The Concept of Dominant Position in the Practice of Digital Business: A Legal Analysis on the Improvement of Indonesia’s Business Competition Law

Abstract

The growth of the digital economy has introduced new forms of market dominance that cannot be addressed by Indonesia’s conventional competition law frameworks. Law No. 5 of 1999 on the Prohibition of Monopolistic Practices and Unfair Business Competition employs quantitative market share thresholds 50% or 75% as the primary indicator of dominant position. In the digital era, market dominance is no longer determined by traditional market share, but rather by control over user data, algorithmic systems, and technological infrastructure. Based on this issue, the article aims to analyze the extent to which the dominant position concept in Law No. 5 of 1999 can reach these new forms of digital dominance. This article employs normative legal methods with conceptual, statutory, and comparative approaches. In addition, the article also uses Satjipto Raharjo’s Progressive Law Theory as a tool for an in-depth legal analysis. Finally, our study concludes that there are three fundamental limitations to the current legal framework regarding business competition: (1) a dominant position definition relying solely on quantitative market share; (2) the absence of data market, algorithmic dominance, and gatekeeper concepts within its normative framework; and (3) an ex-post approach incapable of responding to the rapid dynamics of digital markets. Drawing on Rahardjo's theoretical framework, it is recommended to expand the meaning of dominant position so that law can function preventively and curatively within the digital economic ecosystem.