Article Sidebar

Download
PDF
Statistic
Read Counter : 12 Download : 3

Main Article Content

Abstract

This study critically examines the regulatory challenges facing Indonesian business law amid rapid technological disruption, using normative legal research with a doctrinal approach. Analyzing legislation, legal principles, and academic literature, it identifies a persistent tension between legal certainty and the imperative to innovate. Indonesia’s regulatory framework often trails digital transformation and global integration, producing delays that generate uncertainty for firms, weaken consumer protection, and heighten risks of unfair practices. The literature remains thin on the dynamic mismatch between evolving business models and regulatory responses, underscoring the need for studies that integrate empirical evidence with theory to inform adaptive rule-making. Cross-border transactions compound complexity, as jurisdictional overlaps constrain national authorities in cases involving transnational actors; these pressures are systemic, bearing directly on the effectiveness, legitimacy, and competitiveness of Indonesian business law. Rather than reacting after the fact, business law should act as a driver of responsible innovation—promoting growth while respecting Indonesian legal and cultural values and protecting the public interest. This requires a normative framework attentive to local socio-cultural specificities, distinct from dominant Western accounts of responsible innovation. Indonesia’s capacity to navigate disruption thus depends not only on legislative reform but also on a responsive, collaborative, and inclusive legal ecosystem that is anticipatory, integrative, and resilient. The study contributes theoretically by clarifying how to design institutions that deliver legal certainty while enabling sustainable innovation, and practically by offering a foundation for policymakers to build a fair, competitive, future-ready regime.

Keywords

Business Law Technological Disruption Regulatory Innovation Indonesia Legal Reform

Article Details

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

How to Cite
Purborini, V. S., & Suryaningsih. (2025). Regulatory Dilemma and Innovation: A Critical Analysis of Business Law in Indonesia Facing Technological Disruption. Ilomata International Journal of Social Science, 6(4), 1337-1357. https://doi.org/10.61194/ijss.v6i4.1845

References

  1. Arner, D. W., Buckley, R. P., Zetzsche, D. A., & Veidt, L. (2020). No Title. Artificial Intelligence and FinTech: Towards a Regulatory Synthesis, 25(1), 221–279.
  2. Arrizal, N. Z., Kharisma, B. U., & Nur, A. I. (2021). No Title. Juridical Review of Job Creation Law in Indonesia Perspective of Corporation Law Body, 1(2).
  3. Baiquni, M. I., & Waspiah, W. (2023). Two decades of business competition law: How has Indonesian competition law transformed. 7(1).
  4. Baldwin, R., Cave, M., & Lodge, M. (2012). Understanding Regulation: Theory, Strategy and Practice. Oxford University Press.
  5. Bamberger, K. A., & Lobel, O. (2017). Platform market power. 7(1), 1–25.
  6. Bank, W. (2020). Doing Business 2020: Comparing Business Regulation in 190 Economies. World Bank Publications.
  7. Black, J. (2008). Forms and Functions of Regulation. 2008–2013.
  8. Brownsword, R. (2017). Regulating Code: Good, Bad, Ugly, and Illegal. 1(1), 1–28.
  9. Buckley, R. P., Arner, D. W., & Zetzsche, D. A. (2016). The FinTech Revolution: A Regulators’ Roundtable. 1(1), 1–22.
  10. Butt, S. (2020). Indonesian business law and legal reform. 15(1), 1–25.
  11. Clack, C. D., Bakshi, V. A., & Braine, L. (2016). Smart contract templates: Foundations, design landscape and research directions.
  12. De Filippi, P., & Hassan, S. (2018). Blockchain technology as a regulatory technology: From code is law to law is code. 21(12).
  13. Fenwick, M., Kaal, W. A., & Vermeulen, E. P. (2019). Regulation tomorrow: What happens when technology is faster than the law? 8(3), 561–594.
  14. Floridi, L., Cowls, J., Beltrametti, M., Chatila, R., Chazerand, P., Dignum, V., ... & Vayena, E. (2018). AI4People—Ethical Framework for a Good AI Society: Opportunities, Risks, Principles, and Recommendation. 28(4), 689–707.
  15. Gunawan, J. (2020). Validity of electronic contracts in civil law perspective. 5(2), 102–117.
  16. Gürkaynak, G., Yilmaz, O., & Yenidogan, E. (2018). Regulatory Dilemmas in Digital Markets: Balancing Innovation and Competition. 14(2), 241–267.
  17. Haliwela, N. S., & Chansrakaeo, R. (2024). The Corporate Social Responsibility Regulation in the Development of Business Law: Comparison of Indonesia and Thailand. 8(1).
  18. Hawin, M., Butt, S., & Setianingrum, R. B. (2023). Evaluating Whether Indonesia Should Maintain or Revise Its Local Incorporation Requirement for Foreign Investors. 31(2).
  19. Indonesia, B. (2020). Peraturan Bank Indonesia Nomor 22/23/PBI/2020 tentang Sistem Pembayaran.
  20. Iramani, R. R., Mongid, A., & Muazaroh, M. (2021). Reform of the Limited Liability Company Law for the Enforcement of Good Corporate Governance.
  21. Khan, L. M. (2017). Amazon’s Antitrust Paradox. 126(3), 710–802.
  22. Koops, B. J., Leenes, R., & van der Sloot, B. (2017). Data Protection and Privacy: The Age of Intelligent Machines. Edward Elgar Publishing.
  23. Kusuma, D., & Rachmawati, T. (2020). Regulatory sandbox as an adaptation instrument for fintech. 9(1), 75–89.
  24. Martiniasih, N., & Saravistha, D. B. (2021). Harmonization of BI and OJK regulatory sandbox authority. 3(8), 1–12.
  25. Marzuki, P. M. (2021). Penelitian Hukum (Edisi Revisi). Kencana.
  26. Nazir, M. (2014). Metode Penelitian. Ghalia Indonesia.
  27. Nonet, P., & Selznick, P. (2001). Law and Society in Transition: Toward Responsive Law. Transaction Publishers.
  28. OECD. (2021). The Digital Transformation of SMEs. OECD Publishing.
  29. Oktaviandra, S. (2024). Closing Legal Loopholes on Indonesia Investment Law in Digital Age. 15(1).
  30. Partners, C. &. (2024). Fintech laws & regulations 2024. Chambers Global.
  31. Peraturan Otoritas Jasa Keuangan Nomor 13/POJK.02/2018 Tentang Inovasi Keuangan Digital Di Sektor Jasa Keuanga (2020).
  32. Priestley, J. M., & Susanti, R. (2023). The Urgency of Legal Reform in Enhancing Digital Forensics Capacity for Cybercrime Eradication in Indonesia. 53(1), 127–147.
  33. Rachmania, S. N., Sukarmi, & Hadiyantina, S. (2025). Legal analysis of the ratio legis behind risk based business licensing reform in Indonesia: A study of PP No. 24/2018 and PP No. 5/2021. 96(1), 140–149.
  34. Ramadhani, N., Nandani, D. R., Arrizki, F., & N. (2023). Peran Digitalisasi Teknologi Informasi Dalam Proses Pengembembangan E-Commerce di Era 4.0 dan Society 5.0. Jurnal Ekonomi Syariah, 225–232.
  35. Rohaya, N., Sinulingga, D. B., & Mutiara, U. (2023). Challenges of Indonesian Contract Law in the Digital Business Era.
  36. Schwab, K. (2017). The Fourth Industrial Revolution.
  37. Setiadi, E. (2021). Challenges in Regulating Fintech in Indonesia: A Legal Perspective. 3(1), 45–59.
  38. Setiadi, E., & Sari, V. R. (2022). Legal Protection of Personal Data in Digital Transactions in Indonesia. 25(S2), 1–10.
  39. Sugeng, S., Tobing, C. I., & Fajarwati, R. (2020). Indonesian Fintech: Business Ecosystem and Regulation. 5(2), 277–295.
  40. Sunstein, C. R. (2013). Simpler: The Future of Government.
  41. Susilo, B., & Hidayat, M. (2021). The Legal Challenges of Cross-Border E-Commerce Disputes in Indonesia. 13(1), 1–12.
  42. Syahrina, M. A. (2020). Validity concept of electronic contracts under national law & UNCITRAL. 9(2), 105–120.
  43. Tapscott, D., & Tapscott, A. (2016). Blockchain Revolution: How the Technology Behind Bitcoin Is Changing Money, Business, and the World. In Portfolio.
  44. Tisnadibrata, Y. (2021). Law enforcement in digital ecosystems. 51(4), 311–330.
  45. UNCITRAL. (2017). Model Law on Electronic Transferable Records.
  46. Utomo, B., & Rahayu, R. M. (2023). The Urgency of Regulatory Framework to Protect Consumers in Digital Financial Services. 23(1), 1–12.
  47. Vollmer, J. (2022). Governing the Digital Economy: Regulatory Responses to the Rise of Big Tech. Edward Elgar Publishing.
  48. Wirtz, B. W., & Müller, W. M. (2019). An integrated AI framework for public management. 21(7), 1076–1100.
  49. Yudhistira, M. H., & Wicaksono, A. T. (2022). Legal Readiness for Digital Innovation: The Case of Indonesia’s Tech Ecosystem. 39(2), 201–221.
  50. Zetzsche, D. A., Buckley, R. P., Arner, D. W., & Barberis, J. N. (2017). Regulating a Revolution: From Regulatory Sandboxes to Smart Regulation. 23(1), 31–103.