By: Jaime Mantilla Compte 
As part of the rights guaranteed by the Ecuadorian Intellectual Property Law to trademark owners in our country, there is the possibility of taking action against the names of companies or partnerships that include a registered trademark, even though they were approved by the competent Authorities.
Accordingly, article 293 of the mentioned Law establishes:
“Art. 293.- A trademark, commercial name or plan variety owner who determines that the Superintendence of Companies or Banks has approved the adoption by companies under its control of a name including identical signs as those of its trademarks, commercial names or plant varieties, may request the EIPI the suspension of the use of the above name to eliminate all risk of confusion or undue usage of the protected sign.
The EIPI will notify the parties and to Superintendence of Companies or Banks through a resolution; the company will have a term of ninety days starting at the date of notice of the EIPI resolution, to adopt another name; a term which may be extendable for only one time and for the same time by means of justifiable causes.
In the event that a new name is not adopted within the term set forth in the above paragraph, the Superintendence shall proceed to dissolve or liquidate the company.”
Despite the above strengthens protection for trademark owners and establishes a clear procedure to claim their rights, having to exercise them due to the lack of anticipation and care of the Authorities implicates many times incurring in high expenses that would not be necessary if there would be a coordination between the Ecuadorian Intellectual Property Institute (EIPI) and the other entities in charge of approving the names of companies or partnerships.
In our opinion, an effective way to avoid this “incompatibility” between trademarks and names of companies would be the elaboration of a directive that establishes as mandatory for the corresponding Superintendence (of Companies, of Banks and of Popular and Solidarity Economy), to verify the information at EIPI regarding registered trademarks or trade names, prior to approving a company’s name.
In this manner, a preventive review would be made which would allow reducing the number of cases in which names of companies or partnerships improperly include previously registered trademarks and will reduce the amount of litigations that arise for this reason, that affect intellectual property owners.
The way to implement this can change, according to the best manner in which the needs of the Authorities and the users can be adapted. An alternative could be that the review is made directly by the corresponding Superintendence by accessing the EIPI’s database or, by the other hand, that it is established as a requirement for he interested party to file the trademark search report from EIPI along with the name reservation of the company or partnership, in order to determine that such name does not affect preexisting intellectual property rights.
In accordance with the above and going beyond companies’ names, we consider relevant to mention in this article the problems that have also been generated in practice by the “trade names approved” by the Internal Revenue Service (IRS).
What is currently occurring is that the IRS when opening or updating a Contributor’s Sole Registration (RUC for it meaning in Spanish), include the possibility for the user to provide a “trade name” with which the business will operate, despite that the Law for the Contributor’s Sole Registration nor its Directive establishes this field as part of the required information for registration.
This situation has generated constant problems for trademark owners, since the IRS does not review if the “trade name” the user is providing affects or not rights of third parties.
The above mentioned causes that in many cases, when the legitimate owner of a registered trademark takes action against the improper use of its mark, an unfavorable response from the offender is received, because he believes to be endorsed by the “trade name” that appears in the Contributor’s Sole Registration (RUC).
Cases like this have affected constantly the renowned restaurant LA CHOZA from Quito (http://www.lachoza.com.ec/), with whom a more conciliatory strategy has been chosen, avoiding legal action and sending instead cease & desist letters informing the offender of the legal situation.
So, through dialog and negotiation, favorable results have been obtained regarding the cease of improper use of this famous trademark, avoiding the discomfort and elevated costs of litigation.
Nonetheless, again this behavior of the IRS causes the trademark owner to be bound to incur in unnecessary expenses when such entity should not include in the Contributor’s Sole Registration (RUC) the declaration of a “trade name”.
Therefore, our opinion is that the IRS should eliminate the possibility of indicating a “trade name” in the Contributor’s Sole Registration (RUC) or, if it insists on keeping it, making a prior search in the EIPI’s database ex officio or as a requirement to the interested party, so that it can confirm that no intellectual property rights of third parties are affected.
 Lawyer of the “Pontificia Universidad Católica del Ecuador” (2007) and participant of the Intensive Postgraduate Course on Copyrights at “Universidad de Buenos Aires”, Argentina (2008). Senior Associate at Falconi Puig Abogados.