TEMPO.CO, Jakarta - The White House states that the Indonesian Government will exempt companies and products from the United States from the Domestic Component Level (TKDN) requirements. According to the White House, this is part of the trade agreement between the two countries.

"Exempting U.S. companies and originating goods from local content requirements," wrote the White House in a Joint Statement on the Framework of Reciprocal Trade Agreement between the U.S. and Indonesia, released on its official website on Tuesday, July 22, 2025, U.S. time.

The White House explains that the exemption of TKDN for companies and products from the U.S. is one of the steps taken by both countries to overcome non-tariff barriers. The removal of TKDN regulations for U.S. products, continued the White House, is included in the priority areas of bilateral cooperation.

"The United States and Indonesia will work together to address Indonesia’s non-tariff barriers that affect bilateral trade and investment in priority areas," wrote the White House.

In addition to TKDN, Indonesia is also committed to eliminating other non-tariff barriers for U.S. industrial exports, including approval for the entry of vehicles made in accordance with U.S. Federal motor vehicle safety and emissions standards, as well as accepting certificates from the U.S. Food and Drug Administration (FDA) and marketing authorizations for medical devices and pharmaceuticals.

Furthermore, Indonesia will remove certain certification and labeling requirements for exports of cosmetics, medical devices, and other manufactured goods; eliminate import restrictions or licensing requirements for remanufactured U.S. goods and parts; as well as remove pre-shipment inspection or verification requirements for U.S. imports.

Moreover, Indonesia is willing to adopt and implement good regulatory practices; resolve issues related to intellectual property as detailed in the Special 301 Report by the Office of the United States Trade Representative (USTR); and address U.S. concerns over Indonesia's assessment procedures.

It is worth noting that the legal basis related to TKDN is stipulated in various Decrees of the Minister of Industry and the Minister of Industry Regulations. These regulations govern TKDN in several industrial sectors and products, such as medical devices, electric vehicles, and electronic and telematics products.

According to the Knowledge, Learning, and Outreach Platform (KLOP) website of the Ministry of Public Works (PU), TKDN is part of the regulation of Increasing the Use of Domestic Products (P3DN), as stipulated in Article 56 of Government Regulation (PP) Number 29 of 2018 concerning Industrial Affairs.

A Deputy Minister for P3DN Affairs was appointed in 1983, establishing the P3DN policy. Moreover, the history of P3DN began with the first Indonesian Product Exhibition (PPI) held in 1984 based on Presidential Instruction (Inpres) Number 7 of 1984 regarding the PPI.

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