Draft bill proposes important amendments to Criminal Code

The Ministry of Justice has issued a draft bill to amend the Criminal Code. The draft is currently being analysed by the Council of the State before going through Parliament. In its current form, it includes a set of reforms that will affect crimes against industrial and intellectual property both directly and indirectly.

This update highlights the proposed changes that will - should they go ahead - have an impact on IP crimes.

First, new behaviours will be criminalised. The following are expressly deemed to be a crime:

• facilitating illegal access to works protected by copyright;
• promoting or facilitating the distribution, marketing, reproduction, plagiarism, access to, or public display of, works protected by copyright, and deleting, modifying or circumventing, or facilitating the circumvention of, the technological measures used to prevent such behaviour;
• establishing links on the Internet which facilitate the active and systematic location of copyrighted works offered online illegally - in particular, providing organised and classified listings of links; and  
• providing services or developing activities that incorporate a sign identical, or confusingly similar to, a registered trademark.

Second, the draft bill consolidates a staggered system of criminal liability depending on the seriousness of the conduct, which was initiated following the 2010 reform of the Criminal Code. The aim is to match the criminal response with the gravity of the offence committed; this involves differentiating between several offences, which means that the criminal provisions that regulated them must undergo a major reform.

With regard to trademark infringement (the reform does not affect patents, utility models, designs or topographies of semiconductor products), there is a distinction between the following offences:

1. the manufacture, production, importation, wholesale offer, wholesale distribution, wholesale marketing and storage of infringing goods;
2. the retail offer, retail distribution and retail marketing of infringing goods, as well as the provision of services or development of activities that incorporate a sign identical or confusingly similar to a registered trademark; and
3. the occasional or street vending of infringing goods.

With regard to copyright infringement, there is a distinction between the following offences:

1. the wholesale distribution, wholesale marketing, wholesale import, wholesale export, wholesale storage of infringing goods, as well as the promotion or facilitation of these behaviours, by eliminating, modifying or circumventing, or facilitating the circumvention of, the technological measures used to prevent such behaviours;
2. the reproduction, plagiarism, retail distribution, retail marketing, public display, retail import, retail export, retail storage of infringing goods, the facilitation of access to these goods, as well as the promotion or facilitation of these behaviours, by eliminating, modifying or circumventing, or facilitating the circumvention of, the technological measure used to prevent them; and
3. the occasional or street vending of infringing goods.

Third, the draft bill imposes stricter penalties overall:

• The penalty for the offences listed on points (1) above, which is currently six months to two years’ imprisonment, will increase to one to four years’ imprisonment.
• The penalty for the offences listed on points (2) above, which is currently a fine equivalent to three to six months (ie, the infringer must pay a certain sum of money every day for the duration of the term) or community service, will increase to six months to three years’ imprisonment.
• The penalty for the offences listed on points (3) above, which is currently a fine equivalent to three to six months or community service, will increase to six months to two years’ imprisonment. However, with regard to occasional or street vending, the judge will be allowed to impose a fine equivalent to one to six months or community service (instead of a penalty of six months to two years’ imprisonment) if this is considered appropriate, bearing in mind the characteristics of the infringer and the small amount of the profit, either potential or obtained (as long as none of the aggravating circumstances set out in the Criminal Code applies - ie, the profit obtained is economically significant, major damage has been caused, the infringer belongs to an organisation designed to infringe IP rights or the infringement involved children under the age of 18).
• The penalty for the infringement of plant variety protection, which is currently six months to two years’ imprisonment, will increase to one to three years’ imprisonment.
• The penalty for the manufacturing, import, circulation or possession of means to facilitate the removal or neutralisation of technical devices used to protect computer programs or any copyright protected work, which is currently six months to two years’ imprisonment, will increase to six months to three years’ imprisonment.
• Stricter penalties will apply with regard to trademark and copyright infringement: the penalty of one to four years’ imprisonment will increase to two to six years’ imprisonment, and the fine equivalent to 12 to 24 months will increase to 18 to 36 months.

The following changes are also noteworthy:

• The subjective element of ‘animus lucrandi’ (ie, the intention to make a gain) with regard to crimes against intellectual property will be replaced with the more general concept of ‘direct or indirect profit’.
• The concept of ‘obtained profit’ will be broadened with the addition of the phrase “or the profit that could have been obtained” as a benchmark to determine the starting point in certain cases.
• The concept of ‘misdemeanour’ will be removed. Some misdemeanours remain in the Criminal Code as ‘minor crimes’.
• It will be possible to seize goods and effects belonging to a person convicted of certain offences (including IP offences) when the judge considers that there is sufficient evidence to suspect that such goods or effects originate from criminal activities similar to those for which that person has been convicted.
• There will be technical improvements to the regulation of corporate criminal liability: the meaning of ‘adequate control’ - which triggers criminal liability - will be defined, and criminal liability will depend on the size of the corporation.
• The regulation of continuing offences and the parole system will be revised.
• The regulation of the suspension and substitution of prison penalties will be modified.
• The same value will be given to convictions obtained in the courts of other EU member states as those obtained in the Spanish courts, and the Spanish decisions will be sent to the courts of other EU member states when relevant.

Jordi Camó, Grau & Angulo, Barcelona