Legislative reform hits the buffers

03-10-2016

Rodrigo Cooper

In 2013, the Chilean government sent a draft law to Congress aiming not just to modify industrial property legislation, but to completely replace it.

Chilean Law No. 19.039 was enacted back in 1991, and since then has undergone three relevant modifications with the goal of adapting our law to the TRIPS Agreement and the relevant free trade agreements (FTAs) signed with the EU and US. Notwithstanding this, there is consensus that Chile has not fulfilled all its obligations under the various international treaties it has signed in the last few decades.

Not only are international pharmaceutical research companies dissatisfied by the lack of compliance, users of the system agree that the law should be changed by introducing modifications to simplify it and, mainly, adapt it to modern times and Chilean reality.

The view is that the 19.039 law is outdated as it does not fulfil requirements of modern commerce and innovation. For example, 3D trademarks are not recognised and the use of registered trademarks is not required—in other words, a registration that is not used may not be challenged for lack of use and, even, may be renewed indefinitely.

"Unfortunately the draft, initially welcomed by all sectors of industry, has had a very difficult passage through Congress and is now practically stopped."

In patent matters there is no action for claiming ownership of non-previously disclosed inventions, which means that if the real creator files an opposition and it is upheld, the patent invention is rejected. This means the invention can be freely used by anyone, and the inventor’s rights mean nothing in the end.

Not only is the law outdated, but also its wording is quite complicated, as the successive modifications have introduced a large number of articles, eg “bis A”, “bis B”, “bis C” and even “bis K”.

The draft sent to Congress creates a fresh new law, keeping all the virtues of the current law, but modernising it by introducing new types of privileges of industrial property and deleting others that have proved useless. It also modernises and simplifies the administrative procedures to obtain privileges and, in this author’s opinion, in a limited manner enhances the enforcement of IP rights.

Unfortunately the draft, initially welcomed by all sectors of industry, has had a very difficult passage through Congress and is now practically stopped. This reflects that the issue is not a priority for the government, although it usually stresses the importance of innovation for the country.

In this same line of thinking, it should be assessed whether Chile is in fact willing to meet all the commitments under the international treaties it has signed. Just as an example, under the FTA signed with US in 2003 and in force since 2004, Chile committed itself to ratify the 1991 version of the International Union for the Protection of New Varieties of Plants (UPOV) before January 1, 2009.

Since 1994, Chile has been a member of the 1978 UPOV. Hence, in order to comply with the obligation imposed by the FTA with the US, the first government of President Bachelet sent to Congress, in December 2008, a draft leading to a law that adopted the UPOV 1991 version. The draft was discussed for a long time in parliament and, with modifications, was finally approved and ready to be enacted.

During the second government of Bachelet the bill was withdrawn from Congress in 2014 and, since then, nothing has happened. In this particular matter, there exists a strong pressure from environmentalist groups and politicians which, unfortunately, on many occasions repeat slogans without a full comprehension of the matters involved.

This leads to the conclusion that Chile, and perhaps other developing countries, do not currently analyse and take seriously the obligations of negotiating FTAs.

At the time of writing, it seems that the Trans-Pacific Partnership may be under threat as the two main US presidential candidates have mentioned that they do not approve of it. In addition, it should be considered that its approval by the Chilean Congress will not be an easy task, as there are many vested interests against it.

Rodrigo Cooper is a partner at Cooper & Cia and professor of IP law at the University of Chile. He can be contacted at: rcooper@cooper.cl

Rodrigo Cooper, Cooper & Cia, TRIPS Agreement, UPOV, trade agreements, patent, trademark, copyright,

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