Industry Committee on Nov. 20th, 2013

[Carla Ventin]

Going back to Lorne's earlier remarks that in an ideal world importers would be responsible and it is difficult tracking down importers to pay for these costs, I agree. But if it's difficult tracking down the importers of these counterfeit products, I would say try harder. Let's figure out a way to do that.

I don't think rights holders should be responsible for the illegal activity of others. If it is your business of importing certain products, you have a responsibility to know what those products are and to understand the rules and regulations of a country.

Yes, it may be hard to track down importers and to get them to pay, but that's not the rights holders' problem.

[Vladimir V. Gagachev]

This goes to what Mr. Lipkus said. The shipper says he is shipping circuit breakers. He doesn't say that he is shipping counterfeit circuit breakers. So the shipper wouldn't.... I can't see how they would be responsible in....

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

They have no way of knowing. Okay.

Mr. Keon, in previous testimony, we heard that when counterfeit goods were seized it was discovered that in another room there was counterfeit medicine, and there was a relationship to Hezbollah. Are you familiar with that particular incident?

Is anyone else familiar with that particular seizure in which they identified Hezbollah as the perpetrator of the illegal importing of counterfeit medicine?

[Jim Keon]

No, I'm not familiar with that particular case. I'd be happy to look at it.

But I would say again that—

[The Chair, Conservative, David Sweet]

Mr. Keon, I'm sorry, but we're out of time. All we had time for was the yes or no answer. I'm sorry about that.

Now we'll go to Madam Quach for five minutes.

[Anne Minh-Thu Quach, NDP, Beauharnois—Salaberry, QC]

Thank you, Mr. Chair.

Thank you to everyone for being here to testify about this very important subject.

My questions are for Carla Ventin and Mr. Gagachev.

You both spoke about additional resources. Mr. Gagachev, you rightly said that you had to use specialists in your industry in particular, even retired gentlemen, to do inspections. Under Bill C-8, all these additional responsibilities would be given to our Canada Border Services Agency officers, with no additional financial or human resources.

Does that trouble you? Do you think the lack of resources will cause problems in applying the legislation?

[Vladimir V. Gagachev]

Yes, exactly. The level of sophistication of counterfeiters does represent a problem. Therefore, the CBSA would have to work with the rights owners as a resource. They would have no idea.... Whether it's simple or difficult to identify counterfeit product, they still need to work with the rights owners. They cannot identify a counterfeit. They are not the experts.

[Anne Minh-Thu Quach, NDP, Beauharnois—Salaberry, QC]

Ms. Ventin, would you like to add anything?

[Carla Ventin]

I think the border officers would require perhaps more resources. I mean, let's think about this. Counterfeiters are becoming much more sophisticated. If the officers are going to be given additional responsibility at the border, I think more training would be required. I think that's a key consideration.

But also, to help alleviate that concern somewhat, don't forget that Bill C-8 will actually allow—for the first time—the border officers to contact and discuss with the rights holders.... For example, our member companies have intelligence and can help out at the border. Hopefully that would be helpful, and we look forward to working with the border officers on this.

[Anne Minh-Thu Quach, NDP, Beauharnois—Salaberry, QC]

So there should be more resources. When the Minister of Industry came to testify, he clearly repeated a number of times that there would be no further investment, that all of it would be part of people's duties.

Should we have an amendment to Bill C-8 that would add financial and human resources? Would you recommend that?

[Carla Ventin]

I'm not sure how the resources are currently allocated, nor of the roles and responsibilities in how the border officers will operate in the future. I'll leave that to the department and the MPs on the committee to determine.

[Anne Minh-Thu Quach, NDP, Beauharnois—Salaberry, QC]

Right. Perfect.

Both of you also addressed the issue of cybercrime involving products sold over the Internet. Should any measures be added to Bill C-8 to cover everything sold over the Internet?

[Lorne Lipkus]

Is your question for anybody?

[Anne Minh-Thu Quach, NDP, Beauharnois—Salaberry, QC]

Yes, my question is for everyone.

[Lorne Lipkus]

Okay. Thank you.

As part of the intelligence-gathering we presently have, and as part of the intelligence-gathering brands will use, as Ms. Ventin has mentioned, when working with customs, the Internet will be dealt with. Right now, not only are we using that information, but we're also working very closely with the Anti-Fraud Centre, which is a very effective way of dealing with Internet-type counterfeiting.

The Anti-Fraud Centre is based in North Bay. It's a partnership of industry, law enforcement, payment processors, and others. They are extremely effective, and we work very well with them. I urge anyone with a counterfeiting problem to deal with them on Internet issues as well.

[Scott Smith]

I would add that the RCMP has announced that they will be adding additional resources to the Anti-Fraud Centre for next year, as part of their priorities.

[Anne Minh-Thu Quach, NDP, Beauharnois—Salaberry, QC]

You just mentioned the RCMP. We finally received some statistics about the RCMP's work. According to them, the number of RCMP investigations dropped in 2012, given that other priority files were drawing from federal resources. That's just one more bit of information that makes me think that we need more resources.

I would like to come back to Ms. Ventin and move on to something else.

You work directly with some small businesses. What fee structure do you think should be put in place to ensure that small businesses can get the same protection as multinationals that have more resources?

[The Chair, Conservative, David Sweet]

Madam Ventin, you'll have to hold on to that question. We're way over time on that round. Maybe you can answer it when you're addressing another question.

Mr. Jean, five minutes.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

Thank you, Mr. Chair.

Thank you to all the witnesses for appearing today.

I will be addressing my questions to you, Mr. Keon. First of all, thank you very much to your industry for the medicines you've donated to Health Partners International. They celebrated $40 million worth of medicines distributed to the world's most needy last year. I know that's in large part your industry. Even now they're delivering medicines to the Philippines. So thank you very much for that.

My question is also in relation to the definition and the suggestions you've made. I see by your brief...which I found quite disturbing, to be honest, as a lawyer as well, because of the changes.

My understanding, in relation to the definition in the current act, is that you are only making a suggestion that two words be deleted, in essence—three words, but only two different words—and in the new definition in Bill C-8, there are actually 14 words that you're suggesting that are different.

So there's quite a difference between the old definition and the new definition, and you're only suggesting a minor change to the old definition—a tweak, in essence—because of the case law that has taken place over the last how many years.

[Jim Keon]

That's correct. We are proposing changes to the current act, changing the word “means” to “describes”, and changing the word “wares” to “goods”. I think they're minor modifications and more reflective of current terminology.

We believe that's sufficient for the changes, yes.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

The courts have been interpreting these for years, I suppose.

[Jim Keon]

Correct.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

How long has this definition in the current act been going?

[Jim Keon]

This definition has been in the current act for more than 50 years now.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

So we have case law from judges all across Canada for the last 50 years using this definition in the current act, which is obviously critical to how the act is interpreted, and you're suggesting only two tweaks to that.