Customs, importers accuse each other of smuggling
By Riyadi
JAKARTA (JP): Importers and the customs office have been exchanging accusations over rampant smuggling practices, with the former putting the blame on the later and vice versa.
Importers have accused customs officials of helping irresponsible importers to smuggle goods into Indonesia, through sea-cargo imports worth US$5,000 or less per shipment.
An executive of the Indonesian Textile Association, Lily Asdjudirja, hinted recently that many smuggled textiles enter Indonesia in shipments valued at less than $5,000.
The chairman of Indonesian Importers Association, Amirudin Saud, confirmed Lily's statement, saying that it was not only textiles, but also electronics, which had been smuggled into Indonesia through shipments worth less than $5,000.
Director General of Customs and Excise Soehardjo Soebardi dismissed the accusation as groundless. He challenged the textile and importers' associations to present him with evidences.
"It's slander. Prove it, if they have evidence. Don't just throw out an accusation," Soehardjo said.
Under the current preshipment inspection system, sea-cargo imports worth more than $5,000 must be inspected at points of loading by the designated surveyor, state-owned PT Surveyor Indonesia.
Customs is only allowed to inspect sea-cargo imports worth up to $5,000 and air-cargo imports.
Soehardjo, in return, accused importers of under-weighing and under-invoicing shipments of imported goods worth more than $5,000.
"Many imports which have been inspected by the designated surveyor still contain some customs violations ... We don't know what happens to containers after being inspected, their contents may be changed or some more added," Soehardjo said.
To support Soehardjo's claim, Director for Investigation and Elimination of Smuggling Thomas Sugiyata showed last week journalists and executives of the textile association six containers of imported textiles and apparels which had been under weighed.
Thomas said all six containers were equipped with surveyor reports, meaning that they had been inspected at points of loading by PT Surveyor Indonesia. Nevertheless, customs officials found significant weight discrepancies.
Amirudin criticized the way the customs office responded to the textile association's complaints.
By demonstratively showing the six containers to journalists and textile association executives, Amirudin said, the customs office seemed to cover up its sins over smuggling cases which involved customs officials.
He said most textile imports came in shipments worth less than $5,000, even though their actual value far exceeded $5,000, to avoid preshipment inspections.
If the customs office was really serious about eliminating smuggling of textiles and other products, Amirudin said, it should first of all investigate all past imports worth less than $5,000 because it was not only textiles but also other products smuggled into Indonesia using shipments worth less than $5,000.
He said in the first 11 months of last year, he had reported to the customs office 92 cases of possible smuggling which involved customs officials. But, as yet, he has not received any response.
Most of the smuggled goods were consumer goods, mainly electronics, imported from or through Singapore. They entered the country in packages which were claimed to be worth less than $5,000, which exempted them from preshipment inspections.
Amirudin said each of the 92 cases was worth more than $5,000. Many of them were worth a $100,000 each and some were worth more than $1 million each.
Such an exchange of accusations between importers and the customs office is especially inflammatory when the latter is about to regain its inspection authority after loosing it for 11 years.
President Soeharto stripped the customs office of its inspection authority in mid-1985 due to rampant corruption of its services.
He then assigned Geneva-based Societe Generale de Surveillance to inspect Indonesia's imports at points of loading. And, in 1991, the government appointed PT Surveyor Company to take over the inspection works. Since then, the Swiss company has been working as a subcontractor for Surveyor Indonesia.
Nevertheless, the finance minister has decided to cease the government's contract with Surveyor Indonesia and return the inspection authority to the customs office, starting April 1, when the new customs law comes into force.
The minister of finance, however, has not stated clearly whether the government would terminate the current preshipment inspections when the customs office resumes its inspection authority.
Importers, still traumatized by the corrupt practices of customs officials, vehemently defended the current preshipment inspections.
They even appealed that the government allow importers to use preshipment inspections of their imports, at their costs, to ensure that they received precisely what they had ordered from abroad.
Preshipment inspections system are necessary, especially for small and medium-sized importers because they had no resources to claim back whenever there were discrepancies between what they received and what they had ordered.
I Nyoman Moena, former president of Surveyor Indonesia, suggested that the government maintain preshipment inspections when returning the inspection authority to the customs office.
He said the future demand for customs inspections would be to ensure smooth flows of goods and increase cautions over possible smuggling, under or over invoicing, dumping, and the like.
"This is a kind of dilemma because whenever you put emphasis on the smooth flow of goods, you tend to disregard caution and accuracy in inspections, and vice versa. So, to combine the two objectives, preshipment inspections must be maintained, along side the postaudit system," Moena said.
He noted that preshipment inspections were also needed to curb imports through the introduction of standards, not tariffs, because "the future trade fights would not be through tariffs but through standards".
Preshipment inspections would also be required in a regional free-trade area, like that designed for the Southeast Asia, to come into effect by 2003, to verify local or regional content of certain products.
"Otherwise, there would be many free riders benefiting from such a free-trade arrangement," Moena said.