Industry Committee on April 30th, 2007

[Robert Thibault, Liberal, West Nova, NS]

The point I want to make is this. If I or any customs officer opens a container and it has this cord that I'm seeing, unless it's been plugged in and burnt he's not going to know. You're not going to know unless you know that this shipment is coming in and it's bad. There's no way you can visually tell the difference between a bad shipment and a good shipment.

[Warren MacInnis]

Yes, if they have the training to...which a lot of them have come to at the lower levels. The lower levels, in the people I've dealt with in the field, want to stop this stuff; they don't want it coming into the country. It's the upper levels and into the government that don't seem to have the will to....

[Robert Thibault, Liberal, West Nova, NS]

I don't want to spend too much time on that, but I just wanted to make sure that point was made.

Madam LaBossiere Parr, is there a legitimate use for those chips other than pirating, other than making pirated games or pirated software useful? Is there another reason we would permit them on the market? Would they have a use for anything else?

[Danielle LaBossiere Parr]

The only other thing they could conceivably be used for is if you had a video game console from Asia, for example, and you wanted to play video games from another jurisdiction on them, you could technically use a mod chip to circumvent those protections. Other than that, there is no legitimate use.

I would compare it to, say, somebody who buys a radar detector because they want to track the speed of traffic on their street. How many times is that?

[Robert Thibault, Liberal, West Nova, NS]

The radar detector doesn't track that; it just tracks the radar going by on the street. But it's a similar law. You're allowed to own it, but you're not supposed to use it. I was wondering why it's allowed on the market at all.

You've been on this case, in this line, for eight or nine years, you were saying. What are you hearing from the people in the bureaucracy, or where you've been dealing with this, as the reasons that these actions aren't being advanced?

[Warren MacInnis]

I don't think there's any legitimate reason. What I'm hearing is it just takes more study. There are people who come up with reasons, saying it's not a serious issue, that industry has exaggerated the claims of organized crime, health and safety, things like that.

To be honest, I don't understand why there is any claim that this is not being taken seriously up to this point.

[Robert Thibault, Liberal, West Nova, NS]

I know from the debate that I followed--I'm looking at your cord, and especially when you're looking at your breakers and your emergency room--there's no doubt that there's a safety issue there.

On intellectual property, I have a little more trouble, because I agree from the point of the jobs and so on, but as a Canadian consumer I'm a little dismayed. I saw last week that--and I won't name them--the largest manufacturer of software for computer management operating systems was selling exactly the same software for $100-and-some-odd in North America, but in the Chinese market they would sell it for $3 because they didn't want the counterfeiters to take over.

So if you bought a PC there and you wanted that operating system, it would be $3 to $4 on that computer, and if you wanted it in the North American market, you'd be paying over $100. It would almost appear to me as if there's a bit of gouging on that one in our market, and that is disappointing.

It doesn't excuse piracy, but it doesn't bother me, in the same way as if my house burns down or some children get burned today because somebody has a piece of equipment that they think they have for safety--that circuit breaker piece you're showing me--and it's actually dangerous.

[The Chair, Conservative, James Rajotte]

Okay. We're almost out of time. Does someone want to quickly respond?

Mr. Halickman.

[Michael Halickman]

I note that clothing--the product we bring in--is not very interesting. Nobody is getting burned, nobody is dying, but that's not entirely true. I'm aware of counterfeit shipments for little children, where the zippers would break off and be choking...where the buttons would break off, where it's sleepwear that's supposed to be flame retardant and it isn't. These have brand names, and of course the brand name would conform to all of these regulations. However, the counterfeit conforms to none of them, and the poor consumer is buying the product thinking it's safe for their children and it's not. So even in clothing there's danger, besides the intellectual property.

[The Chair, Conservative, James Rajotte]

Thank you.

We'll go to Monsieur Arthur.

[André Arthur, Independent, Portneuf—Jacques-Cartier, QC]

Thank you, Mr. Chairman.

Let me continue in the same vein as Mr. Masse and Mr. Rajotte. I want to discuss the chain of possession of adulterated goods.

There is no excuse for a restaurant to be in possession of tainted meat. If it has tainted meat in his possession, it can never be excused because it purchased it from someone else. It will be prosecuted for possession, even if it has not sold any of that tainted meat. Simple possession makes it liable to prosecution.

We want to solve these problems of shady dealings, but we cannot trust either China, or Russia, or organized crime. Americans do not trust Canada, and Montreal is becoming the world's greatest clearance house for counterfeit art work. Try as we may to strike at the heart of the counterfeit industry, we will still be working at it 20 years from now.

If possession of adulterated goods was an offence under Canadian law, not necessarily a criminal offence but very costly in fines, no one would dare neglect to verify their supply sources. If any retailer possesses or has sold this kind of product, which could be a product that might catch on fire, or a bogus M. Halickman vest or a Louis Garneau helmet, which the company unfortunately gave to the Chinese, it will be committing an offence subject to harsh fines.

Would the problem not be solved if retailers had to be mindful of their sources of supply? Monitoring supply sources is not the responsibility of the State. That's the retailer's job.

[Danielle LaBossiere Parr]

I think that there would be problems with enforcing such measures. Who would determine the amounts of the fines?

Who is going to go after these criminals, or the individual?

[André Arthur, Independent, Portneuf—Jacques-Cartier, QC]

If you can do it for restaurants, we should be able to do it for Canadian Tire.

[Danielle LaBossiere Parr]

We should, but the problem is resources I think to a large extent. The RCMP and the border agency don't have the resources currently to do it. We want to go after the larger-scale criminals who are perpetrating this behaviour on a regular basis and are profiting tremendously from it.

We're in support of anything that's going to really crack down on this problem, but I think a more viable solution is to increase enforcement and to go after large-scale--

[André Arthur, Independent, Portneuf—Jacques-Cartier, QC]

My point is not enforcement; my point is responsibility. My point is that if you hit the guy responsible for owning such goods, he's going to be careful after that, and if you hit him harder, he's going to be more responsible after that. Isn't that a fact?

[Doug Geralde]

To that point, certainly I think we want to go after that. I think the counterfeiting is so lucrative that if you just hit piecemeal at it, you'll never make it unviable for him.

It's a difficult thing. I think we need a multilateral attack on these things.

We outlined items in the road map. Certainly making people accountable is also a factor, but I don't think there's one answer here, or a silver bullet for everything. I think we need a collage of ideas and concepts. We need to tighten the legislation, we need to have increased resources, and we need to go after legislative changes as well.

[André Arthur, Independent, Portneuf—Jacques-Cartier, QC]

In other words, you want government to do your job.

[Doug Geralde]

No, not at all. We're out there doing the work as well--

[André Arthur, Independent, Portneuf—Jacques-Cartier, QC]

You don't want to be alone and be the one who complains when you find something that's false. You want government to move in and do it with its own resources. It's going to be more economical for you.

[Doug Geralde]

Well, personally...we're out there. We're not even a manufacturer of the product and we're working to help in that area. I think it's a collaborative effort. I think it's private industry; I think it's distributors. I think government has a role. I think everyone has a role. Consumers have a role to become educated and understand that it's not a victimless crime. It's everywhere.

[André Arthur, Independent, Portneuf—Jacques-Cartier, QC]

But the retail store is the place where things get to the public.

[Doug Geralde]

It's one of the areas of access, but flea markets are also....

[André Arthur, Independent, Portneuf—Jacques-Cartier, QC]

That's retail.

[The Chair, Conservative, James Rajotte]

I have two people who want to comment.

We're over time, so briefly, Ms. LaBossiere.

[Danielle LaBossiere Parr]

I think there really is a public interest at stake. That is the reason we feel government should be involved in this issue.