Bill C-56 – Combatting Counterfeit Products Act

Whether strolling down Canal Street in New York City or searching for a bargain on Craigslist, many consumers have come across seemingly authentic luxury goods at a fraction of the original cost. As the saying goes, “if it is too good to be true, it likely is”. The knock-off Chanel purse or fake Beats by Dre headphones may look and feel real, but they are often made with inferior materials and break down relatively quickly. As such, counterfeit products that are passed-off as real can affect consumer confidence in both the primary and resale markets.

On March 1, 2013, the Federal government introduced Bill C-56 in an attempt to ramp up its anti-counterfeiting measures. The Bill proposes significant amendments to several Federal Acts including the Trade-marks Act and Copyright Act. Some of the relevant amendments include:

  1. New criminal offences relating to the selling, distribution, importing and exporting of counterfeit trade-marked goods (or their labels or packaging). Penalties for summary convictions include a maximum fine of $25,000 and/or imprisonment for a maximum term of 6 months. Penalties for indictable offences are a maximum of $1,000,000 and/or imprisonment for a maximum of 5 years;
  2. New civil causes of action that can be used against persons who engage in the sale or distribution of counterfeit trade-marked goods (e.g. knock-off Chanel purse), packaging and labeling to be used with counterfeit goods (e.g. fake headphones sold in a Beats by Dre box) and infringing copies of copyrighted works (e.g. pirated movie); and
  3. New procedure where copyright and trade-mark owners could file a “request for assistance” with the Canada Border Services Agency to enable customs officers to provide the rights holder with information about the owner, importer, exporter or manufacturer of the counterfeit goods (which in turn would allow the rights holder to seek a remedy under the Trade-marks Act or Copyright Act).

In addition, the Bill proposes a number of amendments to the Trade-marks Act, which we will discuss in a further blog post. Check the blog for any updates related to this Bill.