Vol. 144, No. 8 — April 14, 2010

Registration

SOR/2010-74 March 25, 2010

CRIMINAL CODE

Regulations Amending the Regulations Excluding Certain Indictable Offences from the Definition of “Designated Offence”

P.C. 2010-394 March 25, 2010

Her Excellency the Governor General in Council, on the recommendation of the Minister of Justice, pursuant to subsection 462.3(2) (see footnote a) of the Criminal Code (see footnote b), hereby makes the annexed Regulations Amending the Regulations Excluding Certain Indictable Offences from the Definition of “Designated Offence”.

REGULATIONS AMENDING THE REGULATIONS EXCLUDING CERTAIN INDICTABLE OFFENCES FROM THE DEFINITION OF “DESIGNATED OFFENCE”

AMENDMENT

1. Paragraph 1(c) of the Regulations Excluding Certain Indictable Offences from the Definition of “Designated Offence” (see footnote 1) is repealed.

COMING INTO FORCE

2. These Regulations come into force on the day on which they are registered.

REGULATORY IMPACT
ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Issue and objectives

These Regulations amend the Regulations Excluding Certain Indictable Offences from the Definition of “Designated Offence” (the Regulations).

This amendment to the Regulations will play a role in supporting the enforcement of copyright law and will have a positive impact in strengthening Canada’s intellectual property regime. The initiative meets with Canada’s commitment to the Financial Action Task Force to include copyright offences as a predicate offence in respect of money laundering.

In the past several years, the scope and nature of copyright piracy have grown. Canada has come under pressure from industry stakeholders to take concrete action to better protect intellectual property rights (IPR), including copyright, a view that was echoed in two all-party reports from the Standing Committee on Public Safety and National Security and the Standing Committee on Industry, Science and Technology in 2007. Responses tabled October 17, 2007 reaffirmed the Government’s commitment to pursuing strategies to better address IPR issues. The level of sophistication by organized criminals as well as the available technology to commit acts of copyright piracy continues to grow and has compelled law enforcement and industry representatives to seek the application of the Criminal Code’s confiscation regime to proceeds derived from criminal infringement of copyright.

In Canada’s 2007 evaluation of its anti-money laundering and terrorist financing measures by the Financial Action Task Force, Canada was criticized for not permitting the confiscation of proceeds from the commission of criminal copyright infringements.

Description and rationale

The amendment to the Regulations removes the Copyright Act from the list of statutes that are excluded from the definition of “designated offence” in relation to the application of the “proceeds of crime” provisions of the Criminal Code.

Part XII.2 of the Criminal Code dealing with proceeds of crime permits courts to order the confiscation of such proceeds, that is, of property derived from the commission of certain offences. Prior to 2001, the provisions applied only to a list of some 40 indictable offences associated with organized crime. In 2001, Part XII.2 expanded the application of the proceeds of crime provisions to all indictable offences captured by the definition of “designated offence.” “Designated offences” comprise all indictable offences under the Criminal Code and other Acts of Parliament, with exceptions that are prescribed by regulation. The purpose of this expansion was to enhance the ability of law enforcement authorities to seize, restrain and have forfeited the profits obtained through a wide range of criminal activity. Parliament concluded that expanding the application of the proceeds of crime provisions beyond offences traditionally associated with organized crime provided for greater consistency in the treatment of the benefits obtained by crime, enhanced effectiveness for overall law enforcement, and at the same time strengthened the ability of law enforcement to target the profits of the growing range of criminal activity that is linked to or facilitated by organized crime.

The Regulations were first made in 2002. Under the Copyright Act, a copyright owner is able, pursuant to section 35 of the Act, to claim damages and profits from infringers. Because of a concern that the application of the proceeds of crime provisions could undermine a copyright owner’s ability to recover damages and profits in a potential civil action that may be launched for copyright infringement, the Copyright Act and its offences were excluded from the application of Part XII.2. However, experience has shown that very few civil claims against criminal infringers have been made. Indeed, representatives from the intellectual property industry have sought to have the Criminal Code’s confiscation of proceeds regime apply to the proceeds obtained from the commission of copyright offences.

With this amendment to the Regulations, the law enforcement community’s ability to target intellectual property infringements will be enhanced, which is inherently beneficial to the intellectual property community and to all Canadian society.

Consultation

A number of representatives from intellectual property fields, including representatives from the Alliance of Canadian Cinema, Television and Radio Artists; the Canadian Film and Television Production Association; the Canadian Motion Picture Distributors Association; the Entertainment Software Association of Canada; the Canadian Recording Industry Association; and the Music Industries Association of Canada, have requested this amendment to the Regulations. This amendment was also echoed in reports from the Standing Committee on Public Safety and National Security and the Standing Committee on Industry, Science and Technology in 2007. A number of federal departments and agencies were also consulted, including the Royal Canadian Mounted Police. All who were consulted support this amendment.

Pre-publication

The amendments to the Regulations Excluding Certain Indictable Offences from the Definition of “Designated Offence” were published in the Canada Gazette, Part I, on October 31, 2009, followed by a 30-day public comment period ending on November 30, 2009.

Written comments were received from four correspondents, all representing stakeholders in the intellectual property industry. All of the correspondents indicated their support for the amendments.

No changes were made as a result of the comments received.

Implementation, enforcement and service standards

Prior to this amendment, proceeds derived from the commission of copyright offences could not be seized, restrained or confiscated under the proceeds of crime confiscation regime. This amendment allows such proceeds to fall within the ambit of the Criminal Code’s proceeds of crime regime. Accordingly, it improves the ability of law enforcement agencies to enforce the Copyright Act by permitting the seizure, restraint and confiscation of proceeds derived from the commission of copyright-related offences. It complements existing enforcement strategies to combat organized crime and copyright piracy.

Contact

Paul Saint-Denis
Senior Counsel
Criminal Law Policy Section
284 Wellington Street
Ottawa, Ontario
Telephone: 613-957-4751

Footnote a
 S.C. 2001, c. 32, ss. 12(7)

Footnote b
 R.S., c. C-46

Footnote 1
 SOR/2002-63

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