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Indonesia said NO to IKEA

published on 14-03-2016

In February this year, the Supreme Court of Indonesia made public a ruling, which causes a serious damages to Ikea. The Swedish company was denied the right to use its brand name in the country.

The decision is a result of a claim against IKEA by a local furniture manufacturer, whose name Intan Khatulistiwa Esa Abadi in abbreviation is written in the same way as that of the famous world brand.
The case dates back to 2014, when IKEA started the construction of its outlet in the Tangerang city near Jakarta. Then the small enterprise for production of rattan furniture PT Ratania Khatulistiwa took its case to the Central Jakarta District Court which in September 2014 ruled that IKEA can not use its brand name in the country. The Swedish company appealed taking the case to the supreme instance.

With the contested decision the Indonesian Supreme Court confirmed the lower court's judgment and settled that the company Intan Khatulistiwa Esa Abadi who registered its trademark in 2013 has a registration priority before IKEA. The decision raises curiosity because although the Swedish company registered its trademark in Indonesia in 2010 in the following three years the brand has not been used for commercial purposes. This fact, according to the Indonesian law means that, the mark should be invalidated. The court held, therefore, that the trademark loses its priority regardless of the earlier registration date.

Although the ruling was not unanimous and that it comes to a worldwide known company with steadily plan for expansion, the unfavorable decision is final and IKEA is forced to make a step back in Indonesia.