investment  flows with Japan, US$ million 
Year 2002 2003 2004 2005 2006 2007 
Inward flow 433.9 732.9 1041.2 1144.3 902.8 618.2 
Outward flow - - - - - - 
Source:  Indonesia Investment Coordinating Board. 
 
11. Chart I.6 shows the breakdown of commercial services trade for Japan in 1998-2006.  
Transportation services, other business services, a nd royalties and license fees represent the largest 
categories in terms of exports of commercial serv ices, while transportation services, travel services, 
and other business services are the largest in terms of imports. 
 WT/REG241/1 
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0102030405060708090100110120130140
1998
1999
2000
2001
2002
20032004
2005
20060102030405060708090100110120130140
1998
1999
2000
2001
2002
2003
2004
2005
2006Chart I.6
Japan, total commercial services trade, 1998-2006
Exports Imports
Transportation services
Travel services
Sourc e: IMF, BOP CD-Rom.Communications servicesUS$ billion
Construction servicesFinancial services
Computer and information services
Royalties and license Other business services
Personal and cultural services
Government servicesUS$ billion
 Insurance services
Note:     Exports of insurance services were negative in the following years: 1999 (-US$80 million),
              2001 (-US$100 million), and 2002 (-US$380 million).
 
 
 12. Chart I.7 shows the breakdown of Japan's commercial services trade with Indonesia in 
2005-2007.  Transportation services, construction se rvices, and royalties and license fees are the 
largest categories in terms of exports of commerc ial services, while travel services, construction 
services, and other business services are the largest in terms of imports. 
 
   WT/REG241/1 
 Page 7 
 
 
0.00.51.01.52.0
2005
2006
20070.00.51.01.52.0
2005
20062007Chart I.7
Japan, bilateral commercial servic es trade with Indonesia, 2005-2007
Exports Imports
Transportation services
Travel services
Sourc e: WTO Secretariat, based on data supplied by Japan.Communications services
Construction servicesFinancial services
Computer and information services
Royalties and license Other business services
Personal and cultural services
Government services Insurance servicesUS$ billion US$ billion
 
 
 13. Japan's global investment position is depicted in Chart I.8.  Japan's inward stock of foreign 
direct investment (FDI) increased by 47% over th e period 2002-2006, while its stock of outward FDI 
increased by 58% over the same period.
5   
14. Japan's bilateral investment position w ith Indonesia is shown in Table I.2.  
Table I.2 
Japan's bilateral investment flows with Indonesia, US$ million 
Year 2005 2006 2007 
Inward flow 0 3.4 1.7 
Outward flow 1216.7 742.9 1025 
Inward stock 6.4 8.6 8.5 
Outward stock 8186.3 7625.1 7987 
Source:  WTO Secretariat based on data provided by Japan. 
 
                                                           
5 Exchange rates to convert yen to US$ are the following:  2002 – 125.39;  2003 – 115.93;  2004 – 
108.19;  2005 – 110.22;  2006 – 116.30;  and 2007 – 117.754. WT/REG241/1 
Page 8  
 
0102030405060708090100110120
2002 2003 2004 2005 2006050100150200250300350400450500
2002 2003 2004 2005 2006Chart I.8
Japan inward and outward foreign direct investment stock from  world, 2002-2006
Inward Outward
Source : WTO Secretariat estimates based on data at http://www.boj.or.jp/en.US$ billion US$ billion
 
 
II. CHARACTERISTIC ELEMENTS OF THE AGREEMENT 
A. BACKGROUND INFORMATION  
15. The Agreement was signed by Japan and Indonesi a on 20 August 2007 and entered into force 
on 1 July 2008. 
16. The goods and services aspects of the Agreement were notified to the WTO by the Parties on 
27 June 2008 under Article XXIV :7(a) of the GATT 1994, and Article V:7(a) of the GATS, 
respectively (document WT/REG241/N/1 and S/C/N/462).  The text of the Agreement is available, 
together with its related Annexes, on the following official websites:   http://www.mofa.go.jp/region/asia-paci/indonesia/epa0708/index.html
 
 http://ditjenkpi.depdag.go. id/index.php?module=ijepa  
17. The Agreement is composed of 15 Chapte rs and has 12 related Annexes, as follows:  WT/REG241/1 
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Box II.1:  Composition of the Agreement 
Preamble 
Chapter 1:  General Provisions  
Chapter 2:  Trade in Goods  
Chapter 3:  Rules of Origin Chapter 4:  Customs Procedures   
Chapter 5:  Investment 
Chapter 6:  Trade in Services  
Chapter 7:  Movement of Natural Persons 
Chapter 8:  Energy and Mineral Resources  Chapter 9:  Intellectual Property 
Chapter 10:  Government Procurement   
Chapter 11:  Competition  Chapter 12:  Improvement of Business Environment and Promotion of Business Confidence   
Chapter 13:  Cooperation   
Chapter 14:  Dispute Settlement Chapter 15:  Final Provisions   
Annexes 
  Annex 1 Schedules in relation to Article 20
 
  Annex 2  Product Specific Rules  
  Annex 3  Minimum Data Requirement for Certificate of Origin 
  Annex 4  Reservations for Measures referred to in Subparagraph 1(a) of Article 64   Annex 5  Reservations for Measures referred to in Paragraph 3 of Article 64 
  Annex 6  Additional Provisions with respect to the Settlement of Investment Disputes referred to in 
Paragraph 21 of Article 69    Annex 7  Financial Services  
  Annex 8  Schedules of Specific Commitments in relation to Article 81 
  Annex 9  Lists of Most-Favoured-Nation Treatment Exemptions in relation to Article 82 
  Annex 10  Specific Commitments fo r the Movement of Natural Persons  
  Annex 11 List of Energy and Mineral Resource Goods    Annex 12 Additional Provisions with respect to the Promotion and Facilitation of Investment in the Energy 
and Mineral Resources Sector referred to in Paragraph 2 of Article 98  
Source : Agreement between Japan and the Republic of Indonesia for an Economic Partnership. 
 
18. In addition, the Agreement provides for an Implementing Agreement between the Parties 
pursuant to Article 13 of the Agreement.6 
19. As regards trade in goods, no overall implemen tation period is explicitly stated in the 
Agreement.  However, the Parties' schedules of concessions for merchandise tr ade foresee a transition 
period of up to 15 years, i.e. until 2023 for some pro ducts.  In addition, for cer tain products the Parties 
agree to negotiations in the fourth year following the Agreement's entry into force. 
                                                           
6 At the first meeting of the Joint Committee on the date of entry into force of the Agreement, it 
adopted decisions necessary for the implementation of the Agreement, including Op erational Procedures for 
trade in goods and rules of origin.  These are available at the following address:  
http://www.mofa.go.jp/region/asia-paci/indonesia/agree0807.pdf. WT/REG241/1 
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III. NATIONAL TREATMENT AND MARKET ACCESS PROVISIONS ON TRADE IN 
GOODS 
A. I
MPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  
1. General Provisions 
20. Each Party accords national treatment to the goods of the other Party in accordance with 
Article III of the GATT 1994 (Article 19). 
21. The Parties agree to reduce or eliminate cust oms duties on originating goods as scheduled in 
Annex 1 of the Agreement (Article 20).  Annex 1 contains ten categories relating to tariff 
liberalization between the Parties:  i) the immediate elimination of customs duties from the date of entry into force of the Agreement (category A);  ii) the progressive elimination of customs duties in 
four, six, eight, 11, or 16 equal stages (categori es B3, B5, B7, B10 and B15);  iii) subject to various 
timetables for tariff reduction or elimination for each  Party (category P);  iv) subject to tariff rate 
quota (category Q), in the case of Japan only;  v) subject to renegotiation (category R);  and vi) excluded from liberalization (category X).  In the case of Japan, tariff reductions take place on the date of entry into force of the Agreement and on 1 April of following years.  For Indonesia, tariff 
reductions take place on the date of entry into for ce of the Agreement and on 1 January in subsequent 
years.   
22. The Parties agree not to introduce or maintain any non-tariff measures on imports from or 
exports to each other which are inconsistent with their obligations under the WTO Agreement 
(Article 23).   
23. In cases where the MF N rate applied is lower for a partic ular good than that applied under the 
Agreement, the Parties agree to apply the lower ra te with respect to that good (Article 20.6).  
24. Upon request of either Party, the Parties ag ree to negotiate improved market access of goods 
designated for negotiation in the respective schedule in Annex 1, in accordance with the terms and 
conditions set out in the schedule (Article 20.2).  Th e Parties agree to undertake a general review of 
the implementation and operation of the Agreem ent in the fifth calendar year following the 
Agreement's entry into force and every five year s thereafter, unless otherwise agreed by the Parties 
(Article 151). 
2. Liberalization of trade and tariff lines 
25. The elimination of tariffs applicable between  the Parties is detailed in the corresponding 
Parties' schedules.  Tariff elimin ation started on 1 July 2008, from th e base rates applied in April 2005 
for Japan and February 2006 for Indonesia.  
26. The overall tariff elimination under the Agreem ent is depicted in Tables III.1 and III.2 
below.
7  The tariff file submitted by Indonesia contains th e applicable preferential rates to be applied 
from 2008 to 2012 in accordance with Minister of Finance Regulation No. 95/PMK.011/2008.  The 
preferential tariffs to be applied from 2013 to the en d of the transition period in 2023 were calculated 
by the Secretariat and appended to this file, b ased on the tariff liberalization modalities agreed under 
the Agreement.   
                                                           
7 Tariff lines containing in-quota duties are ex cluded from all the tari ff-related calculations.  WT/REG241/1 
 Page 11 
 
 
27. In the case of Indonesia, 24% of total tariff lines were already duty -free on an MFN basis in 
2008.8  A further 14.7% of tariff lines became duty-free for imports from Japan in 2008;  in terms of 
imports from Japan for the period 2005-2007, these fi gures amount to 33.4 and 1.8%, respectively.  
By the end of the transition period in 2023, a further 54.2% of tariff lines are to be liberalized, accounting for 56.9% of imports from Japan for the peri od 2005-2007.  Thus, a total of 92.9% of tariff 
lines are liberalized under the Agreement, correspondi ng to 92.1% of imports by value from Japan for 
the period 2005-2007. 
Table III.1 
Indonesia:  Tariff elimination commitments under the Ag reement and corresponding average trade values for 2005-2007 
Duty phase-out 
period Number of lines % of total lines in 
Indonesia's tariff 
schedule Value of Indonesia's 
imports from Japan  
(2005-2007) 
in million US$ % of Indonesia's total 
imports from Japan 
2005-2007 
MFN duty free 
(2008) 2,096 24.0 2,020.3 33.4 
2008 1,285 14.7 106.5 1.8 
2009 359 4.1 478.3 7.9 
2010 204 2.3 147.5 2.4 
2011 1,930 22.1 497.4 8.2 
2012 116 1.3 25.5 0.4 
2013 557 6.4 469.0 7.8 
2015 552 6.3 333.3 5.5 
2016 11 0.1 2.6 0.0 
2018 835 9.6 1,400.7 23.2 
2023 172 2.0 84.8 1.4 
Remain dutiable 618 7.1 477.4 7.9 
Total 8,735 100.0 6,043.4 100.0 
 
Source:  WTO estimates based on data provided by Indonesia. 
 
28. In the case of Japan, 41.7% of total tariff lin es were already duty-fr ee on an MFN basis in 
2008.9  A further 40.4% of tariff lines became duty-free for imports from Indonesia in 2008;  in terms 
of imports from Indonesia for the period 2004-200610, these figures amount to 81.9% and 9.4%, 
respectively.  By the end of the transition period in 2023, a further 7.2% of tariff lines are to be 
liberalized, accounting for 3.2% of imports from I ndonesia for the period 2004-2006.  Thus, a total of 
89.2% of tariff lines are liberalized under the Agreem ent, corresponding to 94.4% of imports by value 
from Indonesia for the period 2004-2006. 
Table III.2 
Japan:  Tariff elimination commitments under the Agreeme nt and corresponding average trade values for 2004-2006 
Duty phase-out 
period Number of lines % of total lines in 
Japan's tariff schedule Value of Japan's imports 
from Indonesia 
(2004-2006) 
in million US$ % of Japan's total 
imports from 
Indonesia 2004-2006 
MFN duty free (2008) 3,714 41.7 17,317.8 81.9 
2008 3,604 40.4 1,994.6 9.4 
2011 25 0.3 0.8 0.0 
2013 77 0.9 34.8 0.2 
Table III.2 (Cont'd)  
                                                           
8 Indonesia's tariff is composed of 8,735 tariff lines  at the HS 10-digit level;  17 lines are subject to 
specific duties, the rest contain ad valorem  rates.    
9 Japan's tariff is composed of 8,912 tariff lines at the HS 9-digit level;  205 lines are subject to specific 
duties, 56 to compound duties, 329 to mixed duties, and 20 to other duties.  The rest contain ad valorem  rates.   
10 Given the change in HS nomenclature in 2007, imports for 2004-2006 were used. WT/REG241/1 
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Duty phase-out 
period Number of lines % of total lines in 
Japan's tariff schedule Value of Japan's imports 
from Indonesia 
(2004-2006) 
in million US$ % of Japan's total 
imports from 
Indonesia 2004-2006 
2015 250 2.8 607.5 2.9 
2018 202 2.3 10.8 0.1 
2023 78 0.9 1.3 0.0 
Remain dutiable 962 10.8 1,184.3 5.6 
Total 8,912 100.0 21,151.8 100.0 
Note: Based on the HS 2002 nomenclature.  Calculati ons exclude tariff lines having an in-quota rate. 
 
Source:  WTO estimates based on data provided by Japan. 
 
3. Indonesia's Liberalization Schedule 
29. The base rates used by Indonesia for implemen ting its tariff liberalization scheme provided 
for 24% of tariff lines being duty free before the entr y into force of the Agreement.  As can be seen 
from Chart III.1, most of the lines freed of duties in 2008 to 2010 are subject to rates of 10% or less.  
Lines subject to duties of up to 50% are liberali zed from 2012 onwards.  The lines subject to duties of 
more than 50% are not liberalized under the Agreement.   
0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,0002008200920102011201220132015201620182023Chart III.1
Indonesia's duty elimination under the Agreement
Year of duty free treatment   
Source: WTO Secretariat estimates, based on data provided by Indonesia.Number of duty-free lines (cumulative)
Duty-free <10% <20% <30% MFN is: <40% <50% >50%
 
 
30. Table III.3 shows Indonesia's trade liberaliza tion commitments under the Agreement on the 
basis of products' treatment at the HS 10-digit leve l organized by HS section product categories.  Of 
the 8,735 tariff lines forming Indonesia's tariff sched ule, 2,096 tariff lines were already duty-free on 
an MFN basis in 2008;  the lines liberalized upon entry into force of the Agreement cover a broad 
range of HS sections.  Likewise, the 618 lines which remain subject to duties cover both agricultural 
and industrial products.  The average final tariff on dutiable items ranges from 1.7% to 134.4%, the 
latter applying to prepared foods.  WT/REG241/1 
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Table III.3 
Indonesia:  Tariff elimination un der the Agreement, by HS section 
Number of duty-free lines  HS Section  
MFN 
avg.% 
2008  Total  
No of 
lines  MFN 
duty-
free 
2008  
2008 
2009 
2010 
2011 
2012 
2013 2015 
2016 
2018 
2023 
Remain dutiable  
Avg Final Tariff 
(Dutiable) 
I  5.1 351 41 19   69  9   144 5 64 5.7 
II  5.3 399 47 63   223  6 2  28 1 29 6.3a 
III  5.1 153 47    71  12 4  17  2 1.7 
IV  23.9 391 19 34   28  45 113  74 19 59 134.4a 
V  3.3 199 72 1  3 114  2 3   4   
VI  4.7 1,108 269 19  19 511  201 24  40 8 17 23.2 
VII  9.7 397 12   3 146  59 54  108 1 14 19.5 
VIII  6.1 86 30 2   13  9 24  5 3   
IX  3.4 181 109 2   13  10 3  44    
X  4.7 232 45 4   156  26     1 15.0 
XI  10.7 1,019 7 1,012            
XII  15.2 63 1 2   10  9 11  17 9 4 15.0 
XIII  7.3 196 9    32  35 73  46 1   
XIV  7.1 75 21    7  18   4 21 4 13.8 
XV  7.7 926 121  18 7 134  62 151  57 24 352 10.5 
XVI  3.6 1,871 1,045 20 252 146 288  31 19  44 17 9 6.6 
XVII  18.0 468 98 10 20 10 39 116   11 107 15 42 12.5 
XVIII  4.9 347 68 81 68 15 26  6 40  43    
XIX  1.6 28 25          1 2 15.0 
XX  10.2 233 7 16 1 1 46  13 31  57 43 18 14.6 
XXI  5.8 12 3    4  4     1 15.0 
Total 7.6 8,735 2,096 1,285 359 204 1,930 116 557 552 11 835 172 618 22.4 
 
a Combination of ad valorem  and specific duties. 
 
Source:  WTO estimates based on data provided by Indonesia. 
 
31. Chart III.2 shows a comparison of average du tiable rates in those HS Chapters where 
preferential duties remain at the end of the implem entation period.  The comparison is made between 
the average preferential and MFN rates for lines subj ect to preferential duties only.  As can be seen 
from Chart III.2, tariff peaks for the most part rema in in place with the exception of HS Chapter 87 
where the average preferential duty is less than half the MFN duty. 
 WT/REG241/1 
Page 14  
 
0102030405060708090100110120130140150
01
02
04
08
10
11
12
15
17
20
21
220102030405060708090100110120130140150
30
333839
47
66677172
73
74
768384
87
93959697Chart III.2
Indonesia: Average of dutiable rates, by HS Chapter
HS  01-24 HS 25-97Average rate of duty (%)  
Average rate of duty (%)  
HS Chapter HS Chapter
MFN Preferential*
Note: For tariff lines with non ad valorem components, only the ad valorem part of alternate rates are included in the calculati on;
          * Chapter 17 contains specific duty.Source :  WTO Secretariat estimates, based on data provided by Indonesia.
 
 
4. Japan's Liberalization Schedule 
32. Among the 8,912 tariff lines forming Japan's tariff schedule, 41.7% of tariff lines were 
already duty free on an MFN basis be fore the entry into force of the Agreement.  As can be seen from 
Chart III.3, most of the lines freed of duties in 2008 to 2023 are subject to rates of 10% or less.  The 
majority of lines subject to duties of up to 30% are liberalized in 2018 and 2023.  Lines subject to duties of more than 40% are not liberalized under the Agreement. 
  WT/REG241/1 
 Page 15 
 
 
0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000200820112013201520182023Chart III.3
Japan's duty elimination under the Agreement
Year of duty free treatment   
Source: WTO Secretariat estimates, based on data provided by Japan.Number of duty-free lines (cumulative)
Duty-free <10% <20% <3 0% MF N is: <40% Non ad valorem
 
 
33. Table III.4 shows Japan's trade liberalization commitments under the Agreement on the basis 
of products' treatment at the HS 9-digit level orga nized by HS section product categories.  Of the 
8,912 tariff lines forming Japan's tariff schedule, 3,714 tariff lines were already duty-free on an MFN basis in 2008;  the lines liberalized upon entry into force of the Agreement cover a broad range of 
HS sections.  Of the 962 lines which remain subject to duties, most are agricultural products.  The 
average final tariff on dutiable items ranges from 6.9% to 25.8%. 
Table III.4 
Japan: Tariff elimination under the Agreement, by HS section 
Number  of duty-free lines  
HS section  MFN 
avg. 
2008
% Total 
No of 
lines  MFN 
duty-
free 
2008  2008  2011  2013  2015  2018  2023  
Remain 
dutiable  
Avg. Final 
Tariff 
(Dutiable)  
I Live animals and animal 
products 8.4 508 109 43  35 27  4 290 13.2 a 
II Vegetable products 6.1 526 165 138  22 41 39 22 99 20.1 a 
III Animal or vegetable fats and 
oils 3.8 85 20 21  1 4 1  38 12.9 a 
IV Prepared foods etc. 16.4 761 77 49 1 13 53 85 48 435 22.3 a 
V Minerals 0.5 219 166 27 2 1 18  4 1 - 
VI Chemicals and chemical 
products 2.3 1,034 403 620  1 2   8 13.6 a 
VII Plastics and rubber 2.4 296 103 164 15  7 7    
VIII Hides and skins 10.4 196 66 3   67 32  28 17.7  
IX Wood and articles 3.4 233 83 121  3    26 6.9 
X Pulp, paper etc. 0.0 172 172         
XI Textiles and textiles article s 6.5 2,058 86 1,966      6 - 
XII Footwear, headgear 16.3 111 6 25   22 27  31 25.8  
XIII Articles of stone 1.1 160 100 58   2     
XIV Precious stones, etc. 1.3 80 58 14    8    
Table III.4 (Cont'd)  
 WT/REG241/1 
Page 16  
 
Number  of duty-free lines  
HS section  MFN 
avg. 
2008
% Total 
No of 
lines  MFN 
duty-
free 
2008  2008  2011  2013  2015  2018  2023  
Remain 
dutiable  
Avg. Final 
Tariff 
(Dutiable)  
XV Base metals and base metals 
products 0.9 842 604 226 7 1 2 2    
XVI Machinery 0.1 959 945 14        
XVII Transport equipment 0.1 147 146 1        
XVIII Precision equipment 0.2 294 285 6   3     
XIX Arms and ammunition 6.9 24  23    1    
XX Misc. manufactured articles 1.7 200 113 85   2     
XXI Works of art, etc. 0.0 7 7         
Total 4.8 8,912 3,714 3,604 25 77 250 202 78 962 18.4 
 
Note: Based on the HS 2002 nomenclature;  for  tariff lines subject  to TRQs only the out-of-quota duty is included in the tarif f-related  
 calculations. 
a Combination of ad valorem  and specific duties. 
- Specific duty 
 
Source:  WTO estimates based on data provided by Japan. 
 
34. Chart III.4, compiled as for Chart III.3, compares the average dutiable rates by HS Chapter at 
the end of the implementation period with MFN rates for Japan.  As can be seen from Chart III.4, for 
those HS Chapters where duties remain, the pref erential duties very closely match the MFN duties 
applicable for those tariff lines.   
05101520253035404550
1
2347
8
9
1011121315
16
171819
20
2122
23
2405101520253035404550
25
29
35
41
42
43
44
50
64Chart III.4
Japan: Average of dutiable rates, by HS Chapter
HS  01-24 HS 25-97Average rate of duty (%)  
Average rate of duty (%)  
HS Chapter HS Chapter
MFN Preferential* *
Note: For tariff lines with non ad valorem  components, only the ad valorem  part of alternate rates are included in the calculation; 
          * HS Chapters 25 and 50 contain specific duties.Source :  WTO Secretariat estimates based on data provided by Japan.
 
  WT/REG241/1 
 Page 17 
 
 
5. Tariff-rate quotas 
35. Japan maintains tariff-rate quotas (TRQs) on three tariff lines, two in HS Chapter 8 and one in 
HS Chapter 29.  Details of the quantities and rates applying to these lines are given in Table III.5.   
Table III.5 
Japan: Tariff-rate quotas for products originating in Indonesia 
HS Code (description) In quota 
rate Out of quota rate Quantity 
Bananas, including plantains, fresh or dried 
ex 080300100 Free 10% from April 1 to 
September 30; 20% from 
October 1 to March 31 1,000 MT in 2008-2013.  Subject to 
renegotiation in 2013. 
Dates, figs, pineapples, avocadoes, guavas, mangoes and mangosteens, fresh or dried
 
ex 080430010 Free 17% 100 MT in 2008, increasing annually 
by 50 MT until 2013.  Subject to 
renegotiation in 2013. 
D-glucitol (sorbitol) 
290544000 3.4% 16.4% in 2008, decreasing 
by 0.6% or 0.7% in 2008-
2015.  12% after 2015 25,000 MT in 2008-2013.  Subject to 
renegotiation in 2013. 
 
B. RULES OF ORIGIN  
36. Disciplines regarding rules of origin and custom s procedures are set out in Chapters 3 and 4, 
respectively.  Articles 29-40 deal with the rules of origin themselves, while Articles 41-50 cover 
certificate of origin and related procedures.  Article 28 contains definitions relating to rules of origin. 
37. The general requirements for a good to be c onsidered an originating good of a Party 
(Article 29.1) are:  
(a) wholly obtained or produced entirely in the Party;   
(b) produced entirely in the Party exclusively fro m originating materials of the Party;  or 
(c) produced entirely in the Party using non-originating materials which satisfy the 
product specific rules of Annex 2, and all other applicable requirements of Chapter 3. 
38. Part 2 of Annex 2 sets out specific criteria for non-originating materials to meet in order for 
the good to acquire originating status.  In the case of agricultural products, the specific rules in 
Annex 2 requires, in most cases, a change of HS Chapter (HS Chapters 1-14 and 16-21);  a change of 
HS chapter (2-digit), heading (4-digit)  or sub-heading (6-digit) is requi red for animal or vegetable fats 
and oils (Chapter 15), beverages, spirits and vine gar (Chapter 22), residues and wastes (Chapter 23) 
and tobacco (Chapter 24).11  
39. For industrial products, in the majority of cases,  origin is granted if the non-originating 
materials have undergone a change in tariff classificat ion (CTC) on the basis of HS chapters, headings 
or sub-headings.  In many cases, the qualifying value content (QVC) requirement is prescribed as an alternative formula.  The QVC requirement establis hes the minimum value of originating materials 
(not less than 40%) required in the good for it to be considered originating.  For chemical and plastic 
products (HS Chapters 28-40) a requirement of sp ecific manufacturing or processing operation in the 
form of a chemical reaction or purification, isomer separation or biotechnological process may apply 
in some cases.  In some cases of textiles (HS Chap ters 50-55 and 60) the dyeing or printing process is 
to be accompanied by two or more of the 48 different  operations identified in A nnex 2;  provided that 
certain processes, such as spinning, dyeing or weavi ng may be performed either in one of the Parties 
or in a non-Party which is a member country of ASEAN.  Also in the case of apparel 
                                                           
11 For some products in HS Chapters 22-23, a qualifying value content rules applies. WT/REG241/1 
Page 18  
 
(HS Chapter 61-63), certain processes, such as knitti ng, crocheting or weaving may be performed in 
one of the Parties or in a non-Party which is a member country of ASEAN. 
40. Article 31 establishes a de minimis  principle whereby a product is considered to be 
originating if all non-originating materials used in  its production that do not undergo an applicable 
CTC do not exceed specific percentages of value, wei ght or volume as set out in Annex 2.  For goods 
in Chapters 28-49 and 64-97, the applicable percen tage is 10% of the value of the good;  and for 
goods in Chapter 50 through 63, 7% of the weight  of the good.  Article 30 establishes cumulation 
which allows an originating good of a Party used as a material in the production of a good in the other 
Party to be considered as an originating material of the former Party.  
41. Articles 34-39 define how certain materials ( unassembled or disassembled goods;  fungible 
goods and materials;  indirect materials;  accessories , spare parts and tools;  packaging materials and 
containers for retail sale;  packing materials and containers for shipment) are to be treated/valued 
when determining the origin of a good for which tho se materials are used.  Article 32 contains a list of 
non-qualifying operations which do not confer origin.   
42. The Parties agree to the establishment of a S ub-Committee on Rules of origin responsible for 
the implementation and operation of the ch apter on rules of origin (Article 49). 
Box III.1:  Rules of Origin:  Basic Features at a Glance 
• Product specific criteria: 
-  Wholly obtained or entirely produced goods 
-  For most agricultural goods, a change of HS Chapter applies. 
-  For most industrial goods, a change of chapter, heading or sub-heading, or qualifying value content requirement (not less than 40%) applies. 
-  For some textile and apparel products, certain pro cesses may be performed either in one of the Parties 
or in a member of ASEAN. 
• Bilateral cumulation. 
• De minimis rule in terms of value or weight of the good (10% of value, or 7% of weight, depending on 
the good). 
 
C. EXPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  
43. Neither Party may introduce or maintain any non-tariff measures on the export or sale for 
export of any good destined for the other Party whic h are inconsistent with its obligations under the 
WTO Agreement (Article 23).  There are no provisi ons in the Agreement concerning export duties on 
goods.   
D. REGULATORY PROVISION S ON TRADE IN GOODS  
1. Standards 
(a) Sanitary and Phytosanitary Measures 
44. There are no provisions in the Agreement concerning the application of SPS measures.   
(b) Technical Barriers to Trade. 
45. There are no provisions in the Agreement concerning the application of TBT measures.     WT/REG241/1 
 Page 19 
 
 
2. Safeguard mechanisms 
(a) Global safeguard actions 
46. The parties may take global safeguard measu res in accordance with Article XIX of the 
GATT 1994 and the WTO Agreement on Safeguards,  or Article 5 of the WTO Agreement on 
Agriculture (Article 24.6). 
(b) Bilateral safeguard actions 
47. Each Party may take bilateral safeguard measur es to the minimum extent necessary to prevent 
or remedy the serious injury to its domestic industr y and to facilitate adjustment in the case of imports 
of originating goods of the other Party in such in creased quantities, in absolute terms or relative to 
domestic production, that constitute a substantial cause of serious injury or threat to its domestic 
industry (Article 24.1).12 
48. Bilateral safeguards may take the form of (a) suspension of the further reduction of customs 
duty on the originating good;  or (b) increased custom s duty to the level not to exceed the lesser of the 
applied MFN rate applied at the time when the safegua rd action is taken, and the MFN rate applied on 
the day immediately preceding the date of entry into force of the Agreement (Article 24.1).  Bilateral 
safeguard measures may not be applied on goods im ported up to the limit of quota quantities granted 
under tariff rate quotas applied in accordance with th e Parties' schedules in Annex 1 (Article 24.2). 
49. An investigation must in all cases be complete d within one year from the date of initiation 
(Article 24.3(b)).13  Bilateral safeguards cannot be imposed for more than four years, and can be 
extended up to a maximum period of five years in  very exceptional circumstances (Article 24.4(d)).14  
The measure must not be applied again to goods which have alread y been subject to a bilateral 
safeguard measure, for a period of time equal to th e duration of the previous measure or one year 
(compared to two years in the WTO Agreement on Sa feguards), whichever is l onger (Article 24.4(e)). 
50. Provisional measures may be taken in critical circumstances where delay would cause 
damage which would be difficult to repair.  The duration of provisional measures cannot exceed 
200 days, which shall be counted as a part of the ove rall period of the safeguard (Article 24.9).     
51. If necessary, the Parties shall review the bilateral safeguard provisions five years after the 
entry into force of the Agreement, i.e. July 2013 (Article 24.11).  
3. BOP safeguards 
52. Article 25 provides for the Parties to take measur es to safeguard the balance of payments in 
accordance with the conditions established un der Article XII of the GATT 1994, and the 
Understanding on the Balance-of-Payments Provisions of GATT 1994. 
4. Anti-dumping and countervailing measures 
53. The Parties retain their right to impose an anti-dumping or countervailing duty in accordance 
with the relevant provisions of th e WTO Agreements (Article 20.4). 
                                                           
12 Serious injury is defined in Article 17 as "a significant overall impairment in the position of a 
domestic industry" while threat of serious injury is defined as "serious injury that, on the basis of facts and not 
merely on allegation, conjecture or remo te possibility, is clearly imminent". 
13 There is no time period for the investig ation in the WTO Agreement on Safeguards. 
14 Under the WTO Agreement on Safeguards, the maximum period of application of (global) safeguard 
measures is eight years (Article 7.3). WT/REG241/1 
Page 20  
 
5. Subsidies and State-aid 
54. In Article 22 the Parties agree not to introduce or maintain any export subsidies on any 
agricultural good which is listed in Annex 1 to the WTO Agreement on Agriculture. 
6. Customs-related procedures 
55. Customs procedures related to rules of origin are detailed in Articles 41-50 and Chapter 4.  
Articles 41-50 lay out disciplines for documentation requi rements, verification of origin and denial of 
preferential treatment in case of non-compliance with the relevant requirements.  Annex 3 contains 
the minimum data requirement for the certificate of orig in.  The certificate of origin is to be issued by 
the government authority designated by the exporti ng Party, which may, in turn, designate other 
entities or bodies to be responsible for the issuance of  the certificate of origin.  Such entities or bodies 
are to be notified to the other Party in writing (Article 41).   
56. Chapter 4 contains provisions on transparency, customs clearance, and cooperation as regards 
customs procedures.  Article 56 provides for th e establishment of a Sub-Committee on Customs 
Procedures which is responsible for the review of the implementation and operation of customs 
procedures. 
IV. PROVISIONS ON TRADE IN SERVICES AND INVESTMENT 
A. S
COPE AND DEFINITIONS  
57. Trade in services is mainly governed by th e Chapter on Cross-Bord er Trade in Services 
(Chapter 6), which covers all four modes of suppl y found in the GATS.  The definition of trade in 
services is the supply of a service:  from the Area of a Party into the Area of the other Party;  in the Area of a Party to the service consumer of the other Party;  by a service supplier of a Party, through 
commercial presence in the Area of the other Party;   or by a service supplier of a Party, through 
presence of natural persons of that Party in the Area of the other Party (Article 77(u)). 
58. The liberalization of trade in services follo ws a "positive-list approach" whereby the 
obligations of market access (Artic le 78) and national treatment (Ar ticle 79) apply only to the sectors 
expressly listed in the schedules of specific commitments (Annex 8), subject to limitations and 
conditions listed therein (Article 81).  A Sub-Co mmittee on Trade in Services shall be established 
which is responsible for the implementation an d operation of the Chapter on trade in services 
(Article 91). 
59. Chapter 6 does not apply to:  measures affecting ai r traffic rights, other than aircraft repair 
and maintenance services, the selling and marke ting of air transport services, and computer 
reservation system services;  cabotage in maritime transport services;  subsidies;  measures affecting 
the movement of natural persons of a Party, unless otherwise provided in a schedule of specific 
commitments in Annex 8;  measures affecting natural persons of a Party seeking access to the employment market of the other Party or measures regarding nationality or residence or employment 
on a permanent basis;  and government  procurement (Article 76.2).   
60. The Agreement also contains a chapter on investment (Chapter 5) which covers all sectors, 
including services.  The chapter's liberalization moda lities follow a "negative-list approach"; while the 
national treatment obligations of both the investment  and services chapters apply to services sectors,  
in the event of any inconsistency between Chap ters 5 and 6 with respect to national and MFN 
treatment and prohibition of performance requireme nts, Chapter 6 prevails to the extent of 
inconsistency (Article 57.2).  Ch apter 5 also provides for an i nvestor-state dispute settlement 
mechanism (Article 69).  The tribunal may award, separately or in combination monetary damages  WT/REG241/1 
 Page 21 
 
 
and applicable interest;  and restitution of property if it finds in favour of the complaining investor 
(Article 69.18). 
61. Annex 7 provides supplementary provisions on fi nancial services.  It applies to measures 
affecting the supply of financial services in the four modes of supply of the GATS (Section 1.1).  
Financial services are defined to include all insura nce and insurance-related services, and all banking 
and other financial services (exc luding insurance) (Section 1.2).  The Annex's provisions on domestic 
regulation (Section 2) and recognition (Section 3) ar e in line with the relevant paragraphs in the 
GATS Annex on Financial Services.   
B. MARKET ACCESS  
62. The Agreement contains provisions on market  access along the lines of Article XVI of the 
GATS (Article 78).  
C. NATIONAL AND MFN  TREATMENT  
63. Articles 79 and 82 provide, respectively, for a Party to accord to services and service 
suppliers of the other Party treatment no less favour able than it accords, in like circumstances, to its 
own services and service suppliers (national treatme nt) and to services and service suppliers of any 
non-Party (MFN treatment).15  Annex 9 contains the lists of  MFN exemptions for Japan and 
Indonesia.  For Japan such exemptions relate to  the following sectors:  maritime freight forwarding 
services;  international shipping services;  energy services;  and fisheries related services.  For Indonesia MFN exemptions apply to all sector s and commitments under the ASEAN Framework 
Agreement on Services except certain sub-sectors in construction and related engineering services;  
and in insurance and securities.   
64. As regards the Chapter on Investment, Articles 59 and 60 provide for the Parties to accord 
national and MFN treatment respectively, in like circ umstances to investors of the other Party and to 
their investments, with resp ect to investment activities.
16 
D. MOVEMENT OF NAT URAL PERSONS  
65. Chapter 7 contains provisions on the movement of natural persons, particularly, the entry and 
temporary stay of natural persons who fall under one of the categories referred to in Annex 10.  It 
does not apply to measures affecting natural persons of a Party seeking access to the employment market of the other Party, nor to measures regard ing nationality, or residence or employment on a 
permanent basis (Article 92.2) and permits a Pa rty to apply measures to regulate the entry and 
temporary stay of natural persons of the other Part y, including those measures necessary to protect the 
integrity of, and to ensure the orderly movement of  natural persons across its borders.  Chapter 7 is 
not limited to services sectors and includes specifi c commitments with regard to investors.  
66. A Party grants entry and temporary stay to na tural persons of the other Party in accordance 
with Chapter 7 and its related Annex 10.
17  The categories of natural persons covered by Annex 10 
are:  short-term business visitors;  intra-corporate transferees;  investors;  natural persons of a Party 
                                                           
15 National treatment applies to those sectors inscribed in a Party's schedule of specific commitments as 
laid out in Annex 8.  The MFN treatment obligation applie s to all sectors, subject to the exemptions listed in 
Annex 9.  Thus, with the exception of exemptions liste d in Annex 9, any preferentia l market liberalization in 
services offered by the either Japan or Indonesia to a th ird party in the context of another RTA is automatically 
extended to the other Party. 
16 Investment activities are defined as the establishm ent, acquisition, expansion, management, conduct, 
operation, maintenance, use, enjoyment and sale or other disposition of investments. 
17 Applies only to nationals, not permanent residents of the Parties (Article 93). WT/REG241/1 
Page 22  
 
who engage in business activities on the basis of a personal contract with a public or private 
organization in the other Party;  natural persons of a Party who engage in supplying services as nurses 
or certified care-workers or related activities on the basis of a personal contract with a public or 
private organization in the other Party;  and, in  the case of Japan only, natural persons of Indonesia 
who engage in professional services in Japan.  Th e Parties cannot impose or maintain quantitative 
restrictions on these categories of persons unless ot herwise specified in Annex 10.  Those seeking 
entry and temporary stay may be required to obtain  a visa or its equivalent and must comply with 
immigration laws and regula tions of the other Party. 
67. The Parties agree to establish and make public ly available the requirements and procedures 
for application for a renewal of the period of temporar y stay, a change of status of temporary stay or 
an issuance of a work permit for natural persons of th e other Party, and to ensure that the fees charged 
on those applications do not in themselves represent an unjustifiable impediment to the movement of 
natural persons of the other Party (Article 95).  Th e period that persons in these categories may stay in 
the other Party is summarized in Table IV.1. 
Table IV.1 
Permitted Time Periods for Temporary Stay 
Category Japan Indonesia 
 Initial period 
of entry and 
stay Extension Initial period 
of entry and 
stay Extension 
1.  Business visitors 90 da ys Yes, but no indication 
of extension criteria  60 days Yes, but no indication 
of extension criteria 
2.  Intra-corporate transferees One or three 
years  Yes, but no indication 
of extension criteria  One year May be extended for 
not more than one year each time and not more 
than five times 
3.  Investors One or three 
years  Yes, but no indication 
of extension criteria  One year May be extended for 
not more than one year 
each time and not more 
than five times 
4.  Natural persons of a Party engaged in 
business activities on the basis of a personal 
contract with a public or private organization in the other Party
a One or three 
years Yes, but no indication 
of extension criteria  One year May be extended for 
not more than one year 
each time and not more than five years 
5.  Natural persons of a Party who engage in supplying services as nurses or certified care-
workers or related activities on the basis of a 
personal contract with a public or private organization in the other Party  
 
    
a) A qualified nurse of Indonesia who has 
obtained a specified diploma from an academy of nursing or graduated from a 
faculty of nursing of a university with total 
work experience as a nurse for at least two years One year 
 
  
 May be extended for 
the same period each time and not more 
than twice 
 Not applicable 
 
  
 Not applicable 
A qualified nurse of Japan after graduating 
from nursing course with total work 
experience as a nurse for at least two years Not applicable Not applicable One year May be extended for 
the same period each 
time and not more than 
twice 
b)  A natural person of Indonesia who has graduated from a faculty of nursing of a university, obtained a specified diploma from 
an academy of nursing, or obtained a 
specified diploma or higher degree and has 
been qualified as a certified careworker after 
completing appropriate training  One year May be extended for 
the same period each time and not more 
than three times Not applicable Not applicable 
Table IV.1 (Cont'd) 
  WT/REG241/1 
 Page 23 
 
 
Category Japan Indonesia 
A natural person of Japan who has graduated 
from a nursing course which requires at least 
three years’ study after completing high 
school education or its equivalent or completed at least two years’ academic course 
after completing high school education or its 
equivalence and satisfies requisite guidelines  Not applicable Not applicable One year May be extended for 
the same period each 
time and not more than 
three times 
c)  A natural person of Indonesia who has been qualified as a “Kangoshi (nurse)” or a 
“Kaigofukushishi (certified careworker)” 
during his or her stay  under paragraph a) or b) above, or after he or she was unable to be 
qualified as such during his or her stay under 
paragraph a) or b) above Up to three 
years Yes, but no indication 
of extension criteria Not applicable Not applicable 
A natural person of Japan who has been 
qualified as a nurse or a certified careworker  with necessary skills during his or her stay 
under paragraph a) or b) above, or after he or 
she was unable to be qualified as such during his or her stay under para graph a) or b) above Not applicable Not applicable One year May be extended every 
year 
6.  Natural persons of Indonesia who engage in professional services One or three 
years  Yes, but no indication 
of extension criteria  Not applicable Not applicable 
 
a In the case of Japan, this applies to natural persons of Indonesia engaging in  activities which require technology or 
knowledge at an advanced level pertinent to physical sciences, engineering or other natural sciences;  or activities 
which require knowledge at an advanced level pertinen t to human science including jurisprudence, economics, 
business management and accounting, or  which require ideas and sensitivit y based on the culture of a country 
other than Japan. 
Source : Annex 10 of the Agreement. 
68. In the case of nurses and certified careworkers the Parties may determine the maximum 
number of natural persons to whom entry and temporary stay is granted annually and who may stay in 
the other Party based on the granting of entry and tem porary stay under the applicable section.  In case 
of serious damage, or threat thereof, to the societ y or labour market of the Parties, they may suspend 
the implementation of this commitment.  The Parti es agree to notify each other of the ceilings set for 
nurses and certified careworkers and of any suspension of commitments.  
69. Transparency provisions require the Parties to publish an explanation of requirements and 
procedures for the application for entry and temporary stay and to ensure that  the fees charged for the 
issuance or renewal of work permits do not constitute  an obstacle to the movement of natural persons 
of the other Party (Article 95).18  Table IV.2 provides recent data on the movement of natural persons 
to Japan.  
Table IV.2 
Movement of Indonesian Natural Persons to Japan 
Categories 
Year Intra-corporate 
transferees Service providers/ persons responsible 
for setting up commercial presence Other categories of relevance in the 
context of the agreement Total 
2005 70 10,545 6 10,621 
2006 80 10,465 0 10,545 
2007 119 11,537 5 11,661 
Source: WTO Secretariat, based on data provided by Japan. 
 
                                                           
18 The relevant information is available on the following websites:  
http://www.mofa.go.jp/j_info/visit/visa/index.html  and www.nakertrans.go.id  WT/REG241/1 
Page 24  
 
70. The Agreement provides for the establishmen t of a Sub-Committee on the movement of 
natural persons which is respons ible for reviewing and monitori ng the implementation and operation 
of Chapter 7;  discussing any issues related to Chapte r 7;  adopting guidelines referred to in Annex 10;  
reporting the findings of the Sub-Committee to the Joint Committee;  and carrying out other functions as may be delegated by the Joint Committee (Article 96).   
E. D
ENIAL OF BENEFITS  
71. Under Articles 72 and 90, a Party may deny the bene fits of Chapters 5 and 6 to an investor or 
service supplier of the other Party if that investor/ service supplier is an enterprise or juridical person 
"owned" or "controlled" by investors/persons of a non-Party, and the denying Party does not maintain diplomatic relations with the non-Party or adopts or  maintains measures with respect to the non-Party 
that prohibit transactions with the enterprise or juridical person that would be violated or 
circumvented if the benefits of the relevant Chap ters were accorded to the enterprise or juridical 
person.  Further, subject to prior notification and consultation, a Party may deny the benefits of the 
two Chapters to an investor or a service supplier of the other Party if that investor/service supplier is 
an enterprise owned or controlled by persons of a non-Party, and has no s ubstantial business activities 
in the other Party.
19   
F. LIBERALIZATION COMMITMENTS ON TRADE IN SERVICES  
72. The schedules of specific commitments are contained in Annex 8, Parts 1 and 2 for Japan and 
Indonesia, respectively.  Each schedule specifies term s, limitations and conditions on market access;  
conditions and qualifications  on national treatment;  undertakings re lating to additional commitments;  
and where appropriate, the time-frame for implementa tion of such commitments (Article 81.1).  For 
some of the sectors or sub-sectors in which they have taken specific commitments in Annex 8, the 
Parties have agreed to lock in the existing situa tion so that it does not become more restrictive.  
Sectors or sub-sectors subject to this selective binding commitment are indicated by "SS" in the 
schedule of both Parties. Each Party also has agr eed on a clause that, in the sectors or sub-sectors 
indicated by "S" in Annex 8, it shall not change terms, limitations, conditio ns and qualifications on 
the rights concerning market access or national treatment so as to become more restrictive to a service 
supplier of the other Party who has exercised rights on the date of entry into force of the Agreement 
(Article 81.4).  The majority of sectors and sub-sect ors in Japan's schedule ar e subject to the former 
commitment, whereas for Indonesia it applies in only a few cases.   
73. Under Article 80, the Parties may negotiate add itional commitments with respect to measures 
affecting trade in services not subject to schedu ling, including those rega rding qualifications, 
standards or licensing matters.   
1. Japan 
(a) Horizontal commitments / exceptions 
74. Japan has no horizontal commitments under the Agreement.  Japan's horizontal limitation on 
mode 3 in its GATS schedule relates to discriminat ory subsidies for research and development.  
Japan's horizontal commitments in mode 4, other than that related to subsidies for research and 
development in its GATS schedule are replicated a nd expanded upon in the specific commitments for 
the movement of natural persons cont ained in Annex 10 of the Agreement. 
                                                           
19 An enterprise or juridical person is "owned" if 50% of its equity interests is beneficially owned by 
persons or an investor, while an enterprise or juridical person is "controlled" by persons or an investor if the 
person or investor has the power to name a majority of its directors or otherwise to legally direct its actions 
(Articles 58(b) and 77(f)).    WT/REG241/1 
 Page 25 
 
 
(b) Sector specific commitments / exceptions 
75.  For business services, under the Agreement Jap an has liberalized mode 2 and recognized 
criteria for advisory services on the law of jurisd iction, and added commitments for other legal 
services suppliers including judicial and administra tive scriveners, certified social insurance and 
labour consultants and land and house surveyors.  Japan has added a number of new commitments 
including urban planning and landscape architectural  services, medical and dental services, veterinary 
services, services provided by midwives, nurses, para-medical personnel and physiotherapists, 
research and development services, rental and leasing services without operators, and a number of subsectors under other business services such as technical testing and analysis services, and services incidental to agriculture, mining, manufacturing and energy distribution.  Under placement and supply 
services of personnel, Japan, under the Agreement,  indicates exempted occupations whereas its 
GATS schedule positively lists eligible occupations.  
76. For communications services, Japan has fully  liberalized correspondence-delivery services 
supplied by special correspondence delivery business subject to permission/registration requirements 
for related modes of transport services.  In tel ecommunications services, Japan has increased the limit 
of foreign capital participation in Nippon Telegra ph and Telephone to one third (up from a fifth in its 
GATS schedule), and incorporates and expands u pon the reference paper of the GATS through 
additional requirements in connection with the re ference interconnection offer.  Japan has added 
partial commitments (mode 2 only) in telegraph services, radio and television services and radio and 
television transmission services.   
77. For construction and related engineering services,  Japan has added a commitment for services 
related to mining in which it has fully liberalized mode 2 and partially liberalized mode 3.  For 
distribution services, Japan has fully liberalized co mmission agents services, wholesale trade services, 
retailing services and franchising services except fo r petroleum, petroleum products, alcoholic 
beverages, and services supplied at public wholesale ma rket;  and partially liberalized retail sales of 
motor fuel, and wholesale trade and retailing services of  steam and hot water.  In educational services 
Japan has removed the establishment requirement  for pre-school education services supplied by 
nursery schools, and has added a commitment for child  day-care services.  In environmental services, 
Japan has removed the limitation on the number of li censes issued for service suppliers of waste oil 
disposal at sea which it maintains in its GATS schedule.   
78. In financial services, Japan incorporates the GATS' Understanding on Commitments in 
Financial Services into its schedule under the Agre ement.  While no additional subsectors have been 
committed under the Agreement, some changes have been made compared to Japan's GATS schedule.  
Under insurance and insurance-related services, unde r modes 1 and 2, Japan has removed compulsory 
coverage by the government of reinsurance on compul sory automobile third party liability insurance 
and the prohibition on supply of insurance intermed iation services through an intermediary in Japan.  
Insurance intermediation services under the Agreem ent are subject to commercial presence for 
modes 1 and 2.  For banking and other financial services, Japan has removed the requirement that 
commercial presence for investment trust management services must be juridical persons established in Japan.   
79. For health related and social services, Japan  has added new commitments in other human 
health services and social services.  In recreational, cultural and sporting services, Japan has added new commitments in libraries, archives, museum a nd other cultural services a nd in sporting and other 
recreational services.  In other services not included elsewhere, Japan has added new commitments on 
washing, cleaning and dyeing services, laundry co llection services, hairdressing and other beauty 
services, and Indonesian spa services. 
 WT/REG241/1 
Page 26  
 
80. For transport services, Japan has added the sub-sector of rental of vessels with crew 
(excluding vessels flying the flag of Japan) under maritime transport services and liberalized modes 1-3 of international maritime transport servi ces.  Additional transport sectors committed under 
the Agreement comprise maritime auxiliary transp ort services covering maintenance and repair of 
vessels, maritime cargo handling services, container station and depot services, and maritime freight 
forwarding services;  internal waterways transport services covering maintenance and repair of 
vessels;  rail transport services covering passenger tran sportation, freight transportation, pushing and 
towing services, and supporting services for rail trans port services;  road transport services covering 
passenger transportation, rental of commercial vehicles with operator, and supporting services for 
road transport services,  pipeline transport covering transportation of fuels;  and services auxiliary to 
all modes of transport covering cargo-handling services, storage and warehouse services relating to 
petroleum and petroleum products, and freight transport agency services.   
2. Indonesia 
(a) Horizontal commitments / exceptions  
81. Indonesia's horizontal commitments and exceptions under the Agreement mirror those found 
in its GATS schedule except in mode 4 where the ma ximum stay of directors, managers and technical 
experts/advisors has been extended from two y ears subject to a one year extension (in its 
GATS schedule) to two years which can be extended for a maximum two times for two years each 
time.   
(b) Sector specific commitments / exceptions 
82. For business services, under professional services Indonesia has added commitments in legal 
services and engineering services (mould and dies,  and powder metallurgy).  Additional business 
services committed to under the Agreement compri se computer and related services, where 
consultancy services and software implementation have  been liberalized (subject to review three years 
after entry into force of the Agreement) and da ta base services have been added;  research and 
development services where interdisciplinary R&D h as been liberalized in modes 1-2;  and other 
business services where for project management services other than for construction, technical testing and analysis services, services incidental to ma nufacturing, and maintenance and repair services 
modes 1-2, and for the latter mode 3, have been liberalized;  and advertising services and rental and 
leasing services without operator relatin g to aircraft have been added.  
83. For communications services, the Agreement provides for expanded coverage and fewer 
limitations compared to Indonesia's GATS commitm ents.  In basic telecommunications services, 
foreign equity participation is raised from 35% to 40%.  Additional sub-sectors committed under the 
Agreement are:  facsimile services, private leased ci rcuit services, on-line information and data base 
retrieval, electronic data exchange, and enhanced/v alue-added facsimile services.  With respect to 
audiovisual services, which are uncommitted to in Indonesia's GATS schedule, commitments have 
been taken on motion picture and video tape pr oduction and distribution services, as well as on 
motion picture projection services.  No limitatio ns have been scheduled for these sectors under 
modes 1 and 2, and, for mode 3, foreign particip ation is permitted throug h joint ventures with a 
maximum of 40% foreign equity. 
84. For construction and related engineering services, the Agreement provides expanded 
coverage, and fewer lim itations, compared to Indonesia's GATS commitments.  The capital share of a 
limited liability enterprise that may be owned by fore ign partners has been rais ed to 55% compared to 
49% in its GATS schedule.  New sub-sectors added include gas fitting construction work, fire alarm 
construction work, burglar alarm construction work , and lift and escalator construction work.    WT/REG241/1 
 Page 27 
 
 
85. New sectors added under the Agreement are distribution services, covering both wholesale 
services (in which mode 3 is liberalized only fo r services supplied by Japanese companies established 
in Indonesia and having manufacturing activities there relating to the wholesale distribution of 
automobiles (excluding motor cycles), household electrical appliances, office machinery and 
construction machinery) and direct selling (which is liberalized for modes 1 and 2);  educational 
services, covering secondary, higher, adult and other e ducation services;  health related and social 
services covering hospital services;  tourism and tr avel related services c overing beverage serving 
services and spa services;  and transport services, where maritime cargo handling services and rental of vessel without crew have been added under maritime transport services. 
86. For financial services, Indonesia's commitments largely mirror its GATS commitments:  
mode 1 of factoring services has been liberalized;  and asset management has been extended to cover 
all forms of collective investment management (l imited to investment fund management under its 
GATS schedule). 
G. L
IBERALIZATION COMMITMENTS ON INVESTMENT  
87. The investment Chapter adopts a negative-list a pproach to the scheduling of liberalization 
commitments, such that the obligations of  national and MFN treatment, and performance 
requirements apply fully, except for any measure with respect to the sectors or matters specified in Annex 4 for which the central government of a Party,  a prefecture of Japan, or a province of Indonesia 
maintains a non-conforming measure on the date of entry into force of the Agreement.  Unlike typical 
negative-list agreements, Annex 4 lists the sect ors where measures incons istent with national 
treatment or MFN are maintained, but does not list the non-conforming measures themselves.  The 
Parties agree to notify such measures on the date of entry into force of the Agreement (Article 64.2).
20   
88. Sectors where existing non-conforming measures are maintained at the local level of 
government do not have to be listed, although they  are nevertheless bound, meaning they can be 
maintained but that new non-conforming measures, or  more restrictive ones, cannot be introduced.   
89. Each reservation in Annex 4 contains the followi ng elements:  the sector or matter to which 
the reservation relates, and the obligation( s) against which the reservation is taken.21  Article 64.2 
requires the Parties on the date of entry into for ce of the Agreement to notify the following:  the 
domestic or international industry classification codes, where applicable, to which the measure 
relates;  the level of government to which the m easure applies;  the obligations under the Agreement 
with which the measure does not conform;  the legal source of the measure;  and a succinct description of the non-conforming measure.   
90. Annex 5 sets out the sectors or matters for wh ich a Party reserves the right to maintain 
existing, or adopt new or more restrictive, measur es that do not conform to the obligations of national 
and MFN treatment, and performance requirements (Articles 64.4).  Article 64.4 provides for the 
Parties on the date of entry into force of the Agreem ent to notify the following:  the sector or matter, 
with respect to which the measure is maintained;  the domestic or international industry classification 
codes, where applicable, to which the reservation re lates;  the obligations under the Agreement with 
which the measure does not conform;  the legal sour ce of the measure;  and a succinct description of 
the non-conforming measure.  Subsequent amendmen ts to Annexes 4 or 5, or adoptions of new 
measures in Annex 5 are to be notified to the other Party (Article 64.6).   
                                                           
20 Notification of the measures took place on the date of  entry into force of the Agreement, i.e. 1 July 
2008 and are available on the following websites:  http://www.mofa.go.jp/policy/economy/fta/indonesia.html  
and http://ditjenkpi.depdag.go.id/index.php?module-ijepa  
21 Some reservations relate to mode 3 of services tr ade, while others are reservations for investment in 
other sectors. WT/REG241/1 
Page 28  
 
91. Article 63 prohibits performance requirements in relation to investments.  Neither Party may 
impose or enforce any of the following requirements,  in connection with investment activities of an 
investor of the other Party in its Area: 
(a) to export a given level or percentage of goods or services; 
(b) to achieve a given level or pe rcentage of domestic content; 
(c) to purchase, use or accord a preference to goods produced or services provided in its 
Area, or to purchase goods or services from natural or legal persons or any other 
entity in its Area; 
(d) to relate in any way the volume or value of imports to that of exports or to the amount 
of foreign exchange inflows associated with the investment; 
(e) to restrict sales of goods or services in its  Area that investments of the investor 
produce or provide by relating them to the volume or value of its exports or foreign 
exchange earnings; 
(f) to appoint, as executives or members of board of directors, individuals of any 
particular nationality; 
(g) to locate the headquarters of the investor fo r a specific region or the world market in 
its Area; 
(h) to achieve a given level or value of resea rch and development in its Area;  or  
(i) to supply to a specific region or the world market exclusively from its Area, one or 
more of the goods that the investor produces or  the services that the investor provides.  
92. The Parties reserve the right to condition the (c ontinued) receipt of advantages in connection 
with investment activities on compliance with any of the requirements laid out in (g) to (i) above. 
93. Each Party accords to investments of investors of  the other Party, fair and equitable treatment 
and full protection and security (Article 61).  Article  65 prohibits the expropria tion or nationalization 
of investments unless certain specific conditions are fu lfilled.  Under Article 67, each Party allows all 
transfers relating to investments in its Area except in certain specific circumstances, such as in the 
case of bankruptcy or criminal or penal offences. 
94. The obligations of national and MFN treatmen t, and prohibition of performance requirements 
do not apply to any measure which a Party ad opts with respect to government procurement 
(Article 64.9).   
95. The Agreement contains an exception for measur es taken for prudential reasons (Article 71), 
which has been modelled on the same provision cont ained in the GATS Annex on Financial Services. 
1. Japan 
96. In its Annex 4, Japan has undertaken a numb er of reservations for existing measures for 
17 different sectors or matters, mostly as regards national treatment and to a lesser extent for MFN treatment and performance requirements.  Such measures cover inter alia  air transport, banking, 
railway transport, road passenger transport,  security guard services and water transport 
(see Table IV.3).  Japan has also undertaken a number of reservations for future measures as listed in 
Annex 5 for 10 different sectors or matters, mostly in the form of national treatment or performance  WT/REG241/1 
 Page 29 
 
 
requirement reservations.  The sectors listed includ e the broadcasting industry, energy, fisheries, 
public law enforcement and correctional services and so cial services, and subsidies (see Table IV.4). 
Table IV.3 
Existing non conforming measures listed by Japan  
Sector, sub-sector or activity Reservation Description of existing measure 
Agriculture, Forestry and Fisheries and 
related services NT Prior notification requirement 
Banking NT Commercial presence (head offices) in Japan 
Heat Supply NT Prior notification requirement 
Telecommunications NT/PR Nationality limitations related to vo ting rights apply to Nippon Telegraph 
and Telephone (NTT) Corporation for the purposes of entering the name 
and address in its register of shar eholders – Nationality requirement for 
assuming the office of director or auditor of this corporation and NTT 
East Corporation and NTT West Corporation 
Telecommunications and Internet 
based services NT Prior notification requirement 
Drugs and medicines manufacturing 
Leather and leather products 
manufacturing NT Prior notification requirement 
Matters related to the nationality of a 
ship NT/PR Japanese nationality shall be given to  a ship whose owner is a Japanese 
national or a company established unde r Japanese law of which at least 
two-thirds of executives are Japanese nationals 
Mining NT Nationality requirement 
Oil Industry NT Prior notification requirement 
Security guard services NT Prior notification requirement 
Transport:   
− Air transport NT/MFN Prior notification and nationality  requirement for permission – 
authorization requirement for foreign air carriers 
− Aircraft service NT Prior notification and nationa lity requirement for permission 
− Registration of aircraft NT/PR Registration in the national regist ry subject to nationality requirement 
− Freight forwarding business NT/MFN/PR Registration requirement – permission shall be granted to non-nationals on 
the basis of reciprocity 
− Freight forwarding business using 
air transportation only NT/MFN/PR Freight forwarding businesses using a) air transportation within Japan are 
subject to nationality requirement;  b)  international air transportation is 
subject to registration/authorization requirement granted on the basis of 
reciprocity 
− Railway transport NT Prior notification requirement 
− Road passenger transport NT Prior notification requirement 
− Water transport NT Prior notification requirement except oceangoing/seagoing transport and 
ship leasing industry excluding coastwise ship leasing industry 
− Water transport NT/MFN Ships not flying the Japanese flag ar e prohibited from entering Japanese 
ports not open to foreign commerce a nd from carrying cargo or passengers 
between Japanese ports. 
Water supply and waterworks NT Prior notification requirement 
Source:  http://www.mofa.go.jp/polic y/economy/fta/i ndonesia.html . 
 
Table IV.4 
Future Non conforming measures listed by Japan  
Sector Reservation Description of measure 
Aircraft/space industry 
Arms and explosive 
manufacturing industry 
Energy industry 
Broadcasting industry NT/PR Right to adopt or maintain any measur e relating to investments in these industries 
Fisheries NT/MFN/PR Right to adopt or maintain any measure re lating to investment in fisheries in the 
territorial sea, internal waters, exclusive economic zone and contin ental shelf of Japan 
Land transaction NT/MFN With respect to acquisition or lease of land properties in Japa n, prohibitions or 
restrictions may be imposed by Cabinet Or der on foreign nationals  or legal persons, 
where Japanese nationals or legal persons  are placed under identical or similar 
prohibitions or restrictions in Indonesia. 
Source: http://www.mofa.go.jp/polic y/economy/fta/i ndonesia.html . 
 WT/REG241/1 
Page 30  
 
2. Indonesia 
97. In its Annex 4, Indonesia has undertaken a number of reservations for existing measures for 
100 different sectors or sub-sectors, all of which con cern national treatment reservations.  In the case 
of 12 of these sectors or sub-sectors, the reservations are subject to review three years after the Agreement's entry into force.  Rese rvations taken by Indonesia affect inter alia  travel agents, 
telecommunications services, business services, public  transportation, health care support services, 
property/real estate broker, and rental services for land transport (see Table IV.5).
22  Indonesia has 
also undertaken a number of reservations for future  measures as listed in A nnex 5 for 125 different 
sectors or matters, mostly in the form of national tr eatment or performance requirement reservations.  
The sectors listed include food catering, recrea tion and entertainment business, supporting health 
services, management and business consulting, inland water transport services, and air transport (see 
Table IV.6).23  
Table IV.5 
Existing Non conforming me asures listed by Indonesia 
Sector, sub-sector or activity  Sector, sub-sector or activity  
Small-Scale Electric Power Plant (up to 10 MW) Fi sheries by Fishing Vessel in a Size above 30 GT  
Travel Agent Pit Sand Mining 
Art Studio Pharmaceutical Wholesales 
Tourism Guide Service Raw Material Pharmaceutical Wholesales 
Business related to Non-Timber Forest  Products Traditional Medicine Industry 
In-Nature Swallow Nest Business General Medical Services 
Sawn Timber Industry Health Care Support Services (Ambulance Services) 
Primary Industry of Rattan Proce ssing Individual Medical Practitioner 
Semi-Finished Product Industry from Ma ngrove Residential Health Services and Basic Health Service Facilities 
Primary Industry of Non-wood Forest Products Health  Research Center/ Institute 
Catching of Wild Plants and Wild Life Animals Health  Supporting Services (Pest Control/Fumigation Services) 
Fisheries by using Fishing Vessel in a size up to 30 GT Private Maternity House  
Inland Water Fishing Pharma cist Profession Practice 
Fishery Products Processing Sm all-Scale Drugstore/Pharmacy 
Community Broadcasting Service ( LPK) of Radio and Tele vision Pension Fund 
Courier Services/Custody Services Rural Bank 
Telecommunications Services Syariah BPR  
Construction Services (Small-Scale Contractor) Money Changer 
Business Services/ Construction Consultant Services for Small-
Scale Private Broadcasting Services 
Business Services/ Construction Consultant Se rvices Subscribed Broadcasting Services 
Public Transportation Printed Press Company 
Water Transport in Small Scale  Retails Trading 
Salting, Drying and Boiling  Wholesales (Based on Fee or Contract)  
Manufacture of Yarn or Thread, made of Natural or Synthetic 
Fibre Wholesales and Retail Sales of Alcoholic Beverages 
Hand-made Batik Industry Trading Survey Services 
Rubber Processing by Smoking Property/Real Es tate Broker (Based on Fee or Contract) 
Industry of Hand-tools  Rental Services fo r Land Transport (Rental Without Operator) 
Manufacture of Glazed and N on-glazed Clay and Ceramic 
Products for Household Utilities Rental Services for Other Machineries and Equipments 
Motorcycle maintenance and reparation services Building Cleaning Services 
Manufacture of Traditional Handicr afts Other Cleaning Services 
Industry of Hand-made Hand-tools for Agricu lture Non-classified Company Services 
Brown Sugar Other Service Activities (Laundry, Barber Shop, Beauty Parlour) 
Processing of Foods made of Grains and Tuberoses Pr oduction of Weapons, Ammuniti on, Explosive Devices, and 
Armaments 
Peeling and Cleaning of Tuberoses Placement  of Indonesian Domestic Workers Abroad 
Industry of Drying and Pro cessing of Tobacco Worker S upplier Services (Registration, Recruitment and Other 
Formality Processes) 
Cultivation of rice, cassava, corn and ot her food crops Loan, Grant and Capital Participation offered by Indonesia to 
State-owned Enterprises 
Breeding and Farming of Pigs in  a Quantity not exceeding 125 
Pigs Subsidies  
Breeding and Farming of Non-pedigreed Chicken Form of Business Enterprise 
Table IV.5 (Cont'd)  
                                                           
22 For a description of the measures, please refer to  the webpage cited in the source of the table. 
23 For a description of the measures, please refer to  the webpage cited in the source of the table.  WT/REG241/1 
 Page 31 
 
 
Sector, sub-sector or activity  Sector, sub-sector or activity  
Processing Industry of Plan tation Products *Off-shore Oil and Gas Dr illing Services outside Eastern Area of 
Indonesia 
Plantation and Plantation Seedbed Industry in an Area less than 25 Ha *On-shore Oil and Gas Drilling Services 
Film Production *Operation a nd Maintenance Services for Oil and Gas Facilities 
Film Promotion-related Business *Engineeri ng Procurement Construction (EPC) Services 
Film Technical Services *Power Plant 
Film Distribution (Export, Import and Dist ribution) *Transmission of Electric Power 
Screening: Movie/Film Theatre  *Electric Power Consultant 
Recording Studio (Cassette, VCD, DVD, etc.) *Construc tion and Installation of Electric Power Instrument 
Utilization of Timber from Natural Forest *Maint enance and Operation of Electric Power Instrument 
Utilization of Water Environment in Forest Area *Devel opment of Technology of Power Plant Equipment Supplies 
Supply and Distribution (Export an d Import) of Seeds and Germs 
of Plantation Forest *Distribution of Electric Power 
Fisheries by fishing vessel in a size of  100 GT or more *Nuclear Power Plant 
 
Note: An "*" indicates that thes e reservations will be maintained  for three years after the date of entry into fo rce of the Agr eement and 
subject to review after the end of such three years' period. 
Source: http://www.mofa.go.jp/policy/economy/fta/indonesia.html . 
 
Table IV.6 Future Non conforming measures listed by Indonesia 
Sector, sub-sector or activity Reservation Sector, sub-sector or activity Reservation 
Cocoon/Silkworm Cocoon Business (Natural 
Silkworm)  PR Non-Leasing Financing 
 NT 
Bee Keeping Business PR Venture Capital NT 
Raw Rattan Business PR General Insurance Company NT 
Bamboo Business PR Life Insurance Company NT 
Eaglewood Business PR Reinsurance Company NT 
Seedlak Business PR Insurance Brokerage Company NT 
Alternative Food Plant (Sago) Business PR Reinsurance Brokerage Company NT 
Pine Resin Business PR Insurance Appraisal Company NT 
Resin Business PR Actuary Consultant Company NT 
Apocynaceae Business PR Insurance Agent Company NT 
Atsiri Oil Business PR Foreign Exchange Commercial Bank NT 
Breeding and Hatchery of Fish PR Non Foreign Exchange Commercial Bank NT 
Fishery Products Processing PR Syariah Bank NT 
Marketing and Distribution of Fish Pr oducts PR Money Market Brokerage NT 
Operator of Telephone-related Value-added 
Services PR Telecommunications Network Operator NT 
Multimedia Service Operator: Internet Acce ss  PR Multimedia Service Operator  NT 
Clove Cigarette, Plain Cigarette and Other 
Cigarette Industries PR Institute for Testing Telecommunications 
Instruments NT 
Preserved Fruits and Vegetables Industry PR Construction Services (Non Small-Scale 
Contractor) NT 
Foods Processing from Grains and Tuberoses PR  Business Services/ Construction Consultant 
Services for Non Small-Scale NT 
Printed Batik Industry PR Toll Road Operator NT 
Rattan Processing Industry for Semi-finished 
Products PR Public Water Treatment NT 
Industry for Finished Goods of Mangrove PR Primary and Secondary Education NT 
Atsiri Oil Industry PR Higher Education NT 
Industries of Goods from Clay for Building 
Materials PR Non-Formal Education 
 NT 
Silver Jewelry Industry PR Business a nd Management Consultation Services - 
Wood Boat Industry for Marine Recreation and 
for Fishing PR Direct Selling through Marketing Network 
Developed by Business Partner NT 
Agricultural Machines Manufacture Applying 
Medium Technology PR Inland Water Transport Services NT 
Other Handicraft Industry PR River and Lake  Transport Services with Boat less 
than 30 GT NT 
Industry of Nails, Nuts and Screws PR Port Op eration Services for Ri ver, Lake and Inter-
Island Transportation ( ASDP ) NT/PR 
Milk Powder and Sweetened Condensed Milk 
Processing Industry  PR General Cargos Transport Services 
 NT 
Agriculture, Plantation and Fishery Business in 
Transmigration Area PR Specific-Cargos Transport Services NT 
Table IV.6 (Cont'd)  WT/REG241/1 
Page 32  
 
Sector, sub-sector or activity Reservation Sector, sub-sector or activity Reservation 
Art Gallery NT Supporting Services at Terminal NT 
Art Performance Building NT Regular Domestic Air Transport NT 
Hotel (1-2 Stars) NT/PR Charte red Domestic Air Transport NT 
Non-Star Hotel NT/PR Regular In ternational Air Transport NT 
Other Accommodation Services (Motel and 
Lodging Services) NT/PR Special Air Transport NT 
Homestay/Similar Lodging NT/PR Airport-related Services NT 
Food Catering NT/PR Cargo Transpor tation Arrangement Services   
Spa NT/PR Air Forwarding Services NT 
Game Centre NT/PR General Sales Agent (GSA) of Foreign Airline 
Services NT 
Bar/Café/Singing Room (Karaoke) NT/PR S upporting Services for Flight Activities NT 
Restaurant NT/PR Domestic and International Sea Transport NT 
Recreation and Entertainment Busi ness NT/PR Loading/Unloading NT 
Travel Bureau (Inbound and Outbound Tour 
Operator)  NT/PR Port Facilities Services NT 
Professional Convention Organizer (PCO) NT/PR Provider of Port Waste Reception Facilities NT 
Impresario Services NT/PR Salvage Se rvices and/or In- Water Work NT 
Cultural Tourism Site Management NT/P R Car Maintenance and Reparation NT 
Natural Tourism Site Management outside 
Conservation Area NT Cultivation of Rice, Corn, Cassava and Other Food 
Crops over 25 Ha NT 
Carbon Trade - Seedling of Rice and Non-staple Food Crops NT 
Eco-tourism Services NT Plantation Business over 25 Ha without Processing 
Unit NT 
Hunting in Buru (hunting) Park and Buru 
(hunting) Block NT Processing of Plantation Products NT 
Breeding and Cultivating of Wild Plants and 
Animals NT Plantation Business over 25 Ha with Processing 
Unit NT 
Coral Breeding and Cultivation NT Plan tation Seedbed Indus try over 25 Ha NT 
Pharmaceutical Industry NT Plantation of  Palm over 25 Ha and/or Processing of 
its Products NT 
Private Hospital Services (Specialist/Sub-
Specialist)  NT/PR Raw Material Industry for Explosives (Ammonium 
Nitrate) NT/PR 
Specialized Medical or Dental Serv ices at Clinic NT Production of Explosives and its Component for 
Commercial Purposes NT/PR 
Supporting Health Services NT Placement of Indonesian Workers Domestically NT 
Other Hospital Services (Mental Rehabilitation 
Clinic) NT Job Training NT 
Nursing Services NT/PR Trading in Large-Scale - 
Testing Services for Calibration, and Maintenance 
and Reparation of Medical Equipment NT Breeding and Farming of Pigs (more than 125 
Pigs) PR 
Management and Business Consulting (Hospital 
Management Services) NT Technology Development by Utilizing Genes of 
Wild Plants and Animals PR 
Acupuncture Services NT Fisheries within EEZ by using Fishing Vessel in a 
Size of 100 GT or More PR 
Leasing NT   
Source: http://www.mofa.go.jp/polic y/economy/fta/i ndonesia.html . 
 
H. SAFEGUARD ACTIONS ON SERVIC ES TRADE AND INVESTMENT  
98. Article 89 provides that upon the conclusion of mu ltilateral negotiations pursuant to Article X 
of the GATS, the Parties will consider amending the Agreement.  In the event that the implementation 
of the Agreement causes substantial adverse impact to  a Party in a specific service sector prior to the 
conclusion of such multilateral negotiations, the Part y may request consultations with the other Party 
for the purpose of taking appropriate me asures to address such adverse impact. 
99. In the event of serious balance of payments and external financial difficulties or threat 
thereof, or where movements of capital cause or threaten to cause serious difficulties for 
macroeconomic management in par ticular, monetary and exchange rate policies, the Parties may 
adopt or maintain restrictions relating to cr oss-border capital transactions (Article 70), while 
Article 88 permits the Parties to adopt or maintain restrictions on payments or transfers related to 
trade in services.  Such measures are to be consiste nt with the Articles of Agreement of the IMF, not  WT/REG241/1 
 Page 33 
 
 
exceed those necessary, and be temporary in nature.  R estrictions related to trade in services are to be 
applied on an MFN basis.   
I. DOMESTIC REGULATION  
100. Article 83 calls on the Parties to endeavour to en sure that measures relating to authorizations, 
licensing or qualification of services suppliers of the other Party are: based on objective and 
transparent criteria, such as th e competence and the ability to supply the services;  not more 
burdensome than necessary to ensure the quality of  the services;  and do not constitute a disguised 
restriction on the supply of the service. 
J. RECOGNITION  
101. Where a Party recognizes the education, experien ce, licenses or certifications obtained in a 
non-Party, it is not bound to accord this treatment to the other Party.  The Party shall provide the other 
Party adequate opportunity to demonstrate that th e education or experience obtained, requirements 
met, or licenses or certifications granted in the other Party should also be recognized (Article 84.3).   
V. PROVISIONS AFFECTING TRADE IN GOODS, SERVICES AND INVESTMENT 
A. COMPETITION  
102. Chapter 11 contains provisions relating to competition.  The Parties agree to promote 
competition by addressing anti-competitive activities.  They agree to apply their competition laws and 
regulations in a manner which does not discrimin ate between persons in like circumstances on the 
basis of their nationality.  In addition, they agree to implement administrative and judicial procedures 
in a fair manner to address anti-competitive activities, pur suant to their relevant laws and regulations.   
B. GOVERNMENT PROCUREMENT  
103. Chapter 10 contains provisions relating to gove rnment procurement.  The Parties agree to 
respond in a timely manner to reasonable requests for information from the other Party on its laws and 
regulations, policies and practices, as well as any reforms to its existing government procurement regimes (Article 124).
24  No thresholds for government pr ocurement are established under the 
Agreement. 
104. Article 125 provides for the establishment of a Sub-Committee on Government Procurement 
whose functions include reviewing and monitoring th e implementation and operation of Chapter 10 of 
the Agreement;  exchanging views on laws and regula tions, policies and practices, and other mutually 
agreed issues regarding government procurement;  discussing ways to facilitate cooperation between 
relevant entities of the Parties;  reporting the find ings of the Sub-Committee to the Joint Committee;  
and carrying out other functions as may be delegated by the Joint Committee. 
C. INTELLECTUAL PROPERTY RIGHTS  
105. Chapter 9 of the Agreement contains provisions governing intellectual property.  The Parties 
agree to grant and ensure adequate, effective and non-discriminatory protection of intellectual 
property, promote efficiency and transparency in  the administration of the intellectual property 
protection system, and provide for measures for enfo rcement of intellectual property rights against 
infringement, counterfeiting and piracy (Article 1 06.1).  The Parties agree to accord each other 
national and MFN treatment in accordance with the TRIPS Agreement (Article 108).  In addition to 
                                                           
24 Japan is a signatory of the WTO Agreement on Government Procurement, Indonesia is not. WT/REG241/1 
Page 34  
 
the categories of IPR mentioned in the TRIPS Ag reement, the Parties provide protection for new 
varieties of plants (Article 116). 
106. A Sub-Committee on intellectual property is established under the Agreement which is 
responsible for reviewing and monitoring the impl ementation and operation of Chapter 9;  discussing 
any issues related to intellectual property with a vi ew to enhancing protection of intellectual property 
and enforcement of intellectual property rights and to promoting efficient and transparent 
administration of the intellectual property protection system;  exchanging views on the protection of genetic resources, traditional knowledge and folklo re, and on the liability of internet service 
providers;  reporting the findings of the Sub-Committee to the Joint Committee;  and carrying out other functions as may be delegated by  the Joint Committee (Article 123).   
D. E
NVIRONMENT  
107. In Article 74 the Parties recognize that it is  inappropriate to encourage investments by 
investors of the other Party by relaxing environmen tal measures.  The Parties agree not to waive or 
otherwise derogate from such environmental meas ures as an encouragement for the establishment, 
acquisition or expansion of investments in its Area. 
108. In Article 102 the Parties agree on the importance of avoiding or minimizing, in an 
economically efficient manner, harmful environmenta l impacts of all activities related to energy and 
mineral resources in its Area.   
E. SECTOR SPECIFIC PROVISIONS  
1. Energy and Mineral Resources 
109. Chapter 8 contains provisions relating to energy and mineral resource goods which are 
defined in Annex 11.  Provisions include the promo tion and facilitation of investment in this sector, 
import and export restrictions, export licensing procedures and energy and mineral resource 
regulatory measures.  In Article 105, the parti es agree to establish a Sub-Committee on Energy and 
Mineral Resources.  
F. INSTITUTIONAL PROVISIONS  
1. General Provisions and Exceptions 
110. General and security exceptions for goods and ser vices are maintained by incorporating into 
the Agreement mutatis mutandis  Articles XX and XXI of the GATT 1994 for goods25 and 
Articles XIV and XIV bis of the GATS for services-related issues (Article 11).26  Article 10 provides 
that the provisions of the Agreement do not apply to taxation measures.  However, for investment 
Article 73 (Taxation Measures as Expropriation) applies to taxation measures in certain 
circumstances. 
2. Accession 
111. There are no accession provisions in the Agreement.   
                                                           
25 For the purposes of trade in goods, rules of origin, customs procedures, investment (other than 
"Protection of Strife") and energy and mineral resources. 
26 For the purposes of investment (other than “Prot ection from Strife”), trade in services and movement 
of natural persons.  WT/REG241/1 
 Page 35 
 
 
3. Termination 
112. Either Party may terminate the Agreement by giving one year's advance notice in writing 
(Article 154).  
4. Institutional framework 
113. In Article 14 the Parties agree to establish a Jo int Committee, the functions of which include 
the following:  to review and monitor the impl ementation and operation of the Agreement;  to 
consider and recommend to the Parties any amen dments to the Agreement;  to supervise and 
coordinate the work of all sub co mmittees established under the Agreement. 
114. In Article 15 the Parties agree to the estab lishment of sub-committees on trade in goods;  
rules of origin;  customs procedures;  investment;  trade in services;  movement of natural persons;  
energy and mineral resources;  intellectual prope rty;  government procurement;  improvement of 
business environment and promotion of bus iness confidence;  and cooperation.   
115. Articles 3-7 deal with measures to enhance tran sparency in and between  the Parties.  The 
Parties must make publicly available their respectiv e laws, regulations and in ternational agreements 
(Article 3).  The Government of the Parties will en deavour to make public in  advance regulations of 
general application that affect any matter covere d by the Agreement and to provide a reasonable 
opportunity for comments by the public before adopti on of such regulations (Article 4).  Provisions 
are also made for administrative procedures (Article 5) ;  review and appeal (Article 6);  administrative 
guidance (Article 7);  and confiden tial information (Article 9).  In Article 16, the Parties agree to 
designate a contact point to fac ilitate communications between them. 
5. Dispute settlement 
116. Chapter 14 sets out procedures on the settlement of disputes between the Parties relating to 
the implementation and/or application of the Ag reement.  Article 138 provides a choice-of-forum 
clause for matters arising under both the Agreement and any other international agreement to which 
both Parties are parties.  Once the complaining Party has chosen the forum to settle the dispute, that 
forum shall be used to the exclusion of th e other forum (exclusive forum clause).   
117. Under Chapter 14, the Parties firstly seek to resolve disputes through consultations which are 
requested in writing (Article 140).  In the event that  consultations between the Parties fail to settle the 
dispute within 90 days after the date of receipt of the request for consultations (50 days in the case of 
perishable goods), the complaining Party may requ est the establishment of an arbitral tribunal 
(Article 142).  Table V.1 provides a synopsis of  the Agreement's Dispute Settlement Provisions. WT/REG241/1 
Page 36  
 
Table V.1:  Synopsis of the Agreement's Dispute Settlement Provisions 
 
118. Articles 142-144, deal respectively with the establishment, functions, and proceedings of 
arbitral tribunals.  The arbitr al tribunal meets in closed sess ion and its deliberations and the 
documents submitted to it are kept confidential (Article 144.1 and 144.3).  Where a Party has 
provided information or written submissions designa ted to be confidential, the other Party may 
request a non-confidential summary of the info rmation or written submissions which may be 
disclosed publicity (Article 144.4).  The award of the arbitral tribunal is final and binding on the 
Parties (Article 144.10). 
119. Article 69 provides for the settlement of investme nt disputes between a Party and an investor 
of the other Party.  In the case of a dispute an investor of a Party can request consultations or negotiations with the Party concerned.  Any matter, which is not resolved within five months from the 
date of written request for consultations, may be referred to international arbitration, such as the 
International Centre for Settlement of Investment  Disputes (ICSID) if the Convention is in force 
between the Parties;  or to the Additional Facility Rules of the ICSID if it is not;  to UNCITRAL;  or 
in accordance with other arbitration rules if agreed with the disputing Party.  Claims for arbitration 
must be notified in writing to the other Party at least 90 days before submission.  The arbitral award is 
final, binding and shall be executed without delay under the law of the Party concerned Request for Consultations (Art.140.1)
Establishment of Arbitral Tribunals (Art.142)
Issuance of Award (Art.144.8)
Notification of Implementation Period (Art.146.2)
Consultation on Compensation (Art.146.3) Referral to Arbitral Tribunal (Art.146.4)
Suspension of Concession (Art.146.6)Consultations (Art.140.2)
Consultation (Art.146.7)
Referral to Arbitral Tribunal (Art.146.7)Issuance of Award (Art.146.8)
Issuance of Award (Art.146.8) WT/REG241/1 
 Page 37 
 
 
(Article 69.19).  Annex 6 provides additional provisions with respect to the settlement of investment 
disputes.  
6. Relationship with other agreements concluded by the Parties 
120. The Agreement's relationship with other agreem ents concluded by the Parties is provided for 
in Article 12, where the Parties reaffirm their ri ghts and obligations under the WTO Agreement or any 
other agreements to which both Parties are parties.   
121. Table V.2 lists all other regional trade agreem ents (RTAs) notified and not notified to the 
GATT/WTO and in force to which Indonesia and Japan are party. 
Table V.2:  Japan and Indonesia:  Participation in other RTAs (notified and non-notified in force), as of June 2009  
GATT/WTO Notification 
Partner/ 
Agreement Date of 
entry 
into 
force Type of 
agreement 
Year WTO Provision 
JAPAN 
Philippines 11.12.08 Goods & Services 2008 GATT Art. XXIV & GATS Art. V 
Brunei Darussalam 31.07.08 Goods & Services 2008 GATT Art. XXIV & GATS Art. V 
Thailand 01.11.07 Goods & Services 2007 GATT Art. XXIV & GATS Art. V 
Chile 03.09.07 Goods & Services 2007 GATT Art. XXIV & GATS Art. V 
Malaysia 13.07.06 Goods & Services 2006 GATT Art. XXIV & GATS Art. V 
Mexico 01.04.05 Goods & Services 2005 GATT Art. XXIV & GATS Art. V 
Singapore 30.11.02 Goods & Services 2002 GATT Art. XXIV & GATS Art. V 
ASEAN * Goods & Services Not notified 
INDONESIA 
ASEAN Agreements:     
 ASEAN-China 01.07.07 Services 2008 GATS Art. V 
 ASEAN-China 01.07.03 Goods 2004 Enabling Clause 
 AFTA 28.01.92 Goods 1992 Enabling Clause 
 ASEAN-Rep. of Korea * Goods & Services Not notified 
 ASEAN-Japan * Goods & Services Not notified 
GSTP 19.04.89 Goods 1989 Enabling Clause 
* Not yet in force for all Parties.  Dates of entry into force differ. 
 
AFTA: ASEAN Free Trade Area GSTP: Global System of Trade Preferences 
Source: WTO Secretariat.  
 WT/REG241/1 
Page 38  
 
ANNEX  
 
Indicators of trade liberalization under the Japan-Indonesia FTA
 
 
 
1. A comparison between the scheduled elimination of tariffs applied to the Parties' mutual 
imports and the duty rates applied by them to MF N imports is shown in Tables A.1 (Indonesia) and 
A.2 (Japan) below, by agricultural (WTO defin ition), non-agricultural and total products.  Applied 
MFN duty rates in 2008 serve as a comparison. 
2. Indonesia has a variable MFN tariff structure.  Its (unweighted) average MFN rate (2008) is 
7.6% on all goods, with a higher average tariff app lied to agricultural goods than to non-agricultural 
products.  24% of Indonesia's tariff lines are duty-free at an MFN level.  On entry into force of the 
Agreement, Japan's exporters enjoyed a relative ma rgin of preference of 38.6% on non-agricultural 
products vis-à-vis  the prevailing average MFN tariff in 2008 and a relative margin of preference of 
11.6% in agricultural goods.  By the end of the transition period in 2023, these margins of preference 
are to increase to 91.4% and 41.6%, respectively, while the share of duty-free lines is expected to 
increase to 92.9%.  
Table A.1 
Indonesia: Indicators of MFN tariff rates an d preferential rates for imports from Japan 
ALL PRODUCTS Agricultural products a Non-agricultural products 
Average applied 
tariff Average applied 
tariff Average applied 
tariff Origin 
of goods Year 
Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff 
lines (%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) 
MFN 2008 7.6 10.0 24.0 11.3 13.1 13.1 7.0 9.4 25.4 
Japan 2008 5.1 8.3 38.7 10.0 13.2 24.0 4.3 7.3 40.7 
 2009 4.3 7.4 42.8 9.2 12.2 24.0 3.5 6.5 45.5 
 2010 3.5 6.5 45.2 8.5 11.3 24.0 2.8 5.4 48.2 
 2011 2.9 8.9 67.2 7.8 18.9 57.8 2.2 7.0 68.6 
 2012 2.5 7.9 68.6 7.6 18.3 57.8 1.7 5.8 70.1 
 2013 2.2 9.0 75.0 7.3 21.0 64.1 1.5 6.3 76.6 
 2014 2.1 8.4 75.0 7.2 20.5 64.1 1.3 5.6 76.6 
 2015 1.9 10.3 81.3 7.0 26.7 72.7 1.2 6.6 82.6 
 2016 1.7 9.5 81.4 6.9 26.3 72.7 0.9 5.5 82.7 
 2017 1.6 8.9 81.4 6.8 25.9 72.7 0.8 4.9 82.7 
 2018 1.5 18.0 91.0 6.7 46.1 84.3 0.7 9.7 92.0 
 2019 1.5 17.8 91.0 6.7 46.1 84.3 0.7 9.5 92.0 
 2020 1.5 17.6 91.0 6.7 46.0 84.3 0.7 9.2 92.0 
 2021 1.4 17.4 91.0 6.6 45.9 84.3 0.7 9.0 92.0 
 2022 1.4 17.2 91.0 6.6 45.8 84.3 0.6 8.8 92.0 
 2023 1.4 22.4 92.9 6.6 50.3 85.6 0.6 11.8 94.0 
 
a WTO Definition. 
 
Source:  WTO Secretariat estim ates based on data provided by Indonesia. 
 
3. Japan's average applied MFN rate in 2008 was 4.8%;  the average applied tariff on 
agricultural products was more than three times highe r than that applied to non-agricultural products.  
Duty-free tariff lines account for 41.7% of all tariff lin es.  Indonesian exporters enjoyed an absolute 
margin of preference of 1.5% for agricultural goods vis-à-vis  the prevailing average MFN tariff in 
2008, and 2.8% for non-agricultural goods.  Overall, Indonesian exporters enjoyed an average margin 
of preference of 2.6% vis-à-vis the prevailing average applied MFN tariff, as well as an increase 
to 82.1% in the share of Japan's duty-free lines.  By the end of the transition period in 2023, these 
figures will increase to 3.2% and 89.2%. 
 
  WT/REG241/1 
 Page 39 
 
 
Table A.2 
Japan: Indicators of MFN tariff rates and pr eferential rates for imports from Indonesia 
ALL PRODUCTS Agricultural products a Non-agricultural products 
Average applied 
tariff Average applied 
tariff Average applied 
tariff Origin of 
goods Year 
Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff 
lines (%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) 
MFN 2008 4.8 8.3 41.7 11.3 15.8 25.6 3.4 6.2 45.6 
Indonesia 2008 2.2 14.1 82.1 9.8 18.1 40.6 0.6 8.2 92.2 
 2009 2.2 13.7 82.1 9.6 17.7 40.6 0.6 7.8 92.2 
 2010 2.1 13.3 82.1 9.4 17.3 40.6 0.6 7.4 92.2 
 2011 2.0 13.1 82.4 9.2 16.9 40.7 0.5 7.2 92.5 
 2012 2.0 12.7 82.4 9.0 16.5 40.7 0.5 6.8 92.5 
 2013 1.9 13.0 83.3 8.7 16.7 42.7 0.5 6.9 93.1 
 2014 1.9 12.6 83.3 8.5 16.4 42.7 0.4 6.6 93.1 
 2015 1.8 14.9 86.1 8.3 18.1 48.2 0.4 8.6 95.1 
 2016 1.8 14.6 86.1 8.2 17.8 48.2 0.4 8.3 95.1 
 2017 1.7 14.3 86.1 8.0 17.5 48.2 0.4 8.1 95.1 
 2018 1.7 17.3 88.3 7.9 20.9 55.6 0.4 9.9 96.1 
 2019 1.7 17.2 88.3 7.8 20.8 55.6 0.4 9.9 96.1 
 2020 1.7 17.1 88.3 7.8 20.6 55.6 0.4 9.9 96.1 
 2021 1.7 17.0 88.3 7.7 20.5 55.6 0.4 9.9 96.1 
 2022 1.7 16.9 88.3 7.7 20.3 55.6 0.4 9.9 96.1 
 2023 1.6 18.4 89.2 7.6 23.1 60.0 0.4 9.9 96.1 
 a WTO Definition. Note:  For tariff lines subject to TRQs only the out-of-quota duty  is included in the tariff-related calculations;  lines with specific duties 
 and the non ad valorem  component of lines with compound and altern ate rates are excluded from the calculations. 
 
Source:  WTO Secretariat estimates based on data provided by Japan. 
 
4. Table A.3 shows the market access opportunities in Indonesia for Japan's top 25 exports, 
which in 2004-2006 accounted on av erage for 34.5% of Japan's global exports.  The table shows at 
which year all HS 10-digit tariff lines corresponding to the product definition (i.e. applying to the 
6-digit HS code used to capture the volume of trade) will become duty-free in Indonesia. 
5. Japan's top 25 exports cover a total of 234 HS 10-digit tariff lines.  Thirteen of Japan's top 
25 exports, accounting for 87 tariff lines and 10.9% of Japan's average global exports already 
benefited from zero MFN duties in Indonesia's ma rket:  no products are granted duty-free access in 
2008 to 2010;  between 2011 and 2023, eight produ cts (accounting for 67 tariff lines and 8.5% of 
Japan's average global exports) gain duty-free access.   Four products - motor cars and vehicles, of 
varying cylinder capacity - remain subject to duties.  The margin of preference granted to Japan by 
Indonesia under the Agreement varies from 1.3 to 38.9 percentage points. 
Table A.3 – Market access opportunities in Indone sia under the Agreement for Japan's top 25 exports 
Access Conditions to Indonesia's import markets  
MFN (2008)  Japan's top export products in 2004-2006  No. of tariff 
lines  Duty-free in  
HS number and description of the 
product  Share 
in 
global 
exports 
(%) Avg. 
applied 
rate 
(%) 
Duty-free 
Dutiable 
2008 
2009 2010 
2011 
2012 
2015 
2016 
2018 
2023 
Remain 
Dutiable  
870323 Motor cars and other motor 
vehicles, of a cylinder 
capacity > 1,500 cc but < 
3,000 cc 3.8 34.7  33     15    14 4 
870324 Motor cars and other motor 
vehicles, of a cylinder 
capacity > 3,000 cc 2.2 38.9  9     9      
Table A.3 (Cont'd)  WT/REG241/1 
Page 40  
 
Access Conditions to Indonesia's import markets  
MFN (2008)  Japan's top export products in 2004-2006  No. of tariff 
lines  Duty-free in  
HS number and description of the 
product  Share 
in 
global 
exports 
(%) Avg. 
applied 
rate 
(%) 
Duty-free 
Dutiable 
2008 
2009 2010 
2011 
2012 
2015 
2016 
2018 
2023 
Remain 
Dutiable  
870322 Motor cars and other motor 
vehicles, of a cylinder capacity > 1,000 cc but < 
1,500 cc 2.0 30.8  6     3  1   2 
852580 Television cameras, digital 
cameras and video camera   
recorders 1.5 6.0 1 4  2    2     
870840 Gear boxes and parts 
thereof 1.3 15.0  9 8   1       
852990 Parts suitable for use solely 
or principally with the 
apparatus of headings 85.25 to 85.28 1.2 0.0 11            
854239 Other electronic integrated 
circuits 1.2 0.0 1            
890190 Other vessels for the 
transport of goods and for 
the transport of both persons and goods 1.1 0.0 9            
851770 Facsimile machines and 
teleprinters, parts 1.0 0.0 10            
844399 Parts and accessories other 
than printing machinery 
used for printing by means of plates, cylinders and 
other printing components 
of heading 84.42 0.9 0.0 4            
848620 Machines and apparatus for 
the manufacture of 
semiconductor devices or of electronic integrated circuits 0.9 1.7 14 7  5 1 1       
854231 Processors and controllers, 
whether or not combined with memories, converters, logic circuits, amplifiers, 
clock and timing circuits, or 
other circuits 0.9 0.0 1            
854232 Memories 0.8 0.0 1            
842952 Machinery with a 360° 
revolving superstructure 0.8 10.0  1      1     
870332 Motor cars and other motor 
vehicles, of a cylinder 
capacity > 1,500 cc but < 2,500 cc 0.7 31.5  13     9  2   2 
854140 Photosensitive 
semiconductor devices 0.7 0.0 3            
271019 Other petroleum oils and 
oils obtained from 
bituminous minerals, crude 0.7 1.3 12 4         4  
854233 Amplifiers 0.7 0.0 1            
840991 Parts suitable for use solely 
or principally with spark-ignition internal combustion 
piston engines 0.7 0.0 41            
890120 Tankers 0.6 0.0 2            
381800 Chemical elements doped 
for use in electronics, in the 
form of discs, wafers or similar forms 0.6 0.0 1            
Table A.3 (Cont'd)   WT/REG241/1 
 Page 41 
 
 
Access Conditions to Indonesia's import markets  
MFN (2008)  Japan's top export products in 2004-2006  No. of tariff 
lines  Duty-free in  
HS number and description of the 
product  Share 
in 
global 
exports 
(%) Avg. 
applied 
rate 
(%) 
Duty-free 
Dutiable 
2008 
2009 2010 
2011 
2012 
2015 
2016 
2018 
2023 
Remain 
Dutiable  
870333 Other vehicles, of a cylinder 
capacity > 2,500 cc 0.6 32.3  11     9   2   
870422 Motor vehicles for the 
transport of goods, g.v.w. > 
5 tonnes but < 20 tonnes 0.5 31.1  14     5     9 
870829 Parts and accessories of 
motor vehicles of headings 
87.01 to 87.05, other 0.5 15.0  9    3    6   
847330 Parts and accessories of the 
machines of heading 84.71 0.5 0.0 2            
Total of above 34.5  114 120 8 7 1 5 50 3 3 8 18 17 
 
Source:  WTO estimates based on data provided by  Indonesia and UNSD, Comtrade data. 
 
6. Table A.4 shows the market access opportuniti es in Japan for Indonesia's top 25 exports, 
which in 2005-2007 accounted on average for 48.5% of  its global exports.  The table shows at which 
year all HS 9-digit tariff lines corresponding to th e product definition (i.e. applying to the 6-digit 
HS code used to capture the volume of trade) will become duty-free in Japan. 
7. Indonesia's top 25 exports cover a total of 88 HS 9-digit tariff lines.  Eighteen of Indonesia's 
top 25 exports, accounting for 32 tariff lines and 40.1%  of Indonesia's average global exports already 
benefited from zero MFN duties in Japan's market:  f our products, accounting for five tariff lines and  
6.1% of Indonesia's average global exports are granted duty-free access in 2008;  one product is 
granted duty-free access in 2015 and another in 2023.  One product – other sports footwear –  remains 
subject to duties.  The margin of preference grante d to Indonesia by Japan under the Agreement varies 
from 1.0 to 3.5 percentage points. 
Table A.4 – Market access opportunities in Japan under the Agreement for Indonesia's top 25 exports 
Access Conditions to Japan's import markets  
MFN (2008)  Indonesia's top export products in 2005-2007  
No. of tariff lines  Duty-free in  
HS number and description of the product  Share in 
global  
exports MFN 
average  Duty-
free Dutiable 2008 2015 2023 
Remain 
Dutiable  
271111 Natural gas 10.0 0.0 1      
270900 Petroleum oils and oils obtained from 
bituminous minerals, crude. 8.7 0.0 2      
270112 Bituminous coal 4.2 0.0 5      
260300 Copper ores and concentrates. 3.8 0.0 1      
400122 Technically specified natural rubber 
(TSNR) 3.0 0.0 1      
151190 Other crude oil 2.7 3.0  2 2    
151110 Crude oil 1.9 3.5  1 1    
847160 Input or output units, whether or not 
containing storage units in the same housing 1.2 0.0 4      
750110 Nickel mattes 1.1 0.0 1      
470329 Chemical wood pulp, non-coniferous 1.0 0.0 1      
030613 Shrimps and prawns 1.0 1.0  1 1    
640319 Other sports footwear 0.9 28.5  2    2 
800110 Tin, not alloyed 0.9 0.0 1      
940360 Other wooden furniture 0.9 0.0 3      
270119 Other coal 0.9 0.0 2      
Table A.4 (Cont'd)  WT/REG241/1 
Page 42  
 
Access Conditions to Japan's import markets  
MFN (2008)  Indonesia's top export products in 2005-2007  
No. of tariff lines  Duty-free in  
HS number and description of the product  Share in 
global  
exports MFN 
average  Duty-
free Dutiable 2008 2015 2023 
Remain 
Dutiable  
847330 Parts and accessories of the machines 
of heading 84.71 0.8 0.0 3      
852540 Still image video cameras and other 
video camera recorders; digital cameras 0.7 0.0 1      
271099 Other waste oils 0.6 0.0 1      
271091 Containing polychlorinated biphenyls 
(PCBs), polychlorinated terphenyls 
(PCTs) or polybrominated biphenyls 
(PBBs) 0.6 0.0 1      
271019 Other petroleum oils and oils obtained 
from bituminous minerals, other than 
light oils 0.6 2.2 9 22 7 11 4  
271011 Light oils and preparations 0.6 1.3 5 11 4 7   
401110 New pneumatic tyres, of a kind used 
on motor cars (including station wagons and racing cars) 0.6 0.0 2      
180100 Cocoa beans, whole or broken, raw or 
roasted. 0.6 0.0 1      
090111 Coffee, not decaffeinated 0.5 0.0 1      
151321 Crude oil 0.5 1.3 2 1 1    
Total of above  48.5  48 40 16 18 4 2 
Source:  WTO estimates based on data provided by Japan and UNSD, Comtrade data. 
 
_________