GoTo, TikTok compliance with Indonesia’s trade regulation nears 100%, says GoTo CEO
INDONESIAN tech company GoTo and Chinese-owned partner TikTok will be wholly compliant in a month and a half with the South-east Asian nation’s regulation that bans in-app transactions on social media, GoTo’s chief executive officer said on Wednesday (Feb 28).
Short video app TikTok acquired in December majority shares in GoTo’s e-commerce unit Tokopedia after the Indonesian trade ministry banned transactions on its TikTok Shop e-commerce unit.
“Integration process is going well. All parties continue to communicate with the related ministries and as far as we know the process is nearing completion,” CEO Patrick Walujo said in an online briefing.
Indonesian minister for small and medium enterprises Teten Masduki said last week TikTok had yet to comply with the regulation.
TikTok, owned by Chinese company ByteDance, did not immediately respond to a request for comment. Following December’s deal, TikTok has reopened its e-commerce services, which are now facilitated by Tokopedia.
GoTo’s management said in the briefing that it will receive a quarterly e-commerce fee from Tokopedia, with the sum being dependent on Tokopedia’s gross merchandise value (GMV).
Based on a GMV of US$2.9 billion recorded in the third quarter of last year, the e-commerce service fee for GoTo will be US$11.4 million, said the company.
GoTo also expects its partnership with TikTok will benefit not only its e-commerce business, but also its financial services segment as it will be able to offer digital payments and “buy now, pay later” credit schemes on TikTok. REUTERS
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