Why has IKEA lost its trademark in Indonesia?

In December 2015, the Supreme Court of Indonesia ruled that IKEA, the Swedish furniture company, lost the right to use its own name in the country.

Background | The timeline of the trademark dispute in a nutshell:

• IKEA registered its trademark in Indonesia in 2006 in class 21, covering household and kitchen utensils and in 2010 in class 20, covering furniture.
  • According to the local law and regulations, a trademark can be cancelled if it is not used for at least three consecutive years from the date of registration.
• In December 2013, PT Ratania Khatulistiwa, an Indonesian company, manufacturing rattan furniture registered its IKEA trademark in the same classes. According to the local company, IKEA is used as an acronym of the following words “Intan Khatulistiwa Esa Abadi,” which refer to rattan, a material that is used in furniture production.
• In 2014,  the Indonesian company filed an application to the central Jakarta district court, while the first IKEA retail store in Indonesia was under construction.
• In September 2014, the central Jakarta district court ruled in favour of the local rattan furniture company, ordering the Swedish company to stop using its own name.
• IKEA appealed against this decision, however, in December 2015, the Supreme Court ruled in favour of the local company. IKEA lost the right to use its own name in Indonesia on the ground of non-use.

Taking into account the implications of this case, it is essential to keep in mind that:

• The reputation of a brand name does not guarantee to its owners worldwide legal rights over it.
• The registration of a trademark AND compliance with the local trademark regulations are sine qua non requirements for the legal protection of a brand.
• It is essential to keep in mind at all times that non-use of a trademark may result in its irrevocable cancellation.

For legal advice on intellectual property and on trademark registration, you can get in touch with our IP lawyers.