As you know, in Indonesia there are many types of businesses that can be run with various promising profit opportunities. Even so, it should be noted again whether the business does not violate government regulations and applicable laws. Yes, because there are several types of illegal businesses that should be avoided by MSME players and novice business people. Apart from harming many parties, this illegal business also violates the laws and regulations that apply in Indonesia. In this article, we will explore several types of illegal businesses that need to be avoided by MSMEs and novice business people. This is important to know, because mistakes in choosing a business path can lead to serious legal consequences.
What is an Illegal Business?
Illegal business refers to economic activities carried out by a group or individual, but in its implementation, there are forms of legal violations and do not meet the requirements set by the government according to applicable regulations. So that every actor who runs an illegal business will be subject to sanctions in the form of both fines and criminal law as regulated by the laws governing these provisions. A business can be said to be illegal because it involves unauthorized practices such as drug trafficking, prohibited goods, copyright piracy, and fraud. For more details, KH Pals need to understand what types of illegal businesses should be avoided, especially by MSME players and novice business people.
Examples of Illegal Businesses to Avoid
At least, there are several types that are prohibited for everyone including MSME players and novice business people. This has also been determined through laws and regulations issued by the government. What are some examples?
1. Gambling Business
KH friends may have seen in the neighborhood there are people who run togel, betting, or online gambling businesses that often appear on web pages. Well, this is an illegal business that has been banned by the government for a long time. This is because gambling is categorized as a serious crime that is contrary to religious norms, morals, and endangers the safety of the country. The prohibition of the gambling business has also been regulated in Law Number 7 of 1974 concerning Gambling Control. Meanwhile, the penalty for gambling refers to Article 303 of the Criminal Code, which is imprisonment for up to 10 years or a fine of up to IDR 25 million.
2. Illegal Online Loan Business
Today, there are many online fintech companies that offer the convenience of unsecured loans. However, not all of these online lending companies are legal or officially registered with the Financial Services Authority (OJK). OJK noted that there were 3,903 public complaints related to illegal online loans aka pinjol from January 1 to May 29, 2023. Not a few victims received threats and intimidating behavior from illegal pinjol debt collectors. Seeing that the case is very disturbing to the community, of course the illegal pinjol business is a serious offense and will be charged with a crime. Where based on Law No. 4 of 2023, illegal pinjol actors are threatened with a maximum imprisonment of 10 years or a maximum fine of Rp1 trillion.
3. Illegal Drug Business
The next illegal business is dealing in various types of narcotics and illegal drugs. Unfortunately, today there are still many cases of narcotics trafficking found such as selling marijuana, methamphetamine, heroin, morphine, and the like. The drug trade is indeed the most controversial business in the world. This is because it is very detrimental to many parties, but it is still difficult to overcome. The prohibition on the distribution of illegal narcotics has also been regulated in Law No. 35 of 2009, where each dealer will be subject to a maximum fine of IDR 10 billion and a minimum prison sentence of four years or a maximum death sentence.
4. Rare Animal Buying and Selling Business
Indeed, rare animals must be protected to prevent them from extinction. Therefore, the Indonesian government issued Law Number 5 of 1990 concerning the Conservation of Living Natural Resources and Their Ecosystems. In the regulation, it is stated that everyone is prohibited from trading rare animals both alive and dead. Anyone who violates this regulation will be fined up to 5 years imprisonment.
5. Alcohol Beverage Business
Although the government restricts the circulation of alcoholic beverages below 5 percent, there are still many people who distribute alcohol freely. In fact, when referring to the Criminal Code (KUHP), it regulates criminal threats for someone who sells intoxicating drinks. It states that those who sell alcoholic beverages will be fined up to IDR 10 million or imprisoned for a maximum of 1 year. So it can be concluded that people who run this business, including serious violations of criminal law. Therefore, it is best to avoid selling alcoholic beverage products that can harm many parties.
6. Pirated Book Business
The pirated book business is also part of an illegal business that has severe legal consequences. Most cases of book piracy include copyright infringement that harms the original owner. It should be noted that pirated books are the production of a book writing work that aims to gain personal profit without giving royalties to the author or copyright owner. Until now, book piracy is still often found by irresponsible people. The rise of selling and buying pirated books is certainly an act of violation of the rules of Article 113 paragraph (4) of Law Number 28 of 2014 concerning Copyright. Violation of book piracy, the perpetrator may be subject to a maximum fine of Rp4 billion or a maximum imprisonment of 10 years.
7. Pirated Movie Business
While technology has made it easier to access multimedia content, such as movies and TV series, through legal streaming platforms, the practice of movie piracy is still a significant problem. Pirating movies and distributing them violates the copyrights of filmmakers, producers, directors, and actors. These people have spent enormous time and resources to create the work, and through piracy, they are deprived of the profits they should have received. All forms of this violation have been regulated through Law Number 33 Year 2009 on Film. Article 80 states that perpetrators who commit movie piracy can be sentenced to imprisonment for 2 years or a maximum fine of Rp10 billion. Those are some examples of illegal business types that KH pals should avoid. In essence, in developing a business, it is important for MSME players and novice business people to choose the right and legal path. This is because illegal businesses not only violate applicable laws and regulations, but also harm many parties.
KH Contact
Well, as a responsible businessman, let’s start and run a business that is completely legal and in accordance with the norms! There are many business ideas that can be explored without having to break the law and harm other parties. For KH Pals who need help or consultation regarding the steps and processes to start a business, you can contact Kontrak Hukum. Together with trusted professional experts, you can run your business smoothly, safely, and in accordance with applicable regulations. To view services according to business needs, please visit the KH Services – Starting a Business page. If you still have questions, just consult for free at Ask KH or via direct message (DM) to Instagram @kontrakhukum.
