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Indonesia Bans Apple’s iPhone 16 Series as Apple Defaults on Investment Promises
Indonesia's strict Local Content Policy mandates that companies source up to 40% of their contribution locally to obtain the Domestic Component Level (TKDN) Certification required for sales.

By Kumar Harshit

on October 29, 2024

The government of Indonesia has banned the sale and use of Apple's iPhone 16 series and Apple Watch Series 10 as the former failed to meet its investment promises in Indonesia. 

Investment Promises 
The government of Indonesia cited the unmet promises to be the major reason behind the ban. Earlier Apple had promised to invest approximately IDR1.71 trillion to which it invested only 1.48 trillion, rendering a gap of around $14.75 Million. 

WIthelding of Licenses  
As a result of failing the promises, the International Mobile Equipment Identity (IMEI) certification of Apple‘s iPhone 16 series and Watch 10 series has been withheld disabling it to sell its newly launched iPhones in the Indonesian market. This brings the iPhone 16 Series and Watch 10 series under serious legal objections in confrontation with the laws of Indonesia. 

Indonesia also has got strict Local Content Policy for companies to go up to 40%, thus enabling foreign companies to receive the Domestic Component Level (TKDN) Certification necessary for sales in Indonesia. It includes tinga from R&D to software development and local manufacturing.  

Use of iPhones 
The government, through the minister, has urged the public to report any incident of the use of an iPhone 16 or watch claiming it to be an illegal practice. The minister has thus issued a strong warning against the giant smartphone company. The minister appealed to the people to follow the law of the land. 

Only tourists and airline crew will be allowed to carry and use these banned products while in Indonesia, 2 articles per person.  However, any kind of sale would strictly be illegal. 

Prospects for Apple 
Although Apple doesn’t rank among the Top 6 smartphone brands selling in Indonesia,  the figure of Mobile Phones going up to 350 Million for a population of 270 Million speaks volumes about the demand and attraction smartphones hold in the market of Indonesia. It may not be the most important market but considering the demand, Apple’s involvement would have made the entire smartphone market of Indonesia somewhat interesting. 

As of now, Apple doesn’t have any manufacturing facility in Indonesia, although it has app developer academies there that take the entire investment to about 1.6 Trillion Rupiah. This ban casts a shadow over the $1.48 trillion invested by Apple in Indonesia. 

Prospects for Users 
For the people of Indonesia, it is obviously a piece of bad news as Apple’s premium phones are the most demanding & appealing phones among all the smartphones made by companies such as Samsung and Xiaomi. Smartphones by Apple not only provide a best-in-class experience in terms of their software and seamlessness, but their sleek and modern design gives them an interesting edge over all others.  

As the situation unfolds, it will be crucial to watch how Apple responds to this significant regulatory challenge and what it means for the smartphone landscape in Indonesia. Let’s see what comes up as the versions and updates on the info, for then it would be interesting to witness the tussle.  

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