The Government of the Republic of Indonesia is set to issue a presidential regulation on implementation of patents by patent holders. This regulation will be issued to provide clarity on the implementation of Article 20 of Law No. 13 of 2016 on Patents (Patent Law). The Directorate General of Intellectual Property of Indonesia announced the draft regulation last month.

Article 20 of the Patent Law requires patent holders to either manufacture their patented products in Indonesia or to use their patented processes in Indonesia. The manufacturing of the products or the use of the processes should support the transfer of technology, drive investment absorption and/or provide job opportunities.

Under the draft regulation, patent holders who have not manufactured their patented products or used their patented processes in Indonesia may request postponement of implementation of a patent if:

  • the patent holder does not have the capability to implement the patent; and/or
  • the implementation of the patent is not justified by the economic value to be gained by the patent holder and the benefits to be gained by the community.

The following are key provisions of the postponement of implementation of patent under the draft regulation:

  • A patent holder may file a request to the Minister for approval of the postponement of implementation of a patent. Each request may only be filed for one patent.
  • The request for approval of the postponement of implementation of a patent must be filed at the earliest 24 months, and at the latest 30 months, after the patent is granted.
  • The Minister will decide to approve or dismiss a request for postponement after the request has gone through an examination.
  • Further provisions on procedures for postponement of implementation of patents will be stipulated in a ministerial regulation.

Some of the provisions of the draft regulation are not yet clear. Therefore, the Directorate General of Intellectual Property is currently receiving feedback on the draft regulation, hence we can expect more changes on the draft regulation in the near future. We will circulate another alert once the regulation has been officially enacted.