Traditional Retail under Platform Competition in Pasar Aceh

A Comparative Study of Indonesian Law and Islamic Law

Abstract

This article examines how traditional fashion traders at Pasar Aceh respond to competition from online and platform-based sellers and asks whether the resulting competitive pressure should be understood as a problem of unfair competition, digital-market structure, or ordinary market adaptation. Using a qualitative socio-legal case study, the research combines field interviews with fashion traders and a consumer in Banda Aceh with doctrinal analysis of Indonesian competition law and Islamic commercial law. The empirical evidence indicates that conventional traders have experienced declining sales as consumers increasingly purchase through TikTok, Instagram, Facebook, WhatsApp, and other online channels. Traders nevertheless retain competitive advantages in face-to-face bargaining, direct inspection of goods, fitting facilities, and personal service. The study finds no evidence sufficient to establish a violation of Indonesia’s competition statute by online sellers merely because digital channels offer lower prices or greater convenience. Rather, the central challenge is structural: digital retail reduces search and transaction costs, expands geographic reach, and changes the conditions under which small offline merchants compete. The article also corrects a conceptual ambiguity in the earlier analysis by treating mabīʿ strictly as the object of sale—requiring legality, ownership or authority, deliverability, and sufficient disclosure—rather than as a theory of competitive capacity. This distinction allows competition law to address market conduct and market power, while Islamic commercial law addresses transactional integrity. The article argues for a hybrid adaptation strategy for traditional traders and for competition policy that monitors platform power, data advantages, self-preferencing, exclusionary conduct, and algorithmic practices without treating technological efficiency itself as unlawful competition.