For the first time since 2012, Canada has once again been named to the “Priority” Watch List in the 2018 Special 301 Report on Intellectual Property Rights, put out by the Office of the United States Trade Representative (USTR).

This downgrade is in part due to Canada’s “poor border enforcement” relating to counterfeit goods. Concerns over Canada’s protections for intellectual property had abated somewhat – if not entirely – in 2013, with strengthening of Canada’s copyright laws and the passing of legislation specifically designed and intended to combat counterfeiting. However, the lack of criminal enforcement and effective border enforcement, along with exceptions which allow for counterfeit goods to be transshipped through Canada into the United States, have placed Canada back on the priority list, on the same level as China, India, Russia and other countries with traditionally weaker protection for intellectual property rights.

This news comes on the heels of the release of USTR’s 2017 “Notorious Markets” report late last year, which for the first time named a physical Canadian location – Pacific Mall located in the Toronto area – as a haven for the sale of counterfeit goods, alongside markets such as the notorious “Silk Market” in Beijing.  Pacific Mall is a predominantly Chinese-Canadian shopping centre, which the report notes is “a well-known market for the sale of counterfeit and pirated goods for over a decade”, where vendors “appear to operate largely with impunity” and “requests for assistance from local law enforcement [go] unanswered”.

Dealing in counterfeit goods hurts the Canadian and global economies and has proven ties to organized crime and the funding of terrorism. It is a criminal offence – and should be treated as one – but holes in Canadian legislation, and lack of allocation of resources, has left enforcement against counterfeit goods largely in the hands of the right holders instead of law enforcement, sometimes even in cases where the goods pose a safety risk to the public.

Stronger legislation, including better and simplified border provisions, and greater public education to encourage increased allocation of law enforcement resources, are seen as key to improving enforcement and protecting the public in Canada. Our Vancouver office was recently involved in a Crime Stoppers media release with those goals in mind: