Indonesia-based GoTo and Bytedance-owned TikTok have announced their commitment to fully comply with the regulation that prohibits in-app transactions on social media platforms in the country before the end of April.

Compliance Progress Update

GoTo's Chief Executive, Patrick Walujo, provided an update during a business presentation, highlighting that the process of ensuring compliance is almost complete. He stated that they anticipate full compliance within the next 1.5 months.

Financial Arrangements

In light of the merger between Tokopedia e-commerce arm and TikTok Shop Indonesia, GoTo will begin to receive quarterly e-commerce service fees from Tokopedia. These fees will be determined on a sliding scale based on a percentage of the gross merchandise value, enhancing GoTo's cash flow immediately without further dilution of ownership in Tokopedia.

Impact of Regulation on Sales

Indonesia's ban on e-commerce transactions via social media platforms last year had initially hindered TikTok's sales ambitions in the country. However, the partnership with GoTo has paved the way for compliance with regulations.

Stock Performance

Following the regulatory compliance update, GoTo's shares witnessed a 6.25% decrease, closing at 75.00 rupiah on Wednesday.

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