Patent Compulsory Licensing:Things You Need Prepare

On November 2018, The Minister of Law and Human Rights (“The Minister”) issued implementing regulation for Law No. 13 of 2016 in the form of Minister Regulation No. 39 of 2018 concerning the Procedures for Granting Compulsory License for Patents (“Compulsory License”) (“MR 39/2018).

Compulsory License is a license granted by the government without the permission of the patent holder, or a license to implement a Patent based on the decree of The Minister on the basis of an application. Any persons, patent holders or government agencies may apply for a Compulsory License (“The Applicants”)1. The Applicants may request for the Compulsory License to The Minister based on conditions explained below:2

First condition, If a patent holder fails to carry out the obligation to conduct production or use the process in Indonesia within the period of 36 (thirty-six) month after a Patent is granted. Individuals or government agencies may file for the application of a Compulsory License; or

Second Condition, A Patent has been utilized in the way and form that may harm public interests. Individual or government agencies may file for the application of a Compulsory License in this condition; or Third Condition, A Patent which is developed from a previously-granted Patent which are unusable without other protected Patents possessed by a third party. Patent holders or government agencies may file for the application of a Compulsory License in this case.

The Applicants shall fulfil the following qualifications to be deemed an eligible Applicant: 3

1. Proof of the ability to fully implement the applied Patent and procurement of facilities to implement the patent promptly;
2. the Applicants or their representatives have attempted to obtain the license from the patent holder in the span of 12 (twelve) months based on reasonable requirements and conditions, but failed to obtain the Patent; and
3. The Minister regarded that the patent may be implemented in Indonesia on a feasible economic scale and beneficial to the public.

Provided that the requirements above have been satisfied, The Applicants shall submit the Compulsory License applications electronically or manually by filling out an application form, paying the fees and enclosing the required documents, such as:4 copy of the relevant identity documents; copy of company incorporation documents; POA; receipt for Compulsory License fees.

In addition, other than granting Compulsory License based on Conditions mentioned above, The Minister may also grant a Compulsory License that enables the production, import and export on products intended for human medications (q.v. Doha Declaration on the TRIPs Agreement and Public Health).5

In terms of royalty, The Licensee shall pay the royalty fee to the patent holder by considering the customary fee in similar licensing agreement or the advised fee proposed by the experts.6(TKK)

<1> MR 39/2018, Art. 1
<2> MR 39/2018, Art. 3
<3> MR 39/2019, Art. 7
<4> MR 39/2019, Art 9-11
<5> MR 39/2019, Art. 22
<6> MR 39/2018, Art. 28