The Grey Zone: How Various Countries Permit or Restrict Parallel Imports

Australia recently rejected a proposal to permit parallel imports of vehicles. Industry regulatory groups hailed this decision but various stakeholders were not happy.

Parallel importation refers to corporations that import non-counterfeit goods but these corporations are not the trade-mark or copyright owners. As one can imagine, this is a controversial practice. Some argue that parallel importation increases competition and reduces prices. However, critics argue parallel imports are risky and untrustworthy. The World Trade Organization takes no position on parallel imports.

Like Canada, Australia is a common law jurisdiction. How does Canada react to parallel imports? The Canadian government takes a slightly different approach to parallel imports than Australia. Parallel importation of books constitutes a violation of Canada’s Copyright Act but the Canada Border Services Agency will not enforce requests for assistance, which are used to fight counterfeit goods, against parallel imports. In Euro-Excellence Inc. v Kraft Canada Inc., the Supreme Court of Canada ambiguously ruled that a licensee of a copyright could not claim secondary infringement against chocolate bars that were parallel imports.

Canada and Australia’s differences highlight intellectual property law’s jurisdiction-specific nature. While there has been increased international harmonization of intellectual property standards, differences between countries remain.

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