Crash: Indonesia now bans merchandise transactions on social media, a new regulation aimed at curbing sales on the platforms, which Jakarta says hurt millions of local small businesses.
“These rules have been in force since [mardi] », Announced the Indonesian Minister of Commerce, Zulkifli Hasan on Wednesday, specifying that the platforms have one week to comply. This regulation, which is an amendment to a set of trade texts adopted in 2020, did not need parliamentary approval to become applicable.
In accordance with this new text, platforms will no longer be able to offer direct transactions, but will have to content themselves with promoting products.
Indonesian officials have been calling for the separation of social media and online commerce activities for several weeks, believing that large platforms like TikTok, widely used in Indonesia, were threatening small local businesses.
“Any government would protect its local trade,” stressed Minister Hasan, indicating that these regulations had been adopted to guarantee “equality in commercial competition”. “Social commerce can place ads [publicitaires], like television, but there must be no transactions. We cannot open a store, we cannot sell directly,” he stressed.
Hard blow for ByteDance
The adoption of the regulations is a new setback for ByteDance, developer of TikTok, which has faced increased scrutiny in the United States and other countries in recent months over the security of user data and the company’s alleged ties to Beijing.
Indonesia represents a large audience for the Chinese giant: it is its second largest market, with 125 million users, according to the company. The archipelago is also one of the biggest markets for its TikTok Shop business, and was the first to pilot the e-commerce branch of the application. But the largest economy in Southeast Asia is also now the first country to take measures to limit it.
TikTok Indonesia expressed “deep concern” over the new regulations. “We respect local laws and regulations and will continue on a constructive path,” the company said.
On Monday, after the announcement of this new regulatory framework by Indonesian President Joko Widodo, a spokesperson for TikTok Indonesia estimated that the ban on these transactions would harm the no less than 6 million local sellers who sell their products on the platform.
Meta, owner of Facebook and Instagram, did not react.
A choice to make
The Minister of Commerce appeared to confirm that according to the new regulations, social media platforms will have to choose between a license for their classic social media activity and another for operating online commerce.
“It’s clear: there are no licenses for social commerce. If they want social commerce, it’s only for promotion and announcements. If they want to sell, there are [licences] for e-commerce,” he said.
At the historic Tanah Abang Market, the largest textile market in Southeast Asia, in the heart of Jakarta, the new measures were welcomed with satisfaction. “The government had to innovate in the face of this situation,” declared Stevanie Ahua, a 60-year-old jeans seller, who saw her turnover drop by 60% in a few months due to sales competition. online.
Online sales in Indonesia are dominated by platforms like Tokopedia, Shopee or Lazada, but TikTok Shop has taken considerable market share since its launch in 2021. Last June, visiting Jakarta, the CEO of parent company ByteDance, Shou Zi Chew, announced that the group would invest “billions of dollars” in Southeast Asia over the coming years, where TikTok has a total of 325 million users.