The government has been on high alert over the possible entry of Chinese e-commerce platform Temu, alleging that it could undermine local micro, small and medium-sized enterprises (MSMEs) and disrupt the country's supply chain.
Temu's business model of selling products directly from factories to consumers appears to contradict Government Regulation No. 29/2021 on trade, said Issi Karim, director general of the domestic trade department at the Ministry of Trade.
“Factory-to-consumer sales are not in line with our policy. Any activity from factory to consumer requires an intermediary, a distributor,” Ishi said on Wednesday as quoted by CNN Indonesia.
He vowed to “closely monitor the situation” even though Temu has yet to receive a license to operate in Indonesia.
Temu is a sister company of Chinese e-commerce giant Pinduoduo and was founded in September 2022 by China's PDD Holdings.
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The marketplace allows more than 80,000 suppliers, mostly from China, to sell directly to consumers overseas, The Associated Press reported last year.
