Canada: Implications Of The TPP In Canada

Last Updated: December 3 2015
Article by Simmi Mangat

On 5 October 2015, after five years of negotiations, Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States, and Vietnam, entered into a landmark trade agreement known as the Trans-Pacific Partnership (TPP). This agreement covers 40 per cent of the global GDP. A month later, the full text was published by both the New Zealand and US governments. Chapter 18 of the TPP text broadly discusses various IP rights and matters such as traditional knowledge, copyright, patents, software, cybersquatting, geographical indications and trade marks, even going as far as to specifically encourage member countries to allow registration of scent marks. 

For the Canadian IP system, two of the key issues of this chapter have to do with pharmaceutical patents and copyright.

With respect to pharmaceutical patents, according to Articles 18.46 to 18.48, 18.50 and 18.51, each party of the TPP shall make available an adjustment of the patent term to compensate the patent owner for unreasonable curtailment of the effective patent term as a result of the prosecution process and the first marketer due to delays in the marketing approval process. Article 18.50 of the TPP provides new drug manufacturers with at least a five-year market exclusivity period. With respect to biologics, Article 18.52 of the TPP provides at least an eight-year market exclusivity period or at least five years plus additional market-specific measures.

With respect to copyright, Article 18.63 of the TPP provides a minimum copyright protection term of the life of the author plus 70 years and 70 years from the first authorised publication of corporate works. Furthermore, Article 18.69 of the TPP provides for criminal procedures and penalties for copyright violations.

Article 18.74(3) of the TPP text provides the infringer to pay the right holder damages adequate to compensate for the injury the right holder has suffered because of an infringement of their intellectual property. Under Articles 18.74(4) and (6), judicial authorities can consider any legitimate value the right holder submits including pre-established damages and additional damages. Furthermore, Article 18.74(12) provides that material and implements that have been used in the manufacture or creation of and infringing product be destroyed or disposed of so as to minimize the risks of further infringement.

To assist with copyright enforcement, Article 18.82 of the TPP ensures that legal remedies are available for rights holders to address copyright infringement which include legal incentives for Internet service providers (ISPs) to cooperate with copyright owners to deter the unauthorized storage and transmission of copyrighted materials. Article 18.82(3)(a) provides a requirement for ISPs to remove or disable access to material on their networks upon obtaining knowledge of infringement. This provision is similar to the "notice-and-takedown" system of the Digital Millennium Copyright Act in the USA.

Canada had already negotiated a patent term extension capped at two years in a proposed trade agreement with the European Union (CETA). At present, however, Canada is the only G7 country that does not offer patent term extensions. Furthermore, Canada presently allows the manufacturer of an innovative drug a period of eight years of market exclusivity. The bigger impact will be seen more with respect to copyright provisions. At present, Canada currently has a copyright term of life of the author plus 50 years. Penalties under Canada's present Copyright Modernization Act are only up to CA$5,000 for non-commercial infringement. Furthermore, Canada has a "notice-and-notice" system where, at most, an ISP may be required to forward a notice of alleged infringement from a rights-holder to a subscriber who is allegedly hosting or sharing infringing material.

While the TPP has been signed, it has yet to be ratified by the governments of the TPP parties. The Canadian IP community will be closely monitoring the ratification process as it proceeds in Canada.

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.

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