MINISTRY OF ENVIRONMENT AND FORESTRY

REPUBLIC OF INDONESIA

Promoting Trade of Legal Timber through Implementation of

SVLK and FLEGT-VPA

Ministry of Environment and ForestryRepublic of Indonesia

The 12th Meeting of APEC EGILAT, Ho Chi Minh City Vietnam, 20-21 August 2017

MINISTRY OF ENVIRONMENT AND FORESTRY

REPUBLIC OF INDONESIA

2001Bali FLEG

Declaration

2003-2009SVLK Development

2009Forestry

Regulation on SVLK

2012Trade

Regulation on SVLK

2013SILK online

2011Negotiation Concluded

2013Signing RI-EU

FLEGT-VPA EUTR Take into Force

2014

EU Ratification

2014FLEGT-VPA Ratification

Import Regulation

2007 RI-EU FLEGT-VPA

initiated

15 Nov 2016FLEGT Licensing

SVLK Development & FLEGT-VPA Progress

2015Joint Declaration

on SVLK Acceleration 23 March 2015

MINISTRY OF ENVIRONMENT AND FORESTRY

REPUBLIC OF INDONESIA

MINISTRY OF ENVIRONMENT AND FORESTRY

REPUBLIC OF INDONESIA SFM Certification (‘S-PHPL’)• Forest/FME

• Mandatory

• Assessment by independent accreditated Certification Body (LPPHPL)

Timber Legality Certification (‘S-LK’)• Forest/FME

• Industry; Trader

• Mandatory

• Verification by independent accreditated Certification Body (LVLK)

MINISTRY OF ENVIRONMENT AND FORESTRY

REPUBLIC OF INDONESIA

SVLK Scope

State-

forests

Private

forests

Market

Primary

Industry

Secondary

Industry

Finished

Products

Imported

timber

V-Legal

Document

(FLEGT

License)

Via SVLK

Online

Legality &

Sustainability

Legality

Legalit

y

Legal

Legal

SCHEME OF INDONESIAN TLAS

V-Legal Issuance

National Accreditation

Body

Accreditation Certificate

CABs/Conformity Assessment

Body

SFM-CTL-C

Auditees –On Farm and

Off Farm

CSOS -IndependentMonitoring

MoEF -LIU

Complaint Complaint

Complaint

Complaint

Export

Appeal

Appeal

Accreditation

Audit

Monitoring

Government

Stipulation

ImportDue Diligence

SVLK Standards and Guidelines

• SFM/Sustainability Certification 4 Standards (Concessions of Natural, Plantation Forests & Ecosystem Restoration, and Management Rights by State Owned Enterprise/Perhutani)

• Timber Legality Certification

* Forest/FMEs 4 Standards (concessions of state-owned forests, state-owned forests managed by communities, private forests, and timber utilization in non-forest zone within state-owned lands)

* Industry, traders 6 Standards (large industries, medium & small-scale industries, household industries/craftsmen, timber depot, non-producer exporter)

• Guidelines 18 Guidelines (verification process, recruitment of etc)

Online Timber Administration System

For Concessions of natural and plantation forest at State owned Forets: Use barcode tracking e-SKSHHK (transport documents)realtime

tracking Security by system Transport documents

printed by users

Timber Administration for Private Forests

Primary Industry

Secondary Industry/ Consumer

Timber Depot

Harvesting Location

Nota AngkutanLanjutan (transport

document)

Privately-owned forest trees:

• planted/cultivated in privately-owned land

• Species:

- commercial species: teak, mahogany

- fast-growing species : sengon (Falcataria), jabon (Antocephalus)

- fruit trees

Transport document (‘Nota

Angkutan’)

Issued by land owner

Information on rights to

land is inserted

Function as ‘Self

Declaration of

Compliance’

Nota Angkutan

verified by primary industry (census)

Verification/validation

Nota Angkutan(transport document)

Nota Perusahaan(transport document)

Integrated On Line Information System on Forest Management

Timber Tracking

System

Non-Tax State

Revenue

Industrial Raw

Material Supply Plan

E-Monitoring and

EvaluationSVLK Certification,

Export, Import

IMPORTER

Request Access

LOGIN

Approved

FILLING DUE DILIGENCE FORMAT

Import Recommendation

Request

RECOMMENDATION

IMPORT DECLARATION(Due Diligence result is

attached)

Denied

Approved/Denied 3 WD

Denied

Approved

7 WD

ONLINE DUE DILIGENCE MECHANISM FOR IMPORTED TIMBER & TIMBER PRODUCTS

DUE DILIGENCE PROCESS(Inventory, Administrative Requirements

Inventory of imported material)

SFM and/or timber legality certificate

ORLetter from Country of Origin on SFM and/or

legality of timber/timber products

OR Country Specific Guidelines (CSG)

OR Mutual Recognize Agreement (MRA)

OR FLEGT-Licence

RISK ANALYSISArticle 10 (1) c

RISK MITIGATION

Article 10 (1) d

720

1705

478

220 151 98 59 75 70 29 43 65 160

200

400

600

800

1000

1200

1400

1600

1800

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017*

* up to May 2017

Source: DG of Fenvironment and Forestry Law Enforcement, MoEF

Illegal Logging Cases in Indonesia

2005 - 2017KEMENTERIAN LINGKUNGAN HIDUP

DAN KEHUTANAN

25 million ha certified and 3249 wood manufacturers certified since 2010

MINISTRY OF ENVIRONMENT AND FORESTRY

REPUBLIC OF INDONESIA

2001Bali FLEG

Declaration

2003-2009SVLK Development

2009Forestry

Regulation on SVLK

2012Trade

Regulation on SVLK

2013SILK online

2011Negotiation Concluded

2013Signing RI-EU

FLEGT-VPA EUTR Take into Force

2014

EU Ratification

2014FLEGT-VPA Ratification

Import Regulation

2007 RI-EU FLEGT-VPA

initiated

15 Nov 2016FLEGT Licensing

SVLK Development & FLEGT-VPA Progress

2015Joint Declaration

on SVLK Acceleration 23 March 2015

Brussels, 21 April 2016

Acceptance of Indonesia FLEGT License for Timber Products of by Minister of Foreign Affairs

Brussels, 30 November 2016

First Shipment using FLEGT Licence to Antwerp15 November 2016

First Trial Shipment Timber Export to Antwerp using V-legal, 23 October 2012

FLEGT License Celebration 24 November 2016

Invoice

number &

barcode

‘FLEGT’

NOTE: Issued by the licensing authority through the

online SILK system (also connected real-time

with the online trade system/INATRADE and

the single window Customs system/INSW).

Issued per invoice = per shipment.

Issued only for SVLK (IDN TLAS) certificate

holder.

‘V-LEGAL DOCUMENT’ AS ‘FLEGT LICENCE SINCE NOVEMBER 15, 2016’

‘FLEGT’

Attached if more than one product in a

shipment.

Describe box 8 to box 16 of each product

Secure with the barcode in the bottom of the

page.

Barcode

cross-reference

of the licence

number

ATTACHMENT OF A LICENCE

Reality against Expectations

ExpectationsRealized?

YES Significantly

YESStarting

NOT YET

Notes

Improved forest governance

Reduced IL and ITT

Market acceptance Buyer still request other certifications

Improved market access(vis a vis voluntary certification)

Waiting for the result of Independent market Monitoring. It also depends on the implementation of due diligence in EU.

Increased export Based on early data fromLIU

Reduced cost (of exporting) ?? For some Products

Premium price ??

MINISTRY OF ENVIRONMENT AND FORESTRY

REPUBLIC OF INDONESIA

Challenges

Cost of

certification issue

A small subset still

against the system

More small producers

to be certified

Technical issues:

carelessness in filling form, taking

for granted on the weight

tolerance, misinterpretation of HS

codes, information inconsistency

(across the various documents,

e.g. bill of lading, invoice, etc.)

Demand of real impacts, e.g.

better price, no need of other

certifications

MINISTRY OF ENVIRONMENT AND FORESTRY

REPUBLIC OF INDONESIA

Further evidence on the

implementation of due diligence

(that it is not easier than using

FLEGT-Licence in entering EU

market)

Concluding Note MINISTRY OF ENVIRONMENT AND FORESTRY

REPUBLIC OF INDONESIA

• The job has not yet done, several issues remain

to be addressed: maintain the credibility of the TLAS,

domestic procurement policy, supports for

smallholders, etc.

• More effort at the demand sides is determining the

future path: promotion, procurement policy,

consistently close entrance of unknown/ uncertified

illegal timber, better access and price appreciation.

KEMENTERIAN LINGKUNGAN HIDUP

DAN KEHUTANAN