TikTok Suspends Shopping Platform in Indonesia as Government Implements New Regulations

TikTok, owned by ByteDance, has suspended its shopping platform in Indonesia to adhere to new government regulations. The move comes after Jakarta announced that tech companies must separate their e-commerce offerings from their social media apps, effectively banning buying and selling on platforms like TikTok and Facebook. This decision is significant as Indonesia is TikTok’s second largest market, with around 125 million users. ByteDance had previously invested billions of dollars in the country to expand its social e-commerce services.

E-commerce is crucial to TikTok’s business, with consumer spending on Douyin, its Chinese counterpart, increasing by 76% year-on-year to reach $195 billion in 2022. While TikTok Shop is also available in other Southeast Asian countries like Singapore and Vietnam, it faces competition from established players like Shopee and Lazada, which is majority-owned by Alibaba. TikTok Shop, which recently launched in the US, has faced pushback due to low-quality offerings and concerns about data sharing.

TikTok is not only contending with regulatory challenges in Indonesia but also grappling with national security concerns in the US. Although the app is already prohibited on government devices, there are discussions about completely banning TikTok due to its perceived risk. These challenges highlight the obstacles TikTok will face as it seeks to replicate its Chinese success on a global scale.

Source: New rules from Jakarta are dealing a blow to TikTok’s e-commerce dreams