Morgan & Morgan
  October 20, 2011 - Panama

Panama and its Importance for the International Protection of Trademarks
  by Allen Candanedo, Associate

The Republic of Panama, using Law No. 35 of May 10, 1996 as a basis, continues making its best efforts to provide the highest possible protection to Intellectual Property, both in the territory of the Republic of Panama as well as also cooperating with the owners of intellectual property rights. Cooperation by means of the firm application of highly effective border measures, which on a regular basis inflict hard blows to those organizations that profit from counterfeit and piracy of marks.

Our country has been a pioneer in the region with respect to its vision for the protection of trademarks, proposing and approving a modern specialized legislation independent from the services related to Intellectual Property.

The mentioned law, as its main element, accepts not only the use of marks in the Republic of Panama, but  the international use of marks as well, which allows the owner of a mark to appear in Panama, through a Process of Opposition
to the Application for the Registration of a Mark, thus preventing the registration of a mark, that is identical or confusingly similar to his, to be carried out by an unauthorized third party.

Since the enactment of Law 35 specialized courts of commerce were created and have been operating, with very good results, to attend the litigations related to Free Competition and Consumer Affairs, which hear specifically trademark cases, with judges and personnel specialized and trained in the subject.  

We can base the importance of the protection of marks in Panama on three key elements:

First, we must emphasize that Panama, apart from being a country with a limited number of effective local consumers,
increases gradually and constantly the total figures of registration of marks. From the year 2000 to the year 2005, the Directorate General of the Registry of the Industrial Property (DIGERPI by its Spanish abbreviation) registered, in average, 7,217 marks in the Republic of Panama. Between the year 2006 and the year 2010 the average increased to 9,717 marks in a year,
that is to say, approximately 2,000 additional marks per year.

The origins of the registrations of marks vary, standing out as the two major countries as to the number of registrations the Republic of Panama with the highest number, followed very closely by the United States of America. The following countries comprising the ten countries with the highest number of marks registered in Panama are as follows:  Switzerland, Mexico, Germany, Colombia, Spain,
, Brazil and Italy.

Second, the National Customs Authority, which for years has been carrying out a careful monitoring work of merchandise in transit through the ports of the country, has increased its efforts and logistics in such a way that it has become the stronghold of the actions carried out by the Republic of Panama as a country to fight against the counterfeit and piracy of marks.

The figures of official retentions performed by the National Customs Authority are self evident: 

In the year 2010 205 retentions of containers were carried out and in the current year 2011 234 retentions have already been carried out. It should be mentioned that the major countries to which the merchandise retained by the National Customs Authority was bound for are, in descending order, Panama, Venezuela, Bolivia, Chile, Colombia, Guatemala, Ecuador, Mexico, Costa Rica and
the United States. The countries of origin of said merchandise are China, in their majority, Russia, Peru, Hong Kong
(SAR), Mexico, Iran, Africa and Chile, among others. The forfeited products that are most frequently retained are
cigarettes, medical products (to treat erectile dysfunction), luxury items (such as purses, sunglasses and clothes in general), watches and perfumes.

Finally, the Colon Free Zone, the second largest duty-free zone in the world, continues its sustained growth, grouping the most varied range of companies importing and re-exporting merchandise coming from China, Europe and the United States of America to the large consumer markets of Central America, the Caribbean, South America and part of Europe.  

The Colon Free Zone allows several forms of commercial presence, among which stand out the two major ones: regular user companies (with all the rights and obligations inherent to the commercial operation of import and re-export of finished products) and represented companies (companies having a presence in the Colon Free Zone through another user company, which provides them with logistic support to handle merchandise). 

These two modalities have increased in number.  This fact attests to the importance and relevance of said zone within the scope of the international trade. In the year 2000, the number of user companies was 1,463 and the represented companies authorized to operate in the area amounted to 493. As of the year 2005, the regular user companies had increased to 1,768 and the represented companies to 684.  Already for the year 2010, the user companies established in the Colon Free Zone amounted to 2,133 and the
represented ones 807.

If we analyze the meaning of this fact in the cumulative commercial movement to the Colon Free Zone and through it, the figures are even more significant: 

As of the year 2006, total imports represented 6,818 million dollars, with re-exports accounting for the amount of 7,666 million and a total turnover of 14,484 million dollars. Already in the year 2010, imports had reached 10,228 million dollars, whereof re-exports accounted for 11,395 million for a total turnover of 22,624 million dollars.

Such as we can observe, the figures speak for themselves:  Panama represents a place of transit of billions in merchandise, as well as the port of entry to Central America, South America and the Caribbean of merchandise coming from all over the world.  A proper protection of marks allows the customs authorities to retain, officially, the merchandise in transit for the necessary investigations to be carried out to the effect of establishing the authenticity of said merchandise for them to either continue to their countries of destination or for the pertinent legal actions to be started for the purpose of establishing who are those responsible for their transit and for said merchandise to be destroyed thus preventing them from reaching the end consumer.

To achieve such proper protection it is necessary for trademark owners to register their marks in The Republic of Panama, and we recommend to proceed not only by obtaining trademark certificates before the DIGERPI, but also to register those before the Intellectual Property Department of the National Customs Authority and the Colon Free Zone Intellectual Property Office.  The costs
are not high for the benefit to be obtained.

* Sources of Information:  Directorate General of the Registry of the Industrial Property, National Customs Authority, Law No.35 of
May 10, 1996


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