Perpres Roadmap for E-commerce, the Government's New Way to Make Rules Clear

The government has finally made a new breakthrough in making rules to realize Indonesia's target as the largest digital economy country in Southeast Asia by 2020 with a value of US$130 billion, as stated in Presidential Regulation No. 74/2017 concerning the Roadmap of the National Electronic-Based Trading System (E-Commerce Roadmap) for 2017-2019.

Minister of Communication and Information (Menkominfo) Rudiantara said the Presidential Regulation was a new way for the government to clarify the direction of the rules. It contains 26 programs that must be realized by the government. The timeframe given is starting from this year to 2019.

There will also give mandates to each ministry, what they have to complete. Technically, all of these programs will be led directly by the Coordinating Minister for Economic Affairs.

"This is a new way for the government to make let's go to clear. Usually the government will say, 'yes, it will go that way'. There [the Presidential Decree] is clear where to go," he said, Thursday (10/8).

Rudiantara continued this policy into a comprehensive and transparent roadmap. So it must be done together, not only from the government, but with industry players.

"The public can charge the government, 'This regulation must be issued within two months, how? progress-his?'"

Basically, beleid regulates seven things to be resolved. These are funding, taxation, consumer protection, education and human resources (HR), cyber security, and the establishment of implementing management.

Funding issues

The government plans to provide additional access for online entrepreneurs by utilizing people's business credit funds (KUR) with a credit risk assessment that is adapted to the e-commerce business model. If the regulations are not delayed, it is planned that this policy will be published in October 2017.

In the same month, it is planned to issue regulations regarding the use of funds Universal Service Bond (USO) for digital SMEs, e-commerce startups located in disadvantaged, remote, and outermost (3T) areas.

Then in the following month, published the rules regarding tenant e-commerce platform developers become recipients of KUR funds distributed by banks and non-banks. Next, the rules regarding funding assistance for business incubator organizers who receive grant funds, sourced from CSR funds from BUMN or similar companies.

Another source of funds, the rules of which will be reduced in the same month, is the use of crowdfunding financing schemes. Aims to provide protection to investors and reduce the risk of the company itself.

The government is also preparing a new regulation containing a capital participation scheme for potential e-commerce companies through angel capital or venture capital.

Creating DNI for e-commerce

In October 2017, the government plans to add two standard classifications of Indonesian business fields (KLBI) to the Negative Investment List (DNI) for companies that represent businesses e-commerce, marketplace, digital ads, on demand services, and others.

The government opens opportunities for foreigners who enter Indonesia with an investment value of up to Rp. 100 billion, the maximum ownership is 49%. Meanwhile, for an investment value of more than Rp. 100 billion, they can control a maximum of up to 100% ownership.

Tax issues

Tax rules prepared by the government, in the form of simplifying the fulfillment of tax obligations. Possibly, the tax regulations are only intended for entrepreneurs with a turnover below IDR 4,8 billion per year. This rule will be published in December 2017.

In the previous month, the government planned to issue regulations in the form of tax incentives for venture capital companies that invest in companies that meet certain criteria, including e-commerce companies.

Meanwhile, e-commerce services originating from foreign companies will also receive equal tax treatment. This rule is planned to be published in February 2018.

Comprehensive and transparent

From some of the issues above, it can be seen that the government's efforts are quite comprehensive to support Indonesia's digital economy going forward. The only thing that matters is whether the government can complete all programs on time according to the completion targets set out in the regulation.

As part of the industrial ecosystem, we need to control all progress monitoring, and providing input on what points need to be considered so that the initial enthusiasm remains.