Administrative Fines for Non-Compliance of Take-Down Obligation to User Generated Content Private Electronic System Organizers
On March 5, 2024, the Minister of Communication and Informatics (the “Minister”) issued Decree No. 172 of 2024 on Guidelines for the Implementation of Non-Tax State Revenues Deriving from the Imposition of Administrative Fines for Mandatory Fulfillment Violation of User Generated Content Private Electronic System Organizers to Perform Take-Downs (“Decree 172/2024”).
Based on the Minister’s Regulation No. 5 of 2020 dated November 16, 2020, but entered into force as of November 24, 2020, on Electronic System Organizers in the Private Sector as amended by the Minister’s Regulation No. 10 of 2021 dated November 10, 2021 (collectively, “Regulation 5/2020”), a User Generated Content (“UGC”) Private Electronic System Organizer (a “UGC ESO”) is a private Electronic System Organizer (an “ESO”) in which the provision, broadcasting, uploading and/or exchange of Electronic Information and/or Electronic Documents (collectively, the “Contents”) is conducted by the electronic system users. An example of a UGC ESO is an online application, such as Instagram, Twitter or X, and Facebook.
As electronic system users of UGC ESOs have full control in providing, broadcasting, uploading, and/or exchanging the Contents, they may potentially disperse the Contents that are prohibited by laws and regulations. In response to such potential issue, Regulation 5/2020 requires UGC ESOs to conduct moderation to ensure their electronic systems do not contain or facilitate the prohibited Contents, including to perform take-downs of any prohibited Content. UGC ESOs are subject to administrative fines in accordance with the applicable laws and regulations on non-tax state revenue, if they fail to perform the take-downs.
On that note, based on Government Regulation No. 43 of 2023 dated September 19, 2023, but entered into force as of November 19, 2023, on Types and Tariffs for Types of Non-Tax State Revenue applicable to the Ministry of Communication and Informatics (“GR 43/2023”), administrative fines acquired from UGC ESOs due to non-performance of the take-downs shall be considered Non-Tax State Revenues. However, Regulation 5/2020 and GR 43/2023 do not provide technical provisions related to the imposition of such administrative fines.
To supplement these regulations, Decree 172/2024 is issued. Decree 172/2024 sets out the technical provisions relating to (i) the formula to impose administrative fines, (ii) the procedure to impose administrative fines, (iii) the procedure for any objection to pay administrative fines, and (iv) the simulation to impose administrative fines.
In this Newsflash, we set out the key points of Decree 172/2024.
♦ Formula to Impose Administrative Fines
Decree 172/2024 stipulates that the formula to impose administrative fines on UGC ESOs shall be calculated based on the amount of violations points multiplied by the administrative fine tariffs. In this regard, the amount of violation points is determined based on the following formula:
Within the calculation of violation points, each index has a certain value ranging from 0 to 1 point as determined under Decree 172/2024. The following table provides a description regarding such indexes:
After the amount of violation points have been determined, it shall be multiplied with the administrative fine tariffs in the amount of Rp100,000 (one hundred thousand Rupiah) to determine the total amount of the administrative fines.
♦ Procedure to Impose Administrative Fines
Based on Decree 172/2024, administrative fines shall be imposed to UGC ESOs through the following procedural sequence:
♦ Objection to Pay Administrative Fines
Under Decree 172/2024, the UGC ESOs are given an opportunity to file an objection to pay the administrative fines imposed by the Minister. This is carried out through conveying an official written letter which consists of the following:
- the relevant Content that is not taken-down by the UGC ESO; and
- the assessment result that the relevant Content does not contradict with the laws and regulations.
Note that an objection may be filed by the UGC ESOs (i) after the second Warning Letter is received electronically, (ii) before the third Warning Letter is conveyed but has taken-down the prohibited Content and deliver payment commitment, or (iii) after the third Warning Letter is received electronically.
After the Minister receives the objection, the Minister shall conduct an examination by way of summoning the relevant UGC ESO to:
- report that the UGC ESO has allegedly violated the take-down obligation;
- provide an opportunity to hear the information, self-defense, and/or opinions from the UGC ESO; and
- inform the administrative sanctions that may be imposed due to the violation.
The Minister shall then notify the relevant UGC ESO regarding the result of the examination. In this case, administrative fines may still be imposed if the objection is rejected by the Minister.
♦ Simulation to Impose Administrative Fines
Decree 172/2024 also provides a simulation to impose administrative fines on private UGC ESOs as shown in the following table:
AKSET
Please contact Johannes C. Sahetapy-Engel (jsahetapyengel@aksetlaw.com), M. Fatih Satria Kasmaliputra (mkasmaliputra@aksetlaw.com), or Justin Amadeus (jamadeus@aksetlaw.com) for further information.
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