09 Jun 2020
BPOM Moves to Regulate Indonesia’s Burgeoning Online Trade in Food and Medicines
Given the ever-increasing popularity of shopping at the click of a mouse, concerted efforts are now being made to regulate certain aspects of e-commerce that until recently were still ‘no man’s land’ in Indonesia, including the online sale and distribution of food and medicines.
As part of these efforts, the National Agency for Food and Drug Control (“BPOM”) recently issued BPOM Regulation No. 8 of 2020 on Supervision of the Online Distribution of Food and Medicines (“Reg. 8/2020”), which is aimed at protecting the public by laying down ground rules for the online distribution of medicines, traditional medicines, health supplements, cosmetics, processed food and food for special medicinal purposes (“FSMP”). Reg. 8/2020 defines the “online distribution of food and medicines” as any activity, or series of activities, that relates to the distribution and/or delivery of any of the above products via electronic transaction media, and sets out the requirements that must be fulfilled for the online distribution of each type of product, including the necessity of obtaining a marketing authorization (izin edar) from BPOM.
All those engaged in the online distribution of food and medicines must comply with the provisions of Reg. 8/2020 within 3 months of the regulation’s issuance.
Online Distribution of Medicines and FSMP
Under Reg. 8/2020, online distribution of medicines and FSMP may only be carried out by licensed pharmacies, which may cooperate with pharmaceutical electronic system providers (ESP). The regulation sets out the obligations of pharmacies and pharma ESPs when distributing their products online, including the obligation to verify prescriptions and dispensing requirements, and maintain records.
The following medicines are not permitted to be distributed by pharmacies and pharma ESPs:
- Certain prescribed medicines in accordance with the prevailing law;
- Medicines containing a pharmaceutical precursor;
- Erectile dysfunction medicines;
- Injecting supply for self-use, other than insulin;
- Implant supply, the usage of which requires healthcare practitioner assistance; and
- Drugs categorized as narcotics and psychotropics.
Reg. 8/2020 also explicitly prohibits the distribution of medicines and FSMP through social media, daily deals and classified ads.
Online Distribution of Traditional Medicines, Health Supplements and Cosmetics
A business engaged in the online distribution of traditional medicines, health supplements or cosmetics may use their own electronic system or a system provided by an ESP. However, the level of obligations that must be complied with is less than for online distribution of medicines and FSMP. Further, sellers must also comply with obligations to provide relevant information on products and ensure their safe delivery.
Prohibited from online distribution are online cosmetics with the following characteristics:
- Skin cosmetics containing more than 10% alpha hydroxy acid (AHA) content; and
- Teeth-whitening cosmetics containing and/or releasing more than 6% hydrogen peroxide content.
Online Distribution of Processed Food
In general, online distribution of processed food is less stringently controlled. Products must have a BPOM marketing authorization, except for: (i) ready-to-eat food, and (ii) processed food that is used as a raw material by food product manufacturers.
A business engaged in online distribution of processed food may use its own electronic system or a system provided by an ESP. They must:
- Display the name and address or identity of the seller of the processed food; and
- Display comprehensive information or an explanation on product labelling in accordance with the prevailing law.
Reg. 8/2020 explicitly prohibits businesses from distributing alcoholic beverages online.
Supervision and Sanctions
BPOM supervises the online distribution of food and medicines by:
- Monitoring the online distribution of food and medicines, including advertisements, on electronic systems, social media and other internet media; and
- Inspecting related facilities or those suspected of distributing food or medicines online.
Non-compliance with the provisions of Reg. 8/2020 is subject to BPOM administrative sanctions, which range from a written warning, recommendation for closure or blocking of an electronic system or social media account up to a recommendation that a pharmaceutical services facility permit be revoked in serious cases.
Reg. 8/2020 provides greater clarity to businesses, including startups, that sell food and medicines on e-commerce platforms. It also provides an opportunity for legitimate businesses to help suppress the flourishing trade in contraband / counterfeit food and medicines on Indonesian e-commerce platforms by allowing them to bring dodgy products to the attention of BPOM for follow-up action.
But most importantly, the regulation provides greater protection to the public when purchasing food and medicines online as such products must now have BPOM marketing authorizations.
It will be interesting to see how BPOM will enforce Reg. 8/2020 given that it has suffered years of inadequate funding to supervise the distribution of food and medicines. It could provide BPOM with a good opportunity to adopt a more proactive role in protecting the public in the emerging digital era.
Should you have any queries or require legal advice on how you can best protect your interests during this time of uncertainty, please contact any of the persons below, call us on +6221-2505125, or email us at firstname.lastname@example.org.
Mr. Emir Nurmansyah (email@example.com)
Mr. Nafis Adwani (firstname.lastname@example.org)
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 Peraturan Badan Pengawas Obat dan Makanan Nomor 8 Tahun 2020 tentang Pengawasan Obat dan Makanan yang Diedarkan Secara Daring
This edition of ABNR News and the contents hereof are intended solely to provide a general overview, for informational purposes, of selected recent developments in Indonesian law. They do not constitute legal advice and should not be relied upon as such. Accordingly, ABNR accepts no liability of any kind in respect of any statement, opinion, view, error, or omission that may be contained herein. In all circumstances, you are strongly advised to consult a licensed Indonesian legal practitioner before taking any action that could adversely affect your rights and obligations under Indonesian law.