IP policy doesn’t affect trade.
Richard Owens, 24, Senior Munk Fellow @ the Macdonald-Laurier Institute, professor @ the University of Toronto Faculty of Law, "Intellectual property protection the path to a more productive Canadian economy: Richard Owens in the Financial Post", Macdonald-Laurier Institute, 7-8-2024, https://macdonaldlaurier.ca/intellectual-property-protection-the-path-to-a-more-productive-canadian-economy-richard-owens-in-the-financial-post/. Accessed 7-8-2024 by NT-JJ. I don’t know who originally found the article but they left it uncited and uncut and untagged so I did all of that. Insufficient protection of IP hurts trade. Canada, for instance, remains on the U.S. Trade Representative’s “special 301” report, a list of IP malefactors belonging more to the likes of Venezuela and China than an advanced economy like Canada. We deserve that censure and should address these unnecessary trade irritants.
We decry the lack of investment in pharmaceutical sciences in Canada, while having one of the worst environments, if not the worst environment, for pharma and life-sciences patents in the OECD. Our peculiar and heavy-handed “utility” requirement for patents has resulted in the invalidation of approximately 30 patents for drugs, patents which were valid in other jurisdictions. We have no patent-restoration term, to extend the life of a patent for delays in marketing approval for a drug. We have eight-years’ data exclusivity (during which a generic competitor cannot use an innovator’s proprietary data to seek market approval), instead of the standard 10. Unfortunately, while we talk a good game about innovation, we are half-hearted about it, particularly if we see rising health costs on the horizon.
It should be no surprise that most of Canada’s technology businesses are small- and medium-sized enterprises (SMEs). Technology businesses the sizes of BlackBerry and Nortel are few and far between in this country. And research clearly shows that SMEs rely more on IP rights than larger companies do, for a variety of reasons. They don’t have access to goodwill and economies of scope and scale like larger companies do. They rely on the assertion of rights to withstand often unprincipled competition from larger firms. Clear IP rights help SMEs thrive by facilitating contractual dealings — and, when necessary, infringement actions.
Another advantage of strong IP rights is that they greatly encourage foreign direct investment, which brings with it proprietary technologies which then disseminate through the economy, by licensing and worker training.
Often cited in defence of weaker IP rights is Canada’s balance of trade in IP. Some fear net outflows of royalty payments — to the U.S., for instance. There is no basis for such fear. First, Canada’s balance of trade in copyright goods and services is positive. It is only slightly negative in patent-protected technologies. Moreover, balance of trade reflects consumer choice more than structural economics. It is no basis for IP policy. And even if there were a negative balance of trade, would that really argue for expropriation of IP rights at the border any more than for confiscation of other trade goods?
Stronger IP rights are entirely to Canada’s benefit. It is time to move forward with building an IP strategy that serves our needs.