“Canada is not open to your kind of business.” This
is Canada’s message to criminals engaging in counterfeiting
and piracy with its Combating Counterfeit Products Act
(known as Bill C-8), which received Royal Assent on Dec. 9, 2014.
Industry Minister James Moore has stated that this Act will
“give rights holders, border service officers and law
enforcement officers the tools that they need to work together to
directly confront the growing threat of international
counterfeiting and piracy.”
The Act creates new civil causes of action with respect to
sustaining commercial activities in infringing copies and
counterfeit trademarked goods, as well as new criminal offences for
trademark counterfeiting which bring them in line with existing
offences in the Copyright Act. This is undoubtedly helpful
to brand owners whose logos are not the subject of copyright
protection. The Act also creates new criminal offences prohibiting
the possession or exporting of infringing copies or counterfeit
trademarked goods, packaging or labels. The latter offence aims to
capture those who import packaging and labels separately from goods
themselves, only to assemble them in Canada for re-sale.
The signature change is the new border enforcement regime
enabling customs officials to detain goods that they suspect
infringe copyright or trademark rights, and allowing them to share
information relating to the detained goods with rights owners who
have filed a request for assistance, so that they may have a
reasonable opportunity to pursue a remedy in court.
There is no border mechanism under the current system, nor can
information on suspicious shipments be shared with brand owners.
Currently, the Canadian Border Services Agency (CBSA) has no
authority to detain suspected counterfeit goods, or disclose
shipping information. CBSA will now have the authority to
temporarily detain goods suspected of being counterfeit, and set in
motion criminal (RCMP) and administrative (Health Canada)
investigations. CBSA will also have the authority to refer to a matter to a
rights holder for the pursuit of civil remedies.
The Act targets commercial grade counterfeiting aimed for the
Canadian market: goods in transit, parallel imports and goods
imported by an individual for personal use are all exempt from the
application of the border measures.
It is also notable that the Act allows police to seek authority
for a wiretap for offences under the Copyright Act and the
Trademarks Act. It remains to be seen how these measures
will be treated by the courts.
The Act is a welcome acknowledgement of long-standing
concerns over the growth of counterfeit business in Canada, which
the Royal Canadian Mounted Police (RCMP) estimates has increased by
400% within the last seven years alone. Counterfeit products
now permeate a broad variety of industries, raising concerns for
health and safety and threatening legitimate business
While the Act is being welcomed by many as ushering in a new era
of enforcement and being a step in the right direction, it also has
its critics. In particular, some changes have been met with
general approval, such as strengthening the civil and criminal
enforcement provisions of the Trade-marks Act. Other
changes suggested by stakeholders but ultimately rejected had
included adding statutory damages to the Trade-marks Act,
and not exempting goods in transit. Troubling to many is that the
provisions of the Act do not permit the seizure and destruction of
counterfeit merchandise where the importer does not respond to a
rights holder’s Request for Assistance. Other concerns
include allocation of insufficient resources to law enforcement
agencies and CBSA.
In responding to criticism, the government has stated that it
aims to balance competing interests with safeguards, for example by
allowing only temporary detention of goods to preserve the
presumption of innocence. CBSA has no ability to make a decision as
to infringement, and damages are awarded via the court system,
without the mechanism of statutory damages. In this way, the Act
aims to balance pursuing the abuses of criminals and due
Implementation is expected to be swift, and possibly as soon as
early 2015. Much uncertainty remains as to how the gritty details
of enforcement will play out. In short, we are about to enter
an interesting time in Canada in respect of counterfeiting
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