US Releases Report on Protection of American IP Rights Across the World; Canada Remains on Watch List

April 27, 2016

The United States Trade Representative (USTR) released the 2016 “Special 301” Report on the global state of intellectual property rights (IPR) protection and enforcement.

The Report serves a critical function by identifying opportunities and challenges facing U.S. innovative and creative industries in foreign markets and by promoting job creation, economic development, and many other benefits that effective IPR protection and enforcement support.

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Placement of a trading partner on the Priority Watch List or Watch List indicates that particular problems exist in that country with respect to IPR protection, enforcement, or market access for persons relying on IPR.

Canada is one of 23 countries on the Watch List, along with Barbados, Bolivia, Brazil, Bulgaria, Colombia, Costa Rica, Dominican Republic, Ecuador, Egypt, Greece, Guatemala, Jamaica, Lebanon, Mexico, Pakistan, Peru, Romania, Switzerland, Turkey, Turkmenistan, Uzbekistan, and Vietnam.

Canada

Canada remains on the Watch List in 2016. The United States welcomed Canada’s amendment to its Copyright Act to extend protection for sound recordings to 70 years from the date of the recording. However, the United States continues to urge Canada to fully implement its commitments pursuant to the WIPO Internet Treaties and to continue to address the challenges of copyright piracy in the digital age. The United States remains deeply concerned that Canada does not provide customs officials with the ability to detain pirated and counterfeit goods that are moving in transit or are transshipped through Canada. As a result, the United States urges Canada to provide its customs officials with full ex officio authority to improve its ability to address the serious problem of pirated and counterfeit goods entering our highly integrated supply chains. With respect to pharmaceuticals, the United States continues to have serious concerns about the availability of rights of appeal in Canada’s administrative process for reviewing regulatory approval of pharmaceutical products as well as about the breadth of the Minister of Health’s discretion in disclosing confidential business information. The United States also continues to have serious concerns about the lack of clarity and the impact of the heightened utility requirements for patents that have been imposed by Canadian courts. In these cases, courts have invalidated valuable patents held by U.S. pharmaceutical companies on utility grounds, by interpreting the “promise” of the patent and finding that insufficient information was provided in the application to substantiate that promise. These recent decisions, which have affected products that have been in the market and benefiting patients for years, have led to uncertainty for patent holders and applicants, including with respect to how to effectively meet this standard. This unpredictability also undermines incentives for investments in the pharmaceutical sector. The United States understands that the Supreme Court of Canada may have the opportunity to clarify this doctrine in the coming year. The United States urges Canada to engage meaningfully with affected stakeholders and the United States on patent utility issues. The United States also looks forward to working closely with Canada in the coming year to explore ways to address each country’s IPR priority issues.

Under the TPP Agreement, which sets strong and balanced standards on IPR protection and enforcement (See Trans-Pacific Partnership), Canada has committed to strengthen its IPR regime in many of these, as well as other, areas. The United States will work closely with Canada on TPP implementation.

The full report and associated press release are available on the USTR website.