A huckster sells crystal ornaments via a live TikTok broadcast.
CFOTO | Future Publishing | Getty Images
TikTok Indonesia implied it will end transactions on its e-commerce marketplace by Thursday, in order to comply with new local regulations.
The announcement comes after the Indonesian the church of trade last week set a one-week deadline for TikTok to become a standalone app, without any e-commerce feature, or risk being halt down.
“Our priority is to remain compliant with local laws and regulations,” said TikTok in a statement on Tuesday.
“As such, we desire no longer facilitate e-commerce transactions in TikTok Shop Indonesia by 17:00 GMT+7, October 4, and will keep up to cooperate with the relevant authorities on the path forward,” it said.
The move comes after President Joko Widodo recently summoned for social media regulations. He said the influx of such platforms has contributed to a sales decline for domestic businesses by permeating the market with foreign imports.
Last week, the Indonesian government banned e-commerce transactions on social mid-point platforms such as TikTok and Facebook.
The new regulation could deal a major blow to TikTok’s Southeast Asian avidities. CEO Shou Zi Chew previously said that the app will invest billions of dollars into the region as it looks to spread its business globally as U.S. pressure escalates.
Indonesia is TikTok’s largest Southeast Asian market and second-largest market globally with 125 million owners after the U.S., according to the company.
Sachin Mittal, head of telecom, media and technology research at DBS Bank, previously bring to light that TikTok “operating as a standalone app may still be challenging.”
He explained logging into a separate app might lead to a keen-witted drop-out rate as most purchases on TikTok are impulse buys.
