Protection of popular brands

Frans H. Winarta ,  Jakarta   |  Fri, 04/04/2008 1:17 AM  |  Opinion

With the rapid development of international trade, Indonesia was flooded with new brands from abroad. Not only well-known brands from Europe such as Gucci, Prada, Mercedes-Benz and Siemens entered Indonesia, but also well-known brands from Asian countries, including Giordano from Hong Kong, Bread Talk from Singapore and Jimmy Choo from Malaysia.

Those brands are well-known because they dominate the market in various countries. Is that the parameter for classifying well-known brands? Is the parameter based on the market share and whether the products have been sold in various countries?

Due to the fragile situation against infringement of well-known brands, a specific mechanism to protect brands is required to prevent the increasing incidence of such infringement.

The mechanism for brand protection is regulated in the law on brands, particularly in article 6, paragraph 1 (b), which states the registration of brands will be rejected by the trademark office if there is an essential or total similarity with the brand of another party for goods and services of the same type.

In the event of dispute in determining whether a brand can be considered well-known or not, the commercial court may instruct an independent institution to conduct a survey to find out.

Indonesia has ratified several international conventions on IP rights, including the Paris Convention and Trademark Treaty. The Paris Convention makes mention of issues surrounding well-known brands, but is limited to claims against the issuance of brands entirely or partially similar to them. However, the definition of "well-known" is not given.

Many well-known brand cases have resulted negatively for the owner of the well-known brand. For instance, the cases of Prada and Intel Corp in Indonesia and Louis Vuitton in China. In those cases the brand owner from the country of origin often lost the case in court.

In one case in Indonesia, Prada of Italy filed a lawsuit against a brand in Indonesia named Prada. This case began when Prada-Italy filed for registration of its brand in Indonesia, but the name had already been registered by an Indonesian businessman. The commercial court rejected Prada-Italy's right to the name due to the fact Indonesia had adopted the principle of "first-to-file". At the court of last resort the Supreme Court supported the lower court decision.

Up to now the definition of well-known brands remains a conundrum. The parameter used is not clear. The criteria is not limited to brands owned by foreign parties but also includes local brands that have been successful in going international.

Legal protection is imperative owing to the fact that the brands must be protected against piracy and counterfeiting, which may reduce sales and tarnish a reputation.

At the same time the consumer will lose confidence in the quality of the product. It is therefore imperative the government issues regulation on well-known brands. This is in line with creating a healthy business and investment climate.

The protection of IP rights is a conditio sine qua non to create legal certainty and to maintain international trade and industrial relations. The predictability of the court's decision is also a way of maintaining legal certainty so that the business actors feel secure in doing business in Indonesia.

Those conditions will gain credibility from the international forum and at the end of the day it will boost the Indonesian economy.

Dr. Frans H. Winarta is a lawyer.

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