· Duty-free market access for palm oil for technical purposes or for the production of soups and sauces. · However, existing rights under the TRIPS Agreement on compulsory licensing are expressly protected. · The level of protection is based on and exceeds the WTO TRIPS Agreement (Agreement on Trade-Related Aspects of Intellectual Property Rights). · Switzerland will grant Indonesia duty-free market access for industrial products upon entry into force of the agreement. Indonesia will reduce tariffs on cheese and dairy products when the agreement enters into force, i.e. over a five-year period. For yogurt, the duty reduction period is nine years. No agreement could be reached on the reduction of tariffs on all textile products, a particularly sensitive sector for Indonesia. However, it was agreed that customs duties on Switzerland`s largest exports in this area would be reduced over a period of five to twelve years. The tariff concessions are designed in such a way that all the main Swiss export sectors can benefit from the agreement, both industry and producers of agricultural products. In return, Switzerland grants Indonesia duty-free access for industrial products. The tariff concessions granted in the agricultural sector are essentially the same as in other free trade agreements.
Tariff reductions will be asymmetrical for most of the products listed in Chapters 25 to 97. While the EFTA countries will abolish their tariffs in a single step when the agreement enters into force, the reduction/elimination of tariffs in Indonesia will be gradual. · The agreement essentially contains a negotiating clause which guarantees the EFTA States, upon request, the possibility of negotiating access to public procurement in the event that Indonesia concludes an agreement with a third country with obligations in this area. · The EFTA States and Indonesia intend to strengthen economic cooperation in order to enhance the mutual benefits of this Agreement, in accordance with national strategies and policy objectives and taking into account the different levels of social and economic development. • Switzerland will grant Indonesia duty-free market access for industrial products with the entry into force of the agreement. • Switzerland will grant Indonesia concessions for certain agricultural products of export interest. • However, there will be no free trade in agricultural products. Switzerland`s tariff concessions are limited and do not pose a threat to domestic production.
The same applies to concessions for palm oil. • The additional legal certainty in business relations will make Indonesia more attractive for Swiss companies when it comes to setting up subsidiaries. • Indonesia will be helped to make the most of the opportunities created by the agreement. For Switzerland, this support is mainly part of the existing economic cooperation between the two countries, which has been led by a representative office in Indonesia for many years. The objective of Chapter 4 is to improve the legal framework for investors from EFTA countries and Indonesia who invest in each other`s markets. This is achieved by granting non-discriminatory rights of establishment (“commercial presence”) in sectors not covered by the Chapter on Trade in Services and listed in Annex XVI. In some of these economic areas, Contracting Parties have included national treatment in their national legislation due to restrictions. The chapter is subject to regular review of the possibility of further developing the obligations of the Parties. The Parties recognize that economic development, social development and environmental protection are interdependent. In Chapter 8, they reaffirm their commitment to multilateral environmental and labour agreements and principles and undertake to maintain the level of protection while recognizing the right of each Party to establish its own level of environmental and occupational health and safety.
Arbitration shall not apply to this Chapter. The agreement contains detailed provisions on trade facilitation (Annex VI). CEPA is Indonesia`s first free trade agreement with European countries. It is also a unique type of contract as it includes the PPM sustainability standard. Given that EFTA is currently negotiating trade relations with the MERCOSUR countries (Argentina, Brazil, Paraguay and Uruguay), discussions on the sustainability clause could also have an impact on this agreement. · Duty-free quotas of 100 tonnes for Red Virgin palm oil in bottles not exceeding two litres for direct consumption. · In addition, the Parties undertake to ensure that the principles of environmental protection and labour standards set out in national legislation are not weakened in order to attract investment or gain a commercial advantage. CEPA also includes a chapter on trade and sustainable development, making the free trade agreement unique. This chapter recognizes that economic development, social development and environmental protection are interdependent. Chapter 8 of CEPA reaffirms the Parties` commitment to multilateral environmental and labour agreements and principles and to maintaining the level of protection. Each Party shall have the right to set its own level of environmental and occupational health and safety.
However, originating products which, on the date of entry into force of the Agreement, are either in transit or in temporary storage in a customs warehouse or free zone may benefit from preferential treatment under the Agreement. In such cases, it can go up to 28. February 2022 to present an origin declaration made in the exporting country after the entry into force of the agreement as well as documents proving direct transport. • Switzerland has granted Indonesia only limited tariff reductions, which apply only to sustainably produced palm oil. The concessions are intended to ensure that CEPA`s imports of palm oil into Switzerland will not increase overall. • Indonesia could gain market share in the long term thanks to the agreement. • However, this will only happen to the extent that the country`s palm oil producers will be able to meet the criteria of the Swiss market. An essential prerequisite for this will be compliance with the strict requirements for the sustainability of palm oil in the domestic market in international comparison. • Almost all palm oils destined for the Swiss food industry are already certified sustainable, partly thanks to the voluntary commitment that importing companies have already made, but also due to the growing demand for sustainably produced palm oil.
• The sustainability requirements of the agreement will ensure that this remains the case, thus meeting the growing consumer demand for sustainably produced palm oil. As a broad-based free trade agreement, CEPA EFTA-Indonesia covers trade in goods, trade in services, investment, intellectual property rights, government procurement, competition, trade and sustainable development, and cooperation. In the area of trade in goods, the EFTA States shall abolish all customs duties on imports of industrial products, including fish and other marine products, originating in Indonesia. Indonesia will phase out or reduce tariffs on industrial products, including fish and other marine products, originating in an EFTA State. • If these criteria are not met, imported palm oil cannot benefit from the preferential conditions of the agreement. Here you will find the relevant documents and the most frequently asked questions about the Free Trade Agreement (FTA) with Indonesia, which entered into force on 1 November 2021. .