The TPP and patent rights in Mexico

May 2014 | EXPERT BRIEFING | INTELLECTUAL PROPERTY

financierworldwide.com

Negotiations for a new Free Trade Agreement (FTA) among some economies in the Pacific Rim are on the way. Countries taking part in the talks include the US, Japan, Mexico, Canada, Australia, Malaysia, Chile, Singapore, Peru, Vietnam, New Zealand and Brunei Darussalam. Taiwan, South Korea, and doubtfully China, have announced interest in participating. It is expected that other countries in the region may join the Agreement, if eventually signed. The current negotiating economies are said to account for about 40 percent of the global Gross Domestic Product.

As with most contemporary FTAs, the TPP contemplates an IP Chapter, wherein several dispositions regarding IP rights are to be set for traditional IP figures such as patents, trademarks, copyrights, industrial designs, plant variety rights, and other perhaps less heard topics such as geographical indications, trade secrets, data protection, internet service provider liability, traditional knowledge and folklore.

Negotiations have received criticism from academics, analysts, media and the general public in many countries due to the secrecy under which the talks have been taking place, despite justifications from negotiating governments explaining that some measures of discretion are needed to preserve negotiating strength and to encourage parties to be willing to put issues on the table that they may not otherwise. Accordingly, the comments expressed in this article come from information made public via secondary sources and are intended to provide a general idea of possible dispositions in patents rights that might impact the Mexican market.

Possible impact on the Mexican patent system

One positive issue from the TPP is the encouragement of cooperation to improve quality and efficacy among the parties’ patent systems. By sharing search and examination results with other participating offices, the window would be open for Mexico to accelerate prosecution and arguably eliminate backlog, hopefully providing a better service to users.

Harmonisation of patentability requirements might also be seen as a positive aspect, except that there are fields for which Mexico has a tradition of not allowing patents – for example, patents for animals; diagnostic, therapeutic and surgical methods for the treatment of humans or animals; methods of doing business; and pure software. If dispositions on these topics are set in the final draft, it would be expected that they cause intense internal debate as to the practicability of actually granting patents thereon.

Leaked texts indicate that opposition to the grant of a patent might be implemented by the TPP. If so, Mexico would have to modify its internal procedures to permit opposition by third persons to grant patents during prosecution. Attempts to establish an opposition procedure in Mexico by internal legislative bills have failed in the past; the TPP might cause the opposition to grant patents to become a reality, with both positive and negative impacts for the local patent system, but certainly some reluctance from patent applicants.

The prosecution of patent applications is open for public inspection in various countries but not in Mexico. The TPP might compel Mexico to establish public inspection of patent prosecution, which might signify a big change in the system as currently only bibliographic data and the abstract of the invention is officially made public before a patent is granted. The change, however, seems to be required in order to give certainty to players and match local practice with that of some of Mexico’s major commercial partners, such as the US and the EC.

Perhaps one of the hottest topics in the TPP is patent term adjustment. Currently, Mexico grants patents with a term expiring 20 years after the filing date. Secondary sources indicate that there is the intention in the TPP to compensate unreasonable delays that occur in the granting of the patent, at the patent owner's request, by means of adjustment of the patent term, unless the delay is attributable to the applicant. In the pharmaceutical field the TPP seems to also propose to compensate curtailment of the effective patent term as result of the marketing approval process, for example, sanitary registration.

If any kind of patent term adjustment is actually introduced by the Mexican government signing the TPP, opposition from a plurality of players and the general public would be triggered. A tension between patent owners and other interested parties has played an important role in the Mexican patent system for at least the past 20 years. An unsteady but seemingly compromised situation has been reached with the current 20-year patent term framework which includes measures in the marketing approval to try to prevent infringement of patent rights by the generic industry. A change introducing patent term adjustment would undoubtedly result in a rearrangement of the situation, which may imply intense litigation.

Finally, another patent related issue in the TPP is data protection for sanitary approval of pharmaceutical, biotechnological and agricultural chemical products. The innovative industry seems to be strongly pushing dispositions for preventing other parties to use data generated to obtain or renew registration of their products without consent. Mexico has agreed to provide protection for such data, at least in the pharmaceutical field in a previous FTA (NAFTA-1994). However, from the innovators’ point of view, actual enforcement of such protection has proven ineffective. The term for protection in each field seems currently under discussion; however, it also seems there would be circumstances in which data protection would extend beyond the related patent term. If so, similar concerns to those already outlined above for patent term adjustment would arise.

Conclusion

Mexico is an active negotiating party of the TPP Agreement. The Intellectual Property Chapter of the Agreement seems to contain a plurality of dispositions addressing, or related to, patent rights. If signed, some of these dispositions would impact the Mexican system, making it necessary to introduce deep changes for complying with the obligations, some of which are seen as necessary and generally beneficial. Some might be controversial and subject to discussion, and others might trigger legal issues which may need to be decided by the courts. In any case, the fact that Mexico has been given the chance to participate in the talks before reaching a final draft is undoubtedly an opportunity to try to put some of its internal concerns on the negotiating table.

Karla Islas is a patent subdirector and Victor Garrido is a technical department manager at Dumont, Bergman, Bider & Co. S.C. Ms Islas can be contacted on +52 (55) 5322 6230 or by email: kislas@dumont.com.mx. Mr Garrido can be contacted on +52 (55) 5322 6230 or by email: vgarrido@dumont.com.mx.

Karla Islas and Víctor Garrido

Dumont, Bergman, Bider & Co.