When an intellectual property right becomes an intellectual property wrong: re-examining the role of Section 32 of the Competition Act.




Nouri, Soudeh N.

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Intellectual property rights (IPRs) are becoming increasingly important due to their inevitable link to technology and economic development. This highlighted role has resulted in the emergence and development of over-protections that are beyond the ideal scope of IPRs. As the scope of IPRs expands, competition concerns are also intensifying and, as a result, the interface between IP and competition law is expanding in new directions. To address these new developments, trans-Atlantic jurisdictions have developed new policies based on the general provisions of their competition laws. Canada’s current policy toward the IP/competition law interface is affected by the existence of a unique section in its Competition Act, section 32, which directly refers to the anti-competitive usage of IPRs. Despite section 32’s long presence in the Act and its role as a basis of the Competition Bureau’s analysis of the IP/competition law interface in Canada, this section has not been judicially considered to date. This thesis re-examines the role of section 32 and explores some of the reasons behind its current obsolescence. The main claim of this thesis is that the current interpretations of the role of section 32 are not as broad as envisaged in the statute. On the one hand, the Competition Bureau’s interpretation in the Intellectual Property Enforcement Guidelines (IPEGs) limits the scope of section 32 to the unilateral refusal to license IPRs. The approach that the Bureau has adopted toward the unilateral refusal to license is more in line with the American restrictive approach, which allows very limited scope for competition law interventions in the IP realm. From the author’s point of view, such a restrictive approach is not consistent with the underlying principles of Canadian competition policies. On the other hand, section 32 has not been amended since 1935. This has led to the generation of some procedural restrictions in the application of this section. The author claims that the procedural requirements of section 32 need to be amended in order to parallel the modernization of the Competition Act that has occurred over the last few decades.



Intellectual Property Right, Competition Law, Interface, Canada, Section 32