The EU is the largest export market after America and Japan for rattan handicraft products from Indonesia. Indonesia is the country’s largest producer of rattan raw materials in the world and before has implemented a protection policy of rattan raw materials that impact on the rapid growth exports of handicraft rattan products from Indonesia. Along with the change policy and begin the release of rattan raw material exports from Indonesia, export of processed rattan handicraft into the European Union continues to decline, this trend occured especially from 2005 to 2009. This research is viewed through the perspective of trade liberalization. The concepts used in this research is liberalism, international trade, exports, trade barriers, business strategy, ecolabel policy and profile of the EU. This study used descriptive qualitative approach, using technique of primary data collection through interviews with sources from Indonesia Rattan Foundation and rattan industry and secondary data collection through literature, media and websites. The results showed declines in exports of rattan handicraft products from Indonesia to the EU in the period of 2005-2009 was caused by several factors, both internal and external. Internal factors caused by the policies of the country, the scarcity and high prices of raw materials that have an impact on the inhibition of the production process. While external factors caused by the tight competition from rival countries, the economic crisis in the EU, strict export regulations, the emergence of substitute products to the shifting trends of rattan products.