Law and UMKMDuring Pandemics

Micro, Small and Medium Enterprises (MSMEs) is a general term in the world of Economics which refers to productive economic businesses owned by individuals or business entities in accordance with the criteria stipulated by Law no. 20 of 2008.
The increase or decrease in economic growth in Indonesia is influenced by various factors, one of which is the involvement of MSMEs. In accordance with the 1945 Constitution article 33 paragraph 4, MSMEs are part of the national economy with an independent perspective and have great potential to improve people’s welfare. MSMEs have a significant role in the country’s economic growth.
Based on data from the Ministry of Cooperatives and SMEs, the number of MSMEs currently reaches 64.19 million with a contribution to GDP of 61.97% or worth 8,573.89 trillion rupiah. The contribution of MSMEs to the Indonesian economy includes the ability to absorb 97% of the total workforce and can collect up to 60.4% of the total investment.
The high number of MSMEs in Indonesia cannot be separated from the various challenges and conditions of the Covid-19 pandemic that have driven changes in the consumption patterns of goods and services into a momentum to accelerate digital transformation.
The Covid-19 pandemic has affected the national economy, the impact has also been felt in the regions, which has caused the sluggishness of MSME business activities. Various central and regional government policies were issued to maintain the existence of MSMEs during this pandemic. It is necessary to pay attention to which rules really support the sustainability of MSMEs in carrying out their business activities during this COVID-19 pandemic. legal protection for MSME business actors during the Covid-19 pandemic by paying attention to policies issued by the central and regional governments in an effort to prevent and spread the transmission of Covid-19. Policies that existed during the COVID-19 pandemic allowed MSMEs to get back up and develop again. Digital innovation during this pandemic is needed to greatly influence the development and growth of the national and regional economy in particular. MSME actors who utilize and adapt to digital information and communication technology facilities can survive the COVID-19 pandemic, which does not yet know when it will end. By reducing transactions using cash, and switching to non-cash transactions, we can form a digital market system, with support from the government.
The government has tried to focus on stopping the spread of the virus more broadly, as this condition creates a crisis risk that threatens the economy. Various policies such as social assistance, credit restructuring to tax incentives have been pursued by the government to support the business world in surviving the crisis during this pandemic. The money disbursed will run out because the source of the problem is not extinguished and the spread of the Virus will increase and economic problems will increase. The problem of MSMEs during this pandemic needs to be given a legal umbrella, so that with the legal umbrella MSMEs can carry out their business activities in an orderly and orderly manner with the value of legal certainty, as well as justice that is given if one day there is a problem. The legal protection that governs the economy can be found in its elaboration in the hierarchy of laws in force in our country. The main umbrella of the legislation can be seen in the Preamble to the 1945 Constitution, paragraph 4, the 1945 Constitution Articles 33 and 34 paragraph (1), and Law no. 20 of 2008 concerning SMEs. The 1945 Constitution Article 33 and 34 paragraph (1) regulates the Economy and Social Welfare.

Protection Basis for Micro, Small and Medium Enterprises

As a legal state, Indonesia carries out its responsibilities for economic development in accordance with applicable positive law. Responsibility in the field of economic development is not only borne by the Central Government alone, but also becomes the responsibility of the regions according to the authority attached to them based on the principle of decentralization.
The State of Indonesia is a State based on Law (Rechtsstaat). This is stated in Article 1 paragraph (3) of the third amendment of the 1945 Constitution. The concept of a constitutional state of Indonesia is based on the values ​​contained in Pancasila and the preamble to the 1945 Constitution, which in a formal sense, and also in a material sense, namely as a Welfare State. State) or “Prosperity State” (Utrecth, 1960:21-22).
The realization of a just and prosperous society based on Pancasila is the goal to be achieved by the Indonesian people, this can be seen from the application of the concept and pattern of the rule of law in general, which in our country has been adapted to conditions, namely using the benchmarks of the views of the Indonesian nation. The purpose of the formation of the state is not only to maintain order and security, in carrying out its business. The welfare state is the state’s protection for the community, especially the weak, such as the poor, disabled, and unemployed. This concept is in line with the mandate of the 4th Paragraph of the Preamble to the 1945 Constitution, which reads as follows: “…to form an Indonesian state government that protects the entire Indonesian nation and the entire homeland of Indonesia and to promote public welfare, educate the nation’s life, and participate in carry out world order based on freedom, eternal peace and social justice, then…” As a state of law, the activities of the nation and state between the government and its people should not conflict with the applicable law. Law in a broad context, both written and unwritten in accordance with the values ​​that live in society. Based on the objectives of the Republic of Indonesia as stated in the preamble to the 1945 Constitution above, it shows that Indonesia adheres to the concept of a welfare state, in which responsibility for the welfare of its citizens is based on the values ​​of equality and justice.
The form of state responsibility is seen in various interventions in the economic field, especially in realizing equitable distribution of business and protecting small businesses from the situation of the nation’s economic development. State intervention is carried out by issuing various laws and regulations in the economic field, relating to MSMEs. Not only in the preamble to the 1945 Constitution, Article 33 of the 1945 Constitution also contains the welfare state. Article 33 paragraph 1 which reads as follows: “…The economy is structured as a joint effort based on the principle of kinship.” It is implied from the above that the meaning of economic development is to create conditions of economic activity that provide opportunities for equitable distribution of income for all its people. So it is important to pay attention to the protection of MSME actors, namely the arrangement is based on legal principles based on social justice in the preamble of the 1945 Constitution.
Article 33 paragraph 4 of the Fourth Amendment to the 1945 Constitution explicitly includes the principles of sustainable economic democracy in the context of implementing an advanced and united national economy. The function of law in developing Indonesian society is not sufficient in its traditional function, namely to ensure certainty and order, but law as a means of renewal other than as a regulator or a means of development to channel human activities in the direction desired by development and renewal. In carrying out its functions, the law is used as planning and countermeasures, because it is the result of exploring ideas that regulate people’s lives in order to provide certainty, security, protection, and balance that is believed to guard social change as well as a means of development.
Law is the principles and rules that govern human life, which embodies the application of those principles and rules into reality. The presence of law in society that connects and regulates the interests of organizations in society, plays a role in minimizing turmoil in the process of realizing it. Many MSMEs who do not open their businesses anymore during the Covid-19 pandemic really need attention. The central government is considered to need to take a comprehensive approach as an effort to overcome the impact of Covid-19, especially on MSME business actors. A series of efforts have been prepared and carried out by the central government, including in terms of increasing purchasing power, social assistance, financing assistance, reducing taxes. The efforts that have been prepared and carried out by the government are carried out by the government as an effort to save MSMEs due to the Covid-19 pandemic, which the government does not know until when this pandemic will end.
The government plays a very important role in determining the direction and policies for income distribution for MSMEs, especially during this COVID-19 pandemic. Public policies issued as a form of government attention through various legal products, such as laws, government regulations to regional regulations. Central government include:

1. The central government issued a pre-employment program policy as a facility for MSME business actors to hone their abilities to develop their businesses. MSME business actors are given views on the use of digital technology in general and digital technology in particular in order to survive during the Covid-19 pandemic and after the Covid-19 pandemic.
2. The central government issued a policy on the use of digital technology as a marketing tool in the MSME business. The use of digital technology is carried out with the aim of supporting the progress and development of economic activity.
3. The central government in providing education on the use of digital technology as a marketing tool in the MSME business can conduct a coaching model by providing academic institutions in the field of entrepreneurship and business management so that MSME business actors can have a view of the business world.
4. The central government cooperates with BUMN and BUMS companies so that these companies can provide guidance and foster MSMEs as business development partners.

The role of MSMEs is so important, not only requires careful planning, but also requires a strong commitment to be able to develop the potential energy of MSMEs. Considering that the efforts to develop and empower MSMEs are not only for short-term policies, they are also applied as long-term policies that are sustainable. So a strong commitment is also very much needed in the development and empowerment of MSMEs. In Article 17 of the Presidential Regulation of the Republic of Indonesia Number 96 of 2020 concerning the Ministry of Cooperatives and MSMEs, the government is tasked with implementing policies in the MSME sector. The form of policy implementation as well as coordinating and synchronizing the implementation of policies in the MSME sector has been regulated in Article 18 which states that the Central Government will provide technical guidance and supervision in the field of MSME development and empowerment.
The implementation of the Central Government providing this guidance is carried out by all elements within the Ministry of Cooperatives and MSMEs by carrying out their duties by coordinating, integrating, and synchronizing the relationship between central government agencies and local governments. The commitment to protect and empower Micro, small and medium enterprises is not only a matter for the Central Government, but it is also a matter for local governments based on the principle of decentralization. In Law no. 23 of 2014 which was amended by Law no. 9 of 2015 concerning Regional Government, it is stated that the development of cooperatives, micro-enterprises, is the business of the Provincial Government and City/Regency Governments.
The law functions more than just that, namely as a means of community renewal, so that order or order in development efforts is considered necessary. As a form of the government’s commitment to implementing policies as guidelines for renewal for the continuity of business activities for MSMEs in the midst of the COVID-19 pandemic, namely the use of integrated technology. The Central Government has regulated in Article 71 letter (f) of Government Regulation of the Republic of Indonesia Number 7 of 2021 concerning the Ease, Protection, and Empowerment of Cooperatives and MSMEs which states that the marketing of MSME products can be through electronic or non-electronic commerce. Marketing of MSME products can be done by providing a place for the promotion and development of MSMEs, facilitating MSME business actors by holding domestic and foreign exhibitions, developing logistics capacity, conducting digital literacy and developing online businesses as a means to help MSME business actors to market their products by selling them online in digital markets. Through digital marketing, MSME business actors can get various benefits including business actors can market their wares wherever and wherever the consumer is domiciled, consumers can communicate with business actors, consumers can view photos or videos that explain product illustrations, business actors can upload testimonials about their products from previous consumers to get new consumers, can be accessed at any time. Developing and empowering MSMEs by using this digital marketing method, MSME actors can also showcase the goods being sold by displaying creative and innovative content.