To be fair, social commerce platforms are separated from e-commerce
Regulation of electronic commerce, especially "social commerce", was discussed at a meeting at the Presidential Palace. MSMEs must be protected from the attacks of the digital world. "Social commerce" must be separated from "e-commerce".
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The following article was translated using both Microsoft Azure Open AI and Google Translation AI. The original article can be found in Agar Adil, Platform ”Social Commerce” Dipisah dengan E-dagang
JAKARTA, KOMPAS — The government is trying to regulate fair trade between trade outside the network and within the network. Through a revised regulation by the Minister of Trade or Minister of Trade, there is a regulation that the social commerce platform must be separated from e-commerce. Social commerce may only facilitate the promotion of goods or services and may not be direct transactions.
President Joko Widodo, while inaugurating the 25th Congress of the Indonesian Journalists Association at the State Palace in Jakarta on Monday (25/9/2023), stated that the government needs to prepare regulations regarding the development of digital technology, including those related to micro, small and medium enterprises (MSMEs). This work is currently being undertaken by the government and the President expects the regulations to be issued on Tuesday (26/9/2023).
"The broad umbrella of digital transformation regulations must be made more holistic. The creative industry must be protected. MSMEs must be protected from the attacks of the digital world and this is what the government is doing. Earlier we decided which social media to use for e-commerce. "Tomorrow maybe (the rules) will come out," he said.
A comprehensive regulatory umbrella for digital transformation must be created. The creative industry must be sheltered, and micro, small, and medium enterprises must be protected from the impact of the digital world. This is what the government is currently working on.
The President stated that the development of information technology has tremendously impactful effects. "We are delayed by how many months, and its effects are felt everywhere," he said.
Therefore, according to the Head of State, the digital transformation umbrella must be holistic. Thus, technological advancements can create new economic potentials, not kill off existing ones.
As reported by Kompas.id on Tuesday (19/9/2023), citing a report from Momentum Works titled "E-commerce in Southeast Asia" in June 2023, the dominant e-commerce platform in Indonesia is Shopee in first place (36%), followed by Lazada (10%), Bukalapak (10%), Tiktok (5%), and Blibli (4%).
Tiktok, which has just transformed into a social commerce platform through Tiktok Shop, has quickly entered the top five even though it was only introduced in 2021. Momentum Works in another report last year regarding Tiktok said that Tiktok is superior compared to pure e-commerce platforms because it takes advantage of high visitor traffic and a pleasant shopping experience.
Tiktok is also aggressively introducing its e-commerce features to traders in offline shops, one of which is clothing traders at Tanah Abang Market. Since then, the shopkeeper has regularly held live shopping twice a day, using only a cellphone, internet connection and additional lighting equipment.
Previously, the explanation regarding the content of the limited meeting was conveyed by Minister of Trade Zulkifli Hasan, Minister of Cooperatives and Small and Medium Enterprises (MSMEs) Teten Masduki, as well as Minister of Communication and Information Technology Budi Arie. The three of them presented this in a press release at the Presidential Palace Complex.
"Just now (we) had a meeting, the theme was regarding the regulation of electronic commerce, in particular we discussed social commerce. It has been agreed that tomorrow, (on) our return, the revision of Minister of Trade Regulation 50/2020 (concerning Provisions for Business Licensing, Advertising "We will sign it," said Zulkifli Hasan after the limited meeting.
Zulkifli stated that his party has discussed this matter with the Ministry of Cooperatives and Small and Medium Enterprises (Menkop UKM) Teten Masduki, the Ministry of Communication and Information Technology Budi Arie, and others.
"The first one will be that social commerce can only facilitate the promotion of goods or services, no direct transactions. It's no longer possible to pay directly. It (social commerce) can only be for promotion. Like TV. TV, right, advertising is allowed, but TV can't accept money. He's a kind of digital platform. "His job is to promote," he said.
Social commerce can only facilitate the promotion of goods or services, not direct transactions.
Zulkifli said, social commerce must be separated from e-commerce. "So, it has to be separated so that not all of the algorithms are controlled. And, this prevents the use of personal data for business purposes," said Zulkifli.
Second, Zulkifli said, the government will also regulate products from outside that can be marketed directly. "We used to call it negative list, now positive list, which is fine. In the past, negative list (meaning) everything was allowed except. Now what is allowed, what else is not allowed, is regulated. For example, there are lots of batik here, why import batik? Something like that," he said.
Next, the position of foreign goods must be treated the same as domestic goods. "The food has a halal certificate. (Products) Beauty (beauty) must have (body permission) POM (drug and food control). If not (there is), who will guarantee it? "Then if it is electronic, there must be a standard, that this is the correct item," he said.
Therefore, according to Zulkifli, there is no different treatment between foreign products and domestic or off-network products. "Thirdly, they may not act as manufacturers. The last, transaction, if we import, we need to have one transaction with a minimum of 100 US dollars. It has already been decided (revised Permendag) today, later in the afternoon, I will sign the revised Permendag No. 50/2020 becoming Permendag by who knows what year in 2023. If there are any violations this week, certainly I will send a letter to the Ministry of Communication and Informatics to warn. After the warning, what else? Close it," said Zulkifli.
When asked about the name of the social commerce in question, Zulkifli answered that his party did not use or mention the brand. "We don't use brands, just anyone. (So far, social commerce has not been regulated, well, now it is regulated," said Zulkifli.
We don't use brands, just anyone. (So far social commerce) has not been regulated, well, now it is regulated.
On the same occasion, Coordinating Minister for UKM Teten Masduki said that three things were discussed at the meeting at the Palace today. ”First, how to set up the platform. Second, how to regulate the inflow of goods. Because (this) is not a matter of local products being unable to compete online or offline. "But offline and online products are being invaded by products from abroad which are very cheap and sold on global platforms," he said.
Third, the government is regulating fair trade between those outside the network and inside the network. "Because in offline it is so strictly regulated, but in online it is still free. The key is to revise the trade regulations. There are regulations regarding platforms, it has been clear the president's directive that social commerce must be separated frome-commerce. And this, right, there are already a lot of queues social commerce also wants to have a transaction application," said Teten.
Regarding the flow of goods, Teten said that there is a regulation that it can no longer be below 100 US dollars. "If there are still not local products, yes, they will be arranged later on the positive list. "So you can still import, but be on the positive list," he said.
According to Teten, the content of the trade minister regulation is a platform that cannot sell its own products. If this revision of the trade minister regulation is implemented, SMEs will be protected. "(If this is implemented) God willing," he said.
We do not want the sovereignty of our data, our data, to be used arbitrarily. Later the algorithm will be social media, later e-commerce, later fintech, later online lending, and so on. This, right, all platforms will expand, right, various types. So, we have to regulate it, we organize it, so that there is no organic, natural monopolistic, unregulated, suddenly controlled by him.
Meanwhile, the Minister of Communication and Information, Budi Arie, said that the government must regulate so that fair trade occurs. "It's no longer free trade but fair trade, fair trade. So, how can social media not automatically become e-commerce, because this is an algorithm. In principle, the state must be present to protect MSMEs in our country. (Trade) Which is fair. "Don't sell the goods there at cheap prices, we will klenger(Javanese: faint)," said Budi Arie.
According to Budi, this is also related to data sovereignty. "We don't want the sovereignty of our data, our data, to be used arbitrarily. Later the algorithm will be social media, later e-commerce, later fintech, later online lending, and so on. This, right, all platforms will expand, right, various types. So we have to regulate it, we organize it, so that there is no organic, natural monopolistic, unregulated, suddenly controlled by him," he said.
When asked about the meaning of social commerce, Budi said that social media is not used for e-commerce or trade needs. "So, the term social commerce emerged. "So, actually (social commerce) is in the middle between social media and e-commerce," he said.
Previously, economist and public policy expert Achmad Nur Hidayat, in a release, Saturday (23/9/2023), said that various efforts must be made to achieve the right balance between innovation and protecting the interests of MSMEs, which are the backbone of the economy. This includes reorganizing social commerce platforms so that they do not harm the national economy.