Significant changes to Trademarks Act introduced

The Canadian government has introduced significant proposed changes to Canada’s Trademarks Act and Copyright Act through Bill C-56, which had its first legislative reading on March 1 2013. The legislation provides new mechanisms for combating counterfeit trademark and copyright goods and for registering non-traditional trademarks such as scents and holograms.

Bill C-56 seeks to add new civil and criminal remedies and new border measures in both acts, in order to strengthen the enforcement of copyright and trademark rights, and to curtail commercial activity involving infringing copies and counterfeit goods. In particular, both acts will be amended to permit border officials to detain goods suspected of infringing any trademark or copyright, and provide for related enforcement proceedings and remedies. 

In a similar vein, Bill C-56 seeks to add criminal offences and remedies to the Trademarks Act directed at counterfeits, similar to those which already exist in the Copyright Act. In this regard, offences are proposed regarding the manufacturing, sale, possession, importation, distribution of counterfeit goods, labels and packaging, with fines of up to $1 million or imprisonment for up to five years. The changes are likely to be applauded by rights holders in Canada who can experience difficulty in protecting their rights against counterfeits, particularly in the trademark area.

In addition, and building upon a Practice Notice issued in 2012 permitting the registration of sound marks, the Trademarks Act looks to be amended in a number of other respects with the clear intent of broadening the nature and scope of what can be registered as a trademark to all forms of what many refer to as non-traditional trademarks. To accomplish this goal, the amendments propose to delete the term 'mark', a term largely undefined in both the act and the jurisprudence, and replace it with the defined term 'sign', which “includes a word, a personal name, a design, a letter, a numeral, a colour, a figurative element, a three-dimensional shape, a hologram, a moving image, a mode of packaging goods, a sound, a scent, a taste, a texture and the positioning of a sign”. 

However, to build some limitations into the area, Parliament proposes to amend the definition of 'distinctive' and grant the registrar the power to reject an application on a preliminary ground of distinctiveness. Currently, the registrar does not review an application for distinctiveness, although an application can be opposed on this basis. Further, a trademark will not be registrable if its features are dictated primarily by a utilitarian function. As part of this modernisation, the concept and registration of “distinguishing guises”, currently a type of trademark directed at the shaping, wrapping and packaging of goods, will be deleted completely from the act and those types of marks will be dealt with in a like manner to other non-traditional trademarks. The totality of changes are clearly meant to create flexibility and allow for the registration of all types of non-traditional marks, but only if they are in fact distinctive.

Divisional trademark applications will also be permitted under the proposed changes, giving proposed use applicants the flexibility of registering their mark for the goods and services for which there has been use, without having to abandon the application with respect to any of the other goods and services claimed in the original application. Similarly, divisional applications will allow for the registration of a trademark for non-contentious goods and services without delay, while permitting an opposition to proceed as against any contentious goods and services contained in the original application. 

Trademark owners will no doubt closely track the progress of the amendments as they work through the legislative process.

Kelly Gill, Gowling Lafleur Henderson LLP, Toronto