News on Trademark Filings

The landscape of trademark practice in Brazil is changing rapidly, with the Brazilian Patent and Trademark Office (BPTO) constantly adopting measures to try and improve trademark prosecution – often with mixed results – and various state and federal bodies moving up a few gears in the fight against counterfeiting.

Industrial Property Law 9279/96, which was enacted on May 15 1996, made significant changes to trademark practice in Brazil. In a nutshell, the most important changes were the express incorporation into the Industrial Property Law of the protection for well-known marks provided by the Paris Convention for the Protection of Industrial Property; the abolition of the special registration of a mark as notorious and the introduction of the incidental declaration of high reputation of a mark, which, once obtained, confers special protection to the mark in all classes for five years. These changes, with some exception, helped to build a framework for strong trademark protection in Brazil.

The courts have also been active in dealing with trademark infringements – an example is the recognition that infringement of a famous mark can lead to indemnification for moral damages as well as economic damages.

Another important development has been the introduction of specialized courts to deal with industrial property matters, at both federal and state court levels. The Brazilian Federal Court of Appeals for the Second Region, which covers the states of Rio de Janeiro and Espírito Santo, has implemented specialized panels and a section for the judgment of cases involving industrial property and IP matters. Specialization of the courts follows the creation in 2000 of federal courts of first instance to decide cases involving industrial property rights. It is hoped that specialization of the courts will increase both the quality and speed of decisions in the field of industrial property.

Despite the statutory, case law and court system improvements described above, one black cloud obscures the horizon for trademark owners and practitioners in Brazil: the backlog of trademark applications at BPTO has dramatically increased in the past ten years, to the point where it now takes over five years to register a trademark. The situation has deteriorated due to a lack of investment and sufficient human resources in the face of a significant increase in trademark filings. In addition, BPTO has taken on a number of projects in the past few years without putting the requisite structures in place. For example, it adopted the Nice Classification in 2000 without providing for a reasonable transition period, which contributed to the creation of a backlog of 6oo,ooo pending applications. These delays undermine the advantages stemming from the adoption of a modern law and threaten the whole system of trademark protection in Brazil. BPTO’s plan to clear the backlog includes the following measures: recruiting more staff – some 60 new trademark examiners have been hired this year; examining applications filed prior to 2000 under the provisions of the old Brazilian classification system; the same classification system is also being used for renewals filed after January 2000 which have not yet been decided; and suspending the paper publication of the weekly Official Gazette – all decisions are now published electronically only.

In addition, oppositions are now published almost instantaneously. In order to achieve this, BPTO publishes only the minimum information required for the applicant to know that an objection has been raised.

Because docketing and the management of physical files were singled out as major causes of delay, BPTO has decided no longer to accept paper filings. Aiming to become a completely paperless office, it now handles electronic filings only. On September 2006 BPTO rolled out a new online trademark application filing system called E-marcas. While the possibility to file trademark applications electronically is positive, BPTO’s decision to forgo paper applications entirely after the briefest of transition periods has proved controversial. Luckily for applicants, various difficulties in implementing E-marcas mean that the transition period has been extended several times so far.

What makes the transition to electronic filing difficult for applicants is the selection of the products or services relevant for each application. E-marcas enables applicants to select only products and services listed in the Nice Classification; applicants wishing to claim products and services that do not specifically feature in the classification need to consult the BPTO committee in charge of classification questions, which involves additional costs and a delay of approximately seven days per application. Therefore, applicants are strongly advised to claim only products and services specifically listed in the Nice Classification, but the limitation to the description of products and services does not apply to applications filed under a Paris Convention priority claim.

The decision to abandon paper filings led the Brazilian Association of Industrial Property Agents (ABAPI) to file a court action against BPTO on November 8, 2006 in the Federal Courts. In January 2007, the 3rd Panel of the Federal Court of Appeals prohibited the mere substitution of the traditional filing system due to several reasons the most important of them being the fact that the electronic filing would restrict access to the trademark system to those with internet access, thus hurting the Federal Constitution.

In the most recent decision, the BPTO decided to maintain the coexistence of the paper and on-line systems until July 1st, 2007.

As a matter of fact, the simultaneous maintenance of the two systems, as it occurs in the United States and in the European Union would have two main objectives: to guarantee full access to the trademark filing system and to allow the user to become acquainted with the on-line system which.

These changes are, overall, very positive to the Brazilian trademark filing system and, if they are properly implemented, should result in a streamlined service that will expedite the grant of trademark registrations.