Trademark Enforcement Proceedings
Q: What types of legal or administrative proceedings are available to enforce the rights of a Trademark Owner against an alleged infringer or dilutive use of a mark, apart from previously discussed opposition and cancellation actions? Are there specialised courts or other tribunals? Is there any provision in the criminal law regarding Trademark Infringement or an equivalent offence?
A: There are several approaches that need to be considered when commencing the Trademark enforcement proceedings. It is always a prudent course of action to start with sending a cease and desist letter against the infringer to immediately cease the infringing action. Should the infringer does not comply with the requests that have been addressed in the cease and desist letter, then the Trademark Owner has the option to file a criminal action against the infringer to the civil investigator at the Directorate General of Intellectual Property (DGIP) or to the Indonesian Police.
All Intellectual Property disputes are the domain of the Court of Commerce. Apart from invalidations and cancellations of registered marks, any party with legal rights can also seek civil actions through the Court of Commerce, namely to request preliminary injunction and to seek for damages or remedies.
The penalties for infringements are covered by the Trademark Law, namely the following articles:
CHAPTER XVIII
CRIMINAL PROVISIONS
Article 100
(1) Every person unlawfully uses any Mark which is identical to registered Mark of other parties for similarly produced, and/or traded goods and/or services, shall be sentenced to imprisonment of up to 5 (five) years and/or fines up to Rp2,000,000,000.00 (two billion rupiahs).
(2) Every person unlawfully uses any Mark which is substantially similar to registered Mark of another party for similarly produced and/or traded goods and/or services, shall be sentenced to imprisonment for up to 4 (four) years and/or fines up to Rp2,000,000,000.00 (two billion rupiahs).
(3) Every person violating the provisions as referred to in section (1) and section (2), whose goods cause health impairment, environment distortion, and/or human deceases, shall be sentenced to an imprisonment up to (10) ten years and/or fines up to Rp5.000.000.000,00 (five billion rupiahs).
Article 101
(1) Every person unlawfully uses any signs which are identical to Geographical Indications of other parties for similar goods and/or products or identical to registered goods and/or products, shall be sentenced to imprisonment up to 4 (four) years and/or up to Rp2.000.000.000,00 (two billion rupiahs).
(2) Every Person unlawfully uses any sign which is substantially similar to Geographical Indications of another party for similar goods and/or products or identical with registered goods and/or products, shall be sentenced with imprisonment up to 4 (four) years and/or :nes up to Rp2.000.000.000,00 (two billion rupiahs).
Article 102
Every Person who trades goods and/or services and/or product which is known or allegedly know that the goods and/or services and/or product constitute criminal acts as referred to in Article 100 and Article 101 shall be sentenced with imprisonment up to 1 (one) year or fines up to Rp200.000.000,00 (two hundred million rupiahs).
Article 103
The criminal acts as referred to in article 100 to article 102 constitute complaint delict.
Procedural Format and Timing
Q: What is the format of the infringement proceeding?
A: Civil proceedings in Indonesia are conducted in writing and oral arguments. The judges will listen to the oral arguments of each party one at a time, and they rely heavily on documentary evidence. Witnesses of fact can also provide oral evidence before the court. However, a witness statement or affidavit alone will not be sufficient since it is considered merely supplementary documentary evidence. In general, the procedure of the trial is as follows:
- attendance at the first hearing after the court summons both plaintiff and defendant;
- attendance at the second hearing, when the defendant files its response to the plaintiff’s cancellation suit;
- preparation of the plaintiff’s reply to the defendant’s response to the suit;
- attendance at the third hearing to file the plaintiff’s reply;
- attendance at the fourth hearing when the defendant files its response to the plaintiff’s reply;
- preparation of the plaintiff’s evidence to be submitted to the court;
- attendance at the fifth hearing to submit the plaintiff’s evidence and review the defendant’s evidence;
- preparation and filing of the conclusion of the case based on documents and evidence filed with the court by both plaintiff and defendant;
- attendance at the sixth hearing on the filing of the conclusion of the case;
- attendance at the seventh hearing to hear the judge’s decision; and
- issuance of the court’s decision.
For civil procedure, in theory a decision shall be issued within three months. However, in practice, it may take slightly longer due to the extensions requested by any of the parties involved.
Burden of Proof
Q: What is the burden of proof to establish infringement or dilution?
A: In Indonesian civil procedure, the burden of proof regarding the facts on which a claim is based lies with the plaintiff. Article 1865 of the Indonesian Civil Code states that anyone who claims to have a certain right or who refers to a fact to support such a right, or who obzects to another party’s right, must prove the existence of that right or that fact. Evidence may comprise written evidence, evidence presented by witnesses, or through inference, confession or oath. In our experience, it is prudent to collect as much diverse evidential material as possible, such as purchases made by mystery shoppers, marketing materials found online and offline, and expert witnesses that may provide substantive statements pertaining to the alleged infringement. Furthermore, written evidence must be presented in the Indonesian language – translated by a sworn translator if necessary.
Standing
Q: Who may seek a remedy for an alleged Trademark violation and under what conditions? Who has standing to bring a criminal complaint?
A: In accordance with article 83 of the Trademark Law, the registered mark owner and/or its licensee may file a lawsuit against other parties who unlawfully use the mark that is similar to or identical for similar kinds of goods or services in the form of:
- claim for damages; and/or
- ceasing all acts related to the use of marks.
The lawsuit may also be filed by the owner of a well-known mark based on a court decision.
When it comes to criminal actions, ideally it is the Trademark owner who shall file the complaint. However, under certain circumstances, the authorised licensee can also file a criminal complaint upon the instruction and authorisation of the Trademark Owner.
Border Enforcement and Foreign Activities
Q: What border enforcement measures are available to halt the import and export of infringing goods? Can activities that take place outside the country of registration support a charge of infringement or dilution?
A: If the Trademark Owner has a company domiciled in Indonesia, then it can record its Trademark before the Customs. See the full information below:
| Time needed for recordal process | 30 working days, but it may take longer |
| Duration of recordal once it is approved | One year and can be renewed |
| Documents needed for recordal, please indicate if notarisation or legalisation is necessary |
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| Please confirm amount of time we have to authenticate once a notice of provisional seizure is made | Two days only – hence the importance of having the Indonesia-based product experts. |
| Please confirm the seizure process and punishment issued in customs seizures | Please note that Trademark Holders should have address in Indonesia. Otherwise, it is currently not possible to file a recordation with Customs. Assuming the recordation has been approved and Customs notifies the proprietor of the mark, the proprietor of the mark only has two days to confirm interested in filing a temporary injunction needed to withhold the cargo for 10 days (can be extended once). They also need to pay a bond of bank guarantee or guarantee from insurance company least 100 million rupiah. |
Bonds
There are two main regulations governing Customs Recordal in the country, namely Government Regulation No. 20/2017 and the lex specialis of it is Ministry of Finance Regulation No. 40/PMK.04/2018 on Recordal, Seizure, Collateral, Temporary Suspension, Monitoring and Evaluation on the Import and Export of Goods Suspected or Resulted from IP Infringements.
The latter states that the bond of 100 million rupiah should be provided in the form of a bank or insurance company guarantee. The bond should be provided once the IP owner responds to the notification by Customs about the cargo hold-up at the port within four days of providing the response. At the same time, the IP owner should request a temporary suspension to the court within the same time frame should they wish to carry on with the suspension and examination of the cargo.
The bond is aimed to cover the operational costs of the Customs and to bear the costs claimed by the importers or exporters in case the cargo does not contain any infringing goods. The validity of the bond should be at least 60 days.
If the mark owner does not meet the minimum requirements to record its Trademarks before Customs, then it can always request an injunction at the Court of Commerce to temporarily halt the infringing activities.
Discovery
Q: What discovery or disclosure devices are permitted for obtaining evidence from an adverse partiy, from third parties, or from parties outside the country?
A: There is no discovery process in Indonesian legal practice and parties do not have a right to demand the submission of documents.
Timing
Q: What is the typical time frame for an infringement or dilution, or related action, at the preliminary injunction and trial levels, and on appeal?
A: Note that by law the Court of Commerce must issue its decision within 90 days of the date of filing of the suit for Trademark matters. However, for criminal actions the process may take longer – sometimes from three to nine months if the documents are complete.
Limitation Period
Q: What is the limitation period for filing an infringement action?
A: In accordance to article 78 or the Indonesian Penal Code, the right to prosecute shall lapse by lapse of time:
- in one year for all misdemeanours and for the crimes committed by means of the press;
- in six years for the crimes upon which fine, custody or imprisonment of not more than three years is imposed;
- in 12 years for all crimes upon which temporary imprisonment for more than three years is imposed; and
- in 18 years for all crimes upon which capital punishment or life imprisonment is imposed.
Litigation Costs
Q: What is the typical range of costs associated with an infringement or dilution action, including trial preparation, trial and appeal?
A: Not applicable
Appeals
Q: What avenues of appeal are available?
A: The Supreme Court facilitates cassation based on the issuance of the lower court (ie, the Court of Commerce).
Defences
Q: What defences are available to a charge of infringement or dilution, or any related action?
A: There are several matters to consider when facing an infringement or dillution suit. The most important is to verify if the plaintiff has used the mark continuously for five years from the date of last use or from the date of registration. If that is not the case, then we can file for a non-use cancellation action as a counter-attack measure.
However, if we face a blatant charge for an infringement that is very identical in nature, then it is best to seek settlement out of court to avoid maximum penalties by the Court of Commerce.
Remedies
Q: What remedies are available to a successful party in an action for infringement or dilution, etc? What criminal remedies exist?
A: All laws pertaining to Intellectual Property assets allow the infringed to seek damages through the Court of Commerce. However, there is no known formula for determining the damages to be awarded. The compensation shall be given based on a final and binding decision of a civil or criminal court. Note that attorney’s fees shall be borne by the party that receives legal service from the entrusted attorney. Hence, it will not be possible to seek compensation from the other party for the legal fees already incurred by the claimant or plaintiff.
With regard to injunctions, the Trademark Law allows the rights holder to request a provisional injunction to stop the circulation of infringing articles, as well as to secure or collect them, and to avoid greater losses. Provisional injunctions may be useful to perform their intended purpose to the extent that they can limit the ability to record a patent registration with Indonesian Customs. To achieve this, the provisional injunction has to be served to Indonesian Customs to stop the influx of suspected infringing articles into the distribution channels.
Alternative Dispute Resolution (ADR)
Q: Are ADR techniques available, commonly used and enforceable? What are the benefits and risks?
A: Indonesia is blessed to have various options when it comes to ADR that are enforceable and proven in practice. The Intellectual Property Rights Mediation Arbitration Body (BAMHKI) is an IP-specific arbitration venue in the country. Other arbitration options are also available, such as through the Indonesian National Arbitration Body (BANI). Arbitration is the best option for obtaining a final and binding decision but can be resolved in a short time. In fact, the arbitral award must be made voluntarily by the parties. However, in the event that the losing party is reluctant to implement the arbitration award, the court can still be asked to execute the decision.
Should you need more information regarding the Trademark Enforcement in Indonesia, please do not hesitate to contact us via [email protected].
