Bill C-86: Shaking Up Canada’s IP Legislation

The Government of Canada has introduced Bill C-86, Budget Implementation Act, 2018, No. 2 (Bill C-86), which proposes a number of legislative changes to Canada’s intellectual property (IP) laws and the Copyright Board of Canada’s (Copyright Board) legislative framework. These changes aim to further Canada’s new IP strategy, which was announced in April 2018. For information on Canada’s new IP strategy, see our April 2018 Blakes Bulletin: Canada Looks to Foster Innovation, Business Growth with New IP Strategy.

PROPOSED CHANGES

Patent Act

If passed, Bill 86 would amend the Patent Act to:

  • Establish minimum requirements for patent demand letters in order to ensure that allegations of patent infringement comply with regulations under the Patent Act. This amendment would apply to letters sent to persons in Canada, regardless of whether they allege infringement of a Canadian or non-Canadian patent.
  • Introduce, for the first time in Canada, a prosecution history estoppel provision. Under this provision, prior statements made by a patentee or patent applicant to the Canadian Intellectual Property Office during prosecution of a patent application, as well as re-examination or reissue of a patent, would be admitted as evidence in proceedings involving the patent. The purpose of the provision is to rebut any representation made by the patentee in the proceeding as to the construction of a claim in the patent.
  • More clearly exempt from infringement an act committed for the purpose of experimentation in relation to the subject matter of a patent.
  • Broaden the prior use exemption by permitting a third party who committed an act before the earliest filing or priority date of a claim of another person’s patent or certificate of supplementary protection to commit the same act at a later date even if it constitutes an infringement of that claim.
  • Require subsequent owners or holders of standard essential patents to act in accordance with licensing commitments made by prior owners.

Trade-marks Act

Bill 86 would amend the Trade-marks Act to:

  • Establish a “bad faith registration” ground of opposition to the registration of a trade-mark and ground of invalidity regarding an existing registration. This amendment seeks to prevent the abuse of the trade-mark regime by users that register a trade-mark with the sole intent of seeking settlement from the legitimate owner and user of a mark.
  • Within the first three years after registration of a trade-mark, require the owner of the trade-mark to show use (or reasons to excuse the absence of use) in order to obtain relief for acts done contrary to their rights under the Trade-marks Act.
  • Require leave of the Federal Court before filing new evidence in the appeal of any decision of the Registrar of Trade-marks (Registrar), eliminating the automatic right to file evidence that currently exists.
  • Enable the Registrar to award costs in a trade-mark opposition and to grant confidentiality orders when parties file commercially sensitive evidence.
  • Eliminate the prohibition on a person’s adoption of a mark that is identical to, or closely resembles, a public authority’s badge, crest, emblem or mark in respect of which public notice has been given by the Registrar, if the entity that requested the public notice is not a public authority or no longer exists.

Copyright Act

Bill C-86 would amend the Copyright Act to:

  • Prohibit the inclusion of settlement offers or payment demands (and other information, as established by regulations) in notices to Internet subscribers whose accounts have been linked to allegedly infringing activities. This amendment proposes to address controversy over the use of notice letters to pressure subscribers into disclosing personal information and/or making settlement payments.
  • Address the procedural and structural challenges faced by the Copyright Board, in order to reduce wait times for the Copyright Board’s decisions and the approval of tariffs. To this end, Bill C-86 would reduce the opposition period to challenge tariffs and require that tariffs be filed earlier, and that approved tariffs be effective for three years instead of one.
  • Implement case management procedures similar to those used in court settings, to empower the Copyright Board to swiftly resolve issues and questions, and establish an overarching mandate for the decision-making body.

OTHER AMENDMENTS

Furthermore, Bill 86 looks to:

  • Amend the Bankruptcy and Insolvency Act and Companies’ Creditors Arrangement Act to allow IP users to preserve their usage rights when IP rights are sold or disposed of in an insolvency proceeding.
  • Establish a College of Patent and Trade-mark Agents, a self-regulatory body governed by members of the profession and public, and responsible for formalizing a code of conduct and establishing disciplinary processes. The federal government retains the regulation-making authority to set requirements for entry into the agent profession.
  • Amend the Access to Information Act and Privacy Act to allow the head of a government institution to refuse to disclose information subject to privilege as set out in the Patent Act or Trade-Marks Act.

NEXT STEPS

These proposed changes may be amended or abandoned during the upcoming legislative process. Organizations should closely track the legislation’s progress through the House of Commons.

Further, the federal government is expected to implement the provisions of the new United States-Mexico-Canada Agreement (USMCA) and may expand Bill C-86 during the legislative process to include the USMCA provisions as well. For information about the USMCA, please see our overview, The New Legal Landscape of USMCA.  

For further information, please contact:

Amir Eftekharpour                     416-863-2480

or any other member of our Intellectual Property group.

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