THE REGULATION OF THE MINISTER OF FINANCE
No. 79/PMK.010/2006

CONCERNING
EXEMPTION OF IMPORT DUTY ON IMPORT OF MOTOR VEHICLE PARTS AND
ACCESSORIES FOR PRODUCTION OF MOTOR VEHICLES FOR EXPORT

THE MINISTER OF FINANCE,

Considering :

• a. that, in the framework of enhancing of investment especially in export - oriented motor vehicle industries, it is deemed necessary to grant exemption of import duty on import of motor vehicle parts and accessories for production of motor vehicles for export;
• b. that, based on the matters, as meant in paragraph a, it is necessary to stipulate Regulation of the Minister of Finance on Exemption of Import Duty on Import of Motor Vehicle parts and Accessories for Production of Motor Vehicles for Export;

Referring to :

• 1. Law No. 10/1995 on Customs;
• 2. Presidential Decree No. 20/P/2004;
• 3. Decree of the Minister of Finance No. 585/KMK.05/1996 on use of Bank Guarantee to Guarantee Payment of Import Duty Excise Duty, Monetary charges, and Taxes in the Framework of Import as already amended by Decree of the Minister of Finance No. 209/KMK.01/1999;
• 4. Decree of the Minister of Finance No. 475/KMK.05/1997 on use of Cash Guarantee to Guarantee Payment of Import Duty, Excise Duty, Monetary charges, and Taxes in The Framework Of Import;
• 5. Decree of the Minister of Finance No. 461/KMK.05/1997 on use of Custom Bond To Guarantee Payment of Import Duty, Excise Duty?, Monetary Charges, and Taxes In The Framework of Import as already amended by Decree of the Minister of Finance No. 208/KMK.01/1999;
• 6. Decree of the Minister of Finance No. 441/KMK.05/1999 on use of Written Guarantee To Guarantee Payment of Import Duty, Excise Duty, Monetary Charges, and Taxes In the Framework of Import as already amended by Regulation of the Minister of Finance No. 25/PMK.04/2005;
• 7. Decree of the Minister of Finance No. 545/KMK.01/2003 on Stipulation of System of classification Of Import Goods ;
• 8. Degree of the Minister of Finance No. 547/KMK.01/2003 on Stipulation of Tariff of Import Duty on Import Goods;

DECIDES:

To Stipulate :

REGULATION OF THE MINISTER OF FINANCE ON EXEMPTION OF IMPORT DUTY ON IMPORT OF MOTOR VEHICLE PARTS AND ACCESSORIES FOR PRODUCTION OF MOTOR VEHICLES FOR EXPORT.

Article 1

Import of motor vehicle parts and accessories for production of motor vehicles for export is given exemption of import duty so that final tariff of import duty becomes zero percent (o%).

Article 2

(1) Exemption of import duty, as meant Article l, is given only to companies that imported Motor vehicle parts and accessories for production of motor vehicles in Completely Built up (CBU) condition and motor vehicle, in completely Knocked Down (CKD) condition for Export by the concerned importers.

(2) Motor Vehicle in CKD condition, as meant in paragraph (1), must be exported in one single unit.

(3) For identification of motor vehicle parts and accessories exempted from import duty, conversion of parts and accessories of motor vehicles in CBU and CKD condition, as meant in paragraph (1), is stipulated by an independent surveyor.

Article 3

(1) Application for exemption of import duty, as meant in Article l, is filed to the Director General of customs and Excise.

(2) The Application as meant in paragraph (1), must be completed with

• a. Import Plan (RIB) to be requested for exemption of import duty;
• b. Conversion table, as meant in Article 2 paragraph (3) ;
• c. Plan of Motor Vehicle for a period of twelve (12) months containing information regarding quantity, type, mark, technical specification, and export destination country;
• d. Information regarding installed capacity Of the motor vehicle manufacturing/assembling company;
• e. Export/sale-purchase contract with overseas buyer;
• f. Contract between importer of motor vehicle parts and accessories and motor vehicle manufacturing/ assembling company, except for producers-exporters;
• g. Guarantee from director of the applying company.

Article 4

The Director general of Customs and Excise on behalf of the Minister of Finance issues Decree of the Minister of Finance on exemption of import duty on import of motor vehicle parts and accessories, as meant in Article l.

Article 5

(1) Application for exemption of import duty is filed one Time for each type of motor vehicle in accordance with Export Plan, as meant in Article 3 paragraph (2) clause c.

(2) Exemption of import duty is given for a period until the end of validity of this Regulation and may not be extended.

(3) Motor Vehicles, which components receive exemption of import duty, as meant in Article 4, must all be exported be fore the end of the validity of this Regulation.

(4) Exemption of import duty is not applicable for motor vehicle imported to the Bonded Zone or Bonded Zone of Batam Island

Article 6

(1) Motor vehicle parts and accessories imported, which receive exemption of import duty and their export is not yet realized after the period, as meant in Article 5 paragraph (2), are subject to import duty additional interest in accordance with applicable regulations.

(2) Import goods, which are not in accordance with port Plan, as meant in Article 3 paragraph (2) clause a, are subject to import duty and other import charge pursuant to applicable regulations.

Article 7

The applicant must convey to the Directorate General of Customs and Excise:

• a. Report on realization of export of motor vehicles, which parts and accessories imported receive exemption of import duty regularly (once in every three months) since date of Decree of the Minister of Finance, as meant in Article 4;
• b. Final report on realization of export of motor vehicles, which parts and accessories imported receive exemption on of import duty with in not later than fourteen (4) days after the end of validity of this Regulation or after export of motor vehicles is fully realized.

Article 8

Exemption of import duty, as meant in Article 4, is invalidated if with six (6) months since date of Decree of the Minister of Finance on Exemption of Import Duty, the application not yet realize import of motor vehicle parts and accessories.

Article 9

The Director General of Customs and Excise is instructed to implement the provisions of this Regulation.

Article 10

This Regulation is valid twelve (12) months since August 26, 2006.

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

Stipulated in : JAKARTA
Dated : September 25, 2006

THE MINISTER OF FINANCE
(signature)
SRI MULYATI INDRAWATI