Legislation reform for trade secrets to become collateral for MSMEs in Indonesia

Abstract

In the year of 2010 the Government of Indonesia started the discussion on the use of the Intellectual Property Rights (IPRs) certificates as collateral by SMEs. The forms of IPRs discussed were: patents, copyrights, trademarks and lay out of integrated circuit designs. Nevertheless, actually there is one more IPRs form which is recognized by other countries, which can be used as collateral also, that is trade secrets. This work will examine three matters, why trade secrets were excluded from the plan; how should the Government of Indonesia change the laws to classify trade secrets to be used collateral and what the contents of regulations which should be amended and established to qualify trade secrets can be used as collateral for MSMEs. This study applied the framework of documentary research in the style of comparative legal research. Regulations which are used to make comparison with the Indonesian’s regulations are regulations related to collateralization on trade secrets in Australia, the USA, Thailand and the PRC. In order to get insightful from the Indonesian authorities’ perspective, the writer conducted consultations with officers of the Ministry of Cooperation and SMEs and Directorate General of IP Office of Indonesia. The finding of this study shows that, trade secrets were excluded from the plan to use IPRs certificates as collateral because the officer did not mention trade secrets explicitly like the other forms of IPRs. In order to qualify trade secrets as collateral, the procedures to change the law should be conducted based on the Law Number 12 Year 2011 regarding the Establishment of Regulations. There are some regulations which should be amended, The Law Number 30 Year 2000 regarding Trade Secrets, The Law Number 42 Year 1999 regarding Fiduciary matters, The Law Number 37 Year 2004 regarding Bankruptcy and Suspension of Payment and a Ministry Regulation. In addition there are some technical regulations need to be established. The finding of this study is significant for knowledge and hopefully can give contribution to the Government of Indonesia to not be reluctant to establish policies or regulation to include trade secrets in the plan to use certificates of IPRs as collateral. Furthermore, this study proposes recommendations on what regulations which should be amended and established to qualify trade secrets as collateral and matters which should be stated in those regulations.

Date of Award	2015
Original language	English
Supervisor	Maree SAINSBURY (Supervisor) & Don Fleming (Supervisor)