Comparative Analysis of Intellectual Property Protection and Blockchain Integration in India And Indonesia

This paper examines the status of intellectual property (IP) laws in India and Indonesia, especially in the way these nations are utilizing blockchain technology. This is on the account of how the society is blockchain savvy, a technology that is infamously known for its disorganized and clear nature and hence impinging possibly making the management of IP more efficient, thanks to its characteristics. we wrote our analysis of the combinations and conflicts between the legislation of these two countries and the current state of integration of blockchain into IP law. The results suggest that improvement is underway but the two countries can be considered at different levels of readiness when it comes to the vertical inclusion of blockchain into the IP architecture.

The adoption of blockchain technology has determined the new order of information system management, which comes with such advantages as indelibility, openness, and security. This particular technology of recording information in a distributed computer network without the possibility of altering it has shown a revolutionary potential in almost all spheres of activities and management of intellectual property (IP) rights is not an exception. Intellectual property is the kind of asset that requires advanced means of safeguarding it from data piracy, production infringement, or modification of content. In fact, the development of blockchain brings a new approach towards registration, safeguarding, and enforcement of intellectual property (IP) thereby solving the timeless problems of IP administration. The study seeks to provide a comprehensive understanding of how blockchain technology is being utilized and what challenges remain in the journey to achieve effective IP management.

Intellectual Property Protection and Legislative Frameworks

Intellectual property law forms the basis upon which the fruits of human creativity are protected. These include inventions, designs, literary works, and trademarks. Countries differ in their social, economic, and cultural backgrounds and have moved toward legislative steps toward protection of intellectual property.

India has a sound legislative framework for safeguarding intellectual property rights, including copyrights, patents, trademarks, and trade secrets. The primary source of copyright law in India is the Copyright Act, 1957 which provides for protection against any sort of infringement to all forms of creations, that is, with respect to literatures, art and music. The Patents Act, 1970 covers a wide range of issues relating to patentable inventions and their applications, while the Trademarks Act of 1999 deals with the aspects of registration and protection of trademarks and service marks. India has provisions for protection of trade secrets under the Indian Contract Act of 1872 and the Information Technology Act of 2000.

India showed a great interest in blockchain technology, but in terms of law, it is still underdeveloped. The Cryptocurrency and Official Digital Currency Regulation Bill of 2021-more widely known as the “New Bill”-attempts to catch up with the rising status of digital assets: this bill will create a legal basis for their regulation and use in India. This bill, when enacted, can open up channels for the introduction of blockchain technology into IP management, and thus smart contracts and records can be utilized in securing copyrights, trademarks, and patents.

It is regulated by a typical framework of various laws in Indonesia safeguarding the diversities of intellectual property. Law No. 28 of 2014 includes copyrights and protects the authors of original work, including published books, music, and films. The law on trademarks is covered by Law No. 20 of 2016, while patents are covered under Law No. 13 of 2016. Indonesia’s law regarding trade secrets falls under Law No. 30 of 2000, which concerns confidential business information and processes. Intellectual property in Indonesia is under the administration of the Directorate General of Intellectual Property Rights within the Ministry of Justice and Human Rights.

Indonesia has recognized the function of blockchain to be played in modifying IP protection and therefore has started to move towards implementing this technology into managing IP. In this regard, it is observed that Law No. 28 of 2014 provides the legal framework applicable for copyright registration and protection in terms of using blockchain. Blockchain is perceived as an important tool that may help in registering copyrights, trademarks, and patents with good features for transparency, security, and traceability.

Blockchain Integration in Intellectual Property Management

There are a number of possible uses in the management of intellectual property which in a way presents creative answers to some of the basic problems faced by IP proprietors. The decentralized structure of the blockchain implies that any data recorded into the system is immutable, guaranteeing the integrity and security of the data. In this way, blockchain can be used in intellectual property settings to record creations of works, register copyrights, verify real use of trademarks, manage licensing agreements, and create transparency in royalty distribution.

Current Indian stances on blockchain have not introduced it in the framework of IP management yet but have benefits that are being slowly recognized. Copyright Act, 1957, needs blockchain to establish transparent, secure, and immutable records of authorship which would prevent piracy and unauthorized utilization of the said copyrighted works. The decentralized nature of blockchain ensures that all parties to a contract will be present on the blockchain. Therefore, in cases of copyright infringement, there would be less of a debate on infringement. Trademarks and patents can also be handled through blockchain technology, where the records for registration and use are maintained securely in the blockchain. Specifically, the Cryptocurrency and Official Digital Currency Regulation Bill, 2021 will eventually give blockchain and digital assets a fundamental regulatory framework that sets the grounds for using blockchain in IP management.

Indonesia has been on its way to integrating blockchain technology into the management of intellectual properties. The Electronic Copyright Application System, popularly known as SPSE, is a blockchain-based system for registering copyrights, which allows creators to register their works online and receive blockchain-protected copyright certificates. The registration process is therefore made efficient while simultaneously providing the guarantee that all the information uploaded into the system remains intact. The management of trademarks and patents is also being experimented with blockchain technology in the effort to provide more security and transparency in the process of registration.

Challenges in Blockchain Integration for IP Protection

The use of blockchain technology for the enhancement of IP protection has myriad advantages, however, it comes with its fair share of drawbacks. With respect to the integration of blockchain technology in the IP regimes, there are several regulatory, technical, socio-economic and legal challenges not only in India but also in Indonesia. Recounting on the issues faced and progress made, the integration of blockchain technology in the management of intellectual property still needs a lot of work.

The absence of a considerable regulatory regime for the utilisation of blockchain cut across both countries, remains one of the most critical concerns. On the one hand, although countries like India and Indonesia have made commendable efforts to embrace blockchain, they have all stayed silent on concerning legislation to address the issues on blockchain technology as far as IP management is concerned. Failure to put in specific regulations towards blockchain IP management brings on a feeling of doubt which creates hindrances in implementing the blockchain technology. For instance, in India, while the New Cryptocurrency and Official Digital Currency Regulation Bill of 2021 proposes to establish a statute on virtual assets, the proposal has not yet received Parliamentary approval and no provisions regarding the management of IP rights have been articulated.

Technological challenges constitute another primary obstacle in incorporating blockchain technology as an IP protection strategy. IP management systems that are based on a blockchain may have additional technical requirements, along with the additional capital investments required in developing certain infrastructures. Moreover, decisions must be made concerning the allocation of various tasks and responsibilities, including that of data preservation that is best suited when performed in a centralized manner in contrast blockchain works on decentralised manner. In the case of IP management, this may imply that there is a high risk of information leakage to unauthorized individuals, including but not limited to business secrets or information on pending patent applications. Overcoming these technical barriers is not only a challenge that requires enormous amounts of money toward technology and infrastructure upgrades, but also the creation of strategies, policies, and procedures geared to the protection of information assets.

At the same time, the legal aspects do not allow for easy incorporation of blockchain into IP management practices. The first and most important legal issue in this respect is the treatment of records on a blockchain as proof of ownership or usage that may be admissible in court. In particular in the case of IP management, this technology would assist in offering inscriptions on the rights within a work, the trademark itself, or a patent without the possibility of altering any information in these records. Still, these records must be evidence, in the proper sense of the word, to have any effect, or they must be put on a template that is acceptable for compliance with the statutes in force. In both these countries the issue of legal status of blockchain records is still open, which impedes its application in IP management.

Conclusion and recommendations

The use of blockchain technology in the management of intellectual property is going to revolutionaries how IP rights are created, maintained and enforced. IP management issues such as transparency, dais security, and in preventing unauthorised use can easily be dealt with due to the distribution thrustless features of blockchain, and its capability of crafting permanent and unaltered records.

India and Indonesia have all acknowledged the promise that blockchain technology holds in its application in IP management but are at different levels of maturity and with different issues. While Intellectual Property of India is at a very nascent stage in Integrating blockchain technology, and is mostly aimed at formulating policy on digital assets, Indonesia is much further ahead with already a fully-fledged functioning trade mark copyright registration on a advertising system functional system.

Few but very important are the measures that must be implemented in order to assess the feasibility of blockchain technology use in effective management of IP. First of all, and in the context of both countries, the separate and comprehensive regulations and norms regarding the use of blockchain technology in IP management should be formulated. Such limitations need to address the issues concerning the legal status of blockchain registries, the implementation of smart contracts, issues of confidentiality. Plans to promote cooperation with such international institutions as WIPO are also included so that norms acceptable around the world could be developed concerning the use of blockchain technology in IP administration.

Additionally, Smart contracts are transformational in the domain of intellectual property management since they enable the creation of computer programs that are able to embed the pretext of an agreement in a code and enable that agreement to execute on its own without human enforcement. Smart contracts are software programs which automatically implement, control and enforce legal contracts without manual processes, thus able to allow legal worth systems such as licensing, IP rights infringement enforcement, royalty distributions, etc. Such contracts can automatically ensure the execution of all the clauses in a contract. Hence, eliminates the middle man who is the agent, hence faster performance.

Furthermore, physical and technical systems is needed to ensure that blockchain technology can be used in managing intellectual property assets. Blockchain-based IP management systems still require heavy investment in technologies and infrastructures as well as formulating and putting in place policies and processes for information safeguarding. There is a need for governments and other policy makers to come up with complementary policies to promote the use of blockchain technologies including building the necessary infrastructure and services.

Given the right enablers in the form of proper regulations, heightened understanding of blockchain technology and collaboration of key players, particularly institutional players in the content industry, blockchain will be a vital tool in enforcement of IP laws especially in the digital environment.

Author: Sneha Agarwal, in case of any queries please contact/write back to us via email to [email protected] or at Khurana & Khurana, Advocates and IP Attorney.