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Thursday, February 20, 2014

Trademark rules from outside Indonesia'sTM office

Indonesia's trademark law is a 'special law' that is it overrides normal civil law rules by making special rules to deal with that subject matter. However recently a number of encroachments on trademark jurisprudence have been made by other Ministries that seem to be setting a worrying precedent. 
 
It began a year ago when the Ministry of Health established rules on what 'descriptors' could be used on tobacco products (see here). These aimed to prevent the use of misleading or promotional terms that could make consumers think tobacco products are safe, or healthy, or terms which encourage smoking. "LIGHTS" and other prohibited examples are given. This is in line with anti-smoking initiatives elsewhere.
 
However the rules made an unusual exception, which is that certain of the prohibited descriptors which are registered as trademarks are permitted. This means that many of the prohibited terms are in fact allowed if they are registered first. This is because of an unusual situation namely that the term MILD has been adopted as part of the white cigarette brands of many of the local kretek, clove cigarette makers. So they lobbied to allow an exception.  Apart from the now impossible task if working out what is or is not prohibited, the rules were drafted without considering trademark laws. As such it requires a registration, which takes 3 years in Indonesia to obtain. Now cigarette companies have no idea what the requirements are and whether they are at risk if they have only an application.
 
The second example is a Ministry of Industry regulation implementing the Indonesian National Standard (SNI) for toys. Imported toy products. They must comply with the SNI by having Product Certificate for the SNI. This must be obtained directly by the manufacturer and requires....yes a trademark certificate or licensing agreement registered at the TMO. In theory this again means that the trademark must be registered, and so given 3 year pendency, toy importers can potentially no longer import the latest products. Besides, the TMO is not accepting licenses for recordable as there is no TMO regulation on this.
 
These instances may just be poor input on the regulations from the TMO, or a lack of coordination/consultation with them. The net result is serious business uncertainty for IP owners.  The idea of other ministries making trademark regulations up, also detracts from function of the Trademark law as a special law governing all trademark rules. 

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