REGULATION OF THE MINISTER OF TRADE OF THE REPUBLIC OF INDONESIA
No. 05/M-DAG/PER/1/2007

CONCERNING
PROVISION ON THE EXPORT OF PRECURSORS

THE MINISTER OF TRADE OF REPUBLIC OF INDONESIA,

Attachment

Considering:

• a. That beside having benefit in the pharmacy and non-pharmacy fields, precursors also can be misused as raw material/ auxiliary material of narcotics and psychotropic illicitly;
• b. That in the framework of the involvement of Indonesia in combating illicit trade of international narcotics and psychotropic, it is necessary to regulate the export of precursors;
• c. That based on the considerations as intendedintended in letters a and b, it is necessary to stipulate a regulation of the Minister of Trade;

In view of:

• 1. Trade ordinance of 1934 (statute book of 1938 No. 86) as has already been amended and supplemented;
• 2. Law No. 5/1984 on industry (statute book of 1984 No. 22, supplement to statute book No. 3274);
• 3. Law No. 7/1994 on ratification of Agreement Establishing The world Trade Organization (Statute Book of 1994 No. 57, supplement to statute book No. 3564);
• 4. Law No. 10/1995 on customs affairs (statute book of 1995 No. 75, supplement to statute book No. 3612) as has already been amended by law No. 17/2006 (statute book of 2006 No. 93, supplement to statute book No. 4661);
• 5. Law No. 8/1996 on ratification of Convention on Psycho tropics Substances 1971 (Psychotropic convention 1971) (statute book of 1996 No. 100, supplement to statute book No. 3657);
• 6. Law No. 5/1997 on Psychotropic (statute book of 1997 No. 10, supplement to statute book no 3671);
• 7. Law No. 7/1997 on ratification of the United Nations Convention Against Illicit Traffic in Narcotic drugs and Psychotropic Substances 1988 (statute book of 1997 No. 17, supplement to statute book No. 3673);
• 8. Law No. 22/1997 on Narcotics (statute book of 1997 No. 67, supplement to statute book No. 3698);
• 9. Presidential Decree No. 187/M/2004 on the Establishment of the United Indonesia Cabinet as already amended several times and the latest by presidential Decree No. 171/M/2005;
• 10. Presidential regulation No. 9/2005 on status, tasks, functions, organizational structures and working arrangements of state ministries as has already been amended by presidential regulation No. 90/2006;
• 11. Presidential regulation No. 10/2005 on first-echelon organizational units and tasks of state ministries as has already been amended several times and the latest by presidential regulation No. 917/MENKES/SK/VIII/1997 on kinds of Psycho tropics Precursors;
• 12. Decree of the Minister of Health No. 917/MENKES/SK/VIII/1997 on kinds psychotropic precursors;
• 13. Decree of the Minister of Health No. 890/MENKES/SK/VIII/1998 on Kinds of Narcotic Precursors;
• 14. Decree of the Minister of Industry and Trade No. 558/MPP/KEP/12/1998 on Export General Provisions as has already been amended several times and the latest by regulation of the Minister of Trade No. 07/M-DAG/PER/4/2005;
• 15. Regulation of the Minister of Trade No. 01/M-DAG/PER/3/2005 on Organization and Working Arrangement of the Ministry of Trade as has already been amended by regulation of the Minister of Trade No. 30/M-DAG/PER/12/2005;
• 16. Regulation of the Minister of Finance No. 103/PMK.04/2006 on the use of Customs Declaration of Single Administrative Document at Batam, Bintan, and karimun Islands;

HAS DECIDED:

To Stipulate:

THE REGULATION OF THE MINISTER OF TRADE ON PROVISION ON THE EXPORT OF PRECURSORS

Article 1

Referred to in this regulation as:

• 1. Precursors are proceeding substances or materials or certain chemical substances usable as raw materials/ auxiliary materials for the need of industrial production processes and misused in the production of narcotics and/or psychotropic.
• 2. Approved Exporters of Precursors, hereinafter called ET-Precursors are companies already securing recognition from the Minister of Trade in this case the Director General of Foreign Trade to export precursors.
• 3. Recommendation is a letter issued by the related institution/unit, which contains technical explanation and is not export permit/approval.
• 4. Pre-export notification, hereinafter called PEN is notification about export approval of precursors, which is conveyed to the authorized institution/ agency in export-destination countries.
• 5. Minister is the minister of trade.
• 6. "Dirjen Daglu" is the Director General of Foreign Trade in the Trade Ministry.
• 7. "Dirjen IAK" is the Director General of Agro and Chemical Industries of the Ministry of Trade.
• 8. Kabareskrim POLRI is the Head of the Crime Detective Board of the Indonesian Police.
• 9. Chairman of BNN is the Chairman of the national Narcotics Board established on the basis of Presidential Decree No. 17/2002.
• 10. Surveyors are survey companies securing authorization from and stipulated by the Minister of trade to verify or inquire technically the export of precursors

Article 2

(1) Kinds of the precursors as intended in article 1 point 1, which can be exported are as contained in Attachment I to this regulation.

(2) The precursors as intendedintended in paragraph (1) only can be exported by companies which had already secured recognition as ET-Precursor.

Article 3

(1) Recognition as ET-Precursors as intended in article 2 paragraph (2) is stipulated by Dirjen Daglu.

(2) In order to secure recognition as ET-Precursor as intended in paragraph (1), the companies must convey written application to Dirjen DAglu by enclosing the following documents:

• a. Industrial Business License (IUI) from technical ministries on the basis of legislation in force;
• b. copy of Corporate Registry Number (TDP);
• c. copy of Taxpayer Code Number (NPWP); and
• d. recommendation from Dirjen IAK.

(3) Based on the written application from the companies as intended in paragraph (2) , Dirjen Daglu issue approval or rejection of application for recognition as ET-Precursor in not later than 10 (ten) working days as from the date of receipt of application.

(4) The recognition as ET-Precursors as intended in Article 2 paragraph (2) is valid for 3 (three) years and can be extended.

(5) Model of the recognition as ET-Precursor as intended in paragraph (1) is as contained in Attachment II to this regulation.

Article 4

(1) the export of precursors must secure prior export-approval of precursors from Dirjen Daglu after considering recommendation from the Chairman of BNN and kabareskrim POLRI.

(2) In order to secure the export approval of precursors as intended in paragraph (1), IT-Precursor must submit written application to dirjen Daglu, accompanied by copy of import approval of precursors from the institution issuing import approval in export destination country as well as information from ET-Precursor on the quantity and kind, designation of precursors which will be exported as well as name and address of receiving company (importer) in the export destination country.

(3) the export approval as intended in paragraph (1) is maximally 180 (one hundred and eighty) days as from the date of issuance of export approval and cannot be extended.

Article 5

(1) in order to enable ET-Precursor to realize the export approval as intended in article 4, ET-Precursor must notify every shipment to BNN, covering loading port, departing date of ship as well as export destination port and country.

(2) based on the notification about the shipment plan as intended in paragraph (1) , BNN is obliged to convey PEN as intended in Article 1 point 4 to the authorized agency/ institution in the export destination country.

(3) in connection with the conveyance of PEN as intended in paragraph (2) , the authorized institution/ agency in the export destination country conveys confirmation in not later than 5 (five) working days as from the date of conveyance of PEN.

(4) in the case of the authorized institution / agency in the export destination country as intended in paragraph (2) does not provide theconfirmation in 5 (five) working days, the export destination country is deemed acceptable to the export destination country is deemed acceptable to the export of precursors.

(5) BNN is obliged to convey confirmation of PEN as intended in paragraphs (3) and (4) to ET-Precursors with a copy made available to the related institution in not later than 3 (two) working days as from the date of receipt of PEN confirmation of after the authorized institution/ agency in the export destination country does not give confirmation in 5 (five) working days.

(6) ET-Precursor can realize the shipment of the export as intended in paragraph (1) after BNN conveys PEN confirmation as intended in paragraph (5).

(7) if necessary, BNN can issue technical regulation of procedures for issuing PEN by referring to this regulation.

Article 6

The export of precursors realized by ET-Precursor as intended in Article 2 paragraphs (2) must be subjected verification or technical inquiry first.

Article 7

(1) The verification or technical inquiry as intended in Article 6 is done by the surveyors stipulated by the Minister.

(2) The surveyors as intended in paragraph (1), which can be stipulated as executors of verification or technical inquiry must meet the following requirements:

• a. having experience as surveyor for 5 (five) years at the minimum;
• b. having branch or broad service network in the Indonesian territory.

(3) The verification or technical inquiry as intended in Article 4 covers analysis and examination of data or information minimally regarding:

• a. export destination country;
• b. classification and HS No;
• c. kind and technical specification;
• d. chemical composition of precursors; and
• e. quantity of precursors, which will be exported.

(4) Results of the verification or technical inquiry by the surveyors as intended in paragraph (1) are issued in the form of surveyor report (LS) to be used as customs supplementary document required for registration of export Declaration (PEB) or Customs declaration of single administrative document (PPSAD) in the case of customs and excise service offices already applying it.

(5) In connection with the realization of verification or technical inquiry of the export of precursors, surveyors collect compensation for the rendered service from ET-Tin with the amount stipulated by observing the benefit principles.

(6) Costs spent for verification or technical inquiry of the export of precursors by surveyors are borne by exporters.

Article 8

(1) The surveyors as intended in article 7 paragraph (1) are obliged to convey the following documents to dirjen Daglu:

• a. written report on all activities related to verification or technical inquiry which is realized, every month ;
• b. original copy of every surveyor report, which is issued, in not later than 3 (three) working days as from the date of issuance of the surveyor report.

(2) surveyors must be able to ascertain that the exported goods are in accordance with the surveyor report (LS) as intended in Article 7 paragraph (4).

Article 9

(1) Companies which had already secured recognition as ET-Precursors are obliged to convey report on the realization of export in writing to dirjen Daglu, in this case the director of Export of Industrial and Mining Products in the ministry of trade, with a copy made available to the chairman of BNN, kabreskrim POLRI, dirjen IAK of the Industry Ministry and Head of BPOM every 3 (three) months, starting from the date of issuance of recognition as ET-Precursor.

(2) The report on the realization of the export as intended in paragraph (1) is conveyed in the case of the export of precursors being realized or not.

(3) Model of the report on the realization of the export as intended in paragraph (1) is as contained in attachment III to this regulation.

Article 10

In the case of the export of products other than those mentioned in attachment I to this regulation (except medicines) containing precursors and required by the export destination country for securing export approval, the provisions in this regulation must be fulfilled.

Article 11

(1) Recognition as ET-Precursor in the case of the companies and/or executives/executive directors of the companies not reporting the realization of the export as intended in Article 10 paragraph (9) twice in one year.

(2) recognition as ET-Precursor already recognized can be re-activated in the case of the companies and/or executives/executive directors of the companies already fulfilling the obligation as intended in paragraph (1).

(3) Recognition as ET-Precursor is revoked in the case of the companies and/or executives/executive directors of the companies:

• a. exporting precursors with the kind or quantity not suitable to the export approval;
• b. being proven to convey untrue information or data upon submitting application for recognition as ET-Precursor;
• c. being in the course of investigation into the alleged crime related to misuse of recognition as ET-Precursor and/or export approval of precursors;
• d. exporting precursors by using export approval already expiring;
• e. being declared guilty by the court for the violation and crime related to the misuse of recognition as ET-Precursor on the basis of a legally fixed court decision.

(4) The freezing, re-activation and revocation of recognition as ET-Precursors as intended in paragraphs (1), (2), and (3) are done by dirjen daglu.

Article 12

Stipulation as verifier is revoked in the case of:

• a. not implementing the obligation as intended in Article 8 paragraph (1) as many as twice in a period of one year ; and/or
• b. not implementing the obligation as intended in Article 8 paragraph (2).

Article 13

The exception from the provision in the regulation only can be stipulated by the minister.

Article 14

The regulation comes into force as from February 23, 2007.

For public cognizance, the regulation shall be published in state gazette of the Republic of Indonesia.

Stipulated in Jakarta
On January 22, 2007
THE MINISTER OF TRADE
Signed
MARI ELKA PANGESTU

Attachment to REGULATION OF THE MINISTER OF TRADE OF THE REPUBLIC OF INDONESIA
No. 05/M-DAG/PER/1/2007