Indonesia Officially Bans TikTok Shop for Commerce;

TEMPO.CO, Jakarta - President Joko "Jokowi" Widodo revisited social commerce regulation by revising Minister of Trade Regulation No. 50 of 2020 regarding Provisions on Business Licensing, Advertising, Guidance and Supervision of Businesses Trading Trade through Electronic Systems. The revised regulation prohibited social media such as TikTok to conduct commerce.

Minister of Trade Zulkifli Hasan announced the decision after a limited meeting with Jokowi today. According to Zulhas, social commerce is only allowed to facilitate goods and services promotion without direct transaction. Additionally, a different platform for social media and economic activity is required.

"To prevent domination of the algorithm and prevent the usage of personal data in business interest," he said during a press conference.

Earlier, Minister of Cooperatives and MSMEs Teten Masduki expressed his rejection of TikTok Shop, a social commerce platform. According to Teten, the China-based platform has been involved in predatory pricing, which caused damages to local MSMEs. 

On Wednesday, Teten inspected the Tanah Abang market to find out the condition of Southeast Asia's biggest wholesale center. He reported that the sellers experienced more than 50% loss of profits because they could not compete with the imported products sold at much lower prices.

Teten, in a press conference on Monday with Zulhas, mentioned that the revision will justly regulate fair trade between online and offline.

Minister of Communication and Informatics Budi Arie stressed that the regulation is intended for all social commerce platforms when asked about TikTok Shop. If a violation is found, Zulhas mentioned, a warning will be issued to the Communication and Informatics Ministry before closing down the platform.

DANIEL A. FAJRI

Click here to get the latest news updates from Tempo in Google News