Canada Remains on USTR’s 2021 Intellectual Property ‘Watch List’

Trade Update • MAY 2, 2021

Though progress has been made over the past year, Canada remains on the “Watch List” in the U.S. Trade Representative’s annual “Special 301 Report” regarding the adequacy and effectiveness of other countries’ protection and enforcement of intellectual property rights.

The congressionally-mandated report, which highlights key markets in which creative industries have significant copyright concerns and face market-access barriers, is a critically important tool for policymakers to use in identifying issues that impede the ability of U.S. copyright owners to compete in foreign markets.

For this year’s Special 301 Report, the USTR reviewed more than 100 trading partners, placing nearly a third (32) of them on either the Priority Watch List or Watch List.

USMCA Progress

The report states that the most significant step forward taken by Canada was the implementation of important intellectual property provisions in the United States-Mexico-Canada Agreement, in a number of areas where there have been long-standing concerns.

The USTR says it will continue to monitor Canada’s outstanding USMCA commitments with transition periods, including on the Brussels Satellites Convention, copyright term, and patent term extensions for unreasonable patent office delays.

Outstanding Issues

Despite these improvements, various challenges to adequate and effective protection of IP rights in Canada remain, according to the USTR. Significant concerns of Canada’s IP environment that have earned it a place on the Watch List include poor enforcement with respect to:

• Counterfeit or pirated goods at the border and within Canada;
• High levels of online piracy; and
• Inadequate transparency and due process regarding GIs protected through free trade agreements.

Of particular concern according to the USTR is that reported enforcement levels suggest that Canadian authorities “have yet to take full advantage of expanded ex officio powers” (primarily a concern with respect to the treatment of suspected counterfeit goods moving in-transit).

The report also notes that Canada’s system to provide for patent term restoration for delays in obtaining marketing approval is “limited in duration, eligibility, and scope of protection.”

Finally, the USTR says it remains “deeply troubled” by the “ambiguous” education-related exception added to the copyright law in 2012, “which reportedly has significantly damaged the market for educational publishers and authors” (additional information about this issue can be found here).