LatAm has weak intellectual property enforcement

Latin American countries have adequate laws to protect Internet and software intellectual property, but the enforcement of those laws is weak and inconsistent, legal experts said March 22 at a University of Miami symposium.

Many violations aren’t prosecuted, and the perpetrators who are taken to court often walk away with little or no punishment. The timid enforcement leads to rampant intellectual property violations, such as software piracy and cybersquatting, which in turn discourage companies from investing in Latin American countries, said speakers at the “Internet in Latin America: Barriers to Intellectual Property Protection” event.

The effects are particularly serious for the region’s IT industry, since intellectual property makes up such a large percentage of the assets of companies that sell software and provide services and content via the Internet.

Discouraged by feeble intellectual-property protections, many foreign Internet and software companies bypass Latin America altogether or, if they do decide to do business in the region, establish a smaller presence than they could, speakers said. Meanwhile, intellectual property violations also hurt local Internet and software companies, hampering their growth and their ability to develop products and services.

The end result is that software and Internet users in Latin America end up with fewer products and services and support than they would enjoy if governments enforced intellectual property laws more aggressively in areas such as copyright, trademark, international trade agreements and patents, speakers said.

“Mexico has significantly strengthened its intellectual property laws in the past 10 years, but problems persist including … ineffective enforcement,” said Robert Kossick, a legal consultant with Mexico City-based Ancona & Asociados.

The situation in Brazil and Argentina is similar: Intellectual property laws have been improved in recent years, but prosecution and enforcement are minimal, speakers said.

“Intellectual property is protected in Argentina’s constitution … but enforcement is deficient,” said Marcos Basso, an attorney with Miami-based Wermuth Law PA who has a law degree from Argentina and practiced law there.

“Enforcement (of intellectual property laws) is a big problem in Brazil,” said Adriana Krause Vianna, a Brazilian attorney who is an associate with Miami-based law firm Steel Hector & Davis LLP.

Given this cloudy scenario, Internet and software companies are advised to acquaint themselves thoroughly with the intellectual-property laws of the countries they plan to operate in, and take as many preventative steps as possible before launching their businesses. These steps might include securing local copyrights, registering trademarks, claiming patents and snapping up domain names, speakers said.

Although governments have adapted existing laws and created new ones to protect software and Internet intellectual property, this task is far from over. The code of law of many Latin American countries must continue to be refined, because many gray areas remain. Consequently, judges are left to grapple with issues that their countries’ laws may not directly address, such as misappropriation of Internet domain names, taxation of online sales, Internet customer privacy and jurisdiction in online transactions, speakers said.

“Countries in Latin America have highly formalistic legal codes. Judges aren’t inclined to invent solutions to new problems,” said Keith Rosenn, a professor at the University of Miami’s School of Law.

For example, in Argentina, the push to adapt traditional laws to Internet activities, such as online sales and digital contracts, has lost considerable steam since the dot-com bubble burst and deflated lobbying efforts in this area, said Guillermo Cabanellas, an attorney with the Buenos Aires-based Cabanellas, Etchebarne & Kelly law firm.

“Internet law reform has stalled in Argentina,” Cabanellas said. “The rate of change has definitely slowed.”

The event was organized by the University of Miami School of Law and by the university’s Inter-American Law Review scholarly journal.

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