The Canadian government joined many of its counterparts around the world when it introduced a program at the beginning of 2015 to limit the transport of counterfeit goods in and out of Canada.
The Combating Counterfeit Products initiative allows the Canada Border Services Agency to flag and temporarily seize goods that it deems suspect and then notify the rights holder. All Canadian rights holders need to do is ensure that their trademark is registered with the Canadian Intellectual Property Office and then submit a Request for Assistance application to customs, free of charge.
“To give you an example of how important this is, there was a luxury goods shipment that crossed into Canada and the brand owners for a certain number of the goods on board had registered their marks with customs, so those items were held,” said Stephanie Vaccari, partner in Baker McKenzie’s Intellectual Property Group and head of our Toronto office’s Luxury and Fashion Group.
“The rest of the goods in that shipment were let through because they weren’t registered so those brand owners had a bunch of counterfeit goods hit the market in Canada.”
However, as easy as it sounds to partake in the process, many companies still haven’t submitted an RFA form for any of their trademarks and Stephanie is concerned it could become a missed opportunity for clients.
“There is a trial period of this program being in place. Initially the government gave about a two-year timeline so if participation doesn’t increase it might decide to get rid of this whole system,” she said.
“Canada was actually behind a number of underdeveloped countries on this issue so we were excited when the government decided to go this route. But if more brand owners don’t take advantage, it might just fall by the wayside, which would be unfortunate.”
One reason companies may be holding back is that it’s the trademark owner’s responsibility to pay for destroying or storing any goods seized by Canadian customs. Once notified by customs, owners will have three business days to decide how they want to proceed. If in that time an owner advises customs that it wants to pursue a legal remedy through civil court, customs will detain the goods for a maximum of 10 working days (five days if perishable). In some cases an extension can be granted for the detention of non-perishable goods.
“Yes, companies would take on that responsibility but ultimately they could still choose to let the goods go through if they didn’t want to do anything with them or pursue legal action,” Stephanie said. “So, at least you still have a choice and if you don’t register you have no idea what’s going through customs. It’s a cost-benefit for brand owners to do this.”
As part of the RFA application process, companies can educate customs on what to look for when checking their shipments. Sometimes a simple tag in the wrong place or a difference in stitching on clothing can raise the counterfeit flag, so the more detailed an application is, the better. Customs can then provide pictures of seized goods or rights holders can go in person to determine if they are counterfeit.
Essien Udokang, an associate in our North America IP Group and our Toronto Luxury and Fashion Group, says it’s a no-brainer for clients.
“Canada hasn’t always been known as a space for counterfeit goods but it’s becoming more so with more complex things such as tech, fashion and pharma. So absolutely, this is something our clients should be taking advantage of,” he said. “Their marks are already being managed by us and it’s so easy to file them and erect that protective wall.”
According to the CBSA, it can take from four to six weeks to process an RFA but Essien says each time he’s submitted one for a client thus far he’s received confirmation from customs within one week.
“We’re telling our clients, ‘Let’s do one or two and see what it’s like,'” Essien said. “And it’s their core marks, their house marks. I think it will only take an alert or two from customs catching something crossing the border before clients’ ears perk up, which may encourage them to submit an RFA for their other marks.”