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Part 7: New Provisions On Import And Export Of Consignment Goods

By : Riza Buditomo; Rinaldi Raymond; Reza Fahlevi

28-Nov-2023

Download: New Provisions on Import and Export of Consignment Goods

I. In Brief
The Minister of Finance (“MOF”) has issued Regulation No. 96 of 2023 on Customs, Excise and Tax Provisions on the Import and Export of Consignment Goods (“MOF Reg. 96”) which amended by MOF Regulation No. 111 of 2023 (“MOF Reg. 111”). Please note that MOF Regulation 96 revokes MOF Regulation No. 199/PMK.010/2019 of 2019 on Customs, Excise and Tax Provisions on the Import of Consignment Goods (“MOF Reg. 199”).
The issuance of MOF Reg. 96 is driven by the rapid growth of the import consignment goods shipping business through postal services, which needs to be complemented by more advanced service procedures and supervision utilizing information technology. Furthermore, MOF Reg. 96 also clarifies provisions concerning the export of consignment goods, which were not previously regulated in MOF Reg. 199.

II. Key Issues
In general, consignment goods refer to goods sent through postal operators. MOF Reg. 96 specifies the types and criteria of consignment goods, which were not previously detailed in MOF Reg. 199. We set out below the key takeaways from MOF Reg. 96:

(i). PPMSE as the Importer of Consignment Goods
Previously, under MOF Reg. 199, PPMSE only acted as a partner of Directorate General of Customs and Excise (Direktorat Jenderal Bea dan Cukai or "DJBC"). However, in MOF Reg. 96, PPMSE is treated as the importer. MOF Reg. 96 stipulates that if consignment goods are from trade transactions through (Penyelenggara Perdagangan Melalui Sistem Elektronik or “PPMSE”), the entity to be treated as the importer is as follows:

a. PPMSE located within the customs area; or
b. business entity located within the customs area that has been designated as a representative of PPMSE located outside the customs area.

By acting as the importer, PPMSE becomes responsible for importer obligations, such as paying customs duties, excise taxes, administrative sanctions in the form of fines, and/or taxes related to imports. This provision clarifies who is responsible for the importation of consignment goods.

(ii). PPMSE's Obligation to Partner with DJBC
Previously, under MOF 199, it was stipulated that PPMSE could form partnerships with DJBC. In MOF Reg. 96, this partnership scheme is mandatory. This also affects the customs notification system and the determination of the customs value, which was previously an official assessment in MOF Reg. 199 but is now a self-assessment under MOF Reg. 96.
The partnership between PPMSE and DJBC takes the following forms:

a. Exchange of electronic catalog data(e-catalog) and electronic invoices (e-invoice) for consignment goods processed through PPMSE.
b. Other forms of partnership that enhance the services and supervision conducted by the Directorate General of Customs and Excise

Please note that there is an exemption from the mandatory partnership with DJBC for e-commerce operators that have fewer than 1,000 shipments in a calendar year.

(iii). Addition of Commodities Subject to Most Favoured Nation (MFN) Tariffs
MOF Reg. 96 specifies that consignment goods imported for personal use, as declared with a consignment note, with a customs value ranging from FOB USD 3 to FOB USD 1500 per
recipient per shipment, will be subject to a 7.5% customs duty and exempt from income tax collection. However, there are certain types of goods excluded from this provision, and they are subject to the MFN tariff.
MOF Reg. 96 increases the number of goods subject to MFN tariffs, which previously consisted of 4 items and now includes 8 items, as follows:

Please note that there is an exemption from the mandatory partnership with DJBC for e-commerce operators that have fewer than 1,000 shipments in a calendar year.

1. Cosmetics or beauty preparations (10-15%)
2. 2. Bags, luggage, and similar items (15-20%)
3. Books and other items (0%)
4. Textile products, garments, and similar items (5-25%)
5. Footwear, shoes, and similar items (5-30%)
6. Iron or steel products (0-20%)
7. Bicycles (25-40%)
8. Watches (10%)

(iv). Export of Consignment Goods
MOF Reg. 96 provides regulations regarding the export of consignment goods, which were previously not addressed in MOF Reg.199. Export of consignment goods may be subject to an export duty. Further, prohibited or restricted consignment goods can only be exported after the exporter fulfil the prohibition and/or export restriction requirements.
MOF Reg. 96 also clarifies the provisions regarding export declaration (“PEB”) for the export of consignment goods, as follows:

1. Submission of Consignment Note.
Postal operators must submit a Consignment Note (CN) for the export of Consignment Goods to Customs Officials at the customs office of the export cargo loading if the consignment goods:

• have a gross weight not exceeding 30 (thirty) kilograms;
• are exported by an exporter that is not a business entity; and/or
• are imported goods declared with a CN that will be re-exported.

2. Submission of Export Declaration.
The exporter or the postal operator submits an export declaration for the export of consignment goods to Customs Officials at the customs office of export loading in cases where consignment goods:

• have a gross weight exceeding 30 (thirty) kilograms;
• are exported by an exporter that is a company receiving bonded warehousing facilities;
• are exported by an exporter that is a company receiving warehousing and/or return facilities; and/or are subject to exemptions;
• are imported goods declared with a PIB/PIBK that will be re-exported.

For More Information:

RIZA BUDITOMO - PARTNER
riza.buditomo@aymp.law
+62815-911-0720

RINALDI RAYMOND – ASSOCIATE/CUSTOMS SPECIALIST
rinaldi.raymond@aymp.law
+62818-0874-9666

REZA FAHLEVI – ASSOCIATE/TAX SPECIALIST
reza@aymp.law
+62811-9999-139

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