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Indonesia Game Companies Need To Register With Local Government [Update]: Steam, Epic Games, PayPal Banned In Country

[Updated August 2 2022]

Game services such as Steam, Epic Games and PayPal are now accessible in Indonesia, according to the Indonesian Ministry of Communication and Information (Kominfo) through an announcement on its Twitter account.

At time of writing, the following services; PayPal, Valve and Yahoo! are now accessible to its users. However, at time of writing, no news on Epic Games’ return. We’ll keep a lookout on that one.

[Original report below]

Game companies in Indonesia and internet services companies like Steam, Epic Games, and PayPal will need to go through additional legal hurdles to stay operational in the country.

Now, they have to formally register with the government to do business in the country according to a Niko Partners report. Game companies registered in Indonesia need to adhere to the Private Electronic System Providers regulation set by the government (Penyelenggara Sistem Elektronik Swasta, or PSE). These include PC games, console games, and mobile games. Ditto for international companies that have services in Indonesia.

All these companies will need to register on the PSE website, otherwise, the companies will have their access terminated in the country. Anyone trying to access their online services will be met with this friendly red message:

Already at this point in time, the Indonesian government are starting to block access to Steam, Epic Games, and PayPal (among others) who failed to register into the Electronic Services Operator registry before 29 July 2022 (thanks Toge Productions’ Kris Antoni & Niko Partners Daniel Ahmad).

Is This Good Or Bad?

It might be a double-edged sword. On one hand, these companies need to hand over user information to the Indonesian Government, which could mean companies can get lawsuits thrown at them if they’re found to be disturbing public order within Indonesia. However, there isn’t any content-screening of any kind from the PSE. The move can also see more fair taxation of foreign entities in the country.

Indonesia is arguably the biggest market for gaming, with titles like Mobile Legends and Free Fire being the top games being played in the country. This is because they’re free and are readily available on mobile with little barrier to entry. This PSE move is pulled off so that the local government can regulate these companies properly and keep tabs on them, and also get some tax money on the side.

[Update: 30/7/2022] It’s really bad, as the ban just happened without warning to international developers and game portals who aren’t aware. This is detrimental for game publishers and developers who have already registered with the Indonesian government and have games coming out in the next week or so. Indonesian content creators (esports, media, and so forth) who rely on PayPal for their earnings are also getting screwed.

Kris Antoni from Toge Productions told Kakuchopurei that the company is currently connecting Valve with the Indonesian government, and hopes that the situation can be resolved soon.

[Update: 31/7/2022]: The Indonesian government has confirmed that Valve is in the process of submitting its registration. The government body Komifo has apologized to the many impacted by the block in the country, but stated that the move was forced due to non-compliance. As of right now, PayPal will be unblocked for 5 days to allow people to manage and withdraw their money.

This story is still in development…

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