TikTok Shop Indonesia will open again on November 2023 after being banned by the Indonesian Government on 4 October 2023. According to Rifan Ardinato, the Director of Trade Through The Electronic System and Trade of Services at The Ministry of Trade, TikTok Shop in Indonesia must comply with Indonesia’s government requirement to separate the app’s social media and marketplace features in the licensing process.
Shou Zi Chew, the CEO of TikTok Global, has recently reached out to President Joko Widodo, extending an invitation for a dedicated conversation about the future of TikTok Shop in Indonesia. On the other hand, in the upcoming week, Shou Zi Chew has scheduled a meeting with Minister of Economy Teten to further deliberate on this subject.
Trade Minister Respond to TikTok Shop Indonesia Reopening
There are three key points that must be met for the reopening TikTok Shop in Indonesia based on government policy:
- Separating applications between social media and e-commerce. Live streaming systems remain permissible, provided it doesn’t involve direct transactions through their social media app.
- Establishing an official legal entity office within Indonesia and not a representative office.
- TikTok Shop must devise a new and sustainable business model aligning with directives from President Joko Widodo earlier.
These three fundamental requirements from the Indonesian governement. Numerous rumors are spreading on social media that they will be launching the new app before the 11.11 campaign sale next month.
Following the October shutdown of TTS, a profound impact has rippled through both online trading and offline market operations. Not only traders and consumers face challenges in conducting transactions without TikTok Shop, but industrial logistics workers are also feeling the repercussions.
The reduced value of online orders has led to widespread layoffs in courier services, indirectly exacerbating Indonesia’s high poverty rate and slowing down overall buying and selling activities in the country.
TikTok Shop Accused of Disrupting Other Ecommerce Platforms
There is another alternative perspective regarding the TikTok Shop’s closure. There are people who think that the closure of TTS was the result of pressure exerted by various e-commerce companies who perceived TikTok as a formidable competitor, given its substantial earnings in the past two years.
According to research by Katadata, TikTok gained US$1.38 billion revenue throughout the first quarter of 2022. Compared to the 2021 data, the revenue percentage rose up to 69.9%. These robust financials lend to rumors circulating that big e-commerce companies are trying to get rid of TikTok because of its significant influence on consumer behavior.
