Pre-shipment inspection debated in legislature
Pre-shipment inspection debated in legislature
JAKARTA (JP): House deliberation on the customs bill was
dominated by the pros and cons of the pre-shipment inspection
system for imports which has been in use since the middle of
1985.
The associations of Indonesian importers, exporters and ship-
owners led by Amirudin Saud on one side and economist Rizal Ramli
from the Econit economic research institute on the other argued
yesterday before the House's Golkar faction over the best customs
clearance system for Indonesia.
The three associations, which prefer the current pre-shipment
inspection system, demanded that the pre-shipment inspection for
imports be stipulated clearly in the bill, while Econit suggested
that the bill be left open for either pre-shipment inspection or
post-shipment customs checks.
Amirudin, chairman of the Indonesian Importers Association,
argued that the pre-shipment inspection system has greatly
facilitated smoother imports.
"The present system has proven to be quite effective in
facilitating the smooth flow of imports, cutting importing costs,
minimizing administrative irregularities and under-invoicing,"
Amirudin said at the hearing.
Also present at yesterday's hearing were Hamid Ibrahim Ganie,
chairman of the Indonesian Exporters Association, and Syawal of
the Indonesian Ship-Owners Association.
Amirudin noted that pre-shipment inspection helps prevent the
customs officials from abusing their power, which occurred
frequently before the introduction of the system in 1985.
"If we return to the old system, I'm sure that there will be
many problems, especially the possible collusion between customs
officials and businessmen and more congestion at our ports,"
Amirudin said.
However, Rizal contended that the post-shipment inspection
system differs greatly from the on-arrival inspection system,
which was employed by Indonesia until 1985.
On-arrival inspection of imports caused congestion and delay
at sea ports because the customs officials inspected all imported
goods at the local ports, Rizal said.
He said that the post-shipment, or post-audit system, is
basically a self-assessment system, by which customs officials
inspect containers selectively. Inspections can even be done in
the importers' warehouses or factories.
"After ten years of the pre-shipment inspection system, it is
time for Indonesia to gradually adopt the post-audit system,"
Rizal said.
The pre-shipment inspection system was launched in 1985 under
a presidential decree, which stripped the customs and excise
directorate general of its inspection authority. The government
later assigned the Geneva-based Societe Generale de Surveillance
(SGS) to inspect Indonesian imports at points of loading.
The contract with SGS was modified in 1991 after the
government formed a new inspection company, PT Surveyor Indonesia
(PTSI), in a joint venture with SGS. The main contract for
inspection was later awarded to PTSI, which in turn hired SGS as
a sub-contractor. PTSI is expected to eventually take over the
whole inspection from SGS.
However, Rizal contends that the cost of the pre-shipment
inspection system to the government was too high.
"After ten years of SGS's operation here, customs officials
still had no access to SGS's data and information system," Rizal
said.
However, most port users, including all foreign businessmen,
have demanded the maintenance of the present system.
"If cost is the main issue, we importers are wiling to bear
them," Amirudin pointed out.
He added that the costs are actually negligent compared to
the great benefits, citing the smooth import flows that have
sharply reduced importing costs.
Moreover, Amirudin added, since Indonesian industrial
companies depend largely on imported raw, intermediate and
capital goods, any delay or snag in import flow will adversely
affect the competitiveness of the country's exports. (rid)