Protecting your Intellectual Property in Latin America

Companies entering Latin America often bring valuable intellectual property (IP) with them. This intellectual property is often the reason they are successful in their home country and it also the reason they look are able to grow into new markets.

We asked Andrea Dawson, Partner, to provide some tips on how companies can best protect their intellectual property. Andrea presided over the International trademark division of one of the top IP firms in Latin America for over 9 years. Andrea has an extensive amount of experience working with global brands helping them to protect their intellectual property both in Latin America and Internationally.

Given the importance of IP, companies need to have a thorough understanding of how to protect themselves and enforce their rights against those that may infringe it. When a company enters the Latin American region, there are two key central issues that should be considered –

• IP rights be registered before the relevant governing body, and
• Contracts should be well drafted with IP covered in detail.

IP rights be registered before the relevant governing body

The first important step to protecting your IP is ensuring it is registered in the countries you are operating in. This is particularly true with industrial property since it can only be protected through registration. Without proper registration, it will be very difficult to defend against the unauthorized use by third parties. In the case where companies will license their technology, the registration is an important step given that clients will not want to acquire rights of which there is no existence or ownership.

Contracts should be well drafted with IP covered in detail.

The second important step to protecting your IP is ensuring that your intellectual property is thoroughly covered in any commercial agreements or contracts the company may enter into. Contracts and intellectual property are inseparable issues which is why every agreement needs to be reviewed to ensure the companies IP rights are being protected. A badly drafted contract can lead to litigation, unnecessary expense, and a loss of valuable time.

Where does IP typically appear and when should it be protected?

The following agreements tend to cover intellectual property and it is our recommendation that each should be reviewed and updated when working in a new region – 

• Non-Disclosure Agreements and Confidentiality Agreements
• Memorandum of Understandings
• Agency Contracts
• Work Contracts
• Sale / Assignment of your IP
• Trademark/Patent and Technology Transfer License
• Joint Venture Agreements
• Manufacturing Agreements
• Distribution Agreements
• IT Agreements
• Franchise Agreements

Agreements should be drafted whenever your IP is being used or when new IP could be created. The fact is that the majority of companies rely on more than just employees to create their IP.  Companies often have contractors, consultants or partners who help develop their intellectual property. It could be in full or even just partially. This is why it is important to enter into a contract with each person or entity before starting to work on a project since even in the early stages of working together, important IP can be created.  It is important to determine from the beginning who is the owner of the intellectual property and how it will be treated later on.

Contracts do not need to be long or excessively formal. However, they should be clear and contain the proper language to protect your intellectual property rights. Proper legal advice should be sought, particularly in foreign countries since often English contracts will need to be adapted.

Conclusion

Contracts are an important part of protecting a company’s intellectual property and it works together with registration. A company’s intellectual property is what often gives a company value and/or a future. It can be sold, or licensed, offered as equity in a joint venture, offered as a basis to enter into strategic alliances, integrated into a current business or used to create a new business.

Ax Legal Advice – Companies do not always have patents, but they still have intellectual property that can be protected through different means such as contracts. A common issue is that companies enter the Latin American Region without properly understanding how they need to protect their IP through their employment contacts, partner agreements, etc. It is important to have IP clauses reviewed and then translated to Spanish.

Ax Legal provides clients with a free intellectual property review to identify any problem areas. We can then update all of your agreements where needed to ensure that your local team has everything they need to develop the business while ensuring it is protected.

Ax Legal is a legal and business advisory firm that works with foreign companies in Latin America. Our team of legal and commercial advisors have a distinguished track record of helping foreign technology and services companies with their operations in Latin America.

To better understand how we can support you in the Region, please contact Cody Mcfarlane at cmm@ax.legal