Intellectual Property

President Joko Widodo enacted Government Regulation Number 24 of 2022 on Implementing Regulations of Law Number 24 of 2019 on Creative Economy (“ GR 24/2022 ”) on July 12 th , 2022, as the implementing regulation of Law Number 24 of 2019 on Creative Economy (“ Law 24/2019 ”). GR 24/2022 is enacted to make it easier for creative economy actors to obtain funding from bank or non-bank financial institutions by using intellectual property as debt guarantee . This article will discuss this further.


A. Definition of Intellectual Property

Article 1 GR 24/2022 defines that Intellectual Property is wealth that arises or is born due to human intellectual ability through creativity, taste, and initiative which can be in the form of works in the fields of technology, science, art, and literature so that it can be interpreted that intellectual property can be in the form of music, songs, films, books, paintings, technology applications and YouTube contents.


B. Intellectual Property as Object for Debt Guarantee

Through GR 24/2022, the Indonesian government provides support to creative economy actors and Micro Small Businesses to be able to develop as they are the foundation of national economic growth. Article 4 of GR 24/2022 stipulates that the Indonesian government facilitates Intellectual Property-based financing schemes through bank and non-bank financial institutions for creative economy actors who have difficulty obtaining funding from bank and non-bank financial institutions. In this case, Article 9 of GR 24/2022 further stipulates and guarantees that Intellectual Property can be used as an object of debt guarantee. Article 10 of GR 24/2022 stipulates the conditions under which Intellectual Property can be used as an object for debt guarantee:

  1. Intellectual Property must be registered with the ministry that administers government affairs in the field of law; and
  2. Intellectual Property must be managed independently and/or such rights have been transferred to other parties.


Furthermore, Article 9 Paragraph 2 of GR 24/2022 regulates the forms of debt guarantee objects:

  1. fiduciary guarantee of intellectual property;
  2. contracts in creative economic activities, and/or
  3. billing rights in creative economic activities.


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C. Requirements for Intellectual Property-Based Financing Scheme Application 

In applying for an Intellectual Property-based financing scheme, Article 4 of GR 24/2022 stipulates several requirements that must be met by creative economy actors, as follows:

  1. Creative economy actors must submit a funding proposal;
  2. Creative economy actors have creative economy businesses;
  3. Creative economy actors have an engagement related to the Intellectual Property; and
  4. Creative economy actors have a registration letter or Intellectual Property certificate.


D. Assessment of Intellectual Property as Bank Guarantee

If the requirements for the funding application through the Intellectual Property-based financing scheme are fulfilled, the bank and non-bank financial institution carries out several stages of verification of businesses and Intellectual Property certificates belonging to the creative economy actor, and provides an assessment of the Intellectual Property that will be used as the object for debt guarantee as provided in Article 8 of GR 24/2022 through the following stages:


  1. verification of creative economy business;
  2. verification of the registration letter or Intellectual Property certificate used as guarantee which can be executed in the event of a dispute or non-dispute;
  3. assessment of Intellectual Property that is used as an object of debt guarantee;
  4. disbursement of funds to creative economy actors; and
  5. receipt of refunds from creative economy actors in accordance with the agreement.


Through these stages, one of the important stages that must be passed by creative economy actors as regulated in Article 8 letter c of GR 24/2022 is the assessment of Intellectual Property that is used as an object for debt guarantee by using a number of approaches as follows:


  1. cost approach;
  2. market approach;
  3. income approach, and/or
  4. other assessment approaches in accordance with applicable assessment standards.


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E. Urgency of Further Study


Considering that GR 24/2022 will enter into force 1 (one) year from the date of enactment, the implementation of this regulation needs to be studied further because a debt guarantee in the form of Intellectual Property has not been fully regulated by the regulator, in this case, the Financial Services Authority (“ Otoritas Jasa Keuangan , OJK ”) and Bank Indonesia so that funding by using Intellectual Property as an object for debt guarantee is still difficult to rely on. The Chief Executive of Banking Supervision of OJK states that the implementation of this regulation needs to be studied further in terms of valuation, the availability of secondary markets, assessment for the liquidation of Intellectual Property and the legal infrastructure for the execution of Intellectual Property so that the potential for Youtube content and songs to be used as debt guarantee for bank loans depends on the capacity and the level of risk (risk appetite) that can be accepted by the bank.




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