Japan is a key strategic partner for Brazil in Asia. The official ties between the two countries can be traced back to the signing of the Treaty of Friendship, Commerce and Navigation in 1895.
Today, enormous opportunities exist for co-operation between the two nations, especially in relation to science, technology and innovation (e.g. in the areas of communications, artificial intelligence, robotics, medical science and health, and 5G internet, to give just a few examples).
In this article the author outlines some of the recent developments in Brazilian IP law that may be of interest to those looking at Brazil for future investment opportunities.
Brazil has been investing in initiatives to become more modern and competitive. These steps include ratifying important international treaties, defining new strategies, creating regulations and legislation, conducting public consultation processes, and implementing critical changes to its institutions, the courts and law enforcement.
In 2021, Brazil was among 19 countries termed as “over-performers” in the 14th Global Innovation Index (GII) report, meaning it is performing above expectations in terms of developments in innovation and technology. Now in 57th place, Brazil has made considerable progress, moving up five places (the biggest advance since 2012).
The Brazilian government’s initiatives include a new national intellectual property strategy or estratégia nacional de propriedade intelectual (ENPI), with the goal of creating a balanced and effective national IP system to promote creativity, investments in innovation and access to knowledge.
As of today, more than 70% of the initiatives foreseen in the strategy’s action plan are already underway.
Despite there still being considerable patent delays in Brazil, the data from last year suggests that the actions by the Brazilian Patent and Trademark Office (PTO) can be seen as steps in the right direction.
According to the latest World Intellectual Property Organisation’s (WIPO) report titled World Intellectual Property Indicators 2021, Brazil granted 86.4% more patents in 2020 than the previous year, higher than in other emerging economies such as China (17.1%) and India (11.8%). In 2021, the average time to approve patents fell from 9.5 years on average to 6.8 years. These results have been largely down to the Brazilian PTO’s ambitious plan to reduce the patent backlog, which seeks an 80% reduction over a period of two years.
There were also significant developments in the Brazilian courts, legislature and institutions over the past few years regarding patents. The following are just some examples:
- – In 2020, the Brazilian PTO released new guidelines for examining patent applications in the biotechnology field. The final text is the result of a review by the Brazilian PTO on patentability issues concerning biotech inventions and a compilation of proposals presented during the public consultation previously.
- – In 2021, the Nagoya Protocol on Access and Benefit Sharing took effect in Brazil, which is a multilateral agreement supplementary to the Convention on Biological Diversity that establishes rules of access to genetic resources and traditional knowledge associated with them, as well as the sharing of benefits resulting from that use.
- – In 2021, a landmark ruling, Constitutional Challenge ADI 5529, by the Brazilian Supreme Court struck down an article in the Brazilian IP Law (article 40, sole paragraph) that had allowed for the validity of patents for 10 years from the date of approval. This caused significant debate and disagreement among the country’s IP professionals.
- – In 2021, the Brazilian legislature revoked a controversial article in the Brazilian IP Law, thereby ending the participation of the Brazilian FDA, Agência Nacional de Vigilância Sanitária (ANVISA) in the examination of Brazilian patent applications. While the article has now been repealed, the issue is still the subject of diverse legislative proposals and lawsuits.
- – In 2021, the Brazilian PTO released helpful guidelines explaining in what circumstances software-related inventions might be patented (i.e., where defined as a technical solution that solves a technical problem and which generates technical effects).Despite some drastic changes in Brazilian patent law over the past few years, applicants have multiple mechanisms readily available to speed up the patent process (mostly through the Brazilian PTO’s fast-track programmes).
For example, the Brazilian PTO has signed multiple patent prosecution highway (PPH) agreements with counterpart authorities, and the latest rules allow companies to file patents in one jurisdiction (office of first filing) and carry out further examination in another country (office of earlier examination).
The PPH agreement between Brazil and Japan was renewed late last year and will last for five years.
Therefore, for example, if an application is first filed in Japan and a counterpart is filed and allowed in Europe, the applicant could use the European claims to file a PPH request and speed up the patent process in Brazil.
OTHER IP AREAS
Some recent initiatives in other areas of IP protection by the Brazilian government are showing results. Some examples include:
- – In 2019, the new Brazilian Franchise Law was enacted. Although no groundbreaking change was made in the Brazilian franchising system, the law updates several terminologies and concepts, inserts some mandatory information in the franchise disclosure document and brings new rules to the franchising system in Brazil.
- – In 2019, the Madrid Protocol was implemented into Brazilian law. The protocol allows filing a single trademark application to apply for protection in more than 100 countries. This step was strategic for Brazil’s plans to foster international relations. By adopting the protocol, the registration process for trademarks abroad has become more agile and simplified. In the past, companies wishing to register their trademark abroad had to make an individual application in each country of their choice, also bearing the respective costs in each national IP office. So far, the protocol appears to be working well from a Brazilian perspective.
- – In 2019, the Brazilian PTO published guidelines simplifying the process around industrial designs and clarifying some prominent issues. For example, it clarified that auxiliary figures will be accepted, including cross-section and amplified views to facilitate the examiner’s understanding when the regular views are not enough to reveal specific ornamental features of the claimed object. This is important, as the recent changes and improvements to the examination standards related to design applications in the PTO could increase its use in IP protection strategies in the future.
- – In 2021, the Brazilian PTO published a new rule, providing for the registration of trademarks in the form of a position mark. This brings the country in line with other jurisdictions that already accept this type of registration (e.g. the European Patent Office, Germany, Argentina and Canada). The move is also important in terms of the overall discussion on the protection of non-traditional trademarks (i.e. marks related to colour, sound, motion, position, or a 3D view, etc.).
– In 2021, the Ministry of Justice and Public Security and the National Secretariat for Consumer Affairs approved the new national plan to combat piracy, smuggling, tax evasion and IP offences. The plan will last for four years (2022-2025) and encompasses 62 targets with short, medium and long-term actions envisioned. While it will focus heavily on combating digital piracy, it also includes activities related to piracy at physical locations.
IP AND THE COURTS
The Brazilian courts provide effective solutions for national and international claimants alike. The country has an independent judiciary and injunctions are widely available when required (in fact, the standards to obtain such relief are quite low compared to other countries like the US).
Each Brazilian state has its own judicial system and therefore, infringement lawsuits can be filed before any state court. As a general rule, infringement lawsuits must be filed in the state where the accused infringer has its principal place of business. However, they may also be filed in any place where acts of infringement occurred.
Specialist judges are not available. However, a number of specialised IP courts have been created in recent years. Rio de Janeiro has four federal district courts with special jurisdiction to hear cases filed against the Brazilian PTO. In turn, the Federal Court of Appeals for the Second Circuit, which has jurisdiction to decide appeals from Rio de Janeiro, has two chambers specialising in IP cases.
At the state level, all major Brazilian cities have courts specialising in commercial and corporate law, which encompasses IP. For instance, Rio de Janeiro has seven state courts with jurisdiction to hear commercial law cases, including IP cases, and São Paulo also recently created four such courts.
Article published in the Asia Business Law Journal.