The Brand Protection Blog welcomes its first Norton Rose contributor, Mr. Brian W. Gray, Senior Partner, Lawyer, Patent Agent, Trade-mark Agent for Norton Rose Canada. Fulbright & Jaworski L.L.P. will join forces with Norton Rose on June 1, 2013, offering significant depth of experience across Africa, Asia, Australia, Canada, Central Asia, Europe, Latin America, the Middle East, and the United States.

By Brian W. Gray

On March 4, the Canadian Government announced the introduction of a bill to amend the Trade-marks and Copyright Act to combat counterfeiting. However, in addition Bill C-56 (Combating Counterfeit Products Act) makes substantial amendments to the Trade-marks Act which will take some time to consider fully.

Bill C-56 – Combating Counterfeit Products

Lax Canadian laws (particularly with respect to border enforcement) had frequently been a subject of criticism among Canada’s trading partners and a number of parliamentary standing committee reports recommended increased power for border officials . In addition, the lack of effective border enforcement had been one reason why Canada had continued to be on the U.S. Trade Representative’s 301 Watch List. According to the Canadian Government’s Press Release, Bill C-56 will: “. . . reduce trade in counterfeit goods by providing new enforcement tools to strengthen Canada’s existing enforcement regime for counterfeit goods, as well as bolster our existing protections against commercial counterfeiting activities.”

New Combat Powers

Specifically, Bill C-56 will:

  • give border officers the authority to detain suspected commercial shipments and contact the rights holders;
  • allow Canadian businesses to file a request for assistance, with the Canada Border Services Agency (CBSA), in turn, enabling border officers to share information with rights holders regarding suspect shipments;
  • provide new criminal offences for the commercial possession, manufacture or trafficking of counterfeit trademark goods;
  • provide legitimate owners with new tools to protect their rights and take civil action against infringers;
  • create new offences for trademark counterfeiting; and
  • provide better tools to investigate commercial counterfeiting.

  Bill C-56 will include new powers for the Canada Border Service Agency (CBSA) to search and seize and destroy counterfeit goods. However, under the Bill as drafted, the warehousing or destruction of goods will be at brand owner’s cost and the CBSA will not investigate or impound shipments where Canada is not the final destination. The Bill provides a specific exception at the border for individuals importing or exporting counterfeit trademark goods, which are intended for personal use, as part of their personal baggage. Bill C-56 Cloudy on Grey Goods The Bill is somewhat confused about the question of “grey goods.” Certain portions of the Bill seem to allow importation of so-called grey market goods (i.e., where the work was made outside Canada with the consent of the owner of the copyright in the country where the copy was made). These provisions do not seem entirely consistent with other portions of the Bill and further analysis and study is required.

Trade-mark Amendments

Many of the proposed Trade-mark Act amendments do not specifically deal with anti-counterfeiting enforcement. For example, Bill C-56 amends the definition of trade-mark to specifically refer to packaging, colour, shape, sound, scent, hologram or moving images. The Bill proposes amendments to limit the registration of such marks that have not been proven distinctive, or which are dictated “primarily by a utilitarian function.” In addition the definitions of “distinguishing guise” and “wares” have been removed, the definition of certification mark changed and the concept of a “proposed certification mark” introduced for the first time. See Bill C-56.

Canadian Trade-mark Expansions

The Canada Government has taken the opportunity to expand significantly the types of trade-marks that can be registered. This follows upon the Trade-marks Office’s own initiative last year to interpret the Act to allow such marks. However, along with the expansion of the types of trade-marks that may be registered, Canada has taken steps to limit more explicitly the registration of trade-marks that are utilitarian or are not distinctive in fact. Many of the amendments make explicit that marks which are “dictated by a utilitarian function” are not registrable and that such registration does not prevent a person from “using any utilitarian feature embodied in the trade-mark.” Such limitations had previously only applied with respect to the now soon to be defunct “distinguishing guise.” In addition, the Federal Court is given explicit power to expunge (cancel) any registration that is “likely to unreasonably limit the development of any art or industry.” Concurrent with this, the Registar will be given expanded powers to require evidence that any trade-mark is distinctive if the trade-mark consists exclusively of a single color or combination of colors without delineated contours or the trade-mark consists exclusively or primarily of a shape, packaging, sound, scent, taste or texture. In respect of oppositions, the Canada Trade-marks Opposition Board is given power to strike all or part of a statement of opposition and opponents will be required to serve the written representations on each other rather than to file with the Board as was the previous practice. Finally for the first time, Canadian applicants will be able to file a divisional trade-mark application limiting the original application to some of the goods or services and filing a divisional for the remainder.

This article was prepared by Brian W. Gray (brian.gray@nortonrose.com and 416.216.1905) of Norton Rose’s Trade-mark and Branding Practice and Intellectual Property Practice.