Shopee agrees to adjust courier service practices after admitting to violating Indonesia competition law News
FBenjr123, CC BY-SA 4.0, via Wikimedia Commons
Shopee agrees to adjust courier service practices after admitting to violating Indonesia competition law

Indonesia’s antitrust agency announced Wednesday that e-commerce giant Shopee and its courier service, Shopee Express, will make adjustments to its courier service practices in Indonesia after admitting to violating Indonesian competition laws.

The Komisi Pengawas Persaingan Usaha (KPPU), also known as the Indonesia Competition Commission, found that Shopee violated anti-competition rules by prioritizing its own courier service and excluding the listing of other delivery providers. This practice limited consumer choice to two options, including Shopee Express and another provider with a Shopee Indonesia executive on its board of directors.

The KPPU concluded that Shopee and Shopee Express breached Law No. 5 of 1999 on the Prohibition of Monopolistic Practices and Unfair Business Competition, specifically violating Article 19(d) and Article 25(1). Article 19(d) prohibits businesses from engaging in discriminatory practices against other businesses that may cause monopolistic practices or unfair competition. Article 25(1) prohibits businesses from using a dominant position to prevent or impede consumers from obtaining competitive goods or services, restrain market and technology development, or hinder other potential business actors from entering the market.

The KPPU said in a statement that “Shopee and Shopee Express admitted that they had violated Law No. 5 of 1999, regarding delivery (courier) services on the Shopee platform by agreeing to various behavioral change points determined by the KPPU Council in the hearing yesterday.”

Radynal Nataprawira, head of public affairs at Shopee Indonesia, explained in an email to CNBC:

Shopee Indonesia attended a meeting with KPPU on June 25 to discuss points of the integrity pact that was shared by KPPU last week. On June 20, Shopee proposed changes to our user interface to enhance our services and demonstrate our compliance in providing the best services to our users, in accordance with the feedback provided and approved by the KPPU.

Nataprawira also stressed Shopee’s commitment to legal compliance, stating, “Shopee is always committed to complying with all applicable regulations and laws in the Republic of Indonesia in conducting our business operations.”

Shopee is the largest e-commerce platform in Southeast Asia, with 343 million monthly visitors. Approximately 60 percent of Shopee users are based in Southeast Asia, with Indonesia being the largest single market, comprising over 100 million users.

The next hearing in the case is set for July 2.

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