USTR Special 301 Report: Canada in US Hall of Shame for the Third Year Running

Mark Kohras is a JD Candidate at Osgoode Hall Law School.

Every year, the Office of the United States Trade Representative (USTR) releases its Special 301 Report. The report provides a detailed list of countries that the United States believes are deficient when it comes to intellectual property laws or enforcement. Perhaps it is no small surprise, given its inclusion on previous lists, that an odd country finds itself on the highest priority list, among traditional piracy and counterfeiting havens such as China and Thailand: Canada.

The Special 301 Report is essentially a United States “hall of shame” used mainly as a tool to place political pressure on foreign governments to conform to United States intellectual property law standards. Although the list does not carry any direct repercussions, inclusion on the list can lead to trade disputes and possible economic sanctions by the US. Although Canada’s inclusion on the list may seem out of place at first, it may not be so surprising that they are paying such close attention to Canada, given our status as the US’s top trading partner.

The US’s concerns stem from a few issues, chief among them being Canada’s copyright laws. Recognizing that Canada’s 3rd attempt at copyright reform was once again unsuccessful (as the result of yet another election), the United States continues to push for a badly needed update to Canada’s Copyright Act, which has not been amended since 2005 (and not had a major update since long before then). As the report notes “The United States encourages Canada to make the enactment of copyright legislation that addresses the challenges of piracy over the Internet, including by fully implementing the WIPO Internet Treaties, a priority for its new government.”

The United States is also concerned about trafficking of counterfeit and pirated goods at the border, requesting that Canadian border officials be granted the authority to conduct warrantless seizures of suspected pirated or counterfeit material, stating that “Canada should provide its Customs officials with ex officio authority to effectively stop the transit of counterfeit and pirated products through its territory.”

The 2011 report also marks the first time the United States has issued an invitation to countries on the list to work together with the United States to “cooperatively develop action plans to resolve [intellectual property rights] issues of concern”. However, given the recent election of a majority government and the Conservative government’s pledge to re-introduce the Copyright Modernization Act (previously Bill C-32) it is likely that Canada’s fourth attempt at copyright reform will pass. Hopefully, with the US’s major concern out of the way, Canada will be taken off the priority watch list for 2012.

The priority watch list is the highest watch list and names countries that the United States feels are the top IP offenders. It includes China, Russia, Algeria, Argentina, Canada, Chile, India, Indonesia, Pakistan, Thailand, and Venezuela. To read the special report, including the United States concerns regarding each of these countries, please see here.

  1. With technology being able to expose people across the world to a huge variety of music, movies, TV, and a wide variety of IP generally, the need for consistent IP protection has never been greater. A creator in France may suffer the worst damage from copyright infringement a thousand miles away and have no meaningful recourse due to a difference in the laws in the infringer’s home country.

    It would be interesting to see how the United States leading this sort of “cooperative action” may or may not be biased toward protecting the music industry and Hollywood.

  2. Ratifying and implementing the WIPO Internet Treaties should definitely be a priority for Canada. Not doing so has created a considerable amount of uncertainty, especially for the courts. It isn’t suprising that this uncertainty has forced the Supreme Court of Canada to rule on cases in a manner as if the Treaties were ratified (Robertson v. Thomson Corporation [2006]).

    The counter-argument could be that since decisions by the Supreme Court of Canada are being made with the Treaties in mind, perhaps their ratification isn’t necessary. The problem is by not doing so, Canada will never escape the United States’ “hall of shame”.

  3. The inclusion of Canada on this list is both ridiculous and old news. Where is this army of plaintiffs who are supposedly left without any recourse as a result of Canada’s “antiquated” copyright laws?

    @Brent, the need for consistency in IP laws runs both ways. Your hypothetical French creator would have a tough time enforcing their moral rights in the US.

  4. @Brent, the US is definitely trying to protect the music industry and hollywood. As a net exporter of digital IP, the United States has a vested intrest in strong copyright laws across the globe that favour all copyright owners (including hollywood). Canada, being a net importer, has different priorities regarding copyright law and may favour a different balence between creator and consumer rights than the US is hoping for.

    @Danny, it might be stretching things a little far to suggest that the Supreme Court is ruling on cases as if the treaties were ratified. While they can use various treaties as a guide in interpreting Canadian law, they cannot “write in” laws that are not covered under our act. The main problem the US has with Canada is the absence of laws covering modern digital issues, such as digital locks. This absence leaves an ambiguity too great for the Supreme court to fill without taking on a legislative role, which is not the purview of the courts.

    @Bart, I agree with you that consistency runs both ways. The problem with consistency in copyright is that each country has different values. The treaty process is supposed to allow all countries to compromise when it comes to copyright. The problem with the Special 301 report process is that it is mainly a tool for the US to provide political pressure instead of a tool for compromise.

    Copyright is a controversial issue in Canada. Regardless of what the final draft of the copyright act will look like, many people are undoubtedly going to be upset. Politically, this means that many governments (particularly minority governments) are hesitant to take it on. The US is attempting to pressure the government to pass copyright reform, which most sides will agree would be helpful in clarifying the law as it relates to modern digital issues. Our government, in response, must ensure that any reform reflects Canada’s values. This does not mean we can ignore international pressure, but neither must we bow to it. Given the global nature of digital media today, it is almost certain that we will need to take the interests of other countries (including the US) into account, specially if we want them to consider our interests in other areas of trade. However, foreign interests can only be one factor when considering reform, and while they may influence domestic policy, they should not dictate it.

  5. I was exaggerating slightly for effect. Sure, the Supreme Court cannot “write in” laws; however, using various treaties as a guide in interpreting Canadian law is an indication of the legal uncertainty I am attempting to convey. Using treaties as a guide for legal interpretation is just one step behind ratification. Albeit others may not agree.

    You’re absolutely correct. The Supreme Court taking on a legislative role is not the “purview of the courts”. However, the exact point where the courts move from a judicial role to a legislative one is often uncertain. There are too many cases to list where dissenting judges and legal scholars have felt that the judiciary had gone beyond their powers and into the realm of the legislature.

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