Global trade developments have been running quickly and moving towards liberalized trade in which all states must open their respective markets. Trade globalization marked by the ever increasingly obscure state borders has raised trade transactions, therefore, the open domestic and foreign markets as a result of trade globalization/liberalization have led to a surge in the production of and demand for legal and illegal Optical Discs in Indonesia. Indonesia, with a population of more than 200 million, is a good market for products recorded on Optical Discs, particularly pirated products sold at low prices.
The piracy of intellectual property rights (IPR) through Optical Discs has been growing rapidly particularly since 1999 in line with the rapid growth of Optical Disc technology. The rampant circulation of illegal products in the form of Optical Discs has become cause for major concern among countries and Copy Rights Owners, eroded the credibility of countries, and deviated from the principles of sound trade as specified in the WTO/TRIPs rules.
The rapid growth of pirated Optical Discs is mainly caused, among other things, by weak legal sanction against IPR violators, poor control because all Optical Disc producers are very closed and have no clear identity, easy access to sophisticated technology to replicate Optical Discs in a relatively short time, low production cost of pirated Optical Discs because the pirates neither pay royalties, taxes, fee of supporting artists/musicians, and lease on production house nor spend promotional costs, and poor supervision of the importation of replicating machines and raw materials (polycarbonate).
If the piracy of Optical Discs is left unsolved, it will bring about negative impacts, such as the possibility of investors canceling their investment/business expansion plans, the declining credibility of the state in its relations with foreign countries, the declining creativity and motivation on the part of the people, the creation of unsound competition on the domestic market, a decline in the amount of state revenues from the tax sector, and a threat to Indonesia’s exports to WTO member countries.
Where the IPR are concerned, since 1996 Indonesia has been put on the Priority Watch List (PWL) based on Special 301-US Trade Act 1974. The USTR is gearing up for an Out of Cycle Review (OCR), namely a review or monitoring of law enforcement against IPR violators in Indonesia in accordance with TRIPs. If the result of OCR shows significant progress in the protection of IPR, Indonesia will be removed from the PWL position, thereby increasing its trade relations particularly with the United States and Europe, encouraging the development of Optical Disc industry, and raising the state revenues from the tax sector. On the contrary, if Indonesia fails to make significant progress, this will increase the number of IPR violations, reduce Indonesia’s credibility on the eyes of the world community, discourage foreign investors from investing in the Optical Disc industry or other industries, disturb the legal Optical Disc industry, lower the state revenues from the tax sector, and threaten Indonesia’s exports to/trade with the United States and Europe.
Judging by the above condition to prevent efforts to replicate or multiply pirated Optical Discs and promote the Optical Disc industry, it is deemed necessary to stipulate a Government Regulation concerning High Technology Production Facilities for Optical Discs as a follow up to Law Number 19 of 2002 concerning Copy Rights.
II. ARTICLE BY ARTICLE
Article 1
Self explanatory
Article 2
Self explanatory
Article 3
Self explanatory
Article 4
Paragraph (1)
Referred to as accredited means accredited by the International Federation of Phonographic Industry (IFPI), among others.
Paragraph (2)
Letter a
Stamper code means the code applied using a Laser Beam Recorder (LBR).
Letter b
Self explanatory
Paragraph (3)
Self explanatory
Article 5
Self explanatory
Article 6
Self explanatory
Article 7
Self explanatory
Article 8
The name board as intended in this article must permanently be put up and must not be easily removed. In case a Business Agent has production facilities in separate places, a name board must be put up in each of them.
Article 9
Self explanatory
Article 10
The procurement of Unrecorded Optical Discs may be met by locally-made Optical Discs referred to herein cover all the activities of producing Unrecorded Optical Discs.
The procurement of Recorded Optical Discs covers the activities of molding, replicating, or multiplying creative works and that a license/permit from the Copy Rights Owner is needed.
Article 11
Self explanatory
Article 12
Paragraph (1)
The obligation to register machines and appliances applies to Optical Disc manufacturers, either those that have been in operation or those that are completely new.
Paragraph (2)
Transferring machines and appliances means transferring rights through sales purchase agreement, grant, inheritance, last will, written agreement or other causes justified by the existing law.
Article 13
Paragraph (1)
The periodic report on production activities means a quarterly report that must be submitted no later than the second week of the ensuing month.
Paragraph (2)
Self explanatory
Paragraph (3)
Self explanatory
Article 14
Self explanatory
Article 15
Paragraph (1)
The supervision of the Optical Disc industry is made periodically at least once in every 3 (three) months.
Paragraph (2)
Self explanatory
Paragraph (3)
Self explanatory
Paragraph (4)
Self explanatory
Article 16
Self explanatory
Article 17
The investigation is coordinated by the agency responsible for the production and circulation of Optical Discs as well as for Copy Rights.
Article 18
Administrative sanction covers not only criminal sanction specified in Law Number 19 of 2002 concerning Copy Rights, Article 72 paragraph (9), namely a maximum of 5 (five) year jail term and/or a maximum fine of Rp 1,500,000,000 (one billion, five hundred million rupiahs).
Article 19
Self explanatory
Article 20
Self explanatory
Article 21
Self explanatory
Article 22
Self explanatory