Indonesia Builds Stronger IP Ecosystem

Indonesia is working to create an efficient and effective intellectual property (IP) ecosystem to combat widespread piracy and counterfeit goods to attract investments from the United States and Europe. This action follows the release of the Office of the United States Trade Representative's Priority Watch List (PWL) for 2021. Due to extensive piracy and counterfeiting, Indonesia has been placed on the PWL.

According to Fortuna Alvariza, Founding Partner (Advocate & IP Counsel) of FAIP Advocate & IP Counsels in Indonesia, the country is now very different compared to 20 years ago.

"Indonesian business population has a better understanding of IP, and the Government also do the necessary to create a more promising IP protection environment in the country," she says. "The variables that must be improved are a mix, between the basic IP protection such as registration and other related prosecution systems, litigation system, and enforcement system.The efforts to build the IP protection has actually started since a long time ago, however it is true that many people can only feel little by little a positive impact from the improvement of better IP protection within around 10 years ago, especially with the enactment of new Trademark Law, Patent Law, Copyrights Law and other related regulations in around 2014 – 2019 which replaced the previous ones."

She adds that back in 2006, the Indonesian Government has established the National IP Task Force to combat IP violations that at that time still spread widely in Indonesia. The establishment of the Task Force was officially supported by the creation of the Presidential Decree No. 4 Year 2006. Since then, the Government has been continuing to conduct various activities to strengthen IP protection in Indonesia such as organising training for different relevant stakeholders, IP socialisation and education, strengthening the enforcement against IP violations, and many more. This task force was also created in order to remove Indonesia from the US Trade Representative (USTR) Priority Watch List and return better trust from the international business community.

"Further, in 2015 the Indonesian president Joko Widodo established Creative Economy Agency to boost national creative industries," she says. "One of the functions of the Agency is to develop public awareness and appreciation for intellectual property rights and optimize financial benefit for intellectual property rights holders, harmonization of regulations, strong cooperation as well as to create synergy across institutions and regions, optimize infrastructures, based on trustworthy governmental management that is transparent, effective, and democratic. The agency has been merged with the Ministry of Tourism and Creative Economy in 2019 and still actively continuing their works until now."

With all the development of IP protection, Indonesia not only gain trust from foreign investors but also created a healthier business environment.

"Local markets are now more aware of the importance to use the original products," she says. "If 20 years ago many local business owners preferred to create something that was not original and imitating foreign well-known products, we can now feel that they have a different mindset. The local business population has now more courage to create products that shows local identity and/or creativity, as well as having their own IPR. Although sometimes they are still inspired by other well- known foreign brands, usually they make necessary efforts to differentiate their products from the well-known mark.

Although we still find many IP conflicts, the online system of IPR still needs many improvements here and there, and Indonesia is still under the USTR Priority Watch List,  we can however feel that the level of comfort of the business population has been step by step increased. Further, the younger generation, such as Indonesian millennials and generation Z have a much better understanding on the importance to respect the originality of a product. Many of them avoid buying fake products because they know that something wrong with that kind of attitude, and they are prouder to wear or use original products or alternatively “no-brand” products instead of buying the fake ones."

If the government continues all the works that have been done, not only to create a good image of the country but more importantly focus to build good and healthy business habits, Indonesia will gain more trust and appreciation from both the local and international business community, she says.

"Further, Indonesia may boost the innovation and creative industries which is one of the goals of the Government, since the creative industries is targeted to become one of the strongest sectors that contribute the income to the country in 2030," she says. "In view of the improvement of the business environment especially related with IP matters in the last 5 years, we believe that Indonesia is on the right track for the better future of IP protection."