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November 25, 2020

Indonesia’s Omnibus Law Amends the Patent Law and the Trademark Law to Support Foreign Investment

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Indonesia’s long-deliberated Omnibus Law (Law No. 11 of 2020) was enacted on November 2, 2020, implementing a number of amendments to Indonesia’s intellectual property laws. The law is intended to aid foreign investment. The changes pertaining to intellectual property law include reducing the time required for prosecution of simple patents, providing greater flexibility in regard to the working requirement for patents, and making some practical administrative amendments to the trademark law. These are summarize below.

Patent Law

The Omnibus Law’s amendments to the Patent Law pertain to the following three areas:

Simple patents

The amended law slightly updates and clarifies Indonesian law’s treatment of simple patents, which are now defined as simple patents granted for new inventions, improvements to existing products, with practical uses and industrial applications. The language stipulating “practical uses” is new, though it is still too early to know how this additional language might affect the decision-making process for granting patents. In addition, “improvements to existing products” is now explicitly defined to include simple products, simple processes, and simple methods.

Simple patent applications must now be published within 14 days from the filing date, with a shortened publication period of 14 working days. Substantive examination must be requested at the time of filing the application, and any opposition to the simple patent application will be considered during the substantive examination stage. Finally, the decision to grant or refuse a simple patent will be issued no later than six months from the application filing date.

Working requirement

The working requirement (i.e., the requirement that the owner of a patent implement the patented innovation in Indonesia) has been broadened. Patent implementation now includes making, importing, and licensing the patented product, process, method, system, or usage. Previously, this provision only mentioned producing the products or using the process in Indonesia. This meant that a foreign patent holder would have needed to have a manufacturing facility in Indonesia in order to meet this requirement, or risk the patent becoming vulnerable to compulsory licensing or cancellation.

Patent holders are still allowed to request postponement of the patent implementation requirement if necessary.

Compulsory licensing

Article 82 on compulsory licensing has been amended to complement the amendments of the working requirement, making it possible for patent holders to avoid compulsory licensing if they import or license the patented product, process, or method.

Trademark Law

The Omnibus Law also makes a few amendments to the Trademark Law:

  • The law’s list of marks that are not registrable now includes marks containing a functional form.
  • To speed up the prosecution process, substantive examination will now be carried out as soon as the publication period ends, and will be completed within 30 days, if there is no opposition; or within 90 days if an opposition has been filed.
  • The amended law no longer mentions collection of the certificate, since all certificates are issued as e-certificates.

Implementation

While it remains to be seen whether the implementation of the amendments related to timing will expedite trademark and patent prosecution times in line with the stipulated durations, the changes are a good indication of the government’s intentions and goals. Other amendments—most notably the broadening of the patent working requirement—should be relatively straightforward to implement and are likely to achieve the Omnibus Law’s goal of aiding foreign investment.

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