In international trade, importing goods at a lower price does not always mean a transaction will be more profitable. Importers must also consider the possibility of anti-dumping duties (Bea Masuk Antidumping or BMAD), which may be imposed on imported goods found to be dumped and causing injury to domestic industry. For businesses, these duties can increase import costs and reduce profit margins, particularly where selling prices have already been agreed upon before the additional costs arise.
Anti-dumping measures in Indonesia are governed by Government Regulation No. 34 of 2011 on Anti-Dumping Measures, Countervailing Measures, and Trade Safeguard Measures. A product is not considered dumped simply because it is sold at a lower price than similar goods in Indonesia. Dumping is assessed by comparing the export price with the normal value, generally the price of like goods in the domestic market of the exporting country. The investigation must also establish injury to the domestic industry and a causal link between the allegedly dumped imports and that injury. The anti-dumping duty imposed must not exceed the established dumping margin.
Anti-dumping investigations are conducted by the Indonesian Anti-Dumping Committee (Komite Antidumping Indonesia or KADI), which may involve interested parties, including exporters, importers, and domestic producers. During the investigation, KADI may request explanations and supporting documents to assess the alleged dumping and its impact on domestic industry. Article 11 of Government Regulation No. 34 of 2011 requires parties receiving a request for information to submit a written response, together with supporting evidence, within 40 calendar days from the date of the request letter. An extension of up to 30 calendar days may be requested where necessary. Companies should therefore keep track of incoming requests, applicable deadlines, and the documents needed to support their responses.
Importers should first determine whether their goods fall within the scope of an ongoing anti-dumping investigation or an existing anti-dumping measure. This assessment should take into account the goods’ tariff classification, country of origin, supplier, product specifications, and transaction documents. Importers should also review their supply agreements, particularly provisions addressing changes in import duties and the allocation of additional costs. These terms may affect selling prices, profit margins, and the commercial viability of ongoing or planned transactions.
Additional costs may arise even before an investigation is concluded. Under Articles 18 and 19 of Government Regulation No. 34 of 2011, provisional anti-dumping duties may be imposed no earlier than 60 days after the investigation begins, provided the applicable requirements are met. Such duties generally apply for a maximum period of four months, subject to possible extensions in certain circumstances. Article 30 also provides for the possibility of retroactive anti-dumping duties covering imports made up to 90 days before the imposition of provisional measures, subject to specific requirements and excluding imports made before the investigation began. Importers should take these possibilities into account when estimating total import costs, particularly if they continue placing orders while an investigation is underway.
When responding to a request for information from KADI, importers should ensure that their submissions are accurate, consistent, and supported by verifiable records. Depending on the scope of the investigation, relevant documents may include purchase invoices, import volumes, pricing information, and supplier details. Companies should also identify confidential business information and provide sufficient justification when requesting confidential treatment. Under Article 11, a confidentiality request that is not adequately justified may be disregarded. Interested parties may also request a hearing under Article 13, subject to the applicable filing deadline. Preparing responses and supporting records early can help companies avoid unnecessary difficulties in presenting their position during the investigation.
For domestic producers, anti-dumping measures may provide a means of addressing injury allegedly caused by dumped imports. However, an application for anti-dumping duties must be supported by sufficient initial evidence. Article 4 of Government Regulation No. 34 of 2011 sets out the requirements for applications submitted by domestic producers or associations representing the domestic industry. Relevant evidence may include import volumes, import price trends, sales figures, production costs, and the producer’s overall business performance. These records should help demonstrate the alleged dumping, the injury suffered by the domestic industry, and the causal link between them. Before filing an application, producers should assess whether the available evidence adequately supports the allegations.
The initiation of an investigation does not automatically result in the imposition of anti-dumping duties. Under Article 9 of Government Regulation No. 34 of 2011, an investigation must generally be completed within 12 months, although the period may be extended to 18 months in certain circumstances. If the investigation does not establish dumping that causes injury to the domestic industry, the investigation must be terminated. If the relevant requirements are met, KADI submits its recommendation to the Minister of Trade for further action under the applicable procedure. The amount and duration of any anti-dumping duties are determined in accordance with the relevant provisions, including Articles 27 and 30, which generally limit the duration of such measures to five years, subject to the applicable review provisions.
For importers, anti-dumping investigations should form part of the broader assessment of trade and supply-chain risks, particularly where the business relies on suppliers from countries subject to investigation. Domestic producers, meanwhile, should ensure that their records are sufficient to support an application under the applicable requirements. A clear understanding of the investigation process, together with a careful review of contractual arrangements and supporting documents, can help businesses assess their legal position and make informed commercial decisions.
If you, a prospective client, have further inquiries about the topic discussed above, Schinder Law Firm is one of many corporate law firms in Indonesia that has handled numerous similar matters, with many experienced and professional corporate and civil lawyers in its arsenal, making it one of the top consulting firms in Indonesia. Feel free to contact us at info@schinderlawfirm.com for further consultation.
Author:
Dewi Susanti