Indonesia, the world's fourth-most-populous country, has decided to ban social commerce – the practice of embedding e-commerce facilities in social media platforms.regulations that limit social media to promoting goods and services and barring them from accepting payments.
The regulation also aims to address concerns that social commerce promotes imports at the expense of local manufacturers. That argument is potent, because one of the biggest social commerce players in Indonesia is TikTok – which rates the developing nation its top e-commerce market, and audience, outside China. TikTok argues that its social commerce offering represents an opportunity for local retailers to drive traffic through their doors, or spark sales online.
The regulation means social media operators will be able to continue offering payment and e-commerce services, but will have to run them as discrete operations. Retailers could conceivably therefore choose to promote their wares on a social network, and to use the same service provider's e-commerce facilities – but those facilities would not be linked.