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Legal Protection for Trademarks in Indonesia Compared to The United States: The Difference Worth Discussing

27

OCT

2022

Mark is defined as any sign capable of being represented graphically in the form of drawings, logos, names, words, letters, numerals, colors arrangement, in 2 (two) and/or 3 (three) dimensional shape, sounds, holograms, or combination of 2 (two) or more of those elements to distinguish goods and/or services produced by a person or legal entity in trading goods and/or services. The sentence is the definition of a mark according to the Trademark Law Number 20 of 2016 concerning Marks and Geographical Indications in Indonesia (hereinafter referred to as the Indonesian Trademark Law). Furthermore, the US Trademark Law (Lanham (Trademark) Act, 15 U.S.C), as stated in section 45, §1127, The term “trademark” includes any word, name, symbol, or device, or any combination thereof— (1) used by a person, or (2) which a person has a bona fide intention to use in commerce and applies to register on the principal register established by this chapter, to identify and distinguish his or her goods, including a unique product, from those manufactured or sold by others and to indicate the source of the goods, even if that source is unknown. Both countries define a mark as a form used for commercial purposes, but the key distinction lies in the statement "which a person has a bona fide intention to use in commerce and applies to register on the principal register established by this chapter" included in the United States Trademark Law.

As a result, the question of whether the substance and principles of trademark law in Indonesia differ from those in the United States arises.

The answer is: YES. The distinctions in trademark law between the two countries will be addressed further down.

First-to-file and First-to-Use

Notably, trademark law in Indonesia conforms to the "first-to-file" principle. The principle of first-to-file establishes that the trademark right belongs to the entity whose trademark application has the earliest filing date. In this term, the date of filing is important, not the date when the trademark was first used in commerce. This has been regulated in Article 1 number 5 of the Indonesian Trademark Law, namely: “Right on Mark means the exclusive right granted by the State to a registered Mark owner for a definite period to use his/her Mark or authorize others to do otherwise.” Indeed, most countries in the world are the first-to-file countries for trademark registration. According to the first-to-file trademark regime, applicants who file an application for registration of their marks first are granted trademark rights and priority, notwithstanding if the Applicants have used the marks in commerce or even whether others yet used the marks in commerce before.

On the contrary, the United States follows the concept of first-to-use, which states that a trademark belongs to the first entity/proprietor to use the mark in connection with the sale of goods or services in the market. The Lanham Act, 15 U.S.C. 1051(b)(1), reflects this scope.

In a first-to-use trademark country like the United States, the person who is first-to-use the mark in commerce has the right to register it, regardless of when the application was filed. Unlike filed or registered trademarks, unregistered (depending on length of use) trademarks have limited legal rights to establish a trademark. There are exemptions; primarily, trademark rights go to the first-to-use proprietor, not the first-to-file. The mark's registration status at commercial utilization determines first-to-use priority.

Under U.S. trademark law, an Applicant that has filed an application to register their mark can assert priority against a user of an unregistered mark, so long as[1]:

  1. the Applicant has actually used the mark in commerce prior to the unregistered user’s use of the mark in commerce in the same geographical territory, or
  2. the Applicant is able to successfully register their mark provided that:
  1. the Applicant filed the application for trademark registration prior to the date of actual use of the mark in commerce by the other unregistered user, and
  2. the Applicant has either actually used the mark in commerce, or has shown a bona fide intention to use the mark in commerce at the time of filing the trademark application, followed by actual use within the specified amount of time.

Marks which are protected in the United States but not in Indonesia

Despite fundamental differences in how each country protects the trademark owners, the United States has a far more comprehensive and advanced system for protecting trademarks than Indonesia does. The following are types of trademarks that are protected in the United States, but not in Indonesia.

  1. Trademark a Color

A color can be protected as a trademark under certain situations. Single colors and color combinations may be trademarked as part of a product, package, or service since 1995, despite neither being included in the legislative definition of a trademark nor previously being eligible for trademark protection. To assert trademark rights in a color, the proprietor must demonstrate that the color has acquired distinctiveness when applied to the relevant products and services. In other words, the trademark owner must show that the consumer, upon seeing the colour used in connection with the goods or services, views the colour not as merely ornamental but, rather, as a means of indicating the origin of those goods or services.[2] Examples of protectable colour marks include: red soles for women’s high-heel dress shoes, where the rest of the shoe is not also red (Louboutin); pink fiberglass insulation (Owens-Corning); red knobs on cooking appliances (Wolf); light blue for jewellery boxes (Tiffany); brown for parcel delivery trucks and uniforms (UPS); and magenta for telecommunications services (T-Mobile).[3]

Color marks require proof of “secondary meaning.” That is, a color can be trademarked in connection with a particular good or service if, through the use of the color over time as applied to a particular good or service, the public has come to associate that color with a particular source.[4]

  1. Trademark a Phone Number

The Chicago World's Fair-1992 Corp. v. Chicago World's Fair Commission court was the first to establish trademark rights in a telephone number. If a telephone number fits the conditions of a trademark, it can be protected as a trademark. The consumers can rely upon it to distinguish the trademark owner's goods or services from those of competitors. Numerous legal approaches concerning the protection of vanity numbers-particularly those incorporating generic material-have surfaced. There is growing support for protecting numbers that incorporate generic matter.[5] For instance (in Indonesia only), if we heard the phone number of "14045," we would immediately recall the number as McDonald's brand.

  1. Trademark a Surname

Pursuant to §1052 of Lanham Act, 15 U.S.C., surnames are not given trademark protection, but a surname can qualify for protection if it acquires a secondary meaning[6]. Secondary meaning exists when consumers recognize the surname trademark as a signifier that distinguishes the goods or services of one seller from another.[7] The mark can acquire secondary meaning through extensive use and advertising in commerce. Despite the difficulty of protecting surnames as trademarks, we are surrounded by surnames which have been registered as trademarks, for instance McDonalds, Ralph Lauren, Suzuki, Sony, Procter & Gamble (P&G), Johnson & Johnson, and Dell are just a handful of the numerous trademarks that exist globally.

  1. Trademark a Scent/Smells

Scents can be trademarked just like any other product. Businesses are becoming increasingly interested in incorporating attractive smells into their products due to the widespread perception that the sense of scent is one of the most powerful forms of human memory. To register a smell mark, applicants must be able to visually depict the product's smell and demonstrate that it is distinguishable from the product itself.[8] For example, Play-Doh has done it. The scent of Play-Doh was not functional but was distinct to the product. People do not need the scent of Play-Doh to use it. If someone close the eyes and think back to the days playing with Play-Doh, a distinct smell probably comes to mind.[9]

The question that emerges from the above explanation is whether the first-to-file or first-to-use principle is preferable.

Among the reasons for its worldwide implementation of the first-to-file regime, including Indonesia, It is likely simpler to determine the first entity to apply for trademark registration than to determine the entity that may have first used the unregistered mark in commerce and in which geographical territories to establish priority. According to Sudargo Gautama[10], at the time of registration, trademark law in Indonesia utilizes a passive system (passief stelsel) under which the original owner of the mark in question is not scrutinized. Even when the Trademark Office (TMO) registers a mark, they just examines the trademark database to determine whether the mark or a similar mark has been registered by someone else; if otherwise, the registration is accepted. Adopting a first-to-file trademark policy that disregards any prior significant worldwide or local commercial usage of the mark by others, however, has a number of drawbacks. Where two or more applicants apply for the registration of identical or similar trademarks for the same or similar goods, the preliminary approval, after examination, and the publication shall be made for the trademark which was first filed. Where applications are filed on the same day, the preliminary approval, after examination, and the publication shall be made for the trademark which was the earliest used, and the applications of the others shall be refused and their trademarks shall not be published.[11]

Under this regime also, the high volume of trademark application filings and approvals has led to widespread trademark squatting globally, including in Indonesia. Even world acclaimed corporations like IKEA and Superman from DC lost trademark disputes in Indonesia for registering and utilizing their own mark in Indonesia, due to the fact that trademark squatters registered their trademarks before they did.

In comparison, countries such as the United States abide to the first-to-use concept, similar to copyright regime in Indonesia. The presence of this initial use, nonetheless, does not prevent an entity from registering a trademark in the United States. Author believes that the First-to-Use principle also has several drawbacks, including the premise that it's going to be more challenging to determine who actually had used mark first compared to the first-to-file approach. In addition, trademark can only be registered if it has already been used commercially (any mere intent is insufficient if it is not substantiated by evidence demonstrating the bona fide intent). Despite its drawbacks, the first-to-use concept not only offers adequate protection for the original first user of the trademark, but moreover encourages mark owners to pursue registering trademarks to establish strong ownership, thereby increasing the government's responsibility to protect the registered mark's owner against third parties who may wish to file a confusingly similar mark to the registered mark.

In this regard, the author believes that the first-to-use approach is preferable to the first-to-file principle, as it will provide solid and uncompromising protection in Indonesia. In order to increase the security of the trademark it already has; registration of a trademark is also recommended.


[1] See § 1126(d) of Langham Act, 15 U.C.S.

[2] INTA Bulletin, November 15, 2009, Vol. 64, No. 21, p. 2

[3] Michael Bernet, “Can You a Trademark a Color?”, IPWatchdog, https://www.ipwatchdog.com/2018/07/14/can-you-trademark-a-color/id=99237/

[4] Ibid.

[5] Ann K. Linnehan, “Need Trademark Protection for a Generic Domain Name? Help May be Just a Phone Call Away”, 2002, 38 GONZ. L. REV. P. 512

[7] ibid

[10] Prof. Dr. Sudargo Gautama, S.H., “Segi-segi Hukum Hak Milik Intelektual“, Bandung:PT Eresco, 1990, p. 20

[11] Tulip Mahaseth, First-to-use versus first-to-file trademark regimes, https://www.redpoints.com/blog/first-to-use-vs-first-to-file-trademark/

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