Indonesian Patent Law working requirements repealed

Indonesia’s Omnibus law on job creation adds several patent rules. The law mainly focuses on economic reforms to help foreign investment and job creation and has created some concerns over workers rights. 

However an amendment to the Patent Law working requirements has been added into it, following foreign IP owner lobbying over the last year. See here for previous details. Article 20 of the Patent Law contains the controversial working requirements. These require patent holders to manufacture a patented product or use the patented process in Indonesia within 3 years of grant or face compulsory license or cancellation of patents. This has now been revoked by the Omnibus Law.  

A new Article 20 has been added to the Patent Law. Instead of an obligation to make a product or to use the process in Indonesia, now a patent can be implemented in Indonesia in one of the following ways:  

a for product patents - making, importing, or licensing a patented product; 

b. for process patents - making, licensing, or importing products resulting from that patented process; 

c. for method patents - making, importing, or licensing products resulting from the patented method, system and use. 

The risk of compulsory licensing or revocation now only applies to failure to do one of the acts above.  

Previously a system had been used for patent owners to apply for delays to work their patents. This is expected to cease; since it was mainly expected to be used by those who license or import products (which was not working a patent previously). 

The final draft law has not been signed by the President yet. Once it is patent owners should review their patent implementation in Indonesia. Working a patent now has a wider definition, and there is a 3 year period to do that.  But patents that are not used or worked at all may still be vulnerable. 

A second Patent amendment has included in the Omnibus Law. It law also provides more clarification in relation to simple patents. An additional patentability requirement is added, namely the invention has a practical use. Secondly the examination process has been simplified. 

Patents are often seen as critical investment issues so the government hopes these amendments will ameliorate foreign investor relations.