AIPLA - AMERICAN INTELLECTUAL PROPERTY LAW ASSOCIATION

2010 Report

ARGENTINA

“Several changes to Argentinean legislation over the last two years have modified some
aspects of the legal landscape for patents, trademarks, industrial models and data
exclusivity. It is crucial that companies are made aware of these changes and stay in
tune with the idiosyncrasies of the Argentinean IP regime.”

Patents and Influenza A (H1 N1)

“At the Mercosur summit held in Paraguay this year, it was suggested in press
conferences that the patents for vaccines relating to Influenza A (H1N1) should be
suspended or weakened in the member countries.
However, it is important that the patent systems should not be weakened nor
suspended, but rather reinforced and applied in its entirely. The patent system is an
irreplaceable incentive for innovation, particularly with respect to obtaining treatments
and cures for new diseases, as with Influenza A (H1N1). For this reason, it is necessary
to comply with and reinforce the patent legislation.
The Argentine patent law and international treaties include provisions for compulsory
licenses, which allow the use of the invention in the case of a health emergency when a
patent has been granted, and also contemplate compensation to the patent owner.
The Influenza A (H1N1) vaccine is still being developed and, according to a recent
statement of the World Health Organization, it will be available during the last months of
2009. It should be noted that in Argentina the grant of a patent takes several years, and
even longer in the case of patents for pharmaceutical products.
Furthermore, it is important to bear in mind that in the case of the Influenza A (H1N1)
vaccine, the issue of possible compulsory licenses should be analyzed when the patent
is effectively granted. If such patent application is filed in Argentina, the granting will take
between eight and 10 years from the filing date of the application, judging by other
pharmaceutical cases.”

Simplified trademark renewal

“In accordance with the Argentine trade mark law, the protection term for a registered
trade mark is 10 years from the registration date. Provided that a trade mark is used
within a period of five years preceding the expiration date, it may be renewed indefinitely
for a 10-year period.
Regarding renewals of registered trademarks, the Argentine Institute of Industrial
Property (INPI) has recently established, by means of Resolution N° 604/09, a simplified
regime for the renewal of a registered trade mark.
Section 1 says:
"A simplified regime is established for the renewal procedure of a registered trade mark
without being necessary to request the original record from the File; such system will be
applied provided the following conditions take place: a.) the title deed or certified copy or
the photocopy thereof signed by the interested party or by its attorney-in-fact when
evidenced by a power of attorney or by an IP agent, is filed together with the application;
b.) the trade mark owner indicated therein coincides with the applicant of the renewal; c.)
these data coincide with those in the database."”
(MITELMAN, Carlos O.; ZUCCHERINO, Daniel R. IP developments in Argentina.
Managing Intellectual Property - IP Focus Americas, London, v. 5, p.21-23, 2009.)

BOLIVIA

Bolivian government creates indigenous pharmaceutical (from: IP Tango)

The Bolivian government will launch a pharmaceutical company with remedies of

traditional indigenous medicine. The Health Minister, Ramiro Tapia, informed that they
have invested 10 million dollars in this project.

The country already has seen the opening of two ‘intercultural pharmacies’. The
pharmacies sell both, common drugs and natural medicines produced from plants and
using indigenous knowledge. The pharmacists are also accompanied by healers
commonly called ‘kallawayas’.

This decision comes after years of public statements by indigenous groups in Bolivia,
Colombia, Ecuador and Peru rejecting intellectual property rights of drug companies
because they become richer at the expense of the indigenous resources. They rightly
proclaim the defence of their medicinal plants and their ancestral knowledge.

BRAZIL

The Viagra Case (Dannemann, Siemsen)

In March 2010, there was an important decision held at the join Panel at the Superior
Court of Justice concerning a request from Pfizer for obtaining the correction of the
pipeline patent term of Viagra. Having received a similar decision from the 3rd Panel
(Diovan’s case), the Reporting Justice Hon. Otávio Noronha suggested that since the
cases were identical, there should be scheduled a single judgment session in the join
Panel in order to harmonize the understanding of the Superior Court in the matter of
pipeline patent term correction.

The Reporting Justice granted PTO's special appeal against the correction of the term of
Viagra’s pipeline patent.

Justices Sidney Benetti and Vasco Della Giustina (both from the 3rd Panel) followed this
opinion.

Justice Luiz Felipe Salomão (from the 4th Panel) requested the dockets for a deeper
review, interrupting the judgment. Hons Aldir Passarinho, Honildo Anmaral and Nancy
Andrighi did not vote.

In view of this fact, the judgment session was suspended and was resumed on April 14,
2010, when the Panel decided against Pfizer by majority of 5 x 1. The only dissenting
opinion was Hon. Salomão.
Against this decision, Pfizer filed a motion for clarification, which is still pending at the
Superior Court of Justice.

Stem Cell Technology and its Patentability

“Stem cells form the basis of all organs and tissues in an organism. Given the proper
conditions, these cells are able to grow and differentiate into specialized cells with
specific functions, like skin, muscle or liver cells. Stem cells also have the property of
self-renewal, meaning they can divide and produce other stem cells.”

“Stem cells can be used in many ways. In basic research, these include the study of
human development and associated abnormalities, of human diseases in animal
models, and of pharmacology and toxicological testing, which would allow new drugs to
be tested on specific, differentiated cells. Clinical research has shown enormous interest
in using stem cells in gene therapy and to produce lineages specifically for transplants.
Recently, induced pluripotent stem cells (iPS cells), which have properties similar to
those of embryonic stem cells, were developed from already specialized cells.

In Brazil, Biosafety Law No. 11,105, dated 24 March 2005, legalized the use of stem
cells from embryos frozen for at least three years for the purposes of research and gene
therapy. The number of patent applications in Brazil related to stem cells has been
growing over the years. A search in the BPTO (Brazilian Patent and Trademark Office)
patent database, available online, using the keywords stem-cell(s), stem cell(s), embryo
cell(s) and embryonic cell(s) in the title or abstract, identified around 145 documents filed
or published in Brazil in the period 1997 to 2009, excluding documents still in the non-
disclosure period as set forth in the Paris Convention. In 10 cases (6.9% of the total) the
application owner was Brazilian, while in 72 cases (49.6% of the total, almost half of the
cases), the owner is American; in one case joint ownership is shared with Brazil and in
another with China. In 2003, 9 patent applications on this matter were published in
Brazil; in 2004, this number went to 16; in 2005, 12; and in 2006 and 2007, 27
applications were published each year.

In 2009, the BPTO released on its website, in the publication “Alerta Tecnológico”
(Technological Alert), a report with all the patent applications for stem cells published
worldwide in the first and second halves of 2008, allowing it to compare applications in
Brazil with those in other countries during that year. Of the applications published in
2008, 697 identified the United States as the priority country. In second place, Japan
was listed on 136 applications. The report does not cite Brazil on any application that
year. However, the BPTO database search for 2008 identified 16 patent applications
published in Brazil that year, with only of these having Brazilian priority.

Law No. 9,279/96 (Industrial Property Law - IPL) does not consider the following to be
invention: all or part of natural living beings and biological materials found in nature,
operating or surgical techniques and therapeutic or diagnostic methods, for use on the
human or animal body. However, processes for pharmaceutical c o m b i n a t i o n s / c
o m p o u n d s , obtaining/modifying, uses, kits and other tangible results, including
those involving stem cell technology, are patentable, provided they meet the
requirements of novelty, inventive step and industrial application. The BPTO considers
that stem cell patentability cannot be analyzed in depth yet, because substantive
examinations of most stem cell related patent applications filed and published in Brazil
have not yet been completed. Nonetheless, the examination guidelines published by the
Institute make it clear that it accepts this technology by granting patents for processes
for obtaining and using stem cells, provided they comply with the legal provisions noted
above.”

(MAGLUTA, Eliane Pereira Simões – Dannemann Siemsen News – n. 27 – March/May

2010)

COLOMBIA (Alvaro Correa y Ricardo Metke – Baker & McKenzie Colombia)

1. Legislation news:

1.1 Resolution 12 dated January 7, 2010, by means of which the proceeding for
compulsory licensing is established.

The Superintendence of Industry and Commerce rendered Resolution 12 dated January

7, 2010 by means of which it established the proceeding for compulsory licensing. This
regulation is in force as of January 13, 2010.

With regard to compulsory licensing for reasons of public interest it was established that
once the reasons of public interest are published to grant a compulsory license over a
patent, within 15 working days the Patent Office through its website, must convene third
parties so they submit applications to obtain a license over the patent indicated by the
same office. In addition, it established the deadline for doing so, as well as the terms,
conditions and special requirements to be met by applications. As regards to compulsory
licensing for reasons of national security o emergency or for abuse of dominant position
the period to convene third parties was set at 5 working days.
The Resolution established the formal requirements to be contained in applications for
compulsory licenses for non-exploitation, public interest reasons, for reasons of national
security emergency or for abuse of a dominant position in the market and when the
exploitation of a patent necessarily requires the use of another patent. It sets a 15
working days period counted as of the filing of the application in the case of licensing for
lack of exploitation, reasons of public interest, abuse of dominant position and
dependence on a patent for the Patent Office to carry out the formal examination and
make the necessary requirements. In the case of licensing for reasons of national
security or emergency that period was reduced to 3 days.

Once the application is admitted, it will be notified to the patent holder and a 60 working
days period will be granted for it to present arguments and evidence. After the term for
gathering evidence expires the parties have 5 working days term to present their
arguments in support of their claims after which the Patent Office shall decide on
granting the compulsory license indicating the period for which it is granted, the object,
amount and conditions of the license.

In all cases the applicant must demonstrate that it meets the conditions to be a licensee
of the patent in accordance with the requirements set by the Patent Office.

Additionally, this Resolution determine the following criteria for determining the
compensation payable by the licensee to the holder of the patent: the economic value of
the authorization, the conditions governing contractual licenses for similar products in
domestic and international licenses, the investments that the licensee must perform to
exploit the patent, and in the case of licenses for abuse of dominant position, the need to
correct the anticompetitive practices.

Finally, it set out three cases in which the Patent Office may terminate ex officio or upon
request from a third party a compulsory license: (i) in case of serious or repeated breach
by the licensee of any of the obligations imposed on the act by means of which the
license was granted, (ii) when the circumstances that gave rise to the license have
disappeared and are not likely to resurface, and (iii) when the licensee has not
commenced exploitation of the patent within 2 years from the date in which the license
was granted or if it has suspended its exploitation without a just cause for the same
period in the case of licenses granted for lack of exploitation.

1.2 Resolution 41083 dated August 6, 2010 by means The Superintendence of

Industry and Commerce granted National Federation of Coffee Growers the
authority to authorize the use of the DO CAFÉ DE COLOMBIA.

The Superintendence of Industry and Commerce issued Resolution 41083 dated August
6, 2010 by means of which it delegated to a specific body, the National Federation of
Coffee Growers, the power to authorize the use of the Designation of Origin CAFÉ DE
COLOMBIA. This is the first case in which an individual is empowered to authorize the
use of a Designation of Origin in Colombia.

Under Article 208 of Decision 486 of 2000 of the Andean Community the competent
national offices of each of the member states (in case of Colombia the Superintendence
of Industry and Commerce) are empowered to grant authorizations for the use of
Designation of Origin. Additionally, as established by Decree 3081 of 2005, this power
may also be delegated to public or private entities that represent the beneficiaries of the
Designation of Origin.

Based on the mentioned regulations the National Federation of Coffee Growers, a union
status organization composed by Colombian coffee growers, requested the
Superintendence of Industry and Commerce to delegate the authority to authorize the
use of the Designation of Origin CAFÉ DE COLOMBIA.

The Superintendence of Industry and Commerce found that the National Federation of
Coffee Growers has a legitimate interest to request the delegation of authorization for
use of that name, as well as financial and administrative capacity for granting
authorizations for its use.

The Superintendence found that the Regulations for Use of the Designation of Origin
CAFÉ DE COLOMBIA presented by the National Federation of Coffee Growers meets
the requirements of the legislation since it describes the characteristics of the product,
regulates the production practices to maintain quality protection, provides threshing
rules, marking and packaging of the product, and obligations of users of the Designation
of Origin.

It concluded that the certification body of the product is an impartial, competent, suitable,
experienced and reliable institution with the coverage needed to manage the certification
system of the Designation of Origin CAFÉ DE COLOMBIA.
1.3 Decree 1313 (April 21, 2010) lays down regulations on parallel imports
regarding of drugs and medical devices that are not included in the plans of
national benefits.

The Ministry of Health issued Decree 1313 dated April 21, 2010, by means of which it
established the conditions and procedures required to obtain permission from the
Colombian Health Authority, Invima, for the parallel importation of drugs and medical
devices that are not included in the plans of national benefits.

The government issued such regulation on the basis of the provisions of the Doha
Ministerial Declaration adopted on November 14, 2001, by members of the World Trade
Organization in which they reaffirmed their right to use the provisions of the TRIPS
Agreement which includes cases of flexibility to intellectual property rights, including
parallel imports. Parallel imports allow third parties that do not hold permission from the
trademark’s owner, to import a product covered by that mark, which has been placed in
international trade by its rightful owner or with its consent, without being liable for
infringing industrial property rights.

Based on the above norm, any Colombian public or private entity may import drugs and
medical devices included in the above described situation, as long as they obtain prior
authorization from the Colombian Health Authority and fulfilling all the requirements
provided for therein.

Decree 1313 of 2010 established within the procedure for obtaining prior authorization
for the import from the Colombian Health Authority the possibility of submitting instead of
the sanitary registration granted by said authority, the health registration given by the
health authority of the exporting country of the product being imported.

2. International Treaties:

2.1 Status of the approval proceeding of the Madrid Protocol

The bill debated in the Colombian Congress for the approval of the Madrid Protocol did
not complete the required legislative process since the legislature ended before the
fourth debate and voting procedure required for approval could take place. The bill had
been approved in the three previous debates.

The start of the new legislature on July 20, 2010 entails that the bill for the approval of
the Madrid Protocol shall be presented once more before the Congress for it to be
debated as a new bill.

2.2 Status of the approval proceeding of the WIPO’s Trademark Law Treaty

The WIPO’s Trademark Law Treaty and its regulation was adopted in Colombia through
Law 1343 of 2009. Following the presidential approval said Law was submitted before
the Constitutional Court for it to rule on its constitutionality.
By means of ruling 127 dated August 10, 2010 the Constitutional Court ordered that the
Law by means of which the WIPO’s Trademark Law Treaty was approved to be returned
to Congress so that a defect detected in the legislative process is corrected.

The Court’s decision was grounded on the fact that the principle of publicity at the time
of the vote demanded by the Political Constitution was ignored in the process of
discussion and adoption of Law 1343 of 2009. Under this principle the date and session
in which a particular bill will be voted voting must be announced in advance and in a
different session from the one in which the project is approved

Since the detected defect is subject of being corrected, the Court returned Law 1343 to
Congress so that is proceeds in that direction and the subsequent stages of the
proceeding are fulfilled. Subsequently, the President must sign the law once again and
submit it before the Constitutional Court for it to render its final decision on its
constitutionality.

This is the reason why the WIPO’s Trademark Law Treaty has not yet entered in force in
Colombia. The adoption of the Treaty will demand modifications to the procedure
established by the existing rules so as to ensure that the mechanisms included in the
Treaty adequate to the Colombian system.

3. Case Law:

3.1 Ruling date March 8, 2010, by means of which the Council of State annulled a
trademark registration for the word mark ATORVASTAN proved to be confusingly
similar to the protected INN atorvastatin.

For the first time, the Council of State annulled a trademark registration of a word mark
proved to be confusingly similar to a pharmaceutical- active principle.

The protection of INNs (International Non – Proprietary Names provided to

pharmaceutical- active principles by the World Health Organization) in connection with
similar trademarks is not subject to statutory law in Colombia; thus precedents are highly
important in this matter.

Thus far, the Council of State was open to accepting trademark registrations for similar
trademarks to generic names, under the argument that these registrations were not
prohibited by our Trademark Law. The Council of State considered that the prohibition of
granting trademark registration was for expressions that were generic names, not to
expressions alleged to be similar to generic names.

The discussion focused on whether ATORVASTAN could be subject to trademark

protection, or whether it is not sufficiently distinctive to identify pharmaceuticals, as it
could be confused with the generic name atorvastatin.

The Council of State analyzed the distinctiveness of ATORVASTAN from the

perspective of the ordinary consumers of pharmaceuticals, and has declared that, while
the mark is different from atorvastatin, it does not have sufficient elements to indicate an
entrepreneurial origin, thus, it lacks distinctiveness.
On the other hand, the Council of State indicated that the likelihood of confusion
between the mark and the INN is valid ground to annul a trademark registration for lack
of distinctiveness. Indeed, the Court declared that patients and consumers of
pharmaceuticals may confuse products identify as or labeled ATORVASTAN, and
products containing the active principle atorvastatin. Thus, the mark ATORVASTAN is
not apt to identify pharmaceuticals in the market.

This decision reveals a significant change in the position of the Council of State
regarding its analysis of distinctiveness of pharmaceutical trademarks, and provides new
elements and parameters for trademark owners and petitioners, on the relevance of
analyzing the distinctiveness of pharmaceutical marks considering their similarities with
generic names.

Of outmost importance is that the Council of State preferred to give weight to the
perspective of consumers to decide this case involving an INN. The Court provided
guidelines for future cases in which the consumer’s perspective will be the main
reference to demonstrate the distinctiveness of pharmaceutical trademarks or lack
thereof.

On the other hand, it is remarkable that this decision helps in aligning the Colombian
trademark system with the recommendations of the World Health Organization (WHO)
aimed at preventing the trademark registration of terms closely similar to protected INNs.

Chile (Rafael Pastor – Baker McKenzie Chile)

Canceling Unlawful Trademarks in Chile: A reverse to a statute of limitation

exemption?

According to article 6 bis (3) of the Paris Convention, no time limit shall be fixed for
requesting the cancellation of well-known trademarks registered in bad faith. This article
makes it mandatory for members of this Convention to actually not accept a statute of
limitation that contests a cancellation action filed against a well-know trademark that is
registered unlawfully (in bad faith) in any country member of this Convention.

The Paris Convention came into force in Chile on September 30, 1991, when it was
published in the Chilean Official Gazette. The latter entailed that from that day on Chile
could be eventually held internationally liable for not implementing this exception
internally (reforming Industrial Property Law No 19.039) nor granting it a self-executing
nature. However, while the first option was not undertaken by the Chilean government,
the second one was on a case law basis. In fact, the Department of Industrial Property -
DPI (today National Institute of Industrial Property – INAPI), issued judgments that made
article 6 bis (3) of the Paris Convention utterly self-executing from an administrative
stance.

Take for instance judgment No 104.795, passed down by DPI in regards to a

cancellation action filed by John Galiano S.A. against registration No 403.735, registered
under the name of Comercial Eccsa Sociedad Anónima for trademark John Galiano in
connection to goods from class 25. DPI did no uphold the defendants claim that a statue
of limitation should have prevailed in this case because more than five years had gone
by since the date of this registration. The overruling was based on the fact that John
Galiano is a well known trademark in connection to goods from class 25 and was
registered in bad faith, so no time limit was accepted.

Likewise, on July 18, 2000, DPI passed down judgment No 103.419, DPI in regards to a
cancellation action filed by Brau A.G. against registration No 384.730, registered under
the name of Jose Miguel Feliu Sanhueza for trademark ZIPFER URTYP in connection to
goods from class 32. DPI did no uphold the defendants claim that a statue of limitation
should have prevailed in this case because more than five years had gone by since the
date of this registration. The overruling was also based on the fact that ZIPFER URTYP
is a well known trademark in connection to goods from class 32 and that it was
registered in bad faith, so no time limit was accepted.

Chile only officially incorporated the statute of limitation from Article 6 bis (3) into
Industrial Property Law No 19.039 (article 27) on March 11, 2005, as a consequence of
its incorporation to the WTO and TRIPS earlier on and in order to comply with this treaty
and its appendix.

However, a new criterion was passed down by the Chilean Industrial Property Appeals
Court last year in regards to the self executing nature of the statute of limitation
exemption from article 6 bis (3) of the Paris Convention. In fact, on January 29, 2009,
this Higher Court did not uphold the arguments claimed in the appeal filed by O'Neill
Europe B.V., against the initial judgment issued by the DPI that did not accept the
exemption of the statute of limitation from article 6 bis (3) of the Paris Convention
regarding a cancellation action filed against registration No 410.116 for trademark
O'NEILL, registered in connection to goods from classes 9, 12, 25 and 28, under the
name of Jorge Rolando Halabi N. The Higher Court's ruling disregards the self executing
nature of the statute of limitation exemption from article 6 bis (3) by stating that Chile
should constitutionally follow a dualistic approach between National and International
Law that requires the translation of the latter into the former.

In this sense, this ruling clearly points out that the exemption of this statute of limitation
has been only in force since March 11, 2005 (date of the local implementation of the
article 6 bis (3) of the Paris Convention into Chile's Law No 19.039) and not since
September 30, 1991 (year in which the Paris convention came into force in Chile). The
latter criterion enables any owner of a trademark that was registered unlawfully before
March 11, 2005, to argue in favor of the statute of limitation and rules out the option of
claiming the Paris Convention's self-executing nature in regards to the statute of
limitation exemption.

This criterion can be viewed as a low blow for well-know foreign trademark owners. If
there trademarks were unlawfully registered by a Chilean citizen or a Chilean company
in our country before March 11, 2005, they are now (according to this criterion) not
entitled to claim the special exemption of the stature of limitation established in the Paris
Convention, in order to cancel illegal trademark registrations and be able to use their
trademarks in Chile.

Albeit, O'Neill Europe B.V. filed a last resort challenge against the Chilean Industrial
Property Appeals Court's ruling before the Chilean Supreme Court in a effort to obtain
the invalidation or annulment of the same and a new judgment that accepts the
cancellation action and disregards this new criterion. hoping that Supreme Court will
reverse this new manner of interpreting article 6 bis (3) of the Paris Convention for the
sake of foreign well-know trademark owners in Chile.

Mining Cluster, Patents and Innovation

The Chilean Patent and Trademark Office (INAPI) issued in 2010 a report about
patenting in our country’s mining cluster. The results are very interesting.

The report highlights one of the prior recommendations of Chile’s National Strategy of
Innovation and Competitiveness, in the sense that from a public policy perspective the
mining industry should be treated as a cluster and thus patents play a key role as an
innovation indicator for this productive sector of the economy.

In sum, the report findings include:

1. 1090 patent applications related to the mining cluster were filed before INAPI from
2000 to 2009.

2. 639 of these applications were filed by non-residents (58.62%) and 451 were filed by
residents (41.38%).

3. The amount of patent applications filed by residents that stem from the mining cluster
is higher than the general average of patent applications filed by Chilean residents in all
industries (14.45%).

4. The annual evolution of patenting in the mining cluster renders evidence of a 29%
differentiation between applications filed annually by residents and non-residents. While
residents file an annual average of 45 applications, non-residents file an average of 64
applications.

5. Patent applications from 31 countries were filed in connection to the mining cluster.
93.3% of these applications come from only 10 different countries. Chile leads this
ranking with 41.38%, followed by Finland (11.47%) and the USA (10.83%).
6. The top 10 ten patent filing firms in the Chilean mining cluster are Outokumpu OYJ
with 78 applications (7.16%), Codelco together with the Instituto Innovación en Minería
and Metalurgia with 75 applications (6.7%), and Australian Orica Explosives Technology
PTY LTD. with 33 patent applications (3.03%).

Chile adopts the 9th Edition of the Nice Agreement

According to a new notice issued on July 20 in the Chilean Official Gazzette, from
September 1st 2010 Chiles National Institute of Industrial Property (INAPI) will us the 9th
Edition of the Nice Agreement in order to classify goods and services in connection to
trademark applications.

INAPI informed that this “adoption will help to harmonize our practices of classifing
goods and services for trademark application with other countries, and greatly simplify
the process by allowing the applications to refer to the version that, is being used by
similar offices abroad.”

The communication continues by mentioning that it will “greatly facilitate the preparation
of applications, as the products and services to which a mark is applied for will be
classified in the same way in all countries that use it. This 9th edition is available in
several languages (English, French and Spanish), which saves work to the applicants
who must submit a list of products and services in a language other than the country of
origin of the trade mark.”
Amended Chilean Copyright Goes into Effect

The Chilean Congress amended the Copyright Act in order to comply with the Chile-US
Free Trade Agreement (CH-US FTA), the new new law was published in Chile’s Official
Gazette in May 2010.

To summarize, the new law’s amendments include:

1. Higher Penalties

Penalties will increase twenty fold for certain infringements and can be up to US$
140,000 in the case of a reoffender.

Punishment can be up to ten years for offenders that import, produce or acquire for
distribution copyrighted goods without the titleholder’s authorization.

A new punishment aggravation was laid down for copyright infringements that are
committed by an illegal association. This innovation is sound in the sense that proving
the requirements of an illegal association as a felony is very difficult, so now the plaintiff
can recur now to this new punishment aggravation to ensure a higher punishment when
infringers illegally associate themselves to engage in a copyright felony.

Goods that are seized on grounds of copyright counterfeiting can be destroyed or

donated to a non-profit organization if the titleholder agrees to the option.

The yardstick for ascertaining damages is the legitimate retail market sales value of the
copyrighted works. Moreover, a civil court may sentence the offender to repay profits
made from the sale of copyright infringing goods.

In order to sentence the offender to pay punitive damages, the civil court must consider
the circumstances of the infringement, the seriousness of the damage, the harm to the
titleholder’s reputation, and the objective degree that the copyrighted works have been
illegally spread.

2. Exceptions and Limitations

It is not illegal to reproduce, adapt, distribute and/or communicate to the public

copyrighted works provided that the actions are undertaken for the sole benefit of
disabled persons (individuals with visual or learning impairments, or the like).

Non-profit libraries and archives are also allowed to copy up to two versions of book
works when they are part of their permanent collection and a copy is necessary to
preserve the edition, or to replace the work if it is lost or damaged

A non-profit library may make two backup copies to replace another non-profit library’s
book that is lost, destroyed or is unusable.
A book can also be copied when it is incorporated into a non-profit library’s permanent
collection.

A non-profit library may only copy a book if it has not been available in the domestic or
international market for the preceding three years.

Reverse engineering is allowed over software only for R&D and compatibility try outs.
It can also be undertaken in order to do research, improve and/or correct the
software´s security and function.

Satires and parodies are allowed provided that they contain an artistic contribution that
sufficiently differentiates them from the original copyrighted work.

Exceptional use of copyrighted works is allowed for critics, commentaries, caricatures,

education, academics and research, provided that the use is not a disguised
commercial exploitation. The latter exception is not applicable to audiovisual
documentaries.

Use of copyrighted works is allowed before an administrative or judicial court of law.

Translation of copyrighted works originally written in a foreign language is allowed

provided that the translation is for personal use only.

This new version of Chile’s copyright law does not include the Fair Use Doctrine.

3. Regulations for Internet Service Providers

The general rule is that, except under the circumstances set forth in the law and
discussed below, qualifying internet service providers (ISP) are exempt from copyright
infringement liability.

This exemption extends to 4 defined categories of services provided:

• Transitory communications (meaning that the provider merely transmits, routes

or provides connections for material that comes through its system);
• System caching (meaning the temporary storage of such material);
• Storage of materials at the direction of a user (hosting sites, running mailing
lists, news groups, chat and the like); and
• Information location tools (search engine facilities).

The new law does not regulate the notice and take-down system. An ISP will become
liable if it is served by a court of law in regards to the infringement and it fails to take-
down or perform other necessary actions.

If an ISP gets notice from the copyright holder and decides to collaborate by shutting
down the infringers, it will not be liable for the infringement.

4. Ownership over Software and Work for Hire

According to the new regulations, whoever hires a third party to develop a software will
be to sole owner of the copyright.
5. Circumvention of Effective Technological Measures

Unfortunately, the new law does not include remedies for the circumvention of effective
technological measures that authors, performers, and producers of phonograms use in
connection with the exercise of their rights. These technological measures restrict
unauthorized acts with respect to the works, performances, and phonograms that are
protected under copyright and related law.

In this sense, Chile has yet to fully comply with the CH-US FTA and will need to pass
new regulations in this regard as soon as possible

Chile: Counterfeiting and Corporate Social Responsibility

Former Chilean President Michelle Bachelet signed on January 11, 2010, the
Organization for Economic Co-operation and Development’s (OECD) access
agreement and thus enabled Chile to become the second Latin American country
to be accepted as a member of this prestigious international organization.

One of the OECD’s concerns is related to the negative externalities that

counterfeiting and piracy are generating on international trade, and more
specifically on companies, governments and consumers. In this sense, it should be
noted that these wrong doings have gained public awareness and are no longer
considered exclusively as a problematic enforcement matter for trademark owners
from the private sector.

According to OECD, counterfeiting and piracy harm not only companies by

diminishing the economic value of their trademarks, but also have a staggering
impact on governments that face lower tax revenues and increasing costs for
dealing with informal trade and organized crime.

Likewise, these infringements are a constant threat for consumers, who put at risk
their health and personal assets when acquiring fake goods mainly from the
pharmaceutical, electrical and tobacco industries.

Moreover, the OECD also promotes the notion of Corporate Social Responsibility,
so that companies should be concerned not only in regards to the needs of their
clients and employees, but also in connection with other public issues, such as the
adverse impact that counterfeiting triggers among consumers in different markets.

Consequently, it seems quite straightforward to argue that the incorporation of

Chile to the OECD is not only a great opportunity for the government and Chilean
companies, but also for foreign companies based in Chile that will qualitatively
improve their Corporate Social Responsibility if they continue collaborating with our
country’s efforts to reduce counterfeiting and piracy.

Chile’s adoption of UPOV 91 and the new Act of vegetal varieties

Two important bills that reform Chile’s plant varieties rights legislation are very close to
being enacted. This bills seek to change local laws in order to comply with UPOV 1991
standards.
As a consequence of the aforementioned, the protection will be enhanced in the
following manner:

(i) the fruit will also be protected,

(ii) the protection timewise increases from 18 to 25 years in the case of tree and grapes
varieties and from 15 to 20 years for the rest,
(iii); the provisional protection covers the time period that starts on the date that the
plant variety is published date and ends on the registration date,
(iv) it incorporates the concept of essentially derivated variety,
(v) the farmers are only allowed to use the product of the harvest legitimately acquired
by the cultivation of the protected variety (farmers’ right) for reproduction or
multiplication purposes and
(vi) fines values increase to 150 Index-Link Units (app. USD 6.100).

Civil actions are also expressly granted. The latter will be processed pursuant to the
summary proceeding before the ordinary courts of justice.

Exclusion of Chile from the Intellectual Property Red List by the European Union.

The European Union’s decision of ruling out Chile from the Intellectual Property Red
List on its enforcement report of 2009, entails an important acknowledgement of the
efforts undertaken by Chile in regards to IP protection.

The creation of the National Institute of Intellectual Property (INAPI) and specific Anti-
counterfeiting Police Unit (BRIDEPI) are recognized as positive improvements. While
the report maintains China in the first level, Indonesia, The Philippines, Thailand and
Turkey, in the second one, and Argentine, Brazil, Canada, India, Israel, Korea,
Malaysia, Russia, Ukraine, United States of America and Vietnam, in the third level,
excludes Chile from this list in recognition its improvements.

This recognition towards Chile, was not borne in mind by the United States. The USTR
decided to keep Chile for the fourth consecutive year in their Priorty Red List, with other
countries that do not meet minimum standards of protection of Intellectual Property
rights.

Ecuador (Xavier Rosales – Corral & Rosales)

Compulsory Licenses on Pharmaceutical Patents

1.1. Since the start of its government (2007) president Correa had publicly stated
that the prices of medicines are too high and that exclusive rights granted by
patents are to a great extent the cause for such high pricing. At the beginning
of 2009 president Correa started addressing the possibility of either voiding
patent protection or grant compulsory licenses over pharmaceutical patents in
order to reduce the price of medicines and provide a broader access to
medicine to the population. On October 23, 2009 the government enacted
Executive Decree 118 (the “Decree”) on the issuance of compulsory licenses
over pharmaceutical patents, apparently within a strategy by the government to
try to lower the price of medicines.

1.2. The Decree acknowledges the validity of pharmaceutical patents by

establishing the possibility of having compulsory licenses there over. The
Decree contains several rules regarding the granting of compulsory licenses
which were not necessary and provide no additional regulation from the
 already existing legal framework through TRIPs, Decision 486 of the Andean
Community and Ecuador’s Intellectual Property Law.

1.3. Access to medicines used for the treatment of diseases affecting the
population in Ecuador and which are considered a priority for public health is
declared an issue of public interest, thereby creating the basis for granting of
compulsory licenses since Decision 486 and the Intellectual Property Law
allows granting of compulsory licenses based on issues of public interest.
There is no specific reference as to which diseases are to be considered a
priority for public health and in practice this is being considered on a case by
case basis.

1.4. Interested third parties need to file individual applications to this effect before
the Intellectual Property Office, through the National Directorship of Industrial
Property. The Intellectual Property Office has to support and motivate the
granting of each compulsory license and shall coordinate the process with the
Ministry of Health –who is in charge of determining if the license over any
specific patent complies the public interest policy. On each compulsory license
granted the Intellectual Property Office needs to determine the scope, purpose,
term and economic compensation for the patent owner.

1.5. On April, 2010 the Intellectual Property Office granted the first compulsory
license over active ingredient Ritonavir –used for AIDS treatment- owned by
Abbott Laboratories in favor of Eskegroup S.A., a local company owned by
Indian individuals and potentially linked to Indian pharmaceutical laboratories.

II. New Rules on Payment of Patent Annuities

Since June, 2010 Ecuador applies new rules –in addition to higher amounts- for the
payment of patent annuities, considering the international filing date rather than the
local filing date and therefore, determining the need to pay annuities retroactively
when filing a local application or the national phase of a PCT application.

PARAGUAY

“Paraguay has just such a system in place. On February 22 2008 Resolution 101,
which allows for the registration of trademarks with Customs, came into effect. The new
law marks an important step forward for Paraguay in its fight against piracy; however,
concerns have been raised about some practical aspects of the registration procedure.
It seems that a few wrinkles in the system need to be
ironed out before rights holders can fully benefit from the remedies available.
Despite these early setbacks, Customs is open to dialogue and the private sector also
appears willing to help move things forward.
As a result, roundtable meetings and discussions have been held in recent months to
facilitate the implementation of the registration system. More of these meetings are
expected and further political support would help reinforce and promote the use of the
registration process – a procedure that has proved very useful in other countries.”

(GIAY, Gustavo. At the edges of protection in Latin America. WORLD TRADEMARK

REVIEW, London, v. 21, p.9-11, out./nov. 2009.)

Operation Jupiter, South America V – 2010

The INTERPOL Intellectual Property (IP) Rights Programme, in partnership with the
National Police from Paraguay, commenced the start of the fifth operation by delivering
a three day training course in Ciudad Del Este, Paraguay only three kilometers from
the Tri-border area. Representatives from the following 6 countries in South America
were present during this advanced course: Argentina, Brazil, Chile, Paraguay and
Uruguay and Peru (as observer). The training was attended by 45 officials in total,
which included Police officers, Customs officers, Prosecutors and Judicial
representatives. This is the first IP crime training held in Paraguay, and Ciudad Del
Este was chosen as the focal point of the commercial trade occurring in the tri-border
area, shared by Argentina, Brazil and Paraguay. The training also included private
sector representatives from different industries briefing participants about new trends in
the region, as well as representatives of international organizations, such as the World
Customs Organization (WCO), and leading law enforcement agencies from around the
world. The agenda also included an operational workshop organized by Paraguayan
Customs in the "Puente de la Amistad" - the bridge that divides Paraguay from Brazil.
Results will be diffused once compiled.
(http://www.interpol.int/public/FinancialCrime/IntellectualProperty/OperationJupiter/Defa
ult.asp)

Optical disc piracy levels have not been reduced in Paraguay

Even though the importation of blank media has decreased, this has been offset by the
five large optical disc factories operating in the Province of Alto Parana, where Ciudad
del Este is located. The amount of optical medial product legally imported into
Paraguay continues to exceed possible local use. Unfortunately, there was only one
major seizure of blank media in 2009. We do no have the official import numbers for
2009. At the local level, there are hundreds of smaller burning labs in Ciudad del Este
supplied by pirate kingpins who coordinate their work an provide these labs with blank
CD-Rs. Furthermore, Paraguay remains a significant transshipper of pirate products
and optical media to its neighbors, especially Brazil.
(http://www.iipa.com/rbc/2010/2010SPEC301PARAGUAY.pdf )

PERU (María del Carmen Alvarado – Estudio Rodrigo Elias & Medrano)

Numbers regarding PCT applications

The Patent Office has been receiving international applications on behalf of the
International Bureau of WIPO, which acts as Receiving Office. Up to August 20, 2010
fourteen applications patent applications have been filed under this system (Rule 19.4.
paragraph b). Thirteen belong to natural persons and only one belongs to a legal entity.

It is expected that the Peruvian Patent Office would be able to fully act as Receiving
Office for international applications in the short time.

Finally, regarding the National Phase, up to August 20, 2010 the Patent Office has
received 2 applications, both belonging to legal entities.

Adhesions to Treaties by the Republic of Peru

As a result of the signature of the Free Trade Agreement (FTA) by the Republic of Peru
and the United States of America, on July 13, 2010 Peru adhered to the International
Convention for the Protection of New Varieties of Plants (UPOV).
Intellectual Property Case Law in Peru

Mr. Freddy Santiago Tudelano Yanama vs. British American Tobacco (Brands) Inc.
(Well known trademarks) – Resolution No. 2951-2009/TPI-INDECOPI (11.09.2009)

On October 23, 2006, British American Tobacco (Brands) Inc. (hereinafter BAT) filed
an opposition action against the registration of the mark KENT (word) applied by Mr.
Freddy Santiago Tudelano Yanama for products included in International Class 32
(non-alcoholic drinks; fruit drinks and fruit juices; aerated waters; syrups and other
preparations for making beverages). The opposition was supported on the following
arguments:

(i) The likelihood of confusion between the requested mark (KENT) and the
trademarks KENT (word and Design) registered in the name of BAT for products
included in International Class 34 (mainly cigarettes). For this purpose, BAT invoked
article 136, paragraph a), of Decision 486 of the Andean Community, which states that:

“Those signs may not be registered as marks whose use in trade would unduly
harm a third-party right, especially where: (…)(a) they are identical or similar to a
mark previously filed for registration or registered by a third party in respect of the
same goods or services, or for goods or services regarding which the use of the
mark could cause a risk of confusion or association”.

(ii) The notoriety of the trademark KENT among Peruvian consumers. For this
purpose, BAT invoked article 136, paragraph h), of Decision 486 of the Andean
Community, which states the following:

“Those signs may not be registered as marks whose use in trade would unduly harm a
third-party right, especially where: (…) (h) they constitute a reproduction, imitation,
translation, transliteration or transcription of all or part of a well-known distinctive sign
the owner of which is a third party, regardless of the goods or services to which the
sign is applied, where their use would be liable to create a risk of confusion or
association with that third party or with his goods or services, constitute
misappropriation of the prestige of the sign or dilution of its distinctive power or
commercial or advertising value”.

By means of the Resolution No. 312-2008/CSD-INDECOPI dated October 1, 2008, the

Trademark Office (first administrative instance) declared groundless the opposition
arguing that: (i) The requested mark and trademarks registered in the name of BAT
were not capable of causing a likelihood of confusion as there is no competitive
connection between the products identified by the marks included in classes 32 and 34;
(ii) BAT did not prove the condition of KENT as a well known trademark. As a
consequence of the above, the registration of the mark KENT was granted to the
applicant.

BAT filed an appeal against Resolution No. 312-2008/CSD-INDECOPI and the case
was submitted before the Intellectual Property Chamber of Indecopi’s Tribunal (second
and last administrative instance) for revision.

By means of the Resolution No. 2951-2009/TPI-INDECOPI dated November 9, 2009,

the Intellectual Property Chamber of Indecopi’s Tribunal issued a final Resolution on
the case under the following terms:
(i) Revoked the Resolution No. 312-2008/CSD-INDECOPI issued by the
Trademark Office and denied the registration of the mark KENT in the name of Mr.
Freddy Santiago Tudelano Yanama.

The Tribunal recognized the notoriety of the trademark KENT for products included in
International Class 34 and stated that the registration of the mark KENT in the name of
a different titleholder for products included in International Class 32 constituted the
misappropriation of the prestige of the well known trademark KENT as well as the
dilution of its distinctiveness.

(ii) Stated that even though the marks are similar, the fact that there is no
competitive connection between the products would not cause confusion among the
consumers.

(iii) Approved a binding precedent regarding the treatment of well known

trademarks in Peru under the following terms:

“The notoriety of a trademark must be proved in the proceeding where the same is
invoked. Therefore, who ever invokes the notoriety of a trademark must prove such
condition. In this sense, by virtue of the burden of proof principle, the party that invokes
the notoriety of a trademark submit the evidence that would create certainty in the
administrative authority regarding such notoriety.

The trademarks whose notoriety is recognized must have a wider protection than a
common trademark; although the criteria adopted in order to evaluate the likelihood of
confusion between a sign and a well known trademark is the same than the one used
between common trademarks, in case of well known trademarks, such criteria must be
applied in a more rigorous way.

The special protection granted to well known trademarks breaks with the specialty and
territorial principles. Thus, regarding the specialty principle, such protection is extended
to products or services without prejudice of the class where they belong, expanding the
general guidelines in order to determine the competitive connection between the
products/services of the signs matter of the conflict. With respect to the territorial
principle, it must be taken into account that for the recognition of the notoriety of a
trademark it is not necessary a real and effective use of the mark; likewise, it is also not
necessary to be a registered trademark or to have a registration that it is in force.

Regarding the dilution of the distinctiveness of a well know trademark, though the
doctrine has always sustained that the concept of dilution is only applicable to
renowned trademarks, following the indications pointed by the Andean Court of Justice,
the same has also to be analyzed when the condition of a well known trademark has
been recognized, since the current Andean rule -namely Decision 486- does not make
a distinction between notorious and renowned trademarks.

The concept of dilution admits an exceptional supposal of protection in trademark law,

by virtue of which it aims to avoid that the breaking up of the association mark-product
or mark-service due to the action of a third party that uses the same sign or a similar
sign for products or services of different nature.

Regarding the concept of misappropriation of the prestige of the well known trademark,
this Tribunal considers that when a third party uses a well known trademark in order to
distinguish its products or services without the trademark’s owner authorization, the
misappropriation of the prestige of the mark takes place, since the person who uses
the trademark will obtain a benefit without paying the necessary costs for the creation
and consolidation of such positive image”.

URUGUAY

“Some countries, such as Uruguay, have failed to comply with TRIPs and have yet to
implement the required border measures.

Although no specific law or regulation has been passed in Uruguay as regards border
measures, the courts have introduced a number of measures by interpreting the
existing Uruguayan Trademark Law. On the basis of certain provisions of this law,
criminal judges can authorize the detention and seizure of cargo in transit. Thus,
Uruguayan rights holders enjoy a certain level of border protection, which has been
enhanced by the joint efforts made by the private
and public sectors to organize training seminars on the identification of counterfeit
goods. These meetings have been held regularly for the past year and have provided
Uruguayan police and customs officials with guidance to help them in their fight against
counterfeiting and piracy.”
(GIAY, Gustavo. At the edges of protection in Latin America. WORLD TRADEMARK
REVIEW, London, v. 21, p.9-11, out./nov. 2009.)

VENEZUELA (Dianne Phoebus – Baker McKenzie Venezuela)

IP under the 1955 Industrial Property Law

Up until April 22, 2006, Venezuela was a member of the Andean Pact and as such,
trademarks and patents were governed by Decision 486 of the Andean Pact. On April
22, 2006, Venezuela notified the Andean Pact countries of its decision to withdraw from
the Pact. In spite of this decision, the Venezuelan Industrial Property Registry had
consistently applied Decision 486 with respect to industrial property matters.

On September 12, 2008, the Registry issued an official notification informing the
general public that they would no longer be applying Decision 486 and that, instead,
they would be applying the 1955 Industrial Property Law. Resolutions in Industrial
Property Bulletins published subsequent to September 12, 2008 have been based on
the 1955 Industrial Property Law rather than Decision 486. This change in applicable
legislation has seriously affected IP practice since the 1955 Industrial Property Law is
very different from Decision 486.

In spite of the fact that the Industrial Property Registry does not have legal standing to
decide what legislation should be applied, the fact is that they are applying the 1955
Law. Several legal actions have been filed with respect to this change and eventually
the Supreme Court should issue a decision. It is not clear, however, how long it will
take the Supreme Court to issue the decision.

Although government officials say that they will be modifying this Law in the near
future, below is an informal report on what the 1955 Law means for IP owners. As far
as the trademark procedure itself is concerned, here is a very basic description:

1. Application filed;
2. Reviewed as to formal requirements; returned if it does not meet formal
requirements;
3. Reviewed as to registrability;
4. Registry orders (in the Bulletin) the publication of the application in a local
newspaper;
5. Excerpt of publication must be filed with the Registry;
6. Registry then publishes the application in an Industrial Property Bulletin so third
parties have an opportunity to oppose;
7. If not opposed, the application is published as granted or denied in an Industrial
Property Bulletin.

Other important aspects to take into consideration are:

• Searches must be conducted prior or simultaneous to filing an application;

searches more than 30 days old will not be accepted for this purposes;
• Applications must cite the Venezuelan class as well as the international class,
and applications must be filed for as many international classes as are covered
by the goods;
• Trademark applications must be published in a local newspaper and the
excerpts of the publications must be filed with the Registry;
• Failure to answer an opposition will result in the application being considered
withdrawn;
• A trademark registration is valid for fifteen years;
• There is no express grace period for renewals.

The table below summarizes important issues, article by article.

Venezuela
1955 Industrial Property Law
Aspects relevant to Trademarks

Subject Art. Content Comments

Assignment: 4 The assignment of IP rights The Registry can easily take
Recordal on is not effective before third four years or more record
Registry books. parties until the assignment assignments and other
is recorded on the official actions on the official books.
books.
Assignment: 4 In trademark assignments, A clause dealing with this
Same or similar identical or similar issue should be included in
marks presumed trademarks owned by the assignment agreements.
assigned. assignor are considered
assigned unless expressly
stated to the contrary.
Assignment: 4 Business must be assigned
Trade Name: with trade name.
Business must also
be assigned.
Assignment: 4 A slogan can only be All slogans associated with
Slogan: Presumed assigned along with the any assigned trademark
assigned with associated trademark. should be included in the
associated mark. trademark assignment.
Trademark 27 The definition of a
definition. trademark does not appear
to be broad enough to
include non-traditional
 marks such as sounds or
smells.
Duration: 15 years 31 A trademark registration
lasts 15 years.
Renewal: No 31 No grace period for
grace period renewals: A registration
must be renewed within six
months prior to its
expiration date.
Cancellation for 36 Trademark registrations are According to jurisprudence
nonuse d subject to being declared issued under the l955 Law,
null and void if they have -Use must be made by
not been used for two registered owner or
consecutive years. registered licensee;
-Subsequent use does not
cure the defect caused by a
consecutive two-year period
of nonuse;
-Use must be territorial, i.e.
in Venezuela.
Applications, 42 Registrar can deny
assignments, b) applications for registration,
name changes, assignments, name
renewals: Denial. changes or renewals.
Appeals: 5 days 43 Five days to appeal
Registrar's decisions.
Search prior to 71 Official search required This requirement is based on
application g) prior to filing trademark an erroneous interpretation
application. of this article. Prior searches
were not required under this
law in the past. The Registry
has allowed applications to
be filed without filing the
search results, but the
applications will be returned
due to failure to fulfill
formalities if the search
results are not submitted.
Publication in 76 Once ordered by the The Registry requires that all
newspaper Registrar, trademark marks be published in either
applications must be of two specific newspapers.
published in a local
newspaper and the
publication excerpt must be
filed with the Industrial
Property Registry.
 Subject Art. Content Comments
Opposition: 77 Opposition against a Oppositions based on better
Better right/prior 2) trademark application for right will be decided by the
use better right, based on prior Courts rather than by the
use. Industrial Property
Registrar.
Opposition: 79 Failure to answer an
Failure to answer, opposition will result in the
application application being
considered considered withdrawn.
withdrawn
Nullity actions 84 Nullity action based on
violation of third party's
rights can be filed only if an
opposition has not been
filed, and the action must
be filed within two years of
the date of registration of
the trademark.
Assignments and 90- Assignments and name There is no mention of
name changes: 91 changes can only be assignments and name
Notifications not recorded against
changes with respect to
accepted in registrations. applications. The Registry
connection with officials have interpreted this
pending to mean that they will not
applications. accept notifications of such
changes and assignments.
This matter under discussion
with Registry officials.
Venezuelan 106 The Law provides for a The Venezuelan as well as
Classification Venezuelan classification of the international class must
goods. be cited on a trademark
application, and a separate
application must be filed for
each international class
covered by the application.