Anti-counterfeiting

Anti-counterfeiting and remedies in Mexico

As a result of the implementation of the latest amendments to our Federal Criminal Procedure Law, it is worth mentioning that the criminal conduct foreseen as “counterfeiting of registered trademarks”, is no longer considered as a “serious” offense or a major felony, due to the fact that this particular character is only granted for very specific violations that are expressly appointed within our criminal code.

In that understanding and despite the possible incarceration sentence that could be obtained against subjects responsible of committing the crime of trademark counterfeiting, at the end of the trial, the convicted can request to commute such  guilty verdict through any of the alternative penalties foreseen in our criminal law provisions (if applicable) in order not to be restricted from its freedom. 

Therefore, even when on these criminal procedures against counterfeiters, they are subsequently released, as noted before; in most cases these criminal actions and raids with the police are often enough to achieve much of the totality of the objectives and goals sought.

Moreover, not less important is to mention that our criminal law also gives the possibility to call the involved parties to conciliate or try to resolve the conflict through an “Alternative Dispute Resolution Mechanism”, which is a useful tool to reach out an agreement between the parties and come into an amicable solution before furtherly prosecuting the case before a Judge, as this legal figure has also been included for accelerating and resolving minor offenses procedures that do not require preventive prison, as well as to adopt all those transcendental provisions which have been taken into the Human Rights field.

 

Legal remedies

For the enforcement of IP rights, our Mexican Legislation establishes different paths and legal measures in order to effectively combat counterfeiting while attending to the nature of each specific case. 

In accordance with the judicial and administrative enforcement bodies in our country, the proper actions to be performed against these type of illegal conducts are through i) infringement actions to be filed and ruled before the Mexican Institute of Industrial Property (IMPI) and ii) criminal complaints to be prosecuted before the Specialized Unit for Investigation of Crimes against Copyright and Industrial Property (UEIDDAPI-FGR).

These remedies must be exercised by the holder of the IP rights or its legal representative, as well as taking into consideration the legal requirements foreseen in the applicable law, given the fact that in some cases the proper path to be followed shall be an infringement action mainly when we are dealing with trademarks confusingly similar and the goal is just an economic sanction (fine), against the infringer or the criminal action when we are dealing with accurate falsifications of trademarks and when the goal is to give a deep hit to counterfeiters, what usually depends on the enforcement policies and business decisions of each holder of rights.

In order to carry out the above remedies, the Competent Authorities usually work in cooperation with others no less important agencies such as: the Federal Commission for Protection from Sanitary Risks; the Mexican General Customs Administration (AGA); the Federal and Local Police Departments of the different states throughout the country, with the aim to join efforts to combat piracy and counterfeiting.

However, even when it seems that we have all the effective legal measures and remedies to face these counterfeiting issues, it is also true that Mexico has a very formalistic legal system, which in most cases involves difficulty in applying the proper action by the owners of IP rights.

By way of illustration, the Mexican Customs have no faculties to rapidly secure and seize a shipment which is entering our country at the borders, in an “ex-officio” manner, even when the product is clearly infringing a registered trademark; given the fact that said Customs can only take action by means of a written or official injunction issued by the competent authority, whereby is ordered the seizure of the counterfeit products or illegal merchandise (IMPI, FGR or a Judge).

Following this idea, due to the lack of faculties in the Mexican Customs Officials, the trademark owners have a very short period of time to initiate a legal action (usually no more than 48 hours) with the intention of detaining and/or seizing the offending products and thus prevent that such merchandise is legally imported and later distributed to final consumers, as well as ensuing a criminal investigation that would hopefully produce an indictment against the importer of such illegal goods. Hence, it is clear that this situation must be taken into account to improve our legal system and be able to act against these counterfeited shipments in the most cost-effective manner.

Furthermore, it is important to point out that, in order to duly apply these remedies against the introduction of illegal merchandise, the Customs have permitted to record the information concerning IP rights in relation to authorized importers, licensees, etc., within an Electronic Database of Registered Trademarks, which was mainly created with the purpose of speeding inspection and clearance procedures to detect counterfeit and IP-infringing merchandise in an accurate way.

Clearly, this is an important advance in the last few years, since it has been very useful to create reliable information channels to alert owners and/or right holders, so they can produce the relevant legal actions to protect their trademark rights as early as possible.

In this sense, we must say that there are indeed suitable tools and remedies to enforce IP rights of the holders, even though we still have some areas to increase in our legislation; as well as it is important to keep on mind that these counterfeit issues are more likely to be presented in different ways in accordance with the specific niche of commerce, thus in order to come up with a successful and suitable action against counterfeiters it is very important to understand and identify the dimension of the specific matter and in parallel carry out an enforcement strategy, so as to achieve the best results in stopping the counterfeiting activities.

 

Counterfeiting in E-commerce platforms

In accordance with this kind of commerce, it has become a reality the fact that many of the purchases are not only carried out in Malls or other physical stores, since now are made through different platforms such as: Amazon, Mercado Libre, Ebay, etc., which of course represents a great advance in the way of shopping, but unfortunately also implies a new channel or window for counterfeiters.

In that note, some studies and research done on this field has determined that the high popularity of electronic commerce is due to the fact that i) purchasers usually want something they do not find in regular stores; ii) because in most cases international prices are better than the national prices and; iii) because the brands or products are not available in the country, what in consequence has caused the increase of counterfeited products on the market and has enabled third parties to sell counterfeit items while reproducing falsified trademarks and copyrights through these electronic platforms.

In any event, we must say that on these cases it is even more difficult to initiate or exert either one of the legal measures previously mentioned due to the following:

+ Lack of information about the counterfeiter, as now with the Federal Data Privacy Law it is allowed not to include sensitive information on the internet including this type of platforms, what in consequence generates uncertainty about the specifics of the people behind these illegal activities.

+ As these platforms allow international shopping, it is worth mentioning that the scope of enforcement of a registered trademark mainly relies on the fact that the same solely produces its legal effects per territory as registered and therefore the proper action to be taken against the counterfeiter —which is out of the territory from where the products are being introduced or imported–  in almost all cases becomes impossible.

+ Poor and bad quality of the images shown in the products, which in general do not allow the consumer to clearly identify certain keys and data information regarding the clothing, footwear, jewelry, etc., in order to make sure about the originality of the goods.

In view of the above, as an alternative, said platforms have incorporated “Brand Protection Programs” to assist IP holders with the fight against counterfeiting, which in practice are ease to interact and useful for carrying out the “Notice and Takedown”; being this a quick solution to remove counterfeiting from these platforms, even though we still need to implement strong and more effective tools to combat piracy on this new field.

 

Future and legal reforms

Lately, it has been discussed the implementation of new reforms and amendments to our judicial and administrative bodies of law with the aim to improve our legislation and also to grant to the competent authorities all the necessary legal faculties to act with more certainty and freedom while implementing or intercepting counterfeited shipments, as well as to foresee the new e-commerce figure and the proper way to regulate it, among other transcendental provisions. 

However, and in the end, even when all these regulations have to be a primary task for our legislators with the aim to strengthen our anti-counterfeiting Intellectual Property System in Mexico, it is even more important that the owners of IP rights may continue encouraged and combatting piracy/counterfeiting at all levels and through the enforcement legal remedies stated by law in order that at some point informal commerce and counterfeiters may refrain from performing these behaviors and otherwise the original goods may rely on the market without the consumer public may be seriously affected or induced to any risk of confusion.

 

Oliver Silva 

para la revista WTR Country Correspondent