Canada: Bill C-31 And The Proposed Trademarks Act: Is it Ultra Vires?

"Use" is one of the principal motifs of the Trade-marks Act. Almost every substantive provision of the Act refers to use. This is no mere coincidence. In Canada, trademark rights have always arisen as a result of use. Without use, there can be no goodwill, and without goodwill there can be no trademark rights. This has been the case with every federal trademark statute since the first statute was enacted in 1868. At least, that's been the case until the launch of Bill C-31.

In the recent Masterpiece decision of the Supreme Court of Canada, Justice Rothstein stated the following:

"At the outset, it is important to recall the relationship between use and registration of a trade-mark. Registration itself does not confer priority of title to a trade-mark. At common law, it was use of a trade-mark that conferred the exclusive right to the trade-mark. While the Trade-marks Act provides additional rights to a registered trade-mark holder than were available at common law, registration is only available once the right to the trade-mark has been established by use. As explained by Ritchie C.J. in Partlo v. Todd (1888), 17 S.C.R. 196, at p. 200: 

It is not the registration that makes the party proprietor of a trademark; he must be proprietor before he can register..."

That a trademark and the goodwill it represents are inextricably intertwined is likewise the foundation of U.S. trademark law. In the Boston Professional Hockey Association v. Dallas Cap & Emblem Mfg., Inc. case, the point was expressed as follows:

A trademark is a property right which is acquired by use. . . .An individual selects a word or design that might otherwise be in the public domain to represent his business or product. If that word or design comes to symbolize his product or business in the public mind, the individual acquires a property right in the mark. The acquisition of such a right through use represents the passage of a word or design out of the public domain into the protective ambits of trademark law.

Thus, in both Canada and the U.S., "use" is an essential condition for creation of enforceable trademark rights, in contrast to other countries where trademark rights are based on registration, not use. The proposed Trademarks Act of Bill C-31 undermines the foundation of Canadian trademark law by providing for the first time, the possibility for an applicant to secure a registration in Canada without having used the mark anywhere. 

The legislation if enacted invites a constitutional challenge on the authority of Parliament to legislate rights conferred by registration and not use.  In effect, this amounts to creating trademark rights "in gross". The issue, in short, is whether the proposed legislation constitutes an undue invasion of the rights of the provinces to legislate in relation to property and civil rights within the province, and therefore is ultra vires of Parliament, and whether it can be justified as "trade and commerce" given there is no trade, and no commerce at the time of creation of trademark rights "in gross". 

The authority of Parliament to legislate in relation to trademarks stems from s. 91(2) of the Constitution Act, 1867, which grants to Parliament exclusive jurisdiction in relation to trade and commerce. This jurisdiction has two branches, (1) the power over international and interprovincial trade and commerce, and (2) the power over general trade and commerce affecting Canada as a whole. The authority of Parliament to enact a national registration scheme has never successfully been challenged, but the circumstances presented by the proposed Trademarks Act are different from what has previously been considered.  

The Supreme Court of Canada dealt with the constitutional validity of the Trade-marks Act in Kirkbi AG v. Ritvik Holdings Inc.  In writing the unanimous opinion of the Court, Justice LeBel stated as follows at paragraph 31:

The scheme set out in the Trade-marks Act regulates both registered and unregistered trade-marks.  It regulates the adoption, use, transfer, and enforcement of rights in respect of all trade-marks.  If trade-marks are intended to protect the goodwill or reputation associated with a particular business and to prevent confusion in the marketplace, then a comprehensive scheme dealing with both registered and unregistered trade-marks is necessary to ensure adequate protection.  The inclusion of unregistered trade-marks in the regulatory scheme is necessary to ensure the protection of all trade-marks.  The Trade-marks Act is more than simply a system of registration. (emphasis added)

Isn't the proposed Trademarks Act simply a system of registration, in conferring rights based on registration and not on use? It is submitted that the proposed Trademarks Act would unduly encroach on property and civil rights within a province by granting rights to a trademark "in gross", without any requirement for use anywhere.  

Consider what might occur where a registration is issued absent use anywhere, and is immune from cancellation for non-use for a period of three years from the date of the registration. After the registration has issued, someone else commences use of a confusing trademark or trade name in a province without knowledge of the issuance of the registration, and without any evidence of bad faith. Such use, although valid at common law, would constitute trademark infringement and thus make the user liable to an injunction even though the registered mark has not been used anywhere. Thus, even if it were the case that creating a statutory trademark right "in gross" somehow is a valid exercise of federal power, given the Canadian constitution it is hard to see how such a statutory trademark right, absent use anywhere, would not intrude unduly on property and civil rights within the province.

The trademark legislation proposed in Bill C-31 thus threatens to abandon more than 140 years of trademark jurisprudence as well as inviting a risk to constitutional challenge. The potential for chaos that would result if the Bill becomes law could be avoided if the government steps back and reconsiders whether use should remain a requirement for registration. 

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.