Attachment 7. Regulation of Director General for Forestry Business Development
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1 Attachment 7. Regulation of Director General for Forestry Business Development Number : P.5/VI-BPPHH/2014 Date : 14 July 2014 Concerning : Standards and Guidelines for Performance Assessment of Sustainable Production Forest Management and Timber Legality Verification A. S C O P E GUIDELINE FOR THE ISSUANCE OF V-LEGAL DOCUMENT This Guideline covers references, definitions, application procedures, issuance, extensions, replacements and cancellations as well as publications and reporting of the issuance of V-Legal Documents for ETPIK (Registered Exporter of Forestry Industrial Products) or ETPIK Non Producers (Registered Exporter of Forestry Industrial Products Non-Producers) that already has Timber Legality Certificate (S-LK), general requirements, form specifications, and the sending of signatures and seal specimens, forms format, and guideline for form filling in. B. REFERENCES 1. Regulation of Minister for Forestry Number P.40/Menhut-II/2010 Jo. Number P.33/Menhut II/2012 concerning Organization and Working System of the Ministry for Forestry. 2. Regulation of Minister for Forestry Number P.30/Menhut-II/2012 concerning the Administration of Forest Productss derived from Private Forest. Regulation of Minister for Trade No. 64/M-DAG/PER/10/2012 as amended by Number 81/M-DAG/PER/12/2013 concerning the Export Stipulation on Forestry Industrial Products. This translation is done by professional translator and proofreaded by Multistakeholder Forestry Programme Team. The document is uploaded to per 30 November Should you have revision or suggestion to the text please mfp@mfp.or.id.
2 3. Regulation of Minister for Forestry Number P.18/Menhut-II/2013 concerning Information on Timber Legality Verifications through Timber Legality Information System (SILK) and the Issue of V-Legal Document. 4. Regulation of Minister for Forestry Number P.41/Menhut-II/2013 concerning the Administration of Timber Forest Productss derived from Natural Forests. 5. Regulation of Minister for Forestry Number P.42/Menhut-II/2014 concerning the Administration of Timber Forest Products derived from Timber Crops Forest in Production Forest. 6. Regulation of Minister for Forestry Number P.43/Menhut-II/2014 concerning Performance Assessment for Sustainable Production Forests Management and Timber Legality Verifications to Permit Holder or Private Forest. 7. Decree of the Minister for Forestry Number SK. 641/Menhut II/2011 concerning V-Legal Sign Decision. 8. Decree of the Minister for Forestry Number SK. 418/Menhut II/2012 concerning Information System on Timber Legality Verifications. C. DEFINITION 1. V-Legal Document is the document stating that timber products for export purposes have met the verification standards of timber legality and with the stipulations of the Government of the Republic of Indonesia. 2. Timber Product is the product of processed results of timber Forest Products. 3. Assessment Body and Verification Body hereinafter referred to as LP&VI is an Indonesian legal body which is accredited by KAN (National L 7-2
3 Accreditation Committee) to implement performance assessment for Sustainable Production Forest Management (PHPL) and/or timber legality verification. 4. Verification Body of Timber Legality (LVLK) is LP&VI which performs the timber legality verification (LK). 5. The Online System of Timber Legality Information hereinafter referred to as Online SILK is the information system functioning as SVLK information center and media of V-Legal Document issuance. 6. Timber Legality Verifications Information Unit/License Information Unit (LIU) is the unit managing timber legality verifications information domiciled in the Ministry of Forestry and having the duty to handle the preparation of materials for policy formulation, implementation of policy, technical guidance and evaluation of implementation of technical guidance in information and legality verifications license. 7. Timber Legality Information System Manager is the competent authority having the authority to manage SILK Online. 8. Registered Exporter for Forestry Industrial Products (ETPIK)) is the forestry industrial company which has the recognition to do the exporting of forestry industrial products. 9. Non Producer Registered Exporter of Forestry Industrial Products (ETPIK Non Producer) is the trading company which has the recognition to do the exporting of forestry industrial products. 10. Timber Legality Certificate (S-LK) is the certificate granted to the permit holder, management right holder, private forest owner, ETPIK non L 7-3
4 producer, home industry/craftsman, which stated as has met the timber legality standards. 11. Verification of the issuance of V-Legal Document hereinafter in this Regulation referred to as verification is a continued control activity in a certain period for V-Legal Document issuance performed by LVLK to ETPIK and ETPIK Non Producer who have Timber Legality Certificate. 12. Product Sample is the sample in physically form and/or photograph/technical drawing/sketch of products to be exported. 13. Auctioned timber is the Forest Products timber from auctions derived from confiscation, finding and seizure. D. PREPARATION ON V-LEGAL DOCUMENT ISSUANCE 1. Request for Verification a. ETPIK or ETPIK Non Producer registers the responsible official in submission/sign Request for V-Legal Document Issuance to LVLK, proved with a Decision Letter or Power of Attorney by the Company s Manager stated in the Notarial Deed. b. ETPIK or ETPIK Non Producer submits request for V-Legal Document issuance to LVLK which issues respective S-LK by filling-in the Request form for the issue of V-Legal Document attached with copy of packing list and/or copy of invoice of the goods to be exported. 2. Verification of Issue of V-Legal Document for ETPIK a. ETPIK delivers copy of document of the LMK (Timber Mutation Report) or report of stock, document/list of products order and raw materials supply document related to timber and timber products to L 7-4
5 be exported, yield, and if needed in the form of product sample for export purposes to be verified by LVLK. b. LMK Documents or stock report delivered to LVLK every month. LMK or stock report sent for the first time shall be recorded as initial stock in timber balance and in the following months shall be used for timber stock balance adjustment after performing cross check with raw materials supply document. In case there are differences between the data in LMK or stock report with raw materials supply document, the LVLK requests clarification in advance and if needed may carry out physical checking by sampling. c. Recapitulation of raw materials supply document shall be delivered to LVLK regularly to update data on supply of timber stock balance and/or to deliver copy of realization of industrial raw materials fulfillment to LVLK for industries who have performed the RPBBI online. d. In case needed, LVLK may request respective documents directly such as Log Legal Certificate (SKSKB) and/or Bill of Log Transportation (FA-KB) and/or Bill of Processed Timber Transportation (FA-KO) or Certificate of Origin (SKAU) of timber, Nota or Covering Letter and/or Notice on Imported Goods (PIB) completed with certificate of origin of timber or timber products accompanied with certificate of harvesting country of origin. Recapitulation of raw materials supply document has to state the information of timber species. L 7-5
6 e. In verification of V-Legal Document issuance, LVLK may carry out physical checking with sampling method towards exported products. f. LVLK makes timber stock balance which contains sufficiency of supply volume and the use of raw materials by paying attention to yield factor in production process. Timber stock balance is used as a basic data for verification of V-Legal Document issuance. 3. Verification of V-Legal Document Issuance for ETPIK Non Producer a. ETPIK Non Producer send the LMK copy or report of monthly stock of all suppliers industries to LVLK. b. ETPIK Non Producer send the Transport Nota/covering letter of products purchased derived from the suppliers industries to LVLK. c. ETPIK Non Producer reports the stock of products monthly. Report of the stock products sent for the first time shall be recorded as the initial stock in products balance which in the following months shall be used for the adjustment of stock products balance after cross checked with Transport Nota/ covering letter of products purchased. d. In performing verification for V-Legal Document issue, LVLK may carry out physical checking by sampling towards exported products. e. LVLK makes products stock balance which contains sufficiency of supply volume and deduction of product. Products stock balance is used as the basic data for verification of V-Legal Document issuance. E. THE ISSUANNCE OF V-LEGAL DOCUMENT 1. Mechanism of V-Legal Document Issuance through SILK Online a. For ETPIK or ETPIK Non Producer which verification result of V-Legal Document issue is stated as QUALIFIED, then LVLK shall issue the L 7-6
7 V-Legal Document at the latest of 3 (three) days as of the receipt of request and the fulfillment of requirements completely. In case physical checking is required then LVLK shall issue V-Legal Document at the latest 2 (two) days after the finalization of physical checking. b. In case the verification result of V-Legal Document issue is stated as UNQUALIFIED, then LVLK shall not issue V-Legal Document and LVLK shall make Nonconformity Report submitted to ETPIK or ETPIK NON Producer and the Director General. c. LVLK shall submit the Nonconformity Report to the Director General through Information Unit of Timber Legality Verifications at the latest of 24 (twenty four) hours as of the decision was made. d. LVLK publishes the public summary concerning the issuance of V- Legal Document and Nonconformity Report, and reports to the Director General every 3 (three) months with a copy to KAN, Director General for Foreign Trade Ministry of Trade and Director General of Agro Industry Ministry of Industry. e. ETPIK or ETPIK Non Producer delivers copy of PEB at the latest of 30 (thirty) calendar days as of the issuance date of V-Legal Document. f. The V-Legal Document which cannot be assured its usage within 30 (thirty) calendar days as of the date of issue due to PEB copy was not sent to LVLK, then the service of V-Legal Document issuance shall postponed until the ETPIK or ETPIK Non Producer submits the PEB report as required. L 7-7
8 g. The PEB Report which has been submitted to LVLK has to be reported in PEB Recapitulation Report at the latest on the 10 th every month to Information Unit of Timber Legality Verifications. h. LVLK shall keep all documents received for a minimum of 4 (four) years. In case there is a change of LVLK, then the documents are to be moved to the next LVLK and shall be reported to the Ministry of Forestry. i. In the event the accreditation and/or the establishment of an LVLK is frozen or revoked, then the Director General on behalf of the Minister shall decide for one of the LVLKs to temporarily replace it until the finalization process of certification transfer. 2. Mechanism of V-Legal Documents issuance manually a. In the event the Timber Legality Information System is not functioning due to force majeure, then the LVLK may issue V-Legal Documents manually. b. Force majeure situation as referred to in point (a), may be in the form of: 1) Natural disasters such as flood, earthquake, landslide, other natural disasters which happen naturally, and/or 2) Fire, blackout and stolen of equipment and/or 3) Damage and the non-functioning of means and infrastructure of supporting application system of Timber Legality Information System for more than 4 (four) hours. c. Force majeure situation in the form of natural disaster as referred to in point (b) item 1) shall be stated by the competent authority, while L 7-8
9 fire and damage as referred to point 2) item b and c, through a circular letter of Director of Forest Products Processing and Marketing Development and shall be submitted to LVLK, Inatrade, INSW and competent authority in the country of destination. d. The issuance of V-Legal Documents as referred to in point (a) is to be made by filling-in the V-Legal Document intended for manual publicity (marked by MANUAL stamp on the up right side). e. The filling-in may be done by handwriting, typewriter or other electronic equipment. The V-Legal Document shall be signed by the official authorized by LVLK affixed with LVLK stamp. Said official is the official whose signature specimen has been submitted to Information Unit of Timber Legality Verifications. f. V-Legal Documents in manual form which have been issued by LVLK submitted to LIU, Inatrade and INSW. g. When a force majeure situation is ended which is to be informed through a circular letter and/or electronic information by competent authority, then the issue of V-Legal Document manually shall be no longer valid. h. After the re-functioning of SILK online, LVLK is responsible to make entry of V-Legal Documents that have been made manually. 3. V-Legal Document is not permitted to be issued for the productions derived from auctioned timber. F. EXTENTION OF V-LEGAL DOCUMENT 1. In the event of force majeure or other valid reasons out of the control of ETPIK or ETPIK Non Producer occurred after the products passed by the L 7-9
10 Indonesian customs, the LVLK may extend the validity of V-Legal Document for 2 (two) months at the most. 2. ETPIK and ETPIK Non Producer submits request for extension of validity of V-Legal Document which contains reasons of extension completed with attachment of V-Legal Document 5 th sheet. 3. LVLK performs verification towards the validity of reasons for said extension. 4. After the verification, LVLK extends the validity of V-Legal Document at the latest 3 (three) days as of the receipt of the request and the reasons of force majeure happened as well as other valid reasons and they are reported to LIU. 5. Extension of V-Legal Document shall contain the same information and references with the V-Legal Document to be extended, and to be written Validated On in box 18 and to be reported to LIU. 6. In the event the verification results on the correctness of extension reasons are not accepted, then LVLK shall not extend the validity of V-Legal Document. G. REPLACEMENT OF V-LEGAL DOCUMENT DUE TO LOST OR DAMAGED 1. In the event of damaged or lost on the 1 st Sheet and/or 2 nd Sheet of the V- Legal Document, the ETPIK or ETPIK Non Producer or its Official Representative may submit request for V-Legal Document replacement by writing a letter of request for V-Legal Document replacement which contains reasons for replacement by enclosing the 5 th sheet of V-Legal Document. L 7-10
11 2. LVLK performs verification on the correctness of reasons for said replacement. 3. After performing verification, and the reasons for replacement can be accepted, then LVLK shall issue replacement of V-Legal Document at the latest of 24 (twenty four) hours as of the receipt of request for replacement and reporting it to LIU. 4. Replacement of V-Legal Document has to contain the same information and references with the replaced V-Legal Document, and is written Replacement License in box 18 and reported to LIU. 5. With the issuance of V-Legal Document replacement, then the lost/damaged V-Legal Document is stated as no longer valid. 6. In the event the verification results on the correctness of reasons for said replacement unaccepted, then the LVLK shall not replace said V-Legal Documents. H. CANCELLATION OF V-LEGAL DOCUMENT 1. In the event of failure in exportation, ETPIK and ETPIK Non Producer shall report immediately to LVLK to cancel the V-Legal Document by mentioning the reasons of cancellation and to enclose V-Legal Document Sheet 1 st, 2 nd, 3 rd, 5 th and 7 th. 2. In case the goods exported lost or damaged before reaching the destination country, then V-Legal Document Sheet 1 st, 2 nd, 3 rd, and 5 th are to be returned to LVLK. 3. LVLK performs verification on the correctness of failure in exportation. 4. In case the verification results stated that there has been a failure of export, then LVLK cancelled the V-Legal Document at the latest of 3 (three) L 7-11
12 days as of the receipt of cancellation report and makes a report to LIU and Indonesia customs authority. 5. In the event the verification results stated that there has been no export failure, then LVLK shall not cancel the V-Legal Document. I. COST TO ISSUE V-LEGAL DOCUMENT The cost to issue V-Legal Document through verification charged to EPTIK or EPTIK Non Producer. J. GENERAL REQUIREMENTS OF V-LEGAL DOCUMENT 1. V-legal Document and attachments of V-Legal Document are in the form of paper and/or electronic. 2. The filling-in of V-Legal Document is in English, all in capital characters except for writing species name, through filling-in of all parts (tamper proof) is in such a way so there is no chance to fill-in other than by LVLK. Erasing, correction, or changes are prohibited. 3. Guidance to fill-in V-Legal Documents is as attached (R). 4. V-Legal Document signed (may be electronically signed) by LVLK appointed official and affixed with LVLK stamp by using ordinary stamp or embossed stamp or perforated stamp. 5. In the event the filling-in for exported products is not sufficient in box 9, then the V-Legal Document is to be completed with the enclosures of information or products detailed information which covers commercial description, HS Code, common and scientific name, harvest country and ISO code for harvest country. L 7-12
13 6. Enclosed documents become a unity with V-Legal Document with same specifications as V-Legal Document, signed and stamped as V-Legal Documents. 7. V-Legal Document in electronic form sent by LVLK to SILK Online to be forwarded to (a) INATRADE system in the Ministry of Trade, (b) Indonesian Customs Authority through the system of Indonesia National Single Window (INSW) and if needed to (c) the competent authority of export destination country. K. SPECIFICATION OF V-LEGAL FORM 1. The V-Legal Form and V-Legal Document Attachment Form are using A4 paper standard size, printed by using the same format as attachment Q with embossed V-Legal Sign as well as watermark. 2. V-Legal Document in paper form is to be made in 7 (seven) copies, with allotment as follows: a. 1 st Sheet (white), for competent authority of destination country. b. 2 nd Sheet (yellow), for customs of destination country. c. 3 rd Sheet (white), for importer. d. 4 th Sheet (white), for LVLK. e. 5 th Sheet (white), for exporter. f. 6 th Sheet (white), for Information Unit of Timber Legality Verifications. g. 7 th Sheet (white), for Indonesian Customs. 3. The 1 st and 2 nd Sheet of V-Legal Document submitted by ETPIK/ETPIK Non Producer to Importer in the discharge port of destination country, together with other documents related to shipping/export-import. L 7-13
14 L. THE SENDING OF SIGNATURE AND STAMP SPECIMEN 1. LVLK send the list of officials signing the V-legal Document, together with specimen of the signatures of the officials and LVLK stamp to the Information Unit of Timber Legality Verifications (LIU). 2. The Information Unit of Timber Legality Verifications (LIU) may supply information on list of officials who sign the V-Legal Document together with their signatures and the LVLK stamp to the Director General of Customs Ministry of Finance and competent authority of export destination country when requested. DIRECTOR GENERAL. Signed BAMBANG HENDROYONO Made as true copy HEAD OF LEGAL AND TECHNICAL COLLABORATION DIVISION Signed IMAM SETIOHARGO L 7-14
15 GUIDELINES FOR FILLING-IN THE V-LEGAL FORM Item A : Export Destination Country. In the event the export destination country is a member of the European Union, then it shall be filled in EUROPEAN UNION. Item B : Collaboration Scheme. To be filled in according to the collaboration scheme with importer country (Export Destination Country), or to be ignored when there is no collaboration scheme. In the event the export destination country is a member of the European Union, then it shall be filled in FLEGT. Box 1 : Issuance Authority. To be filled-in with name, address, and number of LVLK accreditation. Box 2 : Importer. To be filled-in with address of importer, name and code ISO for export destination country, loading and discharge port, as well as export value. For sheet 1,2, and 3 of V-Legal Document the export value is not to be stated. Box 3 : V-Legal Document Number (Permit number). To be filled-in with sample of numbering as follows: ID-GB Note: 00 : Year of issue (last two digit) : Document sequence number which is issued for those who own S-LK (five digit), starting from L 7-15
16 : S-LK Number (five digit) and LVLK accreditation number (three digit) ID : Code ISO for Indonesia (two characters) GB : Code ISO for export destination country (two characters) Box 4 : The date of permit validity ended. To be filled-in with two digit of date, two digit of month, and four digit of year. Box 5 : Exporter country. To be filled-in with INDONESIA Box 6 : ISO Code for Exporter Country. To be filled-in with ID as the ISO code for Indonesia. Box 7 : Transportation Means. To be filled-in with information on transportation means in export point. Box 8 : Exporter. To be filled-in with name and address of exporter, including ETPIK or ETPIK Non Producer and Taxpayer Registration Number (NPWP). Box 9 : Commercial Description. To be filled-in with commercial description of timber products. Description has to be sufficiently detailed for HS classification. Box 10 : HS Code. To be filled-in with 10 (ten) digit of commodity code based on Commodity Description of Harmonized and System Coding (HS Code) that is to be found in Tariff Book of Indonesian Customs. In the event there is a collaboration scheme with export destination country, HS Code of V-Legal Document for Sheet 1, 2 L 7-16
17 1nd 3 are to be filled-in according to collaboration scheme stipulations.. Box 11 : Common and Scientific Name. To be filled in with common and scientific name of timber species used in the products. In the event there are more than one species in a composite product, use separate line as separator. For the composite product or component that contains some species, it is sufficient to write down name of dominant species. Box 12 : Harvest country. To be filled in with name of the country where the species referred to in Box 11 harvested, including for all timber resources used in the composite products. Box 13 : ISO Code for Harvest Country. To be filled in with code ISO for countries stated in Box 12, use semicolon (;) as separator. Box 14: Volume (m3). To be filled-in with maximum volume limit of the whole in cubic meter (four digit decimal). For V-Legal Document which consists of several HS types, the volume of each HS has to be described. Box 15 : Net Weight (Kg). To be filled-in with total weight in shipment during measuring in kilogram (two digit decimal). This is to be defined as the net weight of timber products without direct container or whatever packing, except bearer, spacer, sticker etc. For V-Legal Document which consists of several HS types, the weight of each HS is to be described. L 7-17
18 Box 16 : Total Unit. To be filled in with total unit becomes the best measuring type for a product. May be ignored. For V-Legal Document which consists of several HS types, the total unit of every HS has to be described. Box 17 : Sign. To be filled-in with security code and may be added with other appropriate notes. Number of invoice to be filled-in in this box. Box 18 : Signature and Stamp. Signature of competent authority and stamp are according to stipulation. To be filled-in with complete name of authority as well as place and date. L 7-18
19 REQUEST FORM FOR THE ISSUE OF V-LEGAL DOCUMENT <Letter Head> Subject: Request for V-Legal Document Issue To <Name of LVLK> (Place of Domicile) Herewith we are requesting for the issue of V-Legal Document for: Name of Company : ETPIK No. :. Tax Registration No. (NPWP) :. S-LK No. :.. Name of Importer :.. Address of Importer :.. Destination Country : <country code> - <name of country> Loading Port : <port code> - < name of port>. Discharge Port : <port code> - < name of port>. Transportation Means : <land/sea/air transportation>... Total Unit :.. Unit L 7-19
20 Total Volume 1) :.. m3 Total Weight 1) :.. kg Total Value 2) :.. USD Invoice No. :.. Date of Invoice :.. Date of Stuffing Plan :.. Place of Stuffing : Other information 5) : With details of Request 3) : a. HS No. :. Details of Goods :. Species 4) : <name of species>. Harvest country 4) :... <country code> <name of country> Unit :.. Unit Volume 1) :.. m3 Weight 1) :.. kg Value 2) :. USD Note :. L 7-20
21 b. HS No. :. Details of Goods :. Species 4) : <name of species>. Harvest country 4) :...<country code> - <name of country Unit :.. Unit Volume 1) :.. m3 Weight 1) :.. kg Value 2) :. USD Note :. c. Thus the request letter of V-Legal Document issue with true information. <Place, Date> <Signature of Responsible Person and Company Stamp> 1. contains in accordance with attachment 7 of guidelines for issue of V-Legal Document. 2. value in f.o.b 3. in accordance with total details of goods to be exported 4. may be more than one, use separate lines as separator. Fill in with other information which is to be inserted in box 17 of V-Legal Document according to requirements, such as: Invoice number, Packing List. L 7-21
22 FORM OF INCONFORMITY REPORT REPORT OF INCONFORMITY VERIFICATION RESULTS FOR V-LEGAL DOCUMENT ISSUE (Number of Inconformity Report) 1. LVLK Identity: a. Name of Institution : b. Accreditation Number : c. Address : d. Telephone/Fax No. : e. f. Verification Responsible Person : 2. Identity of ETPIK or ETPIK Non-Producer: a. Name of Permit Holder : b. Number & Date of ETPIK or ETPIK Non Producer: c. Capacity of Permit : d. Address of factory : e. Telephone/Fax/ Number : f. Responsible Person : 3. Report of Inconformity Based on the results of verification/on IUIPHHK/IUI Continuation/TDI on (time).., an inconformity is found in the Forest Products in invoice as follows:. L 7-22
23 * fill in the reasons and justifications.... on the inconformity.. Responsible Person (Name of Responsible Person) NIP Time of Signing: Number of Inconformity Report to be filled in as guidance of V-Legal Document number. L 7-23
24 FORMAT OF PUBLIC SUMMARY FORM 1. LVLK Identity: PUBLIC SUMMARY OF V-LEGAL DOCUMENT ISSUE a. Name of Institution : b. Accreditation Number : c. Address : d. Number of telephone/fax : e. f. Responsible Person of AND INCONFORMITY REPORT MONTH.. YEAR.. (Number of Public Summary Report) Institution : 2. Summary on V-Legal Document Issue and Inconformity Report No. Auditee Number of Verification Result Request for V-Legal Total Qualified Total Non- Document Qualified Total Auditee : Total Number of Request : Total V-Legal Document Issue : Total Inconformity Report Issue : Number of Public Summary Report to be filled in as guidance of V-Legal Document number with the following sample: 00.JAN-MAR.001/RKP L 7-24
25 (L7-14 already in English) (L7-15 already in English) (L7-16 already in English) (L7-17 already in English) (L7-18 already in English) (L7-19 already in English) (L7-20 already in English) L 7-25
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