Contents of this issue:
Intellectual Property
Due diligence
INTELLECTUAL PROPERTY
Don´t forget that the forthcoming agreement, TLC, may bring lots of changes in our legalsystemm. For instance Legislation 173 for protection of agents of foreign corporation is likely to disappear. Are you prepared? So you really understand the implications and insights of these changes? Be one step ahead and protect your trademark and tradenames.
In the Dominican Republic as signatory of the most important International conventions related with intellectual property, we have a very good and advance legislation of Industrial Property. Legislation 20-00. Legislation 20-00 protects inventions utility models, patents trademark and tradenames. Legislation 65-00 protects copyright, and legislation 126-02 protects electronic commerce. For more on this topics go to trademark-registration.com.do.
TRADEMARK
Legislation 20-00 protects distintive names designed to distinguish goods and services provided by the owner of the mark, it can be a distintive word, term, or a sign and its objective is to protect them from other similar products. According to article 72 of Act 20-00 a trademark can be "words, made-up names, names, pseudonyms, commercial slogans, letters, numbers, monograms, invented words, pictures, labels, shields, prints, vgnettes, ornamental borders, lines and bands, combinations and arrangements of colors and three dimensional forms. In addition trademarks may consits of the form, presentation or shape of products or their containers or packaging, or the means or places of selling the products or services to which they apply." Go to trademark-registration.com.do
COPYRIGHT
Protect original work of authorship such as art, motion picture, literary works, computer programs, musical compositions. This kind of works are protected from piracy by Law 65-00 and the Executive Power 362-01.
PATENTS
Is an ownership right that grants a monopoly for the use and develpment of an invention or discovers new services, devices, new uses, or methods to manufacture products. The rights over the patents are alsocoveredd by legislation 20-00.
Fees and costs
Registration of a tradename......US$400.00
Registration of a trademark.......US$400.00
Additional class of mark.............US$275.00
Objections to registration..........US$750.00
Sales on license of trademark....US$300.00
Investigation of Availability........US$125 or 75 each class.
Slogans and short phrases........US$700.00
Copyrights.................................US$650.00
Renovation of marks..................US$325.00
DUE DILIGENCE
This term does not have a one-to-one equivalent in Spanish, and is found in our civil code neither implicitly nor as a concept. However, in every type of transaction, it is quite common in legal practice to grant, especially to buyers, a period of time to get prepared, to conduct certain proceedings or investigations regarding such matter and the legal instruments that will support it.
We may say then, that due diligence is a period for "carrying out", for making, as we say in French law, as a positive obligation, such effort (diligence) as is needed for a certain deal or operation to be taken to fruition or to be formalized.
As regards real-estate investments, we often find ourselves in need of carrying out various undertakings, proceedings or investigations in order to accomplish a sale with proper assurance. In most cases, such term is implicit and is found within the time provided to perform the final sale contract when there has been a previous promise of sale, with or without earnest money deposit or handsel.
A practical discussion would be: A) the validity of the causes containing a due diligence period or the validity of the contract itself; B) what happens with the obligations contained in the agreement pending due diligence? C) Are such obligations really dependent on due diligence, or in other words, is there no obligation, transaction or legal instrument without due diligence? At first sight it appears that in the event of annulment of the clause by means of which the need to act with due diligence was agreed or contracted, the covenant, legal act (contract), and the business formalized by the same would become null and void. However, in practice this is not so simple, because on one hand such period or actions constitute a warranty for the buyer, but at the same time are often prejudicial to the buyer whose operation would be (at least in common practice) subordinate to such proceedings.
First of all, it should be noted that most provisions regarding sales in our legislation are not a matter of public order. A classic example is that of the guaranties given to buyers. In accordance with our Civil Code, a buyer may stipulate in a contract that he/she is buying without warranties. Due diligence being a derivate of such warranties, nothing seems to object to its validity in the Dominican Republic.
Secondly, for over fifty years the legal tendency has been (particularly in the area of business law) to eliminate formalism. In our country, the value of legal practice is unquestionable even when, due to highly criticizable decisions, our Supreme Court of Justice and some lower courts have denied the effectiveness of consent, favoring instead the formalism of the rules of evidence.
Due diligence is then a necessary reality in real-estate; it may be freely agreed to by the parties. The substance (the "fond," as we say in French law) of the clause allows limiting the extent of the parties' obligations. In most sales, due diligence is not only a set of obligations, but it also includes a truly suspensive term. This may be stipulated in the contents of a letter of intent to sell or a promise of sale. In practice, the former has the same effect as the latter, but it comprises fewer elements and involves a written contract.
Our personal view is that due diligence, just as in other legislations, should be considered as a period of total freedom for the parties to rescind the sale or to include in it other elements and warranties. It is advisable to establish clearly that neither of the parties will be obligated to buy or sell until the termination of the period of due diligence. Some common due-diligence tasks are: obtaining a certification of liens and encumbrances, inspecting improvements or having them inspected by an engineer, etc.
It is appropriate to ask then whether a due-diligence clause would be annullable by the provision of the Civil Code which states that a promise of sale agreed to with or without earnest money has the same effect as a sale. Since it appears that such legal provision is not of a public-order nature, a negative answer is imperative.
