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Canada needs to do more in the fight against counterfeit goods

One of U.S. President Donald Trump's latest executive orders calls on his cabinet to step up enforcement of his country's trade laws, including the rules designed to battle the import of counterfeit goods.

It's a shot across the bow of China, the source of one-third of the world's fake cellphones, chargers, video-game consoles, computer components, DVDs and other bogus electronics, according to a new report from the Organization for Economic Co-operation and Development (OECD).

But it can also be seen as a message to Canada, which the OECD lists as one of the world's top five producing countries and transit points for counterfeit electronics.

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The U.S. and other countries have a longstanding grievance with Ottawa on this issue. Canada responded in 2014 with the Combatting Counterfeit Products Act, which made it simpler for intellectual property rights holders to work with the Canada Border Services Agency on the seizure and destruction of counterfeit goods.

But the U.S. wanted the new law to go farther and give CBSA agents the power to search for and seize bogus goods that were in transit through Canada on their way south. The minister of trade at the time said Canada had no intention of acting as Washington's customs agent.

Ottawa should revisit that stance. The OECD points out that 66 per cent of the counterfeit electronics made in China, Hong Kong, India and other overseas countries are delivered to their destinations by mail or courier service. The shipments are usually small, and their routes complex, through many different countries, in order to help disguise their provenance and content.

The OECD has identified a number of countries that are popular transit points for counterfeiters. Canada is one of them. Why is that? Because the counterfeiters know their illicit goods will transit through this country unmolested since, standing on a weak principle, Canada declines to be anybody else's customs agent.

American companies are the ones most hurt by the worldwide trade in counterfeit electronics, clothing and other goods, which combined were worth as much as much as $617-billion in 2013. As America's neighbour and main trading partner, Canada should not be part of a chain of transit countries abetting this illicit activity.

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