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Dream - The government through the Ministry of Trade (Kemendag) officially prohibits social media from conducting online buying and selling transactions, such as TikTok Shop. This is stated in Permendag 31 Year 2023 concerning Business Licensing, Advertising, Dispute Settlement, and Supervision of Business Actors in Electronic Trading Systems.
The Indonesian TikTok team expressed regret over the government's policy regarding the prohibition of buying and selling activities on social media or social-commerce. "We deeply regret the announcement today," said the spokesperson for TikTok Indonesia, as quoted from Liputan6.com, Friday, September 29, 2023.
According to Tiktok, this decision will impact millions of local sellers who have been using TikTok Shop as a platform to sell their products. "Especially how this decision will affect the livelihood of 6 million sellers and nearly 7 million affiliate creators who use TikTok Shop," it continued.
Although so, TikTok will still respect the applicable rules in Indonesia. "We will continue to respect the regulations and laws that apply in Indonesia and will take a constructive approach going forward," he concluded.
Minister of Trade Zulkifli Hasan stated that there is an option for the sellers to switch platforms. "Yes, please do so, because there are other options. You can go to e-commerce. And if you want to advertise, if you want to use TikTok, then you need to handle the permits. It's called social commerce for promotion and advertising, it's allowed," he said.
Mendag emphasizes that the activities that can be carried out by platforms with social-commerce permits in the future are limited to promoting and advertising products. Meanwhile, the transaction process can be done by platforms with e-commerce permits. "Promotion, yes please. What is not allowed is transactions, selling, trading, opening a store," he said firmly.
Other options, in order to be able to carry out the buying and selling business process, TikTok Shop must change the permits it has obtained into e-commerce.
In Minister of Trade Regulation (Permendag) Number 31 of 2023 on Business Licensing, Advertising, Development, and Supervision of Business Actors in Electronic Trading (PMSE) which replaces Permendag Number 50 of 2020. Other provisions include the minimum price per unit of imported goods, as well as the sanctions received if traders violate the provisions. These regulations are stated in Article 19 paragraph 2 which explains, 'The minimum price of goods as referred to in paragraph (1) is US$100 (approximately IDR 1.5 million) per unit, freight on board (FOB).'
"While the administrative sanctions referred to are stipulated in Article 50 paragraph 2, including: - Written warning - Included in the priority monitoring list - Included in the blacklist - Temporary blocking of domestic and/or foreign PPMSE services by the relevant authorized agencies - Revocation of business permits"
"To provide written warnings, a maximum of 3 times is given with a grace period of 14 calendar days starting from the date of the warning letter before it is issued. 'If within the specified period in paragraph (2) the Business Entity still fails to fulfill the obligations as referred to in Article 3 paragraph (1) and/or Article 6, it will be subject to administrative sanctions in the form of being included in the blacklist and temporary blocking of PPMSE services by the relevant authorized agency,' as stated in Article 51 paragraph 3."
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