Heaptalk, Jakarta — The Business Competition Supervisory Commission (KPPU) is investigating the Lazada e-commerce platform regarding alleged cases of monopoly on goods delivery services. The Commission discovered indications of violations of Law No. 5/1999 concerning the prohibition of monopolistic practices and unfair business competition by this e-commerce platform.
“Lazada is indicated to have carried out discriminatory actions that have the potential to hamper competition and are even indicated to be detrimental to customers,” affirmed Head of KPPU, Fanshurullah Asa. (05/27)
Since 2021, evidence has been tracked down from KPPU supervision to be upgraded to the investigation phase. In this process, the KPPU will collect two pieces of evidence related to the alleged violation to determine whether the authority will perform further investigation, such as the filing and trial stage, or whether the case will not be continued due to insufficient proof. If the KPPU finds any violations, Lazada will be subject to sanctions based on Law No.5/1999.
“If we discover a violation, Alibaba’s e-commerce platform may be subject to a fine of a maximum of 50% of net profits or 10% of total sales obtained in the relevant market during the period of the violation.” Head of KPPU said.
Concurrently, KPPU has also examined Shopee regarding the alleged same case as Lazada, prioritizing Shopee Express. The KPPU’s investigators also perceived allegations of discriminatory algorithmic system settings by Shopee to prioritize Shopee Express logistics services in every package delivery to buyers.
This authority also suspects that Shopee’s two-year turnover increase was due to indications of monopolistic practices in logistics services. Regarding Shopee’s alleged violations, Fanshurullah explained that the issue had entered the stages of the initial assembly session on May 28, 2024.
“Based on this issue, PT Shopee Indonesia has discriminated in selecting delivery services activated automatically in bulk on the seller dashboard. This issue has caused direct harm to consumers and exclusionary practices by prioritizing SPX, its affiliate, in the competition for delivery services on the platform.” The KPPU’s investigator affirmed, as cited in Kontan. (05/28)
As is known, Lazada possesses LEX, which was established in 2015. This service, which covers more than 500,000 square meters, has been operated in multiple countries, including Indonesia, Malaysia, Vietnam, Thailand, Singapore, and The Philippines. Meanwhile, Shopee provides multiple logistic services, spanning SPX Standard, Same Day, Instant, and SPX Pick up on the spot service.