BASHAM NEWS

NEW FEDERAL LAW FOR THE PROTECTION OF INDUSTRIAL PROPERTY.

Mexico City, July 9, 2020.

On July 1, 2020, the new Federal Law for the Protection of Industrial Property ("Ley Federal de Protección de la Propiedad Industrial") was published in the Official Gazette of the Federation ("Diario Oficial de la Federación").LFPPI"), which will become effective on November 5, 2020.

1.General

1.a. The Mexican Institute of Industrial Property ("Instituto Mexicano de la Propiedad Industrial") ("Instituto Mexicano de la Propiedad Industrial").IMPI"), as administrative authority, may:

Setting fines, requiring their payment and collecting the resulting tax credits.
Demand payment of unpaid tax credits, through the administrative enforcement procedure, in terms of the Federal Tax Code.
Payment of damages caused in administrative declaration proceedings.
Request assistance from the federal, state or local public force, civil or armed institution, in order to comply with rights enforcement determinations.

1.b. Regulation on submission of applications through electronic means.

- Electronic documents with the use of an advanced electronic signature or other means of identification will produce the same effects as those signed by handwriting and will have the same probative value.

1.c. The New Law does not include the "Reinstatement of Rights" for errors attributable to the Applicant. For example, late payment of annuities, among others.

Inventions

2.a. Patents

It includes the protection of new uses of substances, compounds or compositions included in the prior art, which were not contemplated by some of the departmental coordinating departments for substantive examination.
The definition of essential technical characteristics is established, being those necessary for an invention to solve the technical problem. Said definition corresponds to concepts adopted based on the European Patent Law.
The non-patentability of cloning procedures, genetic modification in animals or for the development of a human being and the use of human embryos for industrial or commercial purposes is clarified. However, the protection of biological material that has been modified by means of a technical process is allowed.
The premise of the "Bolar Clause" is included, whereby a third party may use, manufacture, offer for sale or import a product with a patent in force, to generate tests, information and experimental production with the purpose of obtaining sanitary registrations of medicines in order to commercialize them when the patent expires, from the filing of the patent application and during the entire time it is in force.
A third party may use a patent during the rehabilitation period.
A change is proposed in the regulation of the divisions, within which the divisions presented "voluntarily" are specified, which must be presented as a whole and in a single exhibition, excluding the possibility of presenting divisional applications in cascade unless the Institute considers it appropriate or so requires.
When as a result of the division an invention or a group of inventions has not been claimed, these may not be claimed again in the initial application or in the application that gave rise to the division, as the case may be.
Within the new regulation of divisional applications, the filing of applications within two months of the granting of the main application is contemplated.
It is hereby repealed that the computation of time periods shall run as from the business day following the expiration of the two-month period provided for.
A patent shall not be granted in respect of subject matter that is already protected by another patent or whose essential technical characteristics are a non-substantial variation of the subject matter covered by the patent, even if the applicant is the owner of the first right.
The Institute shall make a final decision on the grant or refusal of the patent applied for, once the term to comply with the requirement formulated has elapsed, provided that the application has not been abandoned or the applicant has not withdrawn the same.
The limitation of the right conferred by a patent is established for the purpose of enabling substantive corrections without such corrections being intended to extend the protection conferred.
The new Law includes the biannual publication of the list of patents related to inventions susceptible of being used in allopathic medicines, which was included in the Regulations of the Law still in force.

The complementary certificate to adjust the patent term is established for cases in which the patent granting procedure exceeds 5 years from the filing date, being this directly attributable to the Institute due to unreasonable delays.
- Within the 5-year term, the time required for the resolution of the formal examination, the actions or omissions of the applicant tending to delay the procedure or those beyond the control of the Institute, as well as the periods attributable to acts of God or force majeure, will not be taken into account.
- The application for a certificate must be made at the time of payment of the final fees for the grant of the patent and may be requested only once.

2.b. Utility Models

The term is modified to have a total of 15 years of protection.
The limitation of the right conferred by a utility model is established for the purpose of enabling substantive corrections, without such corrections being intended to extend the protection conferred.

2.c. Industrial Designs

Industrial designs of an animated sequence or in an animated graphic interface are allowed.
It establishes that the elements that are not part of the claimed industrial design shall be identified preferably with broken lines, blurring, shading or outlines and indicate it in the description.
Conditions of the inventive design concept are established.
The limitation of the right conferred by an industrial design is established for the purpose of enabling substantive corrections, without such corrections being intended to extend the protection conferred.

2.d. Layout Diagrams of Integrated Circuits

Further regulation is established with respect to the exclusive right of exploitation for layout-designs, with respect to their reproduction, importation, sale or distribution.

Industrial Secrets

The new law for the protection of industrial secrets will help to clarify its purpose and scope of protection, as well as to facilitate its exercise and increase the risks for possible infringers.
It substantially increases fines for the misappropriation, use or disclosure of trade secrets. It also makes it easier to obtain damages for such misconduct and creates new procedural avenues to enforce trade secret rights.
The new law also clarifies some exceptions to trade secret misappropriation such as independent creation and study of existing products on the market.
The obligation of companies to protect the confidentiality of their information with appropriate measures in order to be able to access the protection conferred by the industrial secret remains.

Trademarks, Geographical Indications and Appellations of Origin.

4.a. Marks

Validity of trademarks

The validity of trademarks, commercial notices and trade names shall be counted from the date of registration (grant). This provision shall apply only in relation to trademarks granted after November 5, 2020.

Products/Services that are not misleading and free of bad faith.

When filing and renewing a trademark, it must be declared that the goods/services are not misleading and there is no bad faith.
In the event that the competent authorities determine that such products/services violate any law, IMPI may initiate a nullity action against the registration of the trademark.

Declaration of use

It is clarified that the third year declaration of use will only apply in relation to trademarks granted after August 10, 2018.
Coverage of branded products/services will remain only for those whose use has been declared.

Grounds for Trademark Objections

The previous law established that geographical indications and appellations of origin could not be registered as trademarks. The new law establishes that not only identical signs, but also signs similar in degree of confusion to geographical indications and appellations of origin will be objected.
Reservations of rights to exclusive use, such as fictitious, symbolic and human characters, as well as titles of publications, cannot be registered as trademarks, unless requested by the owner of such reservation or a third party authorized to do so.

Bad faith

The definition of bad faith has been limited. Bad faith is now understood as "having applied for the registration of a sign with the purpose of obtaining an undue benefit or advantage to the detriment of its legitimate owner".

Letters of consent

Letters of consent will be acceptable not only in relation to confusingly similar marks, but also in relation to identical marks.

Trademark and opposition proceedings

After the examination of a trademark, the examiner will issue a single oficio including the correction of formal requirements, citing substantive objections and informing about any opposition filed against the application. Under the repealed law, two types of official letters are issued. Now under the new law it will be only one examination and one oficio.
Oppositions must be answered together with the response to formal and substantive objections. Therefore, the deadline for replying will be two months instead of one. This period may be extended.

4.b. Well-known and famous trademarks

Elimination of certain requirements for the application for the Declaration of Well-Known and Famous Trademarks. Specifically, with respect to confidential information, such as financial and investment data.

4.c. Certification Marks

Cancellation grounds are included for Certification Marks.
Only chambers and associations of manufacturers and producers, federal entities and local authorities in whose territories the products are produced may apply for a Certification Mark for a geographical indication.

4.d Geographical Indications and Appellations of Origin

Geographical Indications protected as Certification Marks are no longer the property of the Federation.
Requirements are established to apply for either the Declaration of a Designation of Origin or a Geographical Indication.
A declared Appellation of Origin must have a specific regulation (Norma Oficial Mexicana-NOM).
A Declared Geographical Indication must have specific Rules.
The Mexican Institute of Industrial Property will be responsible for authorizing Geographical Indication Certification entities and, therefore, the new law establishes the characteristics and requirements that interested entities must comply with.

5. Actions of Nullity, Forfeiture and Infringement

5.a. Nullity Actions

Partial nullity of a patent, utility model, industrial design can be requested.
It is also possible to request the partial nullity of a trademark and commercial notice producing effects retroactively to the time of its granting.
The invalidation of a trademark shall not be admissible when the opposition proceeding has been filed and the arguments and evidentiary material are the same as those presented in the opposition, and there is a final decision.

5.b. Forfeiture Actions

Partial revocation of a trademark may be requested for products that are not in use. The effects of revocation will be effective at the time of the final resolution.

5.c. Infringement Actions

Infringement of trade secrets is added.
A provisional measure is added for the cancellation of content on the Internet or through virtual, digital or electronic media, including those that may arise in the future.
It includes the possibility of applying border measures for goods in transit.
The possibility of closing an establishment when the imposition of a provisional measure is not sufficient to prevent the violation of rights and definitive closure as a sanction for violation of industrial property rights is incorporated.
The measures adopted in these proceedings may be lifted at IMPI's discretion, regardless of whether a counter bond is exhibited by the alleged infringer.
IMPI will have, among other powers: to impose provisional measures ex officio; to destroy insured goods; to impose and collect fines; to conduct a conciliation procedure regarding administrative infringements; and to determine the payment of damages.
Powers are granted for IMPI to determine and impose damages for violations of a right.

6.Action for claiming damages

The holder of a right may claim the payment of damages in two ways: before a civil, local or federal court, by means of a direct civil action, or before the IMPI, by means of an incident, and it is not necessary to obtain a definitive declaration of infringement in order to request this compensation as was previously the case.
In case of counterclaiming the nullity of the patent, registration or publication, the civil court will suspend the trial until the respective resolution of the counterclaim before the IMPI.
In order to prove damages, either before a civil court or before the IMPI, it is necessary to demonstrate the wrongful act or liability, as well as the causal relationship and the damage produced.

Criminal Actions

The concept of recidivism in administrative infractions of the Law, which was considered a crime, is eliminated.
The definition of trademark counterfeiting and how to prove it is included.
The offenses related to industrial secrets are modified.

The partners of the intellectual property area are at your disposal for any questions or comments you may have.

A T T E N T A M E N T,

Martin Michaus

mmichaus@basham.com.mx

Eduardo Kleinberg

kleinberg@basham.com.mx

Adolfo Athié

aathie@basham.com.mx

Claudio Ulloa

culloa@basham.com.mx

Juan Carlos Hernández

jhernandez@basham.com.mx