Guide to Agricultural Investment in Indonesia (1)

Agribusiness Investment Reform

The investment enviroment provided by Indonesian government is primarily intended to create a more conducive environment for agribusiness development and an incentive for farmer and private enterprises to carry out agricultural activities. Hence, investment by both foreign and domestic investors is aimed at stimulating and encouraging investment in production activities with the direct involvement of farmers and other parties in private sectors.

The primary target of agribusiness investment is increasing production in food crops, horticulture, estate plantation and livestock the investment also plans to create production facilities for inputs like fertilizers and agricultural machinery. It is expected that these investments in processing, distribution and marketing activities, as well as the financial system will accelerate the development of agribusiness in rural area.

During the 2005-2006 periods, total domestic investment in agribusiness was Rp 40,713.1 billion. With largest contribution invested in food industry and estate crop. Due the economic crisis, this number declined to Rp 766 billion in 1998. The domestic agribusiness investment was about Rp 763.3 billion due to the more actable economic and political condition in Indonesia. And in 2006, the number domestic investment was Rp 28,301.7 billion.

Foreign investment trend were decrees, during period 2005-2006 total foreign investment in agribusiness was US$ 3,009.3 billion and average US$ 1,504.7 billion. In 2006, the number foreign investment was US$ 1,904.9 billion. However during 2006 the number of foreign investment was growing as well as the domestic investment.

Investment policies statement

Recognizing, that the importance of private sector investment to achieve sustainable economic growth, employment creation, development of strategic national resources, transfer and implementation of competitive technology and technical skills, export growth and improved balance of payments.

Appreciating, that an appropriate legal framework is prerequisite to promoting a stable, predictable and attractive business environment in order to encourage and support private economic activity Indonesian and foreign investors.

Acknowledging, that an appropriate legal framework for investment must provide certain key principles, among which are: equal treatment of investor in similar circumstances irrespective of nationality; protection against expropriation, confiscation or requisition of investments and unilateral alteration or termination of contracts, freedom to repatriate foreign investment capital and net proceeds there on; and access to impartial, quick and effective mechanisms for the resolution of commercial and other investment disputes.

Cognizant, that these principles have increasingly been adopted as standard international practice and have been incorporated into national legislation in many countries, both regionally and globally, and have been recognized in various international documents, including the GATT/WTO agreements, the APEC Non Binding Investment Principles, and numerous bilateral investment agreements.

Undertake and resolves to reform the investment policies, legislation and regulations of the Republic so as to create and enabling environment for private investment consistent with the above stated principles, to be characterized by active promotion and facilitation of investment, transparent criteria for the admission and establishment of investments, transparency of government procedures and administration, screening and licensing requirements based on a short “negative list” of restricted investment.

The government has therefore established an “Investment Policy Reform Initiative” having as its objective the encouragement and facilitation of private sector investment through reform and implementation of transparent, predictable, market oriented policies applied equally to both foreign and domestic investors. In this the government has recently adopted major policies changes, including liberalizing the rules for foreign investment.

The government is committed to the rapid elimination of the remaining restriction on foreign and local private investment. This statement sets forth newly adopted and current policies of the Government for promoting and facilitating private sector investment in Indonesia. The Government is fully committed to these policies and will take the necessary steps to ensure their effective implementation. This statement will be supplemented by detailed investment guidelines to be issued in the near future. To encourage and facilitate private investment, the government has adopted the following policies.

Freedom to Invest

Investors shall be permitted to invest in any sector of the economy except in small number of activities, which are listed on “negative list”. There shall be no restriction on the size of the investment, the source of funds or whether the product s is destined for export or for the domestic market. Exciting foreign investors may invest in activities other than those initially authorized, except for activities started on “negative list”.

Company Formation

Industrial licenses are still needed based on the principles of fairness, simple, quick and transparent mechanism and procedure. Procedures for company formation are to be administered so as to permit prompt establishment of business enterprises.

Taxes and Duties

The government is committed to enhance the country’s investment climate and international competitiveness by further reducing simplifying taxes and duties through ongoing tax and trade policy reform programs. The current Indonesia tax law provides tax incentive to investor who invests in certain sectors and or certain areas as follows:
-Investment allowances,
-Accelerated depreciation and amortization,
-Expanded loss compensation but not more than 10 years,
-10% tax rate for dividend paid to foreign tax payer, except to prevail tax convention maintaining lower tax rate.

Indonesia always tries to maintain equal treatment in tax law not only for tax cases that have similarities. By giving tax incentive to investors, Indonesia must assure that this incentive granted still reflect the principle of equal treatment and the application of that principle did not depart from the objective of tax incentive.

Availability of to Foreign Exchange

The government will continue to ensure, according to pre-set criteria and procedures that foreign exchange for import transactions and dividend payments is freely available and the Governments is committed to ensuring the ease of repatriation of capital and payments for business services.

Access to Local Funding

The government is considering introducing a simple system that will allow foreign investments access to local funding based on simple established criteria.

Labor Practice

Within the framework of the labor laws of Indonesia, the Government recognizes that enterprises may require foreign expertise. Accordingly, it will continue to make residence permits readily available according to prevailing regulation for key personnel required for employment in such enterprises.

General Infrastructure

The Government recognizes the importance of infrastructure to support investment and is committed to make available adequate infrastructure such as transport, electricity, water, and communications through partnership mechanisms that attract private capital. Adequate legal protection including guarantees for the integrity of contracts will be provided.

Availability of Land

The government is committed to ensure that land for industrial and commercial use is ready available to investors. The Government will receive and simplify all existing land licensing and environmental approval procedures to ensure transparency.
The Government is committed to develop new serviced industrial sites and has provided the necessary framework to enable private investors to develop industrial sites including through arrangements for subleasing to other investors.

Encouragement for small and medium Enterprises

The country’s small and medium scale enterprises hold great potential for rapid economic growth and employment creation. The Government is therefore dedicated to continuing with various programs assists these enterprises, including simplifying the regulatory and policy environment, removing obstacles to securing access to raw materials, removing tax related impediments and improving access to credit.

The Government will promote mutually advantageous, commercially beneficial subcontracting/partnership arrangements between large-scale foreign and local firms and small- and medium-scale business.

Investment Promotion

To further enhance the capacity of the BKPM (Investment Coordinating Board) and to create an integrated investment promotion regime, the Government is actively reviewing proposals for the formation of an independent, public private partnership to promote and facilitate all private investment in Indonesia.

Investment Services

The Government is committed that investment services for foreign and domestic investment in the era of the regional autonomy is more preferable that the current condition. Therefore, a “one stop service” system will be introduced to be implemented in the region.

Investment Protection

The government recognizes that security of assets of investor is of paramount importance. It therefore, assures investors that it will avoid using any measures that will adversely affect their property rights. In the case of foreign investors, the Government has negotiated and concluded several bilateral investment treaties, which provide direct protection to investors for the security of their assets as well as assurances for the repatriation of proceeds from their investments. The Government will actively work to pursue to conclude additional bilateral investment treaties with other countries. Indonesia has also joined the Multilateral Investment Guarantee Agency (MIGA).

Double Taxation Relief

To improve economic and trade relationship with other countries, Indonesia would like to have certain law provisions that regulate the right of tax imposed law imposed from each country. The purposes of those provisions are achievement of rule of law, avoiding double taxation, and prevention of tax evasion. Government is entitled to make an agreement with other countries to avoid double taxation and to prevent tax evasion.

The frame work and the matter of this agreement are based on international convention and other rule of laws and also the tax regulation of each country.

Arbitration

The Government recognized that foreign investors must have an appropriate forum to resolve disputes that cannot be settled amicably. While such disputes would normally lie within the jurisdiction of a competent court, parties may agree in certain cases to pursue extra-judicial adjudication and to choose an appropriate forum, including international conciliation or arbitration. To that end, Indonesia has become a member of the International Center for settlement of investment Disputes (ICSID) at Washington DC.


To be continued.

Source: Guide to Agricultural Investment and Trade Opportunities in Indonesia,
Ministry of Agriculture, the Republic of Indonesia

Pets: Requirements for Entrance into Indonesia

Prosedur Pemasukkan Hewan Piaraan ke Indonesia

Prosedur Pemasukan Hewan Piaraan Anjing, Kucing, Kera dan Hewan Sebangsanya dari Luar Negeri ke Wilayah / Daerah Bebas Rabies di Indonesia

Surat Permohonan

Untuk memasukkan hewan anjing, kucing, kera dan hewan sebangsanya dari luar negeri ke wilayah/daerah bebas rabies di Indonesia harus mengajukan permohonan kepada Direktur Kesehatan Hewan, Direktorat Jenderal Bina Produksi Peternakan Departemen Pertanian, sekurang-kurangnya 1 (satu) bulan sebelumnya dengan alamat Kantor Pusat Departemen Pertanian, Gedung C Lantai IX Jalan Harsono RM No.3, Ragunan, Pasar Minggu, Jakarta Selatan, Telp.+62-21-781-0090, +62-21-782-7466 Fax: +62-21-781-5783. Dalam permohonan ijin masuk supaya diberi keterangan tentang hewan yang akan dibawa yang meliputi: bangsa/ras; jenis kelamin; umur; warna; tanda-tanda khusus; nama hewan; tempat tinggal setelah di Indonesia.

Persyaratan

Mempunyai surat keterangan kesehatan hewan atau Health Certificate dari dokter hewan negara asal yang menerangkan bahwa hewan tersebut telah diperiksa kesehatannya dan dinyatakan sehat, dan selama 4 bulan terakhir tidak ada kejadian penyakit rabies.

Mempunyai surat keterangan identitas (paspor) yang berisi antara lain telah berada atau dipelihara sekurang-kurangnya 6 (enam) bulan di negara asal dan hewan telah berumur 6 (enam) bulan serta tidak dalam keadaan bunting umur 6 (enam) minggu atau lebih.

Surat keterangan vaksinasi rabies yang menerangkan bahwa hewan sekurang-kurangnya 1 (satu) bulan dan paling lama 1 (satu) tahun sebelum diberangkatkan telah disuntik dengan rabies, kecuali anjing, kucing, kera dan hewan sebangsanya itu berasal dari daerah bebas rabies dimana vaksinasi rabies tidak diperlukan/dilarang.

Prosedur Karantina

Kepada Stasiun Karantina Hewan supaya diberitahukan tanggal kedatangan hewan tersebut, dengan kapal laut/pesawat apa dan perkiraan jam kedatangan agar persiapan dapat dilakukan sebelumnya oleh petugas yang akan memeriksa hewan tersebut pada waktu kedatangannya.

Pemilik/importir atau agen yang ditunjuk bertanggung jawab terhadap hewanannya pada saat hewan tersebut tiba di pelabuhan/bandara laut/udara dan wajib mengurus penyelesaian hewannya dengan mengajukan permohonan pemeriksaan kepada Dokter Hewan Karantina di pelabuhan laut/udara tersebut.

Kepada Dokter Hewan Karantina harus diserahkan:

Surat ijin pemasukan anjing, kucing, kera dan hewan sebangsanya yang dikeluarkan oleh Direktur Kesehatan Hewan Departemen Pertanian.

Surat Keterangan Kesehatan (health certificate) dari dokter hewan negara asal.

Surat Keterangan dari nahkoda/pilot yang menyatakan bahwa selama dalam perjalanan hewan tidak pernah didaratkan dan selama berada di atas kapal tidak ada kejadian rabies.

Surat keterangan vaksinasi rabies.

Pemeriksaan di Karantina Hewan

Jika pada saat pemeriksaan ternyata hewannya sehat, tidak menderita penyakit rabies dan surat-surat yang diperlukan lengkap serta hewan tersebut berada dari daerah bebas rabies, maka Dokter Hewan Karantina membuat Surat Ijin Keluar Karantina dan hewannya dapat segera dikeluarkan/dibebaskan dari karantina hewan.

Jika pada pemeriksaan ternyata hewannya sehat, tidak menderita penyakit rabies dan berasal dari daerah bebas rabies, tetapi surat-suratnya tidak lengkap maka oleh Dokter Hewan Karantina diberikan waktu tertentu kepada pemilik untuk melengkapi surat-surat dimaksud dan selama waktu tertentu tersebut hewan ditahan di karantina.

Jika pada pemeriksaan ternyata hewan sehat, tidak menderita rabies, tetapi surat-surat keterangan yang diperlukan tidak dapat dilengkapi pada waktunya atau hewannya berasal dari daerah rabies maka hewan tersebut wajib dikarantina selama 4 (empat) bulan.

Belut China dipalsukan labelnya sebagai belut Jepang

Polisi Kobe telah menahan 8 orang yang terlibat dalam pemalsuan label belut bakar asal China. Belut bakar sebanyak 256 ton yang dibudidayakan di China telah dipalsukan labelnya menjadi belut bakar yang dibudidayakan di Prefektur Aichi, Jepang. Pemalsuan label belut bakar asal China ini terjadi di daerah Takamatsu, Prefektur Kagawa, Jepang pada bulan Pebruari - Maret 2008. Perusahaan importir seafood pemalsu diduga telah menjual belut sebanyak 49 ton kepada intermediate wholesaler melalui wholesaler yang terlibat pada bulan Maret - Juni 2008.

Belut bakar yang dibudidayakan di Jepang biasanya harganya mencapai dua sampai tiga kali lipat harga belut bakar yang dibudidayakan di China.

Importir seafood yang terlibat kasus ini menyampaikan pemalsuan label ini untuk menghapus dalam inventory bahwa belut bakar yang dibudidayakan di China tidak dijual, setelah terdapat laporan keracunan makanan beku yang mengandung pestisida asal China pada akhir Januari 2008.

Sumber : Japan Times November 16, 2008

Pascal Lamy Calonkan Diri Dirjen WTO

Pimpinan General Council Bruce Gosper telah menyampaikan kepada anggota WTO pada tanggal 4 November 2008 bahwa Direktur Jenderal Pascal Lamy telah mengumumkan akan mencalonkan diri sebagai Direktur Jenderal lagi untuk masa jabatan kedua menjelang jabatannya berakhir 2009.

Duta Besar Gosper mengatakan bahwa dia telah menerima surat dari Lamy yang menyatakan keputusannya untuk mencalonkan diri sebagai Direktur Jenderal untuk masa jabatan berikutnya. Duta Besar Australia yang memimpin seleksi ini, telah mengingatkan para anggota WTO tentang prosedur seleksi (Procedures for the appointment of Directors-General) dalam Rapat General Council 14 Oktober 2008.

Untuk itu disyaratkan pejabat lama mencalonkan diri untuk masa jabatan kedua pada akhir bulan November 2008. Setelah itu dilakukan pemilihan terbuka sampai akhir Desember 2008 untuk penambahan kandidat yang dinominasi.

Apabila tedapat kandidat baru, mereka diberikan waktu 3 bulan sampai dengan akhir Maret 2009 mengkampanyekan dirinya kepada para anggota WTO, kemudian dilanjutkan 2 bulan proses seleksi yang berakhir pada akhir Mei 2009.

Adapun persyaratan untuk seleksi Direktur Jenderal WTO adalah sebagai berikut.


PROCEDURES FOR THE APPOINTMENT OF DIRECTORS-GENERAL

Adopted by the General Council on 10 December 2002


The General Council, acting pursuant to Articles IV.2, VI.2 and IX.1 of the WTO Agreement, agrees to the following procedures for the appointment of the Director-General.

Conduct of the appointment process

1. The appointment process shall be guided by the best interests of the Organization, respect for the dignity of the candidates and the Members nominating them, and by full transparency and inclusiveness at all stages, building on the best practices established over the past years with regard to internal transparency and participation of all Members.
2. The overriding objective of Members in this process shall be to reach decisions by consensus.
3. The process leading up to the decision by the General Council to appoint a Director-General shall be conducted by the Chair of the General Council in consultation with Members and in accordance with the procedures set out herein.
Facilitators

4. The Chair of the General Council shall be assisted in this process by the Chairs of the Dispute Settlement Body and the Trade Policy Review Body acting as facilitators.
5. The Chair and the facilitators shall act impartially and objectively, and conduct their work in a transparent manner.
6. The Chair and the facilitators shall aim to encourage and facilitate the building of consensus among Members, and assist them in moving from the initial field of candidates to a final decision on appointment.
Time-frames for the process

7. The appointment process shall start nine months prior to the expiry of the term of an incumbent Director-General with a notification from the Chair to the General Council. The process shall conclude with a meeting of the General Council convened not later than three months prior to the expiry of an incumbent's term, at which a decision to appoint a new Director-General shall be taken.
8. Members shall have one month after the start of the appointment process to nominate candidates. Nominations shall be submitted by Members only, and in respect of their own nationals. The candidates nominated shall then have three months to make themselves known to Members and to engage in discussions on the pertinent issues facing the Organization. The remaining two months prior to the conclusion of this process shall be devoted to selecting and appointing one of the candidates.
Qualifications of candidates

9. In broad terms, candidates should have extensive experience in international relations, encompassing economic, trade and/or political experience; a firm commitment to the work and objectives of the WTO; proven leadership and managerial ability; and demonstrated communications skills.
Nomination procedure

10. Nominations and supporting information shall be addressed to the Chair of the General Council and received not later than one month after the start of the process. These documents will be distributed to Members as they are received. Immediately after the close of the nomination period, the Chair shall communicate to Members a consolidated list of the candidatures received.
11. Nominations shall be accompanied by the curriculum vitae of the candidate and any additional supporting information.
12. Where a serving Director-General decides to seek reappointment, he or she shall so notify the Chair of the General Council before the start of the process, and shall thereby be considered to be a candidate. The Chair shall inform Members of the candidature of the incumbent Director-General, in order that they may take this into consideration in submitting their nominations.
Representativeness of candidates

13. In order to ensure that the best possible candidate is selected to head the WTO at any given time, candidatures representing the diversity of Members across all regions shall be invited in the nominations process. Where Members are faced in the final selection with equally meritorious candidates, they shall take into consideration as one of the factors the desirability of reflecting the diversity of the WTO's membership in successive appointments to the post of Director-General.
Meeting with the candidates

14. As early as possible after the close of the one-month nomination period, candidates shall be invited to meet with Members at a formal General Council meeting. Candidates will be invited to make a brief presentation, including their vision for the WTO, to be followed by a question-and-answer period.
Consultation process

15. In the final two months of the process, the General Council shall proceed, through a process of consultations, to narrow the field of candidates and ultimately to arrive at its choice for appointment.
16. In arriving at its choice, the General Council shall aim to reach a decision by consensus.
17. The Chair, with the assistance of the facilitators, shall consult all Members, including non-resident Members, in order to assess their preferences and the breadth of support for each candidate. The ultimate aim of the consultation process shall be to identify the candidate around whom consensus can be built. In order to do this, it may be necessary to conduct successive consultations to identify the candidate or candidates least likely to attract such a consensus.
18. The outcome of the consultations shall be reported to the membership at each stage. It is understood that the candidate or candidates least likely to attract consensus shall withdraw. The number of candidates expected to withdraw at each stage shall be determined according to the initial number of candidates, and made known in advance. This process shall be repeated in successive stages on the basis of a revised slate of candidates each time, with the aim of establishing consensus around one candidate.
19. At the end of the final stage of the consultative process, the Chair, with the support of the facilitators, shall submit the name of the candidate most likely to attract consensus and recommend his or her appointment by the General Council.
Recourse to voting as a last resort

20. If, after having carried out all the procedures set out above, it has not been possible for the General Council to take a decision by consensus by the deadline provided for the appointment, Members should consider the possibility of recourse to a vote as a last resort by a procedure to be determined at that time. Recourse to a vote for the appointment of a Director-General shall be understood to be an exceptional departure from the customary practice of decision-making by consensus, and shall not establish any precedent for such recourse in respect of any future decisions in the WTO.
Term of office

21. The Director-General shall be appointed for a term of office of four years, and shall be eligible for reappointment for a further term not exceeding four years. There shall be no expectation of automaticity in the reappointment.
22. In order to ensure continuity at the senior management level, the terms of office of the Director-General and of the Deputy Directors-General shall be staggered, such that the terms of the Deputies expire subsequent to the expiry of the Director-General's term.
23. In the event of a vacancy in the post of Director-General, the General Council shall designate one of the existing Deputy Directors-General to serve as Acting Director-General until the appointment of a new Director-General. The Chair of the General Council shall initiate, as soon as possible, a process for appointment of a new Director-General, in keeping with the procedures set out herein, and may establish expedited deadlines as necessary in consultation with Members.
Remuneration package

24. The remuneration package for Directors-General shall be established by the Committee on Budget, Finance and Administration and subject to the approval of the General Council. It shall not be negotiable with a Director-General-designate.
Contract of appointment

25. The contract of appointment, including the remuneration package, shall be signed jointly by the Director-General-designate and by the Chair of the General Council acting in the name of the WTO.

Sources : WTO : News Items, November 4, 2008