DECISION OF DIRECTOR GENERAL OF CUSTOMS AND EXCISE
NO. KEP-141/BC/2003

ON
TECHNICAL DIRECTIVES FOR EXEMPTION AND/OR RESTITUTION
OF IMPORT DUTY AND/OR EXCISE AS WELL AS UNCOLLECTED VALUE ADDED TAX AND
SALES TAX ON LUXURY GOODS ON
THE IMPORT OF GOODS AND/OR MATERIALS TO BE PROCESSED, ASSEMBLED OR INSTALLED TO
OTHER GOODS FOR THE PURPOSE OF EXPORT AND SUPERVISION

THE DIRECTOR GENERAL OF CUSTOMS AND EXCISE,

Attachment

Considering:

• a. that in bid to drive up the export of non-oil and gas commodities, it is deemed necessary to simplify procedures for exemption and/or restitution of import duty and/or excise as well as uncollected value added tax and sales tax on luxury goods previously handled by BINTEK Keuangan through settlement of facilities by the Directorate General of Customs and Excise;
• b. that the exemption and/or restitution of import duty and/or excise as well as uncollected value added tax and sales tax on luxury goods by the Directorate General of Customs and Excise need to be supervised;
• c. that based on the considerations as meant in letters a and b, it is necessary to stipulate technical directives for exemption and/or restitution of import duty and/or excise as well as uncollected value added tax and sales tax on luxury goods on the import of goods and/or materials to be processed, assembled or installed at other goods for the purpose of export;

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 the latest by Law No. 16/2000 (Statute Book of 2000 No. 126, Supplement to Statute Book No. 3984);
• 2. Law No. 8/1983 on value added tax on goods and services as well as sales tax on luxury goods (Statute Book of 1983 No. 50, Supplement to Statute Book No. 3263) as already amended the latest by Law No. 18/2000 (Statute Book of 2000 No. 128, Supplement to Statute Book No. 3986),
• 3. Law No. 10/1995 on customs affairs (Statute Book of 1995 No. 75, Supplement to Statute Book No. 3612);
• 4. Law No. 11/1995 on excise affairs (Statute Book of 1995 No. 76, Supplement to Statute Book No. 3613);
• 5. Government Regulation No. 33/1996 on bonded collection places (Statute Book of 1996 No. 50, Supplement to Statute Book No. 3638) as already amended by Government Regulation No. 43/1997 (Statute Book of 1997 No. 90, Supplement to Statute Book No. 3717);
• 6. Presidential Decree No. 177/2000 on organizational structures and tasks of ministries;
• 7. Presidential Decree No. 84/2001 on status, tasks, functions, organizational structures and working arrangements of vertical institutions within the Ministry of Finance;
• 8. Presidential Decree No. 228/M/2001;
• 9. Decree of the Minister of Finance No. 2/KMK.01/2001 on the organization and working arrangement of the Ministry of Finance;
• 10. Decree of the Minister of Finance No. 453/KMK.04/2002 on customs procedures in the import field as already amended several times and the latest by Decree of the Minister of Finance No. 112/KMK.04/2003;
• 11. Decree of the Minister of Finance No. 557/KMK.04/2002 on customs procedures in the export field;
• 12. Decree of the Minister of Finance No. 129/KMK.04/2003 on exemption and/or restitution of import duty and/or excise as well as uncollected value added tax and sales tax on luxury goods on the import of goods and/or materials processed, assembled or installed at other goods for the purpose of export.

DECIDES:

To stipulate:

THE DECISION OF THE DIRECTOR GENERAL OF CUSTOMS AND EXCISE ON TECHNICAL DIRECTIVES FOR EXEMPTION AND/OR RESTITUTION OF IMPORT DUTY AND/OR EXCISE AS WELL AS UNCOLLECTED VALUE ADDED TAX AND SALES TAX ON LUXURY GOODS ON THE IMPORT OF GOODS AND/OR MATERIALS TO BE PROCESSED, ASSEMBLED OR IN-STALLED TO OTHER GOODS FOR THE PURPOSE OF EXPORT AND SUPERVISION.

CHAPTER I
GENERAL PROVISION

Article 1

Referred to in this decision as :

• 1. Import shall be an activity of supply of goods into customs area.
• 2. Export shall be an activity of release of goods from customs area.
• 3. Exemption shall be exemption from import duty (BM) and/or excise on the import of goods and/or materials to processed, assembled or installed at other goods for the purpose of export or delivery to bonded zones,
• 4. Uncollected Value Added Tax (PPN) and Sales Tax on Luxury Goods (PPnBM) shall be facilities of uncollected PPN and PPnBM on the import of goods and/or materials to be processed, assembled or installed at other goods for the purpose of export, as long as the import of the goods and/or materials is exempted from import duty.
• 5. Restitution shall be restitution of import duty and/or excise already paid on the import of goods and/or materials to be processed, assembled or installed, which have been exported or delivered to bonded zones.
• 6. Directorate General shall be the Directorate General of Customs and Excise.
• 7. Director General shall be the Director General of Customs and Excise.
• 8. Regional Offices shall be certain regional offices of the Directorate General of Customs and Excise stipulated as service offices of export facilities.
• 9. Custom offices shall be customs and excise service offices.
• 10. Officials shall be employees of the Directorate General of Customs and Excise appointed in certain position to execute specified tasks.
• 11. Bonded zone shall be a building, place or area with certain limits wherein business activities of goods and material manufacturing industries, design, engineering, sorting, initial inspection, final inspection and packing of goods and materials from the import and other Indonesian customs area, with the output mainly destined for the export.
• 12. Companies shall be companies importing goods and/ or materials, processing, assembling or installing at other goods and exporting the production or delivering the production to bonded zone for processing, assembling or installing at other goods.
• 13. Customs and Excise Examination Report (LPBC)/Inspection Result Report (LHP) shall be report on customs inspection of exported goods originating from imported goods or materials securing exemption and/or restitution as well as uncollected PPN and PPnBM, issued by the Directorate General of Customs and Excise.
• 14. Promissory Notes (SSB) shall be letters issued by companies as guarantee for state levies on the imported goods and materials securing exemption and uncollected PPN and PPnBM.
• 15. Spoiled production shall be production facing damage or decrease in the quality/standard quality which technically cannot be repaired for meeting the expected quality/standard quality.
• 16. Remainder of production shall be raw materials or goods, which in the production process cannot be further processed into main production because it cannot be fulfilled technically.
• 17. By products shall be produced goods other than the main products, obtained during the production or being result of development and utilization of raw materials or remainder of production.
• 18. Spoiled raw materials shall be materials suffering decrease in the quality, unable to process or resulting in goods failing to meet the expected quality/standard quality if they are processed.
• 19. Realization of export shall be settlement of imported goods and/or materials securing exemption as well as uncollected PPN and PPnBM, with the production being exported.
• 20. Delivery to Bonded Zone shall be settlement of imported goods and/or materials securing the exemption as well as uncollected PPN and PPnBM, with the production being delivered to bonded zones for further processing.

Article 2

(1) Imported goods which will be processed, assembled of installed at other goods for the purpose of export can be given exemption as well as uncollected PPN and PPnBM.

(2) Restitution can be granted to imported goods to be processed, assembled or installed at other goods already paying import duty and/or excise and already exported.

(3) Production made of imported raw materials which is delivered to bonded zones for further processing can be given exemption and/or restitution as well as uncollected PPN and PPnBM.

(4) The exemption and/or restitution as well as uncollected PPN and PPnBM as meant in paragraphs (1), (2) and (3) shall be in exception to fuel, lubricant and capital goods.

(5) Production made of imported raw materials can be sold on the domestic market:

• a. maximally 7-5% of the total realization of export and/or delivery to bonded zones by paying import duty and/or excise as well as PPN and PPnBM.
• b. the total realization of export as meant in letter a is calculated from the export value.
• c. the total delivery to bonded zone as meant in letter a is calculated from the price of delivery to bonded zone.

(6) By products, remainder of production, spoiled production and spoiled raw materials made of imported raw materials can:

• a. be sold on the domestic market by paying import duty and/or excise as well as PPN and PPnBM;
• b. be destroyed by approval and supervision of official.

Article 3

The exemption and/or restitution as well as uncollected PPN and PPnBM as meant in Article 2 paragraphs (1), (2) and (3) shall be granted on behalf of the Minister of Finance by:

• 1. the Director of Customs Facilities, in the case of the exemption and/or restitution;
• 2. heads of certain regional offices stipulated for exemption.

CHAPTER II
CORPORATE REGISTRY NUMBER

Article 4

(1) Every company planning to submit application for securing the exemption and/or restitution as well as uncollected PPN and PPnBM shall have Corporate Registry Number (NIPER) issued by the Directorate General.

(2) In order to obtain NIPER, companies shall submit Corporate Primary Data (DIPER) to the Director of Customs Facilities by using form of DIPER which can be obtained at regional offices of certain customs offices;

(3) The form of DIPER shall be filled completely and truthfully and given up to the Directorate General of Customs Facilities and/or through regional offices.

(4) The form of DIPER shall be accompanied by:

• a. notary deed of establishment of company and the latest amendment;
• b. copy of Taxpayer Code Number (NPWP) and stipulation of Taxable Entrepreneurs (FKP);
• c. copy of Trading Business License (SIUP) from the Ministry of Industry and Trade;
• d. copy of Industrial Business License (SIUI) from the Ministry of Industry and Trade in the case of non-foreign/domestic investment companies;
• e. copy of principal license from the Investment Coordinating Board, in the case of foreign/domestic investment companies;
• f. copy of identity of executive directors and commissioners (KTP/passport/temporary stay permit (KIMS);
• g. evidence of ownership of office/factory;
• i. map of location of head office and factory.

(5) Based on the submitted DIPER, the Directorate of Customs Facilities or regional offices shall apply administrative and field examination to the truth of data meant in paragraph (2) by means of examining documents of DIPER, undertaking interview and observing factory.

(6) Results of the administrative and field examination shall be contained in account of:

• a. list of content of documents of results of survey of DIPER, according to Form SD-2.1;
• b. conclusion and results of survey of DIPER, according to Form SD-2.2;
• c. questionnaire of results of survey of DIPER according to Form SD-3.

(7) Regional offices shall convey DIPER already filled completely and results of the administrative and field examination as meant in paragraph (5) to the Director of Customs Facilities.

(8) The Director of Customs Facilities or the appointed official shall examine the truth data in DIPER and not later than 3 (three) clays as from the date of receipt of account of field examination:

• a. give approval if DIPER fulfills the requirements by issuing approval of DIPER directly sent to the relevant companies;
• b. ask completeness of data or attachment to DIPER in the case of the shortage of data; or
• c. convey rejection to application for NIPER.

(9) Form of DIPER as meant in paragraph (2) shall be in accordance with specimen in Attachment IX to this decision.

(10) Forms SD-2.1., SD-2.2 and SD-3 as meant in paragraph (6) shall be in accordance with specimen in Attachment IX to this decision.

(11) Procedures for issuing NIPER shall be regulated in Attachment I to this decision.

Article 5

(1) NIPER shall be issued by the Directorate General.

(2) In the case of applications for NIPER being already approved, the relevant companies shall:

• a. install billboard in location of their companies with writing:
  NAME OF COMPANY : ................
  NIPER : ................
• b. notify in writing the Director of Customs Facilities any change in data contained in DIPER,

(3) NIPER already owned by companies can be revoked by the Director general.

(4) NIPER shall be revoked in the case of:

• a. companies not importing goods and/or materials to produce exported goods for 12 (twelve months) consecutively as from :
• 1. the date of issuance of NIPER;
• 2. the date of realization of export and/or delivery to the latest bonded zone;
• b. companies not notifying change in data in DIPER in 30 (thirty) days as from the date of the change;
• c. based on the request of the said companies, following audit of exemption and/or restitution as well as uncollected PPN and PPnBM which have been obtained.

CHAPTER III
REQUIREMENTS FOR SECURING EXEMPTION
AS WELL AS UNCOLLECTED PPN AND PPnBM

Article 6

(1) Companies shall submit applications to the Director of Customs Facilities or heads of regional offices.

(2) The applications as meant in paragraph (1) shall use Form A1 and be accompanied by import and export plan and detail of the need for imported goods and materials for 12 (twelve) months by using Form A2.

(3) Companies submitting applications for exemption as well as uncollected PPN and PPnBM for the first time shall enclose:

• a. export contract or evidence of realization of export in the previous year;
• b. copy of taxpayer code number (NPWP);
• c. description of production process.

(4) The forms A1 and A2 as meant m paragraph (2) shall be in accordance with specimen in Attachment IX to this decision.

Article 7

(1) Approval or rejection of the applications as meant in Article 6 paragraphs (1) and (3) shall be given not later than 14 (fourteen) days as from the date of receipt of complete and true applications.

(2) In the case of applications for securing the exemption as well as uncollected PPN and PPnBM being approved, the Director of Customs Facilities or heads of regional offices shall issue decision on exemption from import duty and/or excise as well as uncollected PPN and PPnBM.

(3) Procedures for submitting the applications for exemption as well as uncollected PPN and PPnBM shall be regulated in Attachment II to this decision.

CHAPTER IV
GUARANTEE FOR IMPORT DUTY AND/OR EXCISE
AS WELL AS PPN AND PPnBM

Article 8

(1) Companies securing exemption as well as uncollected PPN and PPnBM shall give up guarantee amounting to import duty and/or excise, PPN and PPnBM before the imported goods and/or materials are processed, assembled or installed at other goods for exporting, releasing from bonded zones.

(2) The guarantee as meant in paragraph (1) shall be given up to the Directorate of Customs Facilities or regional offices, accompanied by PIB to be used for releasing goods from bonded zones.

(3) The Directorate of Customs Facilities or regional offices shall issue Guarantee Receipt (STTJ) used as complementary document of PIB.

Article 9

(1) The guarantee as meant in Article 9 can be in the form of:

• a. bank guarantee issued by foreign exchange banks;
• b. customs bond or surety bond issued by insurance firms appointed by the Minister of Finance;
• c. promissory note (SSB).

(2) The guarantee shall be amounting to the value of import duty and/or excise as well as PPN and PPnBM in PIB.

(3) Additional guarantee amounting to shortage of import duty, excise, PPN and PPnBM shall be given up if results of stipulation by customs offices find that the amount which must be paid is bigger than that mentioned in PIB.

Article 10

(1) Guarantee in the form of SSB shall be issued by companies and only apply to companies already securing approval from the Director of Customs Facilities.

(2) In order to enable companies to use guarantee in the form of SSB, the said companies shall submit applications to the Director of Customs Facilities and meet the following requirements:

• a. active to use exemption as well as uncollected PPN and PPnBM for 24 (twenty four) months as from the date when the exemption as well as uncollected PPN and PPnBM are issued to the companies for the first time;
• b. the cumulative value of goods already exported by the companies by using the exemption as well as uncollected PPN and PPnBM in the past 24 (twenty four) month up to the date of valuation is at least Rp 5,000,000,000.00 (five billion rupiahs);
• c. corporate financial statement has been audited by public accountant in the past two years and at least declared reasonable according to result of audit by public accountant;
• d. financial statement has been formulated on the basis of the Indonesian Financial Accountancy Standard;
• e. the companies have never had arrears of import duty, tax and other state levies; and
• f. the companies have never violated customs and excise provisions subjected to administrative sanction last year;

(3) Applications of companies for using SSB shall be examined periodically, twice in one year, in every second week of the following months:

• a. January, in the case of applications being submitted from July to December;
• b. July, in the case of applications being submitted from January to June.

(4) Evaluation of companies already using SSB shall be done periodically, twice in one year and in January and July.

(5) SSB shall be revoked in the case of companies:

• a. falsifying data and/or documents related to granting of exemption as well as uncollected PPN arid PPnBM;
• b. not exporting for 12 (twelve) months consecutively;
• c. changing in status into bonded zone operators (PKB);
• d. being declared dissolved or inactive to produce; and
• e. committing criminal violation in the taxation, customs and excise and banking fields.

(6) Revocation of rights to use SSB shall be stipulated by a decision of the Director of Customs Facilities.

Article 11

(1) The period of guarantee shall be at least 6 (six) months and shall be re-extended by companies in the case of the validity period of the guarantee expires while the realization of export of the imported goods and/or delivery to bonded zone have not been accounted wholly by the companies.

(2) The guarantee shall be extended not later than 14 (fourteen) days before the validity period of the guarantee expires.

(3) The guarantee already extended shall be conveyed to the Director of Customs Facilities or heads of regional offices not later than 3 (three) working days before the date of expiration of the guarantee.

(4) Procedures for receiving the guarantee, monitoring guarantee and monitoring PIB shall be regulated in Attachment III to this decision.

CHAPTER V
REALIZATION OF EXPORT DELIVERY TO
BONDED ZONE AND DOMESTIC SALES OF PRODUCTION

Part One
Realization of Export and Delivery to Bonded Zone

Article 12

(1) The export of production originating from imported goods and/or materials securing the exemption and/or restitution as well as uncollected PPN and PPnBM shall be done by using Export Declaration (PEB).

(2) PEB as meant in paragraph (1) shall be submitted by:

• a. companies holding NIPER which export their production directly;
• b. other companies being holders or non-holders of NIPER, whose goods are combined with production of the companies as meant in letter a.

(3) The export of production shall be realized in 12 months starting from the date of the import, with the exception that extension can be granted to the companies having production period of more than 12 months by the Director of Customs Facilities on behalf of the Minister of Finance.

(4) Customs Office shall issue LPBC/LHP to PEB having goods already exported.

(5) Procedures for submitting PEB securing export facilities shall be in accordance with the decision of the Director General of Customs and Excise on technical directives for customs procedures in the export field securing export facilities.

(6) Report on the export of production shall use forms A3 and A4 at least every six months.

Article 13

(1) Production shall be delivered to bonded zone for further processing by using BC 2.4. by companies holding NIPER with the provision that:

• a. the companies submit BC 2.4. to heads of customs offices overseeing territory of applicants;
• b. official applies customs inspection; and
• c. import duty and/or excise are exempted as well as PPN and PPnBM are not collected.

(2) Delivery of production to bonded zones shall be realized in 12 months as from the date of import.

(3) Report on delivery of production to bonded zones shall use form A7 and A8 at least every 6 (six) months.

(4) The Forms A7 and A8 as meant in paragraph (3) shall be in accordance with specimen in Attachment IX to this decision.

(5) Procedures for delivery of production to bonded zones shall be regulated in Attachment IV to this decision.

Article 14

(1) In the case of the provisions as meant in Article 12 paragraph (3) and Article 13 paragraph (2) being not fulfilled, producers shall pay import duty, excise, PPN and PPnBM.

(2) The obligation as meant in paragraph (1) shall be supplemented by interest as high as 2% of the levy which should be paid every month for 24 (twenty four) months at the maximum, starting from:

• a. the date of maturity of the 12 (twelve) month period as meant in paragraph (1), as long as the goods and/or materials are still located in stocks of companies;
• b. the date of maturity of the period stipulated by the Director General for the exception as meant in Article 12 paragraph (3).

(3) The obligation as meant in paragraphs (1) and (2) shall also be applied to companies having their NIPER revoked, already importing goods and/or materials which secure the exemption and uncollected PPN and PPnBM but the export has not been realized.

Part Two
Domestic Sale

Article 15

(1) Production made of imported raw materials can be sold on the domestic market after the export and/or delivery to bonded zones are realized with the provision that:

• a. BC 2.4 is submitted to heads of customs offices over seeing areas of applicants;
• b. the maximum quantity of goods to be sold domestically is 25% (twenty five percents) of the total export or delivery to bonded zones;
• c. official applies customs inspection;
• d. import duty and/or excise are paid on the basis of the tariff of goods and customs value on the basis of the value of raw materials upon importing; and
• e. PPN and PPnBM are paid with the basis for imposition of tax amounting to the import value plus sanction in the form of interest as high as 2% (two percents) per month starting from the date of the import for 24 (twenty four) months at the maximum.

(2) Domestic sales shall be realized in 12 (twelve) months as from the date of the import to the date of domestic sales.

(3) The realization of the export and/or delivery to bonded zone as meant in paragraph (1) letter b shall start from August 11, 2003.

(4) Report on domestic sales of production shall use Forms A9 and A10.

(5) The Forms A9 and A10 as meant in paragraph (4) shall be in accordance with specimen in Attachment IX to this decision.

(6) Procedures for domestic sales of production shall be regulated in Attachment V to this decision.

Article 16

(1) In the case of the quantity of domestic sales exceeding the provision as meant in Article 15 paragraph (1) letter b, the excess shall be:

• a. subjected to a fine of 100% (one hundred percents) of the total import duty and/or excise which should be paid;
• b. paying PPN and PPnBM in accordance with the value upon importing, plus sanction in the form of interest as high as 2% (two percents) per month as from the date of import for 24 (twenty four) months at the maximum.

(2) Domestic sales exceeding the provision as meant in Article 15 paragraph (2), as long as the goods are still in stocks of companies, shall:

• a. pay import duty and/or excise on the basis of tariffs of goods and customs value on the basis of the value of raw materials upon importing, plus interest as high as 2% (two percents) per month for 24 (twenty four) months at the maximum, starting from the date of maturity;
• b. pay PPN and PPnBM in accordance with the value upon importing, plus sanction in the form of interest as high as 2% (two percents) per month not later than 24 (twenty four) months as from the import.

CHAPTER VI
DOMESTIC SALES AND DESTRUCTION OF BY PRODUCT,
REMAINDER OF PRODUCTION, SPOILED PRODUCTION AND
SPOILED RAW MATERIALS

Article 17

(1) Domestic sales of by product, remainder of production, spoiled production and spoiled raw materials made of imported raw materials shall be done with the provision that.

• a. the companies submit BC 2.4 to heads of customs offices overseeing areas of applicants;
• b. official applies customs inspection;
• c. the companies pay import duty at a tariff of 5% of the selling price and excise in accordance with the provisions of tariff in force;
• d. the companies pay PPN and PPnBM in accordance with the value upon importing; and
• e. the companies pay import duty and/or excise as well as PPN and PPnBM upon domestic delivery of goods.

(2) Report on domestic sales of by product, remainder of production, spoiled production and spoiled raw materials made of imported raw materials shall use Forms A5 and A6.

(3) The Forms A5 and A6 as meant in paragraph (2) shall be in accordance with specimen in Attachment IX to this decision.

Article 18

(1) Destruction of by product, remainder of production, spoiled production and spoiled raw materials made of imported raw materials shall be done with the provision that:

• a. the companies submit BC 2.4 to heads of customs offices overseeing areas of applicants;
• b. official applies customs inspection;
• c. official supervise the destruction;
• d. import duty and/or excise as well as PPN and PPnBM are not collected; and
• e. result of destruction is contained in account.

(2) Report on destruction of by product, remainder of production, spoiled production and spoiled raw materials made of imported raw materials shall use Forms A5 and A6.

(3) Procedures for domestic sales and destruction of by product, remainder of production, spoiled production and spoiled raw materials made of imported raw materials shall be regulated in Attachment VI to this decision.

CHAPTER VII
REPORT ON SETTLEMENT OF GOODS AND/OR
MATERIALS MADE OF IMPORTED RAW MATERIALS AND
ADJUSTMENT OF GUARANTEE

Part One
REPORT ON EXPORT AND DELIVERY TO BONDED ZONES

Article 19

(1) Companies shall convey report on the implementation of the export by using form of Export Report (LE) to the Directorate of Customs Facilities or Regional Offices at least every 6 (six) months.

(2) In the case of companies directly exporting their production, the report shall be conveyed by using Forms A3 and A4, accompanied by:

• a. copy of PIB/PIBT/stipulation of sorting and imposition of excise on post freight (PPKP);
• b. copy of Order to Release Good (SPPB);
• c. copy of STTJ;
• d. original LPBC or LHP;
• e. copy of document CK-8 (especially for excisable goods);
• f. copy of PEB already securing export approval from official;
• g. copy of bill of lading (B/L) or airway bill (AWB) or other transport document treated such that;
• h. diskette of result of transfer of data of forms A3 and A4;

(3) In the case of companies not exporting their production directly (combined goods), LE shall be conveyed by using Forms A3 and A4, accompanied by:

• a. copy of PIB/PIBT/PPKP;
• b. copy of SPPB;
• c. copy of STTJ;
• d. original LPBC or LHP;
• e. copy of document CK-8 (especially for excisable goods);
• f. copy of PEB already securing export approval from official;
• g. copy of bill of lading (B/L) or airway bill (AWB) or other transport document treated such that;
• h. Letter of Transfer of Goods (SSTB); and
• i. diskette of result of transfer of data of forms A3 and A4.

Article 20

In the case of companies delivering their production to bonded zones for further processing, the report shall be conveyed to the Directorate of Customs Facilities or regional offices at least every six months by using Forms A7 and A8 along with:

• a. copy of PIB/PIBT/PPKP;
• b. copy of SPPB;
• c. copy of STTJ;
• d. copy of document CK-9 (especially for excisable goods);
• e. copy of PEB already securing expert approval from official;
• f. document of delivery of goods to bonded zones already ratified by officials (BC.2.4);
• g. diskette of result of transfer of data of forms A3 and A4.

Article 21

(1) The report as meant in Articles 19 and 20 conveyed by companies shall be approved if it fulfills the following requirements:

• a. being submitted by companies importing goods and/ or giving up their production or producers giving up their production to bonded zones for processing, assembling or installing at other goods;
• b. goods and/or materials imported for processing, assembling or installing at other goods have been exported or delivered to bonded zones;
• c. the export must be realized in 12 (twelve) months as from the date of import, excluding companies having a production period of above 12 (twelve) months and securing exception from the Director of Customs Facilities on behalf of the Minister of Finance;
• d. delivery to bonded zone must be realized in 12 (twelve) months as from the date of import to the date of delivery to bonded zones;
• e. the report has been accompanied by the required documents as meant in Articles 19 and 20.

(2) The report as meant in Articles 19 and 20 shall be denied unless it meets the requirements as meant in paragraph (1) and/or:

• a. the value of import duty/excise and value added tax/sales tax on luxury goods on materials in the report is higher than the value of import duty/excise and value added tax/sales tax on luxury goods in PIB;
• b. guarantee for the imported goods and/or materials based on the said PIB has been returned;
• c. the export is rather prioritized than the import;
• d. the value of imported raw materials of the exported goods or goods delivered to bonded zone is higher than the value of raw materials upon importing;
• e. completion of the report is not complete and/or true, including:
• 1) tariff heading/HS in the report different from tariff heading/HS in LPBC/LHP;
• 2) tariff heading/HS in the report different from tariff heading/HS in PIB;
• 3) the quantity of the exported goods in the report is bigger than the quantity of exported goods in LPBC.

Part Two
Report on Domestic Sales and Destruction

Article 22

(1) Report on domestic sales of production shall use Forms: A9 and A10, accompanied by:

• a. copy of PIB/PIBT/PPKP already securing SPPB/out going approval from official;
• b. copy of STTJ;
• c. copy BC 2.4;
• d. domestic sale invoice; and
• e. selling contract.

(2) Report on destruction/domestic sales of by products, remainder of production, spoiled production, spoiled raw materials shall use Forms A5 and A6, accompanied by

• a. copy of PIB/PIBT/PPKP already securing SPPB/outgoing approval from official;
• b. copy of STTJ;
• c. copy BC 2.4;
• d. domestic sale invoice or account of destruction.

(3) Report on the payment of Import Duty and/or excise, uncollected value added tax and sales tax on luxury goods on the imported raw materials with the accountability for their export being not held yet shall use Forms A5 and A6, accompanied by:

• a. copy of PIB/PIBT/PPKP already securing SPPB/outgoing approval from official;
• b. copy of STTJ;
• c. copy BC 2.4.

Article 23

(1) The report as meant in Article 22 paragraph (1) conveyed by companies shall be approved if it meets the following requirements:

• a. being submitted by companies importing goods and/ or materials and exporting their production or giving up their production to bonded zones, which sell their production in the country;
• b. the sales as meant in letter a is executed after the realization of the export which must be done in 12 (twelve) months, starting from the date of the im-port, except companies having a production period of above 12 (twelve) months and securing exception from the Director of Customs Facilities on behalf of the Minister of Finance;
• c. the report has been accompanied by the required documents as meant in Article 22 paragraph (1).

(2) The report as meant in Article 22 paragraph (1) shall be denied unless it meets the requirements as meant in paragraph (1) and/or:

• a. the value of import duty/excise and value added tax/ sales tax on luxury goods on materials in the report is higher than the value of import duty/excise and value added tax/sales tax on luxury goods in PIB;
• b. guarantee for the imported goods and/or materials based on the said PIB has been returned;
• c. domestic sales are rather prioritized than the export or delivery to bonded zones;
• d. the value of imported raw materials of goods sold in the country is higher than the value of imported raw materials of the exported goods or goods delivered to bonded zones;
• e. the value of imported raw materials of goods sold in the country is bigger than the value of raw materials upon importing;
• f. completion of the report is not complete and/or true, including:
• 1) tariff heading/HS in the report different from tariff heading/HS in BC 2.4;
• 2) tariff heading/HS in the report different from tariff heading/HS in PIB;

Article 24

(1) The report as meant in Article 22 paragraph (2) conveyed by companies shall be approved if it fulfills the following requirements:

• a. being submitted by companies importing goods and/ or materials as well as selling and/or destroying by products, remainder of production, spoiled production, spoiled raw materials which cannot be exported or delivered to bonded zones;
• b. the domestic sales as meant are realized in 12 (twelve) months as from the date of the import, except companies having a production period of above 12 months and already securing exception from the Director of Customs Facilities on the behalf of the Minister of Finance;
• c. the report has been accompanied by the required documents as meant in Article 22 paragraph (2).

(2) The report as meant in Article 22 shall be denied unless it meets the requirements as meant in paragraph (1) and/or:

• a. the value of import duty/excise and value added tax/ sales tax on luxury goods on materials in the report is higher than the value of import duty/excise and value added tax/sales tax on luxury goods in PIB;
• b. guarantee for the imported goods and/or materials based on the said PIB has been returned;
• c. the value of imported raw materials of goods sold in the country and/or destroyed is higher than the value of raw materials upon importing;
• d. completion of the report is not complete and/or true, including:
• 1) tariff heading/HS in the report different from tariff heading/HS in LPBC/LHP;
• 2) tariff heading/HS in the report different from tariff heading/HS in PIB.

(3) Procedures for examining the report as meant in Articles 19, 20 and 22 shall be regulated in Attachment VII to this decision.

Part Three
Guarantee Adjustment

Article 25

(1) In the case of the report as meant in Articles 19, 20 and 22 being approved, the Director of Customs Facilities or Heads of Regional Offices shall issue Guarantee Adjustment Declaration (SPPJ) showing the amount of import duty and/or excise as well as value added tax and sales tax on luxury goods which have been accounted and/or must be guaranteed by companies.

(2) If the amount of import duty, excise, value added tax and sales tax on luxury goods has to be guaranteed, companies can substitute the guarantee once conveyed minimally as much as the value of guarantee stipulated in SPPJ.

(3) Bank guarantee or customs bond issued to substitute guarantee once conveyed can be in the form of bank guarantee or customs bond from the same or different underwriters.

(4) In the case of import duty, excise, value added tax and sales tax on luxury goods being already accounted, the guarantee shall be returned not later than 12 (fourteen) working days after the latest SPPJ is issued.

CHAPTER VIII
RESTITUTION

Article 26

Restitution can be granted to:

• 1. companies exporting their production directly;
• 2. companies delivering their production to bonded zones.

Article 27

In order to obtain the restitution as meant in Article 26, producers shall meet the following requirements:

• 1. in the case of the exported goods:
• a. officials have undertaken physical inspection;
• b. date of LPBC/LHP does not exceed 12 (twelve) months as from the date of B/L or AWB or other transport documents treated such, up to the date of receipt of application by the Directorate General;
• c. the import has been realized not later than 24 (twenty four) months before the shipment of exported goods.
• 2. In the case of goods being delivered to customs zones:
• a. officials have undertaken physical inspection;
• b. the date of note of inspection of official does not exceed 12 (twelve) months as from the date of inspection up to the date of receipt of application by the Directorate General;
• c. the import has been realized not later than 24 (twenty four) months before the delivery to bonded zone.

Article28

(1) Applications for restitution shall be submitted to the Director General or the appointed official.

(2) The application shall be submitted by using Form B by enclosing:

• a. in the case of the exported goods:
• 1. list of linkage of the imported goods and/or materials to the exported goods or goods delivered to bonded zone by using Form B3;
• 2. import documents in the form of:
• a) copy of PIB/PIBT/PPKP already securing SPPB/ outgoing approval from official;
• b) 3rd sheet of original SSBC/SSPCP;
• 3. export documents in the form of:
• a) copy of PEB already securing export approval from official;
• b) original LPBC/LHP;
• c) copy of B/L and AWB or other transport documents treated such;
• b. In the case of goods being delivered to bonded zones, documents of delivery of goods to bonded zones in the form of:
• 1. BC 4.0;
• 2. Tax invoice;
• 3. copy of contract of sales to bonded zones.

(3) The Forms B and B3 as meant in paragraph (2) shall be in accordance with specimen in Attachment IX to this decision.

Article 29

(1) Applications for restitution of import duty and/or excise shall be processed for approval or rejection in 14 (fourteen) working days, starting from the date of receipt of complete and true applications.

(2) Procedures for granting restitution of import duty and/ or excise shall be regulated in Attachment VIII to this decision.

CHAPTER IX
SUPERVISION

Article 30

Companies receiving the exemption and/or restitution as well as uncollected PPN and PPnBM shall store and maintain documents, books; records as well as letters related to the exemption and/or restitution for 10 (ten) years in their business places in Indonesia.

Article 31

(1) Supervision over the granting of exemption and/or restitution as well as uncollected PPN and PPnBM shall be executed by means of physical inspection and/or audit of companies receiving the exemption and/or restitution as well as uncollected PPN and PPnBM.

(2) Physical inspection and audit in the customs and excise field can be executed any time in accordance with the provisions in force.

Article 32

(1) The Directorate of Customs Facilities shall examine periodically data on bookkeeping of companies receiving the exemption as well as uncollected PPN and PPnBM as well as restitution on the basis of data notified in DIPER.

(2) in the case of the supervision as meant in paragraph (1), data on bookkeeping of companies being not suitable to DIPER, the Director of Customs Facilities can determine:

a. customs audit; and/or

b. revocation of NIPER.

Article 33

If NIPER of companies receiving the exemption as well as uncollected PPN and PPnBM is revoked, the import duty and/or excise as well as PPN and PPnBM shall be settled not later than 30 (thirty) days as from the date of revocation.

CHAPTER X
MISCELLANEOUS PROVISION

Article 34

The exemption as well as uncollected PPN arid PPnBM also can be granted to companies not working production wholly with the provision that:

• 1. companies not working production wholly give sub-contract to other companies;
• 2. the implementation of the work as meant in point (1) must have working contract; and
• 3. the granting of work from companies to sub-contract companies secures prior approval from the Director of Customs Facilities or Heads of Regional Offices.

Article 35

(1) Unless materials and/or goods whose raw materials secure exemption as well as uncollected PPN and PPnBM which should be exported or must exist in companies are accountable, recipients of exemption as well as uncollected PPN and PPnBM shall:

• a. pay import duty and/or excise plus a fine of 100% (one hundred percents) of import duty and/or excise which should be paid;
• b. pay PPN and PPnBM previously uncollected plus sanction in accordance with the taxation provisions in force.

(2) Procedures for payment of import duty and/or excise fine and interest as well as payment of PPN arid PPnl31 as well as interest as meant in paragraph (1) shall be in accordance with the provisions in force.

Article 36

(1) If exported goods once securing the exemption as well as uncollected PPN and PPnBM and/or restitution and re-imported, upon the import, companies shall:

• a. submit PIB;
• b. give up guarantee amounting to import duty and/excise at the price and tariff of products, accompanied by evidences of export in the form of copy of PEB and copy of LPBC/LHP ratified by official to head of customs and excise service offices overseeing the import place; and
• c. pay PPN and PPnBM in accordance with the provisions in force.

(2) Customs inspection shall be applied to the exported goods as meant in paragraph (1).

(3) If the exported goods which are re-imported as meant in paragraph (1) are unable to re-export in 6 (six) months, the guarantee amounting to import duty and/ or excise as meant in paragraph (1) shall be disbursed.

Article 37

(1) In the case of result of audit reflecting the excess of exemption, with regard to the excess, recipients of the exemption as well as uncollected PPN and PPnBM shall:

• a. pay import duty and/or excise plus a fine of 100% (one hundred percents) of import duty and/or excise which should be paid, plus interest on the excess of the exemption as high as 2% (two percents) per month for 24 (twenty four) months at the maximum, starting from the date of PIB;
• b. pay PPN and PPnBM previously uncollected, plus sanction in accordance with the taxation provisions in force.

(2) In the case of result of audit reflecting the excess of restitution, the excess shall be returned and subjected to a sanction of 100% (one hundred percents) plus interest on the excess of restitution as high as 2% (two percents) per month for 24 (twenty four) months at the maximum, starting from the date of Repayment Order (SPMK).

(3) If re-export is able to prove in 12 (twelve) months as from the date of the import, the exemption as meant in paragraph (1) shall not be subjected to import duty and/ or excise, fine and interest.

Article 38

(1) The amount of sanction in the form of interest which should be paid as meant in:

• a. Article 14 paragraph (2);
• b. Article 15 paragraph (1) letter e;
• c. Article 16 paragraph (1) letter b and paragraph (2) letter b;
• d. Article 17 paragraph (1) letter e;
• e. Article 35 paragraph (1) letter b;
• f. Article 37 paragraph (2)

shall be stipulated by the Director of Taxation.

(2) For the purpose of stipulation of sanction in the form of fine as meant in paragraph (1) letters a, b, c and d, heads of customs service offices shall send documents BC 2.4 already approved by official for settlement of sanction in the form of interest on PPN and PPnBM to the Director General of Taxation in this case Heads of Tax Service Offices where companies are registered as taxable entrepreneurs.

(3) For the purpose of stipulation of sanction in the form of fine as meant in paragraph (1) letters e and f, heads of customs service offices shall send documents SPKPBM to the Director General of Taxation in this case Heads of Tax Service Offices where companies are registered taxable entrepreneurs.

CHAPTER XI
TRANSITIONAL PROVISION

Article 39

(1) All decisions on the exemption and/or restitution as well as uncollected PPN and PPnBM issued by the Head of Bapeksta Keuangan/Head of BINTEK Keuangan or the appointed officials which remain effective shall remain valid until validity period of the said decision ends.

(2) Applications for exemption and/or restitution as well as uncollected PPN and PPnBM not yet settled by BINTEK Keuangan up to July 31, 2003 shall be further settled by the Directorate of Customs and Excise.

(3) Supervision and monitoring of guarantees (bank guarantee, customs bond and SSB) for the import using the exemption not yet accounted up to July 31, 2003 shall be further settled by the Directorate of Customs and Excise.

(4) Claims on exemption and/or restitution as well as un collected PPN and PPnBM which are still unsettled n BINTEK Keuangan up to July 31, 2003 shall be further settled by the Directorate of Customs and Excise.

CHAPTER XII
CONCLUSION

Article 40

The decision shall come into force as from August 1, 2003.

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

Stipulated in Jakarta
On July 4, 2003
THE DIRECTOR GENERAL
sgd
EDDY ABDURRACHMAN

Attachment to DECISION OF DIRECTOR GENERAL OF CUSTOMS AND EXCISE
NO. KEP-141/BC/2003