On October 28, 2024, the Indonesian Parliament enacted Law No. 65 of 2024 which amends  Law No. 13 of 2016 on Patents (the 2024 Patent Law). Among its significant changes, the 2024 Patent Law introduces a significant statutory compliance requirement for all patent holders, which, if disregarded, could lead to a patent being subjected to compulsory licensing or even invalidation. This new obligation centres on the Annual Statement of Working (SOW) or implementation statement. 

The legal obligation to submit an annual SOW 

The foundation of this requirement lies in Article 20A of the 2024 Patent Law. This article mandates that every holder of active patents must annually submit a SOW to the Directorate General of Intellectual Property (DGIP) describing the implementation of their patents in Indonesia. 

• Content: The statement must indicate whether the invention is being worked in Indonesia via manufacturing, use, importation or licensing; or, if not yet worked, an affirmative statement to that effect (using template provided by the DGIP). 

• Deadline: The current provisional online system sets the deadline as December 31 each year for all active patents, regardless of their grant date. 

Since the statute clearly obligates patent holders to submit this statement, non-filing constitutes a breach of a statutory compliance requirement under the 2024 Patent Law. This obligation is not optional; it represents a direct statutory duty under Article 20A. 

The connection to SOW requirements and historical precedent 

The annual SOW is intrinsically linked to Indonesia's long-standing patent working requirement. 

Historical context 

While the new Article 20A introduces a procedural reporting duty, it also reinforces Indonesia’s long-standing working requirement. Under the previous Patent Law No. 13 of 2016, Article 20 required patent holders to “make or use” their patented invention in Indonesia. Historically, failure to comply with this obligation could justify the grant of a compulsory licence under Article 82. 

Continued risk 

The updated law broadens the notion of “implementation” to include not only manufacture or use, but also importation or licensing. Nevertheless, the fundamental obligation to work or implement the patent remains a key compliance requirement. Failure to comply with the annual SOW requirement may lead to risks of compulsory licensing or partial or complete invalidation of the patent. 

Although the statute does not explicitly state that non-filing automatically triggers invalidation or a compulsory licence, the combination of (i) a statutory duty to submit the SOW, (ii) established enforcement practice regarding non-working, and (iii) the recognized link between working and validity, means that non-filing constitutes a meaningful risk factor for patentees. 

Exposure to compulsory licensing and invalidation 

Failing to submit the annual statement significantly weakens a patentee's defensive position against challenges. 

Compulsory licensing risk 

The working obligation requires the patentee to either demonstrate use or working in Indonesia (manufacturing, use, importation, licensing) or at minimum submit the annual SOW declaring its implementation status, including non-use / not yet implemented, if applicable. 

Without a filed SOW, patentees lack public evidence of compliance or justification for non-use. This opens the door for third parties to argue that the patentee has failed to meet the implementation requirement. Under Indonesian law, third parties may request a compulsory licence when a patent is not worked in Indonesia. 

Invalidation risk 

The risk of invalidation, either partial or total, is also a serious concern. Under Article 132 of the previous law (retained under the 2024 Patent Law), a patent may be invalidated if the holder violates the implementation obligation. The interpretation of the 2024 Patent Law confirms that non-compliance with Article 20 remains a ground for invalidation. 

Since the annual SOW is the mechanism for monitoring implementation, non-filing may be interpreted as non-compliance with the law’s working obligation, serving as a silent indicator of non-use. The statute allows for partial invalidation (for example, claims that are not implemented) rather than necessarily full invalidation, which still presents a substantial risk. 

Conclusion and risk management 

There is legal basis to conclude that non-filing of the annual SOW creates a heightened risk that the patent could become subject to compulsory licensing or partial or full invalidation. 

Risk summary 

The risk is grounded in: 

1. Statutory obligation: Article 20A imposes a clear legal duty. 

2. Historical enforcement: Failure to implement has always been grounds for compulsory licence or invalidation. 

3. Increased exposure: Non-filing undermines the patentee’s ability to document use or declare implementation status, making it easier for an adversary to assert non-use. 

Caveats and practical steps 

It’s important to note that : 

• Non-filing alone does not necessarily mean non-use; however from an evidentiary standpoint, non-filing weakens the patentee’s position. 

• Non-filing does not automatically result in immediate compulsory licensing or invalidation; enforcement depends on the facts of each case and whether a third party initiates a challenge. Furthermore, the implementing regulation for Article 20A is not yet finalized, leading to some legal uncertainty regarding specific enforcement mechanisms. 

From a practical viewpoint, submitting the SOW is a relatively low-cost compliance step. By doing so, patentees establish essential documentation that can significantly strengthen patentee’s defense against allegations of non-use or non-implementation. Conversely, failure to submit leaves the patentee exposed to avoidable risk. 

Accordingly, all patentees should prepare and submit their SOW well in advance of the annual December 31 deadline in order to avoid the rush period and ensure full compliance under the 2024 Patent Law.