Obligation to open L/C for commodity exports cancelled

After delaying it three times, the government finally decided to drop the regulation, which requires exporters of commodities such as mining products, cacao, rubber, and CPO to open a letter of credit (L/C) for export value of more than $1 million.

The regulation is supposed to be implemented starting July 1.

In a decree signed on June 24, Minister of Trade Maria Elka Pangestu said the use of L/C for exports of commodities is no longer necessary , because exports have been running smoothly and the country's foreign exchange rserves have been increasing. Furthermore, the rule contravenes the free foreign-exchange regime.

Besides, the Ministry rescinded the policy obligating exporters to report their exports to the ministry.

"All the old rules have been revoked," the ministry's legal section head Widodo was quoted as saying by Kontan on Sunday. (*)