We all know Ikea. It is a Swedish based retailer of sleek modern designed Scandinavian style furniture, accessories, storage options, lighting, decor products, kitchen appliance and more. Ikea registered its trademark in Indonesia in 2010.

But Ikea received a big surprise when it opened its first store in Indonesia (in late 2014) when it discovered that it was not the only Ikea in town.
Indonesian rattan furniture company PT Ratania Khatulistiwa registered its Ikea trademark in December 2013. It’s an acronym of Intan Khatulistiwa Esa Abadi, which refers to the rattan industry.

TWO IKEA’s IN TOWN—WHICH ONE HAS THE RIGHTS TO THE NAME IKEA?

The Indonesian firm (Intan Khatulistiwa Esa Abadi) brought its case to the central Jakarta district court in mid-2014, when Ikea was building its first store in Indonesia. The district court ruled (in September 2014) that the trademark was owned by Ratania and ordered Ikea to stop using its own name.

The new Ikea was able to demonstrate to the court that Ikea (the Swedish retailer), had not actively used its mark in Indonesia for commercial purposes for three consecutive years.

This case went all the way to Indonesia’s Supreme Court.

THE DECISION OF INDONESIA’S SUPREME COURT

In 2015, Indonesia’s Supreme Court confirmed that Ikea (the Swedish retailer) marks were, in fact, subject to cancellation due to non-use and that PT Ratania Khatulistiwa’s registration for the mark was valid.

It is noteworthy that a Supreme Court spokesman said that the ruling was not unanimous. One of the three judges on the panel argued that the trademark law could not be applied to a company the size of Ikea, which is much bigger than the plaintiff, Ratania.

NON- USE OF A REGISTERED TRADEMARK LEAVES THE MARK VULNERABLE TO CANCELLATION

The legal framework surrounding this issue varies across the world. In the US, non-use of a mark for three consecutive years establishes a rebuttable presumption of abandonment of the mark (even if the mark is registered). . In some European countries, the period of non-use is five years. In other countries, for example, Australia, Japan, South Korea, Canada, China, and Russia, trademark registrations are vulnerable to cancellation after only three years of consecutive non-use. These time thresholds can be applied regardless of any future intent (of the holder of the mark) to use its mark.

In the US a trademark holder is allowed to make a showing that there is a special circumstance surrounding non-use of a mark under TMEP 1604.11 to rebut the presumption of abandonment. There are several excusable reasons for non-use, including the mark holder engaging in ongoing negotiations with distributors, the sale of a business, a trade embargo, or other circumstances beyond the owner’s control. Additionally, a mark holder can submit documents and testimony in
Generally an action, by a third-party petitioner is required to cancel a mark (criteria for cancellation based on non-use vary considerably by country).

Given the fact that, in most countries, the grounds for abandonment do not take into account the trademark owner’s intent as to the future use of the mark, it is imperative for a mark owner to ensure that its mark is used in each country wherein it has (or in the future plans to have) a commercial presence.

IKEA, the Swedish retailer, is reported to be still operating its Jakarta store under its IKEA mark. It will be interesting to see what its next steps will be to further its expansions plans in Indonesia.