New customs system 'creates uncertainty'

JAKARTA (JP): Importers are concerned by uncertainties in some areas of the new customs clearance system, analysts said here yesterday.

I Nyoman Moena, a former president of PT Surveyor Indonesia and currently a trade analyst, and Munti Yarso of PT SGS Services Indonesia identified four elements of the new system which were causing problems in the customs clearance of imports.

They are related to the transaction value of imported goods, tariff classification, customs' decision to direct imported goods to green or red lanes and the post entry-auditing of imports.

"Uncertainties could jeopardize the conducive to business climate that we are building up," Moena told a business luncheon at the World Trade Center.

The government implemented a combination of on-arrival inspection and post-entry audit systems with self assessment of import duties in April as part of its enforcement of the new customs law.

The system replaced the pre-shipment inspection of imports system which was started in mid-1985 to bypass the then corruption-infested customs service.

Munti said the post-entry audit part of the new customs clearance procedures created the most uncertainties for importers.

Worse still, importers were still completely in the dark about the criteria for post auditing, he said.

"As the criteria for post auditing are not yet clear, you importers must be ready at all times to receive the customs auditors who will come knocking at your doors in the near future," Munti said at the meeting.

Moena said that the post auditing of imports created a high degree of uncertainty because importers never knew when it would be conducted or whether they had to pay additional import duties.

Director of Verification Roy Ronald Lino has said that the customs office would use risk management to determining post auditing of imports and it would notify importers beforehand about any audit to be conducted.

Munti said transaction value and tariff classification also worried importers.

Transaction value and tariff classification determine the duty importers have to pay.

The new customs clearance system follows the international harmonized system on tariff classifications and General Agreement on Tariffs and Trade (GATT) valuation code in determining the transaction value of imported goods.

"Most importers still do not know what kind of animal the GATT valuation code is," Munti said.

He said customs officials and importers often differed on tariff classification -- they were not sure whether a tariff should be five percent or 10 percent or even 40 percent.

Moena added: "tariff classification can always be corrected and corrections depend on who is in charge. So, here again it is full of uncertainties for importers."

He said importers also never knew when their goods would be taken to the red lane for physical inspection or the green lane for direct clearance.

"Again there are no clear-cut criteria here and this is another source of uncertainty," Moena said.

The customs office has said it will send imported goods to the red lane only if it receives an intelligence note which necessitates physical inspection.

And director general of customs and excise, Soehardjo Soebardi, has repeatedly said that importers had no need to worry in their dealings with customs officials, provided they declare their goods correctly.

Moena said the customs office should clear up the uncertainties by explaining the procedures and criteria to importers and the general public.

"Whatever the system, it should be fully transparent and should not create uncertainties in the business sector," Moena said.

Moena suggested the customs office give importers the freedom to choose either pre-shipment inspection or on-arrival inspection for their consignments.

He said the customs office could also contract inspection work to PT Surveyor Indonesia which has extensive branches overseas.

Rudy J. Pesik, president of trading firm Pinter Pesik International and freight forwarding firm PT Birotika Semesta, said the customs office should also improve its electronic data interchange system.

He said the system was too simple and could not yet disseminate simultaneously information on imports to all connected parties, including banks, the port and airport authorities.

"The customs electronic data interchange system is more like an electronic transfer system than a data interchange system," he said. (rid)