The Deputy Minister of Trade in Indonesia addressed the parliament on Tuesday (September 12), revealing that the government is exploring the possibility of imposing a ban on the sale of goods through social media channels as part of new trade regulations.
Reports indicate that Indonesian officials have consistently expressed apprehension over the pricing strategies employed by social media merchants, which can create competitive disadvantages for businesses operating outside the realm of online communities, such as brick-and-mortar stores.
However, the current trade regulations in place do not provide a comprehensive framework for overseeing direct transactions conducted on online community platforms.
“Social media and e-commerce should be separated,” asserted Sambuaka, offering the example of merchants utilizing TikTok’s live streaming feature to market and sell products.
In response, TikTok emphasized that segregating social media and online sales onto distinct platforms could hinder innovation. The platform expressed hope that the government would strive to establish equitable conditions for TikTok and other players.
A representative from TikTok Indonesia conveyed concerns, stating, “This ban could have adverse consequences for Indonesian merchants and consumers.”
TikTok, which boasts a user base of over 2 million sellers in Indonesia, previously announced that it had no intentions of launching cross-border commerce operations within the country. This decision came in light of government concerns that TikTok’s foray into e-commerce could result in a substantial influx of Chinese goods into the Indonesian market.
Meanwhile, Facebook, which offers product selling features on its platform, has not yet issued any official comments regarding the matter.
The Indonesian government’s contemplation of a ban on social media product sales underscores the evolving regulatory landscape that seeks to balance the growth of e-commerce with fair competition in traditional markets. The outcome of these considerations will have a significant impact on the country’s retail and e-commerce sectors.