Reasons For Entrepreneurs To Challenge Regulations Prohibiting Imports In e-Commerce According to the Head of the Entrepreneurs Association

Reasons Entrepreneurs Challenge Import Prohibition Regulations in e-Commerce

YOGYAKARTA - The regulations regarding banning imports from e-commerce seem to have pros and cons. Because the impact of Minister of Trade Regulation No.31/2023 on the Supreme Court (MA) emerged, this made entrepreneurs try to sue it. What is the reason for entrepreneurs to challenge the rules prohibiting imports in e-commerce?

The reason is that currently Sony Harsono, Chair of the E-Commerce Logistics Entrepreneurs Association (APLE), is challenging this regulation. The Judicial Review that has been submitted is related to Article 19 paragraphs 1-4 which discusses the issue of a ban on importing goods under US$100 or if converted into rupiah around Rp. 15 million via e-commerce.

Reasons for Entrepreneurs to Challenge Import Prohibition Regulations in e-Commerce

In Sonny's opinion, the import ban in the regulation is not based on clear research. For the first reason, Sonny said that APLE agreed that there was no correlation between import violations and MSMEs. This is because imports under US$100 in e-commerce can become raw materials for small MSMEs to produce and add value.

"Not only is this prohibition detrimental to the country and MSMEs, it also violates the principles of international trade agreed at the WTO," said Sonny in his statement, Tuesday (21/11/2023).

The next reason, Sonny said, was that since Minister of Trade Regulation No. 31/2023 implemented at the end of September 2023, has resulted in layoffs (PHK) in the logistics industry and the courier service provider industry related to import activities via e-commerce.

APLE claims that there are at least 1,000 workers at the airport and 5,000 workers in supporting zones, such as couriers and warehouses who have become victims of this regulation. Moreover, Sonny said, the ban on importing goods under US$100 in e-commerce has caused the closure of 5 large logistics companies as well as dozens of branches of courier and warehousing companies in several regions.

"The direct impact of Minister of Trade Regulation No. 31/2023 is state losses where e-commerce imports that have been closed generate approximately IDR 5 trillion per year from import taxes and VAT. This does not include business income tax from each industry forced to close as well as personal income tax from "From APLE's calculations, the state losses totaled IDR 10 trillion per year for workers who were laid off," added Sonny.

According to Sonny, the phenomenon of empty physical markets such as Tanah Abang Market is due to changes in people's shopping behavior today, which is choosing to be online-based. Therefore, Sonny asked the government to review the policy regarding restrictions on e-commerce imports.

Moreover, he admitted that he had written to Minister Teten Masduki regarding the impact of import restrictions via e-commerce as Minister of Cooperatives and Small and Medium Enterprises (Menkop UKM). For him, import restrictions would risk increasing illegal imports.

For example, said Sonny, the ban on cross-border imports for 13 Muslim clothing items for 2 years has actually exacerbated predatory pricing. Before the ban, according to Sonny, the price of these objects was still almost the same as the price of domestically produced objects. However, currently the cost is 10% of the domestic production price.

"The main problem is illegal importation which will increase even after the ban is implemented and this will be very detrimental to the state and also detrimental to society," said Sonny.

Sonny and APLE hope that the Supreme Court can provide a wise decision by eliminating Article 19 paragraphs 1 to 4 of Minister of Trade Regulation Number 31/2023 in order to restore the livelihoods of logistics workers who have been laid off so far.

So after finding out why entrepreneurs are challenging the rules prohibiting imports in e-commerce, check out other interesting news on VOI.ID, it's time to revolutionize the news!