The Role of SMEs in The Economic Development of Indonesia: A Study of Competition Law and Policy in The Field of Retail Industry

Abstract

Indonesian Anti-Monopoly Law provides for the exemption of business actors which belong to the category of small scale businesses. This is the materialization of the law's objective, namely ensuring equal opportunities to do business for large-, medium-, and small-scale entrepreneurs. Small-scale business actors who play a role in Indonesia's trading system include, among others, business actors engaging in the retail industry. The retail industry started to emerge with the proliferation of modern retail businesses in urban areas based on the franchise concept. In fact, there have been certain large retail businesses that have been proven to violate the Anti-Monopoly Law, particularly the prohibition of abusing a dominant position. With their presence, modern retail businesses have gradually replaced traditional retail businesses, which generally include small-scale enterprises (SMEs). The above-mentioned government policy on protecting small industries has been based on juridical, political as well as economic considerations. From the juridical point of view, there is a law concerning the treatment of medium, small, and micro businesses (MSMEs).