The New Game Rules for E-Commerce Businesses in Indonesia

The Indonesian Government has changed the regulatory framework for e-commerce (Perdagangan Melalui Sistem Elektronik or PMSE) through Minister of Trade Regulation No. 19 of 2026 on the Conduct of Trade Business Through Electronic Systems ("MoT 19/2026"). This regulation revokes Minister of Trade Regulation No. 31 of 2023 on Business Licensing, Advertising, Guidance, and Supervision of Business Actors in Trade Through Electronic Systems ("MoT 31/2023").

MoT 19/2026 does not merely replace the previous legal framework, but also expands its scope, from a framework primarily focused on licensing and advertising into a more comprehensive regime governing e-commerce activities. For business actors, the regulation introduces several new obligations that warrant close attention. The following are the key changes we consider most critical.

Expansion of Business Models and Scope of Business Actors

Article 3 of MoT 19/2026 adds two (2) new business models for e-commerce operators (Penyelenggara Perdagangan Melalui Sistem Elektronik or "PPMSE"), namely Ride Hailing and Online Travel Agent, complementing the business models already previously recognised under MoT 31/2023, such as online retail, marketplace, and social commerce. This addition affirms that online transportation and travel service ecosystems are now recognised as PPMSE and therefore subject to the corresponding obligations, including complaint-handling mechanisms, digital advertising, anti-price manipulation, and domestic product prioritisation. As such, companies operating ride-hailing or travel platforms that previously sat outside the express model list should reassess their classification.

Tightening of Merchant Protection and Business Licensing Obligations

MoT 19/2026 tightens business licensing and merchant protection requirements. Under Article 17(3) of MoT 19/2026, PPMSE are now required to provide registration assistance for merchants and a registration feature labelled "Undergoing Authorisation" (Dalam Proses Legalisasi) for merchants that have not yet obtained the required business licence, allowing them up to 6 (six) months to complete the process. Should that period lapse, the PPMSE must restrict the merchant's access by suspending the merchant's ability to conduct transactions through the platform.

In addition, the regulation introduces several obligations not previously governed under MoT 31/2023, including the obligation for PPMSE to provide a complaint-handling service and a dispute resolution mechanism for merchants under Articles 10 and 11, as well as to disclose all fee components charged to merchants in a transparent manner and to set them out in a written agreement and/or electronic contract under Article 14(1) and (2).

Assertive Prioritisation of Domestic Products

While MoT 31/2023 encouraged the promotion of domestic products, MoT 19/2026 elevates this policy into a more affirmative obligation. Under Article 40(3)(a), PPMSEs are now required to prioritise the display of domestic products at the top of their main page, particularly those produced by Micro and Small Enterprises. The regulation also paves the way for granting reductions in promotional and advertising costs, and/or other incentives, to MSEs selling domestic products on particular days, pursuant to Article 37(1)(c).

Regulation of Artificial Intelligence in E-Commerce Activities

One of the most significant developments is the introduction of provisions governing the use of Artificial Intelligence ("AI") in e-commerce activities. Business actors deploying AI are required to clearly label or disclose AI-generated goods and/or services, ensure that the information provided to consumers is accurate, and safeguard consumer protection, personal data, and intellectual property rights.

Further requirements regarding the use of AI by e-commerce business actors are subject to other relevant laws and regulations; this would include existing regulations such as the PDP Law and Electronic Information & Transactions Law, as well as, in the future, the Draft Presidential Regulation on AI Ethics currently being prepared by the Indonesian government.

Other Provisions

Several other provisions further reinforce this new regulatory framework. These include:

• Article 33(4): PPMSE are prohibited from facilitating the creation of new accounts or the renaming of existing accounts for business actors whose account access has been terminated under the same business licence.
• Article 74: Merchants who have already conducted its operations through a PPMSE before MoT 19/2026 came as well as a transitional period of up to eighteen (18) months for merchants that were already operating before the regulation came into effect to comply with applicable licensing obligations.

Conclusion

MoT 19/2026 marks a new chapter in the regulation of digital trade in Indonesia, with an emphasis on licensing compliance, the protection of merchants and consumers, the prioritisation of domestic products, and the anticipation of technological developments such as AI. For business actors, the regulation calls for a review of their respective business models, systems, and internal compliance.

Business actors should promptly review their operations and ensure compliance with the new requirements under MoT 19/2026. Should you have any questions or require assistance in assessing how this regulation impacts your organisation, please do not hesitate to contact us at [email protected] and [email protected].