Resetting the Agenda: USMCA and IP Obligations

The background: Trade agreements play a crucial role in advancing innovation, enhancing market access, and driving global economic growth. However, trade agreements are not worth the paper they’re written on if they aren’t enforced. This includes the United States-Mexico-Canada Agreement (USMCA).

As discussed in the Chamber’s International IP Index, while the Mexican government has implemented many of the provisions laid out in the USMCA, it has yet to fully implement key intellectual property (IP) commitments. These commitments are critical to ensuring Mexico and its trading partners can achieve the economic benefits made possible through trade.

What’s needed:  Four years after entry-into-force, it is critical that the Mexican government achieve the following by the USMCA’s transition deadlines:

• Implement Annex 12-F to address delays in marketing approval, which create an impediment to market access, and in turn limit patient access to new medicines;
• Introduce a regulatory data protection period of at least five years for both small molecule and biologic medicines to incentivize the development of treatments, as mandated under Article 20.48;
• Accelerate patent infringement proceedings and implement procedures necessary to provide timely and effective preliminary injunctions required under Article 20.78;
• Introduce patent term restoration to compensate for the patent term lost due to regulatory delays in approving medicines, as required under Article 20.46.2. Mexico is one of the few members of the OECD that does not provide patent term restoration; and
• Implement the patent linkage obligations in Article 20.50 and Annex 20-A to ensure patent holders receive adequate notice prior to the marketing approval of follow-on products.

Why it matters: Full implementation of USMCA’s IP commitments can enhance the ecosystem for innovation and empower Mexico to unleash the many benefits that strong IP rights provide, namely certainty in the marketplace that makes investment, research and development, and innovation more attainable. As the Chamber’s Statistical Annex shows, strong IP standards correlate to:

• Being 38% more attractive to foreign investment;
• Being 32% more likely to have private sector investment in R&D activities;
• Being 46% more likely to attract venture capital and private equity;
• Having over 5x more highly skilled researchers; and
• Being, on average, 25-40% more competitive (be it talent, digital, workforce, or innovation).

Timely implementation of USMCA obligations can ensure a more innovative future for Mexico that will boost economic growth throughout North America. As always, the Chamber and the American business community stand ready to work with the Mexican government during this transition.

About the authors

Ryan Denson

Ryan Denson is Manager for International IP for the Global Innovation Policy Center at the U.S. Chamber of Commerce.