The debate over the effectiveness of enforcement against industrial property infringements has reached an fectiveness of enforcement against industrial property infringements has reached an institutional turning point in Brazil. institutional turning point in Brazil. As widely discussed in the final report of the Brazilian Chamber of Deputies’ As widely discussed in the final report of the Brazilian Chamber of Deputies’ External Committee on Counterfeiting and reflected in legislative proposals such as Bill No. 3,375/2024, Brazil’ External Committee on Counterfeiting and reflected in legislative proposals such as Bill No. 3,375/2024, Brazil’ss legal framework is preparing to address longstanding gaps that have contributed to a perception of impunity and le
Bill No. 3,375/2024 directly addresses the core of the of Bill No. 3,375/2024 directly addresses the core of the offense established under fense established under Article 189 of the Industrial Article 189 of the Industrial Property Law (Law No. 9,279/1996). By proposing an increase in the applicable penalty from three months to Property Law (Law No. 9,279/1996). By proposing an increase in the applicable penalty from three months to one year of detention to two to four years of imprisonment, the bill would remove trademark of one year of detention to two to four years of imprisonment, the bill would remove trademark offenses from the fenses from the jurisdiction of Brazil’ jurisdiction of Brazil’s Special Criminal Courts under Law No. 9,099/1995. From a procedural perspective, s Special Criminal Courts under Law No. 9,099/1995. From a procedural perspective, moving beyond the simplified framework applicable to minor of moving beyond the simplified framework applicable to minor offenses would restore essential investigative and fenses would restore essential investigative and prosecutorial tools for dismantling or prosecutorial tools for dismantling organized networks, including robust asset-preservation measures, access to ganized networks, including robust asset-preservation measures, access to banking and tax records, and genuinely deterrent criminal sanctions. banking and tax records, and genuinely deterrent criminal sanctions.
This enhanced enforcement framework, however This enhanced enforcement framework, however, must be closely coordinated with the civil and regulatory , must be closely coordinated with the civil and regulatory dimensions of digital distribution, requiring rights holders and IP dimensions of digital distribution, requiring rights holders and IP practitioners to focus on several critical areas practitioners to focus on several critical areas of transformation. of transformation.
The first concerns liability for the fragmented trade in inputs and the facilitation of counterfeiting. Criminal The first concerns liability for the fragmented trade in inputs and the facilitation of counterfeiting. Criminal networks have professionalized the separate distribution of authentic or reproduced components, such as caps, networks have professionalized the separate distribution of authentic or reproduced components, such as caps, bottles for high-value spirits, labels, security seals and distinctive tags. Marketed on online platforms under bottles for high-value spirits, labels, security seals and distinctive tags. Marketed on online platforms under misleading descriptions such as “craft” or “collectibles,” these items feed clandestine manufacturing operations misleading descriptions such as “craft” or “collectibles,” these items feed clandestine manufacturing operations that ultimately supply the legitimate market. that ultimately supply the legitimate market. The express criminalization of the possession, storage and sale of The express criminalization of the possession, storage and sale of such inputs, as contemplated by initiatives such as Bill No. 5,807/2025, strengthens the legal basis for such inputs, as contemplated by initiatives such as Bill No. 5,807/2025, strengthens the legal basis for characterizing material assistance to infringement and parasitic unfair competition under characterizing material assistance to infringement and parasitic unfair competition under Article 195 of the Article 195 of the Industrial Property Law Industrial Property Law, allowing enforcement measures to reach those who facilitate the chain before the final , allowing enforcement measures to reach those who facilitate the chain before the final product is filled or assembled. product is filled or assembled.
Equally significant is the evolution from static notice-and-takedown mechanisms toward an objective duty of Equally significant is the evolution from static notice-and-takedown mechanisms toward an objective duty of digital prevention. digital prevention. The unrestricted application of the framework established by The unrestricted application of the framework established by Article 19 of the Brazilian Civil Article 19 of the Brazilian Civil Rights Framework for the Internet (Marco Civil da Internet), originally designed primarily to safeguard freedom Rights Framework for the Internet (Marco Civil da Internet), originally designed primarily to safeguard freedom of expression on social networks, has proven incompatible with the dynamics of online marketplaces that of expression on social networks, has proven incompatible with the dynamics of online marketplaces that directly generate revenue from facilitating the sale of physical counterfeit goods. Contemporary enforcement directly generate revenue from facilitating the sale of physical counterfeit goods. Contemporary enforcement requires concrete duties of care, including rigorous validation of sellers’ requires concrete duties of care, including rigorous validation of sellers’ corporate and individual registration corporate and individual registration data, proactive image- and metadata-based screening of repeat of data, proactive image- and metadata-based screening of repeat offenders, and preventive withholding of fenders, and preventive withholding of payments where there are well-founded suspicions of fraud, thereby moving beyond a system that places the payments where there are well-founded suspicions of fraud, thereby moving beyond a system that places the entire enforcement burden on the rights holder entire enforcement burden on the rights holder..
From a trademark perspective, the challenge is not limited to removing an individual listing, but extends to preventing the same infringement from being immediately reproduced through new listings, accounts, or seller preventing the same infringement from being immediately reproduced through new listings, accounts, or seller profiles. Repeated infringement materially reduces the ef profiles. Repeated infringement materially reduces the effectiveness of isolated takedown measures and fectiveness of isolated takedown measures and increases the enforcement costs borne by rights holders, particularly where the platforms possess information increases the enforcement costs borne by rights holders, particularly where the platforms possess information capable of identifying patterns of conduct. capable of identifying patterns of conduct.
This issue assumes even greater significance as digital commerce expands, with the multiplicity of sellers and This issue assumes even greater significance as digital commerce expands, with the multiplicity of sellers and the speed at which listings can be replaced making enforcement based exclusively on post-infringement notices the speed at which listings can be replaced making enforcement based exclusively on post-infringement notices increasingly inef increasingly ineffective. fective. The combination of preventive mechanisms, identification of repeat infringers and The combination of preventive mechanisms, identification of repeat infringers and preservation of relevant data can shift enforcement from a purely reactive response toward a more ef preservation of relevant data can shift enforcement from a purely reactive response toward a more effective fective approach to actors who repeatedly exploit third-party trademarks. approach to actors who repeatedly exploit third-party trademarks.
Finally, enforcement actions must focus on depriving infringers of their economic assets and neutralizing the , enforcement actions must focus on depriving infringers of their economic assets and neutralizing the infrastructure that supports illicit activity infrastructure that supports illicit activity. . The success of civil and criminal proceedings can no longer be The success of civil and criminal proceedings can no longer be measured solely by the quantity of peripheral goods seized from transit warehouses, which infringers may measured solely by the quantity of peripheral goods seized from transit warehouses, which infringers may simply regard as an operating cost. Following the hardening approach already approved by the Brazilian Senate simply regard as an operating cost. Following the hardening approach already approved by the Brazilian Senate through initiatives such as Bill No. 3,000/2025, which provides for the definitive forfeiture and destruction of through initiatives such as Bill No. 3,000/2025, which provides for the definitive forfeiture and destruction of machinery and manufacturing inputs used in the clandestine production of tobacco-related products, trademark machinery and manufacturing inputs used in the clandestine production of tobacco-related products, trademark litigation should prioritize the financial disruption of infringing operators by seeking the judicial forfeiture and litigation should prioritize the financial disruption of infringing operators by seeking the judicial forfeiture and disabling of industrial molds and machinery disabling of industrial molds and machinery, the freezing of assets held by shell companies, and damages capable , the freezing of assets held by shell companies, and damages capable of fully neutralizing the profitability of trademark parasitism. of fully neutralizing the profitability of trademark parasitism.
The new regulatory and jurisprudential environment will consequently require law firms and trademark The new regulatory and jurisprudential environment will consequently require law firms and trademark departments to adopt an increasingly coordinated approach: on the one hand, leveraging strengthened criminal departments to adopt an increasingly coordinated approach: on the one hand, leveraging strengthened criminal enforcement to reach the governance structures of or enforcement to reach the governance structures of organized crime; on the other ganized crime; on the other, pursuing strategic civil , pursuing strategic civil litigation aimed at establishing the liability of logistics chains and technology intermediaries. litigation aimed at establishing the liability of logistics chains and technology intermediaries.
