Indonesia’s Job Creation Law amends patent, trademark laws
10 November 2020
On October 5, 2020, the Indonesian Parliament passed the Job Creation Law which seeks to improve the country’s investment climate and generate more jobs for its citizens.
It amends 79 laws including Law No. 13/2016 on Patents and Law No. 20/2016 on Trademarks and Geographical Indications.
One of the Job Creation Law’s more prominent features is its reduction of the trademark substantive examination process from 150 days to 30 days provided there are no further third parties challenge.
“We are convinced that such reduction is workable and these remarkable changes will hopefully make Indonesia one of the fastest trademark registration processes in Southeast Asia, only if the law is properly implemented and enforced within the Indonesian Trademark Office,” said Risti Wulansari, a partner at K&K Advocates in Jakarta.
What seem to be a source of worry are the amendments to the patent law. According to Wulansari, the amendments have earned criticisms.
Before the promulgation of the Job Creation Law, Article 20 of the Patent Law read:
(1) The Patent Holder is obliged to manufacture the product or use the process in Indonesia.
(2) Manufacturing products or using the process referred to in paragraph (1) must support the transfer of technology, investment absorption and/or provision of employment.
Under the Job Creation Law, Article 20 now reads:
“(1) Patents must be used in Indonesia.
(2) Use of Patents as referred to in paragraph (1), are as follows:
a) Product-patent implementation which includes create, import, or license of Patented products;
b) Process-patent implementation which includes create, license, or import of products resulting from a given process-Patent; or
c) Method-Patent, systems, and uses implementation which include creating, importing, or licensing products that are resulting from patented methods, systems, and usage.”
“According to the above provision, the Job Creation Law has eliminated the obligation to transfer technology and provision of employment which the government considers burdensome and inhibits foreign investment. We understand that the Job Creation Law is intended to improve the investment climate in Indonesia,” said Wulansari. “However, on the other hand, public fears that Indonesia - as a developed country - may lose its chances and warranty for technology transfer and the provision of employment, and these changes are projected to bring more negative impact than good.”
“In light of the above, as a technology transfer in patents is still considered important by many, we are of the view that instead of removing the obligation to transfer technology and provision of employment, the provision should be grouped, i.e. patents that are obliged to perform transfer technology and provision of employment, and those that are not required with the consideration of the public benefit,” she said.
Wulansari added that although there was public consultation on the Omnibus Job Creation Bill, it lacked participation and meaning. It was also difficult for the public to obtain an official version of the draft bill.
Nevertheless, Wulansari and her firm remain positive about the prospects of the Job Creation Law, provided it is properly implemented.
“We do believe that if the law is properly implemented, such amendments to the IP laws through the Job Creation Law will likely improve the investment climate in Indonesia,” she said, “as these changes are very beneficial and certainly can facilitate patent and trademark holders from abroad whereas the registration processes have become faster and easier for patent and trademark applications.”
Espie Angelica A. de Leon
