INDONESIA: MASSIVE AMENDMENTS TO THE PATENT LAW

September 6th, 2016

 

On 28 July 2016, the proposal to amendment of Indonesian Patent Law was passed. It was to be effective starting from 28 August 2016, to replace the previous Law No. 14 Year 2001 on Patents. There are several key amendments that we would like to highlight as they bring significant effect to the patent applicants and owners.

Firstly, the changes made are on the exemptions from pharmaceutical patent infringement. Two new exemptions from pharmaceutical patent infringement have been presented, which are importation of a pharmaceutical product which is patented in Indonesia, and the product is legally marketed in another country without the permission of the patent owner; and manufacturing of a pharmaceutical product which is patented in Indonesia within five years before the patent protection expires, for the purpose of licensing and marketing after the patent protection of the patent expires (i.e. “Bolar exemption”). The authorities have stated that the exemption on the importation of pharmaceutical products is to safeguard that pharmaceutical products are reasonably priced, and access to pharmaceutical products is broadened. This requirement to implement the provision is if the price of a certain pharmaceutical product in Indonesia is very high compared to the price of a matching international product. The provision is strictly restricted to “pharmaceutical products,” and it does not allow parallel imports of non-pharmaceutical products. There is also a concept of “Bolar Provision” that would ensure that pharmaceutical products will be made available by another party after patent protection expires. It is the exemption on the manufacturing of pharmaceutical products to obtain a license. The five-year period before patent protection expires has replaced the former two year period. This will allow a pharmaceutical product to be manufactured for a longer time before the patent expires. Usually, a longer time is needed for marketing and applying for licenses at BPOM, Indonesia’s National Agency of Drug and Food Control. However, BPOM’s regulations must be parallel with the five-year period or the producers of generic drugs will not be able to use this new provision.

Secondly, the amendment has witnessed a second use or second medical use claims. Claims that are directed to a new use of a known product and a new form of an existing compound which does not offer significant increase in efficacy are no longer allowed, such as second use and second medical use claims. The amended law is now similar to the patent laws in India and Vietnam.

Thirdly, there are amendments on compulsory licenses. Compulsory licenses may be granted for developing or least developed countries that need a pharmaceutical product which is patented in Indonesia for the treatment of an endemic disease. The pharmaceutical product can be exported to the country after manufactured in Indonesia. A compulsory license would be granted to the government to gain the pharmaceutical product for the treatment of an endemic disease if the pharmaceutical product has not been manufactured in Indonesia.

Fourthly, the Appeal Commission Authority Expanded now has the authority to receive, examine, and decide on the appeal petitions of a refused application, a correction of the patent specification, claims, and/or drawings after the application has been granted; and notice of a grant decision with respect to a post-grant opposition. Before the amendment, the Commission could only examine appeal petitions of rejected patent applications. Furthermore, a post-grant opposition can be filed after the pre-grant opposition as opposed to the old system where an opposition could only be filed at the pre-grant stage. Post grant opposition of a patent is can also be done to third parties.

The fifth amendment is in the patent annuity fees. The back annuity fee payment must now be made within six months from the issue date, and failure to pay will result in the patent being deemed null and void. However, there exists a grace period for the annuity payment to the DGIP within 12 months from the time limit of the back annuity fee payment. The grace period must be applied within seven days before the deadline of the payment of the back annuity. The obligation to pay outstanding annuities under the old law will no longer be an issue for patentees.

The sixth amendment is the statement of ownership. The new law required the applicant to submit a signed Statement of Ownership of an invention when filing a patent application.

The seventh amendment is genetic resources and traditional knowledge. After the date of the enforcement of the new law, inventions related to and/or derived from genetic resources or traditional knowledge must clearly stipulate the origin of the genetic resources or traditional knowledge in the description.

The eighth amendment is patents as fiduciary objects. The new law permits patents to be used as fiduciary objects. Such example may be as a guarantee between a debtor and a creditor.

The final amendment is online filing. After the amendments, applicants may file patents application through an online filing. This system will simplify the administrative procedures for patent application filings. Thus, it will boost the applicants to file a greater number of applications.

In conclusion, the new amendments to Indonesian Patent Law has seen many changes that can surely improve the patent law to be applied to the public.