WORLD TRADE  
ORGANIZATION  G/LIC/Q/IDN/13 
6 April 2009 
 (09-1676) 
Committee on Import Licensing Original:   English 
  
 
NOTIFICATION UNDER ARTICLES OF THE AGREEMENT ON  
IMPORT LICENSING PROCEDURES FROM INDONESIA
1 
 
Replies from INDONESIA to Ques tions from the UNITED STATES2 
 
 
 The following communication, dated 23 March 2009, has been received from the delegation of 
Indonesia.  
_______________ 
 
 
1. In G/LIC/Q/IDN/6, in reply to questions from Australia, Indonesia indicated that regulations 
establishing import licensing procedures for sugar are contained in Decree No. 
643/MPP/Kep/9/2002, dated 23 September 2003.  
 
• Has Indonesia notified this regulation to the Committee, as required by Article 5 of the 
Agreement?  If not, why not?  When does Indonesia plan to do so?  
 
• Is this regulation still the primary basis of  Indonesia’s import licensing regime for sugar?  
Are there other regulations, amendments, or d ecrees that establish administrative procedures 
as a precondition for the importation of sugar in to Indonesia?  If so, please identify them and 
notify them to the Committee . 
 
Answer
: 
 
• Indonesia has not notified this decree.  The Decree No. 643/MPP/Kep/9/2002 has been revoked 
and replaced by the Decree of the Ministry of Industry and Trade No. 527/MPP/Kep/9/2004, 
which is the primary basis for the import sugar regime. 
 
• Indonesia will notify Decree of the Ministry of  Industry and Trade No. 527/MPP/Kep/9/2004 
together with its amendments of the regulation to the Committee. 
 
2. We would appreciate further clarification re garding Indonesia’s import licensing procedures 
for sugar and their application, including:  
 
• The information that must be provided in an application for an import license.  
 
• The criteria used in analyzing license applicat ions and the specific procedures followed by 
Indonesia in granting and/or allocating sugar im port licences and why these criteria were 
selected . 
 
                                                      
1 See Understanding on procedures for th e Review of Notifications (G/LIC/4). 
2 G/LIC/Q/IDN/9/Add.1 G/LIC/Q/IDN/13 
Page 2  
 
  • In cases where the import license application is  not approved, how the importer can appeal 
the decision?  
 
• For the last quarter of 2008, how many im port license applications for refined sugar, 
including plantation white sugar, were received.  How many were denied, and why?  How 
many have been approved? 
 
Answer
: 
 
• The information that must be provided in the a pplication for an import licence is:  quantity of 
sugar to be imported;  specifi cation and grade of sugar concerned;  port of exportation;  and 
recommendation from the Ministry of Industry. 
 
• The basic criteria used in analysing import li cence applications includes the types of sugar 
locally produced in terms of specification and grade;  availability in terms of supply and 
demand, suitability for differ ent processes and end users. 
 
• The criteria provides the basis to determine su rpluses within the domestic industry and where 
such surpluses are found to exist, import licences may not be granted for the same 
specification and grade of domestic sugar production.   In general, no application is rejected 
by the Ministry of Trade provided that all requirements are met including the 
recommendation from the Ministry of Industry.  As a consequence, if an application is rejected the importer should appeal to the Ministry of Industry 
 
• For the last quarter of 2008 the Ministry of Trade received 41 applica tions and all approved. 
 3. In a bilateral communication, Indonesia referred  the United States to two documents the 
Decree of the Minister of Industry and Trade No. 527/MPP/Kep/9/2004 concern ing provisions on the 
Import of Sugar as well as the F ifth Amendment of that Decree as contained in Regulation of the 
Minister of Trade No. 19/M-DAG/PER/2008 dated 29 May 2008.  Has Indonesia notified these 
decrees to the Committee?  If not, why not?  When does Indonesia plan to do so?  
 Answer
 
 - Indonesia has not notified this decree.  The decree number 643/MPP/Kep/9/2002 has been 
revoked and replaced by the Decree of the Ministry of Industry and Trade 
No. 527/MPP/Kep/9/2004, which is the primary basis for the import sugar regime. 
 
- Indonesia will notify Decree of the Ministry of Industry and Trade No. 527/MPP/Kep/9/2004 
together with its amendments the regulation to the Committee. 
 
4. The United States is concerned that implemen tation of these decrees has led the government 
of Indonesia to ban the importation of sugar duri ng certain periods and to restrict the quantity of 
sugar imported overall through the denial of import license applications.  Article 7, paragraph 2 of 
Regulation of the Minister of Trade No. 19/M-DAG/PER/2008 appears to state that plantation white sugar is permitted only during certain periods of the year and then only under certain circumstances, 
i.e. based on an assessment of domestic price and pr oduction levels.  Article 7, paragraph 6 states 
that the “amount of sugar to be imported to meet domestic requirement shall be determined based on 
the result of coordination meeting between the rel ated agencies/institutions and associations…”.  
  G/LIC/Q/IDN/13 
 Page 3 
 
 
  • What coordination meetings are referred to in Article 7?  Who chairs and who attends these 
meetings?  Do Indonesian refiners or other sugar consumers or their representatives 
participate in these coordination meetings?  
 
• Please confirm per the provisions of Article 7, sub-articles 4, 5, and 6, that this coordination 
process determines : 
 
(a) the projected quantity of domestic sugar production;  
(b) the current domestic market price of sugar; and  
(c) the domestic price level that should be a ttained before imports of sugar are allowed 
to occur, and the quantity of sugar imports that should be allowed based on (a) and 
(b).   
 
• If so, what is the current quantity of sugar that  Indonesia intends to allow to be imported 
based on the implementation of this regul ation and over what period?  Where is this 
information, including the dates when importation may occur, published?  
 
• What other factors may be cons idered in the coordination meeti ngs to determine if domestic 
production and supply are “sufficient to m eet requirement.”  What is the requirement 
referred to in the regulation?  
 
• What is the justification for limiting the time fr ame during which imports of sugar may occur, 
as spelled out in Article 7. 2 and Article 7.3 of Regulation No. 19/M-DAG/PER/2008?  Please 
give the approximate dates of the “people s ugar cane grinding season” referenced in 
Article 7, sub-article 2(a) and su b-article 3, e.g., in 2008 and 2009.  
 
• What is the justification for the price threshol d established in Article 7.2 of Regulation No. 
19/M-DAG/PER/2008?  How is the price “at fa rmers’ level” calcul ated or otherwise 
determined?  
 
Answer:  
 
• Co-ordination meetings  referred to in Article 7 are conve ned by the Indonesian Sugar Council 
(Dewan Gula Indonesia) chaired by the Minister of Agriculture.  Stakeholders in the Industry 
including Indonesia refiners, consumers and th eir representatives are Members of the Council. 
 
• This co-ordination process allows for inter alia  exchange of views on projected quantities of 
domestic supply, current domestic prices and pr ojected price threshold.  The Council may 
submit recommendation to the Minister of Trade to be taken into account in the final decision. 
 
• The quantity of sugar Indonesia intends to impor t in 2009 is 2,050 million tons.  There is no 
publication on this information but it is shared with the stakeholders. 
 
• Other factors that are taken into account are specifications and grades of sugar that are 
produced locally and imported, and the use and demand for the types of sugar concerned. 
 
• Imports of refined sugar is not limited to the time-frame.  However, imports of white sugar 
are not allowed one month before, during, a nd two months after the milling season.  This 
time-frame allows the Government to establis h projected output of white sugar produced 
domestically. 
 
• The price threshold established is  intended to provide a livelihood for farmers.  It is based on 
the cost incurred by the farmers for cultivating,  harvesting and the basic processing of sugar. 
__________