Indonesia may issue regulations on social media e-commerce this week

JAKARTA—Indonesia may issue a regulation on Tuesday on the use of social media to sell goods in the country, President Joko Widodo said, a move aimed at quelling threats to offline markets in Southeast Asia’s largest economy.

Ministers have repeatedly said e-commerce sellers using predatory pricing on social media platforms are threatening offline markets in Indonesia, with some officials specifically citing video platform TikTok as an example.

“We just… decided to use social media for e-commerce. It might come true tomorrow,” Widodo, commonly known as Jokowi, said in a streamed video address on Monday.

“What people expect is that advances in technology can create new economic potential, not destroy existing economies.”

Jokowi did not name specific companies or provide further details about the regulations, which are being formulated by the Commerce Ministry.

Current trading regulations do not specifically address direct transactions on social media.

Deputy Commerce Secretary Jerry Sambuaga said earlier this month that “social media and social commerce cannot be combined,” vowing to ban the combination of the two and citing TikTok’s “live” features that allow people to sell goods.

A spokesperson for TikTok Indonesia declined to comment. TikTok is owned by the Chinese technology company ByteDance.

The company said its app had 325 million monthly Southeast Asian users, including 125 million in Indonesia. The company has said that there were 2 million small businesses on TikTok Shop in Indonesia.