MAJOR CONSUMER PROTECTION LAW ENFORCEMENT AND CONSUMER ISSUES HIGHLIGHTS IN INDONESIA ASEAN Seminar on Cooperative Approaches on Consumer Protection Bangkok 27 – 29 August 2012

DIRECTORATE GENERAL OF STANDARDIZATION AND CONSUMER PROTECTION

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SURVEILLANCE CHALLENGES

1. Indonesia comprises of 17.508 islands and 80.000 km coast line. Let alone the country has 4 land border with Malaysia, Brunei, East Timor and PNG, as well as having a close proximity sea border with countries namely Singapore and Malaysia. The vast territorial area and long borders will create more needs on financial and human resource to support current market surveillance system.

2. With the increase numbers of FTA and MRA between Indonesia with its trade counterparts, the flow of imported goods also increase . This has become another challenge on market surveillance area.

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ACT NO. 8 YEAR 1999 RE CONSUMER PROTECTION

GOVERNMENT DECREE NO. 102 YEAR 2000 RE NATIONAL STANDARDIZATION

GOVERNMENT DECREE NO. 58 YEAR 2001 RE ESTABLISHMENT AND SUPERVISION OF CONSUMER PROTECTION IMPLEMENTATION

MINISTER OF TRADE DECREE NO. 19/M-DAG/PER/5/2009 RE REGISTRATION OF MANUAL BOOK AND AFTER SALE WARRANTY CARD IN INDONESIAN

LANGUAGE FOR TELEMATICS AND ELECTRONIC PRODUCTS

MINISTER OF TRADE DECREE NO. 20/M-DAG/PER/5/2009 RE RULES AND PROCEDURES FOR SUPERVISION OF GOODS AND SERVICES

MINISTER OF TRADE DECREE NO. 14/M-DAG/PER/3/2007 RE STANDARDIZATION ON SERVICES AND MARKET SURVEILANCE FOR INDONESIAN MANDATORY

STANDARD OF GOODS AND SERVICES

RELATED REGULATIONS

LAWS ON SURVEILLANCE

MINISTER OF TRADE DECREE NO. 22/M-DAG/PER/5/2010 RE AMENDMENT TO MINISTER OF TRADE DECREE NO. 62/M-DAG/PER/12/2009

RE LIABILITY OF LABELLING ON GOODS

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In accordance with the Consumer Protection Law, the Government especially the Ministry of Trade is assigned to coordinate the implementation of consumer protection in Indonesia with regard to Development and Supervision.

General Policy :

• Making regulation oriented on protecting consumer and creating legal certainty for the business

• Intensifies surveillance on traded goods and services comprises of 6 parameters (standards, label, advertisement, trade practices, after sales services, standard clause)

• Enhance consumer education in order to create smart and independent consumer as well as actively participate in consumer protection activities, and increasing consumer awareness on self rights and responsibilities

• Strengthening Consumer Protection Institutions. Indonesia has 3 consumer protection institutions, namely: the National Consumer Protection Agency (NCPA), NGO on Consumer Protection and Consumer Dispute Settlement Body (CDSB).

GENERAL POLICY CONSUMER PROTECTION

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GOVERNMENT

NGOs on Consumer Protection

SOCIETY

SURVEILLANCE AUTHORITY

Surveillance in Indonesia is implemented throught 3 different groups: • Government: pre-market, post market and law enforcement • Society/consumers : post market (results are reported to the

Government) • NGOs on Consumer Protection : post market (may be together with

competent authority)

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SURVEILLANCE SYSTEM

Integrated surveillance system is being conducted cohesively with relevant ministries and institutions:

Processed Food products, cosmetics, medicine and medical devices coordinated by the National Agency of Drugs and Food Control (NA-DFC)

Non food products coordinated by the Ministry of Trade

Legal Metrology coordinated by the Ministry of Trade

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EVALUATION OF SURVEILLANCE RESULTS

Law Enforcement (Reprimand Letter, Recall, Investigation) Revision of rules and regulations (ex : Label, Manual Book and after Sales Warranty Card)

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CURRENT CONSUMER PROTECTION ISSUES

1. To protect consumers from purchasing goods that are not in accordance with the sale and purchase agreement – the Case of Dental Unit.

2. Distribution of Goods which is not in accordance with Indonesia Mandatory Standard – the Case of Rubber Hose for Gas Stove.

3. Goods that don’t comply with the Provisions on Manual and Warranty Card in Indonesian languange – the Case of Printer.

4. Offering goods by force and untruth gift. – the Case of Home Appliance.

5. Goods that don’t meet the Provisions on labelling.

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PURCHASING GOODS THAT ARE NOT IN ACCORDANCE WITH THE AGREEMENT

• A dentist bought a Dental Unit produced by a European company offered at an

exhibition by its representative in Indonesia. When the dental unit was received, there were some specifications that didn’t fit as agreed.

• First, the Ministry of Trade took an investigation by requesting information from

both the representative and consumer to clear the matter. However, due to insufficient data, the Ministry of Trade directly send inquiries to the manufacturer and then the manufacturer appointed its representative for Southeast Asia to solve the case. Finally, the manufacturer agreed to provide compensation (refund).

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DISTRIBUTION OF GOODS THAT NOT IN ACCORDANCE WITH INDONESIAN MANDATORY STANDARD

Rubber hose for gas stove is one of the products that must comply with

Indonesian Mandatory Standard. Through laboratorial test, some rubber hoses have been proven not in accordance with the requirements of Indonesia Mandatory Standard.

The Ministry of Trade has ordered the companies, both importers and producers,

to recall the products from the market to ensure health, safety and security for the consumers.

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GOODS THAT DON’T MEET THE OBLIGATION PROVISIONS ON MANUAL AND WARRANTY CARD

• Particular printer products have been illegally imported and not provided with

manual and warranty card in Indonesian language. • For these cases, the government has conducted enforcement actions, begin

with foreclosing and followed by investigation for judicial process requirements .

• To protect consumers from products that are not provided with manual and warranty card in Indonesian language, the Ministry of Trade have taken actions against several manufacturers and importers in form off Business License revocation and criminal threats. Furthermore, according to the Minister of Trade Decree No. 19 of 2009, both manufacturer and importer have to provide minimum 6 authorized service centers in different cities.

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OFFERING GOODS BY FORCE AND UNTRUTH GIFT

Goods are offered by forced and by luring with gifts that never intended to be

free gifts. In this case, the seller offering goods with inappropriate practices and the consumers seem to have free gifts from the purchase. However, the customers actually have to pay more than their real price.

Ministry of Trade has suspended this kind of business activity and facilitated the

refund for consumer’s lose.

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GOODS THAT DON’T MEET THE PROVISIONS ON LABELLING

Particular goods have to be labeled in Indonesian language. Some of those

were distributed without appropriate label or without any label. In this case Ministry of Trade has given reprimand letter to businesses to

provide label in Indonesian language. Currently, the government of Indonesia is in process to revise the decree to provide assurance to the consumer’s rights to get the actual information of the products.

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THANK YOU

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