TikTok Shop Will Close in Indonesia After Growing Protests from Small Businesses

TikTok Indonesia already spoke out in response to the government's moven to ban TikTok Shop and similar platforms from selling products. TikTok Shop is said to have emerged as a solution for marketing local Indonesian SME products.

"It is important to emphasize once again that social commerce was born as a solution to the real challenges faced by SMEs, helping them collaborate with local creators to increase traffic to their online stores," stated the TikTok Indonesia spokesperson when contacted by Liputan6.com on Monday (25/9/2023).

He stated that TikTok Indonesia will adhere to the prevailing rules and regulations in Indonesia with regard to the regulations to be endorsed by Minister of Trade Zulkifli Hasan, prohibiting the sale of products.

"We will uphold the laws and regulations that are in effect in Indonesia," he affirmed.

Minister Teten Masduki, also highlights the abundance of imported products that are reducing the market share of local SME products.

Comedian and host Ruben Onsu, one of the celebs who used TikTok Shop to sell products, rejected the argument that TikTok Shop was wrong. He believed the social media app was opening opportunities for many people.

'Now the application is getting the blame. Doesn't that open opportunities for all?" said Ruben.

Nonetheless, TikTok Indonesia is calling on the government to evaluate the consequences of enforcing rules against product transactions on this popular social-commerce platform. This is particularly important considering the extensive user base of TikTok Shop.

"We also implore the government to consider the repercussions on the livelihoods of 6 million local sellers and almost 7 million affiliate creators who are dependent on TikTok Shop," he firmly stated.

Previously, the Indonesian E-commerce Association (IdEA) said they would try to review and adhere the new government rule.

IdEA's Chairman, Bima Laga, emphasized that comprehensive rules are necessary to determine their future course of action. This is crucial given that these regulations will address matters related to both e-commerce and social commerce.

Bima emphasized that the effects of the regulations on sales transactions across all e-commerce platforms will become apparent once the comprehensive rules have been studied. This includes future aspects related to trade supervision on online platforms.

He noted that ongoing communication with the government, particularly with the Ministry of Trade, which is responsible for issuing these regulations, has been taking place.

While a deeper understanding of the rules is necessary, Bima says that they will adhere to the government's established regulations.

"We are in communication. Essentially, both us and our members will comply with the prevailing regulations," he clarified.

Tira Santia, Ilyas Istianur Praditya, Arief Rahman Hakim, and M Altaf Jauhar contributed to this report.