ip articles

Domain names and trade disputes resolution in Argentina

By Moeller IP Advisors

Cybersquatting, the practice of registering domain names using a small variation on a trademark’s name, has been on the rise in South America in the last years. Argentina makes no exception. In the country, registering a ccTLD domain name with the extension .com.ar, .org.ar, .net.ar etc. was free until 2014 – certainly a strong incentive to cybersquatting practices. Indeed, it was common for some users to register a large number of domains trying to resell them to the legitimate trademark owners. It is particularly notable that until 2013, almost the 70% of all domains registered in Argentina were left inactive – probably waiting for someone to pay for them.

The Argentine Legal Framework

Recently, Argentina tried to tackle the issue of cybersquatting through a series of resolutions, of which 3 are particularly worth mentioning.

Resolution 654/2009, enacted by the Ministry of Foreign Affairs, Trade and Culture, established the first system of domain name dispute resolution.  Until then, it was only possible to file a claim to a civil court and ask for damages if the party legitimately owned a trademark. The Resolution provided that the trademark owner could file an administrative claim to the NIC, the Network Information Centre Argentina (NIC), the competent institution for registering ccTLD and gTLD domain names in the country, with the exception of the edu.ar domain, which is handled by the Network of University Interconnection Association. The resolution also established how domain names can be registered, transferred and renewed and set a 200-domain limit per registrant in order to reduce cybersquatting practices.

A few years later, the National Presidency Legal and Technical Secretariat enacted Resolution 20/2014, in a further attempt to reduce the number of cases concerning domain names and cybersquatting. As mentioned above, the Resolution established a registration fee on domain names and set that physical persons are required to submit a copy of their ID when registering, while in case of companies or other entities, the registrant needs to submit documents showing that he or she is acting as a legal representative. The Resolution also established the publication in the Official Gazette of all domain registrations and renewals, in an effort to promote transparency.

Finally and more recently, the Resolution 110/2016 by the National Presidency Legal and Technical Secretariat, abrogated the previous Resolution 20/2014 and introduced the Regulation on Management of Internet Domain Names. The Resolution set forth new Rules for the Administration of Internet domain names in Argentina replacing the current regulatory framework regarding their registration, renewal, transfer, and dispute. In order to register, administer, or dispute .ar extensions, the Resolution established that the registrant would need to be previously registered with the Administración Federal de Ingresos Públicos (AFIP), the federal tax authority. This is a further step to enhance transparency and promote the accountability of the domain owner. In regards to disputes, the Resolution also adds a chapter, establishing that users who have legitimate interest regarding the ownership of certain domain name might file a claim through the Tramites a Distancia (TAD) online platform. The defendant has 10 calendar days to answer the complaint, after which the NIC will examine the dispute and resolve the matter. The NIC’s administrative decision may be appealed at the courts.

The procedure at the NIC is certainly cost and time-effective, although it is generally advisable only for straightforward cases where trademark and disputed domain name are identical. For more complex cases, referring to a civil court may be the best solution.

Rules for Labelling and Advertising Food and Beverages in Mexico

By Moeller IP Advisors

In the last years, Mexico has been facing a rise in health issues connected to poor diet and drinking habits. According to the National Health and Nutrition Survey 2006, hypertension increased of 25% in the previous six years, while data from the OECD shows that in 2015 a whopping 30% of the adult population was obese. According to a research by the WHO, diabetes was the leading cause of death in Mexico in 2016: the population that died to diabetes has tripled since 1990, and by 2050, it is predicted that half of Mexicans will suffer from the disease. Finally, the WHO also shows that alcohol consumption appears to have been on the rise in the last 40 years – leading to an increase in alcoholism and related diseases.

The Ministry of Health has been trying to reduce the impact of nutrition-related chronic diseases by enacting a complex legal framework to ensure that consumers receive transparent information in connection with the sale of food and beverages.

The regulatory efforts have been especially focused on regulating the information contained in advertising and products labels.

The Standard Rule for Food and Non-Alcoholic Beverages

In 2014, the Federal Commission for Protection against Health Risks (COFEPRIS) amended the Mexican Official Standard Rule NOM-051-SCF/SSA1-2010 for Food and Non-Alcoholic Beverages (NOM-051). NOM 051 dictated the labeling requirements for food, non-alcoholic beverages and other pre-packed products that are imported, manufactured and sold in Mexico. In an effort to improve the quality of the information displayed to consumers, the amendments established stricter requirements for the producers, detailing how additional information, like nutrition facts, should be displayed on labels.

However, the new rules proved to be extremely complex and difficult to implement for companies, due to an unclear and ambiguous wording of the Standards. COFEPRIS and the Federal Bureau for Consumer Protection (PROFECO), in charge of verifying compliance with the new regulation, soon realized that for many companies, a total conformity with the standards was extremely difficult to achieve. In 2016, COFEPRIS assessed that more than 75% of the companies had failed to fully comply with the NOM-051.

The New Copy Advice System

With regard to alcoholic beverages labelling and advertising, in 2011 COFEPRIS had already implemented successfully the so-called Copy Advice System.

In May 2016 the system has been extended to food and soft drinks. Under the Copy Advice System, COFEPRIS will provide assistance to companies, helping them understand and implement the legal requirements of the NOM-51. Moreover, with regard to advertising, COFEPRIS will provide a pre-analysis on the advertisements drafts – before companies apply for the required formal authorization.

Although the advice provided by COFEPRIS is nonbinding, the experience with the Copy Advice System for alcoholic beverages has proved to be particularly successful to improve compliance and ultimately avoid fines. In the last 6 years, COFEPRIS and the companies involved have worked together to develop uniform, practical guidelines on the implementation of alcoholic drinks labelling and advertising regulations.  This is definitely to be taken as a promising indicator for the success of the Copy Advice System on food and non-alcoholic beverages requirements, reducing the sanctions, the costs for the companies and speeding up the procedures. In particular, COFEPRIS estimates that the Copy Advice system will reduce the response time for obtaining an advertising authorization from 40 to 5 working days.

Venezuela PTO Faces Difficult Future

By Moeller IP Advisors

Dear Clients and Associates,

The Venezuelan Association of Industrial Property Agents (COVAPI) has issued a statement related to the suspension of services of the Autonomous Services of Intellectual Property (SAPI), who since August 28, 2018 has decided to temporarily and unilaterally suspend the provision of their usual services.

Below the text of the statement:

TO OUR ASSOCIATES, COLLEAGUES AND OTHER USERS OF THE INTELLECTUAL PROPERTY AUTONOMOUS SERVICE (SAPI)

The Venezuelan Industrial Property Agents’ Association (COVAPI) hereby informs its members, colleagues and general public that the Intellectual Property Autonomous Service (SAPI), as of August 28, 2018, has suspended to render services, motivated by certain “internal affairs”, pursuant to various official notifications issued by the entity.

This suspension of services prevents the submittal of any trademark, patent and/or copyright application, notwithstanding the fact that there are three (3) IP Bulletins currently in force which generate several recourses that must be actioned by the owners of these intangibles and who are unable to do so, thereby negating their right of defense and request for protection of their intellectual rights.

COVAPI has already sent a communication to the competent authorities expressing its concern upon the climate of uncertainty and lack of judicial safeguard generated by this situation and has requested SAPI to adopt the necessary measures to reactivate its services in order to guarantee its users due protection and enforcement of their rights and interests.

We remain, Very truly yours,

The Board of Directors

IP5 pilot project on collaborative search and examination under the PCT

By José Santacroce, Head of Patent Department

On the EPO online Official Journal dated May 2018, the IP5 pilot project on collaborative search and examination under the PCT was announced.

All relevant details about said pilot project, which will start on 1 July 2018, are indicated below:

I. Concept

1. Following the first two pilot projects on collaborative search and examination (CS&E) under the PCT, which were conducted by the European Patent Office (EPO), the Korean Intellectual Property Office (KIPO) and the United States Patent and Trademark Office (USPTO) in 2010 and 2011-2012 respectively, the EPO, the Japan Patent Office (JPO), KIPO, the State Intellectual Property Office of the People’s Republic of China (SIPO) and the USPTO (the IP5 offices) are set to operationally launch a third CS&E pilot project. The aim of this pilot project will be to further develop and test the CS&E concept amongst the IP5 offices and, in particular, to assess user interest in CS&E products and the expected efficiency gains for the offices.

2. The concept of CS&E under the PCT refers to the collaboration of examiners from different international authorities in different regions and with different working languages on one international application for the establishment of an international search report and written opinion under PCT Chapter I, which, although remaining the opinion of the chosen International Searching Authority, is based on contributions from the participating offices.

3. In the pilot project, the examiner from the IP5 office acting as competent International Searching Authority under Rule 35 PCT for a given international application (“the main examiner”) will conduct the search and examination as for any other international application and establish a provisional international search report and written opinion. These provisional work products will then be transmitted to peer examiners from the other participating IP5 offices in their capacity as International Searching Authorities. Peer examiners will provide the main examiner with their contributions, taking into consideration the provisional international search report and written opinion. The final international search report and written opinion will be established by the main examiner after consideration of the contributions from the peer examiners. Further details regarding the implementation of the CS&E concept within the framework of this pilot project are provided below.

II. Framework

4. Under the pilot project, with a view to assessing the users’ interest in a CS&E product, international applications processed under the collaborative scheme will be selected by applicants (“applicant-driven approach”), whereas under the two previous pilot projects the applications were selected by the offices.

5. Applicants wishing to participate in the pilot project must submit a request for participation in the pilot by using a standard participation form and file it together with the international application with the receiving Office of one of the IP5 offices or the International Bureau of the World Intellectual Property Organization (WIPO). The participation form is available in all official languages of the IP5 offices on the WIPO website at www.wipo.int/pct/en/filing/cse.html. A copy of this form is annexed to the present notice.

6. For international applications filed in English, requests for participation in the pilot may be filed as from 1 July 2018. Each applicant will only be able to select a limited number of international applications.

7. Until 31 December 2018, only international applications filed in English will be accepted into the pilot. Thereafter, the competent International Searching Authority under Rule 35 PCT (also referred to as “the main International Searching Authority”) may also accept international applications filed in a language other than English. Where a main International Searching Authority decides to accept international applications filed in a language other than English it will inform applicants accordingly by way of a communication published on its website. Such communication will specify the additional languages which will be accepted for the purposes of the pilot and the date as of which requests for participation in the pilot may be filed in such languages, and provide explanations regarding their acceptance and processing.

8. The receiving Office will transmit the participation form to the International Bureau and the main International Searching Authority as part of the record copy and search copy respectively. Upon receipt of the search copy, the main International Searching Authority will assess whether the requirements set out in part III below are met and will notify the applicant and the International Bureau whether or not it accepts the request for participation in the pilot. It will do so using Form PCT/ISA/224 (Communication in Cases for Which No Other Form Is Applicable).

9. The main International Searching Authority will perform the search and examination in the same way as for international applications not processed under this pilot. It will establish a provisional international search report (Form PCT/ISA/210) (or, where appropriate, declaration of non-establishment of international search report (Form PCT/ISA/203)) and written opinion (Form PCT/ISA/237), and, where applicable, a record of the search strategy. The form and content of the record of search strategy will be based on the practice of the International Searching Authority concerned.

10. The main International Searching Authority will transmit these provisional work products to the peer International Searching Authorities, where peer examiners will prepare a contribution to the final search product, taking into consideration the provisional work products prepared by the main International Searching Authority. They will also perform additional searching to the extent deemed necessary.

11. With respect to the handling of non-unity cases by the peer International Searching Authorities, the principle of the first invention will be followed. This means that, whilst each main International Searching Authority will follow its own standard non-unity procedure, the provisional work products submitted to the peer International Searching Authorities are based only on the invention first mentioned in the claims. Peer examiners will focus their searches on what they determine to be the first invention, regardless of whether, according to their view, the provisional work products are directed to one or more inventions.

12. Each peer International Searching Authority will transmit its contribution to the main International Searching Authority using the standard peer contribution form. Depending on its practice, it will either record its contribution on the form itself or use the form as a cover sheet for standard forms PCT/ISA/210 and PCT/ISA/237. Peer contribution forms and any peer contributions attached to them will be made available as separate documents in PatentScope.

13. The main International Searching Authority will consider the contributions received from the peer International Searching Authorities and prepare the final international search report (Form PCT/ISA/210) (or, where appropriate, declaration of non-establishment of international search report (Form PCT/ISA/203)) and written opinion (Form PCT/ISA/237) in the light of these contributions. It will strive to establish these final work products within the time limit under Rule 42.1 PCT. However, compliance with this time limit cannot be guaranteed due to the collaborative nature of the pilot project which inherently results in additional administrative burdens. The final work products will be transmitted to the applicant and the International Bureau.

14. Final CS&E work products will be identified either by an indication in box V of Form PCT/ISA/237, or at the top of a supplemental sheet referenced in said box, as the result of collaboration under the pilot which does not necessarily reflect the opinions of all IP5 offices. Only final CS&E work products may serve as a basis for requesting participation in a Patent Prosecution Highway (PPH) pilot programme.

15. The offices will exchange documents and information with each other via an ePCT-based platform ensuring a secure and confidential data transmission. This platform will be provided and maintained by the International Bureau.

16. In this pilot project, the level of the international search fee charged by each IP5 office remains unchanged. Applicants participating in the pilot will therefore only pay the standard fee for a PCT Chapter I search at the competent International Searching Authority. However, if following this pilot the CS&E product is implemented as a regular product under the PCT, applicants will have to pay a specific CS&E fee. The maximum prospective amount of the CS&E fee is the aggregate amount of the search fees of the participating International Searching Authorities plus an administrative fee to cover the costs of collaboration.

17. Towards the end of the pilot project, applicants who have participated in it will be asked to complete a questionnaire about their interest in a regular CS&E product under the PCT. Their replies will be taken into account by the IP5 offices in their assessment of the pilot project.

III. Requirements for participation

18. The requirements for applicants’ participation in the pilot project are of two kinds: requirements to be met by applicants and limitations set by offices.

A. Requirements to be met by applicants

19. The following requirements must be met by applicants wishing to participate in the pilot project:

(a) The request for participation in the pilot must be submitted using the standard participation form and filed together with the international application.

(b) The participation form and the international application must be filed with the receiving Office of one of the IP5 offices or with the International Bureau as receiving Office.

(c) Where the participation form and the international application are filed with the EPO, they must be filed in electronic form using one of the following filing tools: the EPO Online Filing software (PCT update 1 April 2018 (build 3.51.257)), PCT-SAFE client version 3.51.081.257 (1 April 2018) or ePCT.

(d) Until languages other than English are accepted into the pilot as provided for under paragraph 7, the participation form and the international application must be filed in English.

B. Limitations set by the offices

20. The following limitations related to organizational aspects of the pilot must be complied with for the main International Searching Authority to accept a request for participation in the pilot:

(a) The applicant must not already have had ten international applications accepted in the pilot by the same main International Searching Authority, ten being the maximum number of applications permitted into the pilot per applicant at a same main International Searching Authority.

(b) Each main International Searching Authority aims to accept 100 international applications into the pilot, spread over the course of two years. The main International Searching Authority will accept applications based on achieving this aim.

(c) The main International Searching Authority must not already have accepted into the pilot the maximum number of applications that it considers appropriate in the technical field of the application for which the participation is requested. This requirement aims at ensuring the diversity of the technical fields of the applications processed under this pilot.

(d) The main International Searching Authority must not have considered that there is a specific reason (e.g. defect in the application, no sequence listing in text format complying with WIPO Standard ST.25 is available) impeding the processing of the application according to the timeline for the collaborative process.

IV. Duration

21. The pilot project is divided in two phases, a preparatory phase and an operational phase. The preparatory phase, which started on 2 June 2016, was dedicated to the administrative and practical preparations required to ensure a smooth functioning of the pilot. The operational phase will start on 1 July 2018 and will run until 1 June 2021. It will be dedicated to the processing of applications under the collaborative scheme, monitoring them for evaluation purposes and assessing the outcome of the pilot. It will also cover the assessment of the effect of the collaboration in the subsequent national/regional phases.

Source: www.epo.org

The state of Innovation in Mexico: the role of patents

by Moeller IP Advisors

In the prestigious Bloomberg’s 2017 Innovation Index published last year, Mexico failed to rank among the first 50 top countries. Brazil and Argentina ranked respectively 46th and 49th.

The index is developed on the basis of benchmarks that include spending on research and development, manufacturing, the presence of hi-tech companies and of course, the number of patents filed in the country within the year. From a legal point of view, this last aspect is particularly worth analyzing.

Patents filed in Mexico and the role of Patent Prosecution Highways

In the period 2011-2015, 79019 patent applications were filed, according to data released by the IMPI, the Mexican Intellectual Property Institute. Only around 8% of all the patent applications came from Mexican applicants, a number that is particularly striking if compared with China, where 85% of the applications in the country are filed by Chinese applicants.

In practice, in Mexico, there was one patent application per 100,000 inhabitants per year, while in China there was an average of 50 applications per 100,000 inhabitants per year.

Patent applications in Mexico come especially from public educational and research centres like the UNAM – the National Autonomous University of Mexico, the CINVESTAV – the Center for Research and Advanced Studies of the National Polytechnic Institute and the UAEH – the Autonomous University of the State of Hidalgo. These entities are usually interested in licensing their patents to foreign companies.

There are, however, examples of successful Mexican private companies, like the pharma company Laboratorios Senosiain or Laboratorios Silanes, that have developed a treatment for venomous snake bites, entering the U.S. market this year.

As said, the vast majority of patent applications in Mexico come from foreign applicants, especially Norway, Turkey, Canada and United States residents. This is certainly an indicator of the interest of foreign companies in the Mexican market, triggered by the lower cost of labour, the good infrastructure and the interest toward pharmaceuticals and biotechnology, two areas that have seen several legal developments in the latest years.

WIPO World Intellectual Property report 2017 showed that IMPI is still one of the slowest offices to issue a final decision on a patent application, with an average of 3 years. For this reason, Mexico has heavily relied on Patent Prosecution Highway procedures to speed up the analysis and filing of patent applications that have been previously filed in another country.

As of 2017, Mexico had 11 Patent Prosecution Highways with foreign entities, namely the US, Japan, Spain, South Korea, Singapore, China, Canada, Portugal, Austria, the European Patent Office and the Pacific Alliance.

Since 2011 (the year in which the first agreement with the USPTO was signed) by 2016, the Mexican patent office has received 1188 PPH applications, of which 785 have already been granted.

Patents filed by Mexican companies abroad

However, the country suffers from a low innovation potential that mirrors in the number of patents filed by Mexican residents abroad. In 2015, patents received by Mexican companies in front of the USPTO were only 172. As a comparison, South Korean residents filed 17924 patents the same year and Chinese residents 8116.

To trigger innovation, the Mexican President Enrique Pena Nieto has declared he intends to increase the government’s funding of science to 1 percent of GDP by the end of his term in 2018.

Artificial intelligence and copyright in South America

By José Santacroce, Head of Patent Department

The potential of Artificial intelligence is enormous. The interconnection of A.I. and art is a relatively less explored field, but in this regard the consequences for intellectual protection law are unpredictable and equally interesting.

In 2016, a network of Dutch museums presented a portrait created by a computer that analysed hundreds of Rembrandt paintings, to finally produce a new artwork in the style of the Dutch artist and that looks exactly as if it had been made by Rembrandt himself.

In the same year, a computer software wrote a brief novel that was admitted into a literary prize in Japan, although it didn’t make it to the final round.

Deep Mind, a Google company, has developed a program that creates original new music by listening to old recordings. The first computer-generated musical debuted in London as early as 2015.

While bots have been present in the creation of work of arts since the 1970s, the difference with modern A.I. lies in the fact that, in the past, the human programmer still had a relevant creative input and the machine merely executed, or reproduced his ideas adding an element of randomness. Today, evolved A.I. robots – due to the developments of machine learning -are capable of behaving in a sophisticated way which is almost as indistinguishable from human intelligence and are capable of unpredictable, autonomous decisions.

As copyright law protects original works of art, and the works produced by robots are certainly original, who owns the copyright to those artworks?

The consequences for copyright law

The question is relevant as there may be substantial commercial rights attached to the copyright of a work of art. Who is to benefit from the commercial rights? The developer of the software? What if the activity cannot be tracked down to a developer in particular, but to a whole company – like it usually happens in case of very sophisticated programs? Or is the machine itself to be considered as an author – but again, in that case, who holds the economical rights? And what if, on the contrary, the final work cannot be considered as attributable to anyone – and therefore can be reproduced, modified and commercialized freely?

Most jurisdictions, included South American jurisdictions, are unequipped to deal with artificial intelligence from this perspective. In Mexico, for instance, the concept of copyright is always linked to a person.

Art. 12 of the 1997 Federal Law on Copyright, states that  “The author is the natural person who has created a literary or artistic work.”

In other words, the existence of an individual identified as the author is essential; and by the same reasoning, for instance, corporations in Mexico cannot be authors, although they may be the copyright holders.

The same is true for Brazil, where section 11 of the law 9.610/ 1998, establishes that “The author of a literary, artistic or scientific work is the natural person who created it” – negating the status of creator both to companies and to the software itself.

On a global perspective, EU courts have been behaving similarly, in the sense that they attribute the rights only to a human author – see for instance the Court of Justice of the European Union (CJEU) in the decision C-5/08 Infopaq International A/S v Danske Dagbaldes Forening, where it stated that originality must reflect the “author’s own intellectual creation”, implying that a human author is necessary for a copyrighted work to exist.

The United Kingdom adopts a more blurred stance on the matter, as UK copyright law, section 9(3) of the Copyright, Designs and Patents Act (CDPA), states:

“In the case of a literary, dramatic, musical or artistic work which is computer-generated, the author shall be taken to be the person by whom the arrangements necessary for the creation of the work are undertaken” and this needs to be paired with section 178 of the CDPA defines a computer-generated work as one that “is generated by computer in circumstances such that there is no human author of the work”, admitting, in theory, that computer-generated works may exist.  It just needs to be defined who is responsible for the “necessary arrangements”, whether the programmer or the machine itself, which is still under debate in the UK.

Quickly developing technologies have put a strain on most legal systems, and South America needs to keep up with its advancements.

The Market of Generic Pharmaceuticals in Peru: Approval Process and Concept of Bioequivalence

By Moeller IP Advisors

In Peru, patent coverage for branded pharmaceuticals lasts for 20 years from the date of filing, in line with most jurisdictions. Once the 20-year term has expired, the same product can be marketed as generic. A generic drug must be equivalent to a branded drug in dosage form, safety, strength, quality, and intended use.

As the development costs are lower, generics are generally cheaper than branded pharmaceuticals, while they ensure the same therapeutic effect. The World Health Organization recommends the implementation of Generic Drug Policies and in the last years, many Latin American countries have taken steps to increase access to more affordable pharmaceuticals.

According to data from the consulting company Pharmexcil, in 2016 the market of generics accounted for about the 38% of the total pharma market in Peru, totalling $ 605 million.

Regulation of generics pharmaceuticals in Peru

According to the recommendations issued by the WHO, generics must ensure that they achieve the very same therapeutic effect as a branded pharmaceutical. They should, before entering the market, undergo a bioequivalence test. Pharmaceutical equivalence entails that both generic and branded drug should have the same amount of the same active substance, in the same dosage form, for the same route of administration and meeting the same or comparable standards.

In 2009, Peru enacted Act n. 29459 on Pharmaceutical Products, Medical Devices and Health Products. Article 10 states that companies, which aim at registering drugs in the Health Registry, must submit interchangeability studies; and that in vivo studies may be requested for drugs that may entail a higher health hazard.

The law then establishes that the procedure to evaluate the interchangeability of two pharmaceuticals will have to be defined by specific regulations.

For this purpose, the DIGEMID – General Bureau for Medicines, Inputs and Drugs of the Health Ministry was in charge of preparing a regulation detailing bioequivalence requirements, together with the CNCC – the National Center of Quality Control of the Health National Institute.

However, to this date, clear bioequivalence standards are yet to be enforced in Peru.

The economic interest of pharmaceutical companies that patented the branded products clashes with the interest of generic producers: in particular, producers of generics have been demanding to submit bioequivalence tests only for products that present a high hazard, claiming that conducting these studies involve a large investment that will eventually increase the final cost of the generic to the consumer.

On the other hand, it is undeniable and in line with the WHO requirements, that generics should at least comply with the minimum standards of interchangeability before entering the market. In this sense,  DIGEMID has been requiring a bioequivalence test for both new and existing generics, starting from drugs of narrow therapeutic index, that is those drugs in which small variations in dosage may cause serious health risks to the patient. Other generics, however, keep on being commercialized in absence of bioequivalence studies.

Clear requirements would benefit not only final consumers, but would also improve the access to the market for foreign companies wishing to commercialize their own generic medicines in the country.

Legal Implications of Smart Cities in Chile

By Moeller IP Advisors

By 2050, more than half of the world’s population is expected to live in urban areas. Providing everyone with sufficient resources like energy, water and transport may prove extremely challenging. Smart cities are born to tackle this issue with the help of digital technologies: they are based on an innovative infrastructure that uses IT, artificial intelligence and internet of things to improve energy efficiency, environmental sustainability and social welfare.

While the definition of a smart city can vary, there is general agreement on some of the elements that compose it: in smart cities, energy is generated by clean sources like hydro, solar, wind power, marine and geothermal; transport is fuel-free, mainly electric; smart grids improve energy distribution and avoid waste. In addition, buildings are smart, and therefore they are electronically monitored and controlled: sensors collect data on temperature, humidity and other values and automatically adjust lights, heating and air-conditioning; access control is provided through biometrics or other intelligent systems.

In South America, Chile is at the forefront of smart cities development. In 2015, the metropolitan region government of Chile awarded 1bn pesos – approximately US$1.6 million – to 5 smart city projects. The year before, a prototypical Smart City Santiago was launched in the Huechuraba district: the project, funded by the energy corporation Enel, is an ideal city where all technologies work in a seamless, integrated way.

Legal implications

A smart city infrastructure is based on a series of technologies that, in turn, may raise new legal issues.

First of all, smart cities are based on innovative green energy technologies, that need to be protected through intellectual property instruments like patents. Chile is one of the more developed South American countries when it comes to renewable energy – the National Energy Policy 2050 set the target of achieving the 60% of electricity production from green power. However, from 2000 to 2011 only 157 patents on climate change mitigation technologies were filed by Chilean inventors. Public funds and green patent highway program like the one established in Brazil could be an incentive to file more green patents.

Trade secrets are another useful instrument: according to article 86 of the Chilean Industrial Property Law, they consist in “any knowledge of industrial products or procedures that,  being kept secret, gives the holder a competitive advantage, enhancement or advance”. Any innovation dealing with smart city solutions could be efficiently protected as a trade secret if lacking the requirements for filing a patent.

Smart cities – and especially smart buildings – heavily rely on the internet of things technologies. The legal implications of IoT are unpredictable – especially when it comes to IP infringements. IoT devices interoperate with other systems: for instance, a software app that controls the heating system is linked to a sensor that monitors temperature, which is in turn linked to the boiler. The company that developed the sensor may require a license for their product to be connected to the software app and so does the company who built the boiler. The aspect of licensing may become pivotal to avoid patent infringements.

Cloud computing is another technology that smart cities will rely upon as storing data in the cloud ensures substantial energy savings. However, it may increase the risk of cyberattacks, trade secret thefts and data breaches. In this regard, Chile enacted the Data Protection law No. 19,223 in 1993, sanctioning all crimes against data stored in IT systems, and crimes aimed at damaging those systems. Chile joined the Budapest Convention on Cybercrime in 2017.

Brazil Progresses Toward Joining the Madrid Protocol

by Moeller IP Advisors

The Madrid Protocol is an international treaty established to create a centralized system of trademark protection for all the signatory states.

Through the rules of the Madrid Protocol, applicants can protect their trademarks in all member countries: they just need to file a single application in one of the countries’ that are part of the treaty. Procedures are uniformed and the application can be filed in one of the three official languages – English, French or Spanish.

The Madrid Protocol is certainly the most time and cost-effective means of seeking trademark protection internationally. Currently, 100 countries are signatory to the Protocol: Colombia was the first South American country to join in 2012, followed suit by Mexico in the same year.

Some issues have been partially overcome

In November 2016, Brazilian Minister of Industry, Foreign Trade and Services, Marcos Pereira, announced the intention to join the Madrid Protocol, during an official meeting with WIPO Director General Francis Gurry. It was clear, however, that accession to the uniformed Madrid system, although certainly excellent news for all companies operating in Brazil, could prove to be challenging.

For this reason, it was anticipated that the accession would happen not before than mid -2018. Indeed, there were back then, and partially still are, a series of obstacles to a smooth integration of the Madrid requirements.

First of all, it is well-known that the Brazilian INPI suffers from a chronic backlog problem. Recently filed trademark applications take an average of 25 months to be examined when there are no oppositions. The time for deciding on oppositions can take around 4 years, while decisions on appeals on trademark applications may take from seven to eight years. The Madrid Protocol sets a term of maximum 18 months for the National Patent Office to complete the substantive examination and to provide a decision. The Brazilian INPI has recently stated however that the 18 months target could be reached soon. According to an announcement released in November 2017, INPI declared that by the end of 2018, the registration period in Brazil will be shortened from the current 25 months to the 18 months required by the Madrid protocol.

If the INPI seems positive in achieving the 18 months deadline, however, there are other issues that need to be overcome.

As said, the official languages accepted by the Madrid Protocol system are English, French, and Spanish. The Brazilian INPI’s working language is Portuguese and all applications are filed in this language. Changing the internal procedures and training the examiners to be able to examine applications in different languages – or hire translators – would require an additional and very substantial cost. Moreover, the INPI would most probably need to update its IT equipment and infrastructure.

Finally, Brazil would need to change the regulation concerning multiclass applications, which are currently not allowed.

Conclusion

While Brazil has taken an important step towards the Madrid Protocol, some issues still need to be addressed. However, INPI is confident that the country could be able to join the Madrid Protocol as early as 2019.

Joining the Protocol would make it easier both for Brazilian companies to expand their business internationally and for international corporations to operate in the South American country. For some commentators, Brazil annexation to the treaty would even have a sort of a domino effect on the South American region, as Uruguay is said to be assessing the possibility to join the Protocol too, and other countries may follow suit.

Want to register a Green Patent in South America? Brazil Made it Quicker for You

By Moeller IP Advisors

The Potential for Green Technologies

Green is certainly an adjective that fits Brazil. Not only because of the abundance of its natural resources, but for several other reasons:  Brazil is one of the world leaders in bioenergy – more than 85% of the domestically produced electricity used in Brazil comes from renewable energy sources.

Moreover, the country has been a pioneer in biofuel production from ethanol and is now one of the biggest producers. Not only has the biofuel sector allowed Brazilian companies like Cosan or GranBio to prosper but it has also seen US companies like Shell, Amyris, Solazyme and Cobalt enter the scene, with conspicuous investments in ethanol, biobutanol and biofene production plants.

It goes without saying that fields like alternative energy production or clean transport require a great effort in research and development and constant investments in innovation: patents are the only way to protect such efforts.

However, it is well known that the Brazilian patent system suffers from a chronic issue: the one of the backlog. Currently, the Brazilian PTO’s (Brazil Patent Office) average time for granting a patent is 10 years. This is extremely discouraging for foreign and local companies that need a fast return on their investments. Moreover, as the field is constantly innovating, this could mean that the technology becomes already obsolete by the time the patent is granted.

The Green Patent Program

That’s why, in April 2012, the Brazilian PTO launched an innovative fast-track program exclusively for green patents (patentesverdes). It was the first emerging economy to do so.

The program aimed at accelerating green patent applications, reducing the average time to less than 2 years and focusing on the areas of alternative energy, transportation, energy conservation, waste management and agriculture.

Biofuels were obviously included in the list of technologies that could be granted the fast track, together with less known, but equally relevant technologies like geothermal energy, ocean thermal energy, hydrogen-powered vehicles and use of waste for production of fertilizers, among the others. The list compiled by the Brazilian PTO was based on the WIPO’s IPC Green Inventory.

Obviously, the traditional requirements of novelty, inventiveness and industrial application needed to be respected as well.

In addition, the application must have contained a maximum of fifteen claims, including 3 independent claims; it must have been published in the Brazilian Industrial Property Gazette or a request for early publication must have been submitted; and a fee of R1,775, around 500 USD, must have been paid.

The green patent fast-track program, being a pilot program, limited the number of patents that could benefit from the priority examination to 500.

From Pilot to Permanent

 On December 6, 2016, the Brazilian PTO announced that the green patent program has become permanent.

Data collected from 2012 shows that the program has been a success: on a total of 480 applications, 325 were considered eligible for the priority examination. The average time for granting a patent was about two years, much less than the 10 years the Brazilian PTO has been averaging.

As it is clear, a faster examination process can allow inventors to start licensing their technologies more quickly; moreover being granted a patent is also pivotal for smaller companies to raise investment capital – and it worth noticing that some of the key actors in the green tech and biofuel production