Monday 30 August 2010

Assignable Service Marks of Professional Services

In our Indonesian Trademark Law (Law No. 15 of the Year 2001) it is provided under Article 41 that:

(a) Assignment of marks can be accompanied by the assignment of goodwill, reputation and other things related to or pertaining to such marks; and

(b) the rights in registered service marks, which are inseparable from the capability, quality or personal expertise of the relevant service provider can be assigned to third parties provided that there is a guarantee and indemnity for the quality of the services to be rendered by the assignee.

My thought/thinking is that if the quality of the services rendered by the service provider is inseparable from his/her own personal capability, quality or expertise, how can the service mark, which he has registered for promoting his/her own quality services, be assigned to any third parties?

In our Civil Code it is written that obligations deriving from an act that can be done by a certain person cannot pass to any other persons.

Thus, if a father is a lawyer and so is the child and they form a law firm, the quality of the professional services rendered by the father is naturally different from that of the child, although if the father is a registered capital markets legal consultant and so is the child, the obligations deriving from the professional services rendered by the father in the area of capital markets law can pass to the child who is also qualified to practise in that area of law. But the quality of the professional services rendered by the father and the child respectively is different.

It will be a different situation in which a person runs a securities company that provides services, for example the underwriting of negotiable instruments issuance to be listed on the stock exchange. The services rendered by the company are not related to the personal capability, quality and expertise of the founders of the securities company. In this case it is very logical if the service mark is assignable.

My question is, why should the law open a possibility for individuals working professionally to render services, of which quality is inseparable from his/her own personal capability, quality and expertise, to assign the service mark which is related to his/her professional services if that is very illogical? Although the law allows the assignment of such service mark provided that there is a guarantee and indemnity for the the same quality of the services, such provision will intrigue people to give such guarantee/indemnity which in reality they cannot perform and, therefore, will be susceptible to a lawsuit or criminal prosecution for giving false statement.

What do you think and how does your national legislation deal with such issue?

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