The new Intellectual Property Law in Chile: main changes

May 2021

Last April, the Chilean Chamber of Deputies approved the draft Industrial Property Law after more than two years in the National Congress. This project, which will now be sent to the Executive, will enter into force with the publication of its Regulations in the Official Gazette, six months after its promulgation.

In recent times, Industrial and Intellectual Property has not ceased to evolve, so that, consequently, the legislation on this matter in different countries around the world has also had to take a few steps forward. Chile has not been left behind.

With 129 votes in favour, 1 against and 1 abstention, the Chamber of Deputies has approved this draft, known as the “Short Law”, which updates the national intellectual property system and whose main objectives are: to facilitate processing, modernize processes and, above all, contribute to the harmonization of international standards.

What are the main changes and news?

This new Chilean law will bring a number of fundamental changes in the field of Intellectual Property, focused on, as we said, providing greater protection and enforcement of these rights and establishing registration procedures that are much more efficient than those that have existed until now, in order to facilitate the procedures for users. The most important new features are:

Non-traditional trademarks

The first new feature is the introduction of “non-traditional” trademarks. The requirement of graphic representation – already obsolete in the European Union and replaced by representation “in such a way as to enable the competent authorities and the general public to determine the clear and precise subject matter of the protection granted to its owner” – is excluded, which will allow in Chile the registration of three-dimensional marks, olfactory marks, tactile marks, moving marks, etc.

Provisional patents

Another novelty introduced by the Short Law will be the introduction of provisional patents, which will allow inventors, universities, research centers and companies that initiate proceedings to have twelve months to gather the necessary information. In this way, during this period, it will be possible to assess the viability of an application, as well as its scalability and protection, without losing priority.

Industrial designs

With regard to industrial designs and drawings, this new regulation makes it possible to opt for an abbreviated procedure for the registration of said figure, without the need for substantive examination, which may be carried out at a later date in the event of a dispute.

Expiry due to lack of use

Another of the changes brought about by this new law is the incorporation into the legislation of revocation for non-use. Until now, Chilean law did not provide for the compulsory use of the trademark, which resulted in a situation of saturation of trademarks in the market – and, of course, in the registry – which, in many cases, did not even have a commercial purpose and were not even used. This new draft seeks to solve this problem, so that trademarks will lapse for lack of real and effective use for a period of five years (the same as in the European Union as a whole). Likewise, a trademark that has become the usual designation of the product or service for which it was registered, because it has lost its distinctive capacity, may be sued for revocation. This was not provided for in the Chilean Intellectual Property Law until now.

Trademark counterfeiting offence and new compensation system

Before the approval of this new draft of “Short Law”, the use of another’s trademark in Chile was only punishable by a fine, whereas, at the international level, this illegitimate use can constitute a crime insofar as we can be talking about counterfeiting. The new legislation also establishes for the first time in the Latin American country the crime of “trademark counterfeiting”, which is punishable by a prison sentence of up to three years.

It also establishes a new sui generis compensation system that makes it possible to replace compensation for damages caused by a single “compensatory” sum determined according to the seriousness of the infringement, which can reach up to 130,000 dollars.

Limitations on trademark rights

Once approved, the law will allow certain legitimate uses of other people’s trademarks. That is to say, the right of a trademark owner may no longer prevent any person from using, in the course of trade, his name/pseudonym or the name of his predecessor in business, unless that name is likely to mislead or confuse the consuming public. This is more permissive than what has hitherto been prohibited.

Similarly, the owner of a trademark that incorporates geographical, generic or descriptive concepts may not prevent such concepts from being used when their purpose is to provide information on the geographical origin, genre or other descriptive characteristic of the product or service in question, unless, once again, this could lead to error or confusion among the public.

Removal of trademarks and industrial property marks

Finally, the “Short Law” eliminates the possibility of registering trademarks for commercial and industrial establishments in Chile – categories that no longer exist in the vast majority of neighbouring countries and in Europe – with the aim of standardising Chilean regulations with comparative law. Thus, only trademarks for goods and services are maintained, so that those owners of trademarks for establishments seeking renewal must do so as trademarks for goods or services, in order to respect the rights already acquired by their owners.

All in all, the new Chilean Intellectual Property Law represents, in the words of the Director of INAPI: “a qualitative leap, which allows us to face with more and better tools, our country’s challenge of becoming an increasingly relevant actor in terms of innovation, at an international level“.

Jorge Muñoz Wilson and Sara del Río

Sources:

https://www.inapi.cl/sala-de-prensa/detalle-noticia/proyecto-de-ley-corta-de-inapi-concluye-exitosamente-su-tramitacion-ante-el-congreso
https://lexlatin.com/opinion/registro-marcas-nueva-ley-propiedad-industrial-chilena