Mexico City, May 5th 2025
The U.S. Trade Representative’s Special 301 Report is a pivotal document for anyone interested in global intellectual property (IP) protection and enforcement. This report, which has been issued annually since 1989, provides an in-depth evaluation of the state of IP protection in U.S. trading partners around the world. Countries are reviewed based on their compliance with international IP standards, and they are categorized into two main groups: the Priority Watch List and the Watch List. Countries placed on the Priority Watch List are considered to have significant and ongoing IP protection challenges that require immediate attention.
In 2025, Mexico was placed on the Priority Watch List, reflecting ongoing concerns regarding its IP enforcement practices, particularly in relation to the U.S.-Mexico-Canada Agreement (USMCA). This categorization highlights the areas where Mexico’s IP framework still faces challenges, but it also provides an opportunity to examine the progress the country has made in recent years and the steps it can take to strengthen its IP protections further.
What is the Special 301 Report?
The Special 301 Report is an annual document compiled by the USTR that evaluates the state of intellectual property protections and enforcement in key trade partner nations. It is a critical tool for highlighting where foreign IP laws, policies, and practices fall short of providing adequate protection for U.S. inventors, creators, and businesses. The report addresses a range of concerns, including piracy, counterfeiting, and inadequate enforcement of IP rights.
Countries placed on the Priority Watch List are expected to take immediate action to address the issues highlighted, while those on the Watch List are expected to make progress but with less urgency. Mexico’s placement on the Priority Watch List reflects the U.S. government’s concerns about persistent challenges that have yet to be fully addressed, despite the country’s ongoing efforts to improve its IP landscape.
Reasons for Mexico’s Placement on the Priority Watch List
Mexico’s placement on the Priority Watch List in 2025 stems from a combination of long-standing issues and newer challenges, particularly in relation to the implementation of the USMCA. While there have been significant legislative reforms in Mexico, there are still notable gaps in enforcement and implementation.
One of the most prominent concerns is the lack of criminal investigations and prosecutions related to trademark counterfeiting and copyright piracy. In the pasts years, these types of enforcement actions appear to have been non-existent, and the Attorney General’s Office has not provided any IP enforcement statistics for the last five years. This lack of activity is a significant issue, as robust enforcement is key to deterring IP infringement.
Another area of concern is Mexico’s slow progress in implementing regulations under the USMCA. Nearly five years after the agreement came into force, Mexico has not issued the necessary regulations for amendments to its Copyright Law and Industrial Property Law. These gaps have left many stakeholders uncertain about how their IP rights are protected, and the absence of clear regulations has hindered efforts to address counterfeiting and piracy.
The protection of pharmaceutical-related IP is also a point of contention, particularly regarding the linkage system and data exclusivity. While Mexico has made efforts to improve IP protections, these shortcomings remain significant barriers to ensuring adequate protection for U.S. companies operating in the pharmaceutical sector.
Progress and Positive Developments
Despite these challenges, Mexico has made notable strides in certain areas of IP protection. The country has undertaken several legislative reforms, including amendments to its Copyright Law and the passage of the 2020 Federal Law for the Protection of Industrial Property. These reforms, part of Mexico’s commitments under the USMCA, are a positive step forward in aligning the country’s legal framework with international standards.
Furthermore, Mexico’s National Institute of Industrial Property (IMPI) has been working to streamline patent examination processes through agreements with the United States Patent and Trademark Office (USPTO). These agreements, the Parallel Patent Grant and Accelerated Patent Grant, are designed to improve the efficiency of patent examinations, which is crucial for facilitating innovation and protecting the interests of both domestic and foreign entities.
In terms of IP enforcement, Mexico’s authorities have engaged in coordinated efforts with federal and local police to target counterfeit goods and piracy across the country since the second part of 2024. These efforts, under the strategy known as Operación Limpieza, have led to some significant seizures of illegal merchandise, particularly counterfeit goods originating from China. However, despite these efforts, the presence of counterfeit and pirated goods in certain markets remains a significant issue, and the lack of ex officio authority for Mexico’s National Customs Agency (ANAM) to seize counterfeit products complicates enforcement.
Moving Forward: Expectations and Opportunities
Mexico’s placement on the Priority Watch List in the 2025 Special 301 Report highlights the challenges the country continues to face in IP protection and enforcement. However, it also presents an opportunity to address these concerns and further strengthen its IP framework. By advancing the implementation of its USMCA commitments and reinforcing enforcement mechanisms, Mexico can make significant progress that benefits both domestic innovation and international partnerships.
An encouraging development is the ongoing collaboration between the Mexican Patent and Trademark Office (IMPI) and the Federal Commission for the Protection against Sanitary Risk (COFEPRIS), which marks a step toward better coordination in the pharmaceutical regulatory and patent linkage systems. This cooperation could help resolve long-standing issues around transparency, predictability, and data protection in the pharmaceutical sector.
In addition, Mexico is expected to soon issue long-awaited regulations to the Federal Law for the Protection of Industrial Property. These regulations are anticipated to clarify the practical application of key legal provisions, many of which stem from USMCA obligations. If effectively implemented, this regulatory framework, together with strengthened institutional coordination, could represent a turning point in the country’s efforts to modernize its IP system and address concerns raised by stakeholders.
The coming months will be critical in determining how Mexico translates these signals into policy and institutional action.
Sincerely,
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
Eduardo Castañeda
ecastaneda@basham.com.mx
Mariana Vargas
mvargas@basham.com
Santiago Zubikarai
sgonzalez@basham.com.mx
Mariana González
mgonzalezv@basham.com.mx
