Indonesia bans e-commerce sales on social media platforms, TikTok speaks out

JAKARTA, Indonesia (AP) — Chinese-owned app TikTok on Thursday said it regretted the Indonesian government's decision to ban e-commerce transactions on social media platforms and particularly the impact it would have on the millions of sellers who use TikTok Shop.

But TikTok Indonesia said in a statement it will respect the regulations and laws that apply in Indonesia and “will take a constructive path forward.”

“We deeply regret the government's announcement, especially how it will impact the livelihoods of the six million sellers and nearly seven million affiliate creators who use TikTok Shop,” said the statement sent to The Associated Press on Thursday.

Indonesia banned goods transactions on social media platforms such as TikTok in a bid to protect small businesses from e-commerce competition, accusing them of predatory pricing.

Indonesia's Trade Minister Zulkifli Hasan on Monday announced the decision after a meeting with President Joko Widodo.

The ban ”is to prevent the domination of the algorithm and prevent the use of personal data in business interests,” Hasan told a news conference.

Hasan said the ban, which takes effect immediately, aims to “create a fair, healthy and beneficial electronic commerce ecosystem by prohibiting marketplaces and social media sellers from acting as producers and facilitating payment transactions on its electronic systems,” according to a statement released by the Trade Ministry on Wednesday.

Marketplaces and sellers can only offer or promote goods and services, he added.

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