Combating Counterfeit Products Act

An Act to amend the Copyright Act and the Trade-marks Act and to make consequential amendments to other Acts

This bill was last introduced in the 41st Parliament, 1st Session, which ended in September 2013.

Sponsor

Christian Paradis  Conservative

Status

In committee (House), as of June 12, 2013
(This bill did not become law.)

Summary

This is from the published bill. The Library of Parliament often publishes better independent summaries.

This enactment amends the Copyright Act and the Trade-marks Act to add new civil and criminal remedies and new border measures in both Acts, in order to strengthen the enforcement of copyright and trade-mark rights and to curtail commercial activity involving infringing copies and counterfeit trade-marked goods. More specifically, the enactment

(a) creates new civil causes of action with respect to activities that sustain commercial activity in infringing copies and counterfeit trade-marked goods;

(b) creates new criminal offences for trade-mark counterfeiting that are analogous to existing offences in the Copyright Act;

(c) creates new criminal offences prohibiting the possession or export of infringing copies or counterfeit trade-marked goods, packaging or labels;

(d) enacts new border enforcement measures enabling customs officers to detain goods that they suspect infringe copyright or trade-mark rights and allowing them to share information relating to the detained goods with rights owners who have filed a request for assistance, in order to give the rights owners a reasonable opportunity to pursue a remedy in court;

(e) exempts the importation and exportation of copies and goods by an individual for their personal use from the application of the border measures; and

(f) adds the offences set out in the Copyright Act and the Trade-marks Act to the list of offences set out in the Criminal Code for the investigation of which police may seek judicial authorization to use a wiretap.

The enactment also amends the Trade-marks Act to, among other things, expand the scope of what can be registered as a trade-mark, allow the Registrar of Trade-marks to correct errors that appear in the trade-mark register, and streamline and modernize the trade-mark application and opposition process.

Elsewhere

All sorts of information on this bill is available at LEGISinfo, provided by the Library of Parliament. You can also read the full text of the bill.

Votes

June 12, 2013 Passed That, in relation to Bill C-56, An Act to amend the Copyright Act and the Trade-marks Act and to make consequential amendments to other Acts, not more than one further sitting day shall be allotted to the consideration at second reading stage of the Bill; and that, 15 minutes before the expiry of the time provided for Government Orders on the day allotted to the consideration at second reading stage of the said Bill, any proceedings before the House shall be interrupted, if required for the purpose of this Order, and, in turn, every question necessary for the disposal of the said stage of the Bill shall be put forthwith and successively, without further debate or amendment.

Combating Counterfeit Products ActGovernment Orders

June 13th, 2013 / 12:20 a.m.
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NDP

Carol Hughes NDP Algoma—Manitoulin—Kapuskasing, ON

Mr. Speaker, I greatly appreciate the speech of my colleague. Certainly, it is security that we need to worry about.

My question is particular to the fact that the OECD has made it very clear that there is a need for better data when it comes to counterfeiting. Both under the Liberals and the Conservatives, there has been a big gap.

With respect to this legislation, perhaps my colleague would tell me what the government's plan is with respect to collecting better data and the proposed plan as to how it will actually do this.

Combating Counterfeit Products ActGovernment Orders

June 13th, 2013 / 12:20 a.m.
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Conservative

Mike Allen Conservative Tobique—Mactaquac, NB

Mr. Speaker, there will be details ironed out in this. However, with the new trademark process, it will make it much easier for companies. The bill would streamline the process for the application of these trademarks and patents, which would make it better for business as well.

The unknown question might be the level of counterfeit that will hit the borders. It is a good question. It is hard to tell what types of shipments and that type of thing will hit the border, what level of information that will be required and how much would CBSA have to do.

Relative to the U.S., Canada is a smaller market, so the U.S. obviously has bigger challenges. Those will be the things that we will have to ensure, that CBSA keeps its commitment that it will put the teeth into the bill and that it will be prepared to carry it through.

Combating Counterfeit Products ActGovernment Orders

June 13th, 2013 / 12:25 a.m.
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NDP

Hélène LeBlanc NDP LaSalle—Émard, QC

Mr. Speaker, I thank the member for Tobique—Mactaquac for his comments. I wanted to say his riding name, which I think is very interesting.

The member gave us a lot to think about in committee, as did his Conservative Party colleagues.

How many committee meetings does the member think it will take to address the points he and other committees raised? I think it will take at least three or four, if not more.

Combating Counterfeit Products ActGovernment Orders

June 13th, 2013 / 12:25 a.m.
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Conservative

Mike Allen Conservative Tobique—Mactaquac, NB

Mr. Speaker, that is a good question. As the member would know, and I would be the first to say, the committees are the masters of their own destiny. I can speak to the committees that I am on, and we work fairly well with the opposition in trying to get things done, most of the time.

From my standpoint, the desire for this bill has existed for quite some time. There have been a number of things embedded in it from previous reports and committee reports. They are now in this bill. We have achieved a lot of things. With regard to a number of the questions I have heard tonight from the member for Halifax West and others, questions with respect to the cost, it is already in the bill. Therefore, some of the things that individuals were talking about needing to be amended I do not think need to be amended.

As for the protracted discussion on the costing and the idea that we should put another $140 million back into CBSA, that is not the right answer. It is a matter that CBSA is committed to carrying this out within its existing mandate. I am not going to argue about the numbers, but net there are more border services officers than there were in 2006, and they have more tools. They are using tools like e-manifest and other things for bills of lading and those types of things that go through borders now, which make their process much more efficient. Simply because there are new processes does not mean there must be new money and new people.

Combating Counterfeit Products ActGovernment Orders

June 13th, 2013 / 12:25 a.m.
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NDP

Alexandre Boulerice NDP Rosemont—La Petite-Patrie, QC

Mr. Speaker, I can barely contain my emotions as I rise in the House because I know that the entire nation is hanging on my every word as I weigh in on this important debate.

I would like to begin by quoting a 13th century French poet named Rutebeuf. Some 700 years ago, Rutebeuf wrote:

What has become of the friends
Whom I held so dear
And loved so much

One could paraphrase his words today:

What has become of the principles
That I praised so highly
And boasted of so much

I am, of course, talking about the Conservative Party and the bitter disappointment it has inspired among its supporters.

For years, while it was in opposition, this government said that it would clean up Ottawa, bring change and act according to the following principles: integrity, transparency, freedom of expression and enabling parliamentarians to do their work.

What has happened since the beginning of the Conservatives' majority mandate? Parliamentarians are being prevented from talking, debating issues and making suggestions. The government is imposing time allocation. It is forcing committees to work behind closed doors. It is doing exactly the opposite of what it promised Canadians.

It is good that we are debating Bill C-56, An Act to amend the Copyright Act and the Trade-marks Act and to make consequential amendments to other Acts, the Combating Counterfeit Products Act today. What we are seeing is counterfeit debates. Democratic freedom is being undermined and parliamentarians are being prevented from doing their work.

With this bill, that makes 47 gag orders. Forty-seven motions to limit members' speaking time on government bills. This evening, the leader of the Government in the House of Commons came to announce another gag order. A 48th gag order is coming.

I think that the Conservatives are aiming for 50 before the session ends. They must want to end on a round number or something like that. It must be as simple as that.

However, these are the same Conservatives who would tear their hair out and shout whenever the Liberals dared impose time allocation after weeks of debate. Once in power, these same Conservatives today put their principles behind them and can impose time allocation after an hour or two of debate by saying that it is a matter of urgency and that the bill absolutely must be passed because it is of vital importance.

In the meantime, they tell reporters that the NDP should give consent to adjourn Parliament and go home. It is one or the other: they cannot have their cake and eat it too. They cannot say that a bill urgently needs to be passed and then complain that the NDP is keeping them in Parliament and forcing them to work and answer their questions.

Let me come back to the bill. I come from a family that is well-rooted in the cultural community. My father is a writer and my brother is a musician, so copyright is very important to me. I know that this bill is about more than just copyright as it relates to artists, but it can have consequences for that.

It is important because copyright and intellectual property are related. These are fundamental to respecting creators and people who develop products, whether we are talking about cultural products, merchandise or high-technology products. This evening we talked about pharmaceutical companies and many other things.

This debate is important to the NDP. We believe that this bill is headed in the right direction. However, members will understand that I will probably raise a concern in a few minutes. The Conservatives often do not walk the talk, as people used to say when I was young. However, this bill does have good intentions.

We have to recognize the importance of innovation in economic development and the fact that the creators of these innovations are entitled to the resulting profits. We must not allow third parties to copy what they have developed, built or imagined and abscond with the fruits of their labour.

That is outright theft of the revenues generated after a product, good, idea or concept is created and developed. It is rather difficult to know what happens surreptitiously, under the table. There are estimates but, in this case, we only have the value of seizures of counterfeit goods by the RCMP. It says that seizures increased from $7.6 million in 2005 to $38 million in 2012. That is significant.

As my colleague pointed out earlier, it is probably just the tip of the iceberg. That is just what was seized. There must be a lot of counterfeit goods in the world.

I think that if we have an opportunity to travel around the world, we will see all these young people in tourist areas who sell brand name watches that are fakes. This is just one of many examples of what we can see when we travel around the world.

In 2009, the OECD estimated that the international trade in counterfeit and pirated goods could be valued at up to $250 billion. I think it is worth studying this issue and doing what is necessary to solve the problem.

Bill C-56 is a step in the right direction but the official opposition would be much happier if we had the resources to serve our ambitions. We are not just talking about the loss of money but a risk to Canadians and Quebeckers. We learned from the testimony of several witnesses that counterfeit goods often pose a risk to the health and safety of consumers.

We heard this evening about counterfeit electrical components that can be dangerous and can cause short-circuits, as well as about poor quality counterfeit winter jackets or vests with unsanitary stuffing that do not do the job. Counterfeiting is of even greater concern to us when it has an impact on the health and safety of our constituents.

However, I must admit that I am sad and disappointed. This bill is so important for Canadian companies and consumers that we would like the Conservative government to allocate the resources needed to enforce it. For the time being, we still do not know where the funding for the enforcement regime set out in Bill C-56 will come from. That is not just a minor detail.

This bill imposes significant new duties on Canada Border Services Agency officers at a time when budgets are being cut. That is where the Conservatives' true colours shine through because we know full well that they are imposing an additional burden, additional standards and additional rules on the CBSA. They are proposing measures and then turning around and cutting $143 million from the CBSA'S budget. The Conservatives are giving the CBSA more work to do and telling them that the work needs to be done, but then they are not giving them the resources they need to do that work.

According to the Canada Border Services Agency's report on plans and priorities, 549 full-time jobs will be cut by 2015. Of course, some of those jobs will be border officer positions. The CBSA will therefore have fewer financial resources, more work to do and fewer employees to do it.

What we heard the immigration minister say this evening was wonderful. Every time we try to show the practical implications of the Conservative government's blind cuts to public services, the Conservatives tell us that our figures are inaccurate and that they are going to give us the facts.

What is funny is that last year they announced $4 billion in cuts to services for Canadians. They said they would cut the cost of bureaucracy, red tape and photocopies, but that this would not affect services for Canadians. They said they would cut 19,600 positions, but that this would not make a difference or have any impact.

In its report on plans and priorities, the Canada Border Services Agency itself says that 549 jobs are going to disappear, yet the Conservatives say no, that is not true. That happens every time we provide an example. According to the Minister of Immigration, the real numbers show that the budget is going to increase by 27%. He needs to talk to the President of the Treasury Board.

When the President of the Treasury Board announced his budget reduction plan, he said that there would be cuts of 5% to 10% across the board, that no one would escape. However, every time we mention job cuts and the impact on services, the government says that it is not a question of cuts, that there will actually be an increase in funding. There will be more border services officers and the budget will increase.

If every budget cut has turned into an increase, I want to talk to the Minister of Finance. How will he get rid of the deficit in time for the next election in 2015?

The government cannot talk out of both sides of its mouth. It cannot say that it will increase resources for the Canadian Food Inspection Agency, for example, and then put it on the chopping block, as it has done with every other government agency and department.

Last year, I found the first few pages of the budget to be fascinating. They contained an additional $51 million allocation to the Canadian Food Inspection Agency. In subsequent pages, where the bad news is usually found, the government's three-year budget reduction plan reduced the agency's budget by $56 million. I went to see a finance department official to ask whether the $51-million allocation or the $56-million reduction was right. He told me that both were right and that they would result in an overall reduction of $5 million.

The Conservatives obviously do not like to adjust the good news figures they want us to believe to reflect the reality of the cuts being made. We are seeing that, in several departments and in organizations such as Service Canada and other agencies, the Conservatives' budget cuts hurt.

This bill has good intentions, but in practical terms, on the ground, it will reduce services for Canadians. As the Conservative member who spoke before me said, if the government does not give teeth and real resources to this bill, border officers will have to be bold and do the work that the government does not dare do, without the resources that the government does not dare give them. This will be an additional burden on border officers.

That is a concern of ours. Once Bill C-56 is passed, customs officers would be asked to make highly complicated assessments on whether goods entering or exiting the country infringe on any copyright or trademark rights. Such an assessment for pirated copies would include, for example, consideration of whether any of the exceptions under the Copyright Act would apply to a product such as the CD or DVD that the officer is looking at. That is something with which the courts often struggle. We would be asking border officers to do sensitive, detailed work without providing them with enough employees, training or resources to do the job. That is worrisome.

Would traffic at our border crossings into the United States be slowed down? Would that mean that people will have to wait even longer because the border officer has to check the contents of a truck filled with boxes and ensure that those are not contraband or counterfeit goods? In addition, although there used to be two of them to do the job, now there is just one officer. That will increase the burden on border officers, make their task harder and increase their workload, and that is what concerns us.

I would like to talk about the lack of respect the Conservative government has for border officers. The Canada Border Services Agency is in the process of negotiations, and yet, for the first time in the history of Canada's public services, the Conservative government will try to impose a collective agreement based on recommendations published by the public interest commission on June 5.

Once again, the government is not showing respect for free collective bargaining. It wants to increase their workload. It is not even honouring their ability to freely negotiate their contract and collective agreement. Furthermore, the government wants to impose a new contract that would contain salary increases that are lower than what other public servants have obtained or are obtaining.

I want to put this in perspective, because it is absolutely one of the consequences of the Conservatives' attitude towards workers. I wanted to take this opportunity to talk about the government's lack of respect for the border officers in how it is handling the renewal of their collective agreement.

I also want to remind members of the Conservatives' attitude towards intellectual property. Earlier this evening, my colleague from Timmins—James Bay said that the assistant to the minister who is now the President of the Treasury Board went to Ottawa to ask that Canada be put on the 301 watch list because of its poor record on protecting intellectual property laws. This list includes countries that are as effective as Yemen and North Korea at protecting intellectual property.

By the Conservatives' twisted logic, being on the black list, being one of the bad guys, being among the world's worst offenders when it comes to protecting intellectual property rights, would actually give us an incentive to enact appropriate legislation. As if we need the whole world to see us as incompetent, unable to protect our own creations, our own inventions, our own innovations. As if we need to be compared to Yemen or North Korea before we can take action.

The funny thing is that, after the President of the Treasury Board's top official intervened, it worked. A few weeks later, Canada was on the list. Everyone here should be ashamed of the fact that our country is on the same list as countries that care so little about such critically important issues as copyright and protecting intellectual property.

I know it is late, but I would like to thank all of my colleagues for their speeches this evening. They were all excellent, and so were the questions. I would also like to thank all of the people who work behind the scenes, people who work for the caucus and the leader's office and who are here to support us and help us do our work even if that means working until 1 a.m.

Combating Counterfeit Products ActGovernment Orders

May 31st, 2013 / 12:20 a.m.
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Simcoe—Grey Ontario

Conservative

Kellie Leitch ConservativeParliamentary Secretary to the Minister of Human Resources and Skills Development and to the Minister of Labour

Mr. Speaker, I have to say at this hour I am usually here on my own, just with your, so I am delighted to have so many guests. I am honoured today to rise and introduce C-56, the combating counterfeit products act, at second reading.

Last year our government welcomed the final passage and coming into force of the Copyright Modernization Act, which gave new rights and new tools for copyright owners and users, giving them the certainty and tools they need to fully engage in the online world. As part of the overall balance of the bill, the copyright modernization act introduced specific provisions to deal with the issue of online piracy.

With the combating counterfeit products act, we would be taking the next step in putting in place the legislative changes that are needed to deal with counterfeiting and piracy in the physical marketplace and at our borders. This bill would protect Canadians from harmful counterfeit products. It would help our creative businesses and workers, and law enforcement and border officers confront the increasing threat of trademark counterfeiting and copyright piracy. It would also bring Canada's laws in line with international standards.

Before describing the various features of this bill, please allow me to clarify what counterfeiting and piracy mean in the context of the--

Combating Counterfeit Products ActGovernment Orders

May 31st, 2013 / 12:25 a.m.
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Conservative

Kellie Leitch Conservative Simcoe—Grey, ON

Mr. Speaker, it is easy to get a little caught up at this hour. I know that when even the whip is laughing at my comments, I have a definitely reached a new low in the House of Commons.

I am glad that you are staying straight-faced, Mr. Speaker. I will stay concentrating on you.

It is easy to associate counterfeit goods with designer clothes, watches and so on, similar to what was being spoken about in the lobby by the member for Mississauga South earlier this evening. The reality is that counterfeit goods extend well beyond luxury goods. They are found in nearly all types of commercial and industrial products, from shampoo to smart phones, from industrial ball bearings to brake pads--

Combating Counterfeit Products ActGovernment Orders

May 31st, 2013 / 12:25 a.m.
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Conservative

Kellie Leitch Conservative Simcoe—Grey, ON

Mr. Speaker, I will proceed.

Today they are more pervasive and more difficult to detect and, in this sense, much more problematic. Consumers may even unwittingly purchase a good that they assume to be legitimate, but which contains counterfeit components. We owe it hard-working Canadian families to prevent exposure to such products.

Copyright piracy is the making of illegal copies without consent of copyright holders and their subsequent commercial distribution. We know from our stakeholders, that copyright piracy is increasingly moving online.

The issue of copyright piracy in the physical marketplace is far from resolved, when we think of CDs, DVDs or software being offered for sale in stores and in other markets.

Commercial counterfeiting and piracy are growing issues in Canada and around the world. As with illicit activities, the scope of counterfeiting and piracy is difficult to track and measure.

However, this is what we do know. The RCMP investigated over 4,500 cases of IP crimes in Canada between 2005 and 2012. In 2005, the RCMP seized over $7 million worth of counterfeit and pirated goods. In 2012, this number had grown to $38 million, a fivefold increase.

Canada is not alone. Other developed countries are signalling a rise in the prevalence of counterfeit and pirated goods in the marketplace.

This increase in the value of seizures in Canada is also consistent with what we have heard from Canadian businesses. They have been telling us for years now that counterfeiting and piracy have an impact on innovation and economic growth across the country.

Over the last six years, organizations such as the Canadian Intellectual Property Council and the Canadian Anti-Counterfeiting Network have issued reports calling for legislative changes to deal with counterfeiting and piracy. Most recently, we heard the same calls from several witnesses at a study before the Standing Committee on Industry, Science and Technology.

The measures proposed in the bill are crucial if we are to keep creating high-tech jobs in the future.

Businesses have been overwhelmingly vocal in their support of the bill. For example, Mr. Kevin Spreekmeester, vice-president of global marketing at Canada Goose Inc. and co-chair of the Canadian Intellectual Property Council, said, on March 1:

Canadians have long been victims to the illicit counterfeit trade and the new measures announced today should be welcome news for consumers, businesses and retailers alike.

Mr. Jayson Myers, president and CEO of the Canadian Manufacturers & Exporters, explained that counterfeiting:

—has been a longstanding priority issue for manufacturers...[they] punish legitimate businesses. They are a drain on our economy and on jobs – and they put the health, safety and environment of every Canadian at risk...

Counterfeiting and piracy hurt our economy. However, beyond their economic impact, there are serious criminality and health and safety issues that we simply cannot overlook.

The commercial production and distribution of counterfeit and pirated goods has been associated with organized crime. This is just another line of business for them and it may help them fund other types of activities, such as drug smuggling and illegal firearm sales.

As for health and safety, there are numerous examples of counterfeit goods that could expose Canadians to danger. Think of the counterfeit batteries or car parts, medicines or baby food.

In 2005, 11% of counterfeiting and piracy cases examined by the RCMP involved harmful products. In 2012, this number grew to 30%.

I would also like to take a moment to speak about one of the particular issues that illustrates the growing threat posed by these goods.

In July 2012, Canada Border Services Agency officers referred a shipment to the RCMP for investigation. This shipment contained 476 counterfeit wheel bearings, with a commercial value of $45,000, which were to be used by the Canadian mining industry.

What this illustrates is the fact that these goods have not been subjected to Canadian safety standards and may cause harm as a result. Who knows whether these pieces of equipment would have actually functioned to the standard of levels that we expect in Canadian equipment.

With the new provisions in this bill, we will start to get a fuller picture of the threat that commercial counterfeiting and piracy pose to the Canadian economy and to address it within Canada and at its borders.

Now that I have described the scope of this issue and the very tangible consequences of counterfeiting and piracy for businesses, consumers and the economy, let me turn to a description of the key elements of Bill C-56, the combating counterfeit products act, and of how this bill would help in the fight against commercial counterfeiting and piracy.

To confront this, we must give new authorities to border officers to enable them to act when they encounter commercial counterfeit or pirated goods at the border. We must also give rights holders the tools they need to stop counterfeiting and piracy before these illegal goods can enter the Canadian market and undermine their brand and their work. Third, we must give law enforcement the tools it needs to pursue those who gain commercially from this illegal activity.

With respect to the bill itself, let me expand. First, the bill would strengthen Canada's intellectual property rights enforcement regime at the border. Currently, border officers are not allowed to search for and detain counterfeit and pirated goods without a court order obtained by the trademark or copyright owner, which has proven to be onerous for businesses overall.

Bill C-56 introduces a process that would allow rights holders to submit to the CBSA a request for assistance, which would enable border officers to share information with rights holders regarding suspect commercial shipments.

The request for assistance would allow rights holders to record details about their trademark or copyright at the border, and to provide contact information. It would also contain practical information about how to identify legitimate versus counterfeit or pirated goods. The request for assistance would be an effective tool to enable rights holders to defend their private rights in civil court.

Let me be clear. Bill C-56 would not allow border officers to seize goods for copyright or trademark infringement. It would provide the authority for border officers to temporarily detain goods suspected of being counterfeit or pirated, and then provide limited information to rights holders regarding those detained goods.

This information could only be used to determined if the goods were counterfeit or pirated, or to assist the rights holders in pursuing remedies in the courts. The courts would remain the only competent authority to determine whether goods detained at the border infringed intellectual property rights and to apply appropriate remedies.

The bill would also amend the Trade-marks Act and the Copyright Act to allow border officers to temporarily detain shipments suspected of containing commercial counterfeit and pirated goods. Border officers would be able to act either following a request for assistance or on their own initiative.

With these new measures at the border, we would only target commercial counterfeiting and piracy. There would be a personal use exemption, which means we would not be searching individual travellers possessing personal use quantities.

The bill would provide a specific exception at the border for individual consumers importing goods intended for personal use, as part of their personal baggage.

Goods that were made legitimately in the country where they were produced would be excluded from the new border measures.

With this bill, we would send a clear message. We understand the threats that counterfeiting and piracy represent for our businesses, for the economy and for the health and safety of Canadians, and we are acting accordingly.

Our government has been clear. Our focus remains on jobs, growth and long-term prosperity for Canadians. Counterfeiting and piracy directly threaten each of these. With the provisions in the combating counterfeit products act, our government would be taking action to curb the presence of these illegal goods in our country and at our borders.