New Internet Businesses Rules in Indonesia

  • By:Tim Slingschröder
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The Minister of Communication and Information has declared that the service will give new guidelines to suppliers of versatile application/web content suppliers. This proposed guideline will cover the accompanying:

a. Consistence with existing laws:

Law No. 5 of 1999 on the Prohibition of Monopolistic Practices and Unfair Business Competition

Law No. 7 of 2014 on Trade

Law No. 8 of 1999 on Consumer Protection

Intellectual property rights.

b. Sifting of substance as per Law No. 44 of 2008 on Pornography, and related government regulations.

c. Blue penciling of negative substance under Minister of Communication and Information Regulation No. 19 of 2014 on Controlling Internet Websites Containing Negative Content.

d. Utilization of Indonesian legitimate elements for getting installment through “public installment gateway”.

e. Utilization of Indonesian Internet Protocol (IP) addresses.

read also: Indonesian trademarks: when is a trademark considered “provocative

This most recent endeavor to manage web administrators is accepted to help with charge income assortment that is focused at installment stream to web organizations outside Indonesia. In a roundabout way it likewise looks to limit online operations.

The guideline is probably going to affect unfamiliar based sites which get installments from Indonesian clients. The major worldwide web organizations keep up restricted neighborhood existences in Indonesia, with exercises restricted to promoting. A typical reason from web organizations is their absence of lawful assurance when not building up significant business capacities in Indonesia, for example, installment processing.

This latest attempt to regulate internet operators is believed to help with tax revenue collection that is targeted at payment flow to internet businesses outside Indonesia. Indirectly it also seeks to localize online operations.

The regulation is likely to impact foreign-based websites which receive payments from Indonesian users. The major global internet companies maintain limited local presences in Indonesia, with activities limited to marketing. A common excuse from internet businesses is their lack of legal certainty when not establishing important business functions in Indonesia, such as payment processing.

 These businesses often use Singapore as a third party to process payments. Businesses must comply with proposed requirements for receiving payment within Indonesia, therefore the tax authority will be in a better position to trace and audit such receipts that previously were channeled out of Indonesia. This is why, it is recommended to registering a business or applying trademark Indonesia, before business owners having problems with Indonesian authorities.

Past endeavors to manage web organizations didn’t advance far. In 2014, the government provided a lot of draft guidelines to control web administrators. Organizations restricted these draft guidelines as a result of excessively prescriptive principles, for example, the requirement for affirmation, enrollment and situating of server farms in Indonesia. Accordingly, these guidelines never passed.

Online organizations should screen the language of the most recent proposed draft guidelines once gave to more readily comprehend their effect.

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