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CANADA JOINS WTO CONSULTATIONS ON INTELLECTUAL PROPERTY RIGHTS IN CHINA
(SOURCE: Foreign Affairs and International Trade Canada New releases -
April 25, 2007 No. 62)
The Honourable David Emerson, Minister of International Trade, today announced that the Government of Canada has asked to participate as a third party in World Trade Organization (WTO) consultations on China’s enforcement of intellectual property rights. The United States initiated these consultations on April 9, 2007.
“We are seeking clarification from China on its intellectual property rights enforcement regime, given concerns expressed by Canadian industry,” said Minister Emerson. “Our goal is to resolve this issue through dialogue with the Chinese government and through cooperation with our trading partners.”
This request is based on concerns expressed by Canadian stakeholders on a range of issues related to China’s intellectual property rights regime. The consultations will provide an opportunity for Canada to relay these concerns to Chinese authorities and to assess the latest steps taken by China to bring its intellectual property regime into compliance with its WTO obligations. If consultations do not succeed in resolving the matter, a WTO panel could be requested to adjudicate the issue.
Counterfeit and pirated goods are a growing global problem, estimated by Canadian industry to impact the Canadian economy by several billion dollars annually. On the domestic front, the Department of Foreign Affairs and International Trade is working with other government departments to enhance Canada’s intellectual property enforcement regime.
The Government of Canada has asked to participate as a third party in WTO consultations with China on that country’s intellectual property rights (IPR) enforcement regime. The United States requested consultations on this issue on April 9, 2007.
Consultations with Canadian industry have revealed concern with China’s IPR regime in a wide range of areas. By joining these consultations, the Government of Canada would be able to participate in discussions on the measures at issue with a view to gaining a better understanding of their effect on Canadian interests.
The object of the consultations is to determine whether China is complying with the WTO Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement; more specifically with Article 61, which provides for “criminal procedures and penalties to be applied at least in cases of wilful... copyright piracy on a commercial scale”, because China’s criminal statutes relating to IPR infringements include quantitative thresholds that must be met in order to prosecute intellectual property rights violations.
Another issue of concern is that Chinese courts have decreed that the default rule for calculating the value of illegal gains or business volume for copyright offences is to use the infringer’s price, rather than the price of the genuine product, the former being much lower than the latter.
Counterfeit and pirated goods are a growing global problem, estimated by the Canadian Anti-Counterfeiting Network to account for billions of dollars worldwide. While there are many sources, it is estimated that more than 60 percent of these goods come from China.
Consultations represent the first stage in the WTO dispute settlement process. This phase allows parties to discuss the measures at issue with a view to resolving their dispute outside of a formal adjudicative process. China is under no obligation to address issues presented by third party members during the consultations. If parties fail to reach an agreement at this stage, a WTO panel can be requested to provide recommendations or rulings on the issue.
In 2006, Canada exported $7.7 billion in goods to China and imported $34.5 billion worth of goods.