President Prabowo Subianto recently announced a new policy that will centralize exports of several major natural resource commodities, marking one of the most significant changes to Indonesia’s commodity trade with a great welfare impact for the people.
Under the plan, exports of strategic commodities, including coal, palm oil, crude oil, and iron ore concentrate, will be coordinated through PT Danantara Sumberdaya Indonesia, a state-owned enterprise (SOE) established to oversee the process.
The government says the move is designed to capture a better share of the economic value generated by natural resources. Officials have long argued that practices such as under-invoicing have reduced potential tax and royalty revenues, weakened export earnings, and limited visibility into trade flows.
By introducing a centralized export scheme, policymakers hope to improve control over export proceeds, enhance Indonesia’s bargaining position in global commodity markets, create a national commodity trading platform, and generate recurring revenue linked to export activity.
A Transition Period for Exporters
The policy will be introduced gradually. During the transition period from June 1 to August 31, 2026, exporters will continue conducting business with overseas buyers under existing commercial arrangements.
However, companies will be required to report export volumes, prices, and transaction values to PT Danantara Sumberdaya Indonesia. According to the government, this phase is intended to give businesses time to adjust their systems, contractual arrangements, and international trade processes.
The transition period will also allow authorities to assess potential gaps between reported export prices and prevailing international market prices—an issue that has long been linked to concerns over revenue leakage.
Starting September 1, 2026, the government plans to implement the centralized export model. At that stage, PT Danantara Sumberdaya Indonesia is expected to become the primary gateway for strategic commodity exports, covering activities ranging from contract execution and shipment coordination to the receipt of export proceeds.
While officials believe the system could foster Indonesia’s position in global commodity markets and improve the management of export earnings, some businesses and investors have expressed concerns about how the new framework could affect existing trading arrangements.
What It Means for Transfer Pricing
The shift to a centralized export model could create significant challenges for taxpayers. For companies that have built their tax and transfer pricing arrangements around direct export arrangements, the new system may require reassessing existing business structures.
While related-party transactions may already be priced on an arm's-length basis, the new export pricing will be subject to government involvement through PT Danantara Sumberdaya Indonesia. Companies may therefore need to revisit their transfer pricing policies to remain consistent with market conditions and economic substance.
For many multinational groups, commodity exports involve cross-border transactions with related parties, including arrangements related to pricing, financing, and intra-group services. Under a centralized export framework, the government will have greater visibility into commodity prices, export volumes, and supply-chain structures.
That increased transparency could reduce the risk of pricing discrepancies between related-party transactions and prevailing market prices. As a result, companies may need to reassess existing transfer pricing policies to ensure continued compliance with the arm’s-length principle while reducing the risk of future tax disputes.
Preparing for the Transition
As the new framework takes shape, companies may need to review their transfer pricing arrangements, particularly those involving commodity exports to related parties.
One crucial step is benchmarking export prices against recognized international market references, including global pricing indices for coal, minerals, and crude palm oil (CPO).
Businesses should also ensure that transfer pricing documentation, including local, master, and country-by-country report files, remains consistent with the information reported to PT Danantara Sumberdaya Indonesia.
Additionally, companies may wish to assess potential exposure to tax adjustments arising from differences between related-party pricing arrangements and government reference prices. In some cases, an advance pricing agreement (APA) can provide greater certainty about the transfer pricing method to be applied to future transactions.
Tax Scrutiny Beyond Export Prices
Once the centralized export system is fully operational, tax authorities are likely to focus not only on commodity pricing but also on how functions, assets, and risks are managed throughout multinational supply chains.
Better transparency around export transactions could lead to closer scrutiny of other related-party arrangements, including management fees, royalties, intercompany financing, and procurement services.
Consequently, businesses may need to demonstrate more clearly that these transactions have genuine economic substance and deliver measurable commercial benefits. Transfer pricing policies are increasingly expected to reflect real value creation rather than simply the allocation of profits across jurisdictions.
For companies operating in Indonesia’s natural resources sector, strong documentation and a defensible transfer pricing are likely to become even more important as oversight intensifies.
Indonesia’s one-door export policy represents a major shift in the governance of strategic commodity exports. With increased transparency and centralized oversight, the policy may require businesses to reassess their existing transfer pricing arrangements to remain aligned with the arm’s-length principle and evolving regulatory expectations.
