Trademark Law under newly minted Job Creation Law

The highly contentious Law No. 11 of 2020 on Job Creation (“Job Creation Law”) has been enacted despite enormous protests nationwide. The objective is to absorb Indonesian workers as widely as possible amid strong competition and the demands of economic globalization. In supporting the job creation, the law must adjust various regulatory aspects related to business simplification, protection and empowerment of micro, small and medium enterprises (MSMEs), improvement of investment ecosystem for accelerating national strategic projects (PSN) as well as the improvement of protection and welfare of workers. The law amends various prevailing law including Law No. 20 of 2016 on Trademark and Geographical Indications (“Trademark Law”). It indicates major changes on the substantive examination period that significantly reduced to only 30 days from 150 days. Further, the Job Creation Law is also omitting Article 25 paragraph (3) yet adding Article 20 point g of Trademark Law.

Functional form is not allowed

The Section VI of Job Creation law indicates the significant changes towards Indonesian Trademark Law. Firstly, Article 108 paragraph (1) amends the Article 20 of Trademark Law, which states:

“A mark cannot be registered if:

a. it contradicts the state’s ideology, laws and regulations, morality, religion, norms of decency, or public order;

b. it constitutes, is related to, or is simply stating the goods and/or services being applied for registration;

c. it contains elements which may mislead the public on the origin, quality, kind, size, type, purpose of use of the goods and/or services being applied for registration or constitutes a name of a protected variety of a plant for similar goods and/or services;

d. it contains information that does not match the quality, benefit, or efficacy of the goods and/or services being produced;

e. it does not have distinguishing features;

f. it is a generic name and/or public symbol; and/or

g. it contains a form that is functional.”

Point g above is the new provision to emphasise the distinctiveness of marks for registration. Considering the lack of distinctiveness of mark applications shall be rejected, thus it allows others to freely use any form that is functional. There is no further explanation as to what functional is under Job Creation Law. However, functional is generally considered as a non-distinctive or lack of distinctiveness mark which visualised on logo, shape, combination of colour or is a description of the function of the product. Distinctiveness is important element affecting the quality of a brand in line with its main function as the identity of goods or services. When a brand only serves as an indication of the form, function, quality or other characteristics of the goods or services, consumers will consider this as a means of obtaining general information about the goods or services.

 

Faster registration process

Second, Article 23 paragraph (5) of Trademark Law determines the Substantive examination shall be completed within a maximum period of 150 days. While Article 108 paragraph (2) of Job Creation Law clearly reduced the period to only 30 days. The Job Creation Law expedites the process of mark registration, in case there is no opposition or objection against the mark, which is way more effective for the brand owner for their business objectives.

 

Obligation to retrieve the certificate

Lastly, Article 25 paragraph (3) of Trademark Law is omitted under Job Creation Law, under which the registered Mark is deemed as withdrawn and deleted if the brand owner or its Proxy do not retrieve the certificate within a maximum period of 18 months, as of the issuance date of the certificate. Since mark certificate is now can be retrieved by online system in Directorate General of Intellectual Property (“DGIP”), the mark owner or its Proxy may access the certificate anywhere without having to come to DGIP.

Written by: Threeas Novayanti