|The USMCA’s main
changes for Canada
The chapter on IP rights in the USMCA (Chapter 20)
is 63 pages, touching on a wide range of issues. The
four biggest changes are:
- Data protection term for biologics
increased from eight years to 10 years
- Copyright term increased from life
of the author plus 50 years to life of the author
plus 70 years
- Introduction of a patent term
adjustment procedure to compensate for Canadian
Intellectual Property Office delay in issuing a
- Pre-established damages for trade
The United States-Mexico-Canada Agreement (USMCA) finally
formed late on a Sunday night, hours before the October 1
The USMCA is essentially NAFTA, rebranded. President Donald
Trump had long made his dislike of NAFTA known.
The deal increases protections granted to IP rights holders
across the board. IP practitioners have welcomed many of its
provisions. But other observers are less pleased.
Richard Gold, IP professor at McGill University in Montreal,
calls it "a net loss for Canada in terms of IP." He says this
is because "every time you grant expanded rights, you make it
harder for future innovators. When the majority of incumbents
are outside Canada, the increased protection is to our
Michael Geist, IP professor at the University of Ottawa,
agrees, describing the deal as "Canada caving to US pressure on
IP." This wouldn't be the worst thing as long as Canada adopted
the good with the bad from the US, but it hasn't, Geist
believes: "The US has exported some of its
rights-holder-oriented provisions, but it hasn't exported some
of the balancing and flexibility that it has under its law."
For example, Geist wishes that the US's robust fair use
provision could have been included, or that Canada's Crown
copyright – which protects public documents –
could have been abolished.
Gold adds that a "major flaw" in the US patent litigation
system is unfairness to foreigners. "If you're located in the
US, you have procedural advantages [including venue options]
that you do not have if you're a Canadian firm," Gold explains.
"You can have all the patents you want, but if you can't
enforce them they have no value." The USMCA will establish a
committee to work on harmonisation issues going forward,
The USMCA introduces the following changes:
The biggest change for patents is that the term of data
protection for biologics has been extended from eight to 10
years. This is a win for brand-name pharmaceuticals, which
lobbied for the change to secure longer exclusivity. Cheaper
biosimilars will be prevented from entering the market for an
extra two years, causing drug prices to stay higher for
Another big change is that Canada will adopt the US practice
of patent term adjustment. Patents traditionally expire 20
years from filing an application. Under the USMCA, patent
applicants can begin accruing day-for-day patent term
extensions if the patent office is "unreasonably delayed" in
its determination. This is defined as a delay of more than five
years from application, or three years from a request for
examination – whichever is later. If applicants
intentionally delay the process, this time will be subtracted
from any extension. This is a big change for Canada because the
US has been unique in having this system of patent term
The USMCA settled a much-disputed topic when it established
that internet service providers (ISPs) are not liable for
third-party content. The University of Ottawa's Geist is happy
with this point. "It's one of the few examples of things I do
think are a useful addition to Canadian law," he says. "The
absence of those rules has put Canada at a disadvantage in
being able to attract some companies to Canada."
The USMCA maintains the existing notice-and-notice system
for handling infringing content online. Rather than taking down
allegedly infringing content immediately, like in the US's
notice-and-takedown system, Geist explains that Canada is "more
focused on trying to educate internet users and the public on
the scope of copyright, and alerting them that they may have
McGill professor Gold says it works well in Canada. "Maybe
it's because we're Canadian," he laughs, "but people generally
abide by it. It preserves the ability [to leave content online]
if there is a legitimate reason."
The biggest change to Canadian copyright law as a result of
the USMCA is that the term of copyright protection has been
extended from the life of the author plus 50 years to the life
of the author plus 70 years, and the change is retroactive.
Those who own a lot of copyrights, such as major labels and
studios, lobbied for the change, according to Gold. "This
doesn't provide any greater incentive for innovation, because
creators get no benefit," he says. "It just pays the IP owners
Gold says this is the latest in a long line of "protection
increases," and that the trend is worrying. "It won't shut down
innovation," he says, "but every time you increase the rights,
it becomes that much harder. It's like the frog in heating
water. It's the cumulative effect of all this ratcheting up
that concerns me."
The more data there is, the more accurate the result.
However, private datasets will be blocked for an additional 20
years, which limits researchers' and even artificial
intelligence's ability to access certain information.
The final notable copyright-related change is that the USMCA
cancels an arrangement that has allowed US commercials to be
aired in Canada during the Super Bowl. Geist at the University
of Ottawa says: "It's very unusual because it's calling on the
government to rescind the decision of an independent
The detail made it into the USMCA because "the NFL and Bell
Media – Canada's largest broadcaster – made
it an issue," Geist explains. He adds: "There was a fair amount
of lobbying pressure in the United States for it. They think
they can sell the rights to their broadcast in Canada for more
than Canadian companies."
design regime gets underway!
On November 5, Canada finally acceded to the Hague
Agreement Concerning the International Registration of
Industrial Designs and implemented changes to modernise
Canada's industrial design regime. There are now 69
contracting parties to the Hague Agreement.
The Hague System provides a mechanism for acquiring,
maintaining and managing design rights in multiple
countries through a single application filed with
Canada's Industrial Design Act was amended in 2014
– the first substantive update since 2001
– and new Industrial Design Regulations were
finalised in the Canada Gazette, Part II, in 2018.
Highlights of changes in the Industrial Design
Regulations this year include:
- Electronic communications will be
deemed received 24/7, regardless of whether the
office is open or closed to the public.
- Filing date requirements have been
simplified to align with international standards. The
title, description and complete mailing address are
no longer required. To obtain a filing date,
applicants need only provide: an indication that
registration of a design is sought; a means of
identifying the applicant; contact information; and a
representation of the design.
- Application requirements have been
simplified. The prescribed application form is no
longer required. The description is now optional
because the application is deemed to relate to all
four features of the design (shape, configuration,
ornamentation and pattern) unless specified in a
statement of limitation. Designs no longer need to be
shown applied to a finished article. Applications are
no longer limited to a single environmental
- A new provision allows a
divisional application to be filed for any design
disclosed in a previously filed application,
including in environmental views.
- An applicant no longer needs to
provide signed authorisation to appoint an agent. The
previous requirement to have a representative for
service, in the case of foreign applicants, has been
- The Regulations contain specific
provisions that apply only to international
registrations that designate Canada and that are
received from WIPO.
The USMCA will not require too many changes on the trade
mark side of IP. As a result of Canada's 2016 trade deal with
the EU and other past agreements, amendments to update and
expand Canada's Trade-marks Act are already underway, and are
slated to come into force in early 2019.
It is still unclear whether any big changes will be needed.
But some minor changes will be required for Canada to comply
with the USMCA. First, it will need to implement statutory
damages for trade mark infringement, which IP practitioners
believe was long overdue.
Second, Canada must now recognise collective marks as a
distinct type of mark, which will require an amendment to
Canada's Trade-marks Act. Certification marks already exist in
Canada. These focus on quality and standards, whereas
collective marks are about distinguishing members from
Lastly, measures for handling counterfeits at the border
will be strengthened by the USMCA. Previously, infringing goods
were only detained at the border when rights holders filed a
request for assistance, and were only able to be destroyed when
a court found them to be infringing.
Compliance with the USMCA will allow Canadian Customs to
detain and destroy goods that have been determined to be
infringing by "competent authorities," which could include
customs officials themselves.
There are varying implementation deadlines for each part in
the USMCA. For example, there's a five-year implementation
period for the biologics data protection term change, while the
period for implementing the patent term adjustment system is
four-and-a-half years. Changes to copyright rules must be
implemented within only two-and-a-half years.
The reason for the difference is unclear, but more time
allows for continued negotiation and a softer transition. If
the Agreement is ratified by the US, Mexico, and Canada by the
end of November, as expected, this will start the clock on the
various implementation periods.
In the meantime, IP practitioners in Canada are left
reflecting on the big impact the USMCA will have on their