Doing Business in Brazil

4.8. Piracy and the Appropriate Legal Measures in Brazil

06/12/20

At the outset, it should be clarified that piracy can be combated in Brazil through civil and criminal lawsuits, as well as through administrative procedures, such as police investigations.

Criminal court measures applicable to the infringement of trademark registrations, industrial designs, patents and/or unfair competition are initiated through Private Criminal Action, that is, it depends on the initiative of the owners of the infringed registrations.¬† At the same time, by choice of lawmakers, copyright violations are prosecuted through Criminal Proceedings in the Public Interest, such that it depends on the initiative of the Public Prosecutor’s Office.

Specifically regarding criminal liability in Brazil, it is important to highlight that such liability is governed by the so-called “principle of legality”.¬† Thus, according to Art. 1 of the Penal Code, “there is no crime without a previous law that defines it (…)”,meaning no-one will be punished if there is not previously a law defining the specific situation as a crime.

That principle is closely linked to the doctrine that criminal behavior must be described exhaustively.  In view of this, according to Brazilian Criminal Law, an act will only be considered a crime if defined specifically and detailed by law.

When the aforementioned rules are applied to Intellectual Property issues, the result is that only specific acts described as crimes by the Criminal Code (in the case of copyright) and the Brazilian Trademark and Patent Law (in the case of registered trademarks, patents and unfair competition) should be punished.

The Brazilian legislation on intellectual property rights is as follows: Industrial Property Law No. 9,279/1996 (covers patents, industrial designs, trademarks and unfair competition); Copyright Law No. 9,610/1998; Software Law N¬ļ. 9,609/1998; Penal Code (provides for some aspects of copyright); Code of Criminal Procedure; and Code of Civil Procedure (the latter two applicable to all Intellectual Property rights).

Accordingly, each kind of intellectual property is individually regulated by the laws specified above as follows:

  • Patents

Under Articles 183 to 186 of the Industrial Property Law, an infringement of a patent is committed by whoever: manufactures a product that is the object of a patent of invention or utility model, without authorization from the owner; uses a means or process that is the object of a patent of invention, without authorization from the owner; exports, sells, exhibits or offers for sale, holds in stock, conceals or receives, for use for economic purposes, a product manufactured with infringement of patent of invention or utility model, or obtained by a patented means or process; imports a product that is the object of a patent of invention or a utility model or obtained by a means or process that is patented in the country, for the purposes previously provided for, and that has not been placed on the foreign market directly by the patentee or with his consent; provides a component of a patented product, or material or equipment to carry out a patented process, provided that the final application of the component, material or equipment necessarily induces the exploitation of the patent object.  Such crimes are also characterized even if the infringement does not impact all the patent claims or is restricted to the use of means equivalent to the object of the patent.

  • Industrial Designs

Under Articles 187 and 188 of the Industrial Property Law, an infringement of an industrial design is committed by whoever: manufactures, without authorization of the owner, a product that incorporates a registered industrial design, or a substantial imitation thereof that is likely to mislead or cause confusion; exports, sells, exhibits or offers for sale, holds in stock, conceals or receives for use for commercial purposes, an object that unlawfully incorporates a registered industrial design, or substantial imitation that may lead to error or cause confusion; imports a product that incorporates an industrial design registered in the country, or substantial imitation thereof that may lead to error or cause confusion, for the purposes previously foreseen, and that has not been placed on the foreign market directly by the owner or with his consent.

  • Trademarks

Under Articles 189 and 190, both of the Industrial Property Law, a trademark infringement is committed by whoever: reproduces, in whole or in part, a registered trademark, without the authorization of the owner, or imitates it in a manner that may cause confusion; alters the registered trademark of another person already affixed to a product on the market; imports, exports, sells, offers or exhibits for sale, conceals or keeps in stock a product bearing a trademark of another party which is unlawfully reproduced or imitated, in whole or in part; or a product of his or her industry of commerce, held in a vessel, container or packaging bearing the legitimate mark of another person.

  • Unfair Competition

In turn, unfair competition is classified as a crime by Article 195 of the Industrial Property Law, the respective criminal acts of which are committed by whoever: publishes, by any means, a false statement, to the detriment of a competitor, in order to obtain advantage; provides or discloses false information detrimental to a competitor with the aim of obtaining an advantage; uses fraudulent means to divert the customers of another party for his or her own profit or that of another party; uses the advertising expression or sign of another party, or imitates it in a manner liable to cause confusion between the products or establishments; makes undue use of another party’s commercial name, establishment name or insignia or sells, exhibits, offers for sale or has in stock a product bearing those references; substitutes on the product of another party the name or company name of such party, without his or her consent, with his or her own name or company name; claims, by way of advertising, to have received a prize or distinction that he or she has not actually been awarded; sells, exhibits or offers for sale, in a container or packaging of another, an adulterated or counterfeit product, or uses such container or packaging to trade with a product of the same type, even if not adulterated or falsified, if such does not constitute a more serious offense; gives or promises money or other consideration to an employee of a competitor in return for which the employee, failing in his or her duties of employment, provides him or her with an advantage; receives money or other consideration, or accepts a promise of payment or reward in return for providing an advantage to a competitor, thereby failing in his or her duties of employment; publishes, exploits or uses, without authorization, confidential knowledge, information or data which may be used in industry, commerce or service provision, except where such confidential knowledge, information or data are in the public domain or are obvious to a person skilled in the art, to which he or she has had access due to a contractual or employment relationship, even after termination of the contract; publishes, exploits or uses, without authorization, such knowledge or information referred to in the previous item, obtained by illicit means or to which he or she has had access by fraud; sells, exhibits or offers for sale a product that he or she wrongly states to be subject of a patent filed or granted, or of a registered industrial design or who wrongly states in a commercial announcement or paper that such product has been filed, patented, or registered; publishes, exploits or uses without authorization, the results of tests or other undisclosed data that have been developed involving a considerable effort and which has been submitted to government entities as a condition for the approval of the marketing of products.

Copyright

Unlike other intellectual property rights, with regard to copyright, Law No. 9,610/98 expressly states that the respective protection occurs independently of any previous record, the corresponding owner having the right to protection against pecuniary and non-pecuniary damages related to the work created.

Moreover, according to Art. 184 of the Penal Code, a crime is committed by whoever infringes copyright and related rights, even more so if: the infringement consists of total or partial reproduction, with the purpose of direct or indirect profit, by any means or process, of intellectual work, interpretation, execution or phonogram, without express authorization of the author, the interpreting artist or performer, the producer, as the case may be, or whoever represents them; whoever, for the purpose of direct or indirect profit, distributes, sells, exhibits for sale, rents, introduces into the country, acquires, conceals, has in storage, an original or copy of intellectual work or phonogram reproduced in violation of copyright, of the right of an interpreting artist to performer or of the right of the producer of the phonogram, or else rents an original or copy of intellectual work or phonogram, without the express authorization of the right holders or whoever represent them; the infringement consists of offering to the public, by cable, optical fiber, satellite, waves or any other system that enables the user to perform the selection of the work or production to receive it at a time and place previously determined by the person who makes the demand, with the intention of profit, direct or indirect, without express authorization, as the case may be, from the author, the interpreting artist or performer, from the phonogram producer, or whoever represents them.

It is also certain that the act will not be classified as a crime when it is an exception or limitation to copyright or connected rights, according to exceptions specified in Law No. 9,610/1998, nor the copying of intellectual work or phonogram, in a single copy, for private use of the copyist, without intention of direct or indirect profit.

Moreover, in the criminal sphere, it is not possible to apply an objective liability for intellectual property infringement (differently from what the Brazilian Civil Code states), especially considering that only intentional (willful) acts are defined as crimes against Intellectual Property.¬† In turn, Art. 18 of the Brazilian Penal Code establishes the rule that a crime is deemed to be intentional when “the agent wanted the result or took the risk of producing it”.

Therefore, the intent is the main element that allows the Code of Criminal Procedure to prosecute and punish offenders.  For this reason, no-one shall be punished in the event of committing an intellectual property crime without intent.

Also with regard to criminal liability for intellectual property infringement, it is possible that a natural person (e.g. an officer or employee) will be personally prosecuted and held liable for an infringement committed by a legal entity, different to that which occurs in civil liability.

As explained earlier, the infringement of trademarks, industrial designs and patents are criminally prosecuted through a Private Criminal Action, a process instituted after a request for police to investigate (Notitia Criminis) before the local Police Station.

In contrast, copyright infringements are prosecuted criminally through Criminal Proceedings in the Public Interest Action, the process of which begins after the filing of a request for a Preparatory Measure before the local Court, being directly promoted by the Public Prosecutor’s Office.

Below are two flowcharts that illustrate both procedures:

 

Finally, it is worth mentioning that as dictated by Art. 387, IV of the Code of Criminal Procedure, when the judge convicts the offender, he must also stipulate in the sentence a minimum amount of compensation for civil damages.  However, it will be up to the interested party to take legal proceedings to claim any financial compensation in an amount greater than that previously established in the criminal court, through the production of appropriate evidence.


Authors: Nathália Gonzalez Conde and José Henrique Vasi Werner

Dannemann Siemsen

Rua Marqu√™s de Olinda, 70 ‚Äď Botafogo
BR-22251-040 Rio de Janeiro RJ
Tel (21) 2237 8700

[email protected]

Dannemann S√£o Paulo

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04063-000 S√£o Paulo ‚Äď SP
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