DECREE OF THE MINISTER OF INDUSTRY AND TRADE NO. 93/MPP/Kep/3/2001 DATED MARCH 14, 2001
PROCUREMENT AND DISTRIBUTION OF UREA FERTILIZER TO THE AGRICULTURAL SECTOR
THE MINISTER OF INDUSTRY AND TRADE
Considering :
a. that urea fertilizer is one of basic fertilizers needed for increasing the production and quality of results of the crop cultivation;
b. that in order to increase the production of agricultural products, particularly food crop in the framework of supporting the successful program for enhancing food resilience, it is necessary to support the procurement of urea fertilizers which can fulfill six appropriate principles, namely : appropriate type, appropriate amount, appropriate time, appropriate quality, appropriate place and appropriate price;
c. that in order to guarantee the procurement and the smooth distribution as well as to prevent irregularities in distributing urea fertilizer, it is necessary to stipulate a decree of the Minister of Industry and Trade.
In view of :
1. Law No. 12/1992 on Plant Cultivation System (Statute Book of 1992 No. 46, Supplement to the Statute Book No. 3478);
2. Government Regulation No. 28/1997 on Addition of Capital Participation of the Republic of Indonesia in Limited Liability Company (Persero) PT Pupuk Sriwidjaja;
3. Presidential Decree No. 3/1969 on Policy on Procurement and Distribution of Manufactured Fertilizers and Pesticides for Plant;
4. Presidential Decree No. 165/2000 on Status, Task, Function, Authority Organizational Structure and Procedure of Work of Ministries as has been changed by Presidential Decree No. 172/2000;
5. Presidential Decree No. 234/M/2000 on the Composition of Cabinet of 1999-2004 period;
6. Decree of the Minister of Industry and Trade No. 23/MPP/Kep/I/1998 on Trade Business Institutions; 7. Decree of the Minister of Industry and Trade No. 86/MPP/Kep/3/2001 on the organization and working
arrangement of the Ministry of Industry and Trade;
8. Decree of the Minister of Industry and Trade No. 558/MPP/Kep/12/1998 on Export General Provision as has been amended by Decree of the Minister of Industry and Trade No. 146/MPP/Kep/1/1999.
DECIDES : To revoke :
Decree of the Minister of Industry and Trade No. 26/MPP/Kep/1/1999 dated January 14, 1999 on Distribution of Fertilizers to Farmers of Food Crops in regions which is difficult to reach.
To Stipulate :
THE DECREE OF THE MINISTER OF INDUSTRY AND TRADE ON PROCUREMENT AND DISTRIBUTION OF UREA FERTILIZER TO THE AGRICULTURAL SECTOR
Article 1 Referred to this decree as :
(2) Distribution is a process of distributing of urea fertilizer from producer level to consumer level.
(3) Producers are local companies which produce urea fertilizer, namely PT Pupuk Sriwidjaja, PT Petrokimia Gresik, PT Pupuk Kujang, PT Pupuk Kalimantan Timur, and PT Pupuk Iskandar Muda.
(4) PT Pupuk Sriwidjaja (PT Pusri) is a company which acc to Government Regulation No. 38/1997 is a share-holder of PT Petrokimia Gresik, PT Pupuk Kujang, PT Pupuk Kalimantan Timur, and PT Pupuk Iskandar Muda.
(5) Business Unit of PT Pusri is a marketing unit of PT Pusri assigned to distribute urea fertilizer from producers to consumer.
(6) Distributor is a legitimate business entity appointed by producer to buy, store, sell as well as to market urea fertilizer in a large quantity to be sold to end consumers in a small quantity.
(7) Retailer is individual or business entity whose basic activity is to sell directly to consumer in a small quantity.
(8) Line I is urea fertilizer warehouse located near to urea fertilizer firms in Indonesia or outside ports for imported fertilizer.
(9) Line II is urea fertilizer warehouse located in provincial capital and Fertilizer Packaging Unit (UPP) or in outside port areas.
(10) Line III is urea fertilizer warehouse located in the level of regency or city (11) Line IV is urea fertilizer warehouse located in kiosk or retailer
Article 2
Producers are assigned to implement and be responsible for the smooth procurement and distribution as well as supply of urea fertilizer stock to the agricultural sector.
Article 3
(1) The distribution of urea fertilizer to farmers engaged in the food crop, fishery, animal husbandry and small holder plantation sectors is executed by Business Unit of PT Pusri, Producers, Distributors and retailers.
(2) The implementation of the provision in paragraph 1 of this Article is ruled as follows :
a. Business Unit of PT Pusri and or Producer implement procurement of urea fertilizer up to the warehouse of Line III
b. Business Unit of PT Pusri and or Producer sell urea fertilizer in warehouse of Line III to Distributor c. Distributor sells urea fertilizer from Line III to Retailer in Line IV
d. Retailer sells urea fertilizer in Line IV to farmers.
(3) If urea fertilizer distribution as mentioned in paragraph (1) and (2) of this Article is not run smoothly and or not possible to be implemented, Business Unit of PT Pusri and or producer must implement selling in Line IV.
Article 4
(1) Provisions on the requirements for the appointment of distributors is as mentioned in Attachment to this decree.
(2) The appointment and dismissal of distributors is stipulated by producers.
(3) Working relations between distributors and producers and or Business Unit of PT Pusri as well as its sanctions are ruled through a Trading or Contract Agreement.
Article 5
(2) Working relations between distributors and retailers as well as its sanctions is ruled in a Trade or Contract Agreement
(3) Each retailer is obliged to install a billboard measuring 0.50 x 0.75 meter square, and mention the retail price in accordance with the provision.
Article 6
Producers are obliged to guarantee the availability of minimal stocks of urea fertilizer in Line III on the Java island for fulfilling the need for one week, in regions outside Java for two weeks from the distribution plan of the following month.
Article 7
(1) Procurement and Distribution of urea fertilizer for big Plantation (State owned enterprises (BUMN), region owned enterprises (BUMD), and Private Sector), Timber Estate (HTI), or Industry can be implemented by Business Unit of PT Pusri, Producer and or distributor after prioritizing the need of retailer.
(2) In the implementation of paragraph (1) of this Article, Distributor is obliged to report the sale to producer or Business Unit of PT Pusri.
Article 8
(1) Distributor obliges to convey reports about procurement, distribution and urea fertilizer stock authorized periodically for each month to producer and or Business Unit of PT Pusri in Line III.
(2) Producer and or Business Unit of PT Pusri in Line III obliges to convey reports about procurements, distributions, stocks of urea fertilizer which is authorized periodically for each month to related agencies in regencies/cities.
(3) Business Unit of PT Pusri and or Producer oblige to convey report about procurement, distribution, and stocks of urea fertilizer which is authorized periodically for each month, including problems and efforts to solve the problems to the Director General of Domestic Trade, Director General of Chemical, Agro and Forestry-based industries as well as the Director General of Agricultural Facility Supervision.
Article 9
The supervision over the implementation of this decree is further ruled and coordinated by Director General of Domestic Trade.
Article 10
This decree shall come into force as from the date of stipulation.
For public cognizance, this decree shall be announced by placing it in the State Gazette of the Republic of Indonesia.
Stipulated in Jakarta On March 14, 2001
THE MINISTER OF INDUSTRY AND TRADE sgd
REQUIREMENTS FOR DISTRIBUTORS
1. Indonesian Business entity
2. Fulfilling general requirements for implementing trading business, namely having Trading Business Licenses (SIUP), Corporate Registry Number (TDP), Business Place Permit (SITU), Taxpayer Code Number (NPWP), and other provision based on the existing regulations.
3. Prioritizing parties having experience in the distribution of fertilizers or other commodities connected with farmers.
4. Having funds to buy 200 tons of urea fertilizer at the minimum in Java and 100 ton in regions outside Java. 5. Controlling supporting facilities, at least warehouses to store fertilizer and its transportation equipment. 6. Having marketing network
7. Having technical personnel in its working territory
8. Being obliged to set up a billboard measuring minimally 1x2 meter square.
THE MINISTER OF INDUSTRY AND TRADE sgd
