Indonesia remained on the Priority Watch List in the 2023 Special 301 Report. U.S. right holders continue to face challenges in Indonesia with respect to adequate and effective intellectual property (IP) protection and enforcement, as well as fair and equitable market access. Concerns include widespread piracy and counterfeiting and, in particular, the lack of enforcement against dangerous counterfeit products. To address these issues, Indonesia would need to develop and fully fund a robust and coordinated IP enforcement effort that includes deterrent-level penalties for IP infringement in physical markets and online. Indonesia’s 2016 Patent Law continues to raise concerns, including with respect to the patentability criteria for incremental innovations, the grounds and procedures for issuing compulsory licenses, and the disclosure requirements for inventions related to traditional knowledge and genetic resources.
Indonesia’s law concerning geographical indications (GIs) raises questions about the effect of new GI registrations on pre-existing trademark rights and the ability to use common food names. Indonesia also lacks an effective system for protecting against the unfair commercial use, as well as unauthorized disclosure, of undisclosed test or other data generated to obtain marketing approval for pharmaceutical and agricultural chemical products. Online piracy is a concern, particularly through piracy devices and applications, and illegal video recordings and unlicensed use of software remain problematic. In addition, the United States remains concerned about a range of market access barriers in Indonesia, including certain measures related to motion pictures and requirements for domestic manufacturing and technology transfer for pharmaceuticals and other sectors.
Indonesia has made progress in addressing some of these concerns but has faltered or taken steps backward in other areas. In January 2021, the Ministry of Law and Human Rights (MLHR) issued Regulation 14/2021, to amend Regulation 20/2019, which establishes procedures for compulsory licenses and addresses a number of concerns included in the previous compulsory licensing regulation, Regulation 39/2018.
U.S. stakeholders have also noted positive developments related to Indonesia’s efforts to address online piracy, such as increased enforcement efforts by the Ministry of Communications and Information Technology and its support of industry-led efforts to develop an Infringing Website List to help advertising brokers and networks avoid placing advertisements on listed websites.
In recent years, the Ministry of Finance has issued regulations clarifying its ex officio authority for border enforcement against pirated and counterfeit goods and instituted a recordation system; however, concerns remain regarding the ability of foreign right holders to benefit from the system. Although Indonesia took steps in 2016 to allow 100% foreign direct investment in the production of films and sound recordings, as well as in film distribution and exhibition, Indonesia has issued implementing regulations to the 2009 Film Law that, if enforced, would further restrict foreign participation in this sector. Specifically, Ministry of Education and Culture Regulation 34/2019 includes screen quotas and a dubbing ban for foreign films.
In any foreign market, companies should consider several general principles for effective protection of their intellectual property. For background, link to our article on Protecting Intellectual Property and Stopfakes.gov for more resources.
For more information, contact ITA’s Office of Standards and Intellectual Property Rights (OSIP) Director, Stevan Mitchell at Stevan.Mitchell@trade.gov.
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