ECUADOR: An Introduction to Intellectual Property

A 2024 Perspective

As Ecuador continues to modify its economy through modern methods, the significance of intellectual property (IP) has become more relevant. The country’s legal landscape is shaped by global trade agreements, domestic legislation, and political changes. However, in 2024, IP remains a critical area for businesses operating in the country, due the practical complications related to enforcement in certain matters.

Ecuador has seen a gradual recovery from the economic challenges caused by the global pandemic. With a government that has recently focused on economic diversification and foreign investment, sectors such as technology, pharmaceuticals, and the creative industries, are expanding rapidly. This shift also brings IP into the spotlight, as companies and entrepreneurs recognise the need to protect their innovations, trade marks, and creative works.

In addition, the country’s strategic participation in global markets, especially through trade agreements like the Ecuador-European Union Free Trade Agreement (FTA), has brought IP compliance to the forefront. Ecuador must align its IP laws with international standards, making the IP landscape more favourable for businesses but also increasing the complexity for compliance.

Several legislative measures introduced in recent years have reshaped Ecuador's IP framework. One of the most significant reforms has been the implementation of the Organic Code on the Social Economy of Knowledge, Creativity, and Innovation (known as the “Ingenios Code”), which remains a foundational statute governing IP. This law has been instrumental in promoting innovation, protecting traditional knowledge, and facilitating technology transfer; however, several amendments have been proposed to such regulations in order to harmonise IP rights with international treaties, including the TRIPS Agreement (Trade-Related Aspects of Intellectual Property Rights). These amendments aim to improve enforcement mechanisms, reduce bureaucratic hurdles, and simplify procedures for registering patents, trade marks, and copyrights. For businesses, this is a welcome development, as it provides clearer pathways for IP protection.

In addition, the Intellectual Property Office (SENADI) has been actively promoting awareness of IP issues, providing training programmes for businesses, and simplifying processes for IP registration. This has led to a noticeable increase in trade mark filings, patent applications, and copyright registrations over the past two years, reflecting a growing recognition of IP’s importance in a competitive market.

Current IP Challenges

Rise in trade mark and patent filings

With the expansion of various sectors like technology, pharmaceuticals, and agro-industry, there has been an increase in patent and trade mark applications. Ecuadorian businesses are now more aware of the strategic value of protecting their trade marks and innovations, especially as they aim to expand into international markets. However, foreign companies operating in Ecuador must navigate a registration process that can still be slow, despite recent improvements.

Counterfeit goods and IP enforcement

One of the persistent challenges in Ecuador is the prevalence of counterfeit goods, especially in sectors like fashion, electronics, and pharmaceuticals. The government has made strides in combating IP infringement, but enforcement remains inconsistent in some areas. One of the main challenges is the co-ordination that is required between the Customs Authority and the Intellectual Property Office in order to take border measures in order to avoid the entry into the country of counterfeit goods. SENADI has been working with local law enforcement to increase the seizure of counterfeit goods and raise public awareness about the dangers of IP violations.

IP in the digital era

As Ecuador’s digital economy grows, businesses face new challenges in protecting their IP in online spaces. Digital platforms have made it easier for counterfeit goods to be distributed, while social media has become a double-edged sword for trade mark protection. Companies need to be vigilant in monitoring online IP infringements, and many are turning to digital rights management (DRM) tools to safeguard their creative works and trade marks in the digital landscape. Recently, a secondary regulation has been issued in order to establish several measures to suspend webpages that could infringe intellectual property rights.

Traditional knowledge and biodiversity (Denominación de Orígen y Obtención Vegetal)

Ecuador’s rich biodiversity and the importance of indigenous knowledge have prompted significant discussions about IP protections in these areas. Under the Ingenios Code, the country has developed specific provisions to protect traditional knowledge and prevent biopiracy. While these measures are crucial for preserving Ecuador’s cultural and natural heritage, businesses that operate in sectors related to biotechnology, agriculture, or pharmaceuticals must be cautious about complying with these regulations.

Opportunities for Clients

Despite the challenges, there are many opportunities for businesses operating in Ecuador’s IP landscape.

• • IP as a business asset – increasingly, IP is seen not only as a legal necessity but as a core business asset. Trade marks, patents, and copyrights are being leveraged to secure investments, attract partnerships, and build trade mark value. Companies that strategically manage their IP portfolios will have a competitive edge in both domestic and international markets.
  • Simplified registration procedures – SENADI has streamlined various IP registration procedures, reducing wait times and increasing efficiency. This makes it easier for businesses to secure IP rights and focus on innovation and growth. Companies should take advantage of these simplified processes to ensure their IP is protected before entering competitive markets.
  • Government incentives for innovation – the Ecuadorian government has introduced several incentives for research and development, particularly in the fields of technology and biotechnology. These initiatives, which include tax benefits and grants, are encouraging businesses to invest in innovation, which in turn will lead to more IP creation. Companies in these sectors should consider partnering with local firms to access these benefits and capitalise on the growing emphasis on innovation.

Considering upcoming elections in 2025, and the possibility of a new government, next year will be crucial for investment development, and as a result, adequate IP development. Current structures should be engaged properly in order for the country to be an attractive site for investors, entrepreneurs and business developers in general.