An analysis of trademark law in Indonesia

In Indonesia, the primary law on trademarks is Law No.20 of 2016 on Marks and Geographical Indications, known as the Trademark Law. The Trademark Law was updated through Law No.6, 2023 on the Enactment of Replacement Government Regulation in Lieu of Law No.2, 2022 on Job Creation as Law. Furthermore, several bylaws regulate more specific matters, including:

1. 1. Government Regulation No.28, 2019, concerning types and tariffs of non-tax state revenues applicable to the Ministry of Law and Human Rights, which sets the official fees for various actions that can be filed before the director general of intellectual property (DGIP) under the Ministry of Law and Human Rights;
   2. Government Regulation No.22, 2018, on the international registration of marks under the protocols relevant to the Madrid Agreement concerning the international registration of marks, which covers all aspects of international registration filed in or from Indonesia;
   3. Government Regulation No.90, 2019, concerning the Trademark Appeal Commission, established in 1995, concerning procedures for application, examination and settlement of appeals at the commission;
   4. The Ministry of Law and Human Rights Regulation No.12, 2021, on the amendment to Regulation No.67, 2016, concerning the Trademark Registration Decree of the director general of intellectual property in the field of trademarks. The ministerial regulation covers registration, classes of goods and services, and the rectification of issued certificates and records; and
   5. The Ministry of Law and Human Rights Regulation No.10, 2022, on the amendment to Regulation No.12, 2019, on geographical indications.

Scope of trademarks

The Trademark Law defines a mark as any sign capable of being represented graphically in the form of drawings, logos, names, words, letters, numerals, colour arrangements, two and/or three-dimensional shapes, sounds, holograms or a combination of two or more of these elements used to distinguish goods and/or services produced by a person or legal entity in trade.

It acknowledges two types of trademarks: traditional and non-traditional marks. Some marks cannot be registered due to their lack of inherent distinctiveness. These conditions are met if the marks:

1. 1. Are contrary to the state ideology, laws and regulations, religious morality, ethics or public order;
   2. Are identical to, related to or simply describe the goods and/or services for which registration is sought;
   3. Contain elements that could mislead the public about the origin, quality, type, size, variety or purpose of the goods and/or services for which registration is sought, or are the names of protected plant varieties for similar goods and/or services;
   4. Contain information that is not consistent with the quality, benefits or efficacy of the goods and/or services produced;
   5. Lack distinctive character;
   6. Are common names and/or symbols belonging to the public; or
   7. Contain functional forms.

Applying

The Trademark Law adopts a first-to-file principle. In general, any individual, organisation or company can file for trademark registration. However, the law also regulates trademark registrations that are filed in bad faith. Article 21 of the Trademark Law stipulates that an application is refused if it is submitted by an applicant in bad faith.

In practice, it is quite challenging to determine whether an application is filed in bad faith or not.

A bad-faith application that later matures into registration can always be invalidated at the Court of Commerce, as regulated under article 77 of the Trademark Law. This article stipulates that: “The lawsuit for invalidation may be filed at unlimited time if there is bad faith and/or the relevant mark contravenes the state ideology, laws and regulations, morality, religions, decency and public order”.

Filing

A trademark search is strongly suggested for anyone who wishes to file a trademark application in Indonesia. The search report will identify potential hazards and stumbling blocks to an otherwise successful registration process.

Assuming the search report gives an all-clear sign to proceed with the application process, the applicant will then need to supply the following:

1. 1. Name of applicant;
   2. Address;
   3. List of goods and services; and
   4. Representation of the mark to be filed, which can be in the form of a word mark, logo or non-traditional marks.

Once the information has been provided, the patent lawyer will prepare two documents to be signed by the client: a power of attorney and a statement of mark ownership.

Since 2019, e-filing has been the only acceptable method of filing in Indonesia.

Timeline

Assuming the application does not receive any opposition and provisional refusal, then it may take 10 to 13 months from filing to obtaining a registration number. This estimate is significantly faster than it used to be, when even a straightforward registration would take two to three years.

Opposing

Applications are published for two months only. During the publication period, any interested party may file for opposition. Their opposition will be considered during the substantive examination stage.

Once the publication period has lapsed, there are no other formal means of filing for opposition, including extension requests.

To successfully oppose an application, it is strongly recommended that the opposer has a valid legal standing – namely, an earlier trademark application or registration in Indonesia. Otherwise, the examiner will likely reject the opposition by citing the first-to-file principle.

Invalidations and cancellations initiated by any third party, which must be filed at the Court of Commerce, are only feasible once the target trademark has been registered.

Foreign fame

A trademark can only be protected if it is registered in Indonesia, regardless of its fame. However, the Trademark Law provides a mechanism to somewhat protect famous foreign trademarks from bad-faith registrations by other parties.

Should another party try to maliciously apply for a trademark that is identical or similar to a famous foreign trademark, the application will be rejected based on article 21 of the Trademark Law, which stipulates: “An application is refused if the mark is substantively similar to or identical with a well-known mark of other parties for similar goods and/or services, or a well-known mark of other parties for different goods and/or services complying with certain requirements”.

The issue is then shifted to what constitutes a famous trademark. Article 18 of the Ministry of Law and Human Rights Regulation No.12, 2021, on the amendment to Regulation No.67, 2016, concerning the Trademark Registration Decree of the DGIP in the field of trademarks, sets out what makes a trademark famous:

1. 1. Level of knowledge or public recognition of the mark in the business field concerned as a well-known mark;
   2. Volume of sales of goods and/or services and benefits derived from using the mark by the owner;
   3. Market share controlled by the mark in relation to the circulation of goods and/or services in the community;
   4. Area of use of the mark;
   5. Period of use of the mark;
   6. Intensity of promotion of the mark, including the value of investment used for the promotion;
   7. Number of trademark applications and registrations around the world;
   8. Success rate of law enforcement, particularly regarding the recognition of the mark as a well-known mark by an authorised institution; and
   9. Valuation of the mark due to its reputation and quality assurance of goods and/or services protected by the mark.

However, a mark that is famous abroad does not necessarily have the same level of fame in Indonesia. This raises an issue of whether the trademark owner should also establish its fame in Indonesia before taking any actions against other parties.

Usage requirements

Since Indonesia adopts the first-to-file principle, prior use does not need to be claimed before registration. Evidence of use does not have to be submitted.

If the applicant has filed an earlier application in other countries, the applicant has six months from the priority date to claim priority in Indonesia.

Concerning non-use, by law, a trademark may be cancelled at the Court of Commerce if a registered mark has not been used for five consecutive years from the date of registration or the date of last use. However, the law does not stipulate the minimum threshold of use – hence, in general, any non-use cancellation is very challenging.

Licensing

A registered mark can be licensed to other parties in Indonesia. For an agreement to have a binding legal effect, it will have to be recorded at the DGIP.

In general, a licence agreement should cover the details of the licensor and the licensee, the nature of licensing (exclusive or non-exclusive), the ability to sublicense (or not), the terms of the licence agreement, the rights and responsibilities of the parties, and the object or trademark to be licensed.

The licence agreement must not contain provisions that directly or indirectly damage the Indonesian economy, or limitations obstructing Indonesia’s capacity to acquire and develop technology.

AFFA INTELLECTUAL PROPERTY RIGHTS
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