Indonesian antitrust agency probes Shopee, Lazada for suspected anti-competition breaches

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Indonesia's antitrust agency is reportedly investigating eCommerce platforms Shopee Indonesia and Lazada for violating anti-competition rules.

The companies are PT Shopee Internasional Indonesia, and PT Ecart Webportal Indonesia, which oversee the domestic operations of Shopee and Lazada respectively, according to Reuters.

The agency, known as Komisi Pengawas Persaingan Usaha (KPPU), has found that Shoppe stopped listing several delivery services it had previously used.

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According to KPPU in a statement, the eCommerce platform only left customers with two companies, namely J&T Express and Shopee Express, as options.

This violation, according to KPPU, has had a direct competitive impact on consumers. It also deemed the prioritisation of Shopee Express, an affiliate company, as an exclusionary practice.

In the same statement, KPPU added that the appointment of Handika Wiguna Jahja, director of PT Shopee International Indonesia, to become director of PT Nusantara Ekspres Kilat (SPX) on June 27, 2018, is also a violation of Article 19 Letter D and Article 25 Paragraph (1) Letter A of Law Number 5 of 1999.

Affiliate relationships through this dual position can influence the behaviour of affiliated business actors and business competition because they can ensure and control policies or behaviour of both companies, KPPU explained.

A Shopee representative said the company had complied with a request from the KPPU to attend a hearing but did not directly comment on the accusations, according to another report by Reuters. It reportedly added that the company is committed to complying with Indonesia's law.

A hearing was held on Tuesday (28 May), with the next hearing scheduled for 11 June 2024.

As for Lazada, the agency reportedly found early evidence of violations where the eCommerce platform had undertaken discriminative actions that could potentially inhibit competition.

This comes after Shopee was named the most popular eCommerce platform in Indonesia. According to a survey conducted by YouGov, Shopee is the most popular eCommerce platform in Indonesia with close to three in four (73%) consumers making purchases on the platform.

Tokopedia on the other hand comes in second with two in five (39%) consumers on it. Lazada comes third with 22%, and is followed by Bukalapak (6%), Blibli (5%) and Zalora (2%).

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