REFORMS TO THE MEXICAN INDUSTRIAL PROPERTY LAW, CONCERNING DISTINCTIVE SIGNS

After months of meetings between the different Mexican Law Associations and the corresponding Authorities, on April 3rd, 2018, the Mexican Congress approved the amendments to the Mexican Industrial Property Law concerning distinctive signs, amendments that were published in the Mexican Official Gazette on May 18th, 2018. These amendments will come into effect on August 10th, 2018, i.e. after 60 working days of their publication.

Within these amendments, Congress approved the inclusion in our law of some legal figures that where not previously contained, having our law reach a similar criterion of foreign countries and our IP law becoming more advanced vis-à-vis other developing countries.

The amendments in comment include the following points:

1.The definition of “Trademark” was modified in order to include “Non-traditional trademarks”, such as scent, sound and holographic marks and is also including the protection of “trade dress”.

2.The “Secondary Meaning” doctrine has been introduced. As we know, secondary meaning arises when consumers can identify a descriptive trademark with a certain good or service over time.
When this happens, a descriptive term not eligible to registration due to its lack of distinctiveness, can achieve trademark status after sufficient use has been made to prove secondary meaning.
This will allow descriptive trademarks to be registered as long as they have acquired distinctiveness through use in commerce.

3.Concerning the formalities of trademark applications, broad descriptions of goods and/or services will no longer be allowed and as a consequence, the goods and/or services to be covered by an application must be strictly specified.
Applicants will be able to use “class headings”, but it will be understood that the application covering such description, will be protecting literally those goods/services included within the phrase; in order words, it should not be considered that by covering a “class heading” the trademark in comment will be protecting each and every single good/service covered within such class.

4.The definition of “Bad Faith”, defined as when an application is filed contrary to good uses, commercial practices and obtaining an undue benefit in damage of its legitimate owner, has been introduced into our law and can be used as basis for cancellation.

5.Coexistence Agreements and Letters of Consent will be accepted in an aim of permitting the coexistence in our country of similar marks, as long as their owners agree with the same.
In the past, consents and coexistence agreements were rejected by the Mexican Trademark Office, by arguing a duty to protect consumers from being misled into confusion; however and due to this inclusion into our law, trademark holders will be able to coexist in our country, with similar marks.
It is important to mention that the Authority has mentioned that it will depend on the Examiner’s subjective criteria whether these documents will be accepted or not, as long as they comply with the corresponding formalities, to be included in the regulations of our IP Law.

6.Collective marks and Certification marks are now included and regulated.

7.Before the amendment in comment, in order for a trademark owner to request the declaration of recognition of a well-known mark, it was an obligation for such owner to have a trademark registration granted in Mexico, in order to base its action; however, such provision has been modified and once the reforms enter into effect, it will no longer be necessary to have a Mexican trademark registration in order to apply for a declaration of recognition of Well-Known marks.

8.For opposition procedures, the Authority has now included a period for filing evidences and final pleadings. All kind of evidences will be accepted, except for the confessional and testimonial.
Once all proves have been offered and admitted, the Authority will open stage for filing of final pleadings, providing a 2-day term to both parties, after notification.

9.In the 80’s, the Mexican Law for Inventions and Trademarks included the obligation of a trademark holder to prove use of its mark and if no use was proven, the trademark registration was declared extinguished. In 1991 after such law was repealed and the inclusion of the actual Mexican Industrial Property Law happened, there was no longer an obligation for filing declarations of use and as a consequence, if a trademark registration was challenged for non-use, the same was cancelled by the Mexican Trademark Office.
However, the new reforms include again the obligation to file a declaration of use, same that must be filed three years and three months after the trademark registration has been granted. The lack of such declaration will cause the automatic cancellation of the registration, without the need of a third party requesting the same.
In this regard, it is important to mention that the obligation of filing declarations of use 3 years and 3 months after granting, will apply for those marks filed after the new reforms enter into force; i.e. if a trademark is granted after the reforms, but was filed before them, this use requirement will not apply to them.
It is not possible for the aforesaid amendment to apply to those marks granted before the reforms take effect, as our laws can never be applied retroactively to the detriment of a rights holder.

10.Due to the inclusion of declarations of use, trademark renewals will proceed only if a declaration of use is filed along with the renewal petition. For those marks granted before the amendments in comment, the declaration of use should be filed, but only at the time such registration has to be renewed.

11.Nowadays, article 151 states as follows:

“Art. 151. The registration of a mark shall be invalid when:
I.It is granted in violation of the provisions of this Law or that which was in force at the time of registration.
Notwithstanding the provisions of this subparagraph, the invalidation action may not be based on a challenge to the legal representation of the applicant for the registration of the mark;
II.The mark is identical or confusingly similar to another that has been used in the country or abroad, prior to the filing date of the application in respect of the registered mark and has been applied to the same or similar goods or services, provided that the person who asserts the stronger right by virtue of prior-use, proves uninterrupted use of the mark in the country or abroad, prior to the filing date or, where applicable, prior to the date of first use declared by the person who has registered it;
III.The registration was granted on the basis of particulars contained in the application that were false;
IV.The registration was granted in error, by mistake, or owing to a difference of judgment, there being another registration in force which is considered infringed because it is that of an identical or confusingly similar mark applied to identical or similar goods or services;
V.The agent, representative, licensee or distributor of the owner of a mark registered abroad applies for and secures the registration of the said mark or of a confusingly similar mark in his own name without the express consent of the owner of the foreign mark, in which case the registration shall be regarded as having been effected in bad faith.

Invalidation proceedings under this Article may be instituted within a period of five years from the date on which the publication of the registration in the Gazette becomes effective, with the exception of actions under subparagraphs I and V, which may be instituted at any time and under subparagraph II, which may be exercised within a period of three years”.

In this regard, amendments to the statutory terms for filing Nullity actions have been amended as follows:

–A nullity action can be filed at any time, when:
oA trademark was granted in violation of the provisions of applicable Law
oWhen the agent, representative, user or distributor of the owner of a mark registered abroad applied for and secures the registration of the mark without consent of the owner of the trademark
oWhen a trademark registration has been granted based on bad faith
–A nullity action can be initiated within a 5-year term, when:
oThe mark is identical or confusingly similar to another than has been used in the country or abroad prior to the filing date of the application
oThe registration was granted on the basis of false information contained in the application
oWhen the registration was granted in error, by mistake or owing to a difference of judgment.

12.The notifications issued by the Trademark Office will only be made through its Official Gazette.

13.The grounds of infringement were extended where it is now considered as infringement the non-authorized use of names, pseudonyms, signatures and portraits of persons, without consent; the titles of intellectual, or artistic works and the titles of publications and periodicals distributed; the names of fictional, or symbolic characters, or real personages portrayed; artistic names and the names of performing groups.

It is important to mention that as of today, the regulations to these new reforms have not been published; hence, we are not certain how these new figures will be operating.

For example, we are not sure if at the time a registrant needs to prove use of its mark, it will have the obligation to file evidences, or if it would be sufficient to file a simple statement under oath. In addition, we are not sure how consent documents should be drafted, in order for these to be accepted by the Authority, nor if documents should be filed, and at what stage, to prove that a descriptive mark has become distinctive, in order for the same to be eligible of registration.

Notwithstanding the latter, we are sure that these new reforms will help us keep moving forward and evolve in a way that our country continues to be an attractive jurisdiction for the holders of trademarks, keeping us in the map as an important place to invest and do business, not only for foreign companies, but also for our co-nationals.