Govt Warns Retailers about Store Closing Sales or Discounts

TEMPO.CO, Jakarta - The Indonesian Ministry of Trade issued a warning that sanctions will be set in place for retailers caught intentionally misleading consumers with major discount offerings or sales prior to permanent store closure. 

Preventing this from happening the Indonesian law has even specifically stated this in Consumers Protection Law No/8/1999 as the practice of slashing prices, discounts, and sales are regulated under the law’s Article 9 and Article 10. 

Citing bisnis.com, the Ministry of Trade’s Director of Business Development and Distribution Actor, Nina Mora, explains that business owners are banned from offering, prompting, advertising, or making incorrect or misleading statements to make products seem to have slashed prices or discounts. 

“These Articles ban product offerings that make the items seem to be discounted and banning businesses from providing incorrect or misleading information related to discounts,” said Nina to Bisnis.com on April 11. “The sanctions for such violations is a maximum 5-year imprisonment or fines up to Rp2 billion.”

The ‘store closure discount’ or ‘big sale’ practice was mentioned after numerous retail stores are offered due to the effects of the Covid-19 pandemic. Based on the data from the Indonesian Retailers Association (Aprindo) there are major retailer brands that have closed amidst the pandemic with 1 Carrefour closed and 9 Giant outlets, and 15 Ramayana outlets also stopping operations.

This also comes after reports about a giant retail store from a brand mentioned above offering 90 percent discounts for electronic products and advertised in its social media account with the tag #semuaharushabis or everything must be sold out. 

Read: Retail Industry Prepares for Dwindling Economy; Mitigation Plan Set in Place

BISNIS.COM