In Mexico, industrial property rights holders which suffer damages for the violation of their rights, need to file before the Mexican Institute of Industrial Property (IMPI for its name in Spanish), an administrative infringement action against infringers in order to obtain from said Institute a favorable and firm decision that declares the infringement, and exhibit it in a trial followed before a Civil Court with the proofs that demonstrates the link between the infringing act and the damage suffered, and the damage itself, so that, this competent Court could quantify the damages based on a mathematical formula stablished on the Industrial Property Law (LPI for its name in Spanish) to repair them.

Now a day, this claim for indemnity process take so many years so that the holders of the affected rights are demotivated and chooses not to claim their corresponding compensation for the damages caused by a violation of an industrial property right.

In light of the above, there have been several initiatives of reform to modify the compensatory system for recovery damages caused by a violation to an industrial property right, one of them, is the Initiative of reform published in the Gazette of the Upper House of Mexico, on April 2019 which proposes the change of several provisions of the LPI, one of them, section V of Article 6.

Section V of Article 6 of the LPI consists of the list of faculties of IMPI. The reform proposes to provide IMPI with the power to impose appropriate administrative penalties in order to make infringers compensate or assume liability for damages caused by the violation of the rights conferred by the LPI to its holders in the decision that they issued in an infringement action proceeding.

As a result of the statement of reasons and recitals of the initiative of reform, such inclusion apparently seems to provide a better reparatory system and appears to be intended to benefit IP rights holders, as it seeks that in the same decision the IMPI declares the infringement of an industrial property right and determine the damages that must be paid for said infringement.

Even though the Mexican laws already provides for a compensatory system for damage to industrial property rights holders, and its jurisdiction falls to a judicial court such as the Judges of the Civil Courts, it must be questioned whether this system guarantees an adequate compensation.

It should be noted that the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) –Mexico is a member nation–, states that the Courts of each country member shall be empowered to order infringers to pay to the right holder an adequate compensation corresponding the damage suffered as a result of the violation of its intellectual property right.

Considering that, in the case of damages caused by infringements of industrial property rights, in Mexico the holders must wait several years for an IMPI favorable and firm decision, to subsequently file a civil action to recover damages, –and exhibiting all the evidence necessary before the Judges of the Civil Courts, who are not specialists in matters of intangible property, as IMPI is, to demonstrate the link between the infringing act and the damage suffered–, so that, after all procedural steps, the corresponding Judge issues a decision and can be enforced, and that commonly, at this point more than 5 years approximately have elapsed, we might consider that the compensatory system of industrial property damage in Mexico is inadequate for being exhausting for the duration of time it takes.

However, to grant IMPI the power to resolve disputes between individuals, such as the litis corresponding to the claim for recovery damages for the affectation of an industrial property right, it is not exactly to create an adequate and timely recovery damage compensatory system; since such a system requires the creation of various rules for procedural acts and their formalities, and the initiative that has been presented at the Congress ignores the creation of such rules, as the Civil Adjective Law does.

Moreover, being of priority importance, IMPI is an administrative authority and not a Court, and is not empowered by the Mexican Constitution to rule on civil cases, so, to include in its powers to resolve on matters which, by constitutional mandate, it is only for the Judges of the Civil Courts, would not harmonize with the very nature of the legal definition of damage and, even less, with the adoption of an adequate compensatory system stated in the international treaties.

The solution to the inadequacy of our compensatory system is not on changing the structure of how to claim for recovery damages, provided by our legislation, because this actually caters to the essence and nature of each procedural act and competent authority. Even when our Civil Courts are not specialized on intangible property as it is IMPI, the adjective legislation empowers the competent Courts to name a specialized expert in the matter, in case of needing technical knowledge for this evaluation.

In conclusion, the adequacy of our compensatory for damage system in industrial property matters is conditional on the reduction of the excessive times involved in each procedure, therefore, the initiatives of reform, instead of granting IMPI greater responsibilities in contravention of its very nature, must consider important increasing the human resources of the Institute in number, choosing to conserve and not disappear local offices and increase their powers to function as auxiliaries. This would reduce IMPI's resolution times and speed up the proceedings to compensation for damages caused to violations of industrial property rights; incentivizing holders to defend their rights.