Good morning, Mr. Chair, honourable members, ladies and gentlemen. Thank you very much for inviting Hockey Canada to participate this morning in the standing committee's study of the intellectual property regime in Canada.
Hockey Canada is the country's national sport organization. Our association is responsible for the creation and implementation of hockey-specific programming for Canadians from entry-level beginners through to high-performance athletes competing at world championships and in multi-nation games, such as the Paralympic and Olympic Games.
Our programming extends to volunteer coaches, officials, and administrators from coast to coast to coast. Over the last 20 years, through retail licensing Hockey Canada's brands—Team Canada, Équipe Canada, our logos, our trade dress, etc.—have all been diligently cultivated to provide a substantial revenue stream for the association. The growth in the popularity of the Team Canada brand over this time period has caught the eye of counterfeiters not only here at home but abroad as well.
Counterfeiting of the Team Canada brand has developed into a robust form of underground commerce, as expressed by my colleagues here today with their specific product lines. It's regularly found in the marketplace alongside a multitude of other brands and intellectual properties. It's found at bona fide retailers, among mass merchants, in convenience stores, at flea markets. It's found on Internet auction sites. We even found counterfeit Hockey Canada products advertised on downtown Toronto parking meters.
Counterfeiting of Hockey Canada products not only dilutes the value of the intellectual property itself; it takes millions of dollars away from legitimate Canadian retailers selling Hockey Canada products. Counterfeiting also affects our licensing partners. It reduces Canadian jobs and services in the Canadian supply chain and elsewhere, all leading to a multitude of direct and indirect domino-type effects, such as lost taxes that would be paid by legitimate Canadian businesses.
In our particular case, counterfeiting means lost royalty revenue. Lost revenue for Hockey Canada equates to lost opportunities to support wholesome athletic opportunities for all Canadians.
Several recent observations by my colleagues at the NHL and the NHLPA have indicated that as many as 75% of all jerseys worn to an NHL game are counterfeit.
We saw a similarly high ratio of counterfeit to authentic jerseys during the 2010 Olympic Games. In a time span of less than two weeks during the 2010 games, the RCMP and the Canada Border Services Agency at the Vancouver mail facility only intercepted and detained more than 16,000 counterfeit jerseys with a retail value above $2.3 million. Once we were contacted and the RCMP provided us with background information on the escalating arrival of suspicious Team Canada jerseys, together we estimated that less than 20% were intercepted compared with the number of counterfeit jerseys imported into Canada leading up to and during the Winter Games.
At the request of the RCMP, Hockey Canada arranged for additional personnel to assist with the processing of these counterfeit jerseys. Costs were absorbed by our association for this step, which highlights the limited resources available to front line officials.
There are substantial costs and inherent difficulties to the enforcing by brand owners of intellectual property rights through civil avenues. We are dealing with criminals who do not adhere to any laws and do not keep any records for anyone to be able to establish what profits may have been made. As a double whammy, many counterfeiters simply view any exposure to civil remedies here in Canada as a cost of doing business. Monetary penalties or awards are generally small and much less than the actual costs associated with the enforcement and civil action, even assuming that we can collect on those. Without statutory damage awards or appropriate border seizure capabilities, Canada's current civil remedy toolbox is somewhat limited.
Counterfeit product cannot be considered safe by any means whatever, with no adherence to the Canadian Consumer Product Safety Act, the Competition Act, the Consumer Packaging and Labelling Act, etc.
Unknown origins also lead to a whole sector of unknowns, all too numerous to list and all too common to everyone in the room. The current supply chain of counterfeit Team Canada jerseys is dominated by manufacturers based overseas, and counterfeit commerce is conducted through the Internet. This channel makes it virtually foolproof for any individual with a credit card and a mailing address to participate as an importer of counterfeit goods.
For example, our case file has civil action conducted in Ontario against a barber shop owner and a school teacher; in Manitoba, against a butcher shop owner; and in Alberta, two students who attempted to offset their Olympic ticket expenses by selling Team Canada counterfeit jerseys that they imported from Asia.
This underscores the need for better education of the public. Industry is prepared to partner with government in the education process, but cannot do it alone. The ease of access via the Internet has exponentially added to the counterfeit Team Canada products in the country. Importing or for that matter exporting counterfeit products should be treated with strong measures. With virtually no deterrent currently for importing or possessing counterfeit goods in Canada, this channel will continue to be utilized by counterfeiters to ply their unauthorized goods.
As a registered brand owner with the Canadian Intellectual Property Office, Hockey Canada has the responsibility to monitor and police our intellectual properties and brands. The tools afforded to brand owners such as ourselves through the Trade-marks Act and the Copyright Act realistically are limited. Hockey Canada regularly engages the services of anti-counterfeiting experts, dedicated legal counsel, and trained investigators to assist with the ever-elusive task of counterfeit enforcement, consuming very valuable financial resources for our association.
Hockey Canada continues to support and participate in actively engaging the efforts of the Canadian Anti-Counterfeiting Network and the Canadian Intellectual Property Council, as Chris mentioned earlier. We support the need to strengthen Canadian legislation to empower front-line enforcement officers to target and seize counterfeit goods. Greater resources are also necessary for the officers to process seized counterfeit goods and effectively deal with these items. We strongly support the recommendations these two organizations have proposed.