Introduction to intellectual property
From HAKItree
Trade marks
What is a trade mark?
A trade mark is a sign in the form of a picture, name, word, letters, figures, composition of colours, or a combination of these elements, used in trade to distinguish the goods and services of one trader from those of another i.e. to function as a badge of origin.
How are trade marks protected in Indonesia?
Trade marks are registered with the Trade Marks Office (TMO). A mark may be registered by a person, several persons jointly, or a company. Trade marks are registered in relation to particular goods or services. The International Classification of Goods and Services sets out the 45 classes of goods and services in relation to which marks can be registered. You will need to specify the particular goods or services in relation to which you wish to register. More classes means broader protection, but higher cost.
How long does registration take?
It usually takes two years for the registration certificate to be issued. Once an application is filed, the TMO examines it to check that all formalities have been complied with and that there are no prior conflicting marks. If objections are raised, the TMO will issue a letter and the applicant then has 30 days in which to respond. If the application is accepted by the TMO, it will be published in the Government Gazette. At any time within three months of publication, it may be opposed by third parties on various grounds including similarity of the mark to prior registered marks. If no opposition is raised, the TMO will issue a registration certificate.
How long does a trade mark registration last?
Once registered, a trade mark is protected in Indonesia for 10 years from the date of filing. The registration can be renewed for subsequent periods of 10 years. Applications for renewal can be filed up to 12 months before expiry of the then current registration period, but not thereafter.
What marks are not registrable?
Any trade mark can be registered except a mark which:
- has been applied for in bad faith (such as a pirated mark);
- is contrary to laws and regulations, morality or religion, or public order;
- has no distinctive features (e.g. the number 1 alone, or a common word);
- has become public property (i.e. is generic - the name by which the goods are commonly described);
- is descriptive of the goods or services for which registration is sought;
- is identical with or similar to a prior registered mark for similar goods or services;
- is identical with or similar to a well-known mark for similar or dissimilar goods or services (a mark will qualify as a well-known mark only if certain criteria are met);
- is similar to a known geographical indication (i.e. Champagne or Toraja); or
- constitutes or resembles the name of a famous person, photograph or the name of a legal entity (e.g. a company name).
Must the trade mark be used?
The trade mark must be used in exact accordance with the mark as registered. If the mark is not used commercially for a consecutive period of three years from the date of registration, or any consecutive three year period thereafter, the registration can be deleted by a third party making application to the court on the ground of non-use. The trade mark can be used with the symbol ® to indicate it is a registered trade mark or the symbol ™ if it is not registered. Registration numbers are technically required by the law to be shown on goods.
What if I license use of the mark?
The law states that unless a licence agreement has been recorded at the TMO it will have no effect on third parties. However, as of 2008, the regulations for licences have not been implemented and it is not yet possible for licences to be recorded. The use of a mark by a licensee is deemed to be use by the owner of the mark. A licensee, as well as the trade mark owner, can commence infringement proceedings.
Patents
What is a patent?
A patent is a right granted to an inventor in respect of his invention. It can be obtained for a new or improved machine or process, article of manufacture, or chemical composition.
How are patents protected in Indonesia?
Two types of patent are recognised in Indonesia – standard patents (for products and processes) and simple patents (for products only).
There are two ways of obtaining registration. You can apply for a patent directly by filing an application at the Patent Office. Alternatively, you can file an application under the Patent Cooperation Treaty (PCT) at WIPO in Switzerland and designate Indonesia as a country in which protection is sought. The PCT is a system which allows the applicant to file one application and designate other member countries. This is a cost effective system where protection is being sought in many countries. For all applications, applicants need to specify, in a series of claims, the scope of the protection sought and to explain, by means of technical descriptions and drawings, how to work the invention.
How long does registration take?
That depends on the type of patent you want. Simple patents can take about two to three years. Standard patents are more likely to take three to five years from filing in Indonesia.
Standard patents are substantively examined upon request following a 6 month publication period for opposition purposes. Once a standard application has been filed with the Patents Office and formalities met, it will be published in the Official Gazette. Publication usually takes place after 18 months from filing date or priority date. Any party may file an opposition within six months of the date of publication. Then the application will proceed to ‘substantive examination’, provided a specific request by the applicant is made to the Patents Office within 36 months of the date of filing.
In the case of Simple Patent, he application will be published after 3 months from filing of application. There will be examination following publication.
How long does a patent last?
A standard patent is granted for 20 years from the filing date. A simple patent lasts for 10 years from the filing date. Yearly payments must be made after grant to keep the patent alive.
What inventions are patentable?
Any invention is patentable provided it:
- is new, i.e. not the same as any previous technological disclosures either in or outside Indonesia. (There are exceptions for inventions that have been disclosed in international exhibitions or used in relation to experiments for the purposes of research and development up to six months before filing);
- involves an inventive step, i.e. is not obvious to a person who is skilled in the art; and
- is capable of industrial application; i.e. useful.
Unlike standard patents, where all three criteria must be met, simple patents require only that an invention should be new and have practical utility. It is, therefore, easier to obtain a simple patent.
However, even if you satisfy the above criteria, a patent will not be granted if the invention relates to:
- a process or product that contravenes prevailing rules and regulations, religious morality, public order or ethics;
- a method of examination, treatment, medication and or surgery applied to humans and/or animals;
- any theory and method in the field of science and mathematics;
- a living creature (other than a micro-organism); or
- any biological process that is essential in producing a plant or animal.
Must the patented invention be used?
If a patented invention has not been used three years from the date of grant, any party may file a request for a compulsory licence with the Patents Office. A royalty will be payable to the patent owner. If process patents are not worked in Indonesia, the patent owner may be precluded from objecting to the unauthorised importation of goods manufacted by the process covered by the patent.
Can you license use of the patent?
Yes. The law states that unless a licence agreement is recorded at the Patents Office, the licence will have no effect on third parties. However, as of 2008, the regulations have not been implemented and it is not yet possible for licences to be recorded.
Industrial designs
What is an industrial design?
An industrial design protects the shape or configuration of three dimensional industrial or handicraft articles, or patterns applied to their surface. Examples of articles that may qualify for design protection range from household appliances, such as blenders or shavers, jewellery, watches and perfume bottles, to components of industrial machinery. A batik or ikat design may also be capable of protection.
How are industrial designs protected in Indonesia?
Industrial designs may be registered with the Industrial Designs Office. Unless otherwise agreed, it is the designer(s) who created the industrial design, who is entitled to registration.
Industrial designs are registered in relation to particular goods. It is necessary to specify the goods, following the Locarno Classification.
How long does registration take?
It usually takes 12 months for the registration certificate to be issued. Design applications are not examined as to substance. Once an application has been filed and all formalities complied with, it will be published by the Industrial Designs Office. Any third party may oppose the application within three months of the date of publication. If no opposition is filed, the application will be accepted, and a certificate of registration issued.
How long does an industrial design registration last?
Once registered, an industrial design is protected in Indonesia for a period of 10 years from the date of filing the application. The registration cannot be renewed.
What industrial designs are not registrable?
Any industrial design can be registered except an industrial design that:
- is not new (either in Indonesia or overseas) at the time of filing. (Novelty is not destroyed if the design is displayed in international exhibitions or used in experiments for education, research and development purposes up to six months before filing); or
- is contrary to prevailing laws and regulations, public order, religion or morality.
Can you license use of the industrial design?
Yes. The law states that unless a licence agreement is recorded at the Industrial Designs Office, the licence will have no effect on third parties. However, as of 2008, the Regulations for the recordal of licences had not been drafted and it is not yet possible for licences to be recorded.
Copyright
What is copyright?
Copyright is the right to prevent others from copying a particular form of expression. It does not protect the underlying facts, ideas or concepts. Works in the field of science, arts and literature, including the following, are capable of being protected by copyright:
- books, computer programs, pamphlets and typographical arrangements;
- sermons, lectures, addresses;
- visual aids made for educational and scientific purposes;
- songs or music with or without lyrics;
- dramas, musical dramas, dances, choreographic works, puppet shows, pantomimes;
- all forms of art, such as paintings, drawings, engravings, calligraphy, carvings, sculptures, collage and applied arts;
- architecture, maps, batik art, photography;
- cinematographic works; and
- translations, interpretations, adaptations, anthologies and databases.
What are moral rights and related rights?
Moral rights are rights given to authors to enable them to ensure that they receive proper acknowledgement as the author of their works and that the integrity of their works is maintained.
Some related rights, similar to copyright, exist in performances, phonographic works, sound recordings and broadcasts. These works may not be copied or communicated to the public without consent.
How is copyright protected in Indonesia?
Copyright arises automatically at the time a work is created in material form. It is not necessary to register your copyright at the Indonesian Copyrights Office to have protection, and registration is not validation of the content of the registered work. However, many people in Indonesia choose to register copyright , or leave dated samples of the copyright work with someone independent i.e. their lawyer, .as a first step to proving ownership.
Indonesia is a party to the Berne Convention, so works of foreign nationals will be automatically protected in Indonesia if the author is a national of a country that is also party to the Berne Convention, or the work was first published in a country that is a party to the Berne Convention. This covers most industrialised countries.
How long does registration take?
It usually takes about 12 months for the registration certificate to be issued. Once the application has been filed and all formalities complied with, the Copyright Office registers the copyright and issues a certificate of registration.
How long does copyright protection last?
Generally, copyright lasts for the life of the author and 50 years after his death. In relation to computer programs, cinematographic and photographic works, databases and adaptations, copyright lasts for 50 years from the date of first publication. Performing rights and recording rights last for 50 years from date of performance or production and broadcasting rights for 20 years from date of first broadcast.
Can you license use of the copyrighted work?
Yes. The law states that unless a licence agreement is recorded at the Indonesian Copyright Office, the licence will have no effect on third parties. However, as of 2008, the Regulations for the recordal of licences have not been implemented and it is not yet possible for licences to be recorded.
Other rights
Indonesia protects other IP rights such as plant varieties, integrated circuit designs and trade secrets.
Registering and securing your IP is pointless unless you actively take steps to protect your assets from being used by third parties. This is especially important in Indonesia where the level of piracy and counterfeiting is high.
Enforcement
Investigation
IP owners usually learn of counterfeiters through their own employees or by sightings referred by their lawyers or investigators. Once infringements have been detected, enquiries should be conducted to determine how bad the problem is, and who is responsible for it. This will help you formulate a strategy for dealing with the infringement.
A good investigation will reveal the following:
- who the infringer is and the size and nature of his business activities;
- whether the infringer manufactures, imports, distributes or sell the goods; and
- the extent and nature of infringement – the volume of goods and how the mark is used.
Cease and desist letters
If the level or impact of a counterfeit product is low, a simple and cost effective step to enforce your IP rights in Indonesia may be to have your lawyer simply write to the infringer warning him of your rights and demanding that he stop all use of your IP. If the infringer agrees, he can be asked to sign a written undertaking. Successful negotiation of such settlements is common in the case of merchandise counterfeiting, and other situations where the infringer is conducting a legitimate business. Delivery up of infringing goods and compensation is possible, although uncommon, at this stage.
Police raids
If the level of counterfeiting is high and you know where the infringing goods are made or kept, a raid can be conducted to seize the infringing goods. The raid is generally initiated by the owner of the IP rights filing a complaint with the Police. The Police have the power to seize and destroy infringing goods and arrest infringers. A successful raid is effective in ridding the market of the infringing goods and is therefore an important tool in combating infringement. But IP holders are required to work closely with the Police during the raid.
Criminal prosecutions
If the IP holder pursues his complaint after a raid, the Police will complete their investigations, then transfer the case to the Public Prosecutor. If the Public Prosecutor finds that the investigation and the evidence are sufficient, a criminal prosecution will be filed at the District Court. If there is a conviction, the infringer will have to pay a fine and/or be sent to prison. However, poor understanding of economic crimes means that penalties are often low. Further, corruption is a problem in the Indonesian legal system. Prosecutions should be pursued only if you want to send a warning to other potential infringers, or have longer term deterrent goals.
Civil proceedings
If a cease and desist letter fails or a police raid or criminal prosecution are not appropriate, a case can be brought in the Civil Courts, provided you have sufficient evidence. Available remedies include injunctions, search and seizure orders and damages. A permanent injunction is an order of the Court to cease illegal activities like counterfeiting. You can, at the outset, request a preliminary injunction i.e. an order to cease such activities pending trial. An application for a preliminary injunction must be accompanied by a bank or cash guarantee. If the Court ultimately decides that your case has no merit, the order for the preliminary injunction will be discharged and the guarantee forfeited to the infringer as compensation. Although well known abroad, this remedy was introduced in Indonesia only in 2001, so is still relatively new. Few have yet been granted.
Damages can be claimed, although you need to prove actual loss and/or a method of quantifying that loss.
Commercial exploitation
IP is an asset and, like all assets, should be properly managed, especially in a country like Indonesia, where the business environment can sometimes be difficult. Failure to secure proper ownership has on many occasions resulted in IP holders losing their IP rights to unscrupulous local traders. The IP laws offer some protection, but you can double this by using the parallel laws of contract, to create separate obligations and systems to guard your IP. IP holders should always consult expert commercial advisers at the outset, structuring deals involving IP to ensure that ownership and control is retained.
In many cases, IP holders have business partners in Indonesia, to whom they trust the development and exploitation of their IP. Such arrangements require ongoing management and monitoring. Disputes often arise where one partner’s expectations differ from those of the other. IP holders should actively manage their IP, not abandon it once the deal is done. Distributorship, franchise, manufacturing and licence agreements all need to be carefully drafted to ensure that there is adequate protection. In employment contracts, confidentiality clauses may prohibit an employee from disclosing trade secrets and provisions can be included to ensure that you enjoy the fruits of your employees’ works produced in the course of employment or using company resources. Such internal safeguards are often overlooked. Suppliers must be carefully monitored to ensure they do not produce overruns for backdoor supply. Many of the frequent disputes over trade marks, franchises, distribution, and manufacturing might have been avoided with more careful contractual planning and relationship management.
Sale and purchase of assets involving IP is often complex, with particular attention needing to be paid to the representations and warranties made by the parties. It is not uncommon to find that asset sale and purchase agreements place too little emphasis on the IP component, when the real value of the deal may be in the brands and technologies being transferred.
There are often complex regulatory environments to deal with and many products, licences, franchise agreements etc must be registered with government departments. Further, not all business sectors are open to foreign investment, and care must be taken to ensure that your arrangements are legal and enforceable.
In addition to capital value, IP can generate large incomes if properly managed.. However, quality controls should be put in place regarding the use of your IP to ensure that its value grows and is not diminished, and that your revenue streams are preserved.
