The Canadian government describes the Comprehensive Economic and Trade Agreement (“CETA”) as a “landmark trade agreement” that is more ambitious and broader in scope than NAFTA. Among the provisions of CETA are those establishing standards for intellectual property rights (“IPRs”) and putting in place measures aimed at achieving the following goals:
- facilitating the production and commercialization of innovative and creative products, and the provision of services, between Canada and the European Union; and
- achieving an adequate and effective level of protection and enforcement of intellectual property rights. The primary impacts of CETA on IPRs in Canada are the following:
1. Patents and Pharmaceutical Products
1.1 Patent Term Restoration
Patent term restoration is aimed at remedying cases where approval of a pharmaceutical product is delayed under Health Canada’s regulatory marketing approval process. For example, delays in the approval of a product may result in a related patent expiring just as approval is granted by Health Canada. CETA aims to reduce the incidence of this problem by granting up to an additional two years of exclusive marketing rights in Canada beyond the expiration date of a patent.
This sui generis protection would provide the same rights as those conferred by the patent and be subject to the same restrictions and obligations, subject to certain limitations:
- only one term of additional protection is available for any given pharmaceutical product, even where it is covered by more than one patent;
- the additional protection extends only to the pharmaceutical product covered by the marketing authorization and to the use of the approved product before the expiration of the additional period; and
- the additional protection may be revoked if the applicable patent has been invalidated or no longer covers the product approved for marketing, or where such marketing approval has been revoked.
1.2. Patent Linkage Mechanisms Relating to Pharmaceutical Products and Rights of Appeal
CETA provides “equivalent and effective rights of appeal” for all litigants in proceedings based on patent “linkage mechanisms” whereby the granting of marketing authorizations for generic pharmaceutical products is linked to the existence of patent protection.
The Patented Medicines (Notice of Compliance) Regulations (the “PM(NOC) Regulations”) provide for a summary court procedure whereby a manufacturer of generic pharmaceutical products can address a patent belonging to a brand manufacturer by alleging the invalidity thereof or noninfringement therewith. Marketing approval in the form of a “notice of compliance” will only be issued if the allegations are determined to be wellfounded.
The PM(NOC) Regulations do not currently not afford brand manufacturers a right of appeal thereunder. Their only recourse is to sue generic manufacturers for infringement in the regular court system, essentially creating a “double litigation” practice. While generic manufacturers have a right of appeal under the PM(NOC) Regulations, their success pursuant to the summary procedure does not guarantee success in a patent infringement action, as infringement or validity decisions rendered pursuant to the procedure under the PM(NOC) Regulations are not binding in subsequent court litigation involving the same patent.
The provisions of CETA do not precisely establish how these equivalent and effective rights of appeal are to be implemented in signatory countries. However, the documentation published by the Canadian government suggests that Canada would put an end to the practice of “double litigation”.
2.1 Compliance with International Treaties
CETA requires parties to “make all reasonable efforts” to comply with the Singapore Treaty and the Madrid Protocol. The Trademarks Act has already been amended in order to comply with the Madrid Protocol, the Singapore Treaty and the Nice Agreement. When those amendments come into force, Canadian law will be in line with that of more than 90 other countries, which will facilitate the registration of trademarks in those jurisdictions.
2.2. Geographical Indications
CETA affords protection to a wide range of geographical indications. A geographical indication (“GI”) identifies an agricultural or food product as originating in a territory of Canada or the European Union, or in a region or locality of such territory, in cases where a property, the reputation or another characteristic of the product can essentially be attributed to its geographic origin.
Under CETA, more than 170 GIs for agricultural or food products will be protected. While Canadian law already affords protection of some GIs in connection with wines and spirits, CETA considerably broadens the number and types of products protected by a GI. The nature and extent of the protection will vary from one to GI to the next, but the rights of current trademark holders will not be affected.
CETA provides for several exceptions and limitations affecting the protection afforded by some specific GIs. For example, there are exceptions for the continued use of certain English and French terms that are currently in use in Canada. Thus, Canadian producers can continue to use “Black Forest Ham” or “Jambon Forêt Noire” but cannot use the German equivalent (“Schwarzwälder Schinken”). CETA also contains exceptions allowing the continued use of certain GIs currently used in Canada (such as Asiago, Feta, Fontina, Gorgonzola, Munster) where such use is accompanied by qualifiers like “type”, “style”, “imitation”, etc.
CETA’s provisions on copyright are reflected in the current Canadian statutory regime, since the coming into force of the Copyright Modernization Act. No additional statutory amendments are anticipated in this regard.
4. Plant Varieties
CETA requires signatory countries to cooperate in the promotion and enforcement of plant breeders’ rights and new varieties of plants in accordance with the International Convention for the Protection of New Varieties of Plants (the “UPOV Convention”).
Canada and the EU countries are already members of the International Union for the Protection of New Varieties of Plants (“UPOV”) but Canada is only party to the 1978 UPOV Convention and has not yet signed the 1991 UPOV Convention. In Canada, the Agricultural Growth Act, which received royal assent on February 25, 2015, proposes amendments to the Plant Breeders’ Rights Act which will bring Canada into compliance with the 1991 UPOV Convention.
Those amendments provide in particular for the “farmer’s privilege” whereby farmers may save and replant seeds from a protected variety on their own land for propagating purposes.
5. Border Measures
CETA requires signatory countries to maintain or adopt procedures in respect of the importing or exporting of merchandise that allow the detention of merchandise suspected of violating IPRs, either at the request of the IPR holder or by the intervention of the proper authorities acting on their own initiative. In particular, CETA requires:
- the implementation of procedures allowing IPR holders to initiate the suspension or detaimnent of merchandise suspected of infringing IPRs;
- the adoption of procedures whereby the proper authorities can determine, within a reasonable period after the suspension/detainment procedure has been initiated, whether the suspected merchandise infringes IPRs, and
- appropriate remedies, including administrative sanctions and the destruction of merchandise that infringes IPRs.
The Combating Counterfeit Products Act (the “CCPA”), which received royal assent on December 9, 2014, provides trademark and copyright owners with an effective framework for combating counterfeiting activities in today’s environment. The CCPA will help Canadian businesses protect their trademarks and creative works, and contains provisions aimed at ensuring that rights owners are properly indemnified. The CCPA also amends the Copyright Act and the Trademarks Act by adding new civil and penal sanctions and new transborder measures to each of them. In particular, the provisions of the CCPA allow:
- customs officials to detain merchandise suspected of infringing a copyright or trademark;
- IPR holders to submit a request for assistance to customs officials, and
- information sharing between customs officials and IPR holders, in order to facilitate the judicial enforcement of the latter’s rights.
The CCPA updates Canada’s border legislation and its legislation dealing with counterfeiting so that Canada now substantially complies with the requirements of CETA. However, the amendments proposed in connection with the CCPA do not deal with counterfeit GI goods, despite CETA’s express requirements in this regard. Other amendments to Canadian federal legislation are thus necessary.
The provisions of CETA are flexible to the point that it is still debatable whether Canada has fulfilled all of its obligations with respect to IPRs. Canada has however shown initiative in adopting several IPrelated amendments, while CETA was being negotiated. Many of these changes have, or will soon be, implemented, but others are still necessary in order for Canada to fulfill all of its CETA undertakings.