Indonesia has announced a ban on goods transactions on social media platforms in a new regulation.
This was disclosed by the Trade Minister, Zulkifli Hasan on Wednesday.
Hasan said the move is part of efforts by Jakarta to rein in direct sales on major platforms, which are negatively affecting millions of small businesses.
There have been calls in recent times for law regulating social media and e-commerce, with offline sellers seeing their means of livelihood threatened by the sale of cheaper products o TikTok shop and other platforms.
The Trade Minister during a news conference in Jakarta said, “This trade regulation has been in force (since yesterday).”
He said social commerce platforms would have a week to comply with the new rule.
“Any government would protect local small businesses,” he said, saying the regulation was passed to ensure “equality in business competition.”
The regulation means social media firms will not be able to conduct direct transactions but only promote products on their platforms.
“Social commerce can place ads like TV, but it mustn’t be transactional. (They) can’t open shop, can’t directly sell,” he said, without mentioning TikTok by name.
Laws in the archipelago nation did not cover direct transactions through social media platforms such as TikTok, Facebook or Instagram before the new regulation.
The new regulation is yet another setback for TikTok, which has faced intense scrutiny in the United States and other nations in recent months over users’ data security and the company’s alleged ties to Beijing.
“Other countries are banning, we don’t, (we’re) regulating,” Hasan said.
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