CNA Explains: What do Indonesia’s new licensing rules mean for tech companies?

CNA Explains: What do Indonesia's new licensing rules mean for tech companies?

JAKARTA: Indonesia has asked technology companies, both at home and overseas, to sign-up themselves by Wednesday night time (Jul 27) when they want to continue to run in the country.  

The government has warned that businesses that do not register in time would be clogged.

As of Wednesday afternoon, just under 9, 000 entities – 8, 500 of which are local firms – have authorized themselves via a website run by the Indonesian Communication and Information Technology Ministry. Among those that have signed up include tech giants Alphabet Incorporation, Meta Inc plus Twitter Inc.

But there are many some other technology companies that have not registered and so are therefore at risk of becoming banned from providing their services within the archipelago. Among these companies are some of the world’s biggest e-commerce solutions, web browsers and social media platforms.

The brand new licensing regulation applies to local and foreign companies which offer providers ranging from search engines, social media, streaming services and fintech to email providers, messaging programs and online games.

Observers are worried the fact that ministerial regulation on Electronic System Providers will stifle innovation as companies very first have to be licensed by the communications ministry before they can start offering their services to users in Philippines.

Meanwhile, experts warned that the regulation poses a threat to freedom associated with expression and privacy as it allows legislation enforcers and federal government agencies to monitor the particular platforms and order tech firms to eliminate content deemed as unlawful.

WHAT THE REGULATION IS ABOUT 

Passed within November 2020, the particular ministerial regulation on Electronic System Providers, known in Philippines by its reduction PSE, requires technologies firms to provide a general outline of how their particular systems work. Companies also need to disclose the kind of user personal information they are storing and processing.

However , the government did not start enforcing this requirement until recently because of the outbreak.  

The particular communications ministry states that the regulation is simply administrative in nature.

“This is just so that we know who may be operating digitally within Indonesia and the type of services they provide. Unless (these companies) are committing a corporate crime, they have nothing to fear, ” the ministry’s director common for applied details sciences, Semuel Pangerapan said during a push conference last week.

But the regulation also stipulates that technologies firms must provide access to law enforcement plus government agencies so they can better monitor their platforms.

Authorities agencies can also order companies to take straight down content that is violating Indonesian law or deemed to be “disturbing public order”. This kind of content needs to be eliminated between four plus 24 hours.

Companies must also agree to provide law enforcement and federal government agencies with the personal data of particular users on the systems.

WHY THERE ARE CONCERNS

There were concerns over the affects of the regulation.

“We feel that the phrase ‘disturbing public order’ is too broad… and can be used by government agencies to control peaceful criticisms directed at the authorities, ” advocacy group Southeast Asia Freedom associated with Expression Network (SAFEnet) said in a declaration last month.

Technology experts also have expressed the same problems, saying that the rules allows the government in order to invade people’s personal privacy as it enables observance agencies to look at personal e-mails, messages and even documents stored in cloud platforms.

“Accessing such information should be done for investigation reasons only and the choice has to be made by the court of legislation, ” Pratama Dahlian Persadha, chairman of research firm Conversation and Information System Security Research Middle, told CNA on Tuesday.

Presently, the regulation says that such gain access to can be given to get “monitoring and police force purposes”. It does not point out the need to secure a court order.