Have you ever seen or even bought Starbucks brand coffee drinks, but in ready to drink cans at affordable prices at minimarkets? Yes, many say that this canned version is the “BPJS version of Starbucks” because Starbucks products are known to have quite expensive prices in its class. However, this canned version of Starbucks is very affordable, around Rp14,900. Investigated, it turns out that the Starbucks brand canned coffee is indeed produced by Nestle. Reporting from Starbucks Stories & News on July 26, 2021, Starbucks Corporation and Nestle collaborated to bring Starbucks coffee drinks in ready to drink packaging to the Oceania, Latin America and Southeast Asia markets, including Indonesia in 2022. Then the question arises, how can Nestle produce drinks using the Starbucks brand? Here is the explanation.
A Glimpse of Starbucks and Nestle Collaboration
On August 28, 2018, Nestle and Starbucks Corporation inked a deal that gives Nestle the perpetual right to market Starbucks’ Consumer Packaged Goods and Foodservice products globally, beyond the company’s coffee shops. Through this alliance, the two companies work closely together on roasted and ground coffee, whole bean, and instant and portioned coffee lines. Starbucks and Nestle collaborate to bring Starbucks coffee drinks to the Oceania, Latin America and Southeast Asia markets. On October 17, 2022, the two companies announced the expansion of the Starbucks At Home and Starbucks Ready-To-Drink (RTD) product ranges in Indonesia. This is a continuation of the partnership that was previously approved in 2018. There are at least two main products that are the mainstay for consumers to mix independently. The first is Starbuck Roast & Ground, aka coffee powder with various levels of roasting. The other is a capsule product with Cappuccino, Americano, and Espresso variants that can be used in Nescafe Dolce Gusto coffee machines. In order to reach younger consumers, the two also agreed to work on the ready-to-drink coffee drink business in two variants, namely frappucino and doubleshot. The product range is available in a number of premium retail outlets and minimarkets, as well as on e-commerce platforms in Indonesia. “These new products are expected to drive the growth of the dynamic young consumer segment through a range of innovative and customized coffee drinks,” said Sherif Hani, Country Business Manager, Coffee Nestle Indonesia. “We believe these products will be able to attract new consumers, and create fun moments.”
Brand License Agreement on Starbucks – Nestle Collaboration
The cooperation between Starbucks and Nestle is based on the Trademark Agreement owned by Starbucks which conducts a Trademark License Agreement to be used by Nestle. It should be noted that based on Article 1 number 5 of the Trademark Law, the trademark owner has trademark rights as rights granted by the state to the owner of a registered trademark by using the trademark itself or giving permission to other parties to use it. This permission granted is what is referred to as a Trademark License. In short, the Trademark License is a permit granted by the Registered Trademark Owner to other businesses to use the trademark of its products to be marketed based on a written agreement. Thus, registered trademark users (license) do not need to worry about the emergence of a problem in the future because of the use of the brand used to market a product with the brand. However, a trademark license agreement is not a transfer of rights to a registered trademark, but only permission granted by the trademark owner to another party. The licensor of a trademark has the obligation to guarantee the use of the mark from legal defects or claims from other parties, conduct guidance and supervision of the quality of the licensee’s production, request approval to the licensee to submit a request for removal of the mark to the DJKI, and demand the cancellation of the license agreement on the grounds that the licensor does not carry out the agreement. On the other hand, the licensor also gets rights in the form of royalty payments in accordance with the agreement, and can still use its own registered trademark or grant a license to third parties to use the trademark.
What are the Terms of the Trademark License Agreement?
Keep in mind that the preparation of a trademark license agreement must not violate the provisions of Article 6 of Government Regulation No. 36 of 2018 concerning the Recording of Intellectual Property License Agreements (PP 36/2018). An additional note is that this agreement must be explained in detail, especially regarding the rights and obligations of the parties, royalty payments and termination of the agreement, and also regulates who is responsible for recording the license to the DJKI, because this is mandatory so that later it does not cause disputes between the parties.
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Then the important point of the license agreement in order to have legal force is that it must be recorded through the Minister. If this is not heeded, later in the event of a dispute between the parties, this trademark license agreement has no legal effect to third parties.
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So, are you also interested in running a partnership like Starbuck and Nestle? It is undeniable that the more parties that work together, the more people will recognize your brand. In fact, you can also involve competitors in this collaboration to create a brand or just a new nickname for your new product innovation. So in fact, giving partial use of the brand is not a bad thing. But keep in mind, brand licenses can only be run based on brand agreements. This is as a legality between the two parties and a medium to involve the government or the Directorate General of IP in overseeing the use of your brand. Well, for KH Pals who currently have a business and plan to cooperate with other parties in terms of brand licensing, you can consult first with Kontrak Hukum. We can help you to record a brand license agreement with a competent and officially registered IPR consultant, so that it is guaranteed to be legal and safe. For service information, visit the KH Services – Brand License Agreement page. Or if you have other business needs, please consult for free at Ask KH or via direct message (DM) to Instagram @kontrakhukum.
