Smesco Indonesia: Rules On Social Commerce Aim To Protect MSMEs

Director of Business and Marketing Smesco Indonesia Wientor Rah Mada. (Photo: Doc. Antara)

JAKARTA - Director of Business and Marketing Smesco Indonesia Wientor Rah Mada said the policy regarding selling on social commerce social media aims to create a healthy competition ecosystem and protect micro, small and medium enterprises (MSMEs).

The regulation is contained in the Regulation of the Minister of Trade (Permendag) Number 31 of 2023 concerning Business Licensing, Advertising, Guidance, and Supervision of Business Actors in Trade Through Electronic Systems.

"We have to regulate the ecosystem first, so that this is fair in terms of price, algorithm, and product quality," said Wientor, quoted from Antara, Friday, September 29.

He said that through regulatory regulations, it can protect MSMEs from the practice of predatory pricing or selling losses from imported goods sold on social media.

Based on data from the Institute for Development of Economic and Finance (INDEF), it is recorded that as many as 74 percent of products sold in online stalls are not produced by themselves. INDEF also reports that local products continue to experience threats from imported products, especially products from China.

"If we allow technology to enter without us, the rules are moderate, there is a high disruption, if the height is disrupted, there is a mass death for MSMEs," said Wientor.

To note, the Ministry of Trade (Kemendag) has ratified Regulation of the Minister of Trade Number 31 of 2023, which stipulates that social commerce platforms will only facilitate the promotion of goods or services and are prohibited from providing payment transactions.

In addition, the regulation also sets a minimum price of 100 US dollars per unit for foreign goods from abroad which are directly sold by merchants to Indonesia through cross-border e-commerce platforms.

This rule was made to protect MSME actors based on data from the Ministry of Cooperatives and SMEs as many as 67 million perpetrators.

Of the 67 million perpetrators, 22.81 million MSMEs were recorded on-boarding or digitizing online platforms. This number is close to the digitalization target set by the government, namely 30 million MSMEs in Indonesia in 2024.