September 26 2005
The Ecuadorian Institute of Intellectual Property has recently denied three applications by companies seeking trade dress protection for the shape of bottles used to sell their products: Compañía de Cervezas Nacionales CA (for its 'Pilsener' beer), Embotelladora Azuaya SA (for its product 'Cristal') and Industrial Fruit del Ecuador CA (for its product 'Fruit'). Before the establishment of the institute in 1998, product containers were granted protection without much examination. With regards to beer bottles - where many shapes were registered as trademarks - this may be explained by the lack of local competition in the past. In 2000 the institute had already rejected some requests for trade dress protection, but the decisions in the three cases at hand are more elaborate and could set new standards for the future, clearly establishing the distinctiveness requirement for trade dress protection.
In the three cases the decisions came as a result of applications to register the bottle shapes as trademarks. In the case of Compañía de Cervezas Nacionales CA, competitor AmBev filed an opposition before the institute's national director of industrial property, claiming that the shape in question lacked distinctiveness. AmBev also alleged that registering the shape would constitute an undue burden on competition, as it was too commonly used by other producers. The dispute triggered a public debate and an advertising war. Finally, the national director of industrial property concluded that the shape of the bottle lacked distinctiveness and thus could not be given trademark protection.
These could be landmark cases for Ecuadorian IP law, which is still at a developing stage. Trade dress protection, for example, is still poorly regulated. In general, trade dress protection should not serve to cause an undue burden on competition. So far, Ecuadorian authorities have agreed only up to a point. Even though the applications for the protection of the bottle shapes have been denied, the 'undue burden on competition' argument presented by AmBev has not been fully addressed by the national director of industrial property. Now, the affected parties in that case can appeal to the institute's Intellectual Property Committee, the highest administrative authority in Ecuador for IP disputes. The cases could eventually go all the way to the Supreme Court.
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