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Venezuela

Published on Wednesday 12th June 2019

    • Venezuela

      To be patentable, the subject matter must be novel. However, there are some exceptions to this requirement such as: invention, improvement or industrial model or design that, being patented abroad, have not been divulged, patented nor put into execution in Venezuela, which means they are not in the public domain and can be patented in Venezuela. Inventive step is required for inventions.

    • Venezuela

      Venezuela’s Industrial Property Act (1955) recognises the following types of patents: patents of invention (letters patents), revalidation patents, introduction patents, patents of improvements, industrial model patents and industrial drawing patents.

      Revalidation patents are the ones based on any prior foreign patent (not necessarily the patent granted in the applicant’s home country, or the first patent granted) and applied for by the owner of such foreign patent or his or her rightful successor. Revalidation patents are granted to holders of foreign patents, provided that they make a request to file their patent in Venezuela within 12 months of the foreign patent’s filing date.

      The Act of 1955 also recognises the grant of introduction patents (patents of importation), not to be confused with revalidation patents, valid for a period of five years starting from its issue, which cannot be applied for by the inventor, his or her successor or assignee, but by the person who introduced the invention to Venezuela, while the patent application was in no way based on the patent of the country of origin. These introduction patents will not confer the right to prevent others from importing similar goods from abroad, but will confer upon its owner an exclusive right of manufacture in Venezuela.

      Patent of Improvements: According to the Venezuelan Patent Act, every person has the right to improve the invention of someone else, but will not be allowed to use said invention without the consent of the inventor. Neither will the inventor be allowed to use the improvement without the consent of the author thereof.

      Industrial model patents and industrial drawing patents: By industrial model we mean plastic forms combined with colours or not, and any industrial, commercial or domestic utensils or suitable pattern for the production or manufacture of other ones and which differ from their similar through their distinctive shape or configuration. Industrial drawing means disposition or union of lines, colours and of lines and colours aimed at giving any industrial object a particular appearance.  

    • Venezuela

      In Venezuela, patent litigation will generally be sought before a trial court that may issue, within the procedure, a wide range of injunctions to safeguard a legal right.

      To be able to file a suit, a patent must have been duly granted by the Venezuelan Patent Office (PTO). Therefore, suits are filed before trial courts that have jurisdiction in cases dealing with civil, commercial, traffic, trade and transit matters.

      In Venezuela the PTO cannot render decisions on patent litigation cases, but only in matters dealing with the granting, denial or nullity of a patent right.

      There are a few cases of pending patent litigation, particularly related to the pharmaceutical industry.

    • Venezuela

      Among others, the following elements are considered when calculating damages:

      • the consequential damage and lost profits suffered by the right holder as a result of the infringement;
      • the amount of profit obtained by the infringer as a result of the acts of infringement; or
      • based on the commercial value of the infringed right and such contractual licences that may have already been granted, the price the infringer would have paid for a contractual licence.

      A wide array of injunctions are available for a patent owner to guarantee its rights during the course of a judicial proceeding. The judge, at his or her own discretion and provided that the plaintiff can support its right and show irreparable harm, can order injunctions ranging from seizure of goods to the prohibition of the sale of these goods. In some cases, the plaintiff will be required to post a bond to guarantee possible damages that may arise from the injunctions being sought.

      Other measures (injunctions) that may be ordered include the following:

      • immediate cessation of all acts constituting the alleged infringement;
      • withdrawal from commercial channels of all products resulting from the alleged infringement, including packaging, wrappings, labels, printed or advertising material, other materials and implements which have been used mainly for the commission of the infringement;
      • suspension of the import or export of the goods, materials or implements referred to in the paragraph above;
      • establishment of an appropriate guarantee by the alleged infringer; and
      • temporary closure of the business belonging to the defendant or accused, if necessary, to avoid prolongation or repetition of the alleged infringement.
    • Venezuela

      No, Venezuela withdrew from the Andean Community in April 2006. However, Andean decisions were still in force until September 2008 when the PTO officially ordered the reinstatement of the Venezuelan Industrial Property Law issued in 1955.

      Regarding Mercosur, Venezuela is currently a member and has been since August 2012.

    • Venezuela

      Our Industrial Property Law establishes that, in order to use the registered trademark symbol, the sign must be registered. If it is used for a sign that is not registered, fines may be imposed by the competent authorities (US$100).

      As for the ™ sign, although unregistered trademarks are not established in our law, it is not prohibited and so its use is permitted.

    • Venezuela

      Although not compulsory, trademark licences should be recorded at the PTO, so the use of the trademark by the licensee can be considered as valid in case a cancellation action for lack of use rises against the registration.

      In addition, in order to record a licence at the Venezuelan PTO, the trademark involved needs to be registered.

    • Venezuela

      Different strategies have been successful in combating counterfeiting; among them we can mention certain out-of-court actions. The first of these are cease and desist letters, which provide an amicable method of trying to stop the infringement. In this letter, the infringer is informed of the actions brought against it for infringing intellectual property rights, and it is notified that the company must stop infringing these intellectual property rights within a certain period of time.

      The second action is a judicial notification. This would be carried out by a court. The court would visit the premises of the infringers and would formally notify them that:

      • the owner is aware of their continued illegal use of the IP rights; and
      • legal actions are available to prevent the unauthorised use of the IP rights, which will be taken if the infringer continues using the IP rights within a given time frame.

      The main goal of this action is to try to solve the issue without taking a contentious action.

      There are also judicial solutions available, namely:

      • formal claim for illegal use of IP rights: a lawsuit can be filed for illegal use of the IP rights, so as to ask the court for the cessation of all illegal actions representing infringement of intellectual property rights as well as indemnification for damages. Furthermore, provisional precautionary measures can be requested along with this procedure, in order to stop and prevent damages, and during the time the process lasts, it would prevent the other party from performing the actions that are being reported.
      • Unfair competition: in this case, a legal action based on unfair competition could be filed, in an autonomous procedure or jointly with the formal claim for illegal use of IP rights. Unfair competition acts in intellectual property matters are those performed in the business field that are contrary to honest practices, that is, those that conflict with cultural norms accepted in a certain time and place, and that, therefore, are prohibited by commercial practice.
      • Pretrial Procedure: International treaties executed by Venezuela and the Venezuelan Copyright Law provide that the holder of a violated right can request the relevant court to order precautionary measures, prior to, during or after the filing of a lawsuit for illegal use of trademark, in order to prevent the carrying out, continuance and/or consequences of the infringement. This action is initiated with the request for production of evidence presented before a Municipal Court in order to evidence the existence of the infringement. Once the infringement has been verified, the court is asked to order the immediate cease of the actions constituting infringement.
    • Venezuela

      Yes, definitely registering a second level domain name in Venezuela is highly recommended in order to avoid third parties registering such domains. In our jurisdictions the following domain names are available: .com.ve; .co.ve; .net.ve; .info.ve; and .web.ve.

    • Venezuela

      Since Venezuela’s withdrawal from the Andean Community and the consequent reinstatement of the Industrial Property Law, the classification system is not generally well understood by foreigners.

      In this regard, the classification system is based on the Local Classification. The International Classification of Goods and Services is used as a reference and is acceptable as far as it coincides with the Local Classification. This is similar to the system used in the US Trademark Office, but instead of applying for one application with the international class and just naming the local class (or as many local classes falling into one international class), the application must be filed indicating the Venezuelan local class and indicating the international class as reference. Therefore, if a proposed application falls in more than one local class, it would be necessary to file as many applications as local classes involved.

      In addition, the Venezuelan PTO requests that all new applications must be accompanied by an Official Search; therefore, the filing procedure is not as fast as trademark owners would like it to be.

      Finally, the fact that applications must be published in a local newspaper prior to its publication in the Official Gazette is not well understood. This requisite is established by the Industrial Property Law; therefore, although it is considered obsolete, compliance is mandatory in order to avoid the application being published as abandoned due to the failure to fulfil such requirement.

    • Venezuela

      When registering a trademark in Venezuela it is important to consider potential obstacles. It is therefore recommended that one analyses the official searches prior to filing in order to determine the source of possible conflicts.

      If the registrant or any authorised third party is the entity that will use the trademark, when the application matures into registration, the licence shall be recorded in order to defend its use.

    • Venezuela

      Yes, our Industrial Property Law establishes that once an application is published in the Official Gazette, any third party may file an opposition if they consider that the application is confusingly similar to a previously registered or applied for registration. The oppositions must be filed within 30 days from the publication and such deadline cannot be extended.

    • Venezuela

      Yes, Venezuela has customs authorities that are in charge of restricting and seizing counterfeiting goods.

      The National Integrated Service of Customs and Tax Administration (SENIAT) have a division responsible for the enforcement of intellectual property rights during the importation and transit of goods through Venezuelan customs.

      Applicable law (Administrative Decision of the SENIAT SNAT/2005/0915) stipulates that the SENIAT is empowered to conduct raids on a nationwide basis to preventively seize imported products that may infringe intellectual property rights.

      According to this administrative decision, if any illegal use of your trademark is committed through imported products, this action may also be considered.

      The SENIAT can intervene when imported goods that may be violating or infringing intellectual property rights are found: (i) in the immediate control area, (ii) in free-trade zones and bonded warehouses, and (iii) in areas where control has already been carried out.

      The procedure begins with the request for an immediate inspection and preventive retention of the infringing goods presented before the SENIAT by the owner of the IP rights with valid reasons to suspect that goods infringing intellectual property law may be imported or may transit through the national territory.

      Once such request has been received, SENIAT officers will go to the location of the infringing goods and request the infringer to present the authorisation issued by the holder of the right, whether it is an assignment of rights, a subsidiary licence, a distribution agreement or a sales agreement.

      In the case that the infringer does not present the requested documentation, the SENIAT may preventively retain the infringing goods. The SENIAT should notify the infringer and the owner of the IP rights about the retention or seizure of the goods immediately. After this notification, the parties have a period of 10 business days to proceed with any legal actions that they consider appropriate.

      Finally, SENIAT is recently under restructuration and has been difficult to rely on their collaboration.

    • Venezuela

      The key issues to consider would be the full details in the agreement of the trademark(s) to be licensed. These details include: application/registration number(s), international class(es), and the corresponding list of good(s). It is also important to mention that the licensor must use the trademark in the same way it is used by the owner, in accordance to the granted rights. Furthermore, although quality control is not expressly established by law, it will also be a key issue to consider in the agreement. Our jurisdiction does not invalidate trademarks based on “naked licences” (ie, where the licensor does not impose quality standards on the goods and services associated with the licensed trademark).

    • Venezuela

      There is no special law regulating franchises in Venezuela. Therefore, franchise agreements are considered private contracts that usually include trademark licences. Moreover, such agreements are interpreted under the scope of Licence Agreements. 

    • Venezuela

      The limitations and conditions would be established by an agreement made between the parties. They may include the limitations on the ability of a trademark licensor to enforce or terminate a trademark licence agreement that is deemed convenient for the parties.

    • Venezuela

      A trademark application can be legally deemed abandoned without an express request, when the applicant does not comply with the legal proceeding established in the law (for example, lack of response to an office action; lack of publication in a local newspaper; lack of payment of the final granting tax.) Regarding registered trademarks, they can expressly be deemed as abandoned, as provided by law, when withdrawing the registration or not timely renewing the mark.

    • Venezuela

      In the case of packaging we do recommend protection through trademark registrations. As for the marketing material it may be protected by copyrights.

      In Venezuela copyrights are protected by the mere creation of the work and its registration is only declarative. However, if the copyright will be subject to licence or assignment of the economic rights, then it would be necessary to register the copyright at the Venezuelan Copyright Office.

    • Venezuela

      Although our law does not establish specifically the liability of internet service providers, in practice, cease and desist letters are considered by the ISP and they may eliminate the conflicting contents, considering that the penalties and fines are directed to the infringers. However, ISPs may be considered as cooperators if once having been notified of the infringements, no actions are taken in order to prevent the continuance of such activities.

    • Venezuela

      In the Venezuelan Industrial Property Law, there are no specific regulations regarding this matter; however, the standards for contributory infringement are the standards from our Criminal Code for accessories, aiders and abettors.

    • Venezuela

      A term of imprisonment of between six and 18 months may apply if any person who, intentionally and without a right to do so:

      • makes use of the title of a work in violation of the law;
      • communicates intellectual works, in the original or a developed form, in their entirety or in part, editions of the works of others or of texts, photographs or products obtained by a process corresponding to photography, or images recorded on cinematographic film; or
      • distributes copies of intellectual works protected by the law, including copies of recorded material, or retransmits a broadcast without the consent of the owner of the rights.

      And in other cases, the imprisonment term can last from one to four years if any person:

      • intentionally and without a right to do so reproduces intellectual works in the original or a developed form, in their entirety or in part, editions of the works of others, texts or photographs or products obtained by a process corresponding to photography, or images recorded on cinematographic film; or
      • introduces into the country, stocks, distributes, sells or otherwise brings into circulation unlawful reproductions of the intellectual works or products protected by the law.
    • Venezuela

      It is directly recognised by the Constitution and there are other laws that indirectly recognise the right of publicity. For the most part, it is recognised in the personal and moral rights. However, there is no special law that regulates these matters in the commercial spectrum (like in other countries); even though it is broadly recognised through the trademark protection.

    • Venezuela

      Yes, ADR is used in Venezuela. However, it must have been previously specified by the parties in a contract. The benefit is that the procedure is not as costly as a court action and it is expedited. The danger is that the decision issued by the arbitrators is final, thus an appeal cannot be filed at court.

    • Venezuela

      The SENIAT has a division responsible for the enforcement of intellectual property rights during the importation and transit of goods through Venezuelan customs.

      Applicable law (Administrative Decision of the SENIAT SNAT/2005/0915) stipulates that the SENIAT is empowered to conduct raids on a nationwide basis to preventively seize imported products that may infringe intellectual property rights.

      Although neither SENIAT, nor any other government agency has yet created a registry for this purpose, it is acceptable to inform them about the existence of a particular IP right and they are normally brought to the Venezuelan territory. Therefore if the custom authorities detect any discrepancy, they shall notify the owner or its representative.

    • Venezuela

      In 2016, the Supreme Court of Justice decided four cases in connection with the following trademarks: (i) SILIKON application No. 19086-97 dated 23 September 1997 in international class 5; (ii) CY° ZONE application No. 8765-2202 dated 12 June 2002 in international class 3; (iii) FENOVIST application No. 16984-1197 dated 25 August 1997; and (iv) E ESSENCE logo application No. 581-2011 dated 14 January 2011 in international class 3.

      The cases were pending since their filing date and were ex officio denied by the Patent and Trademark office owing to similarities in trademarks: SILICONBOND, EYZONE, CENOVIS and l’ESSENCE logo.

      Reconsiderations petitions were submitted and dismissed by the PTO. Further Appeals were filed before the Ministry of Production and Commerce and no decisions were taken by the Ministry. In view of the above and considering the long time the applications were pending, appeals for review were requested before the Constitutional Chamber of the Supreme Court of Justice, since the Administrative Political Chamber had previously declared inadmissible contentious appeals of nullity owing the administrative silence of the above-mentioned Ministry on the four cases pending for many years.

      The Constitutional Chamber overruled and ordered the Administrative Political Chamber to rule again on the appeals for nullity. The later declared ADMISSIBLE the contentious administrative appeals of nullity and ordered the PTO to grant the above identified applications. Additionally, it ordered to consider the precedents issued by the Supreme Court where it did not find any phonetic or graphic similarities or generic trademarks, in a way that the marks could not coexist peacefully or are characteristic enough with those cases cited by the PTO.

    • Venezuela

      If the licence agreement is executed abroad, the document must be notarised and certified with an apostille, or legalised by a Venezuelan consulate, as the case may be, before it is recorded at the Trademark Office. If the document is executed in Venezuela, the document must be notarised before it is submitted. It is important to mention that all licence agreements must be translated into Spanish by a certified sworn translator.

    • Venezuela

      According to the Venezuelan tax regulations, royalties paid in consideration for the transfer of use of trademarks and service fees paid in consideration for technology services in favour of foreign corporations are subject to an income tax withholding of 34 per cent over the 90 per cent of the royalty payment (that is an effective withholding of 30.6 per cent over the gross royalty payment).   

      Moreover, service fees paid in consideration for technical assistance services in favour of foreign corporations are subject to an income tax withholding of 34 per cent over the 30 per cent of the royalty payment (that is an effective withholding of 10.2 per cent over the gross fee payment).   

      Moreover, royalties and service fees are subject to VAT. However, if the renderer is a foreign non-domiciled corporation, the local corporation is responsible for VAT filling and payments as beneficiary of services or trademark rights or both.   

      Venezuela has executed double taxation treaties (DTT) with 30 countries (the USA, Spain, the Netherlands, Barbados, China, France, Germany, Switzerland, Italy, Austria, Portugal, Russia and Canada, among others). Most DTTs set forth a tax withholding reduction for royalties, being the maximum rates between 5 per cent and 15 per cent, and tax exemption in the case of technical assistance services.    

      Regarding the possibility to deduct all costs of IP development, in principle Venezuelan subsidiaries and corporations are allowed to deduct all costs.    

      Venezuelan tax regulations include a set of tax transparency and anti-avoidance regulations to combat base erosion or evasion of payments of royalties to IP companies located in a low-taxed jurisdiction.   

      There is no distinction for tax purposes between IP that is eligible for legal protection.    

      It is a normal and common mechanism for domestic businesses to participate in cost-sharing agreements to develop or improve IP rights.

    • Venezuela

      The Law to Promote and Protect the Exercise of Free Competition establishes the global block exemption system, which is assessed by the Rule of Reason. In connection with those conducts that involve trademark and patent licences and its effects on the competition, franchises are entitled to apply a pre-approval system: the Global Exception. This regime requires the effective competence within the relevant market not to be excluded from the agreements, which would also contribute with the technical or economic progress and would grant benefits for consumers.   

      At present, there is only one regulation applicable to franchises (Resolution No. SPPLC-038-99, dated 7 January 2000). It was set forth by the Superintendency for the Promotion and Protection of Free Competition, which establishes all of the guidelines pertaining to the Evaluation of Franchising Contracts. The franchisee has the obligation to abide by the following rules:     

      • to own exclusive sale of certain products, or products manufactured exclusively by the franchiser, or a minimum range (line or group) of products;  
      • to subscribe to a non-competition agreement (up to a year) once the contract has ended; and  
      • not to disclose to third parties the know-how transmitted by the franchiser (this obligation could be extended until after the contract is finished).    

      The franchiser is also entitled to recommend the sale prices, and the franchisee may grant the franchiser a non-exclusive licence of the know-how developed during the exploitation of the franchise.   

      There is no market share threshold (there is only a 120,000 TU threshold for economic concentration operations).

    • Venezuela

      Although licence agreements are not automatically terminated in case of bankruptcy, it might affect the licence of the IP rights. The court empowers the trustee to operate the debtor's business. It will depend on a case-by-case basis and it will normally follow the opinion of the trustee. Venezuelan bankruptcy laws establish an order in which a company has to comply with its creditors, therefore, after evaluating the assets of a company filing for bankruptcy; it is possible that an IP right changes ownership as part of the company complying with the creditors. In these cases, the licensee may have a priority right depending on the case. 

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