Section J. Control of Anticompetitive Practices In Contractual Licenses
Article 15-36. Control of Anticompetitive Practices In Contractual Licenses.
1. The Parties agree that certain practices or conditions relating to the licensing of intellectual property rights referred to in this Chapter, which restrict competition, may have adverse effects on trade and may impede the transfer and dissemination of technology.
2. Nothing in this Chapter shall prevent the Parties from specifying in their legislation practices or conditions relating to licensing that may constitute, in certain cases, an abuse of intellectual property rights that has an adverse effect on competition in the relevant market. As provided in paragraph 1, a Party may adopt, in a manner consistent with the other provisions of this Chapter, appropriate measures to prevent or control such practices which may include exclusive grant-back conditions, conditions preventing challenges to validity and compulsory joint licensing, in the light of that Party's relevant laws and regulations.
Section K. Enforcement of Intellectual Property Rights.
Article 15-37. General Obligations.
1. The Parties shall ensure that their legislation establishes procedures for the enforcement of the intellectual property rights referred to in this Chapter in accordance with the provisions of this Section that permit the adoption of effective measures against any infringing action, including expeditious remedies to prevent infringements, and remedies that constitute an effective deterrent to further infringements. These procedures shall be applied in such a way as to avoid the creation of obstacles to legitimate trade and shall provide safeguards against their abuse.
2. Procedures relating to the enforcement of intellectual property rights shall be fair and equitable. They shall not be unnecessarily complicated or burdensome, nor involve unjustified time limits or unnecessary delays.
3. Decisions on the merits of a case shall preferably be formulated in writing and shall be reasoned. They shall be made available, at least to the parties to the proceedings, without undue delay. They shall be based only on evidence on which the parties have been given an opportunity to be heard.
4. The parties to the proceeding shall be given the opportunity for a review by a judicial authority of final administrative decisions and, subject to the jurisdictional provisions of each Party's law relating to the importance of a case, of at least the legal aspects of the initial judicial decisions on the merits of the case. However, it shall not be mandatory to give them the opportunity to review acquittals in criminal cases.
5. It is understood that this section does not impose any obligation to establish a judicial system for the enforcement of intellectual property rights different from that already existing for the enforcement of law in general, nor does it affect the ability of the Parties to enforce their law in general. Nothing in this Section creates any obligation with respect to the allocation of resources between intellectual property enforcement and general law enforcement.
Article 15-38. Fair and Equitable Procedures.
The Parties shall make available to right holders civil judicial procedures for the enforcement of all intellectual property rights referred to in this Chapter. Defendants shall be entitled to receive written notice in a timely manner and in sufficient detail, including the basis of the claim. Parties shall be permitted to be represented by independent counsel and the proceedings shall not impose unduly burdensome requirements as to mandatory personal appearances. All parties to these proceedings shall have adequate opportunity to present their case and to present all relevant evidence. The procedure shall provide for means to identify and protect confidential information, unless this would be contrary to existing constitutional requirements.
Article 15-39. Tests.
1. The judicial authorities shall have the authority to order that, where a party has presented reasonably available evidence sufficient to support its allegations, and has identified any evidence relevant to substantiate its allegations that is in the control of the opposing party, the opposing party shall provide such evidence, subject, in appropriate cases, to conditions that ensure the protection of confidential information.
2. In the event that a party to the proceeding voluntarily and without good cause refuses access to necessary information or otherwise does not provide such information within a reasonable period of time or substantially impedes a proceeding relating to a measure taken to secure the enforcement of a right, the Parties may empower the judicial authorities to make preliminary and final determinations, affirmative or negative, on the basis of the information submitted to them, including the claim or allegation made by the party adversely affected by the denial of access to information, provided that the parties are given an opportunity to be heard on the allegations or evidence.
Article 15-40. Injunctions.
1. Judicial authorities shall have the authority to order a party to desist from an infringement, inter alia, to prevent imported goods that infringe an intellectual property right from entering the channels of commerce within their jurisdiction immediately after customs clearance of the goods. Parties are not required to grant such a power in relation to protected subject matter that has been acquired or ordered by a person before knowing or having reasonable grounds to know that dealing in such subject matter would involve an infringement of an intellectual property right.
2. Notwithstanding the other provisions of this Section, and provided that the provisions of this Chapter specifically referring to use by the government, or by third parties authorized by the government, without the consent of the right holder are respected, the Parties may limit the remedies available against such use to the payment of adequate compensation to the right holder, according to the circumstances of each case, taking into account the economic value of the authorization. In other cases, the remedies provided for in this Section shall apply or, where such remedies are incompatible with national law, declaratory judgments and adequate compensation may be obtained.
Article 15-41. Damages.
1. The judicial authorities shall have the authority to order the infringer to pay the right holder adequate damages to compensate for the harm suffered by the right holder as a result of an infringement of his intellectual property right caused by an infringer who knowingly, or with reasonable grounds to know, engaged in infringing activity.
2. The judicial authorities shall also have the authority to order the infringer to pay the right holder's expenses, which may include attorney's fees, as appropriate. Where appropriate, the Parties may empower the judicial authorities to award damages for profits and/or compensation for damages previously recognized, even if the infringer did not know or had no reasonable grounds to know that he had engaged in infringing activity.
Article 15-42. Other Resources.
In order to provide an effective deterrent to infringement, the judicial authorities shall be empowered to order that goods found to be infringing goods be, without compensation, removed from the channels of commerce in such a way as to avoid causing damage to the right holder, or that they be destroyed, provided that this is not incompatible with constitutional provisions in force. The judicial authorities shall also be empowered to order that the materials and instruments that have been predominantly used for the production of the infringing goods be, without compensation, removed from the channels of commerce in such a way as to minimize the risk of further infringements. The need for proportionality between the seriousness of the infringement and the measures ordered, as well as the interests of third parties, shall be taken into account when processing the corresponding requests. In the case of counterfeit trademark goods, the simple removal of the trademark unlawfully affixed shall not be sufficient, except in exceptional cases, to allow the goods to be placed in the channels of commerce.
Article 15-43. Right to Information.
The Parties may provide that, unless it is disproportionate to the seriousness of the infringement, the judicial authorities may order the infringer to inform the right holder of the identity of third parties who have participated in the production and distribution of the infringing goods or services, and of their distribution channels.
Article 15-44. Indemnification of Defendant.
1. The judicial authorities shall have the authority to order a party, at whose request measures have been taken and who has abused the enforcement procedure, to adequately compensate the party on whom an obligation or restriction has been improperly imposed, for the damage suffered as a result of such abuse. The judicial authorities shall also be empowered to order the plaintiff to pay the defendant's expenses, which may include attorney's fees, as appropriate.
2. In connection with the administration of any legislation relating to the protection or enforcement of intellectual property rights, the Parties shall exempt both authorities and public officials from liability that would give rise to appropriate remedial measures only in the case of actions taken or intended in good faith for the administration of such legislation.
Article 15-45. Administrative Proceedings.
To the extent that civil remedies may be ordered from administrative proceedings conceming the merits of a case, such proceedings shall follow principles substantially equivalent to those set forth in Articles 15-38 through 15-44.
Article 15-46. Provisional Measures.
1. The judicial authorities shall be empowered to order the adoption of prompt and effective provisional measures aimed at:
a) to prevent the infringement of any intellectual property rights covered by this chapter and, in particular, to prevent goods from entering the channels of commerce within their jurisdiction, including imported goods, immediately after customs clearance; and
b) preserve relevant evidence related to the alleged infringement.
2. The judicial authorities shall be empowered to take provisional measures, where appropriate, without having heard the other party, in particular where any delay is likely to cause irreparable harm to the right holder, or where there is a demonstrable risk of destruction of evidence.
3. The judicial authorities shall have the authority to require the plaintiff to produce such evidence as is reasonably available to them to establish to their satisfaction to a sufficient degree of certainty that the plaintiff is the right holder and that his right is or will be imminently infringed, and to order the plaintiff to furnish a bond or equivalent security sufficient to protect the defendant and to prevent abuse.
4. Where provisional measures have been taken without the other party having been heard, they shall be promptly notified to the affected party no later than immediately after their application. At the request of the respondent, a review shall be held within a reasonable time after such notification, in which the right to be heard shall be recognized, with a view to deciding whether such measures should be modified, revoked or confirmed.
5. The authority responsible for the enforcement of the provisional measures may require the applicant to submit any other information necessary for the identification of the goods in question.
6. Without prejudice to paragraph 4, provisional measures taken under paragraphs 1 and 2 shall, at the request of the respondent, be revoked or otherwise rendered ineffective if proceedings leading to a decision on the merits of the case are not commenced within a reasonable period of time to be established where the law of a Party so permits, by determination of the judicial authority ordering the measures, which in the absence of such determination shall not exceed 20 working days or 31 calendar days, whichever is longer.
7. In cases where the provisional measures are revoked or lapse by action or omission of the plaintiff, or in those cases where it is subsequently determined that there was no infringement or threat of infringement of an intellectual property right, the judicial authorities shall have the authority to order the plaintiff, upon request of the defendant, to pay the defendant adequate compensation for any damage caused by such measures. 8. To the extent that provisional measures may be ordered as a result of administrative proceedings, such proceedings shall follow principles substantially equivalent to those set forth in this article.
Section L. Special Requirements Relating to Border Measures
Article 15-47. Suspension of Customs Clearance by Customs Authorities.
1. The Parties, in accordance with the provisions of this section, shall adopt procedures so that the holder of a right, who has valid reasons to suspect that the importation of counterfeit trademark goods or pirated goods infringing copyright is being prepared, may submit to the competent authorities, administrative or judicial, a written complaint in order that the customs authorities suspend the release of such goods for free circulation.
2. The Parties may authorize such a demand to be made also in respect of goods involving other infringements of intellectual property rights, provided that the requirements of Articles 15-47 to 15-56 are complied with. The Parties may also establish similar procedures for customs authorities to suspend the release of such goods destined for export from their territory.
Article 15-48. Claim.
Any right holder initiating proceedings under Article 15-47 shall be required to submit sufficient evidence to satisfy the competent authorities that, under the law of the country of importation, there is a presumption of infringement of his intellectual property right and to provide a sufficiently detailed description of the goods so that they can be readily recognized by the customs authorities. The competent authorities shall communicate to the time limit for action by the customs authorities, if they have accepted the complaint and, when they themselves establish it, within a reasonable period of time.
Article 15-49. Surety or Equivalent Guarantee.
1. The competent authorities shall have the authority to require the claimant to provide a bond or equivalent security sufficient to protect the respondent and the competent authorities and to prevent abuse. Such bond or equivalent security shall not unduly deter recourse to these procedures.
2. Where, as a result of an application under this Section, the customs authorities have suspended the release for free circulation of goods involving industrial designs, patents or undisclosed information, on the basis of a decision not taken by a judicial or other independent authority, and the time limit stipulated in Article 15-51 has expired without the authority duly empowered for that purpose having issued a provisional precautionary measure, and if all other conditions required for importation have been complied with, the owner, importer or consignee of such goods shall be entitled to obtain the release of such goods upon the posting of a bond in an amount sufficient to protect the right holder in any case of infringement. The payment of such security shall be without prejudice to any other remedy available to the right holder, and it shall also be understood that the security shall be returned if the right holder does not exercise the right of action within a reasonable period of time.
Article 15-50. Notification of Suspension.
The importer and the claimant shall be promptly notified of the suspension of customs clearance of the goods, in accordance with Article 15-47.
Article 15-51. Duration of Suspension.
If, within a period not exceeding 10 working days from the communication of the suspension to the applicant by notice, the customs authorities have not been informed that a party, other than the defendant, has initiated proceedings leading to a decision on the merits of the case or that the authority duly empowered for that purpose has taken provisional measures prolonging the suspension of the release of the goods, the goods shall be released if all other conditions required for their import or export have been fulfilled. In appropriate cases, the aforementioned period may be extended for a further 10 working days. If proceedings leading to a decision on the merits of the case have been initiated at the request of the defendant, a review, including the right of the defendant to be heard, shall be carried out within a reasonable period of time to decide whether such measures should be modified, revoked or confirmed. However, where the suspension of customs clearance is effected or continued pursuant to a provisional judicial measure, the provisions of paragraph 6 of article 15-46 shall apply.
Article 15-52. Indemnification of the Importer and the Owner of the Goods.
The relevant authorities shall have the authority to order the claimant to pay the importer, the consignee and the owner of the goods adequate compensation for any damage to them caused by the wrongful detention of the goods or by the detention of goods that have been cleared in accordance with the provisions of article 15-51.
Article 15-53. Right of Inspection and Information.
Without prejudice to the protection of confidential information, the Parties shall empower the competent authorities to give the right holder sufficient opportunity to have any goods detained by the customs authorities inspected in order to substantiate his claims. The competent authorities shall also be empowered to give the importer equivalent opportunities to have such goods inspected. The Parties may empower the competent authorities, when a positive decision has been taken on the merits of the case, to communicate to the right holder the name and address of the consignor, the importer and the consignee, as well as the quantity of the goods in question.
Article 15-54. Ex Officio Action.
When the Parties request the competent authorities to act on their own initiative and suspend the release of those goods for which they have the presumption that they infringe an intellectual property right:
a) the competent authorities may at any time request from the right holder any information that may be useful to them in exercising that power,
b) the importer and the right holder shall be notified without delay of the suspension. If the importer appeals against it to the competent authorities, the suspension shall be subject, mutatis mutandis, to the conditions provided for in article 15-51; and
c) the Parties shall exempt both authorities and public officials from liability, which would give rise to appropriate remedial action only in the case of actions taken or attempted in good faith.
Article 15-55. Resources.
Without prejudice to the other actions to which the right holder is entitled and subject to the right of the defendant to appeal to a judicial authority, the competent authorities shall be empowered to order the destruction or disposal of the infringing goods, in accordance with the principles set out in Article 15-42. With respect to counterfeit trademark goods, the authorities shall not, except in exceptional circumstances, allow the infringing goods to be re-exported in the same state or subject them to a different customs procedure.
Article 15-56. Insignificant Imports.
The Parties may exclude from the application of the foregoing provisions small quantities of goods which are not of a commercial nature and which form part of the personal baggage of travelers or are sent in small consignments.
Section M. Criminal Provisions
Article 15-57. Criminal Proceedings.
1. Parties shall establish criminal procedures and penalties at least for cases of wilful trademark counterfeiting or copyright piracy on a commercial scale. The remedies available shall include imprisonment and/or the imposition of sufficiently dissuasive monetary penalties consistent with the level of penalties applied for offenses of a corresponding gravity.
2. Where appropriate, available remedies shall also include the seizure, forfeiture and destruction of infringing goods and of all materials and accessories predominantly used for the commission of the offense. The Parties may provide for the application of criminal procedures and penalties in other cases of infringement of intellectual property rights, in particular when committed with intent and on a commercial scale.
Section N. Final Provisions
Article 15-58. Application of the Rules of this Chapter.
1. The rules contained in this Chapter do not give rise to obligations in respect of acts performed before the date of entry into force of this Agreement.
2. Except as otherwise provided, the rules contained in this Chapter give rise to obligations in respect of all subject matter existing on the date of entry into force of this Agreement and protected in that Party on that date. As regards this paragraph and paragraph 3, copyright protection obligations relating to existing works shall be determined solely in accordance with Article 18 of the Berne Convention.
3. There shall be no obligation to restore protection to subject matter that, on the date of entry into force of this Treaty, has passed into the public domain.
Chapter XVI. TRANSPARENCY
Article 16-01. Information Center.
1. Each Party shall designate a unit or office as an information center to facilitate communication between the Parties on any matter covered by this Agreement.
2. When requested by a Party, the information center of the other Party shall indicate the unit or official responsible for the matter and provide such support as may be required to facilitate communication with the requesting Party.
Article 16-02. Publication.
1. Each Party shall ensure that its laws, regulations, procedures and administrative rulings of general application that relate to any matter covered by this Agreement are promptly published in the state Party issuing or processing them or made available for the information of the Parties and any interested party.
2. To the extent possible, each Party shall publish in advance any measure it proposes to adopt that concerns any matter related to this Agreement, and shall provide the other Party with a reasonable opportunity to request information and comment on the proposed measures.
Article 16-03. Notification and Provision of Information.
1. Each Party shall, to the extent possible, notify the other Party of any measure in force that the Party considers may substantially affect or will substantially affect the interests of that other Party under the terms of this Agreement.
2. Each Party shall, upon request of the other Party, provide information and promptly respond to its requests for information on any measure in force relating to this treaty, notwithstanding that that Party has been previously notified of that measure.
3. The notification or provision of information referred to in this Article shall be made without prejudice to whether or not the measure is compatible with this Treaty.
Chapter XVII. TREATY ADMINISTRATION
Article 17-01. Administrative Commission.
1. The Parties establish the Administrative Commission, composed of the officials referred to in Annex 17- 01(1) or by the persons designated by them.
2. The Commission shall have the following functions:
a) to ensure compliance with and the correct application of the provisions of this Treaty;
b) evaluate the results achieved in the implementation of this Treaty and monitor its development;
c) resolve any differences that may arise with respect to its interpretation or application;
d) oversee the work of all committees established under this Treaty and included in Annex 17-01(2); and
e) to hear any other matter that may affect the operation of this Agreement, or any other matter that may be entrusted to it by the Parties.
3. The Commission may:
a) establish and delegate responsibilities to ad hoc or standing committees;
b) seek advice from individuals or groups with no governmental connection, and
c) if agreed by the Parties, take any other action in the exercise of its functions.
4. The Commission shall make all its decisions unanimously.
5. The Commission shall meet at least once a year. The meetings shall be chaired successively by each Party.
Article 17-02. Secretariat.
1. Each Party shall designate an official office or unit to serve as that Party's Secretariat and shall communicate to the other Party: the name and position of the official responsible for its Secretariat; and the address of its Secretariat to which communications should be addressed.
2. The Commission shall supervise the coordinated functioning of the secretariats of the Parties.
3. It shall be the responsibility of the Secretariats:
a) provide assistance to the Commission;
b) provide administrative support to the arbitration tribunals;
c) by direction of the Commission to support the work of the committees established under this Treaty;
d) the payment of remuneration and expenses due to arbitrators and experts appointed in accordance with this Treaty, as provided in the Annex to this Article; and
e) perform such other duties as may be assigned to it by the Commission.
Annex 17-01.1. Officers of the Administrative Commission
The officers referred to in Article 17-01 are:
a) in the case of Mexico, the Secretary of Economy, or his successor; and
b) in the case of Uruguay, the Minister of Foreign Affairs, or his successor.
Annex 17-01.2. Committees
1. Committee on Trade in Goods (Article 3-15)
2. Committee on Rules of Origin and Customs Procedures (Article 4-18)
3. Committee on Sanitary and Phytosanitary Measures (Article 8-10)
4. Committee on Temporary Entry of Business Persons (Article 12-06)
5. Trade and Competition Committee (Article 14-05)
Annex 17-02. Remuneration and Expenses Payment
1. The Commission shall fix the amounts of remuneration and expenses to be paid to arbitrators and experts.
2. The remuneration of the arbitrators, experts and their assistants, their transportation and accommodation expenses, and all general expenses of the arbitral tribunals shall be covered in equal portions by the Parties.
3. Each arbitrator and expert shall keep a record and submit a final account of his time and expenses, and the arbitral tribunal shall keep a similar record and submit a final account to the Secretariat of all general expenses.
Chapter XVIII. SETTLEMENT OF DISPUTES
Article 18-01. Scope of Application.
Except as otherwise provided in this Agreement, disputes arising between the Parties regarding the interpretation, application or breach of the provisions contained herein, and disputes that may arise between the Parties regarding the application of measures in force that are deemed inconsistent with the obligations of the Agreement or that may cause nullification or impairment of benefits within the meaning of Annex 18-01, shall be subject to the dispute settlement procedure set forth in this Chapter.
Article 18-02. Dispute Settlement Under the WTO Agreement.
1. Any dispute arising in connection with the provisions of this Agreement and the WTO Agreement may be resolved in either forum at the option of the complaining Party.
2. Before the complaining Party initiates dispute settlement proceedings under the WTO Agreement against another Party alleging matters substantially equivalent to those that it may invoke under this Chapter, the complaining Party shall give written notice of its intention to do so to the other Party.
3. Once a Party has initiated dispute settlement proceedings under the WTO Agreement, or under the procedure provided for in this Chapter, it may not resort to the other forum with respect to the same matter.
4. For purposes of this Article, dispute settlement procedures under the WTO Agreement shall be deemed to have been initiated when a Party requests the establishment of a panel pursuant to Article 6 of the Understanding on Rules and Procedures Governing the Settlement of Disputes, which is part of the WTO Agreement. Likewise, dispute settlement procedures with respect to this Chapter shall be deemed to have been initiated when a Party requests the establishment of an Arbitral Tribunal pursuant to Article 18 -04.
Article 18-03. Consultations.
1. The Parties shall endeavor to resolve disputes referred to in Article 18-01 through consultations with a view to reaching a mutually satisfactory solution.
2. Either Party may request consultations with the other Party, which shall be communicated to the Commission. Any request for consultations shall be submitted in writing to the other Party and shall state the reasons on which it is based, with an indication of the subject matter of the dispute and the legal basis of the complaint.
3. The Parties shall provide the information that allows analyzing the matter, treating such written or oral information confidentially and shall consult among themselves in order to reach a solution. The consultations shall not prejudice the rights of any of the Parties that are dealt with in other competent forums.
4. This stage may not be extended for more than 30 days from the date of receipt by the other Party of the formal request to enter into consultations, unless the Parties, by mutual agreement, extend this period.
Article 18-04. Request for the Establishment of an Arbitral Tribunal.
When the dispute could not be settled through consultations, the Party initiating the proceedings may request in writing to the other Party the establishment of an Arbitral Tribunal.
Article 18-05. Integration of the Arbitral Tribunal. Arbitrators.
1. Unless otherwise agreed by the Parties, the Arbitral Tribunal shall be composed of three (3) arbitrators.
2. In the written notification provided for in Article 18-04, the Party requesting the Arbitral Tribunal shall appoint an arbitrator to the Arbitral Tribunal who may be a national of that Party.
3. Within 15 days of receipt of the request for the establishment of an Arbitral Tribunal, the other Party shall appoint a member of the Arbitral Tribunal, who may be a national of that Party.
4. Within 30 days after receipt of the request for the establishment of an Arbitral Tribunal, the Parties shall agree on the appointment of the third arbitrator of the Arbitral Tribunal. Unless otherwise agreed by the Parties, the third member shall not be a national or resident of either Party. The arbitrator so appointed shall be the presiding arbitrator of the Arbitral Tribunal.
5. If any of the three arbitrators has not been nominated or appointed within thirty days of receipt of the notification referred to in paragraph 2 of this Article, the Director-General of the WTO shall, at the request of any Party, make the required appointments within a further thirty days.
6. The remuneration of the arbitrators and the other expenses of the Arbitral Tribunal shall be borne in equal amounts by the Parties.
Article 18-06. Qualifications of the Arbitrators.
1. The arbitrators sitting on the Arbitral Tribunal shall act in their personal capacity and not as representatives of the Parties, of a government or of an international organization. Consequently, the Parties shall refrain from giving them instructions or exercising any kind of influence over them with respect to the matters submitted to the Arbitral Tribunal.
2. The arbitrators that make up the Arbitral Tribunal shall comply with and abide by the provisions contained in the Code of Conduct. No later than 30 days after the entry into force of this Agreement, the Commission shall establish the Code of Conduct.