PASSING OFF: A CONCEPT OF UNFAIR COMPETITION THAT MAY NOT BE IMPLEMENTABLE IN INDONESIA

Unfair competition in business has long been debated in Indonesia among both businessmen and academics. Although the country possesses several laws addressing unfair competition, their enforcement remains ineffective, particularly in the area of intellectual property rights (IPR), with trademarks being the most affected. Such practices not only undermine the financial capacity of companies but also disrupt the national economy, reduce workers’ welfare, and hinder broader development. Addressing unfair competition must therefore begin at the level of IPR policy-making and be further reinforced through concrete technical regulations. Since the enactment of various trademark laws, numerous infringers have been punished in accordance with the level of their offenses. However, these legal outcomes have not significantly deterred perpetrators, especially those engaged in cross-docking. This is because Indonesian trademark law is primarily designed to protect registered trademark owners rather than to directly combat unfair competition. Consequently, a more concrete approach is required, either by extending the scope of trademark law to tackle such practices or by formulating new legal strategies. One possible avenue is to establish a separate legal regime specifically aimed at abolishing attachment claims linked to unfair competition. Yet this option is time-consuming, requiring extensive discussion, socialization, and agreement on mechanisms for proving actual damages in court. Moreover, if stronger measures are to be enacted through new legislation, the drafting and approval process will inevitably be lengthy, given that legislation is a political product requiring consensus from the House of Representatives. Thus, while Indonesia has laid a legal foundation for protecting trademarks, eliminating unfair competition demands both policy innovation and stronger enforcement to safeguard businesses and promote sustainable economic development.