LEGAL PERPSECTIVE ON THE TRADE FACILITATION … · Abstract: The application of trade facilitation...

Petita, Volume 1 Nomor 1, April 2016 http://jurnal.ar-raniry.ac.id/index.php/petita/index

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LEGAL PERPSECTIVE ON THE TRADE FACILITATION AGREEMENT (TFA): INDONESIA CASE STUDIES

Ozy Diva Ersya

Ph.D Student in International Law University of Nottingham, United Kingdom

Email: [email protected]

Abstrak: Penerapan regulasi tentang fasilitasi perdagangan internasional (TFA) dalam sistem hukum Indonesia memerlukan kajian lebih lanjut dan komprehensif. Selama ini indonesia belum meratifikasi persetujuan tentang TFA. Disatu sisi secara hukum internasional TFA harus diterapkan oleh suatu negara, akan tetapi masih banyak negara yang belum menerapkan TFA sebagai instrumen hukum di negaranya. Akibat dari kekosongan hukum tentang TFA banyak negara yang enggan menanamkan investasinya di Indonesia. Padahal TFA telah sejalan dengan program-program negara ASEAN. Karena pada intinya program TFA mempunyai tujuan sama yaitu mempercepat pertumbuhan ekonomi melalui percepatan pergerakan barang dan jasa dengan memperkuat pondasi hukum TFA. Sejauh ini WTO TFA dapat dipergunakan sebagai dasar hukum tak mengikat dalam sistem hukum Indonesia. Karena walau bagaimanapun pada suatu waktu WTO TFA bisa dijadikan kepastian hukum di tingkat internasional.

LEGAL PERPSECTIVE ON THE TRADE FACILITATION AGREEMENT (TFA): INDONESIA CASE STUDIES

Abstract: The application of trade facilitation needs further analyses in the context of Indonesian’s law. So far Indonesia does not yet ratify the trade facilitation agreement. In one hand the trade facilitation is a compulsory requirement that must be fulfilled by a state, in other hands the state does not provide a legal instrument. The consequence is legal uncertainty to those parties who want to invest their money in Indonesia. The trade facilitation will also in line with ASEAN programs. Those programs have same purposes to fasten the movement of goods and services by providing legal certainty on trade facilitation foundations. The WTO TFA can be used as ‘soft-law’ for Indonesian legal framework to apply trade facilitation enhancement, although it is not yet ratified by Indonesia. The WTO TFA will easily appropriate and have legal force if the implementation of the WTO TFA into Indonesian national legal structure is also noticeable.

Keyword: trade facilitation, legal perspective, ASEAN programs


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Introduction

The activities of trade facilitation agenda in global trade has been proposed

greatly at the international level, such as at the WTO, the WCO, OECD, UNCTAD,

UN/CEFACT, UN/ECE, the World Bank, ITC, UNCITRAL, IMO, and ICAO, etc.; at regional

level, such as NAFTA, APEC, European Union, and other FTAs; and at Non-

Governmental Organisations (NGOs) level, such as IATA, ICS, IRU and the ICC (Staples,

1998; Grainger, 2011, 2012, 2014; Mustra, 2011).1 At international level, the WTO is

the only multilateral trade organisation, with 164 members and autonomous customs

agencies, which deals with global rules of trade. Generally known, developing

countries and LDCs represent two-thirds of the WTO members.

Awareness of how to reduce unnecessary trade costs at the border and

introduce certain elements of trade facilitation, by concluding such a multilateral

agreement on trade facilitation, in order to tackle the costs, has become a significant

part of prolonged discussion within the WTO Doha Round Negotiations (Duval, 2007;

Scott and Wilkinson, 2011; Ismail, 2008; Wilkinson, 2006, 2009)2, particularly the

implementation-related issues and concerns (Finger and Wilson, 2007)3 and a

discussion of needs, priorities, and costs associated for making provision of technical

assistance and capacity building of a developed countries and donors for developing

countries in the implementation (Finger, 2008; McLinden, 2006).4 A number of

1Brian Rankin Staples, ‘Trade Facilitation’ (October 19, 1998. Draft), Andrew Grainger, ‘Trade

Facilitation: A Conceptual Review’ (2011) Journal of World Trade 39-62, Andrew Grainger, ‘Trade Facilitation’ in Kenneth Heydon and Stephen Woolcock (eds), The Ashgate Research Companion to International Trade Policy (Ashgate Publishing 2012), Andrew Grainger, ‘The WTO Trade Facilitation Agreement: Consulting the Private Sector’ (2014) 48(6) Journal of World Trade 1167-1188, Monica Alina Mustra, ‘Chapter 3: Border Management Modernization and the Trade Supply Chain’ in Gerard Mclinden, Enrique Fanta, David Widdowson, and Tom Doyle (eds), Border Management Modernization (The World Bank 2011).

2Yan Duval, ‘Trade Facilitation Beyond the Doha Round of Negotiations’ (2007) Asia Pacific Research and Training Network on Trade, Working Research Series no. 50, James Scott and Rorden Wilkinson, ‘The Poverty of the Doha Round and Least Developed Countries (2011) 32(4) Third World Quarterly 611-627, Faizel Ismail, ‘An Assessment of the WTO Doha Round July-December 2008 Collapse’ (2009) 8(4) World Trade Review 579-605, Rorden Wilkinson, ‘The WTO in Hongkong: What it really means for the Doha Development Agenda’ (2006) 11(2) New Political Economy 291-304, Rorden Wilkinson, ‘Language, Power and Multilateral Trade Negotiations’ (2009) 16(4) Review of International Political Economy 597-619.

3Joseph Michael Finger and John S. Wilson, ‘Implementing Trade Facilitation Agreement in the WTO: What Makes Sense?’ (2007) 12(3) Pacific Economic Review 335-355

4Joseph Michael Finger, ‘Trade Facilitation: The Role of a WTO Agreement’ (2008) ECIPE Working Research No. 1, Gerard McLinden, ‘Needs, Priorities and Costs Associated with Technical Assistance and Capacity Building for Implementation of a WTO Trade Facilitation Agreement: A Comparative Study Based on Six Developing Countries’ (2006) World Bank Working Research, November, 1-5, 9-35 in Jean-Christophe Maur and John S. Wilson (eds), Trade Costs and Facilitation: Open Trade and Economic Development, Vol II (Edward Elgar Publishing Limited 2011).


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proposals from some of the WTO Members for improved performance have been

tabled and predicted an outlook on the future of the negotiations (Shin, 2001; Finger,

2008; Bolhofer, 2007).5

Trade facilitation agenda in the WTO has been raised as a negotiated discussion

in a multilateral working group, as one of the four, so called “Singapore issues”, the

other three working groups were trade and investment, competition policy, and

transparency in government procurement, at the first WTO Singapore Ministerial

Conference in December 1996. After several years of exploratory work, the WTO

members formally agreed to launch negotiations on trade facilitation on 1 August

2004, on the basis of modalities in Annex D of the work programme of Doha

Development Agenda (DDA) 2001, the so-called “July Package” (Neufeld, 2014).6

However, the understanding of trade facilitation has changed from its initial

description at 1996 Singapore Ministerial as “the simplification of trade procedures”

to a more narrow definition of DDA 2001, which described as “the movement, release

and clearance of goods” (Woo, 2003).7

In the WTO negotiations, the discussion of trade facilitation covers therefore

customs matters with a view to simplifying, modernising, and harmonising the

customs administrations among the WTO Members in order to give benefits for

trading activities. Nevertheless, earlier, the scope of trade facilitation in the

negotiations was being related to other WTO provisions and agreements. Those are:

Agreement on Technical Barriers to Trade, the Application of Sanitary and

Phytosanitary Measures, Import Licensing Procedures, Rules of Origin,

Implementation of Article VII of the GATT 1994 (Customs Valuation), Pre-shipment

Inspection, GATS, Article V (Freedom of Transit), Article VIII (Fees and Formalities

connected with imports and exports), Article IX (Marks of Origin) and Article X

5Yukyun “Harry” Shin, ‘New Round and Trade Facilitation: Proposing a Tentative Draft

Agreement on Trade Facilitation Measures’ (2001) 35(2) Journal of World Trade 229-252, Carolin Eve Bolhofer, ‘Trade Facilitation-WTO Law and its Revision to Facilitate Global Trade in Goods’ (2007) 2(11/12) Global Trade and Customs Journal 385-391.

6Nora Neufeld, ‘The Long and Winding Road: How WTO Members Finally Reached A Trade Facilitation Agreement’ (2014) The WTO Staff Working Research ERSD-2014-06

7Yuen Pau Woo, Trade Facilitation in the World Trade Organisation: Singapore to Doha and Beyond’ 270-279 in Will Martin and Mari Pangestu (eds), Options for Global Trade Reform: A View from the Asia-Pacific (Cambridge University Press 2003)


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(Publications and Administration of trade regulations) of the GATT 1994 (Shin, 1999;

Duval, 2007).8

Until finally, the negotiation was concluded into the WTO Trade Facilitation

Agreement (TFA) at the ninth WTO Ministerial Conference Meeting in December 2013

in Bali, Indonesia. This conference concentrated on three issues: trade facilitation,

Least Developing Countries (LDCs) and agriculture. The WTO TFA became the first

substantial output of the WTO round of Multilateral Trade Negotiations (MTN) and

proof as the survival of the WTO Multilateral Trading System (MTS). The WTO TFA

changes the WTO legal system once it was inserted into Annex 1A and enforceable to

be implemented.9 The WTO members adopted a Protocol of Amendment to insert the

WTO TFA into Annex 1A of the WTO Agreement on 27 November 2014. This is in line

with paragraph 1 of Article X:3 of the Marrakesh Agreement Establishing the World

Trade Organisation (date 15 April 1994 and enter into force 1 January 1994). The

WTO TFA will enter into force once two-thirds of the WTO members have agreed to

ratify the agreement into their domestic laws.

The WTO TFA has three sections: Section I contains provisions for expediting

the movement, release and clearance of goods, including goods in transit, clarifies and

improves the relevant articles V, VIII and X of GATT 1994, and also sets outs

provisions for customs cooperation. Section II contains Special and Differential

Treatment (SDT) provisions that allow developing countries and LDCs to determine

when they will implement individual provisions of the Agreement and to identify

provisions that they will only be able to implement upon the receipt of technical

assistance and support for capacity building. Lastly, section III contains provisions that

establish a permanent committee on trade facilitation at the WTO, require members to

have a national committee to facilitate domestic coordination and implementation of

the provisions of the Agreement.10

However, while waiting to come enter into force or if the WTO TFA fails to

enter into force, it could still form the basis for a primary soft law agreement, even

acting as a precursor to a legally binding treaty instrument for all of the Members

8Yukyun “Harry” Shin, ‘Trade Facilitation and WTO Rules: For a Better Harmonised Customs

System’ (1999) 33(4) Journal of World Trade 131-142 9As per 29 July 2016, Afghanistan has become the 90th WTO member to ratify the WTO TFA.

Available online at <http://www.tfafacility.org/ratifications> accessed 4 August 2016 10Available online at <https://www.wto.org/english/tratop_e/tradfa_e/tradfa_e.htm> accessed

4 August 2016

http://www.tfafacility.org/ratifications

https://www.wto.org/english/tratop_e/tradfa_e/tradfa_e.htm


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(Footer, 2010).11 On the other hand, some scholar argued that the WTO TFA is another

example of form without substance because of its failure to bring reciprocity to bear

on the acceptance of discipline over trade controls and failure to give operational

content within the GATT/WTO legal system to provision of assistance to developing

countries (Finger, 2014).12 Nevertheless, once the WTO TFA enters into force and

developing countries put a lot of resources in the implementation, the WTO TFA has

the potential to reduce total global trade costs by a significant amount and

streamlining the flow of trade across borders and promote economic development and

raise the standards of living in these countries (Hamanaka, 2014; Elms, 2014;

Khanderia-Yadav, 2015).13

The WTO TFA provides flexibility for developing members by allowing them to

accept only the legal obligations they attach as “schedules”. Therefore, the

implementation of trade facilitation through the WTO TFA may vary among one

developing country and LDCs to other developing countries and LDCs. The WTO TFA

takes Special and Differential Treatment (SDT) provisions in order to make the

implementation practicable by introducing a category system that allows each

developing countries and LDCs to check their readiness on each provisions of the WTO

TFA when it comes to the implementation and, if not ready, they may decide what it

needs in terms of related assistance and capacity building support. Therefore, the

obligations in the WTO TFA fall into three categories: Category A, obligations that are

fully mandatory upon entry into force of the agreement, Category B, obligations that

will become mandatory when or if a further condition or commitment occurs, and

11Mary E Footer, 'The (Re)turn to Soft Law in Reconciling the Antinomies of WTO Law’, (2010)

11(2) Melbourne Journal of International Law, 241-276. She argues that the WTO Agreement on Trade Facilitation could be the primary soft law instrument the same as the Information Technology Agreement (ITA), which was formed pursuant to a Ministerial Declaration and adopted at the first WTO Ministerial Conference in 1996. Under the ITA, the WTO members agreed on the basis of a so-called ‘Modalities and Product Coverage’ approach, to eliminate all duties on listed IT products as between themselves. The Draft Consolidated Negotiating Text on trade facilitation was adopted by General Council back in 2004 and subsequently endorsed in Hong Kong Ministerial Declaration in 2005.

12Joseph Michael Finger, ‘The WTO Trade Facilitation Agreement: Form without Substance Again?’ (2014) 48(6) Journal of World Trade 1279–1287.

13Shintaro Hamanaka, ‘World Trade Organization Agreement on Trade Facilitation: Assessing the Level of Ambition and Likely Impacts’ (2014) 9 Global Trade and Customs Journal, Kluwer Law International, 341-351, Deborah Elms, ‘After Bali: What Happens Next with Asian Trade Facilitation’ (2014) 9 Asian Journal WTO and International Health Law Policy 429-444, Saloni Khanderia-Yadav, ‘Implications of the World Trade Organisation’s Agreement on Trade Facilitation for Emerging Economies’ (2015) 12(1) Manchester Journal of International Economic Law 33-58.


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Category C, obligations that are inherently aspirational, or of a soft-law character

(Elliason, 2015).14

Implementing the WTO TFA is another big issue that will hamper every WTO

Members in the future. The devil is in detail. In the WTO TFA, the devil is the

implementation. The cost of implementing trade facilitation through the WTO TFA is

difficult to quantify for two reasons; first, trade facilitation reforms are rarely carried

out independently of other broader policy objectives, such as customs modernization

and secondly, costs may vary considerably depending on the type of trade facilitation

measures considered, such as diagnostic, regulatory, institutional, training, equipment

and infrastructure, awareness-raising, political will and operational details (The WTO,

2015).15 Implementation issues also bring implications, such as legislative,

administrative, and procedural implications (legal framework implications), potential

infrastructure implications, financial and other resource implications, as well as

technical assistance and capacity building requirements (Widdowson, 2005;

Hamanaka, 2014).16

Apart from the WTO TFA, there is actually international treaty which was

intended as a blueprint for modern and efficient Customs procedures in the 21st

century and is assumed to offer projection of trade facilitation agenda and it lies in the

World Customs Organisation (the WCO). It is the International Convention on the

Simplification and Harmonization of Customs procedures (Kyoto Convention),

originally established in 1973 and entered into force in 1974. The Kyoto Convention

contains general provisions and special annexes dealing with customs procedures and

ensures that it can meet the current demands of governments and international trade

needs. The WCO Council adopted the revised Kyoto Convention (RKC) in June 1999

and entered into force on 3 February 2006. The revised Kyoto Convention promotes

trade facilitation and effective customs control through its legal provisions and simply

efficient customs procedures (Staples, 1998; Masserlin and Zarrouk, 2000;

14Antonia Elliason, ‘The Trade Facilitation Agreement-Episode IV: A new Hope for the WTO’

(2015) 14 World Trade Review 661 15 The World Trade Organisation, ’Speeding up Trade: Benefits and Challenges of Implementing

the WTO Trade Facilitation Agreement’ (2015) World Trade Report. Available online at <https://www.wto.org/english/res_e/booksp_e/world_trade_report15_e.pdf> accessed 7 August 2016

16David Widdowson, ‘International Trade Facilitation: The Customs Imperative’ (2005) Research presented at the APEC Workshop on the WTO Trade Facilitation Negotiations, Kuala Lumpur

https://www.wto.org/english/res_e/booksp_e/world_trade_report15_e.pdf


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Widdowson, 2005; Grainger, 2011; Wolffgang and Kafeero, 2014; Khanderia-Yadav,

2015).17

In the WTO negotiations on trade facilitation, there was argument that the WTO

should “give focus to the simplification of trade procedures by concentrating on

customs modernisation” and strengthen the WCO RKC to be more binding, as it is the

single most comprehensive prospect for true international trade facilitation. In this

regard, the WTO should have incorporated the WCO RKC into its structure (Staples,

1998; Masserlin and Zarrouk, 2000). However, the WTO is the only organisation

providing a credible framework for binding commitments in its law through its

Dispute Settlement Mechanism, rather than other international or regional

organisations, particularly the WCO (Masserlin and Zarrouk, 2000; Duval, 2007;

Wolffgang and Kafeero, 2014). Even the WCO RKC tends to be merely as ‘soft-law’,

which are in the forms of recommended practices, and therefore not easy to

implement, these characteristic, diversity and greater flexibility, is very important in

the context of international trade facilitation which involves a number of stakeholders

including states, the private sector, NGOs, international organisations and many others

(Wolffgang and Kafeero, 2014). In relation to the WTO TFA and the WCO RKC, a

comparative study of the two ‘laws’ reveals that the WTO TFA is mainly a reflection of

the WCO RKC provisions, even the very few aspects of the WTO TFA which are not

regulated by the WCO RKC are, in fact, catered by other instruments and

recommendations of the WCO, such as SAFE Framework, and some other WCO Tools

(Wolffgang and Kafeero, 2014).

Discussion

On 31 July 2014, Indonesia had notified the Preparatory Committee the

following provisions of the WTO TFA under Category A, which will be implemented

upon entry into force: Article. 6.3 (Penalty Disciplines), Article.7.1 (Pre-Arrival

Processing), and Article.10.6 (Use of Customs Brokers). However, up to date now,

17Patrick A. Masserlin and Jamel Zarrouk, ‘Trade Facilitation: Technical Regulations and

Customs Procedures’ (2000) Blackwell Publishers, Hans-Michael Wolffgang and Edward Kafeero, ‘Old Wine in New Skins: Analysis of the Trade Facilitation Agreement vis-à-vis the Revised Kyoto Convention’ (2014) 8(2) World Customs Journal 27-38, available at <http://www.worldcustomsjournal.org/media/wcj/-2014/2/WCJ_V8N2_Wolffgang_Kafeero.pdf> accessed 6 August 2016

http://www.worldcustomsjournal.org/media/wcj/-2014/2/WCJ_V8N2_Wolffgang_Kafeero.pdf


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Indonesia hasn’t yet ratified the WTO TFA into their domestic laws. Additionally, scope

of WTO TFA is very narrow, as it only covers about expediting the movement, release

and clearance of goods which aims to clarify and improve relevant aspects on Article V

(Freedom of Transit), Article VIII (Fees and Formalities Connected with Importation

and Exportation) and Article X (Publication and Administration of Trade Regulations).

Those aspects are mostly dealing with Customs works in practice. Moreover,

implementing the WTO TFA in developing countries, particularly Category B and C,

will remain tremendously uncertain since both donor’s and developing countries’

commitment will be tested, and also depend on both a transition period and a

sufficient provision of capacity building and assistance (Elms, 2014). Developing

countries might be reluctant to change their national laws and customs rules and

procedures, not because the changes are unimportant but they might want to

minimise a detrimental impact on business practices and overhaul of their legal

system (Hamanaka, 2014).

In the case of Indonesian legal framework, Indonesia has recently ratified the

WCO RKC into domestic law through Presidential Regulation Number 69 on 7 July

2014. Moreover, Indonesia has also engaged with other countries in ASEAN and APEC

region and concluded some of regional trade agreements (RTAs), for example ASEAN

Customs Agreement, ASEAN Trade in Goods Agreement, ASEAN Economic Community

(AEC) and APEC Trade Facilitation Action Plan. Indonesia had ratified Charter of

ASEAN into domestic law through Law number 38/2008, ASEAN Trade in Goods

Agreement into domestic law through Presidential Regulation Number 2 on 5 January

2010, and ASEAN Agreement on Customs through Presidential Regulation Number

137 on 17 October 2014. Those agreements were basically reached in order to hasten

the movement of goods, services and labours in the region and lied some provisions on

trade facilitation issue. For example, Article 45 (1) of ASEAN Trade in Goods

Agreement gives provisions that ‘Members states shall develop and implement a

comprehensive ASEAN Trade Facilitation Work Programme’. It seems that in some of

RTAs, trade facilitation issue has been included as one of important factor in trade

policy. Additionally, there is an increasing close relationship between the WTO TFA,

international convention, such as the WCO RKC, RTAs and domestic law in terms of


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trade facilitation agenda, but caution is needed in addressing the potential tension

among them (Wang, 2014).18

As mentioned above, up to now, Indonesia has not yet ratified the WTO TFA

into their domestic law. However, as one of the WTO Members, Indonesia had ratified

the Marrakesh Agreement Establishing the WTO through Law Number 7/1994

concerning Ratification of the Agreement Establishing the World Trade Organization.

In April 2016, it was informed that Indonesia will soon ratify the WTO TFA as it is still

in the process of ratification. It is hoped that it can be immediately included in the

Indonesian National Legislation Programme (Prolegnas).19 This needs a political

commitment between government and People’s Representative in order to ratify the

Agreement.

The implementation of the WTO TFA would also correlate to the acceptance as

well as the good faith implementation of the WTO TFA into the national laws of its

members. Preamble of the VCLT, paragraph 4 stipulated that “Nothing that the

principles of free consent and of a good faith and the pacta servanda rule are universally

recognised”. In addition, Article XVI.4 of the WTO Agreement stipulated that “Each

Member shall ensure the conformity of its laws, regulations and administrative

procedures with its obligations as provided in the Annexed Agreements”. Moreover,

when the WTO TFA comes into force, Article 24.2 of the WTO TFA rules that all

provisions of this [WTO TFA] Agreement are binding on all Members, and Article 24.3

rules that Members shall implement this [WTO TFA] Agreement from the date of its

entry into force. Developing country Members and least-developed country Members

that choose to use the provisions of Section II shall implement this Agreement in

accordance with Section II.

Traditionally, Indonesia adopts civil law system in its legal framework and also

covers to, such as, procedures law, contract law, religion law and customary law. The

1945 Constitution of Indonesia, as amended fourth times in 1999, 2000, 2001 and

2001, does not indicate the status of international agreements in domestic law. The

only provision that states ‘International Agreements’ is only stipulated in Article 11

paragraph 1, 2 and 3 which states that ‘(1) President, with the approval of the People’s

18Heng Wang, ‘The Agreement on Trade Facilitation and its Implications: An Interpretative

Persepective’ (2014) 9 Asian Journal WTO and International Health Law Policy 445-476 19Available at<http://www.thejakartapost.com/news/2016/04/13/indonesia-to-ratify-wto-

trade-facilitation-agreement.html> accessed 8 August 2016

http://www.thejakartapost.com/news/2016/04/13/indonesia-to-ratify-wto-trade-facilitation-agreement.html



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Representatives, may declare war, make peace treaties and conclude international

agreements with other countries; (2) President in making other international

agreements that will produce an extensive and fundamental impact on the lives of the

people which is linked to the state financial burden, and/or that will requires an

amendment to or the enactment of a law, shall obtain the approval of the People’s

Representatives; (3) further provisions regarding international agreements shall be

regulated by law.”

Furthermore, International agreements has been enacted into domestic law

under the Indonesian Law Number 24 of 2000. However, the Law again does not

clearly indicate the status of international agreements in domestic law. Article 10 of

the Law Number 24 of 2000 only implies the type of legislation used for ratification of

international agreements and must be made by the Law, with the approval of People’s

Representatives, if it relates to the issues of, namely: (1) political matters, peace,

security and state security, (2) the changes of which affects the territorial sovereignty,

(3) the sovereignty rights of Indonesia, (4) the human rights and the protection of

environment, (4) the formation of the new law, and (5) the loan agreement and grant.

Other subject matters mentioned above are ratified by the Presidential Regulation,

which does not need approval of People’s Representatives.

Similarly, the Law Number 12 of 2011 concerning the formation of making rules of the

Law does not, again, either mention or indicate the legal status or position of

international agreements within the Indonesian legal framework. It is essential to note

that Article 7, paragraph 1, of that Law structures the hierarchy of legal law in

Indonesia. It means that it will bring the status of enforceability and legal binding to all

subjects in Indonesia. Article 7, paragraph 1, stipules types and hierarchy of rules

consists of, namely: the 1945 Constitution of the Republic of Indonesia; People's

Consultative Council Decree; Law; Government Regulation Replacing the Law;

Government Regulation; Presidential Regulation; Province Regulation; and

Regency/Municipality Regulation. The 1945 Constitution of the Republic of Indonesia

is the highest hierarchy of rules making in Indonesia. Therefore, there are two legal

obligations in ratifying international agreements into Indonesian national law:

ensuring its conformity with the 1945 Constitution of the Republic of Indonesia and


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transforming it into national legal framework (Hikmahanto, 2016).20 These obligations

must be carefully performed in order that international agreements really ensure its

harmony with Indonesian constitution, give benefits to national state, and avoid

international hidden intervention towards national sovereignty through international

agreements (Hikmahanto Juwana, 2016).

Conclusion

As mentioned above, in the context of Indonesian legal framework, the

implementation of trade facilitation agenda under international agreements through

the auspices of the WTO TFA must be further analysed in the context of Indonesian

domestic law. It is a question of legal status and enforceability of international

agreements in implementing trade facilitation agenda in Indonesia, with or without

ratification process. Furthermore, the implementation of the agenda might also be in

line with others agenda at the regional and national level, such as the WCO RKC and

ASEAN Trade Facilitation agenda. Those agenda were reached to the same purpose of

the WTO TFA: to speed up the movement of goods by regulating some provisions on

trade facilitation elements.

The WTO TFA might be as ‘soft-law’ within Indonesian legal framework in

implementing trade facilitation reform, with or without ratification instrument. The

WTO TFA will only be applicable and enforceable if the implementation of the WTO

TFA into Indonesian national legal system is also recognisable. In this respect, how the

implementation of the Marrakesh Agreement Establishing the WTO (the WTO

Agreement), the WCO RKC and ASEAN-FTA into Indonesian legal framework or

domestic law should be looked at as a clue, as this is likely to give some clues as to how

implementation of the WTO TFA is likely to proceed in Indonesia.

20Hikmahanto Juwana, ‘Dua Kewajiban Dalam Proses Ratifikasi Perjanjian International:

Kewajiban Memastikan Keselarasan dengan Konstitusi dan Kewajiban Mentransformasikan ke dalam Hukum Nasional’ (2016) Research presented in Legal Workshop at Headquarter of Indonesian Customs in Jakarta


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Bibliography

Andrew Grainger, ‘The WTO Trade Facilitation Agreement: Consulting the Private Sector’ (2014) 48(6) Journal of World Trade 1167-1188.

------------, ‘Trade Facilitation: A Conceptual Review’ (2011) Journal of World Trade 39-62.

------------, ‘Trade Facilitation’ in Kenneth Heydon and Stephen Woolcock (eds), The Ashgate Research Companion to International Trade Policy (Ashgate Publishing 2012),

Antonia Elliason, ‘The Trade Facilitation Agreement-Episode IV: A new Hope for the WTO’ (2015) 14 World Trade Review 661

Blackwell Publishers, Hans-Michael Wolffgang and Edward Kafeero, ‘Old Wine in New Skins: Analysis of the Trade Facilitation Agreement vis-à-vis the Revised Kyoto Convention’ (2014) 8(2) World Customs Journal 27-38.

Brian Rankin Staples, ‘Trade Facilitation’ (October 19, 1998. Draft)

Carolin Eve Bolhofer, ‘Trade Facilitation-WTO Law and its Revision to Facilitate Global Trade in Goods’ (2007) 2(11/12) Global Trade and Customs Journal 385-391.

David Widdowson, ‘International Trade Facilitation: The Customs Imperative’ (2005) Research presented at the APEC Workshop on the WTO Trade Facilitation Negotiations, Kuala Lumpur

Deborah Elms, ‘After Bali: What Happens Next with Asian Trade Facilitation’ (2014) 9 Asian Journal WTO and International Health Law Policy 429-444.

Faizel Ismail, ‘An Assessment of the WTO Doha Round July-December 2008 Collapse’ (2009) 8(4) World Trade Review 579-605.

Heng Wang, ‘The Agreement on Trade Facilitation and its Implications: An Interpretative Persepective’ (2014) 9 Asian Journal WTO and International Health Law Policy 445-476

Hikmahanto Juwana, ‘Dua Kewajiban Dalam Proses Ratifikasi Perjanjian International: Kewajiban Memastikan Keselarasan dengan Konstitusi dan Kewajiban Mentransformasikan ke dalam Hukum Nasional’ (2016) Research presented in Legal Workshop at Headquarter of Indonesian Customs in Jakarta

James Scott and Rorden Wilkinson, ‘The Poverty of the Doha Round and Least Developed Countries (2011) 32(4) Third World Quarterly 611-627.

Joseph Michael Finger and John S. Wilson, ‘Implementing Trade Facilitation Agreement in the WTO: What Makes Sense?’ (2007) 12(3) Pacific Economic Review 335-355


13

Joseph Michael Finger, ‘The WTO Trade Facilitation Agreement: Form without Substance Again?’ (2014) 48(6) Journal of World Trade 1279–1287.

Joseph Michael Finger, ‘Trade Facilitation: The Role of a WTO Agreement’ (2008) ECIPE Working Research No. 1, Gerard McLinden, ‘Needs, Priorities and Costs Associated with Technical Assistance and Capacity Building for Implementation of a WTO Trade Facilitation Agreement: A Comparative Study Based on Six Developing Countries’ (2006) World Bank Working Research, November, 1-5, 9-35 in Jean-Christophe Maur and John S. Wilson (eds), Trade Costs and Facilitation: Open Trade and Economic Development, Vol II (Edward Elgar Publishing Limited 2011).

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Nora Neufeld, ‘The Long and Winding Road: How WTO Members Finally Reached A Trade Facilitation Agreement’ (2014) The WTO Staff Working Research ERSD-2014-06

Patrick A. Masserlin and Jamel Zarrouk, ‘Trade Facilitation: Technical Regulations and Customs Procedures’ (2000)

Rorden Wilkinson, ‘Language, Power and Multilateral Trade Negotiations’ (2009) 16(4) Review of International Political Economy 597-619.

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Saloni Khanderia-Yadav, ‘Implications of the World Trade Organisation’s Agreement on Trade Facilitation for Emerging Economies’ (2015) 12(1) Manchester Journal of International Economic Law 33-58.

Shintaro Hamanaka, ‘World Trade Organization Agreement on Trade Facilitation: Assessing the Level of Ambition and Likely Impacts’ (2014) 9 Global Trade and Customs Journal, Kluwer Law International, 341-351

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Yukyun “Harry” Shin, ‘New Round and Trade Facilitation: Proposing a Tentative Draft Agreement on Trade Facilitation Measures’ (2001) 35(2) Journal of World Trade 229-252.

Yukyun “Harry” Shin, ‘Trade Facilitation and WTO Rules: For a Better Harmonised Customs System’ (1999) 33(4) Journal of World Trade 131-142

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www.wto.org/english/tratop_e/tradfa_e/tradfa_e.htm> accessed 4 August 2016

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http://www.wto.org/english/res_e/booksp_e/world_trade_report15_e.pdf

http://www.wto.org/english/tratop_e/tradfa_e/tradfa_e.htm

LEGAL PERPSECTIVE ON THE TRADE FACILITATION … · Abstract: The application of trade facilitation...

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