INDONESIA – IMPORTATION OF HORTICULTURAL PRODUCTS, ANIMALS AND ANIMAL PRODUCTS REQUEST FOR CONSULTATIONS BY THE UNITED STATES
Document: REQUEST FOR CONSULTATIONS BY
Date: 15 May 2014
Document codes: WT/DS478/1; G/L/1069; G/AG/GEN/119; G/LIC/D/48; G/PSI/D/4
Complainant: U.S.
Respondent: Indonesia
Third parties: Australia, Brazil, Canada, China, EU, India, Japan, Norway, Paraguay, Singapore, Taiwan, Argentina, South Korea, Thailand
Dispute stage: Appellate Body
Agreements cited: Art. XI:1  GATT 1994Art. 4.2  AgricultureArt. 3.2, 2.2(a)  Import LicensingArt. III:4  GATT 1994

INDONESIA – IMPORTATION OF HORTICULTURAL PRODUCTS,
ANIMALS AND ANIMAL PRODUCTS
REQUEST FOR CONSULTATIONS BY THE UNITED STATES
The following communication, dated 8 May 2014, from the delegation of the United States to the
delegation of Indonesia and to the Chairperson of the Dispute Settlement Body, is circulated in
accordance with Article 4.4 of the DSU.

My authorities have instructed me to request consultations with the Government of the Republic of
Indonesia ("Indonesia") pursuant to Articles 1 and 4 of the Understanding on Rules and Procedures
Governing the Settlement of Disputes , Article XXII of the General Agreement on Tariffs and Trade
1994 ("GATT 1994"), Article 19 of the Agreement on Agriculture ("Agriculture Agreement"),
Article 6 of the Agreement on Import Licensing Procedures ("Import Licensing Agreement"), and
Articles 7 and 8 of the Agreement on Preshipment Inspection concerning certain measures
imposed by Indonesia on the importation of horticultural products,
1 animals, and animal products2
into Indonesia.

As described below, Indonesia: (1) imposes prohibitions or restrictions on imports of horticultural
products, animals, and animal products; (2) imposes unjustified and trade-restrictive non-
automatic import licensing requirements on imports of such products; (3) accords less favorable
treatment to imported products than to like products of national origin; (4) has imposed
unreasonable and discriminatory preshipment inspection requirements; and (5) has failed to notify
and publish sufficient information concerning its import licensing measures.

With respect to horticultural products, Indonesia's non-automatic import licensing regime involves
at least three elements: (1) designation from the Ministry of Trade ("MOT") as a Producer
Importer ("PI") or Registered Importer ("RI") for Horticultural Products; (2) a horticultural product
Import Recommendation ("RIPH")
3 from the Ministry of Agriculture ("MOA"); and (3) an Import
Approval from the MOT. The PI/RI designation restricts the uses for which horticultural products
may be imported. RIPHs and Import Approvals are valid for one six-month period. 4 Applications
for these documents may only be submitted, and the documents issued, during two time periods in
the year. 5 Import Approvals specify, inter alia , the total quantity and country of origin of a
horticultural product that an importer may import during that period.

1 The relevant Indonesian measure defines horticulture as "all matters relating to fruits, vegetables,
plant medicinal materials, and floriculture" and horticultural products as "all products originating from fresh or
processed horticultural plant." Ministry of Trade (MOT) Regulation 16/2013, Articles 1(1) and 1(2) as amended
by MOT Regulation 47/2013.
2 The relevant Indonesian measures define animal products as "all materials originating from animal
that are fresh and/or processed for consumption, pharmaceutical, farming, and/or other purposes for fulfilling
the needs and welfare of human." MOT Regulation 46/2013, Article 1(5). The Indonesian measures at issue
also cover "carcasses, meats, edible offals, and/or their derivatives." Ministry of Agriculture (MOA) Regulation
84/2013.
3 Rekomendasi Impor Produk Hortikultura.
4 For chili and shallots, the Import Approval validity period is three months, see MOT Regulation
16/2013, as amended by MOT Regulation 47/2013, Article 14, and the RIPH validity period is not specified, see
MOA Regulation 86/2013, Article 13(4).
5 The time periods for applications vary for chili and shallots, see MOT Regulation 16/2013, as amended
by MOT Regulation 47/2013, Article 14B.
WT/DS478/1 • G/L/1069 • G/AG/GEN/119 • G/LIC/D/48 • G/PSI/D/4

With respect to animals and animal products, Indonesia's non-automatic import licensing regime
involves at least four elements: (1) satisfying the MOA requirements for importers; (2) a RI—
Animals and Animal Products designation from the MOT;
6 (3) a Recommendation 7 from the MOA;
and (4) an Import Approval from the MOT. Reco mmendations restrict the quantity, type, country
of origin, and intended use of the imported produc ts. They are valid for a specified period, up to
the end of the current year, and may only be applied for during four time periods throughout the
year.8 Import Approvals are valid for one three-month period, and applications may only be
submitted, and permits issued, during four time windows throughout the year. Import Approvals
specify, inter alia, the total quantity and country of origin of product the holder may import during
the specified period.

Indonesia's import licensing regime is not an automatic licensing regime, and it cannot be justified
as a non-automatic licensing regime implementing a WTO-consistent measure.

Indonesia's non-automatic import licensing regime prohibits and restricts imports in the following
ways:

• With respect to horticultural products, RIPH certificates do not permit the importation
of fresh horticultural products for consumption that were harvested more than six
months ago.

• With respect to animals and animal products, any animal products not listed in the
appendices to the import licensing regulations may not be imported at all.
9

• With respect to horticultural products, animals, and animal products, importers may
apply for Import Approvals only during specified time periods that can be months
ahead of the time of importation, and, once issued, an Import Approval restricts
imports during the specified time periods to set products, in set quantities, from set
countries, and under set conditions.

• Importers must predict in advance the quanti ty of product they will wish to import
during a given period, and apply accordingly for a specific amount, to be stated on
their Import Approval covering that three- or six-month period. Importers face
having their designation as a RI/PI suspen ded or revoked if the actual quantity
imported is less than a certain percentage of the stated quantity.

• The importation of horticultural products, animals, and animal products with respect
to certain types of intended use, sale, purchase, and/or distribution is prohibited or
restricted.

• The importation of horticultural products, animals, and animal products is prohibited
when domestic production is deemed sufficient to fulfill domestic demand.

• Imports of certain horticultural products, animals, and animal products are prohibited
or restricted when the prices of those products fall below certain reference prices,
which are set by a ministerial body (either the Price of Horticulture Product Monitoring
Team or the Beef Price Monitoring Team).
10

6 With respect to the animals and animal products listed in Appendix II, this requirement appears to
apply only to importers that are business operators and not to other categories of importers, such as social
institutions or State Owned Enterprises. See MOT Regulation 46/2013, Articles 4, 9, and 10; MOA Regulation
84/2013, Article 22.
7 Rekomendasi Persetujuan Pemasukan.
8 The timeframes appear to apply only to business operators and not to other types of importers. See
MOA Regulation 84/2013, Article 21.
9 This applies to all animals and animals products not listed in the appendices to MOA Regulation
84/2013 and MOT Regulation 46/2013.
10 These products include the animals and animal products listed in Appendix I of MOT Regulation
46/2013 and the horticultural products listed in Article 14B of MOT Regulation 16/2013, as amended by MOT
Regulation 47/2013.
WT/DS478/1 • G/L/1069 • G/AG/GEN/119 • G/LIC/D/48 • G/PSI/D/4

• For the above reasons, and due to the regime's complexity, Indonesia's import
licensing regime is a restriction on imports, is not as simple as possible, is more
administratively burdensome than absolutely necessary, unnecessarily requires
approaches to more than one administrative body, and is trade-restrictive.

In connection with its import licensing regime, Indonesia also has adopted measures limiting the
internal sale, offering for sale, purchase, distribution, or use of imported horticultural products,
animals, and animal products, in a manner that accords less favourable treatment than that
accorded to like domestic products. For example, Indonesia's measures limit the internal sale of
imported horticultural products to distributors, and limit the sale of imported beef to use in
industry and the hotel, restaurant, and catering sectors. Indonesia does not impose similar
limitations on like domestic products.

Indonesia's measures include preshipment inspection requirements. Indonesia has failed to
ensure that preshipment inspection activities do not result in unreasonable delays, are carried out
in a non-discriminatory manner, and are applied on an equal basis to all exporters.

Finally, the United States understands that Indonesia, with respect to its import licensing regime,
has failed to comply with notification obligations under Article 5 of the Import Licensing Agreement
and with publication requirements under Article 3 of the Import Licensing Agreement.

 The legal instruments through which Indonesia imposes and administers the above-
described measures include, but are not limited to, the following instruments:

• Law of the Republic of Indonesia Number 7 of Year 2014 Concerning Trade ("Trade
Law");

• Law of the Republic of Indonesia Number 13 of Year 2010 Concerning Horticulture
("Horticulture Law");

• Regulation of the Ministry of Agriculture Number 86/Permentan/OT.140/8/2013
Concerning Import Recommendation of Horticulture Products ("MOA Regulation
86/2013"), which repeals and replaces Regulation of the Minister of Agriculture
Number 47/Permentan/OT.140/4/2013 Concerning Recommendation on the
Importation of Horticulture Products ("MOA Regulation 47/2013"), which repealed and
replaced Regulation of the Mi nister of Agriculture Number
60/Permentan/OT.140/9/2012 ("MOA Regulation 60/2012");

• Regulation of the Minister of Trade Number 16/M-DAG/PER/4/2013 Concerning
Provisions on Horticulture Product Import ("MOT Regulation 16/2013"), which repeals
and replaces Regulation of the Minister of Trade Number 30/M-DAG/PER/5/2012
Concerning the Provisions on Import of Horticultural Products ("MOT Regulation
30/2012") and Regulation of the Minister of Trade Number 60/M-DAG/PER/9/2012
Regarding Second Amendment of Regulation of the Minister of Trade Number 30/M-
DAG/PER/5/2012 Regarding Provisions on Im port of Horticultural Products ("MOT
Regulation 60/2012");

• Regulation of the Ministry of Trade Number 47/M-DAG/PER/8/2013 Concerning
Amendment of Regulation of the Minister of Trade Number 16/M-DAG/PER/4/2013
Concerning Import Provision of Horticulture Product ("MOT Regulation 47/2013");

• Law of the Republic of Indonesia Number 18/2009 on Animal Husbandry and Animal
Health ("Animal Law");

• Regulation of the Ministry of Agri culture Number 84/Permentan/PD.410/8/2013
Concerning Importation of Carcass, Meat, Offal and/or Their Derivatives into the
Territory of the Republic of Indonesia (" MOA Regulation 84/2013"), which repeals and
replaces Regulation of the Minister of Agriculture Number
50/Permentan/OT.140/9/2011 Concerning Recommendation for Approval on Import of
Carcasses, Meats, Edible Offals and/or Processed Products Thereof to Indonesian
Territory ("MOA Regulation 50/2011") as amen ded by Regulation of the Minister of
Agriculture Number 63/Permentan/OT.140/5/2013 Concerning Amendment of
WT/DS478/1 • G/L/1069 • G/AG/GEN/119 • G/LIC/D/48 • G/PSI/D/4

Regulation of the Minister of Agriculture Number 50/Permentan/OT.140/9/2011
Concerning Import Approval Recommendation of Carcass, Meat, Offal, and/or their
Derivatives into the Territory of the Re public of Indonesia ("MOA Regulation
63/2013");

• Regulation of the Minister of Trade Number 46/M-DAG/PER/8/2013 Concerning Animal
and Animal Product Import and Export Pr ovision ("MOT Regulation 46/2013"), which
repeals and replaces Regulation of the Minister of Trade Number 22/M-
DAG/PER/5/2013 Concerning Import and Ex port of Animals and Animal Products
("MOT Regulation 22/2013"), which repealed and replaced Regulation of the Minister
of Trade Number 24/M-DAG/PER/9/2011 Conc erning Provisions on the Import and
Export of Animal and Animal Product ("MOT Regulation 24/2011");

• Law of the Republic of Indonesia Number 18/2012 Concerning Food ("Food Law"); and

• Law of the Republic of Indonesia Number 19/2013 Concerning Protection and
Empowerment of Farmers ("Farmers' Law"),

as well as any amendments, replacements, related measures, or implementing measures.

 Indonesia's measures appear to be inconsistent with Indonesia's obligations under the
following provisions of the covered agreements:

(i) Articles III:4, X:1, and XI:1 of the GATT 1994;

(ii) Article 4.2 of the Agriculture Agreement;

(iii) Articles 1.2, 1.5, 1.6, 2.2, 3.2, 3.3, 5.1, and 5.2 of the Import Licensing Agreement;
and

(iv) Articles 2.1 and 2.15 of the Ag reement on Preshipment Inspection.

We look forward to receiving your reply to the present request and to fixing a mutually convenient
date and location for consultations. In light of the request by New Zealand for consultations on
the same measures, dated May 8, 2014, we propose that consultations be held jointly with
New Zealand.