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Geographical Indication Application in Indonesia:
Opportunities and Challenges1)
Surip Mawardi2)
Introduction
As an archipelago, Indonesia consists of thousand islands where in each island potentially
produce specific product due to its geographical or ethnic influences. Reputation of
several specific and unique products from certain origin has been recognized widely in
the market such as Toraja coffee, Banda nutmeg, Java cocoa, Bali vanilla, Java Batik,
Muntok white pepper, etc.
WIPO (2003) mentioned that product differentiation will be an important marketing tool
in the coming global competition. As on trade mark, geographical indication (GI)
protection will play an important role in order to provide good image to consumers.
In Indonesia protection of GI is provided by under Marks Law No. 15 of 2001, which are
in line with TRIPs standards. GI protects a sign which indicates the place of origin of
goods, which due to the geographical environment, including human or the combination
of the two, gives a specific characteristics or quality to the goods produced therein.
Legally, a GI shall be protected upon registration where the application for registration
can be submitted by:
- An institution that represents the society in the area which produces the goods
concerned; or
- An institution that is given authority to do so, or groups of consumers of the
goods concerned.
However, if a sign, which should have been protected under GI, is in fact unregistered,
the protection of such sign is then based on source of origin. Source of origin also covers
protection for sign, which simply indicates the origin of the goods. Registration is not
pre-requisite for protection of source of origin.
Recently, none products from Indonesia have been protected by GI. The country is still
finishing up the government rule to implement GI protection.
This paper is aimed to discuss some aspects on the application of GI protection for such
product in Indonesia, especially its opportunities and challenges.
1) Presented at the “Seminar on Geographical Indications: A Land of Opportunities”,
Hanoi (Vietnam), 15 – 16 November 2005.
2) Indonesia Coffee and Cocoa Research Institute (ICCRI), Jalan P. B. Sudirman No. 90,
Jember 68118, Indonesia. Email: iccri@iccri.net, surip_mawardi@yahoo.com.
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The Need of GI Protection Indonesia: A Lesson from Toraja Coffee
Toraja coffee is one of the best specialty coffees in the world. The coffee is belonged to
Arabica group which is mainly grown by smallholding farmers in Tana Toraja or Toraja
land. Tana Toraja is a mountainous region located in the central of Sulawesi (Celebes)
island, one of the five biggest island in Indonesia. Administratively the region is
belonged to District Tana Toraja, South Sulawesi Province.
Tana Toraja region is inhibited by an ethnic of Toraja. The ethnic owns special language
and unique culture as well. So that Toraja can be a name of region or ethnic in Sulawesi
island of Indonesia. Growing Arabica coffee is one of the ancient traditions carried out by
Toraja ethnic. The centre of business activities site in the region, especially for tourism
and coffee trading, is Rantepao. That’s why Toraja coffee prior was well known as
Rantepao DP, which DP was attributed as processing type of Dry Process.
Coffee from Tana Toraja region sometime also mentioned as Kalosi coffee. Kalosi
actually is a name of village and also a name of market where coffee was mainly traded.
Kalosi was well known as coffee market in Enrekang District of South Sulawesi
Province. Northern part of the Enrekang District geographically is belonged to Tana
Toraja region. The coffee traded in Kalosi market was recognized as Kalosi DP in the
world market.
Sometime coffee traders mix the name of Toraja and Kalosi to mark Arabica coffee
originated from Tana Toraja region to be Kalosi Toraja or Toraja Kalosi. For instance, in
the specialty segment of the US market the coffee was recognized as Celebes Kalosi
Toraja. The coffee was the fifth rank highest price after Jamaican Blue Mountain,
Hawaiian Kona Fancy, Jamaican High Mountain and Kenya AA. In 2000 the price of
Celebes Toraja Coffee was 13.00 US$/lb at the US retail (Anonymous, 2000).
Early Reputation
A Japanese company of Kimura Coffee Co. Ltd. firstly introduced Toraja Coffee name
into Japan in 1934. In a part of a magazine which mentioning import and selling new
goods, written an advertisement concerning Toraja coffee as follow:
“In Celebes, an island of the Dutch East Indies there is a coffee which is produced in a
very low quantity. Its aroma and flavor is recognized as the best in the world, and it is
also said the quality is better than that of the famous coffee of Mandheling from Sumatra.
However, due to the very small quantity the coffee is not exported that only be honored
by such coffee lovers. This is TORAJA COFFEE, the import result of our shop”.
The Toraja Coffee which is having an excellent harmonic tastes blend of acidity and
bitterness, in fact was appreciated as the best Arabica coffee since the period.
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However, Arabica coffee produced by smallholding farmers from Tana Toraja was still
recognized as Rantepao DP and Kalosi DP in the world coffee trading until 1970’s as
mentioned in Table 1.
Table 1: Export data of Arabica coffee from Indonesia (1967 – 1968)
No Volume (kg) Value (1000 USD)
1967 1968 1969 1967 1968 1969
1 Sumatra/Sibolga 2.404.772 3.595.000 3.579.972 1.614.291 2.748.464 2.819.351
DP
2 Java WIB - 130.000 267.500 - 121.750 213.901
3 Rantepao DP 47.980 156.800 4.500 38.857 120.107 3.732
4 Kalosi DP 675.303 692.430 637.472 602.255 643.253 588.082
5 Arabica green 379.180 682.040 18.310 212.910 435.884 6.128
coffee SP
6 Arabica GB 24.000 165.616 40.180 16.825 109.850 25.407
Total 3.531.235 5.421.886 4.457.934 2.585.138 4.179.308 3.656.601
Source: Anonymous (1972).
Quality Improvement and Building Reputation
By 1974 a joint venture of Japanese and Indonesian company was established. The name
of the new company is PT Toarco Jaya. Toarco is abbreviation of Toraja Arabica Coffee.
One of the missions the company was to disclose again the excellent quality of Toraja
coffee as mentioned by Kimura Coffee Co. in 1934.
PT Toarco Jaya manages one Arabica coffee plantation in Tana Toraja, however the
company is also buying high quality wet parchment coffee beans from the smallholding
farmers as well. The continuation process of the parchment beans is carried out at the
processing unit of the company. Coffee quality control and its origin are strictly carried
out by the company in order to find premium quality either at the farmers and collector
levels or factory level. The main criteria used on the quality control are bean freshness
and cup taste.
Trade Mark Dispute in Japan
Since the first marketing of Toarco Toraja coffee in 1978, its imitation product was also
marketed in Japan. Key Coffee Co. along with Toshoku Ltd. has asked to register a
trademark of Toraja (also written in Japanese letter) to the Agency of Patent Registration
on 22 July 1974. The registration was announced on 21 February 1976 then fully
completed on 14 January 1977.
After launching, the popularity of Toarco Toraja coffee was being increased by time, if
there a company or a shop sold a product by using same trademarks, then Key Coffee Co.
informed that the right of the mentioned trademark was belonged to the company. Key
Coffee Co. also requested to the illegal trademark user to stop it.
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Along with the increasing of popularity of Toarco Toraja coffee in Japan, other coffee
business parties mentioned that the monopoly using of the name by Key Coffee Co. was
incorrect since Toraja is a name of geographical region. They asked Key Coffee Co. to
act in releasing its trademark right to all parties of coffee business in the world. Even
three coffee business associations have formally requested to the Japanese Authority,
Key Coffee Co. won’t to release the right due to the historical background of Toraja
coffee development.
Key Coffee Co. brought Avance Trading Co. to the Court of Urawa on 4 April 1997 due
to misuse of Toraja trademark. The company registered trademark of AVANCETORAJA
(also written in Japanese letter) in 1992. The company claimed that “Toraja is a name of
a geographical region and a noun”, therefore everybody is able to use the name legally!
On 24 December 1999 Key Coffee Co. and Avance Trading Co. agreed on three aspects
as follows:
1. Avance Trading Co. admitted that “Toraja” is a trade mark socialized by Key
Coffee Co.
2. Avance Trading Co. in using of “Toraja” trade mark must aware to high quality
product in order to maintain its good image,
3. Key Coffee Co. permitted Avance Trading Co. to use trade mark of
“AVANCETORAJA”.
Key Coffee has ever been on dispute too with Brooks Co. due to misusing of trade mark,
however the dispute also ended by reconciliation.
Other Using of Taraja Name on Trade Mark
In Holland Toraja coffee is marketed by using trade mark of “Toraja Prince”
(www.toraja-coffee.demon.nl/). The green beans is imported from Rante Pao via Ujung
Pandang to Rotterdam in special coffee containers. The roasting is done by Algra b.v. in
Zwolle who are third generation craftsmen in coffee roasting. Not the quick industrial
roasting process, but the hand controlled original method. This slow roasting process
takes about 20 minutes for one batch of 50 kilo’s. The roasting degree for the Toraja
espresso coffee is dark-brown and can be compare to the French roasting.
The famous Toraja coffee coffee is well known in Japan. The Japanese own some
plantation in Toraja and most of the first grade coffees are exported to Japan. One
plantation is happy to sell their first grade coffee to Holland. The name of Toraja Prince
is chosen because of the important role the owner of the plantation plays in social life in
the Toraja communities.
Counterfeiting in Indonesia
In spite of no available formal data, the highest price of Toraja coffee was mainly at the
period of mid 1980’s to 1990’s. The price had been stimulated by its reputation in the
world coffee market, especially in Japan. It was informally reported that counterfeiting of
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Toraja coffee by using Arabica coffee beans from other origins was conducted by several
coffee traders. In affect, the quality of Toraja coffee was inconsistence and even inferior.
Reputation of Toraja coffee was tainted by counterfeiting. Recently local price of Toraja
and Kalosi coffee is not as high as the price ten to fifteen years ago. By 2005 local price
of coffee bean in Toraja and Kalosi is cheaper than that of Arabica coffee in Kintamani of
Bali.
Progress on the GI Application in Indonesia
Up to now, GI protection has not been effectively applied yet in Indonesia. However,
several efforts have been conducted to learn the aspects of the application of GI
protection in the country.
After releasing the Law No. 15/2001 about mark, ICCRI in cooperation with CIRAD
started to study the possible application of GI protection on coffee since 2002. The
background of the study was mainly the dispute case of Toraja coffee in the world
market. The study was commenced at Kintamani highland of Bali, since the Arabica
coffee from the highland has also been recognized as geographic coffee (David, 1996).
The study consisted of identification of “terroir”, quality description, quality
improvement, relation between geographical factors and quality, sensory analysis, social
dynamic, area delimitation, preparing specification book and marketing. The progress of
the study will be presented in this seminar in a separate session.
A number of seminars and workshops on GI protection have been organized by
Directorate General of Intellectual Property Right, Ministry of Agriculture and several
universities. The events were very important to socialize the importance of GI protection
in Indonesia, because GI protection is a new system for the Indonesian.
At the moment, the most important work is preparing a draft of government regulation to
implement GI protection based on the Law No. 15/2001. The draft was prepared by a
team, which was assisted by CIRAD law specialist and GI specialist from INPI (France).
Recently the application of GI protection in Indonesia is more intensively discussed by
several institutions such as Ministry of Research and Technology, Department of
Agriculture, Department of Industry, Department of Trade, Universities and NGO’s.
Potential Products to Be Protected by GI in Indonesia
Soedarmanto (2005) from the Department of Industry and Trade has made a preliminary
identification on various products in Indonesia proposed to be GI. The identification was
based on criteria as follows:
1. The product at least has been recognized by the Indonesian,
2. The product already traded in the domestic market commercially,
3. The product is having potential to be promoted to increase market share.
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By using the criteria it was expected a protected by GI product can provide a significant
economic benefit.
Table 2 shows several products in Indonesia potentially to be protected by GI.
Table 2. Example of potential GI products in Indonesia
No Group of Name of product Specific characteristic Geographical
product origin
1 Agriculture Cilembu sweet Very sweet taste Cilembu village,
potato West Java
Malang apple Tropical apple, juicy, Malang District,
sweet and fresh taste East Java
Mandheling coffee Low acidity, full body, Noth Sumatra
(Arabica) rich aroma and flavor province
Toraja coffee Balance between Tana Toraja
(Arabica) acidity and bitterness, District, South
rich aroma and flavor Sulawesi
Gayo Mountain Medium acidity, Gayo Highland,
Coffee medium body, rich Central Aceh
(Arabica) aroma and flavor District, Aceh
(Sumatra)
Kintamani coffee Medium body, rich Kintamani
(Arabica) aroma and flavor, highland, Bali
lemony taste
Dampit coffee Full body, neutral taste Malang District,
(Robusta) East Java
Java cocoa Purple beans, fine Central and East
chocolate flavor, light Java Province
breaking color
Lampung black Rich spicy flavor, Lampung
pepper natural sun dried province
Muntok white Wash process pepper, Bangka island,
pepper natural sun dried Bangka &
Belitung
Province
2 Textile Trusmi batik Light background, Cirebon District,
cloudy form type, fine West Java
stripping, hand made
Pekalongan batik Rich of variation, more Pekalongan
contrast, colorful, hand District, Central
made Java
Solo batik Full symbolic motif, Solo District,
classic, calm color Central Java
Yogyakarta batik Red blackish Yogyakarta
background, spiritual Province, Central
sense Java
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Palembang songket Hand made, mixing Palembang
color, embroidered District, South
with bits of gold or Sumatra
silver tread, flora and
fauna background
Sumba cloth Woven cloth, dark blue Sumba island,
color, animal motif East Nusa
Tenggara
Province
Samarinda sarong Fine product, calm Samarinda
color, rich motif District, East
Kalimantan
Province
3 Handicraft Toraja wood carving Rich of motifs (sun, Tana Toraja
buffalo head, coq, line), District, South
dark color, natural Sulawesi
Jepara wood carving Mainly on teak wood, Jepara District,
flower and animal Central Java
motif, fine art, furniture
used
Bali wood carving Classic and dynamic Gianyar District,
motifs, rich variation, Bali Province
fine art, spiritual
background
Asmat wood carving Natural motif, Papua Province
expressionist style,
humanity
Java kris Fine mixing art of Central Java
metallurgy and wood Province
carving, magical sense
motif
Kasongan clay Fine clay product Yogyakarta
products (ceramic alike), animal Province, Central
motif, clay taken from Java
specific sites
4 Food and Jenang Kudus A kind of snack made Kudus District,
beverage of sticky rice, coconut Central Java
milk and brown sugar, Province
natural, sweet and
sticky taste
Bali wine Made of tropical grape Buleleng and
grown, traditional Jembrana
process Districts, Bali
Province
Dendeng Aceh Natural flavored dried Banda Aceh
beef, sun drying District, Aceh
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process, palm sugar Province
5 Art products Bali-Kamasan Two dimensional Kamasan village,
Painting painting, natural color, District
traditional style Klungkung, Bali
Province
Source: Soedarmanto (2005), modified by the author.
More potential products has not been identified yet such as Bali vanilla, Cianjur rice,
Probolinggo mango, Flores coffee, Flores cashew nut, Sumbawa honey, West Sumatra
cinnamon, Papua aloe wood, etc. Further identification is still need in order to have better
understanding on the name of product, type of product, background, processing, special
characteristics and geographical delimitation. The government, especially provincial
government, is expected more proactive on the GI protection. GI product provides
competitive advantage in the domestic market or global one.
Opportunities
Indonesia is a large country consisting of thousand islands and ethnics. The country is
also recognized as one the most important biodiversity source in the world. By the
background, product differentiation affected by geographic site, ethnic and bio source can
be found in the country.
Several products from Indonesia have been well known in the world market by using
geographical name, especially agricultural products.
GI product normally more expensive than that of regular product due to its quality
reputation, that the producers willing to maintain quality and supply.
Producer’s organizations, one of the main conditions for GI protection, already exist in
several origins,
The local government and community always pay positive attention on the promotion its
territory name along with the product originated therein.
Challenges
The concept of GI protection is a new system for the Indonesian community, they are
lacking on GI understanding.
GI products are facing on the marketing problems, especially to obtain premium price in
order to maintain quality, administrative works and social welfare.
Small producers and local traders in Indonesia, especially at the agricultural sector,
usually have not had good awareness yet on product quality and its consistency.
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Domestic consumers have not familiar yet with legal GI protected products, customer
education will take time.
Most of small producers have not been well organized, to empower them need
sustainable program and takes time.
Up to now government regulation following the Law No. 15/2001 has not been released
by the government yet.
Possible conflicts between new GI protected products and existing trade mark such as the
use of Toraja name as trade mark in Japan.
References
Anonymous. 1972. Statistik Kopi 1969 (Coffee statistic 1969). BPPB, BPS dan Biro
Hubungan Luar Negeri Deptan, Bogor, 127 p.
Anonymous. 2000. The US market for specialty coffee: Gourmet/Rare Origin/Estate,
organic, fair trade, shade grown. Fintrac, San Pedro Sula, 33 p.
David, K. 1996. Home coffee roasting, romance & revival. St. Martin’s Griffin, New York,
216 p.
Key Coffee Co. 2002. Perjalanan panjang usaha kopi di Tana Toraja (Long journey of
coffee business in Tana Toraja, translated from Japanense to Indonesian language). PT
Toarco Jaya, Rantepao, 95 p.
Mawardi, S., J. Avelino, G. de Taffin, J.J. Perriot, D. Sautier, M. Jacquet. 2004. Progress
of the study on Geographical Indications application in Indonesia: case of Bali-Kintamani
Arabica coffee. Workshop on Geographical Indication in Indonesia: a move forward,
Jakarta, 24 February 2004, 14 p.
Sudarmanto. 2005. Produk kategori Indikasi Geografis, potensi kekayaan intelektual
masyarakat Indonesia (GI catagorized products, IP potential for Indonesian community).
Dalam Kepentingan negara berkembang terhadap Hak Atas Indikasi Geografis, Sumber
Daya Genetika dan Pengetahuan Tradisional, Lembaga Pengkajian Hukum Internasional
FH UI, Depok, hal: 61 – 72.
Undang-undang Republik Indonesia Nomor 15 Tahun 2001: Tentang Merk. (Law of the
Republic of Indonesia No. 15 Year 2001 about Mark).
WIPO. 2003. Introduction to geographical indication and existing means of protection.
WIPO Asia and the Pacific regional symposium on the protection of geographical
indication, New Delhi, 18 – 23 November 2003, 25 p.***
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