The Intellectual Property Review: Indonesia

Forms of intellectual property protection

Intellectual property protection and enforcement in Indonesia have existed in Indonesia since the era of the Dutch colonial government, which enacted Auteurswet Stb No. 600 of 1912 (Copyright), Ooctroi Wet No. 313 of 1910 (Patent), and Reglement Industriele Eigendom No. 545 of 1912 (Trademark). Even after the independence of Indonesia in 1945, these laws were still relevant and remained in force until 1961, when the government of the Republic of Indonesia enacted Law No. 21 of 1961 on Marks, Law No. 6 of 1982 on Copyrights, and Law No. 6 of 1989 on Patents. As time went by, Indonesia further ratified various international agreements concerning intellectual property rights.

Currently, Indonesia is a party to the Agreement on Trade-Related Aspects of Intellectual Property Rights, the Madrid Protocol, the Beijing Treaty on Audiovisual Performances, the Berne Convention, the Paris Convention, the Patent Cooperation Treaty and the WIPO Copyright Treaty. Furthermore, Indonesia is also a party to several bilateral or regional agreements and treaties, such as the ASEAN Patent Examination Cooperation and the Japan–Indonesia Patent Prosecution Highway.

Currently, the grouping of intellectual property rights in Indonesia is as follows.

Intellectual property protection grouping in Indonesia
CopyrightsIndustrial rights
Copyrights
Related rights
Trademarks and geographical indications
Industrial designs
Patents – covers conventional patents, and utility models and simple patents
Plant varieties

Trade secrets
Integrated circuit layout-designs

The legal bases of the above-noted protections are as follows:

  1. Law No. 29 of 2000 on Plant Varieties
  2. Law No. 30 of 2000 on Trade Secrets;
  3. Law No. 31 of 2000 on Industrial Designs;
  4. Law No. 32 of 2000 on Integrated Circuit Layout-Designs;
  5. Law No. 28 of 2014 on Copyrights (the Copyright Law);
  6. Law No. 13 of 2016 on Patents (the Patent Law);
  7. Law No. 20 of 2016 on Trademarks and Geographical Indications (the Trademark Law); and
  8. Law No. 11 of 2020 on Job Creation (the Omnibus Law).

i Simple patents and utility models

Simple patents and utility models are governed by the Patent Law and the Omnibus Law. Subject to registration, simple patents provide for the grant of exclusive rights if the patent can fulfil the following criteria:

  1. novelty;
  2. development of known products or processes;
  3. possession of practical uses; and
  4. commercial application.2

This covers simple products, simple processes or simple methods. Once registered, simple patents or utility models are valid for 10 years from the filing date.

ii Patents

Unlike simple patents or utility models, conventional patents are not affected by the Omnibus Law and their protection is governed solely by the Patent Law. Subject to registration, conventional patents provide for the grant of exclusive rights if the patent can fulfil the following criteria:

  1. novelty;
  2. inventive steps; and
  3. commercial application.

Conventional patents can cover both product and process patents. Once registered, conventional patents are valid for 20 years from the registration filing date.

Notably, there are inventions that cannot be registered, such as aesthetic creations, schemes, business methods, computer programs per se, presentations of information, and discoveries that are considered to be new uses for known products or new forms of existing compounds that do not result in a significant increase in efficacy and exhibit differences in related chemical structures known from the compounds.3

iii Trademarks

Trademarks (as well as geographical indications) are regulated under the Trademark Law. Registration is carried out on a first-to-file basis, and registered trademarks are valid for 10 years, with effect from the registration filing date. While no prior use requirement is essential for the purposes of application and registration, it is advisable always to use registered trademarks to avoid non-use cancellation actions filed by any third parties. Furthermore, Indonesia adopts a strict classification system on its e-filing platform. Any goods or services that do not exist in the system may not be filed – hence prior checking is advised.

iv Copyrights

Copyrights are governed by the Copyright Law. The Copyright Law protects various intellectual property assets in the realms of art, science and literature. The protection period starts from the first date of publication and depends on the nature of the protectable work. For instance, software and other computer programs are protected for 50 years from their first publication date, whereas songs and books are protected for up to 70 years after the death of their creator.4

Recent developments

The Omnibus Law adjusted several provisions in both the Patent Law and the Trademark Law in 2020. The changes focused on several aspects of patents and simple patents. The most significant change is the obligation to use or work registered patents in Indonesia, otherwise they are prone to be invalidated or subject to compulsory licensing. This marked the end of the prior practice, whereby it was feasible to postpone the use of registered patents by submitting written requests to the Indonesian Patent Office. Compulsory licensing can be requested if a registered patent has not been used or worked in Indonesia within 36 months of registration.

Furthermore, during the covid-19 pandemic, Indonesia pushed for the use of registered patents deemed necessary to mitigate the virus. For instance, the President issued Presidential Regulation No. 100 of 2021 on the Implementation of Patent Rights by the Government on Remdesivir Medicine, whereby the government may appoint a pharmaceutical industry body to employ the patent if its use remains non-commercial in nature. Furthermore, the patent holder will receive 1 per cent from the net sales of remdesivir. Furthermore, the President also issued Presidential Regulation No. 101 of 2021 on the Implementation of Patent Rights by the Government on Favipiravir Medicine, the content of which is identical to the Regulation on remdesivir. The issuance of these Regulations shows the President finally using Presidential Regulation No. 77 of 2020 on Patent Use by the Government, which allows the emergency use of essential medications in the event of a health crisis in Indonesia.5

Obtaining protection

The Patent Law was enacted in 2016 and the government eventually issued the much anticipated patent examination guidelines in 2019. The current Law differs from its predecessor in that it does not recognise the patentability of various types of subject matter, such as business methods, computer programs per se, new uses for existing products and new forms of existing compounds.

Article 4(c)(3) of the Patent Law excludes the patentability of business methods. Such patentability can, however, be recognised if the computer-implemented business method has technical character through technical means, as further explained by Annex 3, Section 2.4 of the technical guidelines.

Article 4(d) of the Patent Law also excludes the patentability of computer programs. However, computer-implemented inventions are patentable, as described in Annex 3, Section 2.1 of the technical guidelines. A computer-implemented invention is an invention that is realised using a medium such as a computer: one or more features of the invention are fully or partly realised by a computer program. The distinguishing feature of a computer-implemented invention is a program feature. A computer program is considered an invention if (1) it involves a technical means such as a computer, server, phone, censors or devices, and (2) when run on a computer, it produces, a further technical feature outside normal physical interaction between computer program (software) and computer. Computer-implemented inventions can be categorised as process inventions (which include methods) and product inventions (which include systems, devices, computer programs or computer-readable storage media, or a combination of these).

Furthermore, Article 4(f)(1) of the Patent Law excludes the patentability of new uses of existing products. This also excludes patentability of second or further medical use, which was previously patentable under the former Patent Law.6 The Swiss-type second medical use format (previously used as an alternative for method-of-treatment claims that were otherwise not patentable under the previous Patent law) is no longer patentable under the current legislation. Several exceptions are discussed in Annex 1, Section 5.2 of the technical guidelines, such as new uses for existing products being patentable when the protection of claims is directed to compound X with the feature of disease Y as a limiting or distinguishing feature. In cases of this kind, the claim protection is intended to allow a pharmaceutical industry body to produce a drug X that is indicated to treat only disease Y. The disease feature must be completely novel and inventive, must not involve the same action mechanism as the prior art and must be supported by clinical trial data, in vivo testing or in vitro testing in the description. The dosing regimen, administration time or frequency, patient group and action mechanism of the drug cannot be the distinguishing feature in product-for-new-use claims. An example of a patentable claim would be 'compound X for use in treating allergy', where the prior art indicated compound X for use as pesticide.

Article 4(f)(2) of the Patent Law excludes the patentability of new forms of existing compounds. Based on Annex 1, Section 5.3 of the technical guidelines, new forms include chemical chirality such as enantiomers or diastereomers, crystal forms, solvate forms, hydrate forms, salts, prodrugs and metabolites of existing compounds. Patentability can be acknowledged for new forms that result in meaningful efficacy improvement, which is further explained in Annex 1, Section 2 of the technical guidelines. Meaningful efficacy improvement may include increased bioavailability, improvement in stability, increased solubility, decreased toxicity, improvement in safety, improvement in potency, broader activity spectrum, decreased production cost or decreased treatment period. The meaningful efficacy improvement should be supported by experimental data.

Article 9 of the Patent Law also further excludes the patentability of methods of examination, treatment, medication or surgery applied to humans or animals. This is further explained in Annex 1, Section 6 of the technical guidelines. In vitro, ex vivo, and in silico methods of examination or diagnosis are still patentable under this law. Non-therapeutic methods of treatment, such as cosmetic treatments, diet or other non-health-related treatments, are still patentable. In vivo methods of examination, therapeutic methods of treatment, methods of surgery and methods of medication applied to humans or animals are not patentable.

Also excluded in Article 9 of the Patent Law are living organisms. An exception is made for microorganisms such as yeast, fungi, bacteria and actinomycetes. An exception also applies to human cells and plant cells. Embryos, seeds, parts of plants, tissues, organs, transgenic plants and genetically altered animals are not recognised as patentable. New strains should be described specifically and the difference from known strains from the same species should be described for the novelty to be acknowledged. A novel microorganism with a different taxonomy is acknowledged as inventive. In relation to living organisms, patentability for essential biological processes for producing plants or animals is also excluded. Non-biological processes or microbiological processes are, however, patentable. Non-essential biological processes are biological processes that need human intervention, such as plant tissue isolation methods. Microbiological processes are biological processes that include microorganisms, such as fermentation. Artificial insemination, cross pollination and other processes that can occur naturally without human intervention are not patentable.

Nucleotides such as DNA, cDNA, primers, genes, vectors or transformants are patentable. Patentable nucleotides are nucleotides in the form of isolated nucleotides. Genes can be characterised by a polynucleotide sequence, an amino acid sequence or a mutation code. Vectors can be characterised by DNA sequence, DNA restriction map, molecular weight and number of base pairs. Transformants can be characterised by one host cell and the introduced gene (sequence). The novelty of gene sequences is examined through BLAST searches7 or National Center for Biotechnology Information databases. Gene sequences are acknowledged as inventive when the sequence activity is different, at least qualitatively.

Enforcement of rights

i Possible venues for enforcement

The venue for civil enforcement of all intellectual property rights is the court of commerce of the relevant regional district court. If one of the parties is a non-Indonesian person, the venue for enforcement will be the Court of Commerce of the Central Jakarta District Court.8 A plaintiff may seek injunctions from the court in respect of an ongoing infringement and resulting damage. In addition, the court of commerce is also responsible for invalidation and cancellation actions, provided that the plaintiff has solid evidence. Should any of the involved parties not be satisfied with the decision issued by the court of commerce, a cassation procedure can be filed with the Supreme Court of the Republic of Indonesia.

For criminal actions, rights holders can file complaints to the Indonesian National Police or to the civil investigator at the Directorate General of Intellectual Property under the Ministry of Law and Human Rights.9 The latter is given the authority to conduct investigation by the government. The civil investigator is responsible for issuing the Notice of Commencement of Investigation, and the Notification of Investigation Results to the police. Once an investigation has been concluded, the case will be passed on the state prosecutor to be tried before the district court.

ii Requirements for jurisdiction and venue

To claim an infringement, the rights holder must present evidence to prove ownership over a title. This can be shown through an original registration certificate. For patents, the holder may also need to prove that the validity of the patent registration that forms the basis of the claim has been maintained through continuous annuity payments. Furthermore, a registered licensee can also act on behalf of a rights holder to initiate a claim before the court of commerce.10

iii Obtaining relevant evidence of infringement and discovery

In Indonesian civil procedure, the burden of proof regarding the facts on which a claim is based lies with the plaintiff. Article 1865 of the Indonesian Civil Code states that anyone who claims to have a certain right or who refers to a fact to support such a right, or who objects to another party's right, must prove the existence of that right or that fact. Evidence may comprise written evidence, evidence presented by witnesses, or through inference, confession or oath.11 In our experience, it is prudent to collect as much diverse evidential material as possible, such as purchases made by mystery shoppers, marketing materials found online and offline, and expert witnesses that may provide substantive statements pertaining to the alleged infringement.12 Furthermore, written evidence must be presented in the Indonesian language – translated by a sworn translator if necessary.

Note that there is no discovery process in Indonesian legal practice and parties do not have a right to demand the submission of documents.

However, unlike trademark, copyright and industrial design disputes, there is a possibility that the burden of proof in a patent dispute may lie with the defendant if the product that results from the patented process is novel or where the product is suspected to have resulted from a patented process (and despite there being a sufficiently evidential process in place), the patent holder is still unable to determine the process used to produce the aforementioned product. While the reversed burden of proof is possible under the Patent Law, the court of commerce will, in practice, still require the plaintiff to produce evidential material to establish the rights (i.e., through a patent certificate).

iv Trial decision-maker

Unlike in various jurisdictions where there are specialised courts or judges that specialise in intellectual property matters, Indonesia does not have such a system. Bear in mind that the court of commerce discussed above also caters for non-IP matters if the dispute is of a commercial nature. Also, the judges do not have science backgrounds – hence the importance of involving expert witnesses during the suit. Note also that Indonesia has not adopted the jury system, and judges play an important and active role in court hearings. Furthermore, precedents are considered to be merely advisory in nature and they do not have binding legal force as in common law systems.

v Structure of the trial

Civil proceedings in Indonesia are conducted in writing and oral arguments. The judges will listen to the oral arguments of each party one at a time, and they rely heavily on the documentary evidence. Witnesses of fact can also provide oral evidence before the court. However, a witness statement or affidavit alone will not be sufficient since it is considered merely supplementary documentary evidence. In general, the procedure of the trial is as follows:

  1. attendance at the first hearing after the court summons both plaintiff and defendant;
  2. attendance at the second hearing, when the defendant files its response to the plaintiff's cancellation suit;
  3. preparation of the plaintiff's reply to the defendant's response to the suit;
  4. attendance at the third hearing to file the plaintiff's reply;
  5. attendance at the fourth hearing when the defendant files its response to the plaintiff's reply;
  6. preparation of the plaintiff's evidence to be submitted to the court;
  7. attendance at the fifth hearing to submit the plaintiff's evidence and review the defendant's evidence;
  8. preparation and filing of the conclusion of the case based on documents and evidence filed with the court by both plaintiff and defendant;
  9. attendance at the sixth hearing on the filing of the conclusion of the case;
  10. attendance at the seventh hearing to hear the judges' decision; and
  11. issuance of the court's decision.

For patent disputes, pursuant to Article 145(4) of the Patent Law, the trial can be conducted in a private manner if both parties make a request to the court of commerce for the trial to be private. This is to protect the secrecy of processes that would be easily manipulated or improved by a person knowledgeable in the relevant field.

vi Infringement

To claim an infringement, a claimant must be able to prove that the infringed product or process is identical to that claimed in the patent registration. The patent holder may pursue both a criminal and a civil suit – the latter to seek damages for the infringement proven during the criminal proceedings. A defendant that has been penalised for an infringement may still be liable to a civil damages claim by the plaintiff.

Under the Patent Law, there are nine types of conduct that constitute patent infringement, namely manufacturing, using, selling, importing, leasing, transferring, providing for sale, providing for lease and providing for transfer. It only takes one of these to be proven for the patent holder to be able to pursue the infringement.

vii Defences

There are several strategies for defending against a patent infringement claim. One of the most practical methods of defence is to see if the plaintiff has worked its patent in Indonesia pursuant to Article 20 of the Patent Law, which states that a registered patent must be worked or used in Indonesia to remain in force. Failure to work or use the patent in Indonesia may result in any third party filing for invalidation of the patent at the court of commerce. Alternatively, a defendant may challenge a patent's novelty by providing prior art as evidence for the patent's invalidation at the court of commerce. Apart from the novelty issue, one can also challenge the inventive step or industrial applicability of a patent. Invalidation or nullification is perhaps one of the most practical methods of defence available in Indonesian practice.

Furthermore, the Patent Law also provides an opportunity for a prior user of a disputed patent to defend itself if that user can prove that the use of the disputed patent does not rely on a specification, claims and figures identical to those of the registered patent. Nevertheless, the prior use must be recorded at the Patent Office to be officially recognised as such.13

viii Time to first-level decision

Note that by law the court of commerce must issue its decision within 180 days of the date of filing of the suit in patent matters,14 and within 90 days of the date of filing of the suit for trademark matters.15 However, for criminal actions the process may take longer – sometimes from three to nine months if the documents are complete.

ix Remedies

All laws pertaining to intellectual property assets allow the infringed to seek damages through the court of commerce. However, there is no known formula for determining the damages to be awarded. The compensation shall be given based on a final and binding decision of a civil or criminal court. Note that attorney's fees shall be borne by the party that receives legal service from the entrusted attorney. Hence, it will not be possible to seek compensation from the other party for the legal fees already incurred by the claimant or plaintiff.

With regard to injunctions, the Patent Law allows the rights holder to request a provisional injunction to stop the circulation of infringing articles, as well as to secure or collect them, and to avoid greater losses.16 Provisional injunctions may be useful to perform their intended purpose to the extent that they can limit the ability to record a patent registration with the Indonesian Customs. To achieve this, the provisional injunction has to be served to the Indonesian Customs to stop the influx of suspected infringing articles into the distribution channels.17

x Appellate review

The Supreme Court facilitates cassation based on the issuance of the lower court (i.e., the court of commerce). None of the judges have technical backgrounds and it takes approximately eight to10 months for them to issue a decision.

xi Alternatives to litigation

Conflicting parties may settle the dispute via arbitration or other alternative dispute resolutions. The settlement of a dispute by arbitration may be conducted through the Institute for Arbitration and Mediation of Intellectual Property Rights.

Trends and outlook

The most anticipated change in the foreseeable future is the issuance of an electronic version of a patent certificate. Currently, only trademark, industrial design and copyright certificates are issued electronically. This change will greatly benefit patent holders given that the current practice requires them to wait for six to 12 months to receive the original registration certificate.

Footnotes

1 Emirsyah Dinar is the managing partner at AFFA Intellectual Property Rights.

2 Previously, a simple patent or utility model only needs to be novel and can be applied commercially. The Omnibus Law changed the criteria in 2020.

3 Article 4 of Law No. 13 of 2016 on Patents highlights several inventions that are not protectable in Indonesia. It is important to highlight that these limitations mean second medical use claims are no longer allowed.

4 Law No. 28 of 2014 on Copyrights.

5 Presidential Regulation No. 77 of 2020 on Patent Use by Government is just one of the legal bases allowing Indonesia to use remdesivir and favipiravir on emergency basis.

6 Law No. 14 of 2001 on Patents.

7 Basic local alignment search tool, used in bioinformatics.

8 See Articles 142 to 143 of the Patent Law.

9 See Article 159 of the Patent Law.

10 See Article 143 of the Patent Law.

11 See Article 1866 of the Indonesian Civil Code.

12 See Article 619 of the Herzien Inlandsch Reglement (HIR).

13 See Article 14 of the Patent Law.

14 See Article 145 of the Patent Law.

15 See Article 85 of the Trademark Law.

16 See Article 155 of the Patent Law.

17 The Customs Recordal System only accommodates the recordal of registered trademarks and copyrights.

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