REGULATION OF MINISTER OF TRADE
No. 10/M-DAG/PER/6/2005

ON
RULES ON EXPORT AND IMPORT OF ROUGH DIAMONDS

THE MINISTER OF TRADE,

Considering :

• a. that, in the framework of the enforcement of the United Nations Resolution No. 55/56 dated December 1, 2002 on prevention of violations of trade of diamonds related to armed conflicts, since January 1, 2003, the mechanism of export and import of rough diamonds in the form of scheme of certification of diamonds through Kimberley Process Certification Scheme (KPCS), had been agreed;
• b. that, in the framework of supporting of Indonesian economic interest, especially relating to the development and enhancement of national diamond trade, Indonesia's participation in the KPCS and with the enforcement of the regulations of export and import of rough diamonds are deemed necessary;
• c. that, considering the matters of paragraphs a and b, it is necessary to have rules on export and import of rough diamonds as stipulated in the Regulation of the Minister of Trade.

In view of :

• 1. Bedriefsreglementerings Ordonantie of 1934 (Statute Book of 1938 No. 85);
• 2. Law No. 11/1967 on Rules on Mining Affairs (Statute Book of 1967 No. 22, Supplement to Statute Book No. 2831);
• 3. Law No. 10/1995 on Customs Affairs (Statute Book of 1995 No. 75, Supplement to Statute Book No. 3612);
• 4. Presidential Decree No. 260/1967 on Confirmation of Duties and Responsibilities of the Minister of Trade in Foreign Trade Affairs;
• 5. Presidential Decree No. 187/M/2004 on Establishment of United Indonesia Cabinet as already amended by Presidential Decree No. 8/M/2005;
• 6. Presidential Regulation No. 9/2005 on Positions, Duties, Functions, Organizational Structures, and Work Procedures of the State Ministries;
• 7. Presidential Regulation No. 10/2005 on Units of Organizations and Duties of Echelons I of the State Ministries as already amended by Presidential Regulation No. 15/2005;
• 8. Decree of the Minister of Industry and Trade No. 229/MPP/Kep/7/1997 on General Rules on Import Affairs;
• 9. Decree of the Minister of Industry and Trade No. 230/MPP/Kep/7/1997 on Commodities Which Import Procedure Are Regulated as already amended several times and latest by Decree of the Minister of Industry and Trade No. 789/MPP/Kep/12/2002;
• 10. Decree of the Minister of Industry and Trade No. 558/MPP/Kep/12/1998 on General Rules on Export Affairs as already amended several times and latest by Regulation of the Minister of Trade No. 07/M-DAG/PER/4/2005;
• 11. Decree of the Minister of Industry and Trade No. 40/MPP/Kep/1/2003 on Importer Identification Number (API);
• 12. Regulation of the Minister of Trade No. 01/M-DAG/PER/3/2005 on Organization and Work Procedure of the Ministry of Trade;

DECIDES :

To stipulate :

REGULATION OF THE MINISTER OF TRADE ON RULES ON EXPORT AND IMPORT OF ROUGH DIAMONDS.

Chapter I
General Provisions

Article 1

Hereinafter referred to as:

• 1. Rough Diamond is diamond included in Harmonized Tariff Schedule (HS) as contained in the Indonesian Book of Tariff of Import Duty of 2004, as follows :
• - 7102.10.00.00 - unsorted
• - industries
  - 7102.21.00.00 - not processed or cut simply, split or broken
  - 7102.29.00.00 - others
• - non-industries
  - 7102.31.00.00 - not processed or cut simply, split or broken
  - 7102.39.00.00 - others
• 2. Registered Exporter of Rough Diamonds, which is hereinafter called ET-Diamond, is a company, which has been certified by the Minister of Trade c.q. the Director General of Foreign Trade of the Department of Trade, to operate export of rough diamonds.
• 3. Registered Importer of Rough Diamonds, which is hereinafter called IT-Diamond, is a company, which has been certified by the Minister of Trade c.q. the Director General of Foreign Trade of the Department of Trade, to operate import of rough diamonds.
• 4. Kimberley Process Certification Scheme, which is hereinafter called KPCS, is an international scheme of certification of trade of rough diamonds as agreed by KPCS Members to be enforced as rules on trade of rough diamonds among KPCS Members.
• 5. KPCS Member is a country or international organization participating in KPCS and applying KPCS rules effectively among them.
• 6. Rough Diamond Certificate is a certificate issued by KPCS Member as a complementary document of shipment in the framework of export and import of rough diamonds in accordance with KPCS rules.
• 7. Surveyor is an accredited survey organization/company, which has been authorized and designated by the Minister of Trade to perform evaluation and inspection into export and import of rough diamonds and to issue Rough Diamond Certificate.
• 8. Director General of Foreign Trade of the Department of Trade, which is hereinafter called DIRJEN DAGLU, is an officer authorized to perform administrative and technical activities on behalf of the Minister of Trade in the framework of enforcement of this Regulation and for and on behalf of the Minister of Trade to act as liaison officer of the Indonesian government in the KPCS organization.
• 9. Minister is the Minister of Trade.

Article 2

(1) Export and import of rough diamonds may only be operated by companies, which have been certified as ET-Diamond and IT-Diamond by the Department of Trade.

(2) The export and import of rough diamonds by ET-Diamond and IT-Diamond, as set forth in paragraph (1), may only be operated to and from KPCS Members.

Chapter II
Rules on Export of Rough Diamonds

Article 3

Rough diamonds can be exported in compliance with the following conditions:

• a. Shipment may only be addressed to KPCS Members;
• b. Every shipment must be accompanied with Rough Diamond Certificate issued by the Surveyor, as set forth in Article 1 paragraph 7;
• c. Rough Diamonds shall be wrapped and packed in tamper-resistant containers and given sufficient protection;
• d. Rough Diamond Certificate shall be attached and shall not be separated from the containers; and
• e. Rough diamonds must originate from sources of mines of rough diamonds legally evidenced by the licenses from the authorities of mining affairs or other evidences in accordance with the applicable laws.

Article 4

(1) Rough diamonds may only be exported by companies, which have been certified as ET-Diamond by the Department of Trade.

(2) To be certified as ET-Diamond, as set forth in paragraph (1), the companies must file applications, in writing, to DIRJEN DAGLU through the Director of Export of Industrial and Mining Products of the Department of Trade completed with:

• a. Copy of Trading Business License (SIUP) or mining business license from the institutions of mining affairs or other similar business licenses issued by the authorized institutions;
• b. Copy of Company Registration Certificate (TDP);
• c. Copy of Taxpayer Identification Number (NPWP);
• d. Recommendation from the Director General of Mineral, Coal, and Geothermal of the Department of Energy and Mineral Resources on support of worthiness of export of rough diamonds.

(3) Based on the written applications, as set forth in paragraph (2), not later than 10 (ten) working days since receipt of the applications, DIRJEN DAGLU shall issue Certificate of ET-Diamond if the applications have already been qualified or shall issue letter of rejection of certification of ET-Diamond and the reasons if the applications are not qualified.

(4) The Certificate of ET-Diamond shall be valid for 3 (three) years and can be extended.

Article 5

(1) The exploitation of rough diamonds must first obtain Certificate of Approval of Export (SPE) of Rough Diamonds from DIRJEN DAGLU c.q. the Director of Export of Industrial and Mining Products of the Department of Trade.

(2) To obtain SPE of Rough Diamonds, as set forth in paragraph (i), ET-Diamond must file applications, in writing, to DIRJEN DAGLU c.q. the Director of Export of Industrial and Mining Products of the Department of Trade completed with certificate of company profile, quantity and size and specifications of Rough Diamonds that will be exported, port of loading, export schedule, destination country, and name and address of importer in the destination country by submitting copy of Certificate of ET-Diamond and copy of certificate of sources of mines of rough diamonds, as set forth in Article 3 paragraph e.

Article 6

(1) ET-Diamond, which has obtained SPE of Rough Diamonds, as set forth in Article 5, must submit carbon copy of SPE of Rough Diamonds and other relevant documents required in the framework of export of rough diamonds to the surveyor, which has been certified by the Minister.

(2) Based on the SPE of Rough Diamonds, the surveyor shall perform evaluation and inspection into the rough diamonds to further issue Rough Diamond Certificate.

Article 7

(1) ET-Diamond must submit result of inspection and original copy of the Rough Diamond Certificate issued by the surveyor, SPE of Rough Diamonds, and other relevant documents required in the framework of export of rough diamonds to the local Customs and Excise Service Office at the port of loading for export of rough diamonds to be further customs cleared before being exported.

(2) The authorized officer of the Customs and Excise Service Office, as set forth in paragraph (i), shall give approval of export of rough diamonds after ensuring that the data/ information inspected has been in accordance with that contained on SPE of Rough Diamonds and Rough Diamond Certificate.

Article 8

(1) The issuance of Rough Diamond Certificate must be based on the data/ information obtained from result of inspection of the relevant documents and physical inspection into rough diamonds that have been exported.

(2) The Rough Diamond Certificate must be printed on paper, which is safe from forgery, and shall be written in 2 (two) languages, namely Indonesian and English languages, and shall contain data/information on at least the following:

• a. Heading of the Certificate reading: "Kimberley Process Certificate";
• b. Number of Certificate;
• c. Name and address of exporter;
• d. Name and address of importer;
• e. Country of origin with alpha code 2 (ISO 3166-1);
• f. Destination country with alpha code 2 (ISO 31661);
• g. HS Number;
• h. Carats of the rough diamonds;
• i. Value of the rough diamonds in United States Dollars (USD);
• j. Number of parcels of rough diamonds;
• k. Date of issuance and date of expiration of Certificate;
• l. Statement reading: "The shipment of these rough diamonds has been in accordance with the rules of Kimberley certification process for handling of rough diamonds"; and
• m. Name and address of the surveyor as an organization authorized by the Minister to issue the Certificate, as set forth in Article 1 paragraph 7 and signature of the authorized officer of the surveyor.

(3) Format of the Rough Diamond Certificate is as specified in the Appendix to this Regulation.

Article 9

In case that the exported rough diamonds are re-exportable, the re-export of the rough diamonds must be in accordance with the following terms and conditions:

• a. Re-export shall be done by IT-Diamond who imports the rough diamonds to Indonesia or by another company, which has been certified as ET-Diamond;
• b. The re-export must obtain export approval from DIRJEN DAGLU through written applications submitted by IT-Diamond or another company, as set forth in paragraph a, completed with the relevant documents and Rough Diamond Certificate from the issuing organization/institution in the country of KPCS Member submitted when the Rough Diamonds were imported to Indonesia;
• c. Re-export shall only be addressed to KPCS Members;
• d. Rough diamonds, which will be re-exported, must be inspected by the surveyor without issuing Rough Diamond Certificate, but is sufficient just to give a label indicating completion of re-inspection of Rough Diamond Certificate issued by organization/institution in the country of the KPCS Member that must be attached when the rough diamonds were imported to Indonesia;
• e. Approval for re-export of rough diamonds may only be given after the authorized officer of the Customs and Excise Service Office at the place of export has performed customs clearance and has been ensured that the data/information on re-export of the rough diamonds is true and re-export shall be addressed to other KPCS Members.

Article 10

The surveyor may collect fee for customs clearance and issuance of Rough Diamond Certificate by the rough diamond exporting countries, which amount will be decided based on agreement of both parties.

Chapter III
Rules on Import of Rough Diamonds

Article 11

Rough diamonds may be imported to Indonesia in compliance with the following conditions:

• a. Every shipment must be completed with Rough Diamond Certificate issued by the authorized organization/institution in the country of KPCS Member;
• b. Rough Diamonds shall be wrapped and packed in tamper-resistant containers and given sufficient protection by the authorized organization/institution in the KPCS member country;
• c. Rough Diamond Certificate of the KPCS Member shall be attached to the rough diamond containers and shall clearly indicate that the Rough Diamond Certificate is issued for shipment in the framework of import of rough diamonds to Indonesia.

Article 12

(1) Rough diamonds may only be imported by companies, which have been certified as IT-Diamond by the Department of Trade.

(2) To be certified as IT-Diamond, as set forth in paragraph (1), the companies must file applications, in writing, to DIRJEN DAGLU through the Director of Import of the Department of Trade completed with:

• a. Copy of Trading Business License (SIUP) or Industrial Business License (IUI) or other similar business licenses issued by the authorized institutions;
• b. Copy of Company Registration Certificate (TDP);
• c. Copy of Taxpayer Identification Number (NPVVP);
• d. Copy of Importer Identification Number (API).

(3) Based on the written applications from the companies, as set forth in paragraph (2), not later 10 (ten) working days from receipt of the applications, DIRJEN DAGLU shall issue Certificate of IT-Diamond if the applications are qualified or shall issue Letter of Rejection and the reasons if the applications are unqualified.

(4) The Certificate of IT-Diamond shall be valid for 3 (three) years and can be extended.

Article 13

(1) Every import of rough diamonds must first obtain Certificate of Approval of Import (SPI) of Rough Diamonds from DIRJEN DAGLU c.q. the Director of Import of the Department of Trade.

(2) To obtain SPI of Rough Diamonds, as set forth in paragraph (1), IT-Diamond must file applications, in writing, to DIRJEN DAGLU c.q. the Director of Import of the Department of Trade completed with certificate of company profile, quantity and size and specifications of rough diamonds, which will be imported, port of destination/unloading, import schedule, country of origin, and name and address of exporter in the country of origin completed with copy of Certificate of IT-Diamond.

Article 14

(1) IT-Diamond, which has obtained SPI of Rough Diamonds, as set forth in Article 13, must submit carbon copy of SPI of Rough Diamonds or other relevant documents required in the framework of import of rough diamonds to the surveyor as designated by the Minister.

(2) Based on the SPI of Rough Diamonds, the surveyor shall perform physical inspection into the rough diamonds and inspect compliance of the Rough Diamond Certificate issued by the organization/institution authorized in the country of KPCS Member in accordance with KPC Rules.

(3) The physical inspection into the rough diamonds and the inspection into Rough Diamond Certificate issued by the organization/ institution authorized in the country of KPCS Member, as set forth in paragraph (2), shall be performed by the surveyor in the port of destination/unloading in Indonesia.

Article 15

(1) IT-Diamond must submit result of inspection fron-, the surveyor and SPI of Rough Diamonds and other relevant documents required in the framework of import of rough diamonds to the local Customs and Excise Service Office at the port of destination/unloading to be customs cleared prior to export of rough diamonds to other Indonesian customs areas.

(2) The authorized officer of the Customs and Excise Service Office, as set forth in paragraph (1), shall give approval of import of rough diamonds to other Indonesian customs areas after being ensured of the honesty of the inspected data/information in accordance with that contained on the SPI of Rough Diamonds.

Article 16

On rough diamonds from abroad introduced to Indonesia, which will be further shipped to another destination country, without first being introduced into the other Indonesian customs areas, shall be exempted from the provisions of this Regulation.

Article 17

The surveyor may collect fee for the evaluation and inspection into rough diamonds from the importers, which amount shall be decided based on the agreement of both parties.

Chapter IV
Reporting of Export and Import of Rough Diamonds

Article 18

(1) Companies, which have been certified as ET-Diamond and IT-Diamond by the Department of Trade, must submit reports, in writing, to DIRJEN DAGLU, with a carbon copy furnished to the Director General of Mineral, Coal, and Geothermal of the Department of Energy and Mineral Resources regarding any activities performed in relation to export and import of rough diamonds once in every 6 (six) months.

(2) FT-Diamond and IT-Diamond, which have obtained SPE and SPI of Rough Diamonds, must submit reports on realizations of export and import of rough diamonds to DIRJEN DAGLU with a carbon copy furnished to the Director of Export of Industrial and Mining Products of the Department of Trade and the Director of Import of the Department of Trade within not later than 14 (fourteen) working days from date of realizations of export and import.

Article 19

The surveyor, as set forth in Article 1 paragraph 7, must submit reports, in writing, regarding any activities relating to the performance of evaluation and inspection of export and import of rough diamonds and issuance of Rough Diamond Certificate once a month to DIRJEN DAGLU and must submit original copy of every Rough Diamond Certificate issued to DIRJEN DAGLU within not later than 3 (three) working days from date of issuance of Rough Diamond Certificate.

Chapter V
Sanctions

Article 20

(1) The Minister through DIRJEN DAGLU may impose sanctions in the form of:

• a. Freeze of Certificate of ET-Diamond or IT-Diamond for every violation against the reporting obligation, as set forth in Article 18, committed by ET-Diamond or IT-Diamond up to 1 (one) month after the occurrence of the violation;
• b. Revocation of Certificate of ET-Diamond or IT-Diamond if the time, as set forth in clause a. is exceeded or if there are strong evidences of occurrence of violations against the provisions other than Article 18 of this Regulation by ET-Diamond or IT-Diamond.

(2) The freeze of Certificate of ET-Diamond or IT-Diamond, as set forth in paragraph (1) clause a, shall be cancelled by the Minister through DIRJEN DAGLU if ET-Diamond or IT-Diamond has fulfilled the obligation as set forth in Article 18 before the period of 1 (one) month of freezing of the Certificate of ET-Diamond or IT-Diamond.

Article 21

The Minister through DIRJEN DAGLU may cancel the recognition of surveyor if the surveyor is proven violating the provisions of this Regulation and recognize other survey organization/company to become surveyor with regard to the enforcement of this Regulation.

Article 22

(1) Persons or companies operating export and import of rough diamonds not in accordance with the provisions of this Regulation, shall be declared as having committed violations.

(2) The violations, as set forth in paragraph (1), shall be imposed with penalties in accordance with the applicable regulations.

Chapter VI
Supervision

Article 23

(1) DIRJEN DAGLU shall perform supervision over all activities of export and import of rough diamonds and the enforcement of this Regulation.

(2) In performing supervision, as set forth in paragraph (1), DIRJEN DAGLU shall coordinate with the Director General of Mineral, Coal, and Geothermal of the Department of Energy and Mineral Resources and other relevant institutions.

(3) Result of supervision by DIRJEN DAGLU, as set forth in paragraphs (i) and (2), shall be reported to the Minister to be compiled as materials for report of the Indonesian government to KPCS organization in accordance with KPCS rules.

Chapter VII
Other Provisions

Article 24

(1) Technical rules and enforcement of this Regulation shall be stipulated by DIRJEN DAGLU.

(2) Exceptions from the provisions of this Regulation shall be the authority of and shall be stipulated by the Minister of Trade or the appointed officer.

Chapter VIII
Closing

Article 25

This Regulation starts to be enforceable from the date it is stipulated.

For public cognizance, this Regulation shall be published by placing it in the State Gazette of the Republic of Indonesia.

Stipulated in Jakarta
On June 10, 2005
THE MINISTER OF TRADE OF THE REPUBLIC OF INDONESIA,
sgd
MARI ELKA PANGESTU