MEXICO: An Introduction to Intellectual Property

Throughout 2023, the Mexican economy experienced a notable resurgence, solidifying its position among the world’s leading economic powers. According to the IMF, Mexico is now the 12th largest economy in the world, surpassing nations such as South Korea, Australia, and Spain. This achievement was reflected in GDP reaching USD1.81 trillion at the year’s end, marking an increase of nearly 30% compared to 2022. Furthermore, Mexico remained the second-largest economy in Latin America, trailing only behind Brazil.

Mexico’s economic resurgence was significant, successfully regaining its pre-pandemic level observed in the fourth quarter of 2019 by the second quarter of 2022. This recovery process spanned eight quarterly periods, following the contraction experienced in the second quarter of 2020. These encouraging figures have laid the groundwork for favourable investment conditions, making the country appealing to investors.

The strength of the Mexican peso has also been notable, partly explained by a significant interest rate differential between Mexico and the United States. This factor underscores the resilience of the Mexican economy in an international context marked by complexity and volatility. The nearshoring phenomenon and Mexico’s vicinity to the United States have been and will continue to be key. Together, these indicators reflect a promising economic outlook for Mexico, providing opportunities for sustained growth and long-term prosperity.

Overall, the favourable economic conditions in Mexico provide a conducive environment for the development of intellectual property by supporting innovation, creating market opportunities, facilitating collaborations, and nurturing entrepreneurship. With increased investment, stable legal frameworks, growing market demand, collaborative initiatives, and supportive ecosystems, businesses, research institutions, and entrepreneurs are incentivised to invest in research and development, create valuable IP assets, and capitalise on commercialisation opportunities.

As Mexico continues to strengthen its economy and focus on innovation, the cultivation and protection of intellectual property are poised to play increasingly vital roles in driving growth, competitiveness, and prosperity. Indeed, the country’s renewed commitment to intellectual property protection was demonstrated by the replacement of the Law of Industrial Property with the Federal Law for the Protection of Industrial Property (FLPIP), effective from 5 November 2020.

After three years since the new law came into effect, we are still adapting to the substantial changes introduced by FLPIP. Patents saw amendments regarding:

• patentable subject matter provisions;
• priority claims;
• double patenting;
• divisional applications;
• introduction of supplementary certificates;
• Bolar exemption;
• patent linkage;
• post-grant amendments; and
• the extension of utility model protection.

For trade marks, modifications included:

• the addition of non-traditional trade marks with an express recognition of trade dress, holographic, sound and scent trade marks (but, based on the drafting of the article, open to any sign perceptible by any of the senses);
• validity from registration date;
• a single examination process;
• redefinition of bad faith;
• clarified disclaimers;
• changes to notorious trade marks;
• modified declarations of use;
• removal of the license agreement recording requirement; and
• changes to the consent procedure.

Contentious matters involved changes to partial trade mark cancellation, damage claims, cancellation due to false declarations, res iudicata status for trade mark cancellations, and conciliatory proceedings, among others.

In addition to these changes introduced by the FLPIP, the legal framework surrounding trade marks in Mexico has undergone significant evolution over the past year, largely influenced by new court precedents. A key development is the confirmation that decisions regarding trade mark oppositions can be challenged in federal court. Also, the trade mark office is now required to maintain consistency when resolving cases involving similar distinctive signs. Another revision is that there is no statute of limitations for lodging cancellation actions based on certain grounds. These revisions promote legal certainty, fairness, transparency, and adaptability in trade mark law, nurturing a more competitive business environment and enhancing the protection of intellectual property rights in our country.

The introduction of non-traditional trade marks under the new law marks a progressive development in brand protection. However, there is still room for greater awareness and utilisation among domestic entrepreneurs. Among the non-traditional trade marks, trade dress registration has become particularly popular under the new law. 

Unfortunately, among the pending issues is the publication of the regulations to the FLPIP, which should have been done within the first year following the law’s enactment; therefore, its enactment has now become critical. Although the system continues to operate under the previous regulations, there are significant discrepancies that urgently need to be resolved.

Other pending areas of implementation relate to the use of certain procedural tools introduced by the law. These tools include mechanisms for infringement actions concerning trade secret violations and a procedure for the trademark office to determine damages. While the limited application of these tools so far can be attributed to the scarcity of cases reaching these stages, it is clear that after three years, their utilisation is likely to become more prevalent.

On the other hand, the Federal Copyright Law, which was also amended in 2020, introduced significant changes to provide greater protection to copyright or related rights-holders in the digital environment by regulating technological protection measures, rights management information, the liability of internet service providers, and the implementation of a “notice and takedown” system. This system has been widely used in recent years as it offers efficient removal of infringing content, aids compliance with legal requirements, protects service providers from liability, preserves intellectual property rights, and promotes fair use and freedom of expression.

Finally, in 2022, the new Federal Law for the Protection of the Cultural Heritage of Indigenous and Afro-Mexican Peoples and Communities came into effect. Its purpose is to recognise and guarantee the protection, safeguarding, and development of the cultural heritage and collective intellectual property of indigenous and Afro-Mexican peoples and communities, as well as comparable peoples and communities.

One immediate effect of the law has been to address the issue of cultural appropriation, particularly by international brands. This law has put a stop to the use of textiles, designs, and indigenous attire from various regions of the country by international brands, which took advantage of legal loopholes to engage in cultural appropriation. At the same time, the law provides specific mechanisms to request the necessary authorisations from indigenous peoples for the use of those creations they consider susceptible to commercial exploitation. The law may constitute the most advanced and ambitious legislation of its kind currently in force in the world; however, its implementation in practice still has a long way to go.

In conclusion, the recent legal changes and the economic resurgence witnessed in Mexico throughout 2023 not only solidified its position among the world’s leading economies but also set a promising trajectory for continued growth and development, driven by enhanced intellectual property protection.

Despite lingering challenges, Mexico’s proactive approach to legal and regulatory reforms showcases a forward-thinking mindset aimed at tackling emerging needs and opportunities. Collaboration among stakeholders, including businesses, government entities, and indigenous communities, will be crucial in unlocking the full potential of Mexico’s economic and cultural heritage. Through a steadfast commitment to innovation, inclusivity, and sustainability, Mexico stands poised not only to sustain its economic momentum but also to emerge as a global leader in intellectual property protection and cultural preservation.