Trade Marks 2022

Last Updated March 01, 2022

Chile

Law and Practice

Authors



SCR Abogados is a boutique firm specialising in intellectual property and labour and employment law. The firm works with clients from a diverse range of sectors, including software, pharmaceutical, fishery, catering, restaurants, hotels, laboratories, NGOs and medical devices, and has a client list that includes Fortune 100 companies, domestic and foreign entities and start-ups. SCR Abogados' intellectual property department assists clients in portfolio management and maintenance, licensing, enforcement and litigation. The department has specialised in trade mark protection and enforcement from an interdisciplinary view, assisting clients in their portfolio management, contracts with third-party vendors, employees and clients.

Trade marks are governed by the Chilean Industrial Property Act No 19.039 and its subsequent amendments (the “IP Act”). It should be noted that the IP Act and law No 20.254, which establishes the National Institute of Industrial Property (the "INAPI Act") were recently amended by Law No 21.355 (the "Law").

The Law was enacted on 22 June 2021 and advertised in the Official Gazette on 5 July 2021. However, it will have a deferred validity, since it will enter into force on the date of its advertisement in the Official Gazette of its regulations, according to the eighth transitional provision. Said provision grants six months to draft and publish the regulations and has not been advertised to date. This chapter was prepared considering the amendments that will soon come into effect.

Ancillary regulation can be found in other statutes such as the Plant Breeder’s Rights Act, Law No 19.342 (PBRA), the Unfair Competition Act, Law No 20.169 (UCA), the Free Competition Act Law-Decree No 211 (FCA) and the Border Measures Act, Law No 19.912 (BMA), among others.

Chile has a civil law system and, therefore, case law is not binding.

Chile is a member of the Paris Convention, the Madrid Protocol, the Agreement on Trade-Related Aspects of Intellectual Property Rights (the "TRIPS Agreement") and the Trademark Law Treaty (TLT).

The IP ACT sets out provisions on:

  • trade marks and service marks covering goods (classes 1-34), or services (classes 35-45);
  • slogans (dependent on previously registered marks and to be used in association therewith);
  • collective marks (aiming to warranty the nature or quality of goods or services);
  • geographical indications and appellations of origin; and
  • non-traditional marks (including sound, smell and three dimensional marks)

There are no statutory marks protected under the IP Act.

Section 20 (g) of the IP Act contemplates the existence of foreign registered trade marks as a relative ground for refusal provided that they are well-known or famous in their country of origin.

Chilean trade marks have a protection term of ten years counted as from the registration date, renewable indefinitely for ten-year periods.

The exceptions to this rule are slogans and geographical indications (GI) and appellations of origin (AO). Slogans expire along with the mark on which they depend, and GI/AO have an indefinite duration.

Section 19 bis E of the IP Act expressly contemplates the exhaustion of trade mark rights as follows: “The right conferred by a trademark does not allow its owner to prevent third parties from using the same in connection with products legitimately commercialized in any country under the said mark by the owner or with its express consent”.

Section 25 of the IP Act indicates that “Any registered mark used in commerce shall bear visible markings indicating “Marca Registrada” the acronym "M.R." or letter "R" within a circle.”

Omission of this requirement does not affect the validity of the registered mark, but deprives a non-compliant owner from exercising their rights against criminal actions contemplated in the IP Act.

Section 14 of the IP Act indicates that any agreement concerning a trade mark registration needs to be in writing. The practice of the Chilean National Industrial Property Institute (INAPI) has been to request documents to be signed at least in blue ink, and preferably before a notary public.

Assignments may refer to registered marks or pending applications. In the first case, an assignment form must be recorded and a tax needs to be paid per registration (regardless of the number of classes covered therein). In the latter, a brief referencing the assignment suffices. No taxes are due in connection with pending applications.

The assignment both for registrations or pending applications needs to be approved by the INAPI to confirm formalities have been met and/or that the assignment is not likely to cause confusion among consumers. This is particularly possible with partial assignments, although it is rare for the INAPI to object an assignment on substantive grounds.

Similar to assignments, licences need to be in writing and shall be recorded before the INAPI on each of the trade marks included in the agreement. Recording the licence is subject to a tax per registration, against which the licence is recorded.

No substantive review from the INAPI is performed. Recording the licence is a formal proceeding and operates in the same manner as for assignments.

As to the contents of the licence, they can be freely determined by the parties without there being substantive restrictions in the IP Act which limit the autonomy of the parties. Accordingly, they may be exclusive, non-exclusive or sole licensees, for limited or perpetual duration, limited territories or worldwide, potentially subject to payment of royalties, potentially contemplate minimum payments, and may include any other term agreed by the parties.

Absence of registration does not affect the validity of the licence between the parties but the terms of the same are unenforceable against third parties. Absence of registration of the assignment does not transfer title as the trade mark registry is administered by INAPI.

The problem of failing to record an assignment or licence is that this may result in a third party acquiring the trade mark in between and recording the acquisition thus affecting the prior assignment which it will not be possible to record.

Absence of registration of a licence may make the same unenforceable against a successor of the licensor should the trade mark be assigned after the licence was granted thus affecting the licensed rights.

In order for an assignment agreement to be valid, it needs to be in writing and subsequently recorded before the INAPI. No special mentions are necessary to record an assignment other than the registration number and identification of the mark being assigned.

Licence agreements are not reviewed from a substantive standpoint by the INAPI but subject to a formal review to confirm that the trade mark(s) involved have been correctly identified in the agreement.

It is possible to assign a pending application subject to a formal declaration from the owner assigning the same within the application process. There is no need to pay fees to record the assignment of a pending trade mark application.

As to the possibility or licensing an application or even a non-registered mark, it is worth pointing out that while an agreement may grant a licence over a non-registered or a pending trade mark application, it will not be possible to record such agreement unless there is a trade mark registration, accordingly, while the agreement will be valid between the parties, it may not be enforced against third parties.

The IP Act expressly contemplates this possibility subject to the document wherein the security is given is in writing and subsequently recorded before INAPI. Again, a tax is due for recording this lien or security.

While the IP Act in its Section 2 recognises rights stemming from use of a trade mark, trade marks, as with any other industrial property right (IPR), are consolidated upon registration with the INAPI.

THe INAPI’s Trademark Under Directorate is responsible for the trade mark registry. 

There is an open database detailing trade mark registrations made since the late 1980’s. This is customarily consulted in the context of a prior rights search before applying for a mark.

Third-party vendors search databases with images and/or similarity indexes, and the same are usually consulted in availability searches.

The registration of a trade mark may take approximately six months, counted from the filing date, provided there are no ex-officio actions from the INAPI and/or opposition statements. In such cases, the registration procedure may take up to ten or 12 months.

It is not possible to refresh an application. The only possible amendment relates to re-classification upon renewal in light of differences between the classification applicable by the time of the registration and the relevant renewal.

Additionally, a registration can be limited by eliminating goods or services. Adding goods or services to the description is not permitted.

The application may be filed on paper or in e-format. It will be necessary to identify the applicant and the representative (where applicable), one of which will need to have a Chilean tax ID number. If the mark includes a device, the same must be submitted in jpg or png format.

Trade marks may be registered in the name of anyone holding a recognised legal capacity (individuals, corporations, funds, etc).

Any symbol suitable for graphic depiction may be filed as a trade mark. These can consist of words, including names of persons, letters, numbers, figurative elements such as images, graphics, symbols, combinations of colours, sounds, as well as any combination of such signs. The amendment to the IP Act incorporated scent and three-dimensional trade marks.

Multi-class applications are allowed for goods, services and combinations thereof.

Chile does not contemplate a use requirement to file a trade mark application. A trade mark that has been used in commerce prior to its registration may serve as a ground for refusal of an application, provided that such sign has been actually used in Chilean territory. Additionally, generic marks may be registrable provided they have gained secondary use.

Chile does not set forth provisions regarding series marks.

Prior registrations are considered as relevant to registrability in Section 20 of the IP Act. Relevant sections are:

  • 20 (c) symbols which correspond to the name, pseudonym or portrayal of an individual;
  • 20 (f) likelihood of confusion as to the source or origin of goods or services;
  • 20 (g) likelihood of confusion with prior foreign registrations which are well-known or famous in their country of origin;
  • 20 (h) likelihood of confusion with prior Chilean trade mark registrations, trade mark applications or non-registered trade marks used in Chile; and
  • 20 (k) symbols against good faith and commercial practice.

The INAPI usually grounds objections on grounds (c), (f), (h) and (k). Prior foreign registrations and non-registered Chilean trade marks must be asserted by interested third parties in opposition proceedings.

Interested third parties (who feel the potential grant would impact their existing rights) are allowed to file an opposition on the basis of relative or absolute grounds for refusal, which may apply in connection with a given application (Section 20 of the IP Act).

Upon advertisement of the trade mark in the Official Gazette, there is a 30-working day term to file an opposition. The opposition should be filed in writing in form of a complaint, including a section for facts and another for legal arguments, and should be signed by a practising attorney.

There are no third-party observations contemplated in the IP Act other than oppositions. However, the INAPI may issue ex officio office actions if the examiner deems any of the grounds for refusal apply in connection with a trade mark application.

The threshold for having standing is to be an interested third party, and no special requirement is set in the IP Act.

It is possible to correct or amend errors and/or omissions in the identification of applicant, description of goods or services, translations and any other formal errors by submitting a request with the INAPI. If there is any doubt, supporting evidence will be requested. New items cannot be added to the description of goods or services after the filing.

It is possible to withdraw an application before registration is granted. After it is granted, it is possible to cancel a registration either totally or partially.

Pursuant to Section 21 of the IP Act, while an application covering several classes is still pending, its owner may divide the application, upon request, into one or more “divisional applications” indicating the distribution of goods/services. Each divisional application is considered a new application for formalities and fee payment purposes, but maintains the original application’s priority date.

There are no special sanctions for misrepresenting information included in a trade mark application. However, if it was made in bad faith or in a grossly negligent manner, this may affect the statute of limitations for a potential cancellation action; if the misrepresentation was material and made in bad faith, there is no statute of limitations defence in such proceedings. The burden of proof will lie on the plaintiff.

The cancellation will be prosecuted and decided by the INAPI.

Section 20 of the IP Act contemplates several absolute grounds for refusal in the letters listed below:

(a) shields, flags, emblems, acronym or names of countries, international organisations and public agencies;

(b) as related to an object, technical or scientific names, names of plant varieties, DCI or INN set by the WHO or therapeutical indications;

(d) reproductions or imitations of quality control symbols adopted by a government absent its authorisation; or, of medals, diplomas or distinctions granted in foreign fairs or meetings, unless requested by an awardee;

(e) expressions or symbols used to express genus, nature, source, nationality, origin, use, weight, value or quality of goods, services or establishments; expressions or symbols which are of common use of lack of distinctiveness;

(i) colour or shape of products or containers;

(j) likelihood of confusion with geographical indications or appellations of origin; and

(k) symbols against public order, morality and civility.

It is possible to file a response with the arguments in support of registerability against an office action issued by the INAPI during the prosecution of an application. For this purpose, the applicant has a 30 days to submit a response. Any refusal (whether resulting from an opposition or an office action) may be appealed before the Industrial Property Court within 15 days, counted from the date of service of the decision. Appeals need to include factual and legal support, concrete requests, be signed by a practising attorney, and the payment of appeal fees (approximately USD150).

Any refusal on formal grounds may be subject to a review by the National Director of the INAPI. The National Director, as head of the agency, will issue a ruling on the basis of administrative law principles and rules.

In May 2021, the Chilean Congress approved the participation of the Madrid System. However, the effective date of entry into force is of three months after the deposit of the instrument before the WIPO, which is programmed to occur in early 2022.

Upon publication of the trade mark in the official gazette there is a 30-working day term to file an opposition.

The opposition deadline is non-extendible.

Legal grounds for filing an opposition can be found in Section 20 of the IP Act (see 4.4 Consideration of Prior Rights in Registration and 4.9 Refusal of Registration).

The UCA impliedly recognised dilution as grounds for legal action and, indirectly, could serve to ground an opposition under Section 20 (k) of the IP Act.

Any interested third party (namely anyone whose rights may be affected by the grant of the applied mark) can file an opposition.

Since the opposition is a legal action, the individual or entity filing an opposition needs to be sponsored by a practising attorney.

There are no official fees associated with the filing of oppositions. Legal fees vary between practitioners and are customarily fixed-fee arrangements, hourly rates for evidence term, or fixed fees for appeals.

Depending on the grounds for the opposition, the opponent may require to hold a prior registration or application, but oppositions may be grounded on absolute grounds for refusal and on non-registered marks as well.

The opposition procedure begins with the filing of an opposition statement. The same is reviewed by an examiner of INAPI to confirm that formal requirements of the opposition are met and, at the same time, will perform a substantive analysis of the application. If there are formal defects on the opposition statement, the examiner will point them out to the opponent. If the examiner deems there are grounds for refusal (which may be the same as those on which the opponent grounded its opposition), the INAPI will issue a substantive office action.

The opposition, along with a potential substantive office action, is served to the applicant who will be given a 30-working day term (to respond them both if there is an office action). If there are disputed facts between the parties, an evidence term is opened (usually when grounded on Sections 20 (f), (g), (h) or (k)). The evidence term is of 30 days and may be extended for additional 30 days. There is no discovery in these proceedings.

After the response term elapses and once the evidence term elapses, a decision is rendered. The decision may be appealed before the Industrial Property Court.

The opposition procedure before the INAPI is resolved through motion practice. The proceeding before the Industrial Property Court is resolved in a hearing.

The decision of INAPI may be appealed by the losing party (or by both parties if the decision partially affects them). The term for filing an appeal is 15 days, counted as from the date of service of the decision.

Once appealed, the appeal brief is reviewed on formal grounds by the INAPI. If all requirements are met, the case file is sent to the Industrial Property Court. Within approximately three months, counted as from the date of delivery of the case file to the Industrial Property Court, a hearing is set and a decision is rendered on the same day of the hearing or shortly after.

The decision of the Industrial Property Court may be subject to an annulment recourse to be heard by the Supreme Court. Such recourse cannot challenge the facts of the decision but only the legal arguments. Annulment recourses can take 12 months or more to be heard.

The statute of limitations for filing a cancellation action on a mark which should have been rejected due to the application of grounds for refusal at the time of their registration is five years counted from the registration date. If the registration was obtained in bad faith, the statute of limitations does not apply.

In regards to total or partial cancellation actions grounded on the non use of a registered mark (or on tolerating a registered mark to become of general use to designate goods or services), the minimum term of non use (or tolerance as the case may be) is of five years.

A cancellation can be grounded on a wrongful grant. Accordingly, any ground for refusal of an applied mark which may have been applicable by the time of the filing of the application (currently those of Section 20 of the IP Act) can be used to ground the cancellation action.

New Section 27 bis A et seq of the IP Act contemplates additional grounds for cancellation:

  • the non use of a mark for a continued five-year period; and
  • when the owner has tolerated the use of a mark to designate a good or service for which it was registered to the point where it has become a general denomination for the same.

The burden of proof concerning the use of the mark will lie in the trademark owner with exceptions associated to impossibility to use the mark. Also, when a non used mark is used to ground an opposition or cancellation action, cancellation grounded on non use may be requested when responding to the opposition.

Any interested third party (to whom the cancellation of the mark may affect) may request a cancellation. Grounds for cancellation will need to relate to the plaintiff and, for the cancellation to proceed, should apply by the time of the filing of the trade mark application whose cancellation is sought.

If the cancellation action is grounded on non use, it has to be continued non use for five years prior to the cancellation action’s filing date. For marks registered prior to the entry into force of Sections 27 bis A et seq of the IP Act the five year period will be counted as from the first renewal after the date in which the said section came into force.

Cancellation under Section 27 bis A may not be declared ex officio.

The competent court to hear cancellation actions against trade mark registrations is the head of the INAPI.

If the cancellation action affects only a part of the goods or services a partial cancellation may be filed. In this sense, the ruling issued by the INAPI must correlate to the request put forward by the plaintiff.

The trade mark owner may cancel its trade mark registration, totally or partially, at any time. No amendments are allowed on existing descriptions of goods or services unless they constitute limitations. The proceeding of a cancellation action can conclude before the issuance of a final ruling. The causes of early termination can obey to:

  • dismissal of the lawsuit on formal grounds or the abandonment of the proceeding;
  • settlement between the parties; or
  • acceptance of the claim by the defendant.

The competent courts differ. Cancellation actions are heard by the head of the INAPI, whereas infringement actions are heard by the competent civil or criminal court.

Since proceedings, competent courts and available recourses differ, timelines for decisions in cancellation and infringement actions will differ accordingly.

Fraudulently registered marks would be considered obtained in bad faith and would be liable for cancellation if any grounds for refusal applied by the time of their registration, without statute of limitations provisions being applicable to them.

Criminal actions have a statute of limitations of five years, counted from the date on which the infringing act took place.

Civil actions have a statute of limitations of four years, counted from the date on which the infringing act took place.

Pursuant to the IP Act, criminal actions are available for malicious use, to commercial ends, of a sign identical or similar to a registered mark, as long as it is used in connection with the same or related goods or services compared to those included in the description.

Likewise, the IP Act contemplates civil actions for the unauthorised use of a sign identical or similar to a registered mark.

Unregistered marks cannot serve to ground infringement actions pursuant to the IP Act. However, if the unregistered mark has goodwill which is being taken advantage of by a third party, the owner of the unregistered mark may file a civil action grounded on the UCA.

There are no special grounds for action based on dilution or cybersquatting, however, trade mark owners facing dilution or cybersquatting situations may bring action under the IP Act, the UCA or general tort rules depending on the facts of the case.

Any interested party and the trade mark owner of record are recognised as having standing to bring an infringement action.

While Section 19 bis D of the IP Act recognises the trade mark owner as the potential claimant, Section 107 of the IP Act recognises this possibility to any interested party. Accordingly, if an interest can be asserted (and potentially evidenced), an infringement claim may be brought by a licensee.

Pending trade marks do not give rise to trade mark infringement actions under the IP Act. Prior to registration, an action may be brought grounded on the UCA or general tort rules.

Representative or collective actions on trade mark infringement are not regulated in Chile.

Any type of action must be duly filed by an acting attorney.

Only criminal actions, as noted in 1.7 Symbols to Denote Trade Marks, require the marking requirements to have been met for criminal action to be available.

Any threat to sue may be responded to with a formal request to sue pursuant to the same within a given time frame as set out in the civil procedural code. If the action is not brought within the said timeframe, the action lapses and cannot be filed subsequently on the same grounds of the threat.

Misuse claims can be asserted pursuant to the UCA or antitrust rules.

Since the competent court hearing infringement actions is an ordinary court (civil or criminal) pleading standards are the same as those in non-intellectual property proceedings.

All arguments should be put forward in the initial complaint in writing and the response should also be made in writing. Additional arguments may not be put forward afterwards.

The defendant can initiate a counter lawsuit in response, although it is arguable whether the same can be pursued in the same trial.

Prior to the entrance into trial, it is possible to file pre-trial motions in order to gather evidence to support the claim. Remember there is no discovery in Chile.

Regarding the trial, for civil actions, the claim must be filed before a civil court of justice, in accordance with a summary procedure (ie, request, response and evidence hearing, evidence term, observations to evidence presented by the parties and decision) whereas the criminal proceeding requires marking requirements and involvement of the prosecutor’s office. Criminal cases will be tried before a criminal court.

Against a decision from a civil court, it is possible to file an appeal before the corresponding Court of Appeals. In turn, against the decision from the Court of Appeals it is possible to file an annulment recourse before the Supreme Court.

Regarding criminal procedures, the final decision is subject to an annulment action to be heard by the Court of Appeals or the Supreme Court, depending on the cause of action of the referred recourse.

Before filing a lawsuit, it is advisable to notarise evidence, send cease and desist letters, and potentially file pre-trial evidence motions. The costs of notarisation and notary-certified cease and desist letters is relatively low. The cost for pre-trial motions will depend on the legal fees for counsel and the costs of service.

Representation by counsel is required to appear before an ordinary court of law (civil or criminal).

In principle, the trade mark office has no bearing on infringement action decisions. The competent court is the ordinary civil or criminal court. However, since the registration may be cancelled by the head of the INAPI, pending cancellation actions may lead to the issuance of stays before ordinary courts or, in the event of cancellation, to a ground for rejection of the infringement claim.

There are no declaratory judgment proceedings in Chile for trade marks.

Civil and criminal actions encompass the remedies addressing counterfeit marks. Also, to prevent counterfeit imports, it is possible to record registered trade marks before Customs.

In connection with imports in particular, the BMA allows trade mark owners to request to the competent court (that where the import will actually or presumably be made) to suspend the delivery of goods that violate their registered trade marks. The court may grant the measure without hearing the alleged infringer requiring the holder to provide a guarantee or bond to respond for damages in the event that the request lacks grounds.

Court orders instructing customs authorities the suspension of delivery of goods will be served to the competent customs authority. The order will be valid for ten working days counted as from the date of service of the resolution or suspension of the delivery (whichever is earlier). If the delivery of allegedly infringing goods is suspended, the mark owner must file a complaint (civil or criminal) while the suspension is valid or request an extension for additional ten days grounded on qualified reasons. If the extension is not granted, the complaint is not filed or if filed the upholding of the suspension measure is not requested, the measure will expire.

In addition, pursuant to Section 16 of the BMA, customs authority may order ex officio the suspension of the delivery of goods, when from a simple examination it is apparent that they infringe third party trade marks. Customs will order the suspension of the delivery of goods and shall inform the trade mark owner who will have a maximum period of ten business days to file a complaint requesting the suspension to be upheld, otherwise, the goods will be released.

Infringement cases are tried under summary trial rules (complaint, response hearing, evidence and decision). The particularity of the summary procedure is that the judge, once the claim and the defence are filed, summons both parties to a conciliation hearing. In said hearing, the parties will confirm their presentations, and the court provides the possibility of arriving to a settlement. However, the parties can persevere with their pretensions, after which the court will open an evidence term.

The case is determined by a judge who does not necessarily have a trade mark background.

The parties have no influence on the decision maker as the general rules of jurisdiction determine which judge will be competent to hear the case.

Although advisable to establish trade mark use by the time of the filing, it is not necessary to do so in order to file an action. In order to prevail in such action (both in civil and criminal proceedings), evidence of use is necessary for a purely descriptive use will not infringe a mark.

Regarding the cause of action for a civil infringement lawsuit, the plaintiff only has to prove the likelihood of confusion among consumers and not the real effect that the unauthorised use of the trade mark had on consumers. Thus, such likelihood of confusion shall be assessed by the court by comparing the marks, both on their external appearance and on the goods or services covered thereby. As mentioned earlier, use of a trade mark is not mandatory for infringement purpose, however, the court may consider such element.

As to criminal actions, the plaintiff will need to be able to prove wilfulness of the use and the commercial purpose of the same, in addition to the likelihood of confusion between the conflicting trade marks.

Notwithstanding the aforementioned, since Chile is a civil law country where court decisions are not binding for future cases, infringement will be determined on a case by case basis based on the merits of the claim and defence. However, courts may apply their own criterion used irrespective of prior decisions.

Under the IP Act unauthorised use is the cornerstone for an infringement action. Under the UCA, any use likely to divert by unlawful means clients to a competitor by unlawful means. This could encompass cybersquatting and dilution in general.

Trade marks are valid as from the date of registration before INAPI, therefore, from that moment onwards a registered mark will be enforceable erga omnes. In this sense, the holder of the trade mark will have an exclusory right to prevent unauthorised use. Further, the unauthorised use of a mark identical to a registered trade mark, and concerning the same goods or services, is presumed to be an infringing use.

There is no closed list of defences. Any defence which may dispute the assertions of the plaintiff in its claim is valid. That said, the usual defences and non-infringing use (outside of the scope of the registered mark), authorised use whether by contract – in case of a licence – or implicit authorisation, ie, estoppel, laches or acquiescence.

The IP Act expressly contemplates good faith of the distributor as a defence in Section 109 (when they have marketed products manufactured or produced by third parties or with knowledge of the infringement) and the first sale doctrine in Section 19 bis E. Defences grounded on own-name and violation of competition law can be asserted.

Priority has very limited application as it is contemplated for a limited period of time (180 days) counted as from the registration.

Objection on non-use is unlikely to be considered as a sole argument as there is no use requirement to bring civil actions.

Forfeiture, limitations or abandonment could have a better result if a mark was indeed abandoned or limited excluding the objected use.

It is possible to file a pre-trial motion requesting access to documents from the future defendant as long as such access is necessary to bring action against it. To this end, a motion is filed before the competent court and the same will review the request and grant the same if, in its sole judgment, the request has merit. The access to documents does not include confidential documents.

During a trial, such request can be made during the evidence term.

In trade mark matters, surveys and experts are not usually relied upon by courts. Experts in Chile (for court purposes) are only those registered as such with the relevant court of appeals. Such experts are not trade mark experts and thus their reports are usually not useful.

Surveys and reports produced by the applicant are considered documents for the purposes of assessing their merit.

Criminal actions are available in case of wilful infringement of a trade mark for a commercial purpose.

There are no fees due to the judge. There is a free access to justice principle in Chile and, thus, ordinary courts are not subject to the payment of any fees to the parties. Arbitration tribunals are subject to remuneration. Also, court proceedings performed by court officers may be subject to fees for the service of summons, recording of hearings or issuance of expert reports, as the case may be.

This said, attorney fees may be substantive (especially relative to court costs) depending on the fee arrangement with the attorney of record.

All injunctions available under civil procedure are available for trade marks. In addition, the IP Act contemplates in Section 112 additional injunctions for:

  • prohibiting the continued acts of alleged infringement;
  • the designation of a court appointed manager to seize allegedly infringing goods and manufacturing implements, including labels, containers, advertising material bearing the allegedly infringed mark;
  • the appointment of an administrator;
  • prohibition to advertise or promote the allegedly infringing goods; and
  • withholding of the proceeds of sales of allegedly infringing goods.

Section 108 of the IP Act contemplates general rules for damages under civil law (actual damages) or, at the plaintiff’s choice:

  • profits lost by the plaintiff as a direct result of the infringement;
  • disgorgement of profits by the alleged infringer; or
  • a reasonable royalty rate.

The judge can only issue a pronouncement on the choice made by the plaintiff and over the basis of the evidence on record.

Additionally, in case of counterfeits, upon request of the plaintiff, damages may be substituted by a discretionary amount to be set by the court not to exceed of UTM2000 (approximately USD125,000). 

Criminal actions contemplate the impoundment and destruction of infringing goods. The means for the manufacture of the infringing goods may also be impounded and subsequently destroyed or distribution for the benefit of others at the criminal judge’s choice.

There are no court fees for tribunals. Court proceedings performed by court officers may be subject to fees for the service of summons, recording of hearings or issuance of expert reports, as the case may be. All of them are to be paid by the interested party (usually the plaintiff).

The losing party may be ordered to reimburse the prevailing party’s court costs and attorney fees (the first as evidenced by receipts and the latter as assessed by the court) only if the plaintiff wins on all counts and, even then the judge may exempt the losing party from paying such fees if they deem the said party had plausible reasons to litigate.

The trade mark owner can seek injunctive relief with the court without notice to the alleged infringer, even prior to the beginning of the trial, provided that it indicates the action it intends to file and its grounds, there is fear of irreparable harm and substantive antecedents of the infringement. The court may request the issuance of a bond or security. If the pre-trial request is granted, a formal lawsuit shall be filed within ten days, extendible for up to 30 days.

There is a declaration of non-infringement and, if the plaintiff is fully defeated and the court deems it had no valid reasons to litigate, award of costs. 

Pursuant to the BMA, once a shipment is detected, and provided the owner has recorded trade marks with customs, a notice will be sent to the owner to inform of the shipment. If deemed counterfeit, the trade mark owner is entitled to request the shipment not to be released.

The shipment will be detained for up to ten working days, term in which the owner must bring action. Otherwise, the shipment will be released. If it is an evident counterfeit, customs may act ex officio.

Remedies do not differ for different types of trade marks.

In litigation scenarios, in principle, the parties may settle the dispute before, during or even after a ruling is entered as long as they are in agreement and reciprocal concessions are made. In the context of a civil trial, there is a mandatory call to settle the existing dispute following the discussion phase. The court will propose terms for a settlement and will present them to the parties who may, or may not, agree to them. They can further propose settlement terms ex officio prior to a judgment being entered.

Alternative Dispute Resolution (ADR) for trade mark disputes is not mandatory nor is there a legal body contemplating that possibility in particular. That said, contract provisions may lead to the settlement of trade mark disputes between the contract parties before an arbitration tribunal.

There are other ADR such as conciliation and mediation, however, with regards to trade mark cases these are not often used.

In theory, other court proceedings do not have influence on any current proceedings. The courts have a duty to decide on the merits of the facts on record as they exist by the time of the decision making. However, on occasion, courts do issue stays to prevent conflicting decisions from being issued.

The decision of the first instance court on an infringement case may be appealed before the relevant Court of Appeals. This is true for the decision on the merits of the case and for several ancillary decisions within the process.

The term to file an appeal before the civil court is of 15 days (monday to saturday) and, depending on the Court of Appeals, rulings take from ten to 12 months to be issued.

Since infringement cases are resolved before civil courts of justice, the applicable rules are those contained in the Civil Procedure Code. In this sense, appeals will be prosecuted as a regular recourse.

The review of infringement cases on appeal by the relevant Court of Appeals, and that of the Industrial Property Court in cancellation or application proceedings, is a full review (factual and legal) with the possibility of adding new evidence if available.

The review of the Supreme Court on annulment recourses is only legal.

If a symbol is eligible for protection under the copyright act and the IP Act there is no objection to double protection.

Moral rights cannot be waived. However, in practice, this is not an issue as most works eligible for protection under copyright law are created under work for hire provisions from corporations who secure the relevant rights and authorisations to the entity acquiring the same.

There are no grounds for refusal based on copyrights or related rights. However, if clearly identified with the author, said author may ground an opposition under Section 20 (f) or 20 (k) on its copyright.

There is also no incompatibility between both statutes with regards to related rights.

An amendment introduced by Law No 21.355, referred to in 1.1 Governing Law, contemplates the possibility to register three-dimensional trade marks. Prior to this amendment, shapes of goods were only protectable by industrial designs.

There is no specific recognition of publicity rights in Chilean legislation. However, case law of superior courts has recognised them under constitutional principles such as privacy provisions for any individual who may be identified from a given image.

Regarding trade mark protection, it is possible to register the portrayal, pseudonym or name of an individual, provided there is consent of that person or of their heirs where they are deceased. The names of historical figures may, however, be registered if at least 50 years have elapsed since their death, and on condition that their honour is not thereby prejudiced.

The UCA supplements the IP Act and provides examples of specific unfair competition cases, as well as a general unfair competition definition which assists to the enforcement of rights which may derive from the commercial exploitation of goods or services protected under trade mark provisions. The cause of action applicable to unfair competition is normally the cessation of acts which may affect the trade mark holder in the market.

First, and most relevant, is the issuance of Law No 21.355, referred to in 1.1 Governing Law, which amends the IP Act. The most relevant issues which are subject to amendments or incorporations are:

  • the revision of the definition of trade mark and the possibility to protect scent and three-dimensional signs; 
  • a new counterfeiting offense which now carries imprisonment and statutory damages;
  • further regulation of collective and certification marks;
  • non-use cancellation action;
  • further regulation of geographical indications and appellations of origin; and
  • adherence to the Madrid System (pending entry into force).

There is no specific regulations for trade marks in the Internet as such. The most relevant connection is the Chilean domain name UDRP arbitration system which, in general, settles revocation claims in favour of trade mark owners.

The CIPA establishes exceptions to trade mark rights in 19 bis D, 19 bis E and 109. Of these, 19 bis D indicates that a registered mark may be used as it was registered, 19 bis E sets out the grounds for a first sale doctrine to apply and lastly, Section 109 exempts distributors of goods from liability associated to their distribution if the same were not manufactured by them and they did not know they were infringing third-party rights.

SCR Abogados

Avda. Isidora Goyenechea 2934
oficina 403
Las Condes
Santiago
Chile

+56226048321

Jfreyes@scr.cl www.scr.cl
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SCR Abogados is a boutique firm specialising in intellectual property and labour and employment law. The firm works with clients from a diverse range of sectors, including software, pharmaceutical, fishery, catering, restaurants, hotels, laboratories, NGOs and medical devices, and has a client list that includes Fortune 100 companies, domestic and foreign entities and start-ups. SCR Abogados' intellectual property department assists clients in portfolio management and maintenance, licensing, enforcement and litigation. The department has specialised in trade mark protection and enforcement from an interdisciplinary view, assisting clients in their portfolio management, contracts with third-party vendors, employees and clients.

Amendment of the Industrial Property Act 19.039 (the "IP Act") and Law No 20,254, which Establishes the National Institute of Industrial Property (the "INAPI Act")

On 5 July 2021, Law No 21,355 was advertised at the Official Gazette (the "Law"), which amended the IP Act and INAPI Act. It is worth noting that even though the Law was advertised in the Official Gazette, an act that generally determines the entry into force of any act or regulation, the same will have a deferred validity since it will enter into force on the date of advertisement in the Official Gazette of its new regulations, according to the eighth transitional provision under the Law. Even though the said transitional provision grants six months to draft and publish the regulations, the same has not yet been advertised.

The Law introduced multiple amendments with regard to trade marks and new institutions, of which the most relevant will be covered here.

Non-use cancellation action

One of the most notable amendments introduced by the Law is the incorporation of a non-use cancellation actions, which may proceed in any of the following scenarios:

  • no actual use of the mark within Chile, either by the holder or an authorised third party, during a period of five years counted from the registration, or if such use had been suspended for the same continued period of time; or
  • if its holder has caused or tolerated a registered mark to become the usual designation of a good or service for which it is registered.

Regarding the second cause of action, it will not be understood that the usual designation has been tolerated or caused if the holder has made use of the markings that evidence that the respective mark is registered.

Regarding the burden of proof of the use of a mark which is argued to be unused, this will correspond to its holder. The actual use of the mark shall be proved by any evidence admitted by the IP Act (ie, confessional evidence is discarded). In case of failure to prove the use, the mark will be liable to be cancelled either totally or partially. The action may only be filed by whoever has a legitimate interest in the non-use cancellation.

A noteworthy aspect is that the non-use cancellation action may be filed as a counterclaim to a claim for cancellation of registration or opposition, which will be prosecuted jointly in a single procedure before the National Institute of Industrial Property (INAPI).

Regarding the scope of the non-use cancellation, it may be total or partial. In other words, the part of the coverage for which the mark was not cancelled will be maintained.

Finally, in application of the fifth transitional provision of the Law, the non-use cancellation action shall be available only to trade marks granted or renewed after the entry in force of the Law.

New non-traditional trade mark categories acknowledged

Another interesting amendment is the recognition of new categories of marks. This inclusion is made in virtue of a new definition of mark which states the following: "Article 19 – Under the denomination of mark, any sign capable of distinguishing goods or services in the market. Such signs may consist of words, including personal names, letters, numbers, figurative elements such as images, graphics, symbols, combinations of colours, sounds, smells or three-dimensional shapes, as well as any combination of these signs. When the signs are not inherently distinctive, registration may be granted if they have acquired distinctiveness through use in the domestic market."

According to this definition, the new categories (highlighted in bold) are:

  • three-dimensional trade marks; and
  • scent trade marks.

Previously a three-dimensional object was protected by industrial designs. This was troublesome given that the procedure was longer and more expensive and the duration limited in time. With this new categories, applicants of three-dimensional marks can enjoy protection with lower costs and timeframes for an indefinite period of time (subject to use and renewal requirements).

It must be noted that the former definition already recognised a non-traditional trade mark such as sound mark.

Industrial designs and drawings

Another relevant amendments concerned industrial designs/drawings.

Increased term of protection

The term of protection of these rights is increased from ten to 15 years. In addition, the first transitional provision of the Law grants the right to holders of existing industrial designs and drawings which have not yet completed the original ten years of protection, to extend for another five years of protection until 15 years are completed.

Abbreviated procedure for obtaining a deposit certificate

A particularity of the Law is the replacement of a substantive analysis system with a deposit system. In the latter, a voluntary procedure for obtaining a Certificate of Deposit of Industrial Design or Drawing. Such abbreviated procedure in practice allows for a deposit system and makes it possible to expedite the obtention of an industrial design/drawing, without requesting a substantive examination and, consequently, without affecting the rights conferred to privileges which have been granted in accordance with the general procedure (subject to examination).

The advantage of such certificate is the establishing of an effective date for the purpose of verifying, in an eventual substantive examination, the fulfilment of the substantive requirements required by the IP Act. The same holder or any interested third party may request INAPI to carry out the substantive examination of a design upon infringement or alleged infringement thereof.

Finally, the sixth transitional provision of the Law offers the possibility to applicants of industrial designs whose file has not yet had an expert appointed by the date of entry into force of the Law, to request INAPI that their applications be subject to the abbreviated procedure for obtaining a certificate of deposit.

Improvements to the INAPI’s Online Platform

From an institutional standpoint, INAPI has been updating its online platform in order to provide a swift service, which has had a positive effect on users. Particularly, with regards to filing and prosecuting applications, patent databases, public domain registry and trade mark renewals.

On this last issue, INAPI issued an instruction (Memorandum 96-2021 dated 11 March 2021) establishing new terms and forms of payment which are in line with the amendments introduced by the Law on this matter.

Regarding the term to request the renewal of a trade mark registration, if prior to the Law it could be done at any time before its expiration date and up to 30 days after such date, now the renewal can be requested only as from the six months prior to the expiration and up to six months after the expiration of the registration. The above, except in the case of sound, collective and certification trade marks, in which case, the maximum term to file the renewal application is of 30 days after the expiration of the registration.

Regarding the payment of the renewal fee applicable to a mark, INAPI’s instructions (in accordance to the Law) introduce changes to the procedure, and allow that the payment to be made together with the renewal application, maintaining the grace period of six months, with a surcharge of 20% for each month or portion of a month determined according to the date of filing and payment. This implies a significant change given that previously the payment had to be made only from the date of the resolution which accepted the trade mark renewal application.

The Madrid System

In May 2021, the Chilean Senate unanimously approved the entry into force of the Madrid System (which comprises the Madrid Agreement and the Madrid Protocol) which seeks to simplify procedures to reduce the costs and formalities involved in the protection of a trade mark, and to facilitate the subsequent management thereof.

This approval creates important advantages both for nationals who will have the chance to protect their trade marks in new markets and for international holders which can introduce their business to Chile.

The specifics of how the Madrid system will work in Chile are still being refined pending the formal deposit of the ratification documents with WIPO. The deposit of the treaty is pending of execution.

However, INAPI has been providing a series of online workshops in order to introduce users to the most relevant aspects of the Madrid system. The most recent workshop dealt with the different stages of an international application. In addition, INAPI has informed that its online platform is under development so as to provide users with a timely interface to prosecute international applications.

Border Measures

With regards to Border Measures at Chilean Customs, in July 2021 the National Customs Director issued resolution 1573-2021 (the "Resolution") by which it standardized the procedure applicable to the control of products which may infringe trade marks or copyrights of rights recognized in Chile. Said resolution implies a notable improvement in connection to the rights granted for both the importer and the holder of the respective rights. These measures are currently regulated in law No. 19.912 on borders measures act (BMA).

In this regard, the BMA allows two mechanisms for the retention of imported goods:

  • ex parte requests; and
  • ex officio decisions.

As to the ex parte request, trade mark and copyright owners are allowed to request to the competent court (that where the import will actually or presumably be made) to suspend the delivery of goods that might violate their rights. The court may grant the measure without hearing the importer requiring the holder to provide a guarantee to respond for damages if the request lacks grounds. The resolution that orders the suspension is served to the competent customs authority which will then inform all the customs facilities of the country for the measure to be effective country-wide. The suspension of the delivery of goods will be valid for ten days counted as from the date of service of the resolution or the date of import of the goods (whichever is earlier). If the delivery of allegedly infringing goods is suspended, the trade mark or copyright owner must file a complaint (civil or criminal) while the suspension is valid or request an extension for additional 10 days grounded on qualified reasons. If the extension is not granted, the complaint is not filed or if upon filing of the same the upholding of the suspension measure is not requested, the measure will expire.

For its part, pursuant to Section 16 of the BMA, customs authority may order ex officio the suspension of the delivery of goods, when from a simple examination of the same it is apparent that the goods being imported infringe third party trade marks or copyrights. Customs will order the suspension of the delivery of goods and shall inform the trade mark or copyright owner who will have a maximum period of ten days to file a complaint requesting the suspension to be upheld, otherwise, the goods will be released.

Generally, even though the BMA states that the alleged infringer must be served with a formal notification of suspension of delivery of the imported goods, the notification procedure was not homogenous, leaving the formalities and deadlines to the discretion of each regional office and court. In this sense, as per the notifications to the importer/alleged infringer these were made mostly through email communications with little illustrative information by the interested right holder. In addition, the goods were commonly retained counted as from the notification to the alleged infringer and not from the date in which the corresponding customs office was notified by the relevant court (which is how the BMA mandates). This, in practice, extended the legal term in excess of the ten days of suspension. The consequence is that the petitioner had more time to perform the judicial actions against the alleged infringer.

The Resolution comes to alleviate these irregularities ordering customs offices that, when the suspension of delivery has been requested by the holder of rights and notified by the competent court, the retention term must start at the date the custom office was informed by the court and not since the notification of the right holder. Further, if the petitioner refrains from any action during the ten-days term of suspension (original or extended), customs offices shall immediately liberate the imported goods without waiting for a court order to allow for the release.

When the suspension of delivery is performed ex-officio by customs officials, they must issue a Dispatch Suspension Resolution and serve it to the rights holder in a term that shall not extend further to the following day of the audit of the imported goods. If the ten days term expire, customs must immediately dispatch the goods to the importer.

Constitutional Convention

Chile is undergoing a process to draft a new constitution. Such process in in charge of a collegiate body named "Constitutional Convention" (the "Convention"), whose members were democratically elected in early 2021. Their work started in July 2021.

In essence, the work of the Convention has focused on two subjects:

  • political system; and
  • fundamental rights.

One of the fundamental rights existing under the current Constitution is related to intellectual property (in its dual dimension, ie, copyright, and industrial property). This matter began its discussion within the Knowledge, Science, Technology, Culture, Art, and Heritage Commission (the "Commission"), which, along with other commissions, must provide proposals to the general forum to discuss and vote them.

The Commission has excluded from the proposal for discussion any referent to industrial property rights, limiting its proposals to copyrights and, in particular, specific aspects of copyrights. In our opinion, this omission has the potential to negatively impact trade mark rights inasmuch as the existing provisions under the current Constitution prevents takings without compensation inasmuch as industrial property rights are considered property rights by extension and explicit reference in the constitutional text. Accordingly, should the text remain unamended, existing rights could be suppressed or subject to imminent domain takings by law. Should the final text be approved omitting the reference to industrial property rights, the following problems have been identified.

  • In Chile, industrial property rights are granted after a transparent and coherent administrative procedure before the relevant agency (INAPI), which in turn is duly aligned with the applicable law and the current Constitution. In this sense, the absence of the reference of industrial property rights in the new constitution proposal implies a serious risk to rights holders, national and foreign who could be deprived of their rights. Additionally, more troubling would be the absence of compensation rules in favour of the said holders.
  • In direct connection with the aforementioned, the Convention is constitutionally mandated to respect all international treaties already subscribed by Chile whether on multilateral or bilateral basis. Therefore, if this obligation is breached, it would imply an explicit breach to the obligations which Chile has agreed upon related to the recognition and protection of industrial property rights and which, inasmuch as industrial property rights are considered fundamental rights, would be valid as existing constitutional provisions. This breach would potentially include minimum provisions or rights under the TRIPS Agreement and multiple bilateral agreements between Chile and other states or regional associations such as the European Union.
  • Rights granted for geographical indications and appellations of origin could also be subject to potential limitations. This would affect local and international producers as well as commitments in place and the overall good standing of the Chilean government concerning these matters.

Members of the Convention have declared that they have no intent on drafting a constitution which is in accordance with international standards but instead, it is aimed at creating a declaration of principles which will not necessarily be harmonised with our current legislation and international treaties.

The Convention must deliver the proposed text by July 2022. However, given the proximity of the due date and the very slow progress of their work, it is being discussed if such term should be extended, which is an exclusive decision of Congress given that the regulation of the Convention is contained in the current Constitution. Therefore, any amendment must be made in virtue of a constitutional provision which is subject to a high quorum of approval.

Finally, indistinctively of the date of delivery of the draft, the approval of the final document is conditioned to a final referendum where citizens must vote with a quorum for the approval of simple majority (50% + 1). It is not currently possible to assess a concrete result.

Suspension of Evidentiary Terms due to the COVID-19 Pandemic

Given the government’s declaration of constitutional exceptional status of disaster and public calamity due to COVID-19 pandemic in March 2020 (the "Declaration"), Congress approved on April 2020 law No 21.226 which established exceptional judicial measures. Among the said measures, the suspension of most evidentiary terms which were pending at the time in which the Declaration was made, until ten days after the termination of the constitutional exceptional status. The referred law implied that most government agencies issue general instructions in accordance with the applicable judicial measures.

INAPI in particular issued resolution No 398 of 6 June 2020, which made applicable the provisions of Law No 21.226 to all contentious proceedings carried out by INAPI, such as oppositions and annulment proceedings.

Given the improvement of COVID-19 conditions in Chile, mainly due to the vaccination process, Law No 21.226 was amended by Law No 21.379, which among other amendments, put an end to the suspension of evidentiary terms and in its place, with the possibility of requesting the reinstatement of the term. Also, regarding procedures which were close to initiate their probatory term, INAPI will initiate them ex-officio, serving the parties with a specific term to initiate their respective probatory activities.

SCR Abogados

Avda. Isidora Goyenechea 2934
oficina 403
Las Condes
Santiago
Chile

+56226048321

Jfreyes@scr.cl www.scr.cl
Author Business Card

Law and Practice

Authors



SCR Abogados is a boutique firm specialising in intellectual property and labour and employment law. The firm works with clients from a diverse range of sectors, including software, pharmaceutical, fishery, catering, restaurants, hotels, laboratories, NGOs and medical devices, and has a client list that includes Fortune 100 companies, domestic and foreign entities and start-ups. SCR Abogados' intellectual property department assists clients in portfolio management and maintenance, licensing, enforcement and litigation. The department has specialised in trade mark protection and enforcement from an interdisciplinary view, assisting clients in their portfolio management, contracts with third-party vendors, employees and clients.

Trends and Development

Authors



SCR Abogados is a boutique firm specialising in intellectual property and labour and employment law. The firm works with clients from a diverse range of sectors, including software, pharmaceutical, fishery, catering, restaurants, hotels, laboratories, NGOs and medical devices, and has a client list that includes Fortune 100 companies, domestic and foreign entities and start-ups. SCR Abogados' intellectual property department assists clients in portfolio management and maintenance, licensing, enforcement and litigation. The department has specialised in trade mark protection and enforcement from an interdisciplinary view, assisting clients in their portfolio management, contracts with third-party vendors, employees and clients.

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