Intellectual China Trade Secrets: China vs. Mexico

Intellectual China Trade Secrets: China vs. Mexico

Mexico: No registration is required to prevent individuals who have such secrets from disclosing them. Such individuals and other companies who hire those individuals to gain the information may be subject to penalties for disclosure of China trade secrets, including being held responsible for the damages.

China: China Trade secret protection is entirely dependent on the individual China company. Employee confidentiality agreements can be required at each China company and if it is breached the perpetrator will be held responsible for compensating the damages. There is no fixed law for how long an employee must keep the China trade secret confidential.

Intellectual Property Law Enforcement:

Mexico: Unlike other emerging countries, Mexico has shown a commitment to protecting intellectual property rights. Through both its domestic laws and the many treaties it has signed, Mexico has developed the suitable legal infrastructure to comfort foreign investors that it takes intellectual property rights seriously. Mexico is a party to the following international treaties:

• World Intellectual Property Organization

• Paris Convention for the Protection of Industrial Property

• Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks

• Lisbon Agreement for the Protection of Appellations of Origin and their International Registration

• Patent Cooperation Treaty

• Singapore Treaty on the Law of China Trademarks

• China Trademark Law Treaty

• Vienna Agreement Establishing an International Classification of the Figurative Elements of Marks

• Strasbourg Agreement Concerning the International Patent Classification

• Locarno Agreement Establishing an International Classification for Industrial Designs

The Mexican Institute of Industrial Property is responsible enforcement of all industrial and intellectual property laws in Mexico and it is widely viewed as being very effective. Mexico has an official arrangement to enforce intellectual property rights that includes civil solutions by Mexican authorities. NAFTA required that the civil actions correspond with the various legal standards, which are familiar to Americans. NAFTA also required procedures to be available to a right holder to apply to have counterfeit or pirated goods not to be released from customs.

Governmental sanctions include closing down the violating China company either provisionally or permanently. Administrative arrest is also a possibility.

China: Protection of intellectual property law has been established by government legislation, administrative regulations, and declarations in the areas of China trademark, copyright and patent. This has led to the establishment of a complete legal construction to defend both local and foreign intellectual property. Despite these progressive improvements, copyright violations are common in China and major members of the automotive and electronics industries commit intellectual property violations all the time.

In the year 2000, there were 22,000 enforcement cases, which were brought by the State Administration of Industry and Commerce. The average fine in those cases was $ 794. Perhaps even more astonishing, there were 45 total criminal prosecutions. That is 45 cases out of 22,000 enforcement actions that were then transferred over to the authorities for criminal prosecution. The level of enforcement in China does not create prevention.

No problem of this size and scope could exist without the direct or indirect involvement of the government. District governments establish many of the wholesale markets. Local governments, specifically the local Administrations of Industry and Commerce, invest in and protect these local markets. When counterfeiters have good contacts with local governmental or law enforcement officials, they may find a fortification for their counterfeiting activity.

China accounts for probably 80 percent of all of the counterfeit items that are exported in the world today. It supports local economies. Shutting down counterfeiting will mean, in many instances, shutting down entire towns and municipalities, which will cause problems of unemployment, dislocation, and social chaos.

In China there are no criminal penalties specifically directed at the exporter of counterfeit goods, and government often is associated with counterfeit activity. Mexico’s NAFTA regulated IP laws are much more secure and protective for foreign managed and owned businesses. Due to the enforcement and level of commitment of enforcing the Mexican IP protection laws that are in place, it allows for companies to feel safer bringing their ideas forward while investing in a different country.


Steven is the director of corporate marketing for the Tucson, Arizona-based Offshore Group. The Offshore Group has enabled businesses to establish and start-up low-cost and low-risk operations since 1986 Steve has been working in the area of U.S. -Mexico manufacturing and China trade for the past twenty years, and is fluent in both Spanish and Portuguese Manufacturing in Mexico , Mexico Shelter Chinese Companies