Export nightmare for Southeast Asian countries! Customs clearance "red light period" warning!
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For foreign trade personnel who have exported to Indonesia, they may have heard of a shocking word——"Red light period for customs clearance".
The situation is particularly severe this year. Indonesia has destroyed illegally imported goods many times throughout the year, covering clothing, textiles, electronic products, ceramics and other fields.
In Indonesia, customs is divided into red light customs and green light customs. The red light period is actually a policy implemented by Indonesia to protect local businesses. When a certain kind of export goods is classified as a red light category, Indonesian Customs will strictly examine the goods of the export company in order to safeguard the interests of similar domestic production companies. In such cases, it is not uncommon for goods to be held up in customs for months.
The red light period usually occurs from December at the end of each year to March of the following year.During this period, Indonesian Customs will work with other law enforcement agencies to conduct more stringent inspections of import clearance. Compared with usual times, customs clearance procedures will be more complicated and take longer.Improper operation may also result in additional costs. Especially for companies holding red license plates, almost 100% of their goods will be inspected.
The situation is particularly severe this year. Indonesia has destroyed illegally imported goods many times throughout the year, covering clothing, textiles, electronic products, ceramics and other fields. This is mainly because Indonesia discovered that the BPS data of its imported textiles, clothing accessories, ceramics, electronic products, cosmetics, footwear and other textile finished products are significantly different from the data of the country of origin. The country of origin recorded a value of up to US0 million, while Indonesia recorded only US6 million.
In June, the Indonesian Ministry of Trade announced that it would impose safeguard tariffs of 100% to 200% on imported products, such as footwear, ceramics, etc., to restart plans to protect domestic industries.
In July, Indonesia formally established a special working group to rectify illegal imports. The types of commodities it supervises include textiles, electronic products, footwear, clothing, ceramics, and beauty or cosmetics. Indonesian officials stated that the proliferation of these illegally imported products in Indonesia has resulted in a huge trade balance.
In October, the Indonesian Ministry of Industry announced the implementation of mandatory Indonesian National Standards (SNI) for 16 industrial products to ensure product safety, health and environmental compliance. These products include prestressed steel wire, valves, ceramic tiles, safety shoes, etc.
According to relevant practitioners, all ports in Indonesia have now entered a "red light" status, and various terminals and warehouses are undergoing unprecedented strict scrutiny.
Recent export tips to Indonesia
As a country with the largest economic scale and population in Southeast Asia, Indonesia has huge market potential that cannot be ignored. When exporting to Indonesia, in addition to ensuring that the balance is collected before shipment, you also need to pay attention to the following points:
Clear cargo information:Before shipment, it is necessary to fully communicate with local Indonesian merchants regarding the specific category and quantity of goods to understand the latest local customs policies and whether such products may encounter customs clearance obstacles. If necessary, a strong agent at the destination port should be combined to ensure smooth customs clearance.
Consider import rights issues:If an Indonesian merchant lacks the corresponding import rights, or has import rights but has shallow qualifications, the goods will be more likely to be inspected. At this time, the DDP (Delivery Duty Paid) operation method can be adopted, that is, using a well-qualified import agent to complete customs clearance procedures.
Apply for counter-free period:Whether it is a DDP or DDU (Delivery Duty Unpaid) operation, it is recommended to apply to the shipping company for a 14-day container-free period when booking space. In this way, even if the customs clearance time is extended, the container rental fees can be avoided or reduced.
Pay attention to the tax payment deadline:Goods arriving in Indonesia must pay taxes within 30 days. At the Port of Jakarta, if the goods exceed the deadline, they will be sent to the simple warehouse of the supervision agency under the National Port Company. Goods can be stored for 1 to 3 months. If not picked up after the expiration date, they will be auctioned, and the proceeds from the auction will be used to pay storage fees. The balance will be retained for 3 years and will be turned over to the state treasury if it is not claimed. Goods may not be returned until customs duties are paid.
SGS inspection before loading:Since January 2016, Indonesia has implemented strict SGS pre-packaging inspection requirements for many products such as LED lights, old machinery, used machines, textiles, etc. It is necessary to apply for and obtain an SGS number abroad, and the carrier will make an appointment for pre-loading inspection to reduce the risk of being stuck during customs clearance at the destination port.
Confirm import rights and qualifications:Confirm the corresponding import rights and qualifications with Indonesian buyers in China, and clarify the container loading requirements. Make full preparations before shipping to efficiently complete import and export related work.
Make sure the documents are consistent:The exported goods must exactly match the actual packing list. If the goods are found to be inconsistent with the copy of the packing list, invoice, and bill of lading during the container inspection at the destination port, hefty fines will be incurred. For Indonesian products, export documents should be as detailed as possible.
Strictly review customs clearance documents:Before shipment, be sure to review customs clearance documents through a professional export agency and carefully inspect the shipment date. Make a clear inventory of the quantity of goods, strictly review possible loopholes, and then arrange shipment to avoid trouble at the destination port to the greatest extent.
Be aware of FORM E verification risks:When conducting foreign trade activities in the Indonesian market, special attention must be paid to the verification risks of FORM E (Generalized System of Preferences Certificate of Origin). Be sure to remind your peers of this.
Through the above measures, the risks when exporting to Indonesia can be reduced and the smooth customs clearance of goods can be ensured.
