Jerry Sambuaga, the Deputy Minister of Trade of the Republic of Indonesia, stated that the revision of the Minister of Trade Regulation (Permendag) No. 50 of 2020 on digital trade does not prohibit the existence of social commerce platforms such as TikTok Shop. The revision aims to regulate and facilitate the selection of social media and e-commerce platforms.

"This is about regulation, and the task of regulators or the government is to regulate. What we regulate is the platform. When it is a social media platform and the regulation says that it cannot be mixed, then it cannot be mixed. It's that simple," said Jerry Sambuaga at the Borobudur Hotel Lobby on Monday, September 25, 2023.

The Deputy Minister also emphasized that the regulation is essential to separate the functions of social media and e-commerce. Therefore, one platform cannot perform two functions simultaneously.

"TikTok cannot perform two functions at the same time. Why? Because we have e-commerce regulations. So, when it is an e-commerce platform, it must follow e-commerce regulations. Meanwhile, TikTok claims to be a social media platform, and social media should not be used for selling," explained Jerry.

Jerry also explained that the presence of TikTok as a social media platform that also serves as a trading platform creates unfairness towards existing online selling platforms that have followed Permendag No. 50 of 2020. Furthermore, Jerry explained that the ministry's regulation is currently in the harmonization stage between ministries and is planned to be completed by the end of this year.

"This is already in the harmonization stage. It's already September, maybe in October or November, hopefully, it can be completed this year, at the latest in December," said Jerry.

Permendag Revision to Avoid Predatory Pricing

Jerry Sambuaga also explained that the revision of Permendag related to the presence of TikTok Shop aims to regulate and provide protection to Micro, Small, and Medium Enterprises (MSMEs). According to him, this is in line with President Joko Widodo's direction to protect the existence of MSMEs.

"This also protects, as Mr. Teten (Minister of Cooperatives and SMEs) and President Joko Widodo said, we must protect MSMEs. We must avoid predatory pricing, so we must not let them become one. We can see imported goods, for example, if they follow the procedure, the price is Rp.1,000,000, but they sell it for Rp.100,000," explained Jerry.

Jerry also explained that the Permendag revision aims to prevent the entry of imported goods that do not comply with regulations and provide protection to all trading actors, from protecting consumers, sellers, MSMEs, and including platforms.

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