In the age of globalization, prominent brands play a crucial role in shaping customer identity and trust while enhancing product competitiveness in the global market. This paper examines the legal safeguarding of renowned trademarks in Indonesia, grounded in the principle of good faith as outlined in Law Number 20 of 2016 about Trademarks and Geographical Indications. This study employs normative juridical research methodologies to examine the preventative and repressive legal protection of renowned trademarks, alongside the implementation of the concept of good faith in trademark registration and utilization. The results show that although regulations have adopted protections for well-known brands, their implementation still faces various challenges, such as weak oversight and lack of legal certainty, which have the potential to harm rights holders and consumers. Therefore, to create effective and fair brand protection, the legal system must be strengthened by establishing a database of well-known brands, accelerating legal processes, educating the public, and collaborating across sectors.
The fact is that humans in this universe are endowed with unlimited knowledge of certain things, so that in a rapid development like today, human thought is one of the results of free, creative, and innovative resources. This is better known as Intellectual Property Rights (IPR). The work of this intellectual property is extensive, including the brand
In intellectual property rights, a trademark must satisfy several criteria to be acknowledged as a well-known trademark. The criteria for a reputable brand are determined not only by its appeal but also by its influence and impact within the neighborhood market. The definition of intellectual property rights is a system integral to contemporary living. Intellectual property rights, henceforth denoted as IPR, emerge from cognitive endeavors that yield products advantageous to humanity. Intellectual Property Rights (IPR) can also be construed as a privilege granted to an individual for creating something beneficial to others. Prominent brands in Indonesia typically own substantial market share, are widely recognized by the public, and exhibit elevated brand value. The ownership of this trademark plays a crucial role in advertising and marketing, as it pertains to the image, quality, and reputation of goods or services associated with a specific brand, hence transforming the brand into commercial value
Numerous prominent brands in Indonesia have effectively entered both domestic and international markets. The competitiveness and quality of local products serve as a model for other local entrepreneurs to develop and compete in the global market. Prominent brands in Indonesia contribute to elevating the perception of local products globally and fostering national identity. The Trademark Office must refuse the registration of a trademark that bears similarities to a well-known brand, either in principle or wholly, as establishing a brand necessitates creativity, time, and financial resources. Consequently, individuals who have exerted effort to register a trademark must obtain protection
The standing of a brand in the commercial sphere necessitates brand protection. Assume the company's brand is well-recognized throughout the neighborhood. This situation facilitates the rise of unscrupulous competitors who engage in piracy, trademark replication, or counterfeiting to achieve rapid financial gain. Trademark protection is governed by the regulations outlined in Law Number 20 of 2016 on Trademarks and Geographical Indications. The trademark proprietor must register the trademark with the Directorate General of Intellectual Property Rights to secure exclusive usage rights, allowing other entities to utilize it for a specified duration while receiving legal protection from
the state (Law Number 20 of 2016 concerning Trademarks and Geographical Indications, Article 1 Paragraph (2).
The classification of well-known trademarks is often debated based on their varied dynamics that contain several elements, such as consumer acceptance, advertising of their use, and especially the extent of the territory in which the mark will be used. The Trademarks and Geographical Indications Act provisions have not fully resolved this issue, thus creating the possibility of such disputes in practice at the national and international levels. In addition, the legal protection of well-known trademarks needs further attention from various stakeholders. This includes suppressing rights violations, granting those rights first, and taking action against violators. With the increasing adoption of the concept of e-commerce and the internationalization of trade, the legal protection system provided to well-known brand owners must find the right balance between private and public interests and improve the position of such owners in international competition
Consequently, it is essential to conduct further research on the legal protection of renowned trademarks grounded in the principle of good faith and to examine how the enforcement of this legal protection is predicated on the same principle
The author aims to examine the problem formulation addressed in this study, specifically the legal protection of renowned trademarks in Indonesia and the implementation of the law concerning these brands, grounded in the principle of good faith. This research aims to provide a comprehensive analysis of the application of law concerning prominent brands in Indonesia, focusing on measures to maintain equity and avoid the exploitation of trademarks by malicious entities. This subject is pertinent since it pertains to safeguarding intellectual property rights, which is essential for fostering robust commercial rivalry.
Famous brands have great appeal, can exude an impression of exclusivity, and are often associated with a luxurious lifestyle. When a well-known brand is seen, many people feel compelled to use or own its products. Using products from well-known brands is also often a symbol of social status, indicating that the wearer comes from the upper middle class or the socialite community group
Numerous international treaties safeguard renowned trademarks, including the Paris Convention for the Protection of Industrial Property and the Agreement on Trade-Related Aspects of Intellectual Property Rights.
The Paris Convention and the TRIPS Agreement mandate that member governments safeguard renowned trademarks, regardless of their registration or usage within that jurisdiction. Protection for renowned trademarks not registered under the Paris Convention is typically confined to goods and services that are identical or analogous to associated brand offerings, particularly in circumstances where usage may induce confusion
However, Indonesia has no clear definition or criteria for what a "famous brand" means. This can be seen in Law Number 20 of 2016 concerning trademarks and geographical indications, which does not explicitly formulate well-known brands. Freddy Haris, the former head of the Directorate of Intellectual Property (DJKI), stated that there has been no official determination on the definition of a well-known brand.
Article 21, Paragraph (1), Letters b and c of the Trademark Law stipulate that applications for trademark registration may be denied if the trademark is similar to or identical with another well-known trademark. This evaluation also considers the brand's repute, evidenced by extensive advertisements, international investments by the proprietors, and registration verification in many countries.
Famous brands are usually closely associated with products officially traded and widely recognized in the market, including Indonesia. The wider community often consumes Products from well-known brands, especially by groups with high purchasing power. For the upper middle class, products from well-known brands are not only consumer goods, but also part of lifestyle needs that reflect their identity and social status
Brands embody businesses' commitments to consistently deliver specific attributes, advantages, and services to consumers. Besides representing economic identity, brands possess pricing structures that incentivize commercial entities to compete and gain popularity among the public.
Imitating unregistered well-known brands in Indonesia constitutes fraudulent behavior or bad faith in trademark registration. Legal regulations govern the safeguarding of renowned brands not registered in Indonesia, ensuring the application of the principle of good faith to prevent detriment to
trademark rights holders and to protect consumers from acquiring counterfeit branded products
Good faith is a crucial element in contract law and the execution of agreements, grounded on propriety and decency
Bad faith in trademark registration is delineated in Law Number 20 of 2016 concerning Trademarks and Geographical Indications, specifically in Article 21, paragraph (3), which states: "The application is rejected if submitted by the Applicant in bad faith" (Law of the Republic of Indonesia Number 20 of 2016 regarding Trademarks and Geographical Indications).
This indicates that business entities associated with trademark registration want to plagiarize, emulate, or replicate another party's brand for their commercial advantage. This misleads and deceives consumers, adversely affecting established brands and leading to unfair market competition.
A fundamental premise pertinent to trademark registration is the necessity of good faith. Good faith is generally defined in Article 1338, paragraph
(3) of the BW (Burgerlijk Wetboek), which states, "the parties are obliged to act reasonably and appropriately." The doctrine of good faith is a foundational tenet in trademark law, encompassing safeguarding renowned brands. The foundation of good faith pertains to sincere intentions that do not violate legal statutes, ethical standards, or the interests of other parties
Indonesia's trademark protection system operates on a first-to-file basis, a
practice prevalent in nations with civil law legal frameworks. Trademark proprietors, including prominent brands, must register their trademarks with the Directorate General of Intellectual Property Rights to secure exclusive rights and legal protection. Exclusive rights are conferred not solely based on initial proof of use, but rather to the entity that first applied for registration
This study uses normative legal thinking to acquire data, encompassing multiple facets, including the conceptual, legislative, case, and comparative approaches.
The study of normative law is concerned with the rule of law and its principles, both in the rules and the external legal system, the degree of coherence of the established thresholds, the scope of the regulations studied by the community, and the legal history. This approach is not only concerned with positive law (ius constitutum), which is based on the current law to provide certainty and the need for conflict resolution, but also the social concept of justice, ius constituendum.
The legal system plays a crucial role in safeguarding society against the detrimental effects of inequitable corporate rivalry.
The main goal is to ensure that the public has access to useful products in accordance with applicable regulations. Philipus M Hadjon's theory of legal protection includes two main aspects: preventive legal protection aimed at preventing violations or disputes through mechanisms such as the registration of well-known trademarks and applicable legal regulations. Meanwhile, repressive legal protection is applied after an infringement occurs, for example, through a lawsuit for trademark infringement or trademark cancellation by a third party.
By creating interesting ideas in marketing, brands become more lively and can capture consumers' attention. On the other hand, business actors who understand the rules of the law will usually register their products to get legal protection for the brand. This registration aims to protect the brand from use by other parties and prevent product imitation. This process certainly requires considerable time, effort, and cost as part of the efforts and sacrifices in maintaining the brand
Regrettably, these provisions remain insufficiently explicit. The Commercial Court may designate an independent entity to assess whether a trademark qualifies as well-known. The ambiguity in definitions and qualifications leads to disputes in which prominent brands outperform local brands in Indonesia. The criteria for a renowned trademark, as stipulated in the Regulation of the Minister of Law and Human Rights Number 67 of 2016 Article 16 paragraph (2) letters b and c, and Article 21 paragraph (1) letters b and c of the UUMIG, are established by evaluating the degree of public recognition of the trademark within the relevant business sector.
Here are some examples of cases that illustrate the lack of clear protection for well-known brands in Indonesia:
Ikea Sweden vs Ikea Indonesia ( PT. Equatorial Ratania)
Lexus vs Prolexus Local
Pierre Cardin vs Pierre Cardin Local
Based on these issues, the legal protection of prominent brands in Indonesia remains inadequate and uneven. The elucidation of Article 21, Paragraph 1, letters b and c fails to offer sufficient legal clarity, resulting in ongoing disputes between the proprietors of renowned brands and local brands during the registration procedure in Indonesia.
Legal protection for trademarks is exclusively afforded to registered trademarks. Trademark registration offers enhanced protection, particularly for brands with resemblances. However, most business actors understand the importance of using a trademark to differentiate their products from competitors; not all realize the importance of registering a trademark as a protective measure
Trademark registration is a proactive strategy to safeguard marketed items. The Directorate General of Intellectual Property (Ditjen KI) is the official body responsible for registering trademarks based on applications from trademark proprietors.
Legal protection should protect people who are harmed by unfair business competition. This protection enables the public to take advantage of valuable products under applicable regulations. In principle, legal protection is a step provided by the state to create justice, both in the intellectual aspect and in the face of interference from parties who seek to use specific brands for bad purposes. These actions are detrimental to business actors and society in general
In Indonesia, the legal protection of renowned trademarks is essential for preserving their distinctiveness and prestige. Article 35 of Law Number 20 of 2016 governs the assessment of Trademarks and Geographical Indications, offering legal protection for trademarks for 10 years, with the possibility of extension, ensuring a substantial period of security for brand proprietors. The first registration procedure implemented in Indonesia conferred exclusive rights to the first entity to register a trademark, necessitating that the trademark owner register their trademark to obtain legal protection.
Registration must be conducted in good faith to avert abuse or unfair competition, as mandated by Articles 20 and 21 of the Trademark and Geographical Indications Act. In this instance, business entities that do not actively utilize the trademark must adhere to the trademark cancellation procedure outlined in Article 74 of the MIG Law if the trademark has not been employed in commerce for three consecutive years.
We also believe that the application of sanctions against infringement of a well-known trademark must be practical, which can be cancelled or amended by the Minister in Article 92 of the MIG Law, which contains provisions on who can confirm or cancel the trademark registration. This is very important because it puts more weight on good practices and the success of well-known brands.
Although legal protection for well-known trademarks in Indonesia is already robust, it requires thorough examination to enable businesses to optimize the trademark registration system and mitigate the risk of infringement. Consequently, this not only advantages the brand proprietor but also safeguards consumers' knowledge of the quality and originality of the things they utilize.
The notion of good faith is crucial in Indonesia's trademark legal framework, particularly in mitigating abuse and safeguarding renowned brands.
The scope of the implementation includes the following aspects:
1. Trademark Registration (Article 21 of the Trademark and Geographical Indication Act)
Registration Requirements in Good Faith: A trademark must be registered with the sincere intention of legitimate use in the commerce of goods or services.
Registration should not be conducted to inhibit the proprietor of a renowned brand from securing his trademark.
Trademark Rejection Not Founded on Good Faith: An application for registration may be denied if the proposed trademark possesses: Resemblance to established brands, even though the established brand is not registered in Indonesia (Article 21, paragraph 1, letter b of the Trademark Law). Where to exploit the reputation of a renowned brand (malicious registration).
2. Employment of Trademarks in Commercial Activities. The legitimate utilization of a renowned trademark by an unauthorized party necessitates the consent (license) of the trademark proprietor. The prohibition against counterfeiting and imitating the trademark, when employing a well-known trademark without a license to bolster reputation or mislead consumers, contravenes the principle of good faith and is liable to criminal penalties (Articles 100-102 of the Trademark Law)
3. Protection of Unregistered Famous Trademarks: The safeguarding of renowned trademarks that lack registration remains effective if the trademark fulfills the criteria of a well-known trademark based on global reputation, utilization across multiple countries, and public recognition (Article 21, paragraph 1, letter b of the Trademark Law). Furthermore, the prevention of registration by a third party is mandated, prohibiting the registration of a well-known trademark without consent and with malicious intent, such as to resell brand rights or undermine the brand owner.
4. A well-known brand can initiate trademark cancellation litigation against a registered trademark in good faith if the contested trademark resembles the brand and is utilized for the sale of counterfeit goods. Violations of well-known trademarks committed in bad faith may incur criminal penalties, including fines or imprisonment, as stipulated in Articles 100- 102 of the Trademark Law.
5. Aspect International, Indonesia, as a signatory to the Paris Convention and the TRIPS Agreement, is mandated to safeguard well-known trademarks, whether registered or unregistered, from registration and utilization in bad faith.
6. Prevention of Unfair Business Competition: Using a well-known brand's reputation in registering a trademark that resembles a well-known brand to damage its reputation or divert consumers violates the principle of good faith.
Law Number 20 of 2016 governs the safeguarding of renowned trademarks concerning Trademarks and Geographical Indications (Trademark Law). Establishes a legal framework to safeguard the rights of prominent trademark holders, both against unauthorized registration by third parties lacking good faith and against illicit usage. The execution is observed under the legal framework safeguarding renowned trademarks. Article 1, Paragraph 1: "A trademark is defined as a mark that can be graphically represented to differentiate goods or services in commercial activities." Article 21, paragraph (1), letter b: "Trademark registration may be denied if it resembles a well-known trademark owned by another entity, applicable to both similar and dissimilar goods/services, particularly if the registration is executed in bad faith." Article 83, paragraph (1): "The proprietor of a renowned trademark is entitled to initiate legal action against parties that utilize or register their trademarks without authorization."
The government also provides a mechanism to resolve disputes through civil lawsuits, criminal reporting, or mediation.
The owner of a well-known brand has privileges such as:
Right to Exclusivity: Owners of renowned trademarks are entitled to utilize their trademarks for products or services that align with the registered categorization. In the realm of established brands, the right of exclusivity encompasses safeguarding distinct goods/services that may evoke associations.
The Right to Prohibit Other Parties: The proprietor of a renowned trademark can prevent another entity from utilizing an identical or similar trademark without authorization. This protection is designed to avert customer confusion and the misappropriation of a renowned brand's reputation.
Right to Sue: Holders of well-known trademarks may initiate legal proceedings in the commercial court in instances of infringement, including bad faith trademark registration or unlawful usage.
Entitlement to International Protection Indonesia, being a signatory to the Paris Convention and the TRIPS Agreement, ensures the protection of renowned trademarks, regardless of local registration.
In general, or seen from the law and regulations, implementing the law against well-known brands in Indonesia is under existing regulations, but the implementation is not optimal. In the implementation in the field, there are still many obstacles, there are many causes of implementation that are not under the existing regulations in Indonesia such as a lot of famous brands that want to enter Indonesia but lose to local brands because there is no database, Indonesia does adhere to first to file those who register first are those who get exclusive rights and Indonesia also adheres to the Paris Convention and TRIPS AGREEMENT where famous brands that Registered or unregistered have the same legal
protection. Therefore, Indonesia lacks the implementation of internal protection for well-known brands.
Efforts that must be made on the implementation gap for well-known brands include the government creating a database for DJKI, and there needs to be a revision of the law to protect well-known brands in Indonesia. By accelerating the legal process in developing a faster and more transparent judicial system, increasing publicity in strengthening cooperation between the government, police, and e-commerce platforms to reduce the circulation of counterfeit products, public education in national campaigns to raise public awareness about the importance of respecting trademark rights, ease of access for brand owners in providing more affordable legal services to help brand owners protect rights (Implementation of Legal Protection for Famous Trademarks from Acts of Infringement against Famous Trademarks, (study on the implementation of article 94 of Law No.15 of 2001 concerning Trademarks studied in the Malang Big Market)).
With the development of this era of globalization, it is appropriate that the government is more aware of the protection and application of well-known trademark laws in Indonesia to prevent losses to a brand business or losses experienced by consumers in Indonesia.
Famous brands have high appeal, an exclusive impression, and are often associated with a luxurious lifestyle. Products from well-known brands serve as consumer goods and as a symbol of social status for the upper-middle class. So, trademark registration is important as it is a step to get legal protection. In the "first to file" system, trademark owners must register their trademarks to obtain exclusive rights and protect the trademark from imitation by other parties. Registration should be done in good faith to prevent adverse practices. Good faith is an essential criterion that must be adhered to in trademark registration. Registrations executed with a malicious purpose, such as the imitation of reputable brands, may be denied and regarded as harmful to consumers and other commercial entities.
Well-known trademarks are protected by various regulations, both at the national level through the Trademark and Geographical Indications Act, and at the international level through agreements such as the Paris Convention and the TRIPS Agreement. This protection covers brands not yet registered, as long as they meet specific criteria. Although existing regulations are strong enough, implementing protection for well-known brands in Indonesia still faces various obstacles, such as inconsistent law enforcement, weak supervision of counterfeit products, and low public awareness of trademark rights. Consequently, measures are required to enhance the efficacy of safeguarding renowned trademarks, which include expediting legal proceedings, fostering collaboration between governmental entities and e-commerce platforms, and elevating public awareness regarding the significance of upholding trademark rights.
The legal protection of renowned trademarks in Indonesia is crucial for preserving their distinctiveness and prestige, as well as safeguarding customers from counterfeit items. The government and other stakeholders must collaborate to enhance the efficacy and transparency of this protection mechanism, particularly in a more intricate period of globalization.
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