Brand Owners Urged to Record Rights with Canadian Customs

Less than a year has passed since the United States–Mexico–Canada Agreement (USMCA) entered into force on July 1, 2020. Its passage empowered Canadian customs officials to detain in-transit commercial shipments of suspected counterfeit goods. Previously, Canadian customs officials could detain only commercial shipments of suspected counterfeit goods destined for Canada.

Since the USMCA became effective, Canada’s customs officials have exercised their authority, and brand owners have seen a more than 70 percent increase in detentions of commercial shipments of suspected counterfeit goods.

While Canada’s border enforcement program now offers rights holders more powerful tools than ever before to protect against the unlawful importation of counterfeit and pirated goods into Canada, rights holders must do their part and file a request for assistance with the authorities. Rights holders will only receive the full benefits of Canada’s border enforcement program once they record their rights with the Canada Border Services Agency (CBSA).

Since 2015, Canada has offered rights holders the ability to prevent counterfeit and pirated goods from entering the Canadian marketplace by recording their registered trademarks, protected geographical indications, and copyrights with the CBSA. Prior to the implementation of the USMCA, customs officials were not permitted to detain goods that were transiting, or traveling through, Canada.

However, now, as part of the implementation of the new trade agreement, customs officials may detain in-transit commercial shipments containing suspected counterfeit and pirated goods.

Given this change, as well as the proliferation in counterfeiting worldwide, it is critical for rights holders to record their rights with the CBSA by completing and filing a Request for Assistance (RFA) application. Once the rights are recorded, customs officials who detect an inbound or outbound commercial shipment containing suspected counterfeit and pirated goods will contact the rights holder via its Canadian counsel and give the rights holder the information regarding the shipment, including the nature and quantity of the suspected goods, photographs of the goods, and the identities and addresses of the importer and exporter.

The rights holder may then elect to commence an action against the importer and/or exporter, in which case the CBSA will detain the goods until the action is settled or a court decides the action. Nearly 80 percent of cases result in an out-of-court settlement and destruction of the detained goods.

Therefore, an RFA is a highly effective and efficient way of not only collecting important information about the activities of counterfeiters, but also stopping the unlawful importation of counterfeit and pirated goods.

Rights holders can record all their registered trademarks, protected geographical indications, and copyrights in a single RFA, and update their recordal as often as they wish. There is no government fee for filing an RFA. However, it must be renewed every two years.

According to a 2018 report by INTA and the International Chamber of Commerce Business Action to Stop Counterfeiting and Piracy (ICC BASCAP) titled “The Economic Impacts of Counterfeiting and Piracy,” the global value of counterfeiting and piracy is expected to reach $2.81 trillion by 2022.

Statistics collected by the CBSA show that rights holders’ active participation in the border enforcement program is key to preventing suspected counterfeit and pirated goods from entering the Canadian marketplace. Evidence suggests that rights holders need not fear excessive or unrecoverable costs when enforcing their rights through the program. As noted, the vast majority of cases are resolved prior to trial, and rights holders are often able to recover the costs associated with the storage and destruction of the infringing goods.

Please contact us with any questions regarding Canada’s border enforcement program or for assistance with filing an RFA with the CBSA.

Although every effort has been made to verify the accuracy of this article, readers are urged to check independently on matters of specific concern or interest.

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