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Indonesian Restrictions on Imports of Agricultural Products Subject of USTR Comment Request

Tuesday, June 30, 2015
Sandler, Travis & Rosenberg Trade Report

The Office of the U.S. Trade Representative is accepting through July 31 comments on the issues to be discussed by a recently formed World Trade Organization dispute settlement panel that will examine certain measures imposed by Indonesia on the importation of horticultural products, animals and animal products. The U.S. states that these measures appear to be inconsistent with WTO rules, including provisions of the GATT 1994 and the Agriculture Agreement.

According to USTR, Indonesia (a) imposes trade-restrictive import licensing regimes and related requirements on imports of horticultural products and animals and animal products, (b) imposes prohibitions and restrictions on imports of such products, and (c) prohibits and restricts the importation of such products when domestic production is deemed sufficient to fulfill domestic demand. Affected products include fruits such as apples, grapes and oranges; vegetables such as potatoes, onions and shallots; dried fruits and vegetables; flowers; juices; cattle; beef, including secondary cuts; poultry, including chicken parts; and other animal products. USTR has noted that in 2014 the U.S. exported about $122 million in horticultural products and about $63 million in animals and animal products to Indonesia but that “if it weren’t for Indonesia’s prohibitive policies, we would expect to have sold far more than that.”

Requests for WTO consultations on prior versions of these measures prompted Indonesia to replace and amend its import licensing requirements. Specifically, 18 products were removed from regulation, including garlic, garlic powder, chili powder, cabbage, chrysanthemum flowers, heliconia flowers, orchid flowers and several processed products, bringing the total of covered goods down to 39. The amended rules also prescribed a simplified procedure to apply for and receive import permits. However, the U.S. has argued that these and other more recent revisions did not remove the apparent WTO inconsistencies and introduced new restrictions.

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