Defending trademark rights: Chamber fights to defeat adverse legislation.

In April, General Motors Mexico brought to the attention of AMERICAN CHAMBER/MEXICO a potentially detrimental congressional initiative. The bill would directly impact the franchise industry--or any industry that, with the proposed legislation, would fall under the purview of the franchise law.

Under the proposed reform to the Industrial Property Law in the area of franchises--originally authored by PAN Senator Fauzi Hamdan and subsequently passed by the Senate--entities not heretofore considered franchises, such as automobile distributorships, would be subject to the law's provisions.

More importantly, however, the legislation envisages the possibility that two or more discontented franchisees could contest the franchiser's trademark. No small peanuts. Allowing a company's trademark--the backbone of its business and perhaps its single most valuable asset--to lie openly vulnerable to the whims of disgruntled partners is tantamount to saying: "Investors begone!"

In an effort to prevent the passage of such harmful legislation, AMCHAM's Department of External Relations leaped into action. A quick phone survey of other member companies found the issue went well beyond the automotive industry. To little surprise, it was found that the likes of DaimlerChrysler, Ford, McDonald's, Unilever and Subway Sandwiches are all equally unnerved by the legislation. As a result, a meeting of corporate representatives was called in mid-April to discuss the matter and devise a lobbying strategy.

The Department of External Relations has verified with the congressional Economy Committee that the proposed legislation will not be debated in the current session of Congress. An AMCHAM working group will immediately be formed to develop a consensual position that rejects the proposed legislation and asks for clarification of specific points. A face-to-face meeting with the president of the Economy Committee in the Chamber of Deputies has been formally requested to further discuss the matter.

AMCHAM is committed to halting further discussion of this initiative without an in-depth analysis carried out in conjunction with the parties involved.

For more information on this legislative action plan call AMCHAM National Director of External Relations Olaf Carrera at (55) 5141-3815.