Chinese short video app TikTok is still violating Indonesia’s rule that bans in-app transactions, a cabinet minister said, Reuters reported on Tuesday.
Teten Masduki, the Indonesian minister for small and medium enterprises (SMEs), who spoke frequently against TikTok Shop prior to last year’s ban, told reporters that TikTok still had not complied with the regulation.
“The trade minister has to reprimand TikTok so that it complies with the regulation, if not then … the government’s authority is undermined,” he was quoted as saying.
The trade ministry also said it was still considering how best to respond to the issue.
A TikTok representative in Indonesia did not immediately respond to a Reuters request for comment.
TikTok had been forced to close its newly-introduced e-commerce service, TikTok Shop, in Indonesia after the country banned online shopping on social media platforms last year, citing the need to protect smaller merchants and users’ data, the report added.
Indonesian tech conglomerate GoTo said last month that TikTok, owned by China’s ByteDance, had completed a deal agreed in December to buy 75.01 percent of Tokopedia for $840 million.
According to the statement then, TikTok has committed to invest over $1.5 billion in the enlarged entity over time, to provide future funding required by the business, without additional dilution to GoTo.
The arrangement will allow both TikTok and GoTo to each serve Indonesian consumers and MSMEs more comprehensively.
GoTo will benefit from the growth of the enlarged entity and will remain an ecosystem partner to Tokopedia, through its digital financial services via GoTo Financial and on-demand services via Gojek.
GoTo will also receive an ongoing revenue stream from Tokopedia commensurate with its scale and growth.
The strategic partnership will commence with a pilot period carried out in close consultation with and supervision by the relevant regulators.
The first campaign will be the Beli Lokal initiative which will launch on Dec 12, coinciding with Indonesia’s National Online Shopping Day (Harbolnas) – a government program designed to grow Indonesia’s digital economy by supporting local MSMEs.
TikTok said last year it intended to invest billions of dollars in Southeast Asia, including Indonesia, the region’s biggest economy.