Legal framework On joining the World Trade Organisation in 1995, Costa Rica adopted several international obligations regarding IP matters. In particular, the Agreement on Trade-Related Aspects of IP Rights (TRIPs) set forth minimum standards of protection, enforcement and dispute settlement of IP rights, bringing the country’s domestic procedures and remedies into line with international standards. As a result of the enforcement of the Dominican Republic-Central America Free Trade Agreement, Costa Rica acceded to a number of obligations that resulted in the modification of its IP laws; consequently, the legal system was further strengthened and modified to comply with international standards. There is a welldefined and harmonised legal system in place, with a broad understanding of rights holders’ requirements. The legal instruments most relevant to IP rights are as follows: • TRIPs; • the Dominican Republic-Central America Free Trade Agreement; • the Paris Convention; • the Rome Convention; • the International Union for the Protection of New Varieties of Plants; • the Trademark Law Treaty; • the Budapest Treaty on the International Recognition of the Deposit of Microorganisms for the Purposes of Patent Procedure; • the World Intellectual Property (WIPO) Copyright Treaty; • the WIPO Performances and Phonograms Treaty; • the Patent Cooperation Treaty; • the Berne Convention; • the Lisbon Agreement; • the Trademark Law (7978); • the Patent Law (6867); • the Copyright Law (6683); • the Law on Enforcement Proceedings of IP Rights (8039); • the Undisclosed Information Law (7975); and the Public Spectacles, Audiovisual and Printed Materials Law (7440). Border measures Article 16 of the Law on Enforcement Proceedings of IP Rights states that Customs may act ex officio when it suspects that an IP right is being infringed; it may detain and suspend the release of suspected counterfeit merchandise. However, Customs lacks a proper identification system by which to determine whether a product is counterfeit. Therefore, it is forced to seek advice from the rights holder’s legal representatives. The main problem lies in contacting the legal representatives during the 10-day deadline that Customs has to detain merchandise; if Customs fails to contact the representative or if the representative fails to review the merchandise in order to determine whether it is counterfeit, Customs is forced to release the goods. There is a significant lack of technical knowledge within Customs in regard to violations of IP rights. There is no official database of trademark owners; however, Customs does have an unofficial record of trademark owners, and there have been numerous attempts to establish a voluntary recordal of right holders. Criminal prosecution In accordance with Article 61 of TRIPs, one of the main features of the Law on Enforcement Proceedings of IP Rights is a series of provisions to safeguard rights derived from trademarks, copyrights and layout designs of integrated circuits (Articles 44 and following). Such crimes are punished by way of imprisonment or a fine. In the past, the infringement of IP rights held little importance for the Costa Rican authorities. This was partly due to economic and cultural issues, but was primarily related to a lack of political will. Until recently, the prosecution of IP crimes was left to prosecutorial discretion, since such crimes were considered to cause little harm. However, with the various commitments made via the enforcement of the Dominican Republic-Central America Free Trade Agreement, Costa Rica’s inclusion on the Priority Watchlist of the Special 301 Report, prepared by the Office of the US Trade Representative, and the changing attitude of the Attorney General’s Office, prosecutorial discretion with regards to this type of crime is slowly disappearing. However, there are still serious budget constraints hindering the implementation of a model prosecution system. There remains the need to assign higher priority and allocate greater resources to the fight against piracy and counterfeiting, as well as the necessity of seeking deterrent penalties. Civil enforcement Rights holders can take action to enforce their rights in civil courts. Section I, Chapter IV of the Law on Enforcement Proceedings of IP Rights lays down the rules related to civil procedures. This law refers to the Civil Procedure Code for the application of precautionary measures and the procedure established in the abbreviated system. Cases of unfair competition are resolved through summary proceedings pursuant to Article 17 of the Consumer Protection Law, which refers to Article 432 of the Civil Procedure Code. In both procedures, there exists a procedural opportunity where a party can submit further proof; however, it is left to the judge’s discretion whether to take it into account. Additionally, a party can file an incidental proceeding of new facts that did not exist at the time that the lawsuit was filed. It is always possible to settle before or during the litigation process. The agreement must be homologated by the court. Notwithstanding the above, the fight against judicial delays is far from over, which severely affects the effectiveness of such actions. Anti-counterfeiting online Unauthorised e-commerce There are no specific legal instruments to promote online anti-counterfeiting practices. Furthermore, the use of technology to monitor the Internet and identify online sales, locate sellers and supply chains and identify the source jurisdiction of merchandise is not a common practice among local authorities. As mentioned, the Law on Enforcement Proceedings of IP Rights establishes civil and criminal mechanisms to defend IP rights. In this regard, civil mechanisms entail filing proceedings for trademark infringement and/or unfair competition. Criminal offences include trademark counterfeiting and selling, storing or distributing counterfeit products. For criminal offences, it is possible to request remedies such as restitution, seizure of goods, destruction and imprisonment. Internet security At present, the only legal sources related to this matter are the Regulations for Limiting the Liability of Internet Service Providers (ISPs) for Breaches of Copyright and Related Rights (Official Decree 36880). This legal source sets forth the responsibility of ISPs. Online investigation strategies As stated, the use of technology to monitor the Internet and identify online sales, locate sellers and supply chains and identify the source jurisdiction of merchandise is not a common practice among local authorities. ISP liability The regulations set forth the responsibility of ISPs, and establish that once an ISP becomes aware of illegal consumer activity, or should have become aware of the activity with reasonable diligence, the ISP will be liable for the consumer’s actions. Preventive measures/strategies Use of local counsel and investigators The Law on Enforcement Proceedings of IP Rights provides the opportunity to obtain government assistance in the fight against piracy and counterfeiting. The law punishes all conduct which confuses consumers about the origin, quantity, quality and nature of a registered product. The law also states that the owner of an IP right or its representatives may request the courts to order Customs to suspend the release of merchandise that it believes infringes its rights. Furthermore, Article 16 of the law states that Customs may act ex officio when it suspects that an IP right is being infringed – it may detain and suspend the release of suspected counterfeit merchandise. In addition, Article 5 provides for precautionary measures, including: • immediate cessation of the acts that constitute the infraction; • confiscation of the illegal or counterfeit merchandise; • detention of merchandise by Customs; and • the guarantee of a deposit by the counterfeiter. Contractual relationships with third parties Costa Rican legislation makes no reference to the control of contractual relationships with third parties. It states only that rights holders may initiate precautionary measures, border measures, administrative procedures and civil and criminal procedures against any counterfeiter. Article 27 of the Trademark Law states that a trademark registration does not allow the rights holder to prohibit third parties from using its trademark on products that have been legitimately introduced onto the local market. Distribution and manufacturing contracts are regulated by civil law; therefore, both parties may agree on the terms of such a contract. In most cases, such contracts are not exclusive; therefore, there are no preventive measures or strategies that may be taken in order to prevent counterfeit merchandise entering onto the market.
Effective use of technology The government does not own the technology to recognise counterfeit merchandise. As already mentioned above, Customs must contact the rights holder’s legal representatives in order to determine whether the products are counterfeit. Cooperation with national anti-counterfeiting agencies Although there is institutional awareness that changes must be made not only quickly, but also efficiently, to date efforts have been insufficient. Seminars and workshops are being conducted to raise awareness among officials and the community in general concerning the importance of protecting IP rights. An Inter-Institutional Liaison Committee for the Protection of Intellectual Property comprised of national public institutions has been established to identify the weaknesses and strengths of the existing IP regime. Nevertheless, greater efforts are required. In 2010 Costa Rica established a fiscal control policy to investigate all merchandise that enters and exits the country. Through this, rights holders or their representatives are alerted of possible counterfeit products.