Thank you.
I'm Steve Sloan, the director of investigations for CBSA.
I want to thank you for the opportunity to present the manner in which Canada Border Services currently helps to combat the proliferation of counterfeit and pirated goods.
The first is via a civil remedy. Both the Copyright Act and the Trade-marks Act permit rights-holders to obtain a court order directing CBSA to detect and detain shipments of goods that are suspected of violating their intellectual property rights. However, it should be noted that as rights-holders have difficulty obtaining the necessary information for a court order prior to the arrival of a shipment, the court order process in Canada is seldom used. It is used less than once a year; I think the exact figure is five times in the last eight years.
Additionally, CBSA may detain IPR-infringing goods pursuant to the criminal process. The Copyright Act provides for criminal sanctions, as does the Criminal Code. When the RCMP shares intelligence regarding importations that would be evidence of a criminal offence, the CBSA will assist a system lookout for the goods. When the shipment is intercepted, CBSA will seize the goods as evidence and transfer the goods to the RCMP, which will proceed with the prosecution. CBSA may also seize and prosecute if the goods are smuggled or are otherwise in contravention of the Customs Act.
Finally, if the CBSA, in the course of examining a shipment for the purpose of administering the Customs Act, consequentially finds goods that may be infringing intellectual property rights, it will ask the RCMP if the shipment meets prosecution criteria that Ken just described, and if so, the goods will be seized as evidence. It is not practical, however, for the RCMP to pursue criminal charges for every suspected violation involving IPR-infringing goods. When the shipment is not significant enough to warrant criminal action, the importer is advised of the suspect authenticity of the goods and in these instances will often choose to abandon the shipment.
This brings us to one of our challenges as an agency. The Customs Act permits the CBSA to detain goods that are prohibited, controlled, or regulated by any act of Parliament until satisfied that they are dealt with in accordance with the applicable act. Currently, however, there is no legislation that specifically identifies counterfeit goods themselves as prohibited, controlled, or regulated. Under the Copyright Act the goods themselves are not prohibited; rather, the offence is against a person who knowingly makes, sells, or imports for sale counterfeit goods. The Trade-marks Act is also silent. There is no ancillary legislation defining counterfeit goods as prohibited. They cannot be targeted or detained by the CBSA under authority of the Customs Act.
Over the years, CBSA has collected some statistics on shipments that border services officers have suspected to be counterfeit. The shipments were examined for unrelated purposes, and the data are therefore not inclusive of all offices.
Nevertheless, over 1,000 shipments of suspected counterfeit goods were observed in the course of a year. The goods consisted mainly of designer clothing, but the CBSA has also come across a wide range of other goods, including DVDs, CDs, MP3 players, software, memory cards, ink cartridges, cellphones, satellite cards, transit tokens, jewellery, watches, perfume, sunglasses, pharmaceuticals, batteries, tobacco, electrical fireplaces, Olympic labels, and military hats. Just recently, CBSA officers in Vancouver and Montreal uncovered a $2 million shipment of suspected counterfeit designer goods smuggled in a marine container.
As you have heard, CBSA is working with interdepartmental partners to explore options that will address the growing concerns over the risks of unsafe counterfeit products, loss of revenue, and involvement of organized crime.
Thank you very much. I look forward to answering any questions you may have.