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Trade Ministry issues decree on coal to restrict exports 11-Aug-2014

The Ministry of Trade announced on Thursday the issuance of a decree obliging coal exporters to register themselves with the directorate general of foreign trade at the ministry.

The Trade Minister Decree No. 39/M-DAG/PER/7/2014 on Rules regarding Coal and Coal Product Exports was issued on July 15, 2014, effective on Sept. 1, 2014, the ministry said in a statement.
The decree was issued on the grounds that coal is a non-renewable mining product. As such, mining products should be optimally utilized for the promotion of the wellfare and prosperity of the people and should be developed in a sustainable, efficient and effective manner, Director General of Foreign Trade Partogi Pangaribuan said in the statement.
The policy aims to prevent over-exploitation, guarantee that local coal demand will be fulfilled, uphold order in (coal mining) business, ensure the traceability of coal mining products, ensure that coal miners will meet their obligation of paying royalties and production fee, and provide business and legal certainty for mining business players," Partogi said.
Over the period of 2009-2013, the national coal exports rose significantly by 187 percent. Based on surveyors data, Indonesian coal exports rose from 220 million tons in 2009 to 413 million tons in 2013.
Partogi also said the decree comes in line with Mineral and Coal Law No 4/2009 which mandates the government control the development of mining resources and the development should give added value to the national economy.
Under the new decree, there are 24 numbers of tariff/Harmonized System (HS) codes for various types of coal product, including anthracite, bituminous type, coke, coal gas and other derivatives.
If a company wants to export coal and coal products, it must first get the Registered Exporter acknowledgement from the directorate general of foreign trade at the ministry. The acknowledgement document is given to companies that hold the Contract of Works, Coal Contract of Works (PKP2B), Operation Production Special IUP (IUPK), Operation Production IUP especially for Transportation and Sales, Operation Production IUP especially for Processing and Refining
The companies must first have obtained recommendation letters from the directorate general of mineral and coal at the Ministry of Energy and Mineral Resources, stating they already have clear and clean status.
All exports should be verified by surveyors appointed by the Director General of Foreign Trade on behalf the Minister of Trade and the verification letter should be attached with receipts indicating that production fee/royalties have been paid.
Once the new decree has come into effect, rules regarding verification and coal export traceability which are contained in Minister of Trade Decree No. 14/M-DAG/PER/5/2008 will no longer be effective. -

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