Latest Updates to Indonesia’s Technical Inspection and Verification Program

PCA NewslettersMar 12, 2025

In 2002, in collaboration with KSO Sucofindo - Surveyor Indonesia, we pioneered Indonesia’s technical inspection and verification program. Initially designed for one commodity – iron and steel – the program now covers 34 different commodities, and we are actively participating in 17 of the largest.

With a population of approximately 281 million, Indonesia is the fourth most populous country in the world. It is also the largest economy in Southeast Asia, with annual imports amounting to USD 263 billion and a GDP per capita of USD 13,900.

Indonesia’s technical inspection and verification program was originally implemented to stop sub-standard steel imports from posing a threat to health and safety and competing unfairly with the local iron and steel industry. Following the initial success of the program, it was realized that other commodity markets could also benefit from careful inspection before shipment to the country. Many of the early programs became necessary because of the misdeclaration of quantity and specification for items such as textiles, sugar and rice. Others were implemented for security considerations, such as precursor chemicals for narcotics, nitro-cellulose for explosives and color photocopiers being used for forgeries. In short, every commodity program was implemented a specific reason.

What is new?

Downstream plastics: Since 2024, these have been included in the list of products subject to inspection prior to shipment. Currently, there are approximately 500 shipments a month, mostly from China, with almost 70% of total plastics imports destined for the food and beverage packaging sectors, half of which are for flexible/rigid packaging. The automotive and electronics industries make up an additional 15% as Indonesia targets the manufacture of 1.4 million new vehicles in 2025. Half of these will be exported, mostly to the Philippines. Other sectors driving demand for plastic products include pharmaceuticals and cosmetics.

Against this background, the Ministry of Trade (MOT) implemented an import licensing program in February 2024, to prescribe the quantities and specifications of different kinds of finished plastic products for import. The technical inspection and verification program is the primary tool used by the MOT to ensure these policies are implemented.

The MOT was concerned about:

The increase in import volumes with low prices due to excess capacity in some foreign countries and unfair trade practices such as subsidies and dumping
Downstream plastic products considered to be a risk to health, safety and the environment

Luggage and bags: This market is projected to grow by 4.75% to USD 4.60 billion by 2029, with most bags being imported from the EU. In principle, businesses can import textiles and bags as raw materials, auxiliary materials or consumer goods for trading, after obtaining the appropriate import permit from the MOT.

There are three categories of permitted import:

General import permits for consumption (API-U), required for parties conducting import activities for trading
Import permits for producers (API-P)
Import permits for suppliers of raw or auxiliary materials (PPBB)

Indonesia’s Ministry of Industry (MOI) has issued a new regulation requiring importers of textiles, textile products, bags and footwear to produce trademark certificates when applying for an import permit.

Hazardous chemicals: Chlorine is the most frequently imported hazardous chemical, used in industry and households. However, chlorine gas exposure, even for short periods and at low levels, can lead to eye, throat and nose irritation, causing coughing and breathing problems.

The MOI has identified two categories of importers of hazardous substances:

Manufacturers and importers (API-P)
General importers (API-U)

Manufacturers/importers (API-P) are not permitted to further distribute hazardous substances on the Indonesian market. General importers (API-U) can only import and distribute hazardous chemicals if they are state-owned companies with a recommendation letter.

According to regulations, the API-P type of importers of hazardous substances must get a recommendation letter from the MOI.

We asked our Indonesian Contract Manager George Bottomley for his insights:

1. What advice would you give to a new exporter to Indonesia?

I would strongly recommend that all new exporters insist that the buyer does their homework to ensure they are entitled to import the goods, have the necessary import permit and, most importantly, that the permit does not expire before the goods arrive in Indonesia.

All Indonesian government decrees are in the local language and use abbreviations and terminology unfamiliar to a foreign supplier. There is nothing worse than for a foreign supplier to learn that their shipment cannot be cleared through customs owing to a minor infringement that they cannot understand.

If exporters have any doubts about whether their shipment will clear customs at its destination, I recommend reaching out to the local SGS office in the country of supply or contacting our partner, KSO Sucofindo - Surveyor Indonesia, for guidance. Their contact details can be provided upon request.

2. What have been the main reasons for the increase in trade regulations?

The government wishes to protect micro, small and medium enterprises, which contribute 61% of GDP and employ 97% of the workforce.

There are also other concerns, particularly related to revenue and health and safety. If imported goods are falsely described, buyers may declare the goods under a different tariff heading and pay less duty and VAT.

Similarly, goods that are misdescribed may enable the importer to avoid a regulation on hazardous substances. It is important, therefore, that an independent party validates the declaration against the actual goods before export to Indonesia.

Learn more about Technical Verification Programs.

This article can also be found in our PCA Newsletter (Q1/2025) – which keeps you up-to-date with developments in technical barriers to trade and product conformity assessment.