to Indonesian

DECREE OF THE MINISTER OF INDUSTRY AND TRADE
NO. 647/MPP/Kep/10/2004

CONCERNING
PRECURSOR IMPORT PROVISIONS

THE MINISTER OF INDUSTRY AND TRADE,

Attachment

Considering:

• a. that precursor not only benefits in the therapy and medical service field but also can be misused in the production of narcotics and psychotropic inflicting losses on human life and health of Indonesian people thus eventually being able to threaten national resilience;
• b. that besides benefiting in the therapy and medical service field, precursor also can be used as raw material/auxiliary material needed in the production of other industries;
• c. that in connection with matters in letters a and b and in a bid to prevent misuse, facilitate supervision over the import as well as guarantee the procurement of precursor as raw material/auxiliary material for industries from ocher countries, it is deemed necessary to regulate the import of precursor;
• d. that in relation thereto, it is necessary to issue a decree of the Minister of Industry and Trade;

In view of:

• 1. Trade Ordinance of 1934 (Statute Book of 1938 Pie. 86);
• 2. Law No. 3/1982 on corporate registry number (Statute Book of 1982 No. 7, Supplement to Statute Book No. 3214);
• 3. Law No. 5/1984 on industry (Statute Book of 1984 No. 22, Supplement to Statute Book No. 3274);
• 4. Law No. 23/1992 on health (Statute Book of 1992 No. 100, Supplement to Statute Book No. 3495);
• 5. Law No. 7/1994 on ratification of the agreement establishing the World Trade Organization (Statute Book of 1994 No. 57, Supplement to Statute Book No. 3564);
• 6. Law No. 10/1995 on customs affairs (Statute Book of 1995 No. 75, Supplement to Statute Book No. 3612);
• 7. Law No. 8/1996 on ratification of convention on psychotropic substances 1971 (Statute Book of 1996 No. 100, Supplement to Statute Book No. 3657);
• 8. Law No. 5/1997 on psychotropic (Statute Book of 1997 No. 10, Supplement to Statute Book No. 3671);
• 9. Law No. 7/1997 on ratification of the United Nations Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic substances 1998 (Statute Book of 1997 No. 17, Supplement to Statute Book No. 3673);
• 10. Law No. 22/1997 on narcotics (Statute Book of 1997 No. 67, Supplement to Statute Book No. 3698);
• 11. Law No. 8/1999 on consumer protection (Statute Book of 1999 No. 42, Supplement to Statute Book No. 3821);
• 12. Presidential Decree No. 260/1967 on affirmation of tasks and responsibility of the Minister of Trade in the foreign trade sector;
• 13. Presidential Decree No. 228/M/2001 on the establishment of the Mutual Cooperation Cabinet;
• 14. Presidential Decree No. 102/2001 on the status, tasks, functions, authority, organizational structures and working arrangements of ministries;
• 15. Presidential Decree No. 109/2001 on first-echelon organizational units and tasks of ministries;
• 16. Presidential Decree No. 17/2002 on the National Narcotics Board;
• 17. Regulation of the Minister of Health No. 472/Menkes/Per/V/1996 on security of dangerous substances for health;
• 18. Decree of the Minister of Industry and Trade No. 229/MPP/Kep/7/1997 or, import general provisions;
• 19. Decree of the Minister of Industry and Trade No. 230/MPP/Kep/7/1997 on goods subjected to import control as already amended several times and the latest by Decree of the Minister of Industry and Trade No. 406/MPP/Kep/6/2004;
• 20. Regulation of the Minister of Health No. 688/Menkes/Per/VII/1997 on psychotropic distribution;
• 21. Regulation of the Minister of Health No. 785/Menkes/Per/VII/1997 on the export and import of psychotropic;
• 22. Decree of the Minister of Health No. 917/MENKES/SK/VIII/1997 on kinds of psychotropic precursors;
• 23. Decree of the Minister of Health No. 890/MENKES/SK/1998 on kinds of narcotic precursor;
• 24. Decree of the Minister of Industry and Trade No. 86/MPP/Kep/3/2001 on the organization and working arrangement of the Ministry of Industry and Trade;
• 25. Decree of the Minister of Industry and Trade No. 40/ MPP/Kep/1/2003 on importer identity number (API);

Observing:

Presidential Instruction No. 3/2002 on efforts to overcome misuse and illegal distribution of narcotics, psychotropic, precursor and other additives;

DECIDES:

To stipulate:

THE DECREE OF THE MINISTER OF INDUSTRY AND TRADE ON PRECURSOR IMPORT PROVISION

Article 1

Referred to in this decree as:

• 1. Precursor shall be certain substance or original substance or chemical substance which can be used as raw material/auxiliary material for the need of production in industries and if it is misused, it can be used in producing narcotics and/or psychotropic substances.
• 2. Producer Importer of Precursor, hereinafter called IP-Precursor shall be a company having pharmaceutical industry or other industry which uses precursor as raw material or auxiliary material of production that secures recognition to import precursor directly.
• 3. Registered Importer of Precursor, hereinafter called IT-Precursor shall be a company undertaking the trade of precursor, which secures the appointment to import precursor for distribution to pharmaceutical industry or other industries as end-user of precursor.
• 4. Recommendation shall be a letter issued by official of institution/unit concerned, which is authorized to give explanation technically and is not import license/approval.
• 5. Minister shall be the Minister of Industry and Trade.
• 6. Dirjen DAGLU shall be the Director General of Foreign Trade, Ministry of Industry and Trade.
• 7. Dirjen IKAH shall be the Director General of Chemical, Agro and Forest Product Industries, Ministry of Industry and Trade.
• 8. Chairman of BIN shall be the Chairman of the National Narcotics Agency established on the basis of Presidential Decree No. 17/2002.
• 9. Kabareskrim POLRI shall be the Head of the Detective and Criminal Affairs Board, Indonesian Police.

Article 2

(1) Kinds of precursor as meant in Article 1 point 1 shall be contained in Attachment I to this decree.

(2) The precursor as meant in paragraph (1) only can be imported by companies already securing recognition as IP-Precursor or appointment as IT-Precursor.

(3) The procedures for importing precursor as meant in paragraph (1) used for the need of pharmaceutical industries shall be stipulated separately by the Minister of Health.

Article 3

(1) Recognition as IP-Precursor as meant in Article 2 paragraph (2) shall be stipulated by Dirjen DAGLU.

(2) In order to secure recognition as IP-Precursor as meant in paragraph (1), companies shall submit written application to Dirjen DAGLU by enclosing the following documents:

• a. copy of Industrial Business License (IUI), Industrial Registry Number (TDI) or other equivalent business license from the authorized institution;
• b. copy of Producer Importer’s Identity Number (API-P) or Limited Importer’s Identity Number (API-T);
• c. copy of Corporate Registry Number (TDP);
• d. copy of Taxpayer Code Number (NPWP);
• e. production plan; and
• f. recommendation from Dirjen IKAH.

(3) Based on the written applications of the companies as meant in paragraph (2), Dirjen DAGLU issues approval or rejection of recognition as [P-Precursor not later than 15 (fifteen) working days as from the date of receipt of applications.

(4) The model of document of recognition as IP-Precursor shall be as contained in Attachment II to this decree.

Article 4

(1) The recognition as IP-Precursor as meant in Article 3 shall cover the validity period of recognition of IP Precursor, country of origin, destination port, quantity and kinds of precursor which can be imported.

(2) IP-Precursor as meant in paragraph (1) shall be issued by observing capacity and production plan for one year.

(3) Companies already securing recognition as IP-Precursor only can import precursor solely for the need of production of their industries and shall be prohibited from trading and/or transferring the imported precursor.

Article 5

(1) Recognition as IP-Precursor as meant in Article 3 shall be effective for one year at the maximum and can be extended.

(2) Recognition as IP-Precursor as meant in paragraph (1) shall be declared null and void unless it is extended.

Article 6

(1) Companies already securing recognition as IP-Precursor shall submit written report to Dirjen DAGLU in this case the Director of Import, Ministry of Industry and Trade every month on the realization of the import and use of precursor not later than the 15th of the ensuing month with a copy made available to Dirjen IKAH, Head of BNN and Kabareskrim POLRI.

(2) The model of the written report of companies already securing recognition as IP-Precursor shall be as contained in Attachment III to this decree.

Article 7

(1) The appointment as IT-Precursor as meant in Article 2 paragraph (2) shall be stipulated by Dirjen DAGI-U.

(2) In order to secure recognition as IT-Precursor as meant in paragraph (1), companies shall submit written application to Dirjen DAGLU by enclosing the following documents:

• a. copy of Trading Business License (SIUP) or other equivalent business license from the authorized institution;
• b. copy of General Importer Identity Number (APIU);
• c. copy of Corporate Registry Number ( FDP);
• d. copy of Taxpayer Code Number (NPWP);
• e. copy of Import Declaration (PIB) showing experience in the import of precursor for 3 (three) years);
• f. recommendation from Kabareskrim POLRI and Cl:eirman of BNN:
• g. plan for distribution to industrial end-users.

(3) Based on the written applications of the companies as meant in paragraph (2), Dirjen DAGLU issues approval or rejection of recognition as IT-Precursor riot later than 15 (fifteen) working days as from the date of receipt of applications.

(4) The model of document of recognition as IP-Precursor shall be as contained in Attachment IV to this decree.

Article 8

(1) The appointment as IT-Precursor as meant in Article 7 shall be effective for 3 (three) years at the maximum and can be extended.

(2) The appointment as IT-Precursor as meant in paragraph (1) shall be declared null and void unless it is extended.

Article 9

(1) Companies already securing the appointment as IT Precursor only can import precursor to be distributed directly, without middlemen, to industrial end-users.

(2) Industrial end-users obtaining precursor from IT-Precursors as meant in paragraph (1) only shall use the precursor as raw material/auxiliary material of their production and be prohibited from trading and/or transferring it to other parties.

Article 10

(1) Upon importing precursor, IT-Precursor shall secure import approval first from Dirjen DAGLU, which covers the validity period of import approval, quantity and kinds of precursors, name of exporter, country of origin and destination port.

(2) The import approval as meant in paragraph (1) shall be stipulated by Dirjen DAGLU on the basis of recommendation of Kabareskrim POLRI and Head of BNN.

(3) The model of document of import approval of precursor shall be as contained in Attachment V to this decree.

Article 11

(1) Companies already securing appointment as IT-Precursor shall submit written report to Dirjen DAGLU in this case the Director of Import, Ministry of Industry and Trade every month on the realization of the import and distribution of precursor not later than the 15th of the ensuing month with a copy made available to Dirjen IKAH, Head of the Food and Drug Supervisory Board, Head of BNN and Kabareskrim POLRI.

(2) The model of the written report of companies already securing appointment as IT-Precursor shall be as contained in Attachment VI to this decree.

Article 12

(1) The import of precursor by IP-Precursor and IT-Precursor as meant in Article 2 paragraphs (7) and (3) shall be subjected first to verification or technical surveillance in countries where the goods are loaded.

(2) The verification or technical surveillance as meant in paragraph (1) shall be done surveyors appointed by the minister, covering examination of name and ad dress of exporter, producing country, classification and HS Number, kinds and technical specifications, chemical composition of precursor and quantity of precursor to be imported.

(3) Results of the verification or technical surveillance already executed by the surveyors as meant in paragraph (2) shall be issued in the form of Surveyor Report (LS) which is used as import document.

(4) In connection with the verification or technical surveillance of the import of precursor, surveyors can collect compensation for service they render from IP Precursor or IT-Precursor.

(5) In order to secure the appointment as executors of verification or technical surveillance of the import of precursor as meant in paragraph (2), surveyors shall meet the following requirements:

• a. experiencing as surveyor for 5 (five) years at the minimum; and
• b. having branch or representative or affiliate abroad.

(6) The exception from the compulsory verification or technical surveillance of the import of precursor for the need of technology research and development and other purposes only can be granted by the minister or the appointed official on the basis of written consideration from the Head of BNN.

(7) Technical provisions and procedures for the verification or technical surveillance of the import of precursor shall be stipulated by Dirjen DAGtU.

Article 13

The verification or technical surveillance of the import of precursor by the surveyors as meant in Article 12 shall not reduce the authority of the Directorate General of Customs and Excise to undertake customs inspection.

Article 14

Companies already securing:

• a. recognition as IP-Precursor
• b. appointment as IT-Precursor and/or
• c. approval of the import of precursor shall be prohibited from transferring or changing name of IP-Precursor or IT-Precursor and/or import approval of precursor to other parties.

Article 15

The exception from the provisions in this decree only can be stipulated by the minister.

Article 16

Technical provisions and matters not yet regulated in this decree, shall be stipulated by Dirjen DAGLU.

Article 17

(1) Violation of the provisions in this decree, intentionally or due to negligence, shall be subjected to sanctions in the form of:

• a. revocation of recognition as IP-Precursor in the case of:
• 1) kind or quantity of the imported precursor being not suitable to what is mentioned in document of recognition of IP-Precursor;
• 2) the imported precursor being traded or transferred;
• 3) the realization of the import and the use being not reported twice in three months; or
• 4) evidence of violation and/or the alleged crime related to misuse of recognition as IP-Precursor being sufficient or the court declaring the relevant guilty for violation and crime related to the misuse of narcotics and/or psychotropic substances that utilize the imported precursors.
• b. revocation of appointment as IT-Precursor in the case of:
• 1) kind or quantity of the imported precursor being not suitable to what is mentioned in document of recognition of IP-Precursor;
• 2) the realization of the import and the distribution being not reported twice in three months; or
• 3) evidence of violation and/or the alleged crime related to misuse of appointment as IT-Precursor being sufficient or the court declaring the relevant guilty for violation and crime related to the misuse of narcotics and/or psychotropic substances that utilize the imported precursors.

(2) The revocation of recognition as IP-Precursor and IT Precursor as meant in paragraph (1) shall be done by Dirjen DAGLU.

(3) As a consequence of the revocation of recognition as IP-Precursor as meant in paragraph (1) letter a, the relevant companies only can submit again applications for securing recognition as IP-Precursor after obtaining written consideration from Dirjen IKAH and Kabareskrim POLRI.

(4) The imposition of sanction of revocation as meant in paragraph (1) shall not reduce the imposed of criminal sanction on the basis of the law in force.

Article 18

The imported precursors not suitable to the provisions in this decree shall be destroyed or re-exported in accordance with the provisions of the law in force.

Article 19

The decree shall come into force one month after the date of stipulation.

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

Stipulated in Jakarta
On October 18, 2004
THE MINISTER OF INDUSTRY AND TRADE
sgd
RINI M SUMARNO SOEWANDI

Attachment of DECREE OF THE MINISTER OF INDUSTRY AND TRADE
No. 647/MPP/Kep/10/2004
Date : October 18, 2004