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How Venezuelan Crisis affects IP owners

HOW VENEZUELAN CRISIS AFFECTS INTELLECTUAL PROPERTY OWNERS People who believe that cryptocurrencies have no real utility should look carefully at what is happening in Venezuela.

By Alvaro R. Bonilla. Founder BR Latin American IP LLC

You have probably never heard about the Petro, a cryptocurrency launched in October 2018 by the government of Venezuela as a measure to fight against an out of control inflation of more than 1.000.000%.

The "Petro" was launched about a year after the "Rabbit Plan" didn't work out. The "Rabbit Plan" was a national campaign for people to raise rabbits in their houses so they could have access to animal protein, something very scarce in once the richest country of Latin America. The plan did not meet the expectations as most people were not capable of killing what became their furry pet.

Well, now Petro has become the payment method for official fees for foreign IP applicants, but there is more than a catch with this.

How did we get to this point?

First, the Chavist Venezuelan government has never been a fan of Intellectual Property. In fact, they are against any private property and even more if it is an income producer private property.

For years the Venezuelan IP authority, the SAPI, became a black box were applications were filed but nothing happened. Not even a single patent was granted for many years.

One day, following the example of their socialist friends in Ecuador, they discovered that they could make a good amount of money charging incredible high official fees to foreign applicants.

The SAPI opened bank accounts in the US and later in Puerto Rico to receive payments from foreign applicants as it was not possible for them to pay in the local currency.

Later, as the Venezuela huge humanitarian, economic, social, political and international crisis became a regional problem, the US government started to impose sanctions against their regime.

The time when the SAPI was receiving thousands of dollars for a single patent annuity came to an end as their US-based bank accounts got closed.

On February 2nd, 2018, the Venezuelan Patent and Trademark Office (SAPI) advised the public to stop making registration related fee payments in foreign currency until the authorities could clarify the exchange rate to be applied. In fact, their official exchange rate is so distorted that if used applicants will end up paying pennies for their applications.

On August 23, 2018, the SAPI approved a new set of fees that represented a price increase of 142,000%, a move that sparked outrage among the IP community in Venezuela, with several of its leaders calling for the repeal of the measure.

On top of this, the SAPI entered back in low-activity mode, virtually halting the IP registration proceedings.

The situation did not change much until February 1st, 2019, when the SAPI published a new set of fees, which ended the year-long suspension of payments enacted on February 2018.

Not all was good news: according to the SAPI announcement, foreign applicants and right owners would have to make their payments in "Petros", the government-sponsored cryptocurrency.

Legal challenges have been announced against the measure, but their success is far from guaranteed.

The SAPI directive meant a new hurdle for US-based applicants, since on March 19th, 2018 the US government had issued an executive order effectively prohibiting any US person or within the US to provide financing for or otherwise deal in "any digital currency, digital coin, or digital token that was issued by, for, or on behalf of the Government of Venezuela on or after January 9, 2018."

So foreign applicants are now in a delicate situation if they do not use the Petros they might lose their IP rights in Venezuela. But if they use them to pay their fees they are at high risk of getting a sanction from the US.

Even though the "Petros" payment platform is not yet available for the general public, we recommend our clients to seek regulatory advice in their countries in order to avoid potential risks.

As with everything now in Venezuela we are not sure what is going to happen. At least we know for sure that as the "rabbit plan" is no longer working we will not have to pay official fees with rabbits.

Colombia: the Superintendence of Industry and Commerce assumed IBEPI's Presidency

Since 01st January 2019, The Colombian Superintendence of Industry and Commerce (SIC) has assumed Pro Tempore, the Presidency of the Ibero-American Program on Industrial Property and Development Promotion (IBEPI). The programme subscribed to the Ibero-American General Secretariat (SEGIB) brings together the Intellectual Property National Offices of 14 countries of the region, including: Brazil, Argentina, Spain, Mexico, Peru, Portugal, El Salvador, Guatemala, Costa Rica, Ecuador, Uruguay, Paraguay, Dominican Republic and Colombia.

The IBEPI focuses on the promotion of the use of intellectual property as a tool for competition and development in the industrial, commercial and research areas of Ibero-American countries. Its general objective is the promotion of development of Ibero-American societies through the strategic use of intellectual property in support of public policies; it aims to use it as a tool for competitiveness in the commercial, industrial and research sectors of the region.

The program is currently developing five lines of action which will be promoted and articulated through the year. This include: (i) Technological Information, (ii) Modernization of Offices, creation of Human Resources and Training; (iii) Communications, CIBEYME and Advise to Users; (iv) Observance of Rights; and (v) International Cooperation with other Intellectual Property Programmes.

Sources SIC and IBEPI.

Post written by
Lina Marcela Tello Perlaza
Lawyer (Icesi University, Cali Colombia)
LLM in International Commercial Law (Brunel University, London UK)

Brazil: Geographical Indication gets e-application running

Yesterday, 21th February, 2019 the Brazilian Instituto Nacional da Propriedade Industrial (INPI) has made available the electronic system for Geographical Indications (GIs). This was approved by Resolution No. 233 of January 18, 2019.

The system aims to speed the process and allows the applicant to file the petition from any place and any day of the week. Through the system, you could get assistance on how to complete the forms.
The system is available by using the same login and password registered in the (Union Collection Guide GRU) if you have one. If not, then you need to obtain a GRU number which is payable – you need to do so before starting the application.

A user’s guide can be found here.

The Industrial Property Law no. 9279/96, sets up the system for GI protection in Brazil. The law distinguishes between 2 types of GIs: Indication of Source (Indicação de Procedência) and Appellation of Origin (Denominação de Origem).
The INPI has registered 51 Indicação de Procedência (all nationals)  and 20 DOs (9 of them are nationals).

They are:
Alta Mogiana
Altos Montes
Cachoeiro de Itapemirim
Cariri Paraibano
Colônia Witmarsum
Costa Negra
Cruzeiro do Sul
Divina Pastora
Litoral Norte Gaúcho
Manguezais de Alagoas
Mara Rosa
Microrregião de Abaíra
Monte Belo
Norte Pioneiro do Paraná
Oeste do Paraná
Pampa Gaúcho da Campanha Meridional
Pedro II
Pinto Bandeira
Porto Digital
Região de Corupá
Região da Serra da Mantiqueira
Região das Lagoas Mundaú-Manguaba
Região do Pinhal
Região de Própolis Verde
Região de Salinas
Região do Cerrado Mineiro (DO)
Região do Cerrado Mineiro(IP)
Região do Jalapão
Região Pedra Carijó
Região Pedra Cinza
Região Pedra Madeira
Região de São Bento de Urânia
Rio Negro
São João del Rei
São Matheus
São Tiago
Sul da Bahia
Vales da Uva Goethe
Vale do Submédio São Francisco
Vale dos Sinos
Vale dos Vinhedos(DO)
Vale dos Vinhedos(IP)
Venda Nova do Imigrante

Source, the INPI.

The battle of Pisco

Peru has scored once more in the international recognition of Pisco, their national drink.
The Registry of Industrial Property of Guatemala recognized Pisco as a Denomination of Origin (DO) produced in Peru. By Guatemala recognising Pisco as a drink from Peru, it prevents the registration of the name and any marketing of Pisco within the Guatemalan market if it has not complied with the Peruvian national regulation.

Back in 2017, 'Pisco' was declared Cultural Heritage of the Peruvian Nation (Law 30639). In the same year, the DO Pisco was also granted (by The Peruvian Institute for the Defense of Competition and Protection of Intellectual Property INDECOPI) the character of ‘reputable mark’ due to its well-known status.

It is relevant to mention that Pisco is original to Peru as it is original to Chile – therefore there is a long battle between these two countries over the name ‘Pisco’. Pisco has obtained DOs in both jurisdiction as an original and native drink. Some countries would recognise Pisco as coming from Chile and others, from Peru, but not from both countries at the same time, except the EU. This is so because the EU registered Peruvian Pisco as a DO but acknowledged a previous trade agreement (2002) between Chile and the EU in which Pisco was recognized as a DO from Chile. The note clarifies that the protection granted to "Pisco" as a DO to Peru does not hinder the use of that name for products originating in Chile.

Malasia recognizes Pisco as a DO from Peru as well as, Israel, Nicaragua, Algeria, Cuba, Georgia, Haiti, Bolivia, Colombia, Ecuador, El Salvador, Guatemala, Panama, Dominica Republic, Venezuela, Nicaragua and India (since November 2018). However, Costa Rica, United States, China, Malaysia, Singapore, Thailand and Vietnam recognize Pisco as a DO from Chile.

More information about Pisco here.

Handicraft: Brazilian GIs

From Brazil, we would like to report the application for a Geographical Indication (GI) for a handicraft.

A GI is set to differentiate products due to their geographical origin; it could be environmental conditions i.e. natural conditions and or cultural conditions, which are present on a region that gives the product certain unique qualities.

In Brazil, The Normative Instruction (IN) No 25/2013 Article 2 defines as a GI an ‘Indicação de Procedência’ (Indication of Source) and a ‘Denominação de Origem’ (Denomination of Origin (DO)). DO is more valued because it depends on proof that the product has special characteristics due to its geographical environment, including natural AND human factors.

The application was for the ceramics and decoration of Porto Ferreira, in the form of Indication of Source. Porto Ferreira is located in the central region of the state of São Paulo. It is claimed that the ceramics and its decoration follow a century-old tradition. The handicraft pieces includes plates, bowls, cups, porcelain and others. The production of the ceramics involves around 80 local companies.
Photo: INPI

Some outside actors were present in the application, and this is common in developing countries. The rational is that they may assist in the GI recognition processes. In this particular case, the city's mayor, the president of INPI, the Secretary of Economic Development and Tourism, the head of the Innovation division, and the president of the local producers' union attended. Moreover, not only before the application or during the application the team is helpful, but also it is recognised that once a GI is documented, it can boost an entire economic system associated with a specific local resource. This means that the producers themselves benefit as well as the entire region e.g. tourism.

Public consultation: Brazil opens up on GIs

November saw the Brazilian Intellectual Property Office opening a public consultation for the Draft on the ‘Normative Instruction’ that will establish the conditions for registration of Geographical Indications (GIs). This move aims to provide ‘transparency to the analysis and examination procedures’. Moreover, INPI adds that it is important to hear suggestions from users.

Comments and suggestions are open to anyone and they can be submitted until December 6, 2018 to consultapublicaig@inpi.gov.br. If you want to put your thoughts forward, here you can find the way to do it (a form available online). The Draft of the ‘Normative Instruction’ is available here (in Portuguese).

Talking about GIs in Brazil, in October two new GIs were granted, both in the agricultural sector.
Jabuticaba, Brazil
  1. 23 October 2018 an Indicação de Procedência (indication of source) was granted to products derived from jabuticaba, located in the municipality of Sabará. Products represented under this GI would be liqueur, jelly, sauce, crystallized bark and jam. Sabará is known for the production of jabuticaba derivatives. Jabuticada (Myrciaria cauliflora) is a seasonal fruit, a type of berry, native from Brazil. The city has been performing the Jabuticaba Festival of Sabará for more than twenty-five years. The derivatives come from traditional recipes (from generation to generation) which is ‘considered a strong element of cultural manifestation of who resides in the municipality’.
  2. 26 October 2018, a Denomination of Origin was granted to bananas of the region of Corupá. The Association of Banana Growers of Corupá (Asbanco) in Brazil, made this application back in February 2018. While they wished to obtain the certification by the Banana Day celebration on the 18th April, they still managed to obtain it in 2018. The bananas grown in the region of Corupá claim to be the ‘sweetest in the country’.
Brazil recognizes two types of GIs: Indicação de Procedência and Denominação de Origem. The latter has a strong link with the regions as it recognizes the name of a country, city or region whose product or service has certain specific characteristics thanks to its geographical environment, including natural and human factors. An Indicação de Procedência does not require all links with the region (extraction, production and manufacture) but just one will suffice. Moreover, the specific characteristics due to their geographical environment be it natural or human factors are not required.

Free trade mark databases – the presence of Latin American countries

Have you heard of TMview? This is a common online trade mark information platform. The platform, a free of charge tool, makes trade mark data (registration and application) widely available and easily accessible to all interested parties. The platform is used in the EU and in the ASEAN region.

Talking about views..this is my view!
from the 19th floor of the Korean
 Intellectual Property Office (KIPO)
The European Union Intellectual Property Office (EUIPO) in the EU administers the platform. It has operated since April 2010 and contains information from all of the EU national IP offices, the European Intellectual Property Office (EUIPO) and a number of international partner offices outside the EU.

In Latin America, Mexico was the first country to participate, followed by Brazil, Colombia and in October 2017, Peru. These national IPOs made its trade mark data available to the TMview search tool.

Aside from TMview, there is also DesignView which operates as TMview, i.e., a platform that share data for industrial designs (application and registration) – Peru participates in this platform.

The new participant is Costa Rica, joining both the TMview and DesignView and so, it has now made available its trade mark (278,627 of them) and industrial design (1,700) data available to the EUIPO search tools. The number of trade marks in TMview is close to reach 50 millions (as of 06 November 2018).

Source EUIPO.