You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

January 17, 2023

Indonesia’s New Criminal Code and Intellectual Property

Subscribe to Updates

Indonesia’s new Criminal Code was passed by Parliament on December 6, 2022, and ratified by the president and promulgated on January 2, 2023, as Law No. 1 of 2023. The new Criminal Code will take effect after three years (i.e., January 2, 2026) and is a complete overhaul of the previous version, much of which was based on Dutch law drafted during the colonial period. The Criminal Code currently in effect (sometimes referred to by the initials KUHP after its Indonesian name), dates from 1918 and was codified and unified in 1946 following Indonesia’s independence the year before.

Much of the news surrounding the new Criminal Code has focused on certain controversial passages in the new code, including articles that criminalize insulting the president, cohabitation, blasphemy, and sex outside of marriage, and limit the right to protest. Under the new Criminal Code, anyone found to have violated these provisions could be imprisoned for a period ranging from a few months to a few years.

Apart from the more controversial provisions, several articles in the new Criminal Code relate to intellectual property (IP). IP owners should be aware of these provisions in order to avoid committing punishable acts and to understand the criminal enforcement options for their IP rights. The most relevant parts of the law are discussed below.

Trademark and Branding Infringement

Under the new Criminal Code, the misuse of marks on goods or packaging is punishable by up to four years in prison or a maximum fine of IDR 500 million (approx. USD 32,735), possibly including indemnity. This misuse covers various acts of wrongfully affixing marks on goods or packaging—such as when a counterfeiter makes use of fake or unauthorized branding to falsely imply that goods are genuine. Prosecution of these criminal acts can only commence based on a complaint from the owner of the trademark at issue.

These new offenses under the Criminal Code are in addition to existing prohibitions on unauthorized use of another party’s trademark, which are found in Law No. 20 of 2016 on Trademarks and Geographic Indications. Under this law, use of a mark that is identical or substantially similar to the registered mark of another party for similar goods or services is punishable by a fine of up to IDR 2 billion (approx. USD 130,940), imprisonment for up to four or five years (depending on the degree of similarity between the marks), or both.

While these existing provisions enable enforcement against trademark infringement through criminal proceedings, many trademark owners avoid filing criminal complaints against infringers and instead prefer to pursue alternative dispute resolution methods because it is less costly. However, if parties cannot reach an agreement during settlement negotiations, the case may progress to criminal proceedings in court.

Falsely Asserting Ownership of IP

Under the new Criminal Code, knowingly giving false testimony under oath (or otherwise of legal consequence) is punishable by imprisonment for up to seven years. Being convicted of this criminal offense may also result in revocation of various civil and political rights—including the right to vote.

This prohibition may apply to both IP prosecution and in IP-related court proceedings. For example, signing a declaration of ownership (for IP registration purposes) if the IP is similar to or copies the IP of another party may be deemed giving false testimony. Similarly, signing a declaration of use (for trademark renewal purposes) when the owner has not actually made use of the trademark may also expose the owner to accusations of giving false testimony.

Disclosure of Trade Secrets

Disclosure of an employer’s specialized information is a punishable criminal offense under the new Criminal Code, and a complaint from a company’s management is the starting point for prosecution of such an act. Those who are found to have disclosed secret specialized matters regarding a company where they work or have worked may face imprisonment for up to two years or a fine of up to IDR 50 million (approx. USD 3,274).

These provisions are intended to prevent unfair competition in the business world. Thus, the disclosure of specialized matters mentioned in the code can be interpreted as referring to dissemination of things that could lead to unfair business practices. This includes information that is not supposed to be publicly disclosed, such as company secrets and trade secrets.

Law No. 30 of 2000 on Trade Secrets states that something can be categorized as a trade secret (and thus can be used as the basis for a criminal report) if the information:

  • is not known by the public;
  • is in the field of technology or business;
  • has economic value; and
  • is kept confidential by the owner of the trade secret.

These provisions in the new Criminal Code are inseparable from provisions of Law No. 5 of 1999 on the Prohibition of Monopolistic Practices and Unfair Business Competition. These stipulations prohibit business actors from conspiring with others to obtain competitors’ company secrets that can enable unfair business competition. However, these provisions specifically discuss competing “business actors” who try to obtain competitors’ confidential information rather than the individuals who disclose it, while the relevant provisions of the new Criminal Code expand criminal liability to individuals who provide or distribute such information to competing business actors.

Integration with Indonesian Law

Both the current Criminal Code and the new version stipulate that specific statutory provisions (e.g., those found in the Laws on Trademarks, Trade Secrets, Unfair Business Competition, etc.) prevail over the Criminal Code if there is any discrepancy. This means that if a criminal act is regulated by multiple laws, the applicable provisions in the specific laws take precedence over the Criminal Code’s provisions that apply to that same act. However, the provisions discussed above add some important clarity and expand some criminal offenses, so IP owners should take them into consideration when deciding on IP prosecution or enforcement strategy. This can help with anticipating risks of criminal punishment, as well as understanding the tools available for IP enforcement or litigation.

Related Professionals

Practices

Intellectual Property

Location

RELATED INSIGHTS​ 

June 4, 2024
Myanmar’s Patent Law 2019—the country’s first legislation specifically addressing patent protection—took effect on May 31, 2024. The announcement that the law had taken effect came when the State Administration Council (SAC) issued Notification No. 106/2024 on June 1, 2024. This announcement is a key development moving toward full implementation of statutory patent protection in Myanmar. The next step will be the announcement of the Patent Rules, which will establish the requirements, official forms, and procedures related to the application and registration of patents and utility models. Another necessary announcement will be the official forms and fees for proceeding with patent-related matters at the Intellectual Property Department (IPD). Upon these forthcoming announcements, parties will be able to apply for patent registration in Myanmar. The Patent Law, which was enacted in 2019, allows for the registration of inventions that: Have not been disclosed to the public anywhere by any means before the filing date or priority date (if claimed); Involve an inventive step; and Are capable of use in any industry. Priority rights can be claimed within a year of the filing of an application with any member country of the World Trade Organization. In seeking protection for inventions internationally, priority rights cannot yet be claimed under the Paris Convention or the Patent Cooperation Treaty, as Myanmar’s ratification of these agreements is still pending. Nevertheless, the Patent Law includes provisions related to these two agreements; these provisions will take effect if the ratification process is completed. Rights owners interested in seeking protection of their inventions in Myanmar should begin evaluating their portfolios so that they can apply to register their inventions once the remaining necessary announcements have been issued. Recordation of inventions—including renewals of patents that had been recognized under Myanmar’s previously established practice—will no longer be accepted. Rights holders can
Read More
May 28, 2024
On March 1, 2024, the Lao official gazette published the newly amended Law on Intellectual Property No. 50/NA, dated November 20, 2023 (the “2023 Law on IP”). The timing of this update is consistent with Laos’ history of providing regular revisions to the country’s IP legislation since the enactment of the first Law on Intellectual Property by the National Assembly in 2007 (the “2007 Law on IP”). These revisions include amendments in 2011, 2017, and now 2023. Prior to 2007, intellectual property (IP) protection was granted through decrees issued by the prime minister’s office for selected types of IP: trademarks, patents, petty patents, and industrial designs. The 2007 Law on IP marked a significant shift by introducing comprehensive legislation to protect industrial property rights, new plant varieties, copyright, and related rights. It laid the foundations for IP legislation in Laos, with the primary objectives of promoting and protecting intellectual creativity and attracting foreign investment. Since 2007, the enactment of new IP laws has not always entailed significant amendments to the existing IP framework; however, it frequently serves as an opportunity to introduce long-considered mechanisms. For example, the amended Law on Intellectual Property No. 38/NA, dated November 15, 2017 (“2017 Law on IP”) introduced, among other provisions, the possibility of opposition by a third party after the formal examination of a trademark application by the examiner. The 2023 Law on IP brought additional changes and updates to the IP regulatory landscape in Laos. Some of the most notable of these are highlighted below. Trademarks While Laos already introduced a new mechanism for online trademark registration in November 2023—about a month before enacting the 2023 Law on IP—the new law did introduce some noteworthy changes. Well-Known Marks The 2023 Law on IP appears to ease the burden of proof for establishing
Read More
May 16, 2024
On May 4, 2024, the Vietnamese government issued Decree No. 46/2024/ND-CP (“Decree 46”) amending and supplementing certain articles of Decree No. 99/2013/ND-CP dated August 29, 2013, on administrative sanctions in industrial property, as amended and supplemented in 2021 (“Decree 99”). Decree 46, which will come into force on July 1, 2024, is designed to bring Decree 99 in line with the amended IP Law of 2022. Some of the notable amendments of Decree 46 are discussed below. New Infringing Acts Decree 46 added the following new infringing acts subject to sanctions, which had not been set out in the former decree: Use of patents, utility solutions, layout designs, or industrial designs without paying compensation according to the provisions on temporary rights specified in Article 131 of the amended IP Law. Accepting a trademark license not in the form of a written contract in the case of using the licensed trademark on goods or packaging. Failure to notify clients of costs, charges, and fees related to procedures for establishing and protecting industrial property rights. Deceiving clients in the course of entering into and performing industrial property representative service contracts, but not to the extent of criminal prosecution, or forcing customers to enter into and perform industrial property representative service contracts. Although these acts are not common occurrences, it is nevertheless important to have clear regulations in order to ensure consistency with the amended IP Law and overcome difficulties and obstacles if such acts are committed in practice. Amendments and Supplements Decree 46 adopted amendments and supplements to main sanctions, additional sanctions, and remedial measures, specifically: The monetary fine imposed for violations against trade secrets is VND 50 million to VND 100 million (approx. USD 2,000 – USD 4,000), a large increase compared to the VND 5 million to VND 15
Read More
May 2, 2024
On May 1, 2024, Myanmar’s Intellectual Property Department (IPD) issued its first publication of trademark applications under the country’s 2019 Trademark Law. Parties are now able to oppose any of the applied-for marks in the publication, which is accessible from the IPD’s website, in accordance with stipulations of Myanmar law. This is a substantial development showing progress toward the registration of marks under the Trademark Law. The online publication of the applications provides the details of each mark, applicant, and representative. In addition, it discloses relevant information such as disclaimers, color claims, mark translations or transliterations, applicable priority dates, as well as specifications of goods and services under the Nice Classification. Any person (individual or legal entity) can file an opposition against an applied-for mark within 60 days of publication by citing significant absolute or relative grounds as specified in the relevant sections of the Trademark Law. Oppositions must use the official form specified in the Trademark Rules, and the filing fee is MMK 150,000 per mark (regardless of the number of classes) plus a MMK 300 bank charge. Anyone, including interested parties or their local representatives, can file the opposition at the IPD. If an opposition is not filed within the stipulated 60-day period, the IPD will proceed with the trademark registration without conducting any substantive examination for similarity or priority. Thus, mark owners, rights holders, and other interested parties should closely monitor the IPD’s publication of applied-for marks so they can take any necessary actions and potentially file oppositions to protect their rights and interests. There has not yet been any official announcement on how often these publications will be issued. For more information on the IPD’s mark publication activities, or on any aspect of protecting intellectual property in Myanmar, please contact Tilleke & Gibbins at [email protected].
Read More