INDONESIA Trends and Developments Contributed by: Vovo Iswanto, Albert Boy Situmorang, Wisnu Wardhana and Ingrid Gratsya Zega, Assegaf Hamzah & Partners
Introduction The rules and policies on consumer protection in Indonesia are fragmented, with regulations issued at different levels and by various authori - ties, depending on the type of product involved. Nonetheless, the preliminary framework for con - sumer protection law in Indonesia is set out in Law No 8 of 1999 on Consumer Protection (the “Consumer Protection Law” ). This law establish - es the rights and obligations of both consum - ers and businesses, outlines several prohibited conducts, and sets out applicable sanctions for violations. Under the Consumer Protection Law, busi - nesses have several key obligations to ensure fair treatment and transparency for consumers, including: • providing accurate, clear and honest informa - tion about products, including their condition, warranty, and instructions for use, repair, and maintenance; • treating all consumers fairly, respectfully and without discrimination; • allowing consumers to test or try certain products when appropriate, and providing clear guarantees and warranties; • offering compensation or refunds for harm caused by the use, consumption, or applica - tion of goods or services or if such goods or services do not match what was promised; and • recalling products if they are found to be unsafe or non-compliant with applicable laws and regulations. In addition to the Consumer Protection Law, sec - tor-specific regulations provide more detailed or distinctive rules for consumer protection in vari - ous industries. For instance, consumer protec - tion in the financial sector is governed by Law
No 4 of 2023 on the Development and Strength - ening of the Financial Sector. In the automotive industry, consumer protection is regulated under Minister of Trade Regulation No 21 of 2023 on the Determination of Business Activity and Prod - uct Standards in the Implementation of Risk- Based Business Licensing in the Trade Sector. This regulation sets out requirements relating to aftersales services and spare parts, product labelling, and the provision of user manuals in Indonesian for specific products. Given the dynamic nature of consumer protec - tion laws in Indonesia, businesses should stay informed about laws and regulations that are relevant to their businesses, including new laws and draft bills currently under discussion. Regu - larly reviewing and updating business practices and policies is essential to ensure ongoing com - pliance. In the following sections, the authors set out recent and notable updates that businesses should be aware of in order to understand poten - tial changes in the legal landscape, assess their impact, and, if necessary, prepare and imple - ment appropriate compliance strategies. No Proof of Fault Needed: Proposed Strict Liability for Defective Products in the Draft Bill on Consumer Protection The Indonesian government, along with the parliament, is currently amending the Con - sumer Protection Law. One of the key proposed amendments is the implementation of a strict liability regime for defective products. Under the current framework, manufacturers or importers generally bear responsibility for the products they sell or import in Indonesia. However, if distributors, intermediaries, or sell - ers modify or change a product in any way, they
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