1 August 2013Jurisdiction reportsEdith López-Bautista

Counterfeit issues in Mexico

Efforts to tackle counterfeiting include not only legislative amendments but also the implementation of strong and targeted measures and actions taken by the authorities.

The recent and most important legislative amendments in this area include amendments to the Criminal Code and the Mexican Industrial Property Law that took effect in 2010.

The amendment to the law allows the possibility that IP crimes are prosecuted ex officio. This provision is applicable only when items bearing counterfeit marks are sold to any end user or in public places wilfully and for commercial reasons. As to the Criminal Code, the amendment established that the majority of punishable conducts related to IP would be prosecuted ex officio.

Customs authorities have also been committed to the fight against counterfeiting. This is the reason that in 2011, the General Rules of External Trade were amended. This amendment contributed to creating the official database for Mexican trademark registrations, operated by Mexican customs.

With the creation of this official database, all trademark holders in Mexico are entitled to request the customs authorities to record their registered trademarks, in order to identify the importation of counterfeit goods that violate registered trademarks. This contributes to improving and increasing the detection of counterfeit goods as the execution of the proper criminal actions.

The holders of trademark registrations through their legal representatives, as well as customs authorities, have also been involved in the fight against counterfeiting. As primary stakeholders they participate in training courses for officers in charge of the detection of counterfeit goods at different Mexican borders. These sessions explain how to detect counterfeit merchandise in a practical and illustrative way.

The Mexican Institute of Industrial Property (IMPI) and some private associations are involved in this training, with the aim of improving the protection of, and culture of respect for, IP in Mexico.

But to one degree or another, despite these efforts, there are still legal shortcomings that interfere with the actions that can be implemented to improve the battle against counterfeiting in Mexico.

An example is the issue of containers in transit, which has become a significantly worrying situation for IP owners, as they are prevented from taking the proper criminal action against them. Currently, the authorities will not seize containers in transit if their final destination is not Mexico.

This was adopted in compliance with the analysis conducted by the administrative higher authority responsible for monitoring the proper application of the legal rules of the special unit of IP right crimes of the attorney general’s office (GAO). This authority considers that containers in transit can not be deemed as committing a crime, as the merchandise transported in those containers will not be imported or further commercialised into Mexican territory.

This has been contested by IP rights holders since, if it is true that the final destination of the merchandise may not be Mexico, it is also true that in theory the conditions required by the Criminal Code for the commission of the crime are met, given that the transport and introduction of the merchandise into Mexican territory is part of the elements required, alongside commercial speculation.

"That containers in transit can not be deemed as committing a crime, as the merchandise transported in those containers will not be imported or further commercialised into Mexican territory."

This means that if Mexico is used as intermediate step to bring the goods to their final destination, the merchandise has crossed into Mexican territory and can be considered as being introduced in the country. The reason for this is that in order to determine ‘introduction’ the completion of the import process is not necessary.

In line with the above, commercial speculation is also accomplished considering that the importation of counterfeit merchandise is not only about one isolated product but instead, it is the importation of complete containers with different counterfeit products which evidently are for commercial purposes and also, considering that most of the time the merchandise in the containers is sent to Central America as a final destination, that in fact, products usually return to Mexican territory through different means for their commercialisation.

Without question, this is an issue that seriously concerns trademark holders as they are prevented from enforcing their IP rights, and it has even been reflected in a decrease in sales. This is why some Mexican private associations involved with the protection of IP rights are pushing hard for the change of this criterion on an urgent basis.

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