TikTok and Indonesian tech giant GoTo announced establishing a strategic partnership on Monday.

According to the agreement, TikTok Shop's Indonesian business will merge with GoTo's e-commerce subsidiary Tokopedia, forming PT Tokopedia. TikTok commits to a long-term investment in PT Tokopedia with a value exceeding US$1.5 billion and will hold a controlling stake.

In September, the Indonesian Ministry of Trade banned e-commerce transactions on social media platforms. However, the country's Deputy Minister of Trade, Jerry Sambuaga, recently said that as long as TikTok complies with applicable Indonesian regulations and procedures, it is free to collaborate with any e-commerce platform.