CLIENT NEWSFLASH

BI Regulates Foreign Exchange Export Proceeds and Loans

Bank Indonesia (BI) has updated Bank Indonesia Regulation No. 14/25/PBI/2012 regarding Receipt
of Foreign Exchange Export Proceeds and Withdrawal of Foreign Exchange External Loans with the
issuance of PBI No. 16/10/PBI/2014 dated May 14, 2014 (the PBI).
The PBI governs the supervision of export proceeds in the form of foreign exchange and the
withdrawal of foreign exchange loans through Indonesian banks. Aspects of the PBI are further
specified in BI Circular Letter No. 16/9Dsta, dated May 26, 2014, regarding Receipt of Foreign
Exchange Export Proceeds (the SEBI), which replaced BI Circular Letter No. 15/9/DSM.
Obligation to Receive Foreign Exchange Export Proceeds through Foreign Exchange Banks
The PBI requires that all foreign exchange export proceeds must be received by a foreign exchange
bank no later than the end of the third month after Notification of Exported Goods (Pemberitahuan
Ekspor Barang - PEB) is registered. This obligation does not apply to government foreign exchange
export proceeds paid in cash in Indonesia and received through BI.
For payment made through letter of credit, consignment, open accounts or collection of which the
due date exceeds or is equal to three months after PEB registration, the time limit is 14 days after
the payment due date.
Neither the PBI nor the SEBI specify any period of time that the foreign exchange export proceeds
must be kept in the foreign exchange bank. The PBI and SEBI also allow the foreign exchange export
proceeds to be received in foreign currency, meaning that they do not have to be converted to
Rupiah first.
This is in line with Law No. 7 of 2011 regarding Currency, which prohibits the use of physical bills of
foreign currency for domestic transactions but does not prohibit the use of foreign currency for
other transactions (such as bank transfer).
Obligation to Report
Exporters must submit their PEB to the foreign exchange bank by the fifth day of the following
month. If payment is received in cash in Indonesia, exporters must submit supporting documents
directly to BI on the fifth day of the month following PEB registration. The obligation to submit
information and documents to BI only applies to export transactions valued greater than USD 10,000
or its equivalent.
Moreover, exporters that receive payment through letter of credit, consignment, open account or
collection must provide supporting documents for the transaction to the foreign exchange bank to
be forwarded to BI by the fifth day of the month following PEB registration.

 Discrepancies between Proceeds and PEB

Under the PBI, the actual amount of export proceeds must fit the amount stated in the PEB. The
value of export proceeds is considered appropriate, and exporters do not have to submit supporting
documents, if it is less than the PEB with discrepancy less than IDR 50 million.
If the discrepancy exceeds IDR 50 million, the exporter shall submit a written clarification explaining
the reasons for the discrepancy, which may result from:
1. exchange rate discrepancy, discounts/rebates, administration fees, and/or other related
international trade fees, in which case the discrepancy between foreign exchange export
proceeds value and PEB value can be maximum 10% of the PEB value; and/ or
2. toll manufacturing, repair services, operational or financial leasing, price fluctuations, as well
as composition, quantity and quality differences in goods.
Specifically for mining products (oil and gas, minerals and coal), a written clarification does not need
to be submitted for discrepancies up to 10% of the PEB value. The provision on export of mining
products was not regulated in the previous versions of the PBI and the SEBI.
Courier Service Companies and Oil and Gas Exports
If export is conducted through a courier, the obligations relating to receipt of foreign exchange
export proceeds adhere to the owner of the goods. The courier company must provide PEB
information to the owner of the goods.
For exports of oil and gas, the obligation to report receipt of foreign exchange export proceeds
adheres to the exporter and/or the parties in the oil and gas contract.
Obligation to Withdraw Foreign Exchange Offshore Loans
Debtors are obliged to withdraw offshore foreign exchange loans through a foreign exchange bank.
The obligation applies to all cash loans that derive from non-revolving loan agreements that are not
used for refinancing, facility margin between refinancing and previous offshore loans and debt
securities in the form of bonds, medium term notes, floating rate notes, promissory notes and
commercial paper.
The withdrawal of offshore foreign exchange loans shall be reported to BI along with supporting
documents no later than the 15th day of the following month.
Sanctions
Subject
Exporters who violate the requirements on receipt of
foreign exchange export proceeds through a foreign
exchange bank and its due date
Debtors of offshore loans who violate the obligation
to withdraw through a foreign exchange bank
Foreign exchange loan rapporteur who is late to
submit supporting documents to BI

Sanctions
Fine 0.5% of the nominal value of the export
proceeds up to IDR 100 million. Failure to pay the
fine, exporters will be suspended from exporting.
Fine 0.25% for every withdrawal that is not made
through a foreign exchange bank up to IDR 50 million.
Fine IDR 500,000 /day

 Transitional Provisions
Foreign exchange export proceeds resulting from PEB issued until the end of May 2014 are still
governed by PBI No. 14/25/PBI/2012 and SEBI No. 15/9/DSM.
Withdrawal of offshore loans signed prior to January 2, 2012, may be conducted other than through
a foreign exchange bank.
October 15, 2014
ARFIDEA KADRI SAHETAPY -ENGEL TISNADISASTRA
Disclaimer:
The foregoing material is the property of AKSET and may not be used by any other party without prior written
consent. The information herein is of general nature and should not be treated as legal advice, nor shall it be
relied upon by any party for any circumstance. Specific legal advice should be sought by interested parties to
address their particular circumstances.