FINANCE MINISTRY OF REPUBLIC OF INDONESIA
DIRECTORATE GENERAL OF CUSTOMS AND EXCISE

DECISION OF DIRECTOR GENERAL OF CUSTOMS AND EXCISE
No. KEP-205/BC/2003

ON
DIRECTIVES FOR IMPLEMENTATION OF MANAGEMENT OF IMPORT FACILITIES
FOR EXPORT DESTINATION AND ITS SUPERVISION

DIRECTOR GENERAL OF CUSTOMS AND EXCISE,

Attachment

Considering:

• a. whereas in order to increase non oil and gas export it is deemed necessary to simplify the procedures of extending Import Facilities for Export Destination;
• b. whereas a supervision is necessary for the implementation of awarding of Import Facilities for Export Destination;
• c. whereas in order to support the implementation as intended in point a and b, an integrated electronic system is necessary;
• d. whereas based on considerations as intended in points a, b and c, it is necessary to stipulate a Decision of DIRECTOR GENERAL OF CUSTOMS AND EXCISE on Directives for Implementation of Managing Import Facilities for Export Destination and the Supervision;

In View of:

• 1. Law No. 6/1983 on General Provision And Customs and Manners of Taxation (Statutory Gazette of Republic of Indonesia 1983 No. 49, Supplementary Statutory Gazette of Republic of Indonesia No. 3262) as amended lastly by Law No. 16/2000 (Statutory Gazette of Republic of Indonesia 2000 No. 126, Supplementary Statutory Gazette of Republic of Indonesia No. 3984);
• 2. Law No. 8/1983 on Value Added Tax for Goods and Service And Sales Tax For Luxurious Goods (Statutory Gazette of Republic of Indonesia 1983 No. 51, Supplementary Statutory Gazette of Republic of Indonesia No. 3264) as several time amended lastly by Law No. 18/2000 (Statutory Gazette of Republic of Indonesia 2000 No. 128, Supplementary Statutory Gazette of Republic of Indonesia No. 3986);
• 3. Law No. 10/1995 on Customs (Statutory Gazette of Republic of Indonesia 1995 No. 75, Supplementary Statutory Gazette of Republic of Indonesia No. 3612);
• 4. Law No. 11/1995 on Duty (Statutory Gazette Republic of Indonesia 1995 No. 76, Supplementary Statutory Gazette Republic of Indonesia No. 3613);
• 5. Government Regulation No. 33/1996 on Bound Hoarding Area (Statutory Gazette of Republic of Indonesia 1996 No. 50, Supplementary Statutory Gazette Republic of Indonesia No. 3638) as amended by Government Regulation No. 43/1997 (Statutory Gazette of Republic of Indonesia 1997 No. 90, Supplementary Statutory Gazette of Republic of Indonesia No. 3717);
• 6. Presidential Decree No. 177/2000 on Ministerial Structure of Organization And Duties;
• 7. Presidential Decree No. 84/2001 on Position, Duties, Function, Structure of Organization And Work Procedures of Vertical Department in Finance Ministry;
• 8. Presidential Decree No. 228/M/2001;
• 9. Decision of Finance Minister No. 101/KMK.01/1997 on Customs Notification as several time amended and lastly by Decision of Finance Minister No. 346/KMK.04/2003;
• 10. Decision of Finance Minister No. 2/KMK.01/2001 on Work Procedures Organization of Finance ministry;
• 11. Decision of Finance Minister No. 453/KMK.04/2002 on Customs Management for Import as several time amended and lastly by Decision of Finance Minister No. 112/KMK.04/2003;
• 12. Decision of Finance Minister No. 557/KMK.04/2002 on Customs Management for Export;
• 13. Decision of Finance Minister No. 580/KMK.04/2003 on Managing Import Facilities for Export Destination and the Supervision.

DECIDES:

To Stipulate:

DECISION OF DIRECTOR GENERAL OF CUSTOMS AND EXCISE ON DIRECTIVES FOR IMPLEMENTATION OF MANAGING IMPORT FACILITIES FOR EXPORT DESTINATION AND THE SUPERVISION

CHAPTER I
GENERAL PROVISION

Article 1

In this Decision of Director General, meant by:

• 1. Import shall be activities of bringing goods into Customs Area.
• 2. Export shall be activities of bringing goods out of Customs Area.
• 3. Import Facilities for Export Destination (KITE) shall be awarding of exemption and/or repayment of Import Duty (BM) and/or Excise and VAT and Non collectible Sales Tax for Luxurious Goods for import of goods and/or materials to process, assemble, or fix on other goods of which the products are mainly for export destination.
• 4. Exemption shall be exemption of Import Duty (BM) and/or Excise for import of goods and/or materials to process, assemble, or fix on other goods to be exported or supplied to Bound Area.
• 5. Value Added Tax (VAT) and Non Collectible Sales Tax for Luxurious Goods (PPnBM) shall be facilities of non collectible VAT and PPnBM for import of goods and/or materials to process, assemble, or fix on other goods to be exported, provided that the import of such goods and/or materials is exempted from BM.
• 6. Repayment shall be repayment of BM and/or Excise that has already been paid for import of goods and/or materials to process, assemble, or fix on other goods that have been exported or supplied to Bound Area.
• 7. Directorate General shall be DIRECTORATE GENERAL OF CUSTOMS AND EXCISE.
• 8. Director General shall be DIRECTOR GENERAL OF CUSTOMS AND EXCISE.
• 9. Regional Office shall be Regional Office of DIRECTORATE GENERAL OF CUSTOMS AND EXCISE designated for providing KITE service.
• 10. Customs Office shall be Customs and Excise Service Office.
• 11. Official shall be employee of DIRECTORATE GENERAL OF CUSTOMS AND EXCISE appointed in specific capacity to exercise specific duties.
• 12. Bonded Zone shall be a premise, place or area with certain borders in which industrial business activities of goods and material processing, development activities, engineering, sorting, initial inspection, final inspection, and packaging of imported goods and materials or goods and materials from other Indonesian Customs Areas, of which the products are mainly for export destination.
• 13. Company shall be company securing KITE importing goods and/or materials, processing, assembling or fixing on other goods and exporting itself the products or delivering the products to Bonded Zone to be processed, assembled or installed on other goods.
• 14. Customs Inspection Report (LPBC)/Inspection Result Report (LHP) shall be customs Inspection Result Report for exported goods originating from imported goods or materials securing Exemption and/or Repayment Uncollected VAT and Sales Tax for Luxurious Goods issued by DIRECTORATE GENERAL OF CUSTOMS AND EXCISE.
• 15. Letter of Undertaking (SSB) shall be letter issued by company as warranty for state levies for imported goods and materials securing Exemption Uncollected VAT and Sales Tax for Luxurious Goods.
• 16. Order of Repayment of Import Duty and/or Excise (SPMK) shall be Order of Repayment of Import Duty and/or Excise signed by Head of Customs at the Regional Office of DIRECTORATE GENERAL OF CUSTOMS AND EXCISE on behalf of the Finance Minister.
• 17. Fault Products shall be products undergoing decay or decline of quality technically unfixable to satisfy the expected quality.
• 18. Production Leftover shall be Raw Material or goods in the process of production that cannot be processed further into main products as they do not satisfy the technical requirements.
• 19. By-Products shall be goods produced in addition to the main products, obtained during the production process or being the outcome of development and usage of Raw Material, Raw Material scraps, or Production Leftover.
• 20. Fault Raw Material shall be Raw Material undergoing decline of quality, unprocessible or if processed, the outcome does not satisfy the expected quality standard.
• 21. Export Realization shall be completion of imported goods and/or material securing Exemption Uncollected VAT and Sales Tax for Luxurious Goods from Company, the products of which are for export.
• 22. Supply to Bonded Zone shall be completion of imported goods and/or material securing Exemption Uncollected VAT and Sales Tax for Luxurious Goods from Company, the products of which are supplied to Bonded Zone for further process.
• 23. Supply from Bonded Zone shall be supply of products from Bonded Zone to Company to be processed, assembled, or installed on other goods, of which the products are mainly for export destination.

Article 2

(1) Exemption of Uncollected VAT and Sales Tax for Luxurious Goods may be given for imported goods and/or material to be processed, assembled, or installed on other goods at Company for export.

(2) Repayment may be awarded for imported goods and/or material and/or products from Bonded Zone to be processed, assembled, or installed on other goods whose BM and/or Excise have been paid and exported.

(3) Exemption and/or Repayment Uncollected VAT and Sales Tax for Luxurious Goods may be given for products with imported Raw Material supplied to Bonded Zone for further process.

(4) Exemption and/or repayment Uncollected VAT and Sales Tax for Luxurious Goods as intended in paragraph (1), (2) and (3) not including fuel material, lubricant oil, and capital goods.

(5) For products of Company with imported Raw Material, they may be sold to Other Indonesian Customs Area (DPIL):

• a. Maximum 25 % of total Export Realization and/or supplied to Bonded Zone by paying BM and/or Excise and VAT as well as PPnBM;
• b. Total Export Realization as intended in point a shall be considered from export value;
• c. Number supplied to Bonded Zone as intended in point a shall be considered from supply price to Bonded Zone.

(6) By-Products, Production Leftover, Fault Products and Fault Raw Material with imported Raw Material may be:

• a. sold to DPIL by paying BM and/or Excise and VAT as well as PPnBM; or
• b. destroyed at the consent and under supervision of the Official.

Article 3

Awarding of Exemption and/or Repayment Uncollected VAT and Sales Tax for Luxurious Goods as intended in Article 2 paragraph (1), (2), and (3) shall be conducted on behalf of the Finance Minister, by Head of Regional Office.

CHAPTER II
COMPANY REGISTRATION NUMBER

Article 4

(1) Every company wishing to submit application for securing Exemption and/or Repayment Uncollected VAT and Sales Tax for Luxurious Goods should have Company Registration Number (NIPER) issued by Regional Office.

(2) In order to obtain NIPER, company should submit complete and true Company Main Data (DIPER) to Head of Regional Office electronically.

(3) Based on submission of DIPER, Regional Office shall carry out administrative and field investigation in order to verify the data as intended in paragraph (2) by examining DIPER documents, interviewing and visiting the plant.

(4) The result of administrative and field investigation as intended in paragraph (3) shall be carried out at the latest 14 (fourteen) business days commencing receiving DIPER data.

(5) In case the location of inspected object is outside the relevant Regional Office area of supervision, the visit to the plant may be delegated to the Customs Office supervising the inspected object.

(6) The result of administrative investigation and plant visit shall be made in Minutes of Survey Result Conclusion.

(7) Head of Regional Office or Official appointed to carry out verification of DIPER data and within at the latest 3 (three) business days commencing receipt of Minutes of Survey Result Conclusion, the survey result shall be supplied electronically to the company in form of:

• a. Issuance of NIPER in case it satisfies the requirements; or
• b. Rejection in case it does not satisfy the requirements.

(8) Application as intended in paragraph (1) shall be in accordance with the model in Attachment XII hereto.

(9) Minutes as intended in paragraph (6) shall be in accordance with Attachment XII hereto.

(10) Procedures of issuance of NIPER shall be as provided for in Attachment I hereto.

Article 5

(1) NIPER shall be issued by Head of Regional Office.

(2) Company whose application for NIPER has been approved should:

• a. post a board sign at the company location mentioning:
• COMPANYS NAME : ...............
  NIPER : ...............
• b. notify in writing the Head of Regional Office concerning any change of data existing in DIPER.

(3) The NIPER owned by a company may be revoked by the Head of Regional Office in case:

• a. the company does not carry out activities of importing goods and/or material to produce exported goods within 12 (twelve) months consecutively commencing:
• 1. Issuance of NIPER; or
• 2. Date of Export Realization and/or the latest supply to Bonded Zone.
• b. the company does not notify change of data in DIPER within 30 (thirty) days commencing such change occurrence;
• c. at the request of the company concerned, following an audit for Exemption and/or Repayment Uncollected VAT and Sales Tax for Luxurious Goods obtained.

(4) In case the NIPER of company receiving Exemption and/or Repayment Uncollected VAT and Sales Tax for Luxurious Goods is revoked, the indebted BM and/or Excise and VAT as well as PPnBM and any fine existing should be paid off at the latest 30 (thirty) days commencing such revocation.

CHAPTER III
Exemption Uncollected VAT and Sales Tax for Luxurious Goods

Part One
Requirements to Obtain Exemption Uncollected VAT and Sales Tax for Luxurious Goods.

Article 6

(1) In order to obtain Exemption Uncollected VAT and Sales Tax for Luxurious Goods, Company shall submit an application to the Head of Regional Office.

(2) Application as intended in paragraph (1) shall attach Form BCF.KT01 containing import and export plan and details of needs of imported goods and/or Raw Material and output products for 12 (twelve) months and Customs Office clearing the imported goods and/or Raw Material.

(3) Company applying for the first time for exemption Uncollected VAT and Sales Tax for Luxurious Goods, should attach:

• a. Export contract or Export Realization evidence for 1 (one) previous year;
• b. Copy of NPWP; and
• c. Details of production process.

(4) Application as intended in paragraph (1) shall be in accordance with model in Attachment XII hereto.

(5) Form BCF.KT01 as intended in paragraph (2) shall be in accordance with model in Attachment XII hereto.

(6) Procedures of application for exemption Uncollected VAT and Sales Tax for Luxurious Goods shall be as provided for in Attachment II hereto.

Article 7

(1) Approval or rejection as intended in Article 6 paragraph (1) and paragraph (3) shall be awarded at the latest 14 (fourteen) business days commencing receipt of complete and true application.

(2) In case application to obtain exemption Uncollected VAT and Sales Tax for Luxurious Goods:

• a. is approved, the Head of Regional Office shall issue a Decree of Exemption of Import Duty and/or Excise Uncollected VAT and Sales Tax for Luxurious Goods; or
• b. is refused, the Head of Regional Office shall issue a Rejection Letter.

(3) Decree of Exemption of Import Duty and/or Excise Uncollected VAT and Sales Tax for Luxurious Goods as intended in paragraph (2) shall be sent electronically to Customs Office clearing imported goods/Raw Material.

Part Two
Warranty for Indebted Import Duty and/or Excise and VAT as well as PPnBM

Article 8

(1) Company securing Exemption Uncollected VAT and Sales Tax for Luxurious Goods, shall be obliged to furnish PIB and warranty amounting to the value of BM and/or Excise and VAT as well as PPnBM in PIB, prior to clearance of imported goods and/or material to be processed, assembled, or installed on other goods for export from Customs Area.

(2) Warranty as intended in paragraph (1) shall be furnished to the Regional Office along with PIB to use for clearing goods from Customs Area or Bonded Zone.

(3) Head of Regional Office or appointed official shall issue Warranty Receipt (STTJ) as attachment to PIB.

(4) STTJ as intended in paragraph (3) shall be supplied electronically to Customs Office clearing imported goods/Raw Material.

Article 9

(1) Warranty as intended in Article 8 may be in form of:

• a. Bank Guarantee issued by Foreign Exchange Bank;
• b. Customs Bond or Surety Bond issued by insurance company designated by the Finance Minister;
• c. Letter of Undertaking (SSB).

(2) The warranty shall be amounting to the value of BM and/or Excise and VAT as well as PPnBM in PIB.

(3) In case the Customs Office finds that the amount payable is greater than the amount set forth in PIB, the Entrepreneur shall be obliged to furnish additional warranty amounting to the required BM, Excise, VAT and PPnBM or substitute warranty amounting to BM, Excise, VAT and PPnBM.

Article 10

(1) Warranty in term of SSB shall be issued by the company itself and only applicable for company securing approval from the Head of Regional Office.

(2) In order to be eligible to present SSB as warranty, a company should submit an application to the Head of Regional Office and fulfill requirements as follows:

• a. Actively use Exemption Uncollected VAT and Sales Tax for Luxurious Goods for 24 (twenty four) months commencing the first issuance of Decision of Awarding of Exemption Uncollected VAT and Sales Tax for Luxurious Goods to the said company;
• b. the cumulative value of goods exported by the company using Exemption Uncollected VAT and Sales Tax for Luxurious Goods for the last 24 (twenty four) months until the assessment date shall be at least Rp. 5.000.000.000,00 (five billion rupiah);
• c. The Financial Statement has been prepared based on Indonesian Standard of Accounting;
• d. The Financial Statement of the company has been audited by Public Accountant for the last 2 (two) years and shall at least be deemed reasonable according to the Public Accountant;
• e. Never has indebted BM, Excise, tax, and other state levies in arrears; and
• f. Never breaks customs and excise provisions exposing to administrative sanction within the last 1 (one) year.

(3) Assessment of companys application to use SSB may be carried out periodically 2 (twice) a year and during the second week of the month:

• a. January, for application submitted during July to December;
• b. July, for application submitted during January to June.

(4) Evaluation for company using SSB shall be carried out periodically 2 (twice) a year respectively in January and July.

(5) SSB may be revoked in case a company:

• a. falsify the data and or documents related to awarding of Exemption Uncollected VAT and Sales Tax for Luxurious Goods;
• b. does not carry out export for 12 (twelve) months consecutively;
• c. changes its status into Bonded Zone Entrepreneur (PKB);
• d. is liquidated or inactive; and
• e. commits criminal breaches in taxation, customs and excise, trade and banking.

(6) Revocation of rights to use SSB shall be made in a Decision of Head of Regional Office.

Article 11

(1) The term of the warranty shall be at least 6 (six) months and should be re-extended by the in case the term of the warranty expires while the imported goods have not been fully accounted for the Export Realization and/or supply to the Bonded Zone by the company.

(2) The warranty should be extended at the latest 14 (fourteen) business days prior to its expiration.

(3) The extended warranty should be furnished to the Head of Regional Office at the latest 3 (three) business days prior to the expiration.

(4) The procedures of warranty receipt, warranty monitoring, and monitoring of PIB shall be as provided for in Attachment III hereto.

Part Three
Clearance of Imported Goods and/or Raw Material from Customs Area

Article 12

(1) Clearance of imported goods and/or Raw Material securing Exemption Uncollected VAT and Sales Tax for Luxurious Goods out of Customs Area shall be carried out using Goods Importation Notification (PIB).

(2) PIB as intended paragraph (1) shall be proposed by the Company holder of NIPER processing by itself manufactured goods made of imported goods or Raw Material.

(3) PIB application should enclose STTJ and SSPCP for PPH payment.

(4) Procedures of clearance of imported goods shall be pursuant to the Decision of Director General on Directives for Management of Customs in Import Field.

Part Four
Export Realization, Supply to Bonded Zone And Sales to
DPIL of Products

Article 13

(1) Export of products made of imported goods and/or material and/or products from Bonded Zone securing Exemption Uncollected VAT and Sales Tax for Luxurious Goods shall be carried out under Goods Export Notification (PEB).

(2) PEB as intended paragraph (1) shall be proposed by:

• a. Company holder of NIPER exporting its products on its own; or
• b. Other Company either holder of NIPER or non holder of NIPER, whose goods are mixed with the products of the company as intended in point a.

(3) Export of products should have been carried out within 12 months commencing registration of PIB, unless for company with production term more than 12 months that may be given exception by the Head of Regional Office on behalf of the Finance Minister.

(4) Customs Office shall issue LPBC/LHP for PEB securing KITE facilities that have exported the products.

(5) The procedures of application for PEB securing KITE facilities shall be carried out pursuant to the Decision of Director General on Directives for Implementation of Management of Customs in Export Field for Exported Goods Securing Import Facilities for Export Destination.

Article 14

(1) Products made of imported Raw Material may be supplied by the company holder of NIPER to Bonded Zone for further process, provided that:

• a. applying for BC 2.4 to the Customs Office supervising the applicants area;
• b. customs inspection is carried out by the Official; and
• c. BM and/or Excise are exempted Uncollected VAT and Sales Tax for Luxurious Goods.

(2) Supply of products to Bonded Zone should have been done within 12 months commencing registration of PIB.

(3) The procedures of supply of products to Bonded Zone shall be as provided for in Attachment IV hereto.

Article 15

(1) In case the provision as intended in Article 13 paragraph (3) and Article 14 paragraph (2) are not fulfilled, the entrepreneur shall be obliged to pay indebted BM, Excise, VAT, and PPnBM.

(2) Obligation as intended in paragraph shall (1) include 2 % (two percent) interest of the levies that is payable every month at the latest 24 (twenty four) months commencing registration of PIB, provided that the goods and/or material are still in companys stock.

(3) Obligation as intended in paragraph (1) and (2) shall also be applicable for the company of which NIPER has been revoked, that has imported goods and/or material securing exemption Uncollected VAT and Sales Tax for Luxurious Goods but the export has not been realized.

Article 16

(1) The products made of imported Raw Material and/or products from Bonded Zone may be sold to DPIL after Export Realization and/or supply to Bonded Zone by company holder of NIPER, provided that:

• a. applying for BC 2.4 to the Customs Office supervising the applicant area;
• b. goods to sell to DPIL shall be maximum 25% (twenty five percent) of the Export Realization and/or supply to Bonded Zone;
• c. customs inspection shall be carried out by the Official;
• d. paying BM and/or Excise based on ready goods tariff and customs value based on Raw Material value on import plus 2% monthly interest commencing registration of PIB; and
• e. paying VAT and PPnBM based on tax charges amounting to the import value, plus fine in term of 2% monthly interest commencing import at the latest 24 (twenty four) months.

(2) Sales to DPIL should have been done within 12 (twelve) months commencing import until the sales of the goods to DPIL.

(3) Export Realization and/or supply to Bonded Zone as intended in paragraph (1) point b, commencing 1 August 2003.

(4) The procedures of sale of products to DPIL shall be as provided for in Attachment V hereto.

Article 17

(1) In case the sale of products to DPIL exceeds the provision as intended in Article 16 paragraph (1) point b, then the excess:

• a. shall be exposed to 100 % (one hundred percent) fine of the BM and/or Excise payable plus 2% monthly interest commencing registration of PIB;
• b. shall pay VAT and PPnBM in accordance with the value on import, plus 2% monthly fine commencing import at the latest 24 (twenty four) months.

(2) In case the sale to DPIL does not fulfill the provision as intended in Article 16 paragraph (2), as long as the products are in stock, the company shall be obliged:

• a. to pay BM and/or Excise based on ready goods tariff and customs value based on Raw Material value on import plus 2 % (two percent) monthly interest at the latest 24 months commencing registration of PIB;
• b. to pay VAT and PPnBM in accordance with the value on import, plus 2 % (two percent) monthly interest fine at the latest 24 months commencing the import.

Part Five
Sale to DPIL and Annihilation of By-Products, Production Leftover, Fault Products and Fault Raw Material and Completion of Imported Raw Material of which the export has not been completed

Article 18

The sale to DPIL of By-Products, Production Leftover, Fault Products and Fault Raw Material made of imported Raw Material and/or products from Bonded Zone may be carried out by the company provided that:

• a. applying for BC 2.4 to the Customs Office supervising the applicant area;
• b. customs inspection shall be carried out by the Official;
• c. paying 5 % BM of the sale price;
• d. paying Excise pursuant to the applicable tariff;
• e. paying VAT and PPnBM amounting to the import value; and
• f. payment of BM and/or Excise and VAT as well as PPnBM shall be made on the supply of goods to DPIL.

Article 19

(1) Annihilation of By-Products, Production Leftover, Fault Products and Fault Raw Material, from imported Raw Material and/or products from Bonded Zone may be carried out by company provided that:

• a. applying for BC 2.4 to Customs Office supervising applicants area;
• b. customs inspection is carried out by the Official;
• c. annihilation is supervised by the Official;
• d. uncollected BM and/or Excise and VAT and Uncollected Sales Tax for Luxurious Goods; and
• e. the result of annihilation shall be manifested in Minutes.

(2) Procedures of Sale to DPIL and annihilation of By-Products, Production Leftover, Fault Products and Fault Raw Material of imported Raw Material shall be provided for in Attachment VI hereto.

Article 20

(1) Imported Raw Material of which the export has not been done within period as intended in article 13 paragraph (3) may be completed provided that:

• a. the company shall apply for BC 2.4 to the Customs Office supervising the applicants area;
• b. customs inspection is carried out by the Official;
• c. the company shall pay BM and/or Excise in accordance with tariff on import plus 2% monthly interest as of the registration of PIB; and
• d. the company shall pay VAT and PPnBM amounting to the import value, plus 2 % (two percent) monthly fine interest.

(2) The procedures of completion of imported Raw Material of which the export has not been done shall be provided for in Attachment VII hereto.

Part Six
Imported Goods and/or Material Completion Report and Warranty Adjustment

Article 21

(1) The Company shall be obliged to deliver export report (LE) to the Regional Office at least once in every 6 (six) months using Imported Goods and/or Material Use Report form securing Exemption of BM and/or Excise Uncollected VAT and Sales Tax for Luxurious Goods (BCL.KT01).

(2) For company directly exporting its products, the BCL.KT01 shall be accompanied with:

• a. copy of PIB/PIBT/Stipulation of Census and Postal Consignment Taxation (PPKP);
• b. copy of Order of Clearance of Goods (SPPB);
• c. copy of STTJ;
• d. original of LPBC or LHP;
• e. copy of CK-8 document (specially for Excised Goods);
• f. copy of PEB securing export destination from the Official;
• g. copy of Bill of Lading (B/L) or Airway Bill (AWB) or other similar transportation documents; and
• h. disk of result of transfer of BCL.KT01 form.

(3) For company not directly exporting its products (mixed goods), the LE is submitted using BCL.KT01 form accompanied with:

• a. copy of PIB/PIBT/PPKP;
• b. copy of SPPB;
• c. copy of STTJ;
• d. original LPBC or LHP;
• e. copy of CK-8 document (specially for Excised Goods);
• f. copy of PEB securing export destination from the Official;
• g. copy of Bill of Lading (B/L) or Airway Bill (AWB) or other similar transportation documents;
• h. Certificate of Goods Delivery (SSTB); and
• i. disk of result of transfer of BCL.KT01 form.

(4) BCL.KT01 form as intended in paragraph (1), (2) and (3) shall be pursuant to the model in Attachment XII hereto.

Article 22

Company submitting its products to Bonded Zone for further process shall submit the report to the Regional Office at least every 6 (six) months using BCL.KT01 form accompanied with:

• a. copy of PIB/PIBT/PPKP;
• b. copy of SPPB;
• c. copy of STTJ;
• d. copy of CK-9 document (specially for Excised Goods);
• e. proof of contract of sales/title transfer to Company within Bonded Zone (PDKB);
• f. documents of goods delivery to Bonded Zone certified by the Official (BC 2.4); and
• g. disk of result of transfer of BCL.KT01 form.

Article 23

(1) Report as intended in Article 21 and 22 submitted by the company shall be approved if it satisfies the following requirements:

• a. submitted by the company importing goods and/or material and exporting its products or company supplying its products to Bonded Zone to be processed, assembled or installed on other goods;
• b. goods and/or material imported to be processed, assembled or installed on other goods as intended in point a has been exported or supplied to Bonded Zone;
• c. Export Realization should have been done within 12 (twelve) months commencing import date, except for company with production period more than 12 (twelve) months and securing exception from the Head of Regional Office on behalf of the Finance Minister;
• d. supply to Bonded Zone should have been done within 12 (twelve) months commencing registration of PIB until the supply of the goods to Bonded Zone;
• e. The report has been accompanied with required documents as intended in Article 21 and Article 22.

(2) Report as intended in Article 21 and 22 shall be declined in case it fails to satisfy requirements as intended in paragraph (1) and/or:

• a. The BM/Excise value and VAT/PPnBM of the Raw Material in the report is greater than the BM/Excise and VAT/PPnBM values in PIB;
• b. Warranty for imported goods and/or material based on PIB of the company concerned has been returned;
• c. Export is carried out first than import;
• d. The value of imported Raw Material of the goods exported or supplied to Bonded Zone is greater than the value of Raw Material on import;
• e. The report is not complete and/or not true covering:
• 1) Post of Tariff/HS in the report differs from the post of tariff/HS in LPBC/LHP;
• 2) Post of Tariff/HS in the report differs from the post of tariff/HS in PIB;
• 3) The quantity of exported goods in the report is greater than the quantity of exported goods in LPBC.

Article 24

(1) Product sales report to DPIL using BCL.KT01 form, accompanied with:

• a. copy of PIB/PIBT/PPKP securing SPPB/exit clearance from the Official;
• b. copy of STTJ;
• c. copy of BC 2.4;
• d. copy of SSPCP;
• e. invoice of sales to DPIL;
• f. sales contract; and
• g. disk of result of transfer of BCL.KT01 form.

(2) Report of Annihilation/Sales to DPIL of By-Products, Production Leftover, Fault Products, and Fault Raw Material shall use BCL.KT01 form accompanied with:

• a. copy of PIB/PIBT/PPKP securing SPPB/exit clearance from the Official;
• b. copy of STTJ;
• c. copy of BC 2.4;
• d. invoice of sales to DPIL and copy of SSPCP or Minutes of Annihilation; and
• e. disk of result of transfer of BCL.KT01 form.

(3) Report of completion of imported Raw Material of which the export has not been done shall use BCL.KT01 form accompanied with:

• a. copy of PIB/PIBT/PPKP securing SPPB/exit clearance from the Official;
• b. copy of STTJ;
• c. copy of BC 2.4;
• d. SSPCP; and
• e. disk of result of transfer of BCL.KT01 form.

Article 25

(1) Report as intended in Article 24 paragraph (1) submitted by the company shall be approved if it satisfies requirements as follows:

• a. applied for by company importing goods and/or material and exporting its products or supplying to Bonded Zone, selling its products to DPIL;
• b. sales as intended in point a, shall be carried out after Export Realization that should have been done within 12 (twelve) months commencing import date, except for the company with production period more than 12 (twelve) months and has secured exception from the Head of Regional Office on behalf of the Finance Minister;
• c. the report has been accompanied with required documents as intended in Article 24 paragraph (1).

(2) Report as intended in Article 24 paragraph (1) shall be declined in case it fails to satisfy requirements as intended in paragraph (1) and/or:

• a. BM/Excise and VAT/PPnBM value of Raw Material in the report is greater than the BM/Excise and VAT/PPnBM value in PIB;
• b. Warranty for imported goods and/or material based on PIB of the company concerned has been returned;
• c. Sale of products to DPIL is carried out first than export or supply to Bonded Zone;
• d. The value of imported Raw Material of the goods sold to DPIL is greater than the value of imported Raw Material of the goods exported or supplied to Bonded Zone;
• e. The value of imported Raw Material of goods sold to DPIL is greater than the value of Raw Material on import;
• f. The report is not complete and/or not true covering:
• 1) Post of Tariff/HS in the report differs from the post of tariff/HS in BC 2.4;
• 2) Post of Tariff/HS in the report differs from the post of tariff/HS in PIB;

Article 26

(1) Report as intended in Article 24 paragraph (2) submitted by the company shall be approved if it satisfies requirements as follows:

• a. applied for by company importing goods and/or material and selling and/or annihilating By-Products, Production Leftover, Fault Products, Fault Raw Material not exportable or cannot be supplied to Bonded Zone;
• b. Sales as intended in point a, shall be carried out within 12 (twelve) months commencing import date, except for company with production period more than 12 (twelve) months and has secured exception from the Head of Regional Office on behalf of the Finance Minister;
• c. the report has been accompanied with required documents as intended in Article 24 paragraph (2).

(2) Report as intended in Article 24 paragraph (2) shall be decline in case it fails to satisfy requirements as intended in paragraph (1) and/or:

• a. The value of BM/Excise and VAT/PPnBM of Raw Material in the report is greater than the value of BM/Excise and VAT/PPnBM in PIB;
• b. Warranty for imported goods and/or material based on PIB concerned has been returned;
• c. The value of the imported Raw Material of goods sold to DPIL and/or annihilated is much greater than the value of the Raw Material on import;
• d. The report is not complete and/or not true covering:
• 1) Post of Tariff/HS in the report differs from post of tariff/HS in BC 2.4;
• 2) Post of Tariff/HS in the report differs from post of tariff/HS in PIB.

Article 27

(1) Report as intended in Article 24 paragraph (3) submitted by the company shall be approved if it satisfies requirements as follows:

• a. it shall be proposed by company importing goods and/or material;
• b. completion of imported Raw Material of which the export has not been done has been carried out within 12 (twelve) months commencing registration of PIB, except for the company with production period more than 12 (twelve) months and has secured exception from the Head of Regional Office on behalf of the Finance Minister;
• c. the report has been accompanied with required documents as intended in Article 24 paragraph (3).

(2) Report as intended in Article 24 paragraph (3) shall be declined in case it fails to satisfy requirements as intended in paragraph (1) and/or:

• a. The value of BM/Excise and VAT/PPnBM of Raw Material in the report is greater than the value of BM/Excise and VAT/PPnBM in PIB;
• b. The report is not complete and/or not true covering:
• 1) Post of Tariff/HS in the report differs from post of tariff/HS in BC 2.4;
• 2) Post of Tariff/HS in the report differs from post of tariff/HS in PIB.

(3) The procedures of report inspection as intended in Article 21, 22, and 24 shall be provided for in Attachment VIII hereto.

Article 28

(1) In case the report as intended in Article 21, 22 and 24 is approved, the Head of Regional Office shall issue Warranty Adjustment Notice (SPPJ) indicating the amount of BM and/or Excise and VAT and PPnBM that has been accounted and/or remains to secure by the company.

(2) In case the amount of BM, Excise, VAT and PPnBM remains to secure, the company may replace the warranty it has deposited at least amounting to the warranty set forth in the SPPJ.

(3) Bank Guarantee or Customs Bond issued to replace the deposited warranty may be in form of Bank Guarantee or Customs Bond from the same or different guarantor.

(4) For BM, Excise, VAT and PPnBM that have been accounted, the warranty shall be returned at the latest 14 (fourteen) business days after the issuance of the latest SPPJ.

CHAPTER IV
REPAYMENT

Part One
Requirements for Securing Repayment

Article 29

Repayment may be granted to:

• 1. company exporting its products;
• 2. company supplying its products to Bonded Zone.

Article 30

In order to secure repayment as intended in Article 28 the producers shall be obliged to satisfy the following requirements:

• 1. In case of exported goods:
• a. PEB KITE has been proposed to the Customs Office;
• b. Physical inspection for the exported goods has been carried out by the Official;
• c. Date of B/L or AWB or other similar transportation documents, do not exceed 12 (twelve) months until receipt of application by the Directorate General;
• d. Date and number of PIB Registration shall be at the latest 24 (twenty four) months prior to shipping of the exported goods.
• 2. In case goods supplied to Bonded Zone:
• a. BC 2.4 has been proposed to the Customs Office;
• b. physical inspection has been carried out by the Official;
• c. date of Official inspection note does not exceed 12 (twelve) months until the receipt of application by the Directorate General;
• d. Date and number of PIB Registration shall be at the latest 24 (twenty four) months prior to supply to Bonded Zone.

Part Two
Clearance of Imported Goods and/or Raw Material from Customs Area and Supply from Bonded Zone

Article 31

(1) Clearance of imported goods and/or Raw Material from Customs Area, to request repayment shall be carried out using Goods Importation Notification (PIB).

(2) PIB as intended in paragraph (1) shall be proposed by the Company holder of NIPER processing goods from imported Raw Material on its own.

(3) Application for PIB shall be accompanied with SSPCP for payment of Import Duty and/or Excise and VAT, PPnBM and PPH.

(4) Procedures of clearance of imported import shall be carried out pursuant to Decision of Director General on Directives for Implementation of Customs Management in Import Field.

Article 32

(1) Supply of products from Bonded Zone to be processed, assembled, or installed on other goods paying BM and/or Excise and VAT and PPnBM, to request for repayment shall be carried out under provisions:

• a. The entrepreneur shall propose Notification of Goods Clearance from Bonded Zone Destination DPIL (BC 2.5) accompanied with SSPCP for BM and/or Excise and VAT and PPnBM to the Customs Office supervising the Bonded Zone;
• b. customs inspection shall be carried out by the Official.

(2) BC 2.5 as intended in paragraph (1) point a is made by the Bonded Zone entrepreneur.

(3) Procedures of supply from Bonded Zone shall be provided for in Attachment IX hereto.

Part Three
Export Realization and Supply to Bonded Zone

Article 33

(1) Export of products made of imported goods and/or material and/or products from Bonded Zone to request Repayment shall be carried out using Goods Export Notification (PEB) securing KITE.

(2) PEB as intended paragraph (1) shall be proposed by:

• a. Company exporting the products on its own; or
• b. Other Company either holder of NIPER or non holder of NIPER, whose goods are mixed with the products of company as intended in point a.

(3) Export of products should have been done within 24 months commencing date of PIB registration or date of BC 2.5 registration.

(4) For PEB of goods on which physical inspection has been carried out and the goods have been exported, Customs Office shall issue LPBC/ LHP.

(5) Procedures of application for PEB securing KITE shall be carried out pursuant to the Decision of Director General on Directives for Implementation of Customs Management in Export Field for Exported Goods Securing Import Facilities for Export Destination.

Article 34

(1) Products made of imported Raw Material may be supplied by company holder of NIPER to Bonded Zone to be processed further, provided that:

• a. proposing BC 2.4 to the Customs Office supervising the applicants area;
• b. customs inspection shall be carried out by the Official.

(2) Supply of products to Bonded Zone should have been done within 24 months commencing date of PIB registration or date of BC 2.5 registration.

(3) Procedures of supply of products to Bonded Zone shall be provided for in Attachment IV hereto.

Part Four
Repayment Application

Article 35

(1) Repayment application may be proposed to the Head of Regional Office by enclosing:

• a. Report on Usage of Imported Goods and/or Material Applying for Repayment (BCL.KT02); and
• b. SSB.

(2) In addition to attachments as intended in paragraph (1):

• a. In case of exported goods by enclosing:
• 1. import documents or documents of supply from Bonded Zone in term of:
• a) copy of PIB/ PIBT/ BC 2.5/ PPKP securing SPPB/ SPPB-KB/ clearance approval from Official;
• b) Third original copy of SSBC / SSPCP.
• 2. export documents in term of:
• a) copy of PEB securing export destination from the;
• b) original LPBC/ LHP;
• c) copy of B/L or AWB or other similar transportation document.
• b. In case of goods supplied to Bonded Zone by enclosing:
• 1. import documents or documents of supply from Bonded Zone in term of:
• a) copy of PIB/ PIBT/ PPKP securing SPPB/ clearance approval from the Official;
• b) Third original copy of SSBC / SSPCP;
• 2. documents of supply to Bonded Zone in term of:
• a) BC 2.4;
• b) Copy of Invoice and copy of tax invoice;
• c) SPPB-KB;
• d) Purchase Order;
• e) Copy of selling contracts to Bonded Zone.

Article 36

(1) Application for repayment of BM and/or Excise shall be processed to be approved or declined within 14 (fourteen) business days commencing receipt of complete and true application.

(2) Procedures of awarding repayment of BM and/or Excise shall be provided for in attachment X hereof.

CHAPTER V
SUPERVISION

Article 37

Company securing Exemption and/or Repayment and Uncollected VAT and Sales Tax for Luxurious Goods shall be obliged to keep and maintain documents, books, records and letters in relation with awarding of Exemption and/or Repayment for it during 10 (ten) years in its premise in Indonesia.

Article 38

(1) Supervision of Regional Office of awarding of Exemption and/or Repayment and Uncollected VAT and Sales Tax for Luxurious Goods shall be carried out through:

• a. electronic data process;
• b. company data;
• c. supervision of goods physical and/or audit.

(2) Supervision through electronic data process shall use data of Decision of Exemption and/or repayment and Uncollected VAT and Sales Tax for Luxurious Goods and STTJ as well as data of PIB, BC 2.5, PEB and BC 2.4 issued by relevant Customs Office.

(3) Inspection of company data shall be carried out periodically and in case the result of the inspection does not fit the DIPER, the Head of Regional Office may decide customs audit.

(4) Supervision of goods physical and/or audit in the area of customs and excise may be carried out at any time pursuant to the prevailing provisions.

CHAPTER VI
MISCELLANEOUS PROVISIONS

Article 39

(1) Companies affiliated to a group of companies may secure Exemption and/or Repayment provided that:

• a. they secure group NIPER;
• b. application for warranty and reporting shall be carried out by the appointed company;
• c. VAT and PPnBM shall be collected pursuant to the prevailing taxation provisions.

(2) In order to implement the provision as intended in paragraph (1) point a, when applying for DIPER, it shall:

• a. mention companys registration number including Tax Payer Number (NPWP), name, address and status of the company (as importer, exporter, processor or appointed to submit warranty, report or apply for repayment);
• b. enclose notary deed.

Article 40

Company that does not perform the overall production process by itself and gives subcontract to other company may secure Exemption and/or Repayment provided that:

• 1. the subcontracted works shall be based on work contract; and
• 2. the awarding of works from the company to the subcontractor company shall first obtain approval from the Head of Regional Office.
• 3. VAT and PPnBM shall be collected pursuant to the prevailing taxation provisions.

Article 41

(1) For material and/or goods of which the Raw Material securing Exemption and Uncollected VAT and Sales Tax for Luxury Goods that should be exported or that should be available with the company if not accountable, receiver of Exemption and Uncollected VAT and Sales Tax for Luxurious Goods shall be obliged:

• a. to pay outstanding BM and/or Excise plus fine amounting to 100 % (one hundred percent) of BM and/or Excise payable;
• b. to pay VAT and PPnBM previously not collected plus fine pursuant to the prevailing taxation provisions.

(2) Procedures of payment of BM and/or Excise, fine, and interests as well as payment of VAT and PPnBM and interests, as intended in paragraph (1) shall be made pursuant to the prevailing provisions.

Article 42

(1) For exported goods once secured Exemption and/or Repayment and Uncollected VAT and Sales Tax for Luxury Goods re-imported, during the import, the company shall:

• a. apply for PIB;
• b. be obliged to submit warranty amounting to BM and/or Excise at the price and tariff of ready goods along with export proofs in term of copy of PEB and copy of LPBC/LHP legalized by the Official to the Head of Customs and Excise Service Office where import takes place; and
• c. be obliged to pay VAT and PPnBM pursuant to the prevailing provisions.

(3) Exported goods as intended in paragraph (1) shall undergo customs inspection.

(4) For reimported exported goods as intended in paragraph (1) not reexported within 6 (six) months, the warranty amounting to BM and/or Excise as intended in paragraph (1) point b shall be cleared.

Article 43

(1) For products supplied to Bonded Zone once secured Exemption and Uncollected VAT and Sales Tax for Luxury Goods repaid, during the import:

• a. The Company shall receive BC 2.5 from the Bonded Zone entrepreneur;
• b. The Company shall be obliged to submit to the Customs Office, BC 2.5 along with warranty amounting to BM and/or Excise at the price and tariff of ready goods accompanied with proofs of supply to Bonded Zone in term of copy of BC 2.4 legalized by the Official to the Head of Customs Office;
• c. The company shall be obliged to pay VAT and PPnBM pursuant to the prevailing provision.

(2) Products as intended in paragraph (1) shall undergo customs inspection.

(3) Products resupplied from Bonded Zone as intended in paragraph (1) that cannot be resupplied to Bonded Zone within 6 (six) months, the warranty amounting to BM and/or Excise as intended in paragraph (1) shall be cleared.

(4) The procedures of resupplying products supplied to Bonded Zone once secured Exemption and Uncollected VAT and Sales Tax for Luxury Goods shall be provided for in Attachment XI hereto.

Article 44

(1) If the result of audit indicates over Exemption, then for such excess receiver of Exemption and Uncollected VAT and Sales Tax for Luxury Goods shall be obliged:

• a. to pay outstanding BM and/or Excise plus fine amounting to 100 % (one hundred percent) of BM and/or Excise payable plus interest for the over Exemption amounting to 2 % (two percent) every month maximum 24 (twenty four) months commencing the date of PIB;
• b. to pay VAT and PPnBM previously not collected plus fine pursuant to the prevailing taxation provisions.

(2) If the result of audit indicates over Repayment, then for such excess shall be returned and exposed to fine amounting to 100% (one hundred percent) plus interest for over Repayment amounting to 2 % (two percent) every month maximum 24 (twenty four) months commencing the date of SPMK.

(3) For over exemption as intended in paragraph (1), if it can prove export within 12 months commencing import date, shall be released from BM and/or Excise, fine and interest.

Article 45

(1) The amount of fine in term of interest payable as intended in:

• a. Article 16 paragraph (1) point e;
• b. Article 17 paragraph (1) point b and paragraph (2) point b;
• c. Article 20 paragraph (1) point d;
• d. Article 41 paragraph (1) point b;
• e. Article 44 paragraph (1) point b.

shall be stipulated by the Director General of Tax.

(2) For the purpose of establishing sanction in term of interest as intended in paragraph (1) point a, b, c and point d the Head of Customs Office shall send BC 2.4 approved by the Official for settlement of sanction in term of VAT and PPnBM interest to the Director General of Tax, in this case, Head of Tax Service Office where company is registered as Tax Payer Entrepreneur.

(3) For the purpose of establishing sanction in term of interest as intended in paragraph (1) point e, the Head of Customs Office shall send SPKPBM document to the Director General of Tax, in this case, the Head of Tax Service Office where company is registered as Tax Payer Entrepreneur.

CHAPTER VII
TRANSITIONAL PROVISION

Article 46

(1) All prevailing decisions of Exemption and/or Repayment and Uncollected VAT and Sales Tax for Luxury Goods issued by the Head of Bapeksta Keuangan/Head BINTEK Keuangan or appointed Official shall remains in full effects and power until the expiration of the decisions concerned.

(2) For application for DIPER after 1 January 2004, the Company shall propose to the Regional Office

CHAPTER VIII
CLOSING REGULATION

Article 47

This Decision of Director General shall be in effect as of 1 January 2004.

For public cognizance, This Decision of Director General should be announced by entering it in the Statute Book of Republic of Indonesia.

Stipulated in Jakarta
Dated 31 December 2003
DIRECTOR GENERAL
Signed
EDDY ABDURRACHMAN
NIP 060044459
Secretary to the Directorate General
for Head of Organization and Management Division
MAIMUN
NIP 060040158

Attachment to DECISION OF DIRECTOR GENERAL OF CUSTOMS AND EXCISE
No. KEP-205/BC/2003

Attachment (Indonesian)