This is an HTML version of an attachment to the Freedom of Information request 'Stakeholder contacts and internal communication on the EU-Indonesia Free Trade Agreement (2)'.



Ref. Ares(2017)5268976 - 27/10/2017
Ref. Ares(2019)3157032 - 13/05/2019
To: 
KONIG Helena (TRADE); 4.1(b)
 
 
 
 
 
Subject: 
Report of the meeting on IDN with Medecines for Europe and Fresenius-KABI, 
19 October 2017 
 
Fyi 
 
On 19 October 2017,  DG TRADE  4.1(b)
 ) met " Medicines for 
Europe", representing generics in the pharmaceutical industry, and Fresenius-Kabi.  Fresenius-Kabi, in 
particular, represents a 5 bn US dollar- business with most sales taking place abroad (3 Bn US dollars). It 
owns a subsidiary and has a joint venture in Indonesia.  It employs about 300 people in Indonesia. 
 
Fresenius-Kabi's representative showed a deep understanding of Indonesia's dynamics and stressed that 
it is difficult , in general, to point to trade restrictive legislation as barriers are built through practice (N.B. 
this confirms our experience in all fields). 
 
4.2
 
 
  
 
DETAIL 
 
MfE pointed to the main following elements (N.B. also conveyed via the questionnaire addressed to 
stakeholders when the negotiations for an EU-IDN FTA were launched): 
 
•  IDN represents an interesting market due to its size and the Government's intention to extend 
health insurance to all. However, it is difficult for foreign industries to sell or invest in loco due to 
numerous trade barriers. On the other hand, tariffs are low and there are reportedly no 
intention to increase them. 
•  Halal legislation has the potential to become one of the main barriers.  IDN will soon implement 
the framework law No 33/2014  (in 2019)  and the establishment of an ad hoc agency (BHJPH) is 
evidence of that. Though not directly placed under the Ministry of religious affairs , its highest 
officials are former members thereof. The halal legislation is reported to impose mandatory 
certification and mandatory labelling for halal certified products and for non-halal products. 
While halal certification will be  reportedly mandatory only for those who wish to be certified, 
non-halal ingredients must clearly be indicated  on the label. MfE drew attention to the need to 
avoid an halal  logo on the package (as a marking of 'non halal' would in practice mean that this 
product would no longer be bought).  For active pharmaceutical ingredients (APIs), it is 
impossible to trace the origin in order to ensure compliance with halal requirements. This affects 
all pharmaceutical producers, local and foreign.  Important to note that both generic industry 


(MfE) as well as EFPIA are equally concerned by this.  4.2
 
 
•  4.2
 
 
 
•  It is uncertain whether the industry will continue to either produce or sell pharmaceuticals in 
Indonesia.  Legal uncertainty affects  the industry's decision to place new products on the market 
due to costly, lengthy authorization processes. The Government's practice mainly limits people's 
access to pharmaceuticals, as most medicinal products are of imported origin in Indonesia. 
Potential uneven application of the law is a threat, in particular for foreign manufacturers.   
•  Labelling rules (fully integrated to the product, in Bahasa) require costly, resource intensive 
compulsory labelling on the imported product, no stickers or possibility to relabel in-country are 
allowed. 
•  Procurement rules have an implicit bias towards buying from 100% domestic companies (rather 
than from JVs based in Indonesia) 
•  4.1(a) and 4.2
 
 
We agreed to continue our exchanges. 
 
 
 
 
 
 
4.1(b)
 
Senior Expert 
4.1(b)
 
 
European Commission 
DG TRADE 
Unit C2 “South and South East Asia, Australia, New Zealand” 
4.1(b)
 
B-1049 Brussels/Belgium 
4.1(b)