Thank you very much, Mr. Chairman and honourable members of the committee.
I'm delighted to be here today on behalf of the Canadian Chamber of Commerce. I'm also pleased to introduce my colleague. Lee Webster is a partner at Osler's, and also, importantly for us at the chamber, chair of our intellectual property committee.
As the organization speaking for Canadian business, the Canadian Chamber of Commerce is the most representative organization for business people in Canada.
We are speaking today on behalf of a network of 350 Chambers of Commerce and other business organizations representing more than 170 000 member companies.
The chamber is pleased to provide its input before this committee on the issue of counterfeiting and piracy. We've been working closely with the Canadian Anti-Counterfeiting Network, the Canadian Recording Industry Association, and other national organizations, such as the Retail Council of Canada, to offer tangible solutions to the problem.
As you'll hear shortly, the CACN will speak to the release of a comprehensive report that we at the Canadian chamber endorse.
Quite frankly, Canada is losing the war on counterfeit goods--that's our starting point. While counterfeiting used to consist mainly of knock-off T-shirts or watches or other luxury items, the low risk and high profit margin has allowed criminals, including organized crime, to become very active, counterfeiting everything from drugs, brake pads, and other car parts to electrical products and personal care products. Virtually no industry escapes this illegal activity, and the counterfeit activity poses serious health and safety risks due to the poor quality of the products and the potentially hazardous nature of fakes.
According to a report from Criminal Intelligence Service Canada, an organization chaired by the RCMP, no country is immune to counterfeit drugs. In fact, the World Health Organization has estimated that 10% of all medication available is counterfeit. While it is well documented that in developed nations the control and enforcement of drug supplies is far more difficult, we have 50% and over of counterfeit drugs in some regions like Asia in Africa, and Canada is certainly not immune from the problem.
The criminal element, unfortunately, does not care if counterfeit products are unsafe for consumers; they care only about turning a profit. Some counterfeit batteries imported into Canada have been found to contain mercury and have posed a threat to explode because they were not properly vented. Counterfeit shampoo contaminated with bacteria that could cause infection has been found in Canada and imported into the U.S. from here.
Counterfeiting and piracy continues to grow at an exponential rate, and it is relatively unchecked in Canada. The problem is worth, in our estimation, billions of dollars annually, and it's growing. The economic impact of the problem--and this is our real starting point on our discussion, Mr. Chair--is that lost revenue for companies and for the government as well is most significant.
In a knowledge-based economy, intellectual property is an essential element for promoting investments in R and D, innovation, international trade and investment, consumer protection, and overall economic growth. In the rapidly changing global economy, protecting IP is critical to ensuring a competitive Canada--that's our starting point.
Now it's my pleasure to turn it over to Lee Webster to get into some of our more specific recommendations.