Olivia Cavallaro Tech 07.31.2022 22:Jul PM EDT

Steam, PayPal Have Been Blocked in Indonesia — But Why?

Eight electronic service providers were suspended by the Indonesian government on Saturday.

The Government of Indonesia has effectively blocked access to several electronic service providers (ESPs) because they missed the deadline for registering under a controversial licensing regime. Eight companies including Steam, Epic Games, PayPal, and Yahoo were banned after they failed to comply with a new government requirement regarding Indonesia's restrictive content moderation laws.

Indonesia's 2020 MR5 law orders companies that are identified as "Private Electronic System Providers" to register with a government database or be banned, Engadget reported. The deadline for registering was last week.

Like India's restrictive 2021 IT law, Indonesia's 2020 MR5 law empowers the government to regulate online platforms and order them to take down content that they feel is unlawful or a threat to public order. "Urgent" requests give these platforms only four hours to respond and take down such content.

Are Global ESPs Complying with Indonesia's Strict Laws?

Big Tech giants Google, Amazon, and Meta rushed to register with Indonesia's government to comply with its new requirements, Reuters reported. But eight ESPs failed to meet the deadline, including Yahoo, Steam, Paypal, DoTA2, Counter-Strike, EpicGames, Origin.com, and Xandr.com.

Indonesia's Ministry of Communication and Information general director Semuel Abrijani Pangerapan told a local news network that the government may temporarily reopen access to PayPal to enable users to withdraw their money. The country has an estimated 191 million internet and a young, tech-savvy population that heavily relies on ESPs.

Indonesian Government's MR5 Faces Backlash from Internet Users, Human Rights Activists

Ministerial Regulation 5 (MR5), which caused the ban of PayPal, Steam, and a handful of other ESPs after they missed Friday's deadline for registration, was first enacted in November 2020 with little consultation. Critics believe that MR5 is heavy-handed and overbroad as it does not meet international human rights laws, The Diplomat reported.

It is also a blow to the right to privacy. Under the law, digital operators must provide Indonesia's Ministry of Communication and Information Technology (KOMINFO) a guarantee that law enforcers can access their electronic systems and data, which is a clear violation of privacy laws.

Indonesia's content moderation regulations also raise censorship concerns, as the government orders anything "that disturbs the community or public order" to be taken down. This description is very vague and broad and can be defined as anything the Indonesian authorities choose.

In 2021, Human Rights Watch called upon Indonesia's minister of communication and information technology to "suspend and substantially revise" the regulation because they believed it did not "meet international human rights standards."

Linda Lakhdhir, Asia legal advisor at Human Rights Watch, described MR5 as "a tool for censorship that imposes unrealistic burdens on the many digital services and platforms that are used in Indonesia." She added that it poses a serious risk to privacy, freedom of speech and freedom to access information.

Similarly, a 2021 report from the Electronic Frontier Foundation (EFF), a digital rights group, described Indonesia's laws as "invasive of human rights," The Verge reported. The organization also wrote a letter to the Ministry of Communication and Information, urging the Indonesian government to repeal the "invasive content moderation rules."