The second amendment to Indonesia's Electronic Information and Transaction Law (EIT Law), enacted on 2 January 2024 ("Second Amendment"), brings about significant changes aimed at enhancing online child safety, bolstering the security of high-risk electronic transactions, and clarifying legal parameters for international electronic contracts. Notably, the Second Amendment requires electronic system operators ("ESOs") to implement (i) measures safeguarding children from harmful online content; (ii) age verification systems; and (iii) and accessible reporting channels for misuse. Moreover, it compels the use of certified electronic signatures for high-risk transactions and designates Indonesian law as governing law in international contracts under specific conditions, aiming to foster legal clarity and consumer protection in cross-border transactions.
However, while the Second Amendment introduces essential safeguards and regulations, clarity on certain aspects remain pending, such as the definition of standard clauses and enforcement mechanisms for non-compliance. Nonetheless, businesses are urged to adopt proactive compliance measures despite awaiting further implementing regulations.
Furthermore, the Second Amendment strengthens government supervision over prohibited online content, empowering civil service investigators to order ESOs to block offenders' assets linked to criminal activities. It also refines the definition of prohibited content, emphasising the intention to disseminate content violating decency or containing false information resulting in material consumer losses. These measures reflect Indonesia's commitment to curbing online harms, combating fraud, and ensuring the integrity of electronic transactions. However, the effectiveness of these regulations hinges on comprehensive implementation strategies and clear enforcement mechanisms. Therefore, businesses operating within Indonesia's digital landscape must navigate evolving regulatory frameworks, prioritise compliance, and remain vigilant in adapting to forthcoming guidelines to mitigate legal risks and uphold consumer trust in the digital realm.
For more information, click here to read our Legal Update.
