Shop And Trade Names Shall Be Regulated 

By: Dr. Iman Sjahputra SH, SpN, LL.M

Every entity in any field for sure has a name. The choice and use of the trade name has become a custom and it is not a compulsory because of government regulations. Every businessman always gives a name on the company they run. There are many ways and habits involved when a businessman is trying to find a suitable name for their businesses. For them who believe in “feng shui” indeed will ask their “suhu” and ask his guidance to get a trade name. But, there are people who choose a name based on what they like, easy to be said and sound good, even though sometimes it has no meaning. That is why sometimes we find there are many trade names have funny pronunciations. Trade names such as Sinar Abadi Lestari, Sinar Sentosa Jaya Abadi or Bukit Makmur Abadi may be are common to be found in the communities even though its meaning is questionable.

Actually in the legal trade name is mentioned as follow :

“As a name or destination serving to identify the enterprise or a natural or legal person”

Up until now Indonesia still has no regulation on the trade name. So the businessman is free to choose the trade name as they wish to use. This situation indeed will not satisfy all parties, because in one street we might find some shops displaying similar trade names. The similarity of the shop or trade name can be found either the services offered are the same or not. The existence of shops with same name legally cannot be debated by shop owners who are bearing the same shop names since there is no regulation about it yet. Indeed we have the regulation issued by the Department of Law and Human Rights relating to the establishment and legalization of a Limited Liability Company (PT) whereas it is clearly mentioned that the use of the two same trade names by two different companies is not permissible.

However, this regulation does not cover the other entity names such as Commanditaire Vennootschap (CV), Firm, Trade Venture (Usaha Dagang or UD) and Private Business such as shops. Consequently, this matter is often creating confusion in the communities.

Trademark Law.

While the Trademark Law No. 15 Year 2001 is not regulating the trade name, but it only regulates mark or trademark as mentioned in the Article 1 paragraph 2 of Law No. 15 Year 2002 which states :

“A mark which is used on the traded goods by someone or some people altogether or a legal entity to differentiate such goods with the other same kind of goods.”

A trademark is more into the product which is being traded, and not the trade names. It means, a product needs a name which is attached to it, so the communities/consumers will recognize it. Therefore, it is very rare for a product not bearing a mark. For a trademark which product is being circulated, legally cannot be used for the same product by two different companies. Therefore the owners of “Starbuck café”, “Bread Talk”; “Krispy Crème”, “Johnny Andrean” salon, “Plaza Senayan”, “Sogo” and “Suharti fried chicken” will never permitted its trade or service mark being used by the third party without their permission.

The prohibition to use such names is the same with the prohibition for the other parties to use the trade name or trademark which is made very similar to it. For example, “Coca Cola” trademark cannot be replaced and used by the third party to become “Cola Coca” or “Coco Cola” or “Caca Cola” for the same kind of beverages. This is deemed as the similarity in its principally regarding the sounding or writing as regulated in the Article 6 paragraph 1 of the Trademark Law.

The use of the same or similar trademark will create the right for the trademark owner to file a lawsuit against such same or similar trademark user. The common legal action taken is the cancellation of a mark in the Commercial Court. The case of Gianni Versace versus Danatella Versace which was registered in the Commercial Court No. 17/Merek/2003/PN.Niaga.Jkt.Pst in Jakarta is one of the examples which was filed by the Italian trademark owner who declared that both trademarks have its similarity in principally.

Aside from this legal action, the owner of the mark is also entitled to claim for the compensation to the owner of the same/similar trademark. The legal basis is Article 76, Law No. 15 Year 2001 on Mark. But, this compensation lawsuit shall be supported with strong evidence since the owner of the trade mark shall prove how much the actual loss is suffered borne by the owner of the trademark as the result of the act done by the trademark user that has similarity with his mark. A survey on the loss suffered which is conducted by an independent surveyor shall be done, for example to find how much is the decreasing turnover calculated from the rise of such problem. The invoices will become the evidences. In case of the evidences brought by the registered trademark owner is strong enough, then there will be no reason for the Commercial Court to reject the compensation lawsuit.