E-commerce scale will reach 83 billion US dollars, and the Indonesian government will strengthen market supervision

Recently, the Indonesian E-Commerce Association stated that certain requirements in the Job Creation Law, the Stamp Duty Law, and certain government regulations and ministerial regulations will bring risks to e-commerce.

Among other things, the Job Creation Law requires e-commerce platforms to include any buyer’s citizen identification number (NIK) or their tax identification number (NPWP) in their tax invoice .

The Indonesian E-Commerce Association wants to be part of the legal revision process so that the regulations can properly achieve their goals and give platforms more flexibility in reporting invoices .

In addition, the Indonesian E-Commerce Association also criticized Government Regulation (PP) No. 80/2019 on e-commerce .

It is reported that through the derivative Trade Ministry Regulation No. 50/2020, PP requires small and medium-sized enterprises (SMEs) to obtain a license to sell their products on the electronic market. The regulation caused confusion among SMEs when it was first passed.

The PP also stipulates that e-commerce stores must prioritize locally produced products and services and provide dedicated sections to showcase local products.

The Indonesian Employers Association ( Apindo) has pointed out that the number of imported goods sold on e-commerce platforms has increased threefold from 19.5 million in 2018 to 57.9 million in 2019.

However, the e-commerce association also highlighted the Minister of Communications and Information Regulation No. 5/2020, which requires online platforms, including e-commerce platforms, to provide content in moderation.

Under the regulations, the ministry may block platforms that fail to remove what it calls “repressive” content, such as child pornography and gambling, within four hours of receiving an initial notice . Platforms have 24 hours to remove content that “undermines society and public order.”

It is understood that over the past year, the Indonesian government has been working to strengthen e-commerce regulations to manage the industry.

The industry’s gross merchandise value (GMV) in Southeast Asia is expected to reach US$124 billion by 2025, capturing a large portion of Southeast Asia’s US $309 billion internet economy .

According to the e-Conomy SEA 2020 report released by Google and Temasek , Indonesia's e-commerce GMV is expected to grow 21% from 2020 to US$83 billion between 2020 and 2025 .

policy

Cross-border e-commerce market

Southeast Asia