US and EU IP judgements on SE Asian countries

Part 3 - Indonesia

Part 3 of this series on the combined views of the EU and US on IPO protection in major SEA economies focuses on Indonesia. 

The EU report says that Indonesia, having enacted new copyright and trade mark legislation, was also moved from Priority 2 to 3 in previous years. But market access barriers, weak governance and corruption continue to weigh down IPR infrastructure. There are high levels of pirated and counterfeit products, and no regulatory data protection. Legislation drafting is not transparent and IPR registration is very slow.  Enforcement by the IPO Investigation team has declined and the Police and Customs remain ineffective. Other concerns are absence of implementing regulations, lack of protection against unfair commercial use, bad faith trade mark registrations, overly lengthy and expensive Court proceedings, Court decisions are not published and contain very brief legal reasoning.  The patent law is cited as having problems.

The USTR shares similar concerns about the 2016 patent law which includes restrictive local manufacturing requirements as additional patentability criteria which “undermine innovation and research and prevent investment”. They mention the lack of regulatory data protection for pharma and plant products. It also questions whether the newly implemented Customs IP recordal system can really benefit foreign right holders, because only those with a local subsidiary can record their IP rights with Customs. The USTR also states that Indonesia GIs law raises questions about the effects of new registrations on pre-existing trade mark rights, and questions the lack of unfair competition laws.

Both the EU and the US look to Indonesia to improve IP enforcement cooperation among relevant agencies, to meaningfully address all concerns. Indonesia is in many senses, less well developed according to both EU and US in IP protection, and thus remains at a higher level of concern than other SEA countries. The EU is in the process of negotiating an FTA which includes a number of IP elements.