Implementation of the enhanced system to combat counterfeiting at the Canadian border continues.  On January 1, 2015 provisions came into effect which provide Canada customs authorities with the ability to detain suspected counterfeit or pirated products and to exchange information regarding the products with rights holders pursuant to an approved “Request For Assistance” (RFA) application, as previously reported in our January 6, 2015 IP Update.  

On November 2, 2015, a much awaited official memorandum from the Canada Border Services Agency on the new provisions was released. Memorandum D19-4-3 provides clarification with respect to the RFA system and the related detention process.

A RFA application allows rights holders to list their rights with respect to works that are the subject of copyright, whether or not registered, as well as registered trademarks. There is no government fee associated with filing the application. So far, approximately 100 RFA applications have been filed with the Canada Border Services Agency and the enrolment process is generally taking approximately four to six weeks. Although the memorandum states that limited information regarding counterfeit goods may be provided to rights holders in the absence of an accepted RFA application, this has not been the practice so far. Therefore, it is critical for owners of Canadian copyright or registered trademarks to file a RFA application. Rights holders may include multiple trademarks in a single application.

Although the memorandum states that rights holders may be required to furnish security as a condition of accepting or extending a RFA, no such security request has been made to date.

Once a RFA application is processed, the Canada Border Services Agency will advise the rights holder whether further information and/or clarification is required, that the application has been accepted, or that the application has been rejected and the reason(s) why.

The RFA will be valid for two years beginning on the day on which it is accepted and extensions for additional two-year periods may be available. However, it is the rights holder’s responsibility to submit a request for renewal before the current RFA expires.

When potential counterfeit trademark goods or pirated copyright goods are encountered by a Canada Border Services Agency officer, and there is an accepted RFA application with respect to the goods, the following steps will be followed:

  • The rights holder will be provided with preliminary information, such as a picture of the goods and their quantities, and must, within three business days, advise the Canada Border Services Agency that they wish to pursue a remedy under the Copyright Act or the Trademarks Act.
  • If so, the rights holder will then be issued a “Rights Holders Notice of Detention for Goods Suspected of Contravening IPR” and must, within ten working days (five working days for perishable goods), beginning from when the Canada Border Services Agency officer first sends or makes available a sample or information to the rights holder, provide a copy of a document filed with a court commencing proceedings. During this time, the rights holder may be provided with further information that could assist them in pursuing a remedy, such as information that identifies the owner, importer, exporter, consignee, and/or manufacturer of the goods, and/or an opportunity to inspect the goods. A further detention period of ten working days may be available for non-perishable goods.
  • If the rights holder provides evidence that court proceedings have been initiated, the goods will be detained until the Canada Border Services Agency is informed in writing that:
    • the proceedings are finally disposed of, settled or abandoned;
    • a court directs that the copies or goods are no longer to be detained for the purpose of the proceedings; or,
    • the rights holder consents to the copies or goods no longer being so detained.

Any failure to comply with the above noted time limits will likely result in the goods being released by the Canada Border Services Agency.

The updated memorandum also provides clarification with regard to liability for storage, handling, and destruction charges incurred in connection with goods detained under the RFA system. With limited exceptions, rights holders are liable for these charges beginning from the day the Canada Border Services Agency officer first sends or makes available a sample or information to the rights holder.

However, rights holders that do commence a court proceeding may apply for the court to have the detained goods stored in a more affordable location than, for example, a bonded warehouse, in order to mitigate the potential cost of storage.