Mexico City, October, 2020
On March 27, 2020, an amendment to Official Mexican Standard 051-SCFI/SSA1-2010 was published in the Federal Official Gazette with respect to the “General Labeling Specifications for Prepackaged Food and Non-alcoholic Beverages – Commercial and Health Information” (hereinafter NOM-051), whose purpose is, among others, to indicate:
«health and commercial information which labels of prepackaged domestic or foreign products sold in Mexico must contain, including foods and non-alcoholic beverages that are prepackaged when purchased by the end consumer, for which it is not applicable to bulk products, products packed at the point of sale or prepackaged products subject to a specific Official Mexican Standard (“NOM”) or other regulations that exclude the Amendment.»
These amendments, which apparently do not directly affect intellectual property rights-holders, pose a considerable challenge when discussed in greater detail. Let us begin by noting that the amendment to NOM-051 is particularly relevant because it includes changes relating to the ban on:
- Including any indication that the product, its use, ingredients or any other characteristic is recommended or supported by professional associations or companies;
- Indicating that a product is exempt from the statement of the foregoing signs; and
- Including children’s characters, animations, cartoons, celebrities, athletes or pets, interactive elements – such as visual-spatial games or digital downloads – directed towards children that motivate, promote or encourage the consumption, purchase or choice of products with excess critical nutrients or sweeteners.
In this context, the Health Ministry proposed amendments that limit two relevant issues of intellectual property rights, specifically the use and exclusivity of owners, mainly businesses, which use characters or designs to promote their products, whether such are protected as trademarks or copyrights. Thus, we consider that NOM-051 was issued without conducting a proper analysis on the matter in accordance with the following considerations:
- Intellectual Property Rights (trademarks and copyrights) in addition to being human rights, constitute exclusive rights that cannot be restricted and affected by a secondary standard, even if it is intended for health care.
- Such NOM violates Federal Intellectual Property and Copyright Laws, since it affects intellectual property rights-holders by limiting their right of use, free competition and the exercise of their exclusivity rights.
- Additionally, in our opinion, the restrictions under NOM-051 are illegal, because the Government has not provided evidence demonstrating that they help achieve the purpose of the standard – correlated with the General Health Law – that is, that the removal of design marks or characters does not guarantee that consumers will stop purchasing products and discourage overconsumption to fight overweight.
- The NOM violates trade agreements which Mexico has signed by creating unnecessary and inappropriate trade barriers; i.e. establishing more labeling requirements and restricting the use of design marks on products.
- Before implementing such obstacles and restrictions, the Government must acknowledge the importance of implementing public policy aimed towards educating people so that they decide for themselves which products to consume.
- Moreover, Mexico has signed the USMCA (which entered into force on July 1st, 2020), which contains a coherence and cooperation section that prevents unnecessary regulatory burdens and this will also apply to the NOM in question. The amendments are aimed towards a practice known as plain packaging which results in consumers not being able to differentiate certain products.
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The foregoing arguments are a summary of the various legal elements available to challenge such NOM, if this course of action is decided; as legal professionals we must consider a defense of our clients’ intellectual property by filing convincing and effective measures, in particular, filing constitutional rights protection proceedings (Amparo Indirecto), since Article 28 of the Constitution and the right to free competition are clearly being violated.
In this context, the law itself provides that such constitutional rights protection (amparo) proceedings may be brought against a general provision (such as NOM-051) by its mere entry into force or upon the first application thereof. In this respect, the standard referred above provides that such reform will enter into force, with regard to the front labeling, on October 1, 2020, for which the Amparo Proceedings to challenge this part of the reform would have to be filed prior to November 11, 2020.
In furtherance of the foregoing, since the FIRST transitional article of such standard provides that the rest of the reforms (including in connection with the use of characters, drawings, etcetera) will enter into force on April 1, 2021, it is possible to conclude that indirect amparo proceedings could be filed against that specific part until May 13, 2021.
In this order of ideas, in the event that only this specific part of NOM-051 is alleged to be unconstitutional and contrary to human rights, we could agree with this second approach, because there are criteria upheld by our maximum courts that perfectly explain that filing Amparo Proceedings during the “vacation legis” is not admissible since the legal interest is not evidenced as the standard is still not effective.
To sum up, NOM-051 does adversely impact the intellectual property rights of various holders and considering that copyrights and trademark rights involved through images, cartoons or characterizations and the like may often be even more distinctive and identifiable by consumers than product names, nothing less than a strong legal defense of their intangible assets is expected from such holders, although we will face a discourse justifying the defense of public health, which unfortunately is a serious problem in our country.
[1] The Mexican government itself raised similar concerns in the World Trade Organization (WTO) Committee on Technical Barriers to Trade (TBT) when Chile noted that it would launch its stop signal system in 2013. The government then noted that the Chilean system diverged from the global consensus established in the Codex Alimentarius, and that the system lacked apparent scientific or technical support to justify its use. Manufacturers agree that these concerns are well founded.
As the government correctly believed then, systems such as the Chilean model create an overly simple framework that creates trade barriers without fully considering the range of nutrients and characteristics that can contribute to obesity or real-world reference frameworks for consumption.
