Ministry to suspend 20% of import licenses

Adianto P. Simamora, The Jakarta Post, Jakarta

About 20 percent of the country's 7,000 importers will have to end their operations soon as the Ministry of Industry and Trade has decided to suspend their licenses following their failure to report to the ministry company data.

The action was part of the ministry's efforts to boost supervision on the country's import activities in a bid to curb smuggling.

Last year, the ministry ordered all importers to submit new data about themselves to the ministry.

However, thus far, only 5,560 of the country's 7,126 importers have complied with the instruction.

The remaining 1,566 importers have not sent any data, leaving the ministry in the dark about their whereabouts.

"I have ordered my staff to freeze their (the importers') identification numbers," Minister of Industry and Trade Rini MS Soewandi said in a seminar.

It remains unclear why the importers have failed to send their new company profiles, but analysts say some of them may have stopped operations due to bankruptcy or not dared to report to the ministry for fear of being investigated.

The government's current intensive efforts to crack down on smugglers have apparently caused jitters among importers who are involved in illegal activities.

Local producers have often voiced complaints about the influx of smuggled goods which they claim have badly hurt their businesses.

As part of the efforts to curb the contraband activities, the Directorate General of Customs and Excise has also ordered all licensed importers to register with the agency. The agency wants to identify which importers are good and which ones are dubious or likely to be involved in smuggling.

Under a joint ministerial decree signed by Rini and Minister of Finance Boediono last December, all importers have to register themselves and submit their company profiles to the customs office by April 1. The customs officials will verify all the company profiles, including their financial reports, submitted by the importers.

Starting next month, only importers who have registered with the customs office will be allowed to continue their activities.

However, the Indonesian Importers Association (Ginsi) said on Thursday the requirements set by the customs office for the registration were considered by many importers "too much" such that they had yet to register themselves only days ahead of the deadline.

"Until now, some 5,000 importers have not yet registered their companies with the customs office," Amiruddin Saud, Ginsi's chairman said.

He thus called on the government to postpone the deadline for several months to give more time to importers to meet all the requirements set by the customs office.

He warned that the country's imports could significantly drop this year if the government refused to extend the deadline and went ahead with its plan to suspend the licenses of importers who fail to meet the deadline.

"Our imports could drop by 50 percent this year," he warned.

Last year's imports reached US$33 billion.

Amirudin also repeated calls for the implementation of a pre- shipment inspection (PSI) system to help curb rampant smuggling and under-invoicing practices.