Copyrights, a worthless collateral? 

Copyrights, a worthless collateral?

By: Dr. Iman Sjahputra, SH., Sp.N., LL.M.


The creative industry in the era of Joko-Widodo-Jusuf Kalla’s Government becomes one of the

programs to encourage Indonesia’s economic growth, since there are various things to be be explored

in such manner by various communities, from handicrafts, music, to movies.


In order to encourage this potential to continuously evolve, a non-ministerial government institution

which is under and responsible to the President was formed and the Presidential Decree No. 6 Year

2015 was enacted to regulate the functions and duties of this new institution called Creative Economy

Agency (Bekraf).


The President is optimistic that the creative industry will become the future of Indonesia, "Starting

from handicrafts, music, movies and digital. The design is unique since it is handcrafted and the quality

is quite good" according to him, in the Inacraft 2017 Event at JCC Senayan, Jakarta. As a matter of

fact, the President states, the quality of the creative industry is quite good and meets the desired

national and international standards. The products are also highly varied. The hope and the optimism

of the Head of State are certainly not impossible to be realized if accompanied by optimal protection

towards the Indonesian’s creative products as stipulated in Law No. 28 Year 2014 concerning



The creative and art world in this Nation have produced many artists, such as literateur, painters and

songwriters which produced good and interesting works. However, the question remains, can such work

be secured for debt? If yes, then how? This question arises due to many of creative, smart, bright and

full of ideas creators whose creations are good and interesting, however, it is less marketable. As a

result, the economic value attached in an artwork is decreasing since there is no buying interest. If this

occurs, it may affect the creativity of the artists to decline.


For the creators, artwork becomes the result of achievement. Creation is derived from ideas and

feelings. The result is originated from the creator. Therefore, a high-quality work is not required to

meet the tastes of the people and consumers, as they may vary. If this is the case, how about the

paintings from Picasso, Leonardo da Vinci, Affandi and Basuki Abdullah are valued? How much is the

economic value and market price? What is the estimated value of such maestro’s paintings to be

provided to the bank as a security for debt? Will it be feasible as a collateral and how is the

implementation? For Affandi’s painting enthusiasts, an abstract painting of "Andong/Horse Cart" that

was auctioned at the Christie’s Hong Kong auction hall may worth HK$ 2.5 million (more than Rp 4

billion) and painting of S. Sudjojono "The Ruins and The Piano", for HK$ 9.06 (more than Rp 15 billion),

in the Christie’s auction hall in 2017. But as aforementioned, the perception in assessing value for each

person may be different.


Our artists, despite their names are well-known and famous internationally, not all are economically

stable. Especially when they are no longer productive. If so, then an artwork is not a recoverable

collateral for the bank and it is difficult for a bank to lend a loan to the creator. Such conditions are in

contrary to Law No. 28 Year 2014 concerning Copyright, wherein stated in Article 16 paragraph (3),

that a copyright may be used as an object of fiduciary collateral. Being set as a collateral, a copyright

surely has a market value, however the concern is how much the estimated value of the created item

or product? The subjective estimation makes it very difficult for a bank (and its appraisal) to calculate

on the approved loan relevant to such collateral.


Bekraf (or other specific institution for the need) needs to be more developed or optimized so that this

institution can also estimate or appraise an artwork for the bank’s basis in calculating risk and

approved loan, further, the Law No. 28 Year 2014 itself needs to be further equipped with detailed

implementing regulations on the valuation, process and enforcement for the bank to rely on rather than just relying on the "underregulated free market". This is to answer the question of whether

copyright still has its worth of being a collateral as mentioned in the Copyright Law in practice.***


The author is an advocate domiciled in Jakarta.


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