REGULATION OF THE MINISTER OF FINANCE
No. 615/PMK.04/2004

ON
PROVISIONAL IMPORT PROCEDURES

THE MINISTER OF FINANCE,

Considering :

• a. in the framework of better guaranteeing legal certainty and justice, it is deemed necessary to re-regulate provisional import procedures as regulated in Decree of the Minister of Finance No. 574/KMK.05/1996 on provisional. import procedures as already amended by Decree of the Minister of Finance No. 475/KMK.01/1998;
• b. that based on the consideration as meant in letter a, a regulation of the Minister of Finance on provisional import procedures needs to be stipulated;

In view of :

• 1. Law No. 6/1983 on taxation general provisions and procedures (Statute Book of 1983 No. 49, Supplement to Statute Book No. 3262) as already amended several times and the latest h Law No. 16/2000 (Statute Book of 2000 No. 126, Supplement to Statute Book No. 3984);
• 2. Law No. 7/1983 on income tax (Statute Book of 1983 No. 50, Supplement to Statute Book No. 3263) as already amended several times and the latest by Law No. 17/2000 (Statute Book of 2000 No. 127, Supplement to Statute Book No. 3985);
• 3. Law No. 8/1983 on value added tax on goods and services and sales tax on luxury goods (Statute Book of 1983 No. 51, Supplement to Statute Book No. 3264) as already amended several times and the latest by Law No. 2000 (Statute Book of 2000 No. 128, Supplement to Statute Book No. 3986);
• 4. Law No. 10/1995 on customs affairs (Statute Book of 1995 No. 75, Supplement to Statute Book No. 3612);
• 5. Presidential Decree No. 187/M/2004;
• 6. Decree of the Minister of Finance No. 491/KMK.05/1996 on the basis for calculation of import duty on import goods;
• 7. Decree of the Minister of Finance No. 231/KMK.03/2001 on treatment of value added tax and sales tax on luxury goods on the import of taxable goods exempted from import duty;
• 8. Decree of the Minister of Finance No. 254/KMK.03/ 2001 on the appointment of collectors of income tax article 22, kind and amount of levies as well as procedures for remittance and reporting as already amended by Decree of the Minister of Finance No. 392/KMK.03/ 2001;

DECIDES:

To stipulate :

THE REGULATION OF THE MINISTER OF FINANCE ON PROVISIONAL IMPORT PROCEDURES

Article 1

Referred to in this regulation as:

• 1. Provisional Import shall be the import of goods into Customs Area, which solely will be re-exported in a specified period.
• 2. Re-exported shall be the re-shipment of provisionally imported goods to outside Customs Area.
• 3. Release shall be the release of goods from Customs Area or Bonded Collection Place to free distribution with the approval of customs and excise official.
• 4. Exemption from import duty shall be abolition of the payment of the required import duty as meant in Law No. 10/1995 on customs affairs.
• 5. Import Duty Relief shall be reduction of part of payment of the required import duty as meant in Law No. 10/1995 on customs affairs.
• 6. Director General shall be the Director General of Customs and Excise.
• 7. Head of Office shall be the Head of Customs and Excise Service Office where customs liabilities are fulfilled.

Article 2

The imported goods can be released as provisionally imported goods if the moment of the import meet the following requirements:

• a. they won't be used up in the import period;
• b. their form does not change principally during the import period, unless otherwise being worn-out in the use;
• c. their identities are clear; and
• d. there is supporting document that the goods will be re-exported.

Article 3

The provisional import license shall be issued by the Director General or the appointed customs and excise officials.

Article 4

(1) The goods as meant in Article 2 can be given the exemption or relief of import duty.

(2) The goods eligible to the exemption from the import duty shall be:

• a. goods for the purpose of exhibition, which are displayed in place other than Entrepot for Exhibition Purpose;
• b. goods for the need of seminar or similar activity;
• c. goods for the need of demonstration;
• d. goods for the need of experts;
• e. goods for the need of research, education, science and culture;
• f. personal goods for the need of tourists;
• g. goods imported for the need of sport as well as contest;
• h. packages used for the transport of imported or exported goods repeatedly;
• i. goods for the need of sample or model;
• j. mould;
• k. vehicle or transport mean used directly by international tourists;
• l. vehicle or transport mean coming through cross border and the use is not regular;
• m. goods for repairing, reconditioning, modifying;
• n. live animals for the need of public show, sport, contest, training and overcoming security disturbance;
• o. special equipment used for overcoming natural disaster, fire and security disturbance;
• p. goods for the need of domestic sea and air transport.

(3) The goods eligible to import duty relief shall be machines and equipment for working projects to be further stipulated by the Director General.

Article 5

(1) For the provisionally imported goods exempted from import duty as meant in Article 4 paragraph (2), importer shall give up guarantee to the head of office.

(2) The amount of guarantee which must be given up by importers to the head of office shall be amounting to the import duty and tax in the framework of import, which should be imposed on the imported goods.

Article 6

(1) For the provisionally imported goods given relief, importers shall pay import duty and value added tax as well as sales tax on luxury goods before the approval of release of goods is granted, unless otherwise exempted on the basis of the taxation provisions in force.

(2) The amount of import duty, which must be paid as meant in paragraph (1) shall be 2% (two percent) for every month or part of month of the period of the provisional import license, multiplied by the amount of import duty, which should be imposed on the provisional imported goods.

(3) The amount of value added tax and sales tax on luxury goods, which should be paid as meant in paragraph (1) shall be amounting to 100% (one hundred percent) of the total value added tax and sales tax on luxury goods, which should be imposed on the provisionally imported goods.

(4) In addition to the payment liabilities to import duty, value added tax and sales tax on luxury goods, importers shall give up guarantee amounting to the difference between the import duty which should be paid and import duty already paid plus Income Tax-article 22.

Article 7

(1) In order to fulfill customs liabilities to the provisional import, Import Declaration made on the basis of complementary customs documents and provisional import license shall be submitted.

(2) The import of goods shall be realized not later than 3 (three) months as from the date of provisional import license, accompanied by receipt of payment and/or guarantee.

(3) Unless the import declaration is submitted in the period as meant in paragraph (2), the provisional import license already issued shall be declared null and void.

Article 8

The provisional imported goods as meant in Article 4 paragraph (3) in non-new condition and/or goods having their import controlled shall secure import approval from the authorized institution.

Article 9

Upon granting the provisional import license, the Director General of the appointed customs and excise official shall examine and stipulate the customs value as well as classifications of goods for the provisionally imported goods as the basis for calculation of import duty and tax in the framework of import.

Article 10

The provisionally imported goods already given license to release shall be under customs supervision until the settlement.

Article 11

(1) The period of the provisional import license shall be maximally 12 (twelve) months as from the date of registration of import declaration and can be extended maximally twice for a maximum period of 12 (twelve) months respectively.

(2) The provisional import license shall be issued by Observing the purpose of the provisionally imported goods.

Article 12

As long as the provisional import license is effective, the provisionally imported goods can be relocated to other places after securing approval from the Director General of the appointed customs and excise officials.

Article 13

(1) Examination can be applied anytime to goods already securing the provisional import license to convince that the provisions in the provisional import license have been fulfilled.

(2) In the case of the examination as meant in paragraph (1) finding violation as meant in Article 26 paragraph (4) of Law No. 10/1995, the provisional import license shall be declared null and void and the importers shall be subjected to an administrative sanction in the form of a fine of 100% (one hundred percent) of the import duty yet to be paid.

(3) Importers shall settle customs liabilities to the provisionally imported goods as meant in paragraph (2) by means of re-exporting or settling the unpaid import duty and tax in the framework of import.

Article 14

(1) The provisionally imported goods shall be re-exported in the period stipulated in the provisional import license as meant in Article 3.

(2) In the case of the re-exported provision as meant in paragraph (1) being not fulfilled, import duty and tax in the framework of import yet to be paid in accordance with the Import Declaration shall be settled and the importers shall be subjected to administrative sanction in the form of a fine of 100% (one hundred percent) of the import duty yet to be paid.

(3) In certain cases in the form of serious damage because of force majeur or destruction because of force majeur, importers can be exempted from the obligation to re-export the provisionally imported goods as well as the obligation to settle the shortage of import duty and administrative sanction on the basis of consideration of the Director General.

Article 15

The guarantee shall be returned by the head of office in the case of:

• a. the relevant already re-exporting the provisionally imported goods;
• b. import duty, tax in the framework of import and administrative sanction in the form of fine being already settled; or
• c. the relevant already giving up the decision on exemption from import duty and tax in the framework of import as meant in Article 14 paragraph (3) on the provisionally imported goods facing serious damage because of force majeur or destroying because of force majeur.

Article 16

With the enforcement of this regulation, provisional import licenses having their import declaration already registered before the enforcement of this regulation shall remain effective until the provisional import licenses expire and if necessary, they can be extended with the requirements and provisions as regulated in this regulation.

Article 17

Provisions needed in the framework of the implementation of this regulation shall be further regulated by a regulation of the Director General.

Article 18

With the enforcement of this regulation, Decree of the Minister of Finance No. 574/KMK.05/1996 on provisional import procedures as already amended by Decree of the Minister of Finance No. 475/KMK.01/ 1998 shall be declared null and void.

Article 19

The regulation shall come into force as from January 1, 2005.

For public cognizance, the regulation shall be announced by placing it in State Gazette of the Republic of Indonesia.

Stipulated in Jakarta
On December 30, 2004

THE MINISTER OF FINANCE ,
sgd
YUSUF ANWAR