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(1)

ARRANGEMENT

ON THE

JOINT INDONESIA-AUSTRALIA CIVIL AVIATION SECURITY

CAPACITY BUILDING PROJECT

I.

PURPOSE

1.

This

Arrangement expresses the specific understandings of the aeronautical authorities of the Government of the Republic of Indonesia (the and the aeronautical authorities of the Government of Australia (the"GOA"), hereinafter referred to as the "Parties", on civil aviation security and on the implementation of the Joint Indonesia-Australia Civil Aviation Security Capacity Building Project, referred to as the"Project". This Arrangement is pursuant to the 2000 Memorandum of Understanding Between the Government of Australia and the Government of the Republic of Indonesia on Cooperation in the Transport Sector.

CONSIDERATION

2. In this Arrangement the Australian and Indonesian aeronautical authorities consider that:

the adoptionbythem of theinternationally-acceptedcivilaviationsecurityStandards andRecommendedPractices,assetoutinAnnex17of theConventiononInternational

CivilAviation(hereinafterreferredasAnnex17)and promulgatedfromtime totimeby theInternationalCivilAviationOrganisation(ICAO),isfundamentaltotheoperation ofsafeandsecureairtransportbetweenAustraliaandIndonesia;

effectivecivilaviationsecuritysafe-guardsinternationalcivilaviationagainstactsof unlawfulinterferenceandother of trans-nationalcrime, theriskof immediateandpotentiallydevastatingconsequences,economicallyandsocially,ofan unlawfulinterferenceorothercriminalactivity;

investment intravelsecuritymaintainsanenvironmentinwhichtradeandtourismmay

be conducted without hindrance, thereby helping exports to expand, tourism and investmenttogrow,andstandardsoflivingtoincrease;and

(2)

(c) skills transfer to counterparts in airport security planning and practice; and

3. For the purpose of implementing this project and based on funding as stated in this Arrangement, the Government of the Republic of Indonesia will exempt the Government of Australia, its employees or contractors engaged on this Project from any taxes, tariffs, duties, fees or other levies, in accordance with the applicable laws and regulations.

CLAIMS

4. The Government of Australia, its employees or contractors engaged on this Project will at all times undertake their duties in accordance with Indonesian laws and regulations.

5 . TheGovernmentoftheRepublicofIndonesiawillbe responsiblefordealingwithany

claims which may be brought by third parties against the Government of Australia, its employeesorcontractorsengagedonthisProjectandwillholdharmlesstheGovernmentof Australia, its employees or contractors engagedon this Project in case of any claimsor

liabilitiesresulting this Arrangement. This provision will not relieve any personor

entityfromliability acriminalact,grossnegligence,orwilfulmisconductonthepartof thatpersonorentity.

V. SCOPE

6. This Arrangement sets out areas for assistance and cooperation between Australia and Indonesia in implementing the Joint Indonesia-Australia Civil Aviation Security Capacity Building Project. The Project is designed to provide mutual benefit by:

enhancing Indonesian travel security,

improving governance of Indonesian civil aviation security,

strengthening airport control systems and capabilities, and

enhancing the partnership between Australian and Indonesian authorities.

PROJECT GOAL

7.

The goal of the Project is to improve civil aviation security in Indonesia, by strengthening:

the capacity of the Directorate General of Civil Aviation to meet the Standards and Recommended Practices set out in Annex 17, and

the capacity of key agencies in the development, implementation and management of civil aviation security at (Jakarta) International Airport and Rai International Airport.

8. The Project will assist with four major outcomes for the GOI:

(a) reduction in security risks acts of unlawful interference or other incidents at airport facilities;

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