How to protect your intangible assets in Mexico

May 2015 | EXPERT BRIEFING | INTELLECTUAL PROPERTY

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The importance given to intangible assets can vary from one person, or company, to another – but it should definitely not, since it is well known that shortcomings in this area could comprise the most valuable part of a company. Therefore, regardless of the size of a company, the value of its intangible property should not be underestimated and should be protected from the moment a venture is born.

Not only is it not complicated to protect intellectual property in Mexico, but doing so could lead to a goldmine if the company is well positioned in the market. Consequently, protecting intellectual property should not be a questionable matter.

There are several forms of intangible property; however, in this article we address intangible assets that constitute the intellectual property of a person or company, particularly, copyrights, patents and trademarks.

Through copyrights, a company or person will be able to protect all works of authorship that comply with the requirement of originality. Through patents, it is possible for anybody to get protection of their inventions as long as they comply with the requirements of novelty and industrial application. Through trademarks, every person or company is entitled to protect names, designs, three-dimensional figures and composite trademarks that are distinctive and do not describe the nature or purpose of the product or service which they intend to protect.

In Mexico, there is no prohibition against accumulating rights; consequently, it is possible for rights holders to seek parallel or separate protection under trademark, copyright and patent laws. Deciding which course of action to take will entirely depend on the specific scenario and the rights holders’ convenience.

Copyrights

The Federal Law of Copyrights states, in Article 11, that a copyright is the recognition given by the State for all creators of literary and artistic works. This recognition is constitutive of rights, regardless of whether or not the work of authorship is registered. In fact, in Mexico, copyrights arise as soon as the original work of authorship is fixed in a tangible medium of expression.

Even though it is not necessary to register works of authorship, it is always advisable to do so in order to obtain the ideal means of proof that does not rely on the good faith of the author to facilitate enforcement procedures.

Patents

In accordance with the provisions of the Industrial Property Law, a patent is the exclusive right granted to an inventor to manufacture and use an invention for a certain period of time. An invention must be novel, the product of an inventive activity and should have an industrial application in order to be granted as a patent. The scope of patent protection is determined by the claims.

Granting a patent confers the inventor an exclusive right to use a patent or to manufacture, import or distribute the patented products within Mexico, either by the owner or by any duly authorised third party. The inventor or the owner of a patent has the right to claim damages in case of infringement by any third party who has been exploiting the patent without its consent.

It is important to bear in mind that under applicable law it is compulsory to use and work a patent once it is granted. Article 70 of the Industrial Property Law states that a patent must be worked in Mexico within three years from the granting of the patent, or within four years from the date of filing the application, whichever period elapses later. If the owner does not work a patent without justifiable reasons, it becomes subject to an obligatory licence.

Trademarks

Under applicable law, a mark is any visible sign that distinguishes the products or services to which it is applied, or is intended to be applied, from other goods or services. Mexico is a first-to-register jurisdiction and thus the exclusive right to use a trademark is secured only with its registration.

Article 89 of the Industrial Property Law stipulates that the following distinctive signs constitute a mark: (i) visible names and figures that are sufficiently distinctive and capable of identifying the products or services to which they are applied or are intended to be applied; (ii) three-dimensional shapes; (iii) trade names or corporate or business names; and (iv) the proper names of individuals, provided that they are not identical to a registered mark or published trade name.

Some visible signs, such as moving images and holograms, are not eligible for trademark protection. Article 90(I) of the Industrial Property Law states that: “denominations, figures or three dimensional shapes animated or changing forms, that are expressed in motion, even when visible, shall not be registrable as a mark”. Consequently, in Mexico for any party to have exclusive rights over a trademark, it must be: (i) a visible sign; (ii) inherently distinctive; and (iii) registered by the Mexican Institute of Industrial Property (IMPI).

Mexican law excludes sound, scent, taste and touch marks from trademark protection. These are commonly known as non-traditional marks. Notwithstanding the above, certain non-traditional marks are recognised under Mexican law, and are therefore enforceable in Mexico. These are: colours; letters and numbers; and three-dimensional shapes.

As mentioned above, Article 89 of the Industrial Property Law expressly states that three-dimensional shapes can be protected as trademarks and therefore can be registered before a corresponding authority. Distinctive signs, such as colours, letters and numbers, are not expressly mentioned under the provisions of this particular article; however, they can be considered to be protected under Mexican law. Article 90(V) states that such signs are not protectable if they are isolated, but implies that colours, letters and numbers with a distinctive character can be protected as marks in Mexico.

However, such marks must comply with certain requirements in order to be granted protection. For example, colours, numbers and letters must be accompanied by additional elements such as signs, designs or names that provide them with sufficient distinctiveness in order to obtain protection in Mexico.

The main problem for owners of unregistered marks, under Mexican law, is that their signs are vulnerable to infringement, since only signs that are registered within IMPI are afforded full and effective protection. As a result, unregistered non-traditional marks can be used by any third party, due to the fact that no individual or entity has the right to their exclusive use. Under these circumstances, trademark owners must seek out alternative means of protection in order to prevent third parties from reproducing or imitating their rights.

For instance, sound marks can be eligible for copyright protection under the Federal Copyright Law. Although some sound marks are formed of commonly used sounds or a piece of music, Article 13 of the Federal Copyright Law states that copyright protects all works that have an equivalent nature to those expressly mentioned in the Federal Copyright Law.

Another form of protection against infringement with regard to smells, scents, tastes and textures falls within the industrial and trade secrets area, whereby the formulae of smells, scents, tastes or textures can be preserved as confidential and thus may be enforceable by executing confidential agreements with parties that have access to them.

Trade secrets are regulated under Article 82 of the Industrial Property Law, which sets out the main criteria of what information must contain, in order to be considered as a trade secret.

Although the Industrial Property Law does not expressly regulate distinctive signs such as sounds, scents, tastes and textures, this does not mean that there is no course of action available against alleged infringers of such signs.

In the event any third party reproduces or imitates a distinctive sign, under applicable law, this constitutes an act of unfair competition, even if that sign has not been registered with IMPI and therefore is not enforceable by law.

Article 213(X) of the Industrial Property Law states that an “administrative infringement” constitutes the performance of an act in the course of industrial activities, or trade, that confuses, misleads or deceives consumers by causing the erroneous belief or assumption that: (i) a relationship or association exists between a given establishment and a third party; (ii) products are manufactured according to specifications, licences or authorisations from a third party; (iii) services are rendered or products are sold according to authorisations, licences or specifications from a third party; or (iv) products originate from a region or locality that is different from their true place of origin, in order to mislead the public as to their geographical origin.

Following this line of thinking, if a rights holder demonstrates that its goods or services are clearly identified by consumers and that those are being sold or offered without their authorisation, this constitutes an administrative infringement and consequently a conduct prohibited under Mexican law.

Conclusion

Despite the fact that Mexico is a mixed system, in which both registration and use constitute rights, in order to facilitate enforcement procedures it is always advisable to seek protection through registration.

Although under applicable law there are several measures to take without registering against possible infringers, the benefits of seeking protection relies on the fact that the exclusive right to use a distinctive sign, patented invention or work of authorship within Mexico corresponds to the owner, and, consequently, such protection will prevent any third party from violating the owner’s rights.

In addition, this protection will grant the owner the right to initiate infringement actions against any third party who reproduces or imitates any protected intangible asset.

Ana Soto and Raul Ortiz-Mena are associates at Uhthoff, Gómez Vega & Uhthoff. Ms Soto can be contacted on +52 (55) 5533 5060 or by email: asoto@uhthoff.com.mx. Mr Ortiz-Mena can be contacted on +52 (55) 5533 5060 or by email: rortizmena@uhthoff.com.mx.

Ana Soto and Raul Ortiz-Mena

Uhthoff, Gómez Vega & Uhthoff