Indonesia’s antitrust agency is investigating Lazada’s Shopee for suspected anti-competition violations

Indonesia’s antitrust agency is reportedly investigating e-commerce platforms Shopee Indonesia and Lazada for violating anti-competition laws.

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

The agency known as Komisi Pengawas Persaingan Usaha (KPPU) discovered that Shoppe had stopped displaying several delivery services it had previously used.

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

According to the KPPU, this infringement had a direct impact on competition on consumers. It also found that the prioritization of Shopee Express, an affiliated company, constituted an exclusionary practice.

In the same statement, KPPU added that the appointment on June 27, 2018 of Handika Wigun Jahja, director of PT Shopee International Indonesia, as director of PT Nusantara Ekspres Kilat (SPX) also constitutes a violation of Art. 19 lit. D and art. 25 Paragraph (1) Letter A of Act No. 5 of 1999

Affiliate relationships through this dual position can influence the behavior of related business entities and business competition because they can provide and control the policies or behavior of both companies, KPPU explained.

Another Reuters report said a Shopee representative said the company had complied with KPPU’s request to attend the hearing, but did not comment directly on the allegations. She reportedly added that the company was committed to complying with Indonesian law.

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

As for Lazada, the agency reportedly found early evidence of violations in cases where the eCommerce platform took discriminatory actions that could potentially inhibit competition.

This comes after Shopee was recognized as the most popular eCommerce platform in Indonesia. According to a survey by YouGov, Shopee is the most popular eCommerce platform in Indonesia, with almost three out of four (73%) consumers shopping on the platform.

In second place is Tokopedia, used by two out of five (39%) consumers. Lazada ranks third with 22%, followed by Bukalapak (6%), Blibli (5%), and Zalora (2%).

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