Increased innovation through IP framework changes: the government responds

In March 2013 the Standing Committee on Industry, Science and Technology tabled its report entitled “Intellectual Property Regime in Canada” in the House of Commons. On 18th June 2013 the government responded to the report’s recommendations. While the response does not commit to taking any concrete action, the government has undertaken to consult on certain key issues reflecting its focus on innovation as a key economic component. In particular, the government undertook to consult on:

• Changes required to position Canada to be consistent with the Protocol to the Madrid Agreement Concerning the International Registration of Marks and the Singapore Treaty on the Law of Trademarks.
• Changes required to position Canada to be consistent with the Patent Law Treaty and to address concerns over inadvertent abandonment of patent rights.
• Benefits and changes to position Canada to be consistent with the Hague Agreement Concerning the International Deposit of Industrial Designs.
• Legislative and regulatory changes to reduce the time it takes to grant patents and trademarks.
• Merits and means of protecting confidential communications between IP owners and their Canadian IP agents.
• Existing issues with respect to official marks and possible changes to the official marks regime.

Should the government follow through with the broad undertakings in the response, it could lead to significant changes to the Canadian IP regime.

International treaties
The standing committee recommended ratification of four key international agreements that aim to reduce the procedural burdens, uncertainty and costs associated with IP protection. Two of the agreements harmonise registration requirements: the Patent Law Treaty and the Singapore Treaty. The other two allow businesses to register in multiple jurisdictions with a single application: the Madrid Protocol and the Hague Agreement.

Compliance with these treaties would require an overhaul of Canada’s longstanding IP regime, but could ultimately make it simpler for Canadian businesses to register their IP rights internationally, while also facilitating foreign IP filings in Canada.

Implementation of these treaties might also improve Canada’s position in negotiations with respect to two key trade agreements: the Comprehensive Economic and Trade Agreement, currently being negotiated with the European Union, and the Trans-Pacific Partnership.

The government indicated that it will consider further the potential benefits of these four IP agreements and, if appropriate, consider regulatory and legislative changes that would bring Canadian laws in line with them. It also undertook to address concerns over procedural pitfalls that currently can result in an inadvertent loss of patent rights in Canada.

Turnaround time to grant and registration
The standing committee recommended that the government work with the Canadian Intellectual Property Office, which is responsible for the administration of Canada’s IP regime, to introduce regulations and legislation reducing the time it takes to grant IP rights. The government has agreed to look into this. Reduced turnaround times for IP registration will bring Canada into line with other countries and should help bring innovations to market more quickly, which would benefit both innovators and consumers. However, the government noted that reducing turnaround time should not impact on the quality of the rights granted in Canada.

Confidential communications
The government also promised to consider the merits and means of protecting confidential communications between rights holders and their Canadian patent and trademark agents to bring Canada into line with the approach taken in other jurisdiction with respect to such communications. At present, communications with Canadian IP agents are not necessarily treated as confidential and protected from disclosure in litigation, and concerns have been expressed that this puts Canadian innovators at a disadvantage in litigation outside Canada.

Effective patent system
The government noted that there are three key elements of a well-functioning patent system:

• Quality patents.
• Release and easy access to the technology contained in patents.
• An efficient system of patent rights enforcement.

With respect to enforcement, the government will look at mechanisms to resolve patent disputes at lower costs. One such proposed mechanism is a post-grant opposition procedure which would enable a challenge to the validity of claims in a patent without recourse to the courts.

Official marks
Official marks are available to entities that are under the control and supervision of a Canadian government entity and whose activities benefit the public. Protection is obtained by showing that the entity:

• Qualifies as a public authority.
• Has publicly adopted and used the mark.

No one can adopt the same (or nearly the same) mark in connection with a business unless the official mark owner consents, regardless of the nature of the parties’ businesses or the likelihood of actual confusion. Official marks remain in force indefinitely and few mechanisms are available to challenge them.

The standing committee recommended that the government narrow the eligibility requirements for official marks and restrict their scope to important government symbols. The government acknowledged that the official marks regime is controversial. The government agreed to review the issues surrounding official marks and to consult with stakeholders on possible changes that would prevent official marks from impeding registration of trademarks.

Enforcing rights protection
The standing committee recommended legislative measures to combat counterfeiting and piracy better at the Canadian border, while ensuring respect for civil liberties and due process. In this regard, the government recently introduced Bill C-56, the Combating Counterfeit Products Act, which proposes relevant amendments to the Trademarks Act and the Copyright Act. If passed, the new law will:

• Give customs officers greater authority to work with rights holders to address suspect goods.
• Expand the civil causes of action available in respect of goods crossing the border.
• Create criminal offences for commercial dealings.
• Compensate importers for goods seized in error.

Comment
The response to the standing committee’s report illustrates the government’s existing priorities with respect to IP reform. These priorities have been the subject of discussion within the government and among IP stakeholders for some time. While the government’s commitments for moving forward are in the nature of consultation, the interest expressed in supporting creativity and innovation in Canada, while fostering commercialisation and advancing Canada’s competitiveness in the global marketplace through a robust and balanced IP system, is encouraging.