Indonesia bans Chinese app that was the most downloaded app in the US in 2023

Indonesia will continue to ban e-commerce platform Temu, citing concerns it could harm small businesses in the country. According to a report by Channelnewsasia, Minister of Communications and Information Technology Budi Arie Setiadi said Temu’s business model, which involves selling directly from factories to consumers, violates Indonesian trade laws requiring intermediaries. He emphasized that the admission Ago activities would have a negative impact on the economy and society, especially on small and medium-sized enterprises.
The Indonesian government is closely monitoring Temu’s attempts to enter the Southeast Asian market. Platform owned by PDD holdingshas faced numerous failed registration attempts due to trademark conflicts and non-compliance. It was the most downloaded iPhone app in the US in 2023. The Chinese shopping app has taken over the spots previously held by US tech giant Facebook parent company Meta. Under the slogan “Shop like a billionaire,” Temu has reportedly captured nearly 20% of the U.S. market share, challenging traditional U.S. retailers such as Amazon.com, Dollar Tree Inc and Five Below Inc.

Business model Against Indonesian regulations

Temu’s business model of selling products directly from factories to consumers is said to be contrary to Indonesian trade laws requiring an intermediary or distributor, Isy Karim, director general of domestic trade at the Ministry of Commerce, said earlier. Minister Budi said that allowing Temu into Indonesia could harm the economy and society.
The Temu app became a topic of discussion after the company’s appearance at the E-commerce Expo 2024, which took place on September 24 and 25 in Greater Jakarta.
Ago, available in about 60 countries, launched in Southeast Asia last year, starting with the Philippines last August and Malaysia last September. In July this year, it expanded its operations to Thailand. In October 2023, Indonesia also banned TikTok Storeciting the need to protect smaller sellers and user data.