The Combating Counterfeit Products Act

Last week, the Government introduced Bill C-56, Combating Counterfeit Products Act. It has two main objectives. First, to protect public safety and health by enacting legislation specifically to target commercial scale trafficking in counterfeit products. Second, to make technical amendments to the Trade-marks Act such as to permit registration of non-traditional trade-marks like sounds, and to improve registration procedures. The Government backgrounder and related FAQs, and other information is available at Industry Canada’s website.

The anti-counterfeiting portion of the legislation addresses recommendations made by the Parliamentary Standing Committee on Public Safety and National Security (May 2007) and Parliamentary Standing Committee on Industry, Science and Technology (June 2007) to crack down on commercial counterfeiting operations because of the serious health and safety consequences. Similar recommendations had been made by the Ontario Chamber of commerce, Canadian Chamber of Commerce, and the Canadian Anti-Counterfeiting Network (CACN). Canada’s trading partners including the European Union and the United States have for years been, for good reason, particularly critical of Canada’s porous borders in dealing with counterfeit goods.

The problems with counterfeiting were recently highlighted in the CBC documentary Counterfeit Culture. The CBC summarized the video as follows:

Counterfeit Culture is a one-hour documentary that explores the dangerous and sometimes deadly world of fake, fraudulent, and faux products. The imitation industry has a long history of peddled knock-off designer handbags, watches, and shoes but during the last 25 years, it has mushroomed into a global phenomenon.

The range of counterfeit goods now being produced includes pharmaceuticals, food, toys, electronic goods, car parts, and microchips. The traffic in counterfeit goods is now estimated at a staggering $700 billion representing nearly 10% of all global trade. This illicit and highly profitable criminal enterprise continues to grow unabated and has been linked to organized crime syndicates around the world.

Shot on location in Canada, the USA, Asia, and Europe, Counterfeit Culture challenges consumers to take a deeper look at what would appear to be harmless knock-offs at bargain prices. This thought-provoking film provides an insight into what is now a world-wide menace that has been called the crime of the 21st century.

The RCMP also highlighted the problems with counterfeiting in Canada in a report titled A National Intellectual Property Crime Threat Assessment, 2005 to 2008 published in September 2010, summarized here. Another recent video highlighting the problems with counterfeit goods is Condoms, Pickles and Circuit Breakers have WHAT in Common?

The anti-counterfeiting portion of the CCPA has three main sets of provisions.

By far, the most important are the provisions which establish a new border regime that will give the Canada Border Services Agency (CBSA) expanded powers of search, seizure and interception. It will create a system to allow trademark and copyright, but not patent, owners to submit a “request for assistance” to the CBSA. It will enable them to request that border officers detain commercial shipments suspected of containing counterfeit goods. This will give the owner of legitimate products an opportunity to begin court proceedings which ultimately will lead to, among other things, a court finding that the goods are counterfeit and should be destroyed, or are not counterfeit and should be released.

Many of the border provisions are based on the internationally accepted rules and measures prescribed by the World Customs Organization (WCO) Model Legislation for complying with GATT TRIPs’ border requirements.

The CCPA also creates new prohibitions against the manufacture, possession, importation or export of goods, for the purpose of sale or distribution. It also introduces new criminal offenses for commercial scale sales or distribution of counterfeit goods, labels and packaging.

The introduction of the legislation was welcomed by many organizations concerned with counterfeiting including The Canadian Chamber of Commerce, Food & Consumer Products of Canada, Electro-Federation Canada, and the Canadian Anti-Counterfeiting Network. Given the indisputable focus of the legislation on curbing commercial scale counterfeiting and its goal of protecting the health and safety of consumers and others, one would expect support for the Bill to be widespread.

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