Trademarks with their brand image can satisfy the consumers’ need for identification or distinctive tokens, which is very important and serves as assurance of the product or service quality in a free trade and free competition atmosphere.

Trademarks serve as an identification mark since they are used to distinguish the products of a person, persons or a corporate body from other persons or corporate bodies.

That’s why a trademark is an asset of a company that may have many gains when utilized by observing the good business and management process aspects. A trademark is a key consideration in making business decisions and is also intellectual capital with economic value that may be added in products and technologies. A trademark can also improve the value or be assurance for the investor and financial institutions.

So important is the trademarks’ role that legal protection must be attached to them in connection with an individual or corporate body rights. For goods and services in the trade and industry, the roles of a trademark are so important thanks to their economic and juridical aspects.

In line with the growth of international trade and the advancement of information, communication and transportation technologies, the globalization of trademarks, which is one of the embodiments of intellectual works of humans, is inevitable.

Nowadays, Indonesia has been strengthening its trade relations with the US by synchronizing the perception as the first step of establishing bilateral relations between the two countries. The US is the second largest export destination for Indonesia with a market share of 12 percent of the total Indonesian export value.

The US investment value in Indonesia in the period of 2007-2008 rose by 4.6 percent from US$144.7 million to US$151.3 million. Indonesia has also been the 31st largest trade partner of the US.

Indonesia and the US have also established some work groups aimed at strengthening the economic relation between the two countries in four important areas: Intellectual property, agricultural and industrial products, services and investment.

Based on the above data, it is obvious that currently trade relations between Indonesia and the US has been stronger and stronger with more US businessmen investing in Indonesia. In line with the increasing US investment in Indonesia, legal protection for trademark used by US businessmen in

Indonesia must also be improved since, in addition to its function as a business asset of the company, a trademark also relates closely to its business image, goodwill and reputation.

In protecting trademarks, Indonesia adopts a constitutive , namely the right over a trademark will be created or acquired by means of registration. Article 3 of a 2001 law regarding mark/brand provides for that a Right over a trademark is an “Exclusive Right” by the state to the trademark holder registered in the “Public Register of Mark” for a certain period of time to use or to license the trademark to the other party.

By referring to provisions of the 2001 law, should there be any US businessman who wants his trademark used in Indonesia to be protected, the US businessman must register his/her trademark with the Directorate General of Intellectual Property Rights of the Republic of Indonesia.

The mark must be registered by US businessmen investing in Indonesia and using the mark as a key part of their business activities in Indonesia, since delayed registration of the trademark by the US
businessmen, another party, who in fact has no right over such trademark, may have registered the mark of the US businessmen with the Directorate General of Intellectual Property Rights of the Republic of Indonesia.

When this happens, the US businessmen must file a Motion for Cancelation of the Mark Registration with the Central Jakarta Commercial Court, the proceedings of which will cost far higher than the costs required to file an Application for Registration of a Trademark with the Directorate General of Intellectual Property Rights of the Republic of Indonesia.

One of the US trademark cases in Indonesia is the case of the well-known mark “Subway”. In this case, Doctor’s associates Inc., a US company located in Florida, the US, was late in registering its well-known mark “Subway” in Indonesia.

As a result, another party who in fact has no right over such a trademark has registered it with the Directorate General of Intellectual Property Rights of the Republic of Indonesia.

In order to settle this dispute, Doctor’s Associates Inc. must file a Motion for Cancellation of the other party’s Mark Registration with the Central Jakarta Commercial Court. Definitely, the costs of proceedings were far higher than the costs required to file an application for the registration of a trademark with the Directorate General of Intellectual Property Rights of the Republic of Indonesia.

At the end, the Indonesian Commercial Court issued a verdict in 2009 in favor of the Doctor’s Associates Inc., which was then upheld in the same year by the Indonesian Supreme Court, making the Florida-based company the sole owner and the first registrant of the internationally well-known mark “Subway”, and therefore they have the sole right to use their well-known mark “Subway” in Indonesia.

The writer is a managing partner of Dwipo, Lubis & Partners Law Firm.

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