Presidential Regulation Awaited To Resolve Indonesia's Online Transport Issues

Jakarta, Indonesia - The Indonesian government is finalizing a comprehensive regulatory solution for the nation's dynamic yet contentious online transportation sector. Following years of operational conflicts and regulatory gaps, the Presidential Palace has officially announced that a new Presidential Regulation (Peraturan Presiden or Perpres) is in the works. This high-level directive is intended to provide a definitive legal framework to govern all aspects of online transport services, including ride-hailing and delivery, bringing long-awaited clarity to businesses, drivers, and consumers alike.

The decision to use a Perpres stems from the need for a strong, overarching legal instrument that can synchronize rules across different ministries and regional governments. The current regulatory landscape is fragmented, often leading to conflicts between central government policies, local government ordinances, and the operational realities faced by companies like Gojek and Grab. A Presidential Regulation holds the highest power among government regulations, ensuring its provisions can effectively unify and supersede conflicting lower-level rules.

Key issues expected to be addressed include driver welfare and income stability, fare calculation mechanisms, vehicle and driver eligibility standards, and the legal status of online platforms. There have been persistent complaints from driver-partners regarding unfair income cuts, opaque algorithms, and a lack of social security protections. Simultaneously, conventional transport operators have long protested what they perceive as unfair competition from online services that do not bear the same operational costs or regulatory burdens.

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The formulation process involves multiple key stakeholders. Led by the Coordinating Ministry for Maritime Affairs and Investment, the drafting committee includes representatives from the Ministry of Transportation, the Ministry of Communication and Information Technology, the Ministry of Manpower, and industry associations. Crucially, the government has also engaged with driver cooperatives and unions to incorporate the direct concerns of hundreds of thousands of driver-partners whose livelihoods depend on the sector's stability.

This move is a direct response to President Joko Widodo's instruction to resolve the protracted issues plaguing the online transport industry. The sector, while celebrated for its innovation and convenience, has been marred by protests, legal battles, and policy uncertainty. By elevating the solution to a Perpres, the government signals the urgency and political priority of creating a sustainable and equitable digital economy ecosystem that supports technological advancement while ensuring social justice.

The impending regulation is also viewed as a necessary step to foster healthy competition and innovation. Clear rules on market conduct, data protection, and platform responsibilities are expected to provide legal certainty for both existing players and potential new entrants. This certainty is fundamental for attracting further investment into Indonesia's digital infrastructure and for encouraging platforms to develop new services that benefit the broader economy.

However, the drafting process faces significant challenges in balancing diverse and often opposing interests. Platforms argue for light-touch regulation that allows for flexibility and growth, while driver associations demand stronger income guarantees and labor rights recognition. Conventional transport groups continue to lobby for strict limitations on online vehicle numbers and operational areas. Crafting a Perpres that satisfies all parties without stifling the industry's dynamism will be a delicate task for policymakers.

As the draft Perpres enters its final stages, its content remains closely guarded. The government has indicated it aims to release the regulation in 2025 after thorough discussion and refinement. The success of this policy will ultimately be measured by its implementation on the ground—whether it can truly harmonize the sector, protect the vulnerable, and allow the digital transportation revolution to continue contributing positively to Indonesia's urban mobility and economic growth.

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Gojek Grab Indonesia Online Transport Regulation Online Motorcycle Taxis Presidential Regulation (Perpres) Transportation Ministry Policy