Once again, Canada appears near the top of the US government's 2010 "Special 301" piracy watchlist. And once again, the Canadians are angry about being classed with China and Russia as the worst places on earth for intellectual property law.

Michael Geist, a prominent Canadian academic at the University of Ottawa law school, slams the report for "bullying" and being long on rhetoric but short on facts. According to Geist, Canada's reputation as a piracy haven simply isn't accurate:

According to the software industry's own piracy numbers, [Canada's software piracy] rate is declining and is dramatically lower than any other country on the priority watch list. Moreover, even the Business Software Alliance has characterized Canada as a "low piracy country."

According to the recording industry's own numbers, the Canadian recording industry did not decline last year as badly as the US or Japan and it ranked well ahead of the global average for digital music sales growth.

According to the motion picture industry, illegal camcording has declined rapidly in Canada in recent years. Canada is one of the only countries in the world with criminal convictions for such activities.

Canada is often characterized as a prominent home for BitTorrent sites, yet there are more sites hosted in European countries such as the Netherlands not included on the list.

Canada is the only participant in the Anti-Counterfeiting Trade Agreement to be named to the Priority Watch List. Apparently, our involvement in those talks counts for little.

Canadian copyright lawyer Howard Knopf, also no fan of the Special 301 process, agrees that Canada gets a bad rap for bad reasons. In fact, he argues, Canadian copyright law is much stronger than US copyright law in at least 21 ways. Here are a few:

Canada has a rich blank media levy scheme that has generated nearly $300 million overall to date, most of which will wind up in the USA. Artists see at most about an average of $160 per year of this—and probably much less in reality on an average basis. The US has never had anything comparable.

Canada has no parody right/exception for creators and users. In fact, the Canadian Federal Court has explicitly ruled against such a right. On the other hand, the US Supreme Court has confirmed such a right.

Canada has no time shifting exception that would clearly allow for legal use of DVRs/PVRs such as the TIVO in Canada. The US has had this since the 1984 Betamax decision from the US Supreme Court. Recent US jurisprudence in the Cablevision case has extended this user right and this technology into “the cloud.”

Canada has crown copyright, which leads to all kinds of unnecessary costs and complications for those ranging from advanced researchers to fishermen, who should be able to depend on mapping and GPS information for life saving purposes from the government and not privatized for profit parties. Canada privatizes its government copyright for profit, which cannot happen in the USA.

As for the whole premise of the Special 301 report, people like Geist have been railing against it for years. In a 2007 paper (PDF), Geist argued that the process is merely political and is driven by special interests. If it had any real basis in international law, the annual report would look quite different.

"While the USTR report and its supporters seek to paint many countries as laggards on copyright," he wrote, "this rhetoric ignores the fact that many of those same countries are compliant with their international obligations. In fact, of the three highlighted issues (WIPO ratification, copyright extension, and camcording), only three of 192 United Nations members—the US, Singapore, and the Czech Republic—have completed all three reforms.

"Indeed, once the sound and fury behind the Special 301 report are stripped away, it becomes apparent that few countries respond directly to the US lobby effort, recognizing that no country should be in a rush to become the fourth country on that list. The USTR may dole out many failing grades, but the real failure lies with countries that cave in to such bullying by enacting laws that are not in their national interest."

Knopf concludes: "The real danger is that well meaning but nonexpert officials and politicians on both sides of the border and even in other countries may be influenced by inaccurate and/or misleading findings by the USTR resulting yet again from the incessant spin, propaganda and lobbying at any cost by certain U.S. dominated industries. One has to ask what financial return is expected by these industries to justify the clearly enormous spending on Canadian and American lawyer/lobbyist and other high-profile activity."

Indeed, these assessments were echoed in the US by the CCIA, a trade group that counts Google and Microsoft among its members. In its filing to USTR, CCIA argued (PDF) that keeping Canada on the Priority Watch List "would undermine Special 301 credibility."

One of the key reasons given for including Canada on the watchlist is its failure to ratify the 1996 WIPO Internet treaties (treaties which led directly to the DMCA in the US). As CCIA notes, "Moreover, watch-listing one nation for nonratification of the WIPO Internet treaties would seem to require watch-listing all non-members of the WIPO Internet treaties. The European Union, for example, only just ratified the Internet treaties late in 2009, and by such logic was presumably as much a haven for pirates as Canada until that time."