New customs 'request for assistance' regime for counterfeits now in force

Canada

Canadian developments at the close of 2014 on the anti-counterfeiting front ushered in a new customs 'request for assistance' procedure to provide for the detention of counterfeits at the Canadian border, an expanded definition for trademark infringement, and new criminal trademark and copyright sanctions.

The provisions relating to the customs 'request for assistance' procedure in Canada’s Bill C-8, the Combating Counterfeit Products Act, came into force on January 1 2015. Publication of the proclamation into force occurred only the day before, on December 31 2014. The bill itself had received Royal Assent three weeks earlier on December 9 2014, bringing the bill’s expanded definition for trademark infringement and the addition of new criminal sanctions in both the Trademarks Act and Copyright Act into force at that time.

The 'request for assistance' procedure now incorporated into both the Trademarks Act and Copyright Act allows the owner of a Canadian trademark registration or copyright to file a 'request for assistance' from customs authorities – the Canada Border Services Agency (CBSA) – to take action against counterfeit trademark goods and pirated copyright works. Under the procedure, the CBSA has the ability to detain goods or works for five days for perishable items and 10 working days for non-perishable items, and to exchange information about the items with the IP rights holder. To extend the detention period, the rights holder will need to bring a court action to enforce Bill C-8’s prohibitions on counterfeit goods bearing a registered trademark or on pirated works that infringe copyright, and to provide notice of the court action to the minister before the detention period expires.

Since a trademark registration is a condition of requesting assistance from the CBSA for trademark counterfeits, trademark owners should, if they have not already done so, review their portfolios to ensure that steps are being taken to arm themselves with registrations. Trademark owners should ensure that the list of goods covered by their trademark registrations includes goods likely to be counterfeited, and if not, should consider filing for an updated list of goods. Both trademark and copyright owners should also consider registering copyright in any works, including trademark designs, which could be subject to unauthorised copying.

The CBSA has now made available the 'request for assistance' form, and it does not appear that there will be a government fee associated with the filing of the form. Certain aspects of the procedure and form remain, however, unclear. Most importantly, the costs to be incurred by IP rights holders for the CBSA’s detention of goods under the procedure are not yet known.

As to why there is some uncertainty with the procedure, the last steps to proclamation into force were done quickly, and we note that the government’s December 31 2014 Explanatory Note attached to the proclamation into force order suggests that the January 1 2015 date was set as part of, and in order to allow Canada to implement, its border enforcement obligations within the IP chapter of the Canada-Korea Free Trade Agreement, and to allow Canada to “comply with the intellectual property enforcement obligations of current and future trade agreements”.

Provisions expanding the definition of 'infringement' in Section 20 the Trademarks Act and adding criminal provisions relating to infringement of copyright and trademark rights also came into force on December 9 2014. The new expanded definition of 'infringement' for trademarks includes infringement caused by:

  • The sale, distribution or advertisement of goods or services that are confusing with a trademark or trade name;

  • The manufacture, causing to be manufactured, possession, importation, exportation or attempt to export of goods in association with a confusing trademark or trade name, for the purposes of sale or distribution;

  • The sale, offering for sale or distribution of any label or packaging bearing a trademark or trade name that the person knows or ought to know is not associated with the goods or services of the owner of the registered trademark and such sale, distribution, or advertisement would be in association with a confusing trademark or trade name; and

  • The manufacturing, causing to be manufactured, possessing, importing, exporting or attempting to export any label or packaging bearing a trademark or trade name for the purposes of its sale, or distribution or for the purposes of the sale, distribution or advertisement of the goods and services with the trademark or trade name if the person knows or ought to know is not associated with the goods or services of the owner of the registered trademark and such sale, distribution, or advertisement would be in association with a confusing trademark or trade name.

The new criminal offences under the Trademarks Act relate to registered trademarks, incorporate the expanded 'infringement' definition and allow courts to order the destruction or disposal of infringing goods, equipment and materials upon a finding of guilt.

The expanded criminal offences under the Copyright Act include possession for sale, rental, distribution for trade, or exhibition to the public by way of trade of an infringing copy of a work, the import for sale or rental of an infringing copy of a work, and the export or attempt to export for sale or rental of an infringing copy of a work.

Penalties for criminal offences under both acts include a fine of up to C$1 million and/or up to five years in prison for an indictment, and a C$25,000 fine and/or up to six months in prison for a summary offence.

Scott MacKendrick and Tamara Winegust, Bereskin & Parr LLP, Toronto

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