Facebook finally opens permanent office in Jakarta, the world’s most active city on Instagram

Inside Facebook's new Jakarta office. Photo credit: Tech in Asia.

More than three years after opening a representative office in Indonesia's capital, Facebook yesterday inaugurated its first permanent presence in the country.

Indonesia is an important growth market for the social network and its subsidiaries and the move reflects that. It's also a reaction to tightening regulations for foreign internet companies.

Jakarta is the city where most Instagram stories are posted from.

Indonesia – which constitutes Facebook's fourth largest user base in the world –  is in the process of laying out rules for how global internet firms are allowed to operate in the country.

One of the proposed requirements is that foreign companies like Google, Facebook, and Twitter must have permanent business licenses in Indonesia. Another demand is that certain user data must be stored on local servers. A permanent business license and permanent office, as opposed to a representative office, mean greater tax payment obligations.

The transition from a largely unregulated environment to more government scrutiny hasn't been easy for either side. Google was in a spat with Indonesian regulators over tax payments for months, eventually coming to a settlement.

At the inauguration event, Facebook Indonesia country director Sri Widowati confirmed that the US firm obtained a permanent business license to operate in Indonesia in March this year.

Inside Facebook's new Jakarta office. Photo credit: Tech in Asia.

But according to reports, there's still doubt (link in Indonesian) whether the license it got, which is for a  management consulting business, is appropriate for the type of business Facebook runs in Indonesia. The social network's main source of revenue is advertising.

Widowati was unwilling to dive deeper into the subject at the event.

"Our investment in Indonesia is a priority. This is a big market for us. Our users are very active here. We welcome every good opportunity to invest. But we cannot say specifically which type of business we are running in Indonesia," she said.

She also declined to share the number of employees Facebook has in Indonesia. "Compared with other Facebook offices globally, the number is still very small."

The regulations concerning companies like Facebook are still in draft stage and remain subject to change, which may explain why the firm is unwilling to discuss this matter in more depth.

With the opening of the new office, Indonesia for the first time also hosts representatives of Facebook's other services, like WhatsApp and Instagram, in the country. Instagram, in particular, has become popular here; Jakarta is the city where most Instagram stories are posted from, beating even London and New York.

This article first appeared in Indonesian, written by Danang Setiaji. Information was translated and edited for this version.

Source: Facebook finally opens permanent office in Jakarta, the world's most active city on Instagram