The Urgency of Reforming Indonesian Commercial Law in the Era of Digital Trade: Normative Gaps, Regulatory Fragmentation, and Directions for Codification

Abstract

The rapid growth of digital trade has transformed how goods and services are exchanged in Indonesia, yet the country's core commercial legislation, the Commercial Code (Kitab Undang-Undang Hukum Dagang, KUHD), remains a colonial-era instrument designed for physical, bilateral transactions. Digital trade is instead governed by a patchwork of sectoral laws, including the Electronic Information and Transactions Law, the Consumer Protection Law, the Personal Data Protection Law, and the Government Regulation on Trade through Electronic Systems. This study examines how Indonesian commercial law has responded to business digitalization, identifies the normative gaps and regulatory fragmentation that generate legal uncertainty, and formulates directions for reform. Using normative legal research with statutory, conceptual, and comparative approaches, the study analyzes Indonesian legislation alongside international instruments such as the UNCITRAL model laws and the European Union's digital regulations, as well as the scholarly literature on electronic contracting, platform governance, data protection, and online dispute resolution. The findings show that the KUHD contains no provisions on electronic contracts, digital intermediaries, or electronic evidence, so that these matters are regulated only partially in separate instruments that are not integrated into a coherent commercial law system. Four problem areas are particularly significant: the validity and fairness of click-wrap and standard-form electronic contracts; the unclear liability of marketplace platforms; the protection of personal data and the prevention of cyber fraud; and the absence of accessible online dispute resolution. The study argues that incremental amendments are insufficient and proposes a reform agenda based on functional equivalence, technological neutrality, proportionate platform responsibility, data protection by design, and accessible digital justice. Such reform would strengthen legal certainty for business actors, especially micro, small, and medium enterprises, enhance consumer protection, and support the competitiveness of Indonesia's digital economy.