Grand Committee
(11 years, 9 months ago)
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Enterprise and Regulatory Reform Bill
(11 years, 9 months ago)
Grand CommitteeRead Full debate Read Hansard Text
The Deputy Chairman of Committees (Baroness McIntosh of Hudnall)
My Lords, I remind the Committee that in the event of a Division in the Chamber the Committee will adjourn for 10 minutes from the sound of the Division Bell.
Amendment 28C
Lord Jenkin of Roding
“Director General of Intellectual Property Rights
(1) The Copyright, Designs and Patents Act 1988 is amended as follows.
(2) In Part VII (miscellaneous and general) at the beginning insert—
“Director General of Intellectual Property RightsA296 Director General of Intellectual Property Rights
(1) The Secretary of State shall appoint an officer to be known as the Director General of Intellectual Property Rights (“the Director General”).
(2) The Director General has a duty to—
(a) promote the creation of new intellectual property,(b) protect and promote the interests of UK intellectual property rights holders,(c) co-ordinate effective enforcement of UK intellectual property rights, and(d) educate consumers on the nature and value of intellectual property.(3) In performing those duties, the Director General must also have regard to the desirability of—
(a) promoting the importance of intellectual property in the UK,(b) encouraging investment and innovation in new UK intellectual property, and(c) protecting intellectual property against infringement of rights.””
Lord Jenkin of Roding
My Lords, this proposed new clause calls for a new appointment of a director-general of intellectual property rights.
More than a year ago I started to be approached by a number of bodies, individuals and organisations who voiced their fears about threats to their rights as owners of intellectual property. I held discussions with representatives of publishers from the music industry, the Authors’ Licensing and Collecting Society and a number of others, including those representing designers. I attended a number of meetings where these fears were voiced with increasing intensity and became convinced of the need to ensure that the then projected legislation really did protect the owners of all kinds of IP.
I was interested to read a biography of my great-grandfather recently, who was a distinguished 19th century engineer—the first professor of engineering at Edinburgh University. He and Sir William Thomson, Lord Kelvin, had considerable battles with financiers and others to ensure that they enjoyed the fruits of their inventions by means of patents, which are simply another form of intellectual property. Therefore, my interest in these matters may be to do with my genes.
I have also listened to the strong case for what is called open access: that is, the policy of enabling free access to the results of publicly funded research and other similar sources. This is strongly supported by my right honourable friend the Minister for Science, David Willetts. I remind noble Lords what he wrote in his article in the Guardian last year. The article stated that,
“we will make publicly funded research accessible free of charge to readers. Giving the people the right to roam freely over publicly funded research will usher in a new era of academic discovery and collaboration, and will put the UK at the forefront of open research”.
He added:
“The challenge is how we get there without ruining the value added by academic publishers”,
and, of course, many others. We know that in the other place an amendment was made to the Bill which protects those who publish the results of such research. However, my right honourable friend described this change in open access as a “seismic shift”. The policy covers research councils, universities, libraries, archives and museums. It also covers electronic publications from these sources.
I must make it clear that I warmly welcome this open access policy which seems to me to have a great deal of merit. However, I must, of course, mention the challenges to which my right honourable friend referred. I have been made aware that major commercial interests, many of them in the electronics industry, especially the interactive sources, find the obligations to respect copyright a tiresome and expensive barrier to their business. They appear to claim that they, too, create public benefit and that the privileges of open access should be extended to them as well. Their solution has been to argue strenuously for relaxation of the terms and application of copyright, and some of those arguments are reflected in the Bill. We are faced with the need to reconcile legitimate open access with the essential protection of the rights of the creators of intellectual property. That may be something of a simplification, but we will have ample opportunity to explore that as we go through the rest of the Bill. I must make it clear that I do not wish to trespass upon the debate we shall have on the many particular policy issues dealing with exceptions and orphan works, collective licensing, codes of conduct and the ombudsman, which are all subject to later amendments that deserve very thorough scrutiny.
It is where other interests see this as a route to circumvent the constraints of copyright and other legal protections for property rights—and I assert very firmly that they are property rights and have been seen as such by the courts for very many years—that the conflicts lie. I start by quoting and endorsing the statement by the Alliance for Intellectual Property. It is a long statement, but I will quote only the essential paragraph:
“IP lies at the heart of every British success story. It is essential to the creative industries which support around 1.5 m jobs, contribute over £36 billion to UK GVA (DCMS Creative Industries Economic Estimates). IP is also the basis for the £16 billion which companies invest annually in the UK economy by building brands, and allows the UK’s brand-building industries (including advertising, marketing and design agencies) to generate around £1 billion in Gross Value Added through exports alone. In addition, the design industry employs up to 350,000 people and UK businesses spend around £35 billion on design each year”.
We are not talking about fringe businesses. This lies right at the heart of a great deal of British industry. It is a powerful case, and I have to say to the Minister that I am not wholly satisfied that the Government recognise the strength of that case.
An example of the very real concern that the threat to copyright, including design, patents et cetera, has engendered, was a letter sent to the Times last March signed by members of the Creative Coalition Campaign.
“Copyright is the central intellectual property right that underpins the creative and knowledge economy. Films, music, games, books, could not get made in their present quantity and quality without a robust system of copyright. It provides the legal foundation for the ability of companies to license or sell works, and to invest and innovate”.
There have been other statements as well.
I am sure that noble Lords are aware that on 29 October last, the All-Party Parliament IP group produced a report, The Role of Government in Promoting and Protecting Intellectual Property, which urged the Government to get a grip on how IP policy is made. My honourable friend John Whittingdale, the chairman of the committee, said in a press release:
“The current system of creating intellectual property policy just isn’t working. IP needs a champion within Government, who will recognise its significance and who will have the influence to co-ordinate policy across different departments. From trademarks to patents, design rights and copyright, UK companies depend on their IP rights to succeed and thrive. In this difficult economic climate it’s especially important that Government backs British businesses on IP. We hope that Government will take note of our proposals”.
It was a fairly hard-hitting report, which made the point that the Intellectual Property Office had lost,
“the confidence of a broad swathe of its stakeholders”.
I come to Amendment 28C, which picks up on the group’s call for a champion of IP, calling for the creation of a new post, the director-general of intellectual property rights, a duty to promote the creation of IP and to protect it where it exists. I know that noble Lords will already have studied the amendment, which says in proposed new subsection (2):
“The Director General has a duty to … promote the creation of new intellectual property … protect and promote the interests of UK intellectual property rights holders … co-ordinate effective enforcement of UK intellectual property rights, and”—
this is a very important one—
“educate consumers on the nature and value of intellectual property”.
I add that as an important one, because it is clear that quite a lot of the public think that it is perfectly all right to download all sorts of things on to their computers and telephones without paying for it—because there it is, after all, and they will not be found out. That is the essential of what the amendment points out.
The committee referred to the IPO as having lost the confidence of its stakeholders, but the IPO has an entirely different function, as was made clear by the evidence that it gave to the all-party group. Some of us have had the privilege of listening to people from the IPO in the meetings that we have had. The plain fact is that the IPO may be an efficient registration body for the registration of IP rights, but it is not and never has purported to be a champion of IP. On the contrary, it sees its role as holding the balance between creators and users. This view is reinforced by the general terms of the report, Modernising Copyright, published on 20 December last year and announced by the right honourable Vince Cable when he launched the report. It declares its intention to safeguard the rights of IP creators, but almost every single one of the changes recommended points in the opposite direction. For instance, there should be more exceptions to copyright allowing access without paying. There are many other examples, which we shall no doubt deal with in the respective amendments. Much of the rest are simplifying where practice and confusion have reigned and uncertainty has become rife.
The creators and owners of IP must have someone in government to speak up for them, and that is what the amendment is intended to establish. Since I tabled it, two or three weeks ago, I have been astonished by the wide support that it has attracted. It is seen by a great many of the bodies that represent the creative industries as something that really makes sense.
I referred earlier to the Alliance for Intellectual Property and I also cite the BPI, which represents the British recorded music industry. They ask noble Lords to support the amendment arguing that the director-general should be accountable for ensuring a framework for IP that promotes investment in new content, protects the investment from theft and counterfeit and educates consumers on the importance of UK intellectual property to jobs, growth and export strength to the United Kingdom. There is also the Creators’ Rights Alliance, which speaks for some 14 bodies, including writers, illustrators, picture libraries, composers, journalists, musicians and many others.
Whatever the IPO and my noble friend’s department may say, this widespread demand for a champion for IP seems to have gained a great deal of support. It must not be swept aside. Of course, we will not be voting today because one does not vote in Grand Committee, but this is one of the most important amendments before the Committee. I beg to move.
Lord Clement-Jones
My Lords, I will speak first to Amendment 28C and then to my own Amendment 28D. I support the amendment proposing a director-general of intellectual property rights, put forward so eloquently by my noble friend Lord Jenkin. I was extremely interested to hear about his Scottish connections, his great-grandfather and his relationship with Kelvin. There was a programme recently on the BBC about innovation that described how Matthew Boulton, James Watt's partner, succeeded in making sure that Watt derived benefit from his inventions and the modifications that he made to the Newcomen engine. It must be one of the few cases where innovators and inventors received a proper reward for their inventions. That was heartening. Perhaps it was as a result of Matthew Boulton's commercial enterprise that the Scots have been so inventive over the past couple of centuries.
As my noble friend mentioned, the UK is a world leader in intellectual property. He put some significant figures forward in terms of employment and the value of the creative sector. Therefore, how the Government develop IP policy is vital for our economy. We hear much about becoming a knowledge-driven economy. IP is vital for that and for those whom it supports, such as in manufacturing.
There is concern, however, extremely well reflected by my noble friend, that the IPO is not in fact a champion of intellectual property. I was a member of the All-Party Parliamentary IP Group inquiry into the IPO. From the evidence that I saw, officials did not see their role as being to champion intellectual property. Indeed, officials found it difficult to describe intellectual property as a property right even though nearly all creators believe that fundamentally. In fact, there were three important conclusions. My noble friend mentioned them but they bear repeating: IP is a vital foundation of economic growth, there is no champion of IP policy within government and that the IPO's policy-making function has lost the confidence of a large number of its key stakeholders. That is pretty unusual. The third point bears repeating as it is a very important conclusion.
It is significant that in their paper last year on the role of the IPO, the Government came to certain conclusions, which I think bear quotation:
“In coming to this conclusion, he”—
Hargreaves—
“argued that intellectual property policy had been insufficiently directed towards the objective of economic growth and that there had been instances in which IP policy had been developed in ways that were inconsistent with the economic evidence”.
Noble Lords can see the thrust. They continued:
“To improve the focus of IP policy on growth, the Review proposed that the Intellectual Property Office, as the Government body responsible for advising Ministers on the development of IP policy, should have an overarching legal mandate to promote innovation and growth, and state that IPO decisions will be based in evidence and take due account of the impact of the IP system on innovation and growth”.
I should say in parenthesis that your Lordships will note that there is no statement about the importance of intellectual property in the middle of that statement about innovation and growth. They go on:
“The Government wishes to retain the current structure of the IPO as an Executive Agency, combining practical experience of the IP system, gained through rights granting and advisory services, with policy responsibility. There are advantages in maintaining an organisation which has a blend of technical expertise and policy development skills, and the development of policy should not be done at arm’s length from Ministers”.
That was the major conclusion—that the IPO would pretty much stay as it is, with a stronger emphasis on innovation and growth.
Some of this is disappointing, especially in the light of the kind of proposal that we have here, but it is also fairly breathtaking. I shall not dwell on those comments unduly but the fact is that, as was recently demonstrated by Professor Hargreaves before the Culture, Media and Sport Select Committee, the evidence base for his own reports has been flimsy at best when justifying certain copyright exceptions. The impact assessments for most of the relevant clauses in this Bill are also wholly inadequate as a result. The mantra that somehow copyright is a barrier to innovation and growth runs through the Hargreaves report and the work of the IPO, I am afraid.
Let us contrast that with the recent report on access to finance for the creative industries by Ian Livingstone, which is very positive about the need to recognise and build on the value of creative content. He fully recognises the benefit derived from promoting the creation and retention of intellectual property, alongside finance, skills creation and other factors.
Therefore, I hope—especially in the light of this amendment—that the Government will rethink their approach to intellectual property policy. As the feasibility studies by Richard Hooper and the work thereafter show, ambition within the UK’s collective licensing bodies and the creative industries to form hubs with other copyright owners—for example, for licensing music for services of every kind—right across the globe, making the UK a global licensing centre, really does exist to a powerful degree. The UK’s collective licensing bodies are investing in the technical expertise, processing power and administrative efficiency to handle billions of uses of music and other intellectual property, and to charge, collect and distribute income with precision.
I believe that that is of far greater significance across the board in the technology sector and the creative industries than the copyright law reforms proposed, whether in this Bill or in the proposed exceptions put out before Christmas. The Government should match this ambition and champion IP as much as possible. The IPO clearly needs to be more overtly a champion for IP. The United States has obviously benefited from having an IP tsar, otherwise known as the Intellectual Property Enforcement Coordinator, who is responsible for a national strategy and works directly to the White House. Creating a director-general of intellectual property rights to sit within the Intellectual Property Office and serve as a champion of IP rights within and across government would increase the influence of the IPO across government and also strengthen the hand of the Minister responsible for IPO, if I may say so to my noble friend.
My noble friend quoted the Alliance for Intellectual Property and I should like to take another quotation. It says:
“We believe such a post is needed to ensure that this success is properly recognised, celebrated and built upon to ensure its contribution to growth, employment, culture and society is properly maximised; for IP to be championed in a way it is in other nations”.
Statutory underpinning of the IPO will give British IP-based industries the confidence that they need both at home and abroad.
Turning to Amendment 28D, as I mentioned, one of the most significant developments—in my view, far more significant than changes to copyright law—is the work following from Richard Hooper’s feasibility studies into a digital copyright exchange, otherwise known as the digital hub. Now the work following that feasibility study has been entrusted to a broadly representative voluntary group, the Copyright Licensing Steering Group. That has proved to get buy-in right across the creative sector. It is important to have an annual report on the follow-up to Professor Hooper’s recommendations and the progress made by the group in streamlining copyright licensing. He refers to that in paragraph 167 of his final report. We need to keep momentum going: how? He sets out several possibilities, but the one that I am attracted by is his fourth recommendation:
“Industry and the Government could also look at whether there is any productive and cost-effective overlap between reporting on and monitoring all the work described in this final report and Ofcom’s reporting requirements under the Digital Economy Act. This approach has the advantage of an independent voice but the disadvantage of perhaps moving away from the industry-led and industry-funded philosophy underpinning all this work. Given Ofcom’s new role in relation to copyright enforcement this may be an important idea for industry to consider given their concerns about copyright enforcement not being forceful enough”.
That is one suggestion; there are others; but they all surround the need to keep the momentum going and have a proper report to Parliament about progress on licensing. There is support for that approach from the Government’s paper on the role of the IPO that I mentioned previously. It states:
“The Government therefore considers that the most effective way of strengthening the IPO’s focus on innovation and growth would be to require it to report annually on the extent to which its activities had promoted those two ends. This increased transparency would act as a powerful incentive to develop policy based on the best available evidence, and to be clear about the respective weightings given to economic and social impacts on individual policy issues. Where the data are not as robust as we might like, a requirement to report will act as a spur to improve the quality of evidence”.
Surely, what is sauce for the goose is sauce for the gander in that respect.
I close by citing some very wise words from the closing paragraphs of the second Hooper feasibility study. I think that they apply across the board to both amendments.
“In conclusion, the political dimension of our work, introduced in our first report, remains constant: if the creative industries ensure that they have done all they can to make licensing and copyright work easier for rights users and therefore consumers, then the ball is firmly at the feet of politicians to ensure appropriate measures are in place to reduce the incidence of copyright infringement on the web … There must be a sensible balance between the rights and requirements of licensors and of licensees, of producers and of consumers, a balance that is beneficial to both parties leading to further and sustained growth and innovation in the UK creative and internet industries … But intellectual property across copyright, trademarks, design rights and patents is at the heart of the success of a modern knowledge-based economy it must be sensibly protected against theft and improper use”.
Amen to that.
Baroness Buscombe
My Lords, I have added my name to Amendment 28C, following my noble friends Lord Jenkin of Roding and Lord Clement-Jones. It was interesting to hear from my noble friend Lord Jenkin about his genes. It made me think about my genes, and my grandfather, who invested a great deal of time, energy, love and passion in developing motor racing cars back in the 1950s and 1960s. I remember as a young child the privilege of being able to stand within what we called the works to watch those incredible machines being built. That was wonderful. The specifications used to build those machines, and their protection, were paramount to their success as flagship examples of British industry, for jobs, investment and advancement of technology within the motor industry and the motor racing industry. Of course, the principles that were clear then, in the 1950s and 1960s, are no different today. The protection of copyright is crucial for certainty. Everybody involved in the creative industries needs certainty. Often, as we know, people in the creative industries are taking enormous risks—very often on their own—whether they are a lone photographer or a filmmaker or a record company representing multiple interests.
Lord Smith of Finsbury
My Lords, I support very strongly both the new clauses in front of us, but especially that proposed in Amendment 28C. I declare an interest as a non-executive board member of PPL, the collecting society for broadcast music rights, and also a rather minor member of the Authors’ Licensing and Collecting Society. I have one even more important interest and that is as a passionate believer in the importance, economic value and the future of the creative industries in this country. Intellectual property and the copyright that protects the value of that intellectual property are at the very core of the economic importance of those creative industries.
The creative industries represent something like 7% or 8% of our GDP these days. Even at a time of recession they remain strong and, in many respects, growing. They are incredibly important for us as an advanced industrial country because they are where much of our wealth creation is going to come from over the years and decades ahead.
For the creative economic sector, intellectual property is where that wealth resides. We have to make sure that we protect and nurture that intellectual property securely. That is why having a champion for the value of intellectual property such as is proposed in the amendment would be transformative in ensuring that our Government, Parliament and the world in general take intellectual property more seriously than they sometimes do at the moment.
Sadly, the report from Professor Ian Hargreaves was deeply disappointing in this respect. It contained a number of serious flaws and was based on flimsy evidence. The report from Richard Hooper was considerably better. I hope that the Government will take forward many of the proposals from Richard Hooper's report rather than placing too much reliance on the Hargreaves report.
Having a champion for intellectual property rights would be of great importance and great value. I do not think that the IPO could do it. The IPO is part regulator and part registrar. Its job has not until now been seen as being a promoter of the value of intellectual property. If the Government said, “We do not need a separate director-general: we will give this duty to the IPO”, I confess that I would be deeply worried. The work of the IPO has fallen down in much of its analysis and work recently. We have only to look at the glaring errors, for example, in its recent Collecting Societies Codes of Conduct document to see that it would not necessarily be the right place to put this responsibility.
Having a director-general with this very specific task, with a direct line through to Ministers, would be a far better solution for this vital section of the UK economy. We need the advocacy—the championing—that can come from such a role.
Lord Howarth of Newport
My Lords, I enter a note of caution. I feel as strongly as everyone else about the importance of intellectual property—that we should generate and protect it. That is a key dynamic of our economy and our creative economy in particular. However, I have some reservations about the proposition, as framed by the Alliance for Intellectual Property and as developed and powerfully articulated by the noble Lords, Lord Jenkin and Lord Clement-Jones, and the noble Baroness, Lady Buscombe. It seems to me that the specific remit of the proposed director-general of intellectual property rights as set forth in the amendment is insufficient and unbalanced. I am not opposed to anything contained within the proposed new clause, but if the Government are to create a functionary whose job it is to promote rights, it is important that the remit of that person and office should be balanced.
Everything that is proposed in the amendment for the director-general to do is directed towards advancing the interests of the creators and owners of intellectual property rights. That is fine in itself but there are also, very importantly, the interests of consumers and users. Ultimately, all of us believe that there is not a reason. If we have an appropriate regime for the promotion and protection of intellectual property rights, the whole of society will benefit, and I do not dissent from that. But in the near term or even the medium term, there are, as we know, tensions.
In the debate that the noble Lord, Lord Lucas, introduced for us as we reached Part 6 of the Bill he rightly stressed the responsibility that we all have as legislators to ensure that the new legislative regime is balanced and that the legitimate interests of all concerned are recognised. If we were to have a director-general of intellectual property, it should also be part of his duty to promote the broader public interest—something that we shall return to repeatedly in our debates on aspects of the clauses in Part 6 of the Bill.
On the other hand, if the remit of this office is as so far proposed by noble Lords, I do not see why the creators and owners of intellectual property should not themselves establish, fund and provide other support for their own champion. That would be entirely appropriate. But the role of government is all the time to seek to balance legitimate interests when they are in any degree of competition or tension. I am not against having a director-general, but further thought is needed. Perhaps a more generous and inclusive definition of the responsibilities of the director-general would be more appropriate.
The other new clause, proposed in Amendment 28D tabled by the noble Lord, Lord Clement-Jones, suggests that there should be an annual report on copyright licensing. That is an entirely good idea and I am happy to support it.
Lord Lucas
My Lords, I join the noble Lord, Lord Howarth, in everything that he said. It is important that the Government hold the ring on this. I take my views on copyright from Macaulay—it is a bargain between the producer and consumer. It is a bargain that needs to be kept balanced. A lot of good will flow from that balance. I would not have a director-general of copyright who looked after only the producers any more than I would have bank regulation that favoured only the banks. It is a matter of balance.
If we want to look at what goes wrong when the producers are in charge, we can look back at the history of the music industry and the way that it reacted to Napster. It made a mess of that. Rather than seizing on a new opportunity, it wanted to entrench its rights against the consumer. The industry was rolled over and a jolly good thing too.
Martin Mills is a hero of mine and I am delighted that he is defending copyright so strongly. I am sure that he is right in what he said, but it does not come down to a case of a lack of balance. We as a Government should feel able to enforce copyright strongly because the copyright owners are giving our people what they want—not trying to withhold stuff from them, fail to give them what they want or hold them to ransom, as was the case in that phase of the music industry.
I am entirely in favour of the amendment of the noble Lord, Lord Clement-Jones. What is being done on the copyright hub is of immense importance. I am a copyright producer and user. In both aspects I would be a keen user of the hub. It is a great chance for Britain to be at the start of this and to put ourselves at the centre. If there is anything that we as legislators can do on this to keep the Government’s foot on the gas pedal and pressed firmly pressed to the floor, we should take that opportunity.
Baroness Morris of Yardley
I support Amendments 28C and 28D, and draw the Committee's attention to my entry in the Register of Lords’ Interests as a director of the Performing Rights Society.
I listened carefully to the two preceding speakers. It is difficult to argue against a balance. Who would be against a balance in favour of a bias? But to some extent the amendments that have been presented seek to correct an imbalance that already exists. That is the problem. We are not starting from a level playing field and building in an imbalance: there is a feeling that intellectual property is not protected. The amendments seek to correct an imbalance that the two previous speakers mentioned.
A lot has been said about the importance of this industry and I shall not go over that again, but I have two points. This is probably a pivotal time in that this industry is growing, it is new and it is fast moving. We saw what happened when the sector itself failed to respond to new technology in the appropriate way 10, 15 or 20 years ago, and I think that we have been picking up the pieces ever since. However, things have moved on since then. It is right that, as a society, the Government and the industry now look at what is happening and ask, “What do we need to do to make sure that we can guarantee the future of this industry, giving people new ways of accessing music design and all those things, but protect the copyright holders as well”. Getting that right is what this legislation is about. Given how fast things are moving, if we get it wrong now, we will find it very difficult to go back and get it right again in the future. This is a really important point. In relation to this amendment, perhaps I may say to the Minister that I do not think we can see how it goes and come back in 12 or 18 months’ time to reflect and then take things forward. Now is the time to act.
Lord Stevenson of Balmacara
My Lords, it has been a very good debate, and it has got us off to a very good start this afternoon in our task to whip through the various clauses on copyright. I start where my noble friend Lady Morris ended. We have to be clear that in addressing these clauses we adjust for the realities of the digital world in a way that makes sense to consumers. We have to start with where people are at present, not where we would like them to be. The points about education are really important here.
We are playing a big price for the lack of reform in recent years from schools unable to make use to libraries unable to make preservation copies of films and television programmes that they hold in the national interest. Copyright raises issues of reasonable social and cultural freedom as well as one very key issue with economic ramifications. The presence of the internet allows all sorts of new forms of creativity, so we need a copyright set-up that encourages one-click licensing for a long tail of material that is out there and which could bring economic and cultural growth. But without a well balanced and modernised framework, we will put ourselves at a big disadvantage over some other countries, most obviously the US but also other emerging players. Countries such as Singapore and Iceland are seeking roles as leading edge players in creative product licensing.
Technological change will mean that we in the UK need to keep on adapting our rules, because our fair dealing regime is part of a European system that requires us to exploit fair dealing exceptions, rather than the US fair use system that enables the regime to flex in response to changing attitudes, behaviours and court decisions. I wonder whether the time has not come to think hard about why we differ from the US on this key point.
As we have heard, the argument for the post of director-general of IP is that such a post is needed to ensure that the successful record of IP generation in the UK is properly recognised, celebrated and built on to ensure its contribution to growth, employment, culture and society. As the noble Lord, Lord Jenkin, said, the key to that is definitely education.
The noble Viscount, Lord Younger, is the newest IP Minister, and I note that he is the sixth person to hold this position since it was created about six years ago. This will undoubtedly lead to a lack of continuity and policy uncertainty for businesses. It is not an exact parallel, but before the creation of the Department for National Heritage, which is now DCMS, there was a period when there were 18 different Ministers with responsibility for films in the then sponsoring department, the DTI, over a period of 17 years. As I was working at the BFI in part of that period, I know what that does to industry. I shall leave it to the Minister, who is barely 18 days into his post, let alone 18 years, to assess whether his location in BIS makes cross-government co-ordination more difficult and sporadic, as has been rather persuasively argued.
One problem for those working on this section of the Bill is that the creative industries do not generally feel that they are being looked after properly. Indeed, there is a wide sense of unease, as the noble Lord, Lord Jenkin, called it, and of imbalance, as my noble friends Lady Morris, Lord Smith and Lord Howarth also mentioned. This is in part because of the rather unfortunate split in responsibilities between BIS and DCMS, which can sometimes—or, indeed, all the time—appear to pull in different directions. My noble friend Lady Morris put it well; she spoke from experience, and I think that she spoke the truth. IP is not well served by the current system. But it is also because there have been no real opportunities to debate in this House and the other place some of the issues in the foreground of this sector’s thinking at a time of great change in every aspect of its businesses. The occasional SI does not compensate for this—something that we will return to in other debates. That is why, to me, the idea of an annual report and a subsequent debate in Parliament seems such a good idea, which I am happy to support.
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Viscount Younger of Leckie)
My Lords, first, as a Scot, I recognise with a little pride the Scottish historical links with intellectual property which have been highlighted today.
Amendment 28C would create a new statutory role of “Director General of Intellectual Property Rights”, with a duty to promote intellectual property rights. As Minister for Intellectual Property, I have a role to champion the IP system as a whole—a point to which I shall revert later. This system recognises the different interests of rights holders, consumers and other users—an important point raised by the noble Lord, Lord Howarth of Newport, and supported by my noble friend Lord Lucas.
A balanced intellectual property system promotes strong and competitive markets; encourages innovation and creativity; and is a foundation of the knowledge-based economy. I ask noble Lords how the proposed director-general would fit into that system. The frameworks for patents, copyright, trademarks and designs serve sets of different needs, and function in different ways. It is not clear how introducing a new duty, cutting through those distinct, complex and largely effective systems, would affect their operation.
We recognise the importance of promoting and educating about intellectual property. As my noble friend Lord Jenkin highlighted with some impressive statistics, and was highlighted by the noble Lord, Lord Smith, intellectual property is an important agenda for businesses and consumers alike, but although the Government understand the intention behind Amendment 28C, there is a need to deliver a balanced approach.
Amendment 28D would create a new obligation on the Government to report annually on the state of copyright licensing in the UK, and between the UK and our trading partners. The Government are keen to ensure that the intellectual property system as a whole works well. We have ourselves proposed that the Secretary of State will present an annual report to Parliament setting out his view on how the activities of the Intellectual Property Office are facilitating innovation and growth.
The Government agree with Professor Hargreaves that intellectual property policy should be based on reliable evidence. However, the reporting obligation created by this new clause would not be a proportionate tool to do that. Moreover, copyright licences are private agreements, and the Government do not intervene or monitor individual transactions unless circumstances are exceptional.
Collating large amounts of commercially sensitive data could also cause concern within the markets, and could have an impact on the competitiveness of UK interests. Headline figures showing the health of the creative industries are already available. It is not clear that the proposed report would add value to that existing data.
The UK’s creative industries are among the most influential and successful in the world. Our creativity is, quite rightly, highly marketable, award-winning and sought after, and creative industries contributed 2.9% of UK gross value added in 2009.
At this point, I should like to address some points raised by my noble friend Lord Jenkin and the noble Lord, Lord Smith, concerning the value of the IPO. The Government recognise the value of the creative industries, and it is worth emphasising some progress. The Government have done a lot for UK creators and are doing more. We have supported term extension for music performers; introduced charging of charities for music use; are pressing ahead with the antipiracy measures of the Digital Economy Act; and rejected the notion of introducing US-style fair use in the UK.
The Government are also supporting the creative industries abroad through our growing IP attaché network. Those attachés provide practical support to UK businesses, build relations with intellectual property agencies in host countries and improve UK influence overseas. The UK has attachés in south-east Asia, China, India and Brazil. The changes proposed in the Bill will bring the copyright framework up to date and reduce administrative burdens on both creators and users of content. My noble friend Lord Jenkin also questioned the direction and strategy of the IPO, supported by my noble friend Lord Clement-Jones, who questioned whether the IPO is indeed a champion of IP.
Lord Clement-Jones
I will respond briefly and leave my noble friend Lord Jenkin to respond to the main amendment. I welcome the fact that the Minister has come out of his corner punching. He has certainly set out the term extension, the charging charities, the anti-piracy measures, the statement by my noble friend Vince Cable about super fast patent procedures, trade mark services and so on. He has also given us a mini update on the copyright hub, which is what I asked for all along on an annual basis. I am not at all convinced by the plea that there will be lots of commercially sensitive data that would have to be included in any report on the copyright hub. I ask my noble friend whether the report on innovation and growth that the IPO is going to be tasked to deliver on an annual basis could include licensing. I believe that licensing is the way forward to innovation and growth for the content and creative industries. It is extremely important, rather than copyright exceptions. There is no reason why it should not be included in the IPO’s report and maybe that is a way of coming to a beneficial conclusion on this.
Lord Jenkin of Roding
My Lords, contrary to the figures in front of us on the chart, we have actually spent over an hour on the first amendment. I do not, therefore, want to take more time. I thank all those who have taken part in the debate. I think it justified what I said at the beginning about the level of support there is for, if not this particular amendment then the recognition that “all is not well”—to quote the noble Baroness, Lady Morris. All is not well in the field of copyright. I leave the Minister with this thought. The Government have got to do a great deal more if they are going to regain the confidence of copyright owners. I heard what he said and I shall study it carefully. However, there is no question about it, those of us who have been exposed over recent months to the considerable expressions of dismay and, indeed, fear for the future on the behalf of IP owners are left in doubt at all that, as the noble Baroness said, all is not well.
The argument of the noble Lord, Lord Howarth, for seeking balance, is probably what the IPO claims that it would be doing. The fact of the matter is that it has lost the confidence of all those who are concerned as the owners of IP. Something has to be done in order to get the improvement in the whole copyright structure that is widely sought. It may well be that the director-general proposal will need to be looked at again in the light of what has been said in the debate about it. One point I would make is that the all-party group recommended that it come under the Secretary of State for DCMS whereas the IPO comes under BIS. The amendment says “Secretary of State” and that covers all of them, so the amendment does not distinguish.
I agree with what has been said. There is a lack of co-ordination across Whitehall—a lack of the same kind of recognition of the importance of IP lying at the heart of our economy, and it will increasingly lie at the heart of our economy as it becomes even more based on intellectual property and less on manual labour. We have got to look at this very carefully. Parliament has an opportunity to express its views. I have no doubt at all that we shall want to return to the matter at Report. I give notice to my noble friend that I expect that is what we will do, but we will study what he has said very carefully. In the mean time, I beg leave to withdraw the amendment.
Viscount Younger of Leckie
Before my noble friend sits down, I hope that it is in order briefly to answer my noble friend Lord Clement-Jones and to confirm that we can include the detail on licensing within the IPO report in future.
“Metadata
(1) The Copyright, Designs and Patents Act 1988 is amended as follows.
(2) In Part VII (miscellaneous and general), after section 296ZG insert—
“296ZH Effect of electronic rights management information when material gathered by an automated process
(1) This section applies where electronic rights management information is associated with a copy of a copyright work, or appears in connection with the communication to the public of a copyright work, and a person (A) in the course of a business (including without limitation in pursuance of educational, cultural or any other non profit objectives) makes a copy of or performs any other restricted act in relation to that work by an automated process.
(2) If the conditions in subsection (3) are satisfied, A is deemed to have notice of the contents of that electronic rights management information (“the information”) for all purposes relating to his further use of, or access to, the copyright work.
(3) Those conditions are that—
(a) it is reasonably practicable for A to instruct the equipment or software which conducts the automated process to recognise, read and interpret the information;(b) the meaning of the information may be ascertained from published standards which A knows about or ought to know about;(c) the meaning of the information is sufficiently clear that it is reasonably practicable to instruct A’s equipment or software to comply with any restrictions contained in the information regarding the further use of, or access to, the copyright work.(4) Where, apart from this section, A would be regarded in law as having notice of any of the information, nothing in this section prevents A from having such notice.
(5) Subsections (1) to (4), and any other provisions of this Act as it has effect for the purposes of those subsections, apply, with any necessary adaptations, to rights in performances, publication right and database right.
(6) Section 296ZG(7) (definition of certain expressions) extends to this section.””
Lord Stevenson of Balmacara
My Lords, I shall speak also to Amendment 28DZD.
One of the difficulties about discussing the clauses on copyright in the Bill is that, although they are very important, they stand apart from important changes in copyright that the Government are making in parallel. I refer, of course, to the announcement on 20 December 2012, which prefigures the implementation of many of the recommendations of the recent Hargreaves review.
As many commentators have pointed out, making major changes to copyright has usually been done by primary legislation. The Copyright Act 1911 brought provisions on copyright into one Act for the first time; the Copyright Act 1956 covered the United Kingdom’s accession to the UCC; and the Copyright Designs and Patents Act 1988 is the current main legislative framework.
However, according to last month’s announcement, the Government will make changes by secondary legislation to private copying, education, quotation and news reporting, research and private study, access for people with disabilities, archiving and preservation, public administration, data analytics, and parody, caricature and pastiche. Many commentators feel that such a long list of copyright exceptions should be introduced by primary legislation; and I have some sympathy with that view.
When he comes to respond, I hope that the noble Viscount will explain in some detail the approach that the Government are taking. Pushing ahead with those measures in secondary legislation will, after all, not allow for the sort of debate and discussion that the torrent of representations that we are currently receiving would suggest is sensible.
The line being taken by the Government seems to be that, as they already have the power to make copyright exceptions under Section 2(2), they do not need primary legislation. With respect, I think that that misses the point. Those changes are important in themselves; they affect a major part of our economy; and they will interact with hundreds of thousands of people who work in those industries. If Parliament does not have a chance to debate those measures in detail, we are simply not doing our job.
I have tabled two amendments on the Hargreaves exceptions so that at least this issue can be raised. I shall make a couple of general points and then deal with the amendments, although not in any great detail. The first is that, in themselves, the new exceptions do a pretty good job of moving the situation forward from one where, over a period of decades, the focus of legislation with regard to copyright has been on either extension of duration or intensification of enforcement. On many of the copyright exceptions proposed, the Government have trodden a careful path between the contending views expressed in their consultation. Where an issue was uncontentious—such as copying for archive purposes—we have a clear and, to some people, radical change to the proposed position to allow unrestricted copying, which is a very welcome move indeed for countless museums, libraries and archives. Many of the specific proposals, however, seek to trade off contending points of view and interests, and are all the weaker for that.
If I were to take a view on which of the proposed copyright exceptions is likely to be viewed by the public as simply limp, I would say that the private copying exception, being confined to the individual rather than the immediate family, is the one that fails the basic test of realising where the consumer is on these issues. If my wife buys a CD, she cannot let me listen to it by copying it to my iPod. She can legally copy it to the music system of our car, but only if she owns the car and, by implication, the music system; it will not be legal if I am the registered owner. That will seem pretty daft to most people. There are of course arguments against a family private copying exception, not the least being able to define what is a family, but many will feel that an attempt should at least have been made.
Turning to my amendments, there are two issues. My concern about metadata is that although it is good that the Government are moving on it, the fact that they will be doing it through is secondary legislation means that, despite the consultation, the SI, which we hope to consider, will come through in the usual way in your Lordships’ House and will have to be approved through the affirmative procedure. That is in no sense a complete answer to the question. This is a controversial move, especially for publishers, many of whom have expressed considerable concern to both the Government and those of us involved in debating the Bill. Treating the proposal through the secondary route is not doing justice to the issue, to the community or to the wider public. A Grand Committee debate, where no amendments are permitted, is not a substitute for primary legislation. Perhaps the Minister can comment on that when he replies.
Lord Clement-Jones
My Lords, I support Amendment 28DZA in the name of the noble Lord, Lord Stevenson. I agreed with much of his introduction, the broad sweep of which was impressive given the nature of these amendments. He commented that exceptions will be introduced by secondary legislation. I associate myself with those remarks. I do not believe that secondary legislation is the right way to introduce those exceptions. It should be done by primary legislation.
That said, it is worth unpacking the metadata amendment slightly because I think that exactly how the amendment would operate should be on the record. Section 296ZG of the 1988 Act, which was inserted in 2003, provides protection for electronic rights management information by giving a cause of action to rights owners when such information is removed or altered by a third party without authority, provided that the third party has the necessary mental element—that is, that it knowingly and without authority removes or alters electronic rights management information.
The amendment seeks to deal with the specific problem that arises when copies of works or other subject matter are gathered by an automated process. It has particular relevance to the actions of search engines and other operators who “spider” the world wide web. Because copies are gathered and often stored or processed by an automated process, no human mind will normally read rights management information which is associated with or embedded in the protected subject matter. The law is presently unclear about the circumstances in which the operator of the automated process will be deemed to have rights management information drawn to his attention. Therefore, the amendment seeks to provide certainty in this regard. It does not expand the scope of any rights belonging to the copyright holder or other right holder. A person gathering materials is free to disregard any restrictions which may be communicated by means of rights management information if, for example, the acts he is carrying out are protected by a fair dealing defence or for any other reason do not fall within the scope of the copyright or other right.
Subsection (1) makes it clear that the effects of the proposed new clause are restricted to persons who gather or access copyright or other protected materials in the course of a business. Therefore, the circumstances in which consumers might be affected by any restrictions in electronic rights management information are outside the scope of the proposed new clause and remain governed by the law at large.
As the Minister may know, the amendment is supported by a large number of members of the creative industries. There is a strong view that metadata is crucial for the future of copyright protection, that it is central towards an efficient, effective and robust licensing system, that it has part of the solution to diligent search for orphan rights and orphan works, and that it is also helpful in terms of pseudonymous works.
I end by quoting the noble Baroness, Lady Buscombe —I often trawl through the internet to find her best quotations. This one is particularly apt in this set of circumstances. It comes from a House of Lords debate in June 2005:
“For those who make photography their life’s work, protecting their copyright goes beyond the emotive; it is their livelihood. Without adequate protection the photographic image—tomorrow’s cultural heritage—and those who create it will cease to have true value, and without adequate protection a profession dies. Photographers are concerned that, in the digital age, information supplied with the digital image about copyright and the creator is stripped away, often automatically, so that in a matter of moments the world is awash with ‘orphan’ images”.—[Official Report, 22/6/05; col. 1690.]
That was in 2005. We have not done anything about that issue but the passage of this Bill provides a chance to do just that.
Lord Howarth of Newport
My Lords, my noble friend has done well to raise the question of metadata in his amendment. I think that we need to be extremely careful about how we legislate on this, whether in primary or secondary legislation. Until such time as the technical means to counter the well known abuses of the intellectual property for digital photography by stripping metadata have been found, we should certainly be cautious, to say the least, about how we proceed to license digitally photographed works on the basis that they are orphan works.
My noble friend Lord Stevenson has also done us a good turn in fixing our attention on the question of what should be legislated in primary legislation and what should be left to secondary legislation. Will the Minister in due course comment on some questions of practicality and principle in this regard?
In what I am going to say, I make absolutely no criticism of the Minister personally. He has only just become Minister for Intellectual Property. I wish him very well indeed in that responsibility, and I hope he stays there until May 2015, and no longer. I wish him well during his incumbency, and the continuity that he may enjoy will undoubtedly be valuable for all concerned. Would it not have been more satisfactory if, when we came to consider clauses in primary legislation seeking to update the law on copyright, we also had before us at least an advanced draft of the secondary legislation to which the primary legislation would give authority? It is very difficult for us to know how to amend primary clauses and what view to take, all in all, about the Government’s proposals in the Bill if we do not know what the secondary legislation might look like as it will flesh out the relatively simple legislative propositions in the Bill.
I remember when it became clear that Clause 43 of the Digital Economy Bill was not going to make it to the statute book because of the imminence of the general election in 2010. I pleaded with the department that as it continued to wrestle with these policy issues it should move towards exhibiting draft regulations at the same time as it exhibited draft primary legislation so that all this could be put out to consultation together once it had been considered with the expert groups, such as those that the Intellectual Property Office is meeting at present. That was three years ago, and it seems to me that the House, and Parliament as a whole, is entitled to expect that the Government had made better progress on preparing the primary and secondary legislation before they presented it to us.
I was the government Whip in the Commons on the Copyright, Designs and Patents Bill 25 years ago, and I think it is fair to say that that legislation was somewhat less bald, somewhat less framework, and attempted to contain a more substantial body of legislative provision. The spirit in which both Houses of Parliament worked on that legislation 25 years ago was entirely collegiate. There was no party politics in it at all. We were all simply seeking to work our way forwards to find an appropriate legislative solution. Our deliberations and conclusions were observed with very great interest in other countries. We can continue to legislate in that spirit, but it would have helped us if the Government had allowed us to know a little more about what the primary legislation would open the way to.
While I reject the suggestions that have been put to us in some of the otherwise very helpful briefings that we have received that Parliament virtually does not scrutinise secondary legislation, I think that the situation, at least in this House, is significantly better than that, and we ought to pay tribute to the committees of this House that examine the quality and appropriateness of secondary legislation. We all know that it cannot be amended, and a great fuss is made if a statutory instrument is rejected by the House, so although we are not quite presented with a fait accompli when we consider secondary legislation, it is not a particularly satisfactory manner of advancing the frontiers of legislation. Much more exposure in draft and much more consultation—I know we will have it in due course—would be preferable at this stage. The Minister has perhaps not had an opportunity to consider this question of process as yet, so I hope that, not today, but at some point, he will feel able to offer some comments on it.
Viscount Bridgeman
My Lords, I declare an interest as a director of the Bridgeman Art Library, of which my wife is the founder and chairman. I shall speak to Amendment 28DZA in support of the noble Lord, Lord Stevenson, and my noble friend Lord Clement-Jones. The noble Lord, Lord Howarth, has reminded us of the history of the 1988 Copyright, Design and Patents Act. It goes a great deal of the way to protecting the rights of copyright owners, it removes the excuses for copyright material being lifted without a legal licence, it ensures that works created in future are not orphaned whereby, as your Lordships will be aware, work cannot licensed in the ordinary way because those who hold rights in it are untraceable, consumers get a genuine guarantee that the work is what it says it is and its creators take responsibility for it.
However there is one glaring loophole, which has been so ably addressed by my noble friend Lord Clement-Jones, in part opened up by fast-growing developments in digital practice. It is that at present users are currently able to shelter behind the fact that rights information, which forms part of what is loosely termed metadata, obtained and distributed by computer programs, as opposed to being obtained manually, escapes the protection afforded to creators by the 1988 Act. This amendment seeks to rectify an obvious anomaly in the existing legislation.
I would also like to draw the Minister’s attention to the fact that, should this amendment be accepted—and I am well aware that there is considerable debate about whether this will be in primary or secondary legislation—there will need to be a cross-over to those clauses relating to orphan works and extended collective licensing.
I would also like to mention that giving effect to this apparently simple intention in plain English at the same time as making it watertight in IT terms is no easy task, and the framers of this amendment are to be congratulated on doing their best. No doubt, if this amendment is accepted, as I hope it will be, the Bill team will be able to consolidate the wording.
Baroness Brinton
My Lords, with the permission of the Grand Committee, I shall speak sitting down.
I shall speak to both amendments. On Amendment 28DZA, will the Minister confirm that there is already protection under the law for the stripping of metadata knowingly and without authority? Other noble Lords have alluded to that. I understood that it gave us the protection that we were seeking rather than going down the route of this amendment. Any infringement is therefore already contrary to civil law. If there are concerns that that protection is not strong enough, especially in relation to computer and electronic equipment—for example, in cameras—it is not just about large internet companies stripping data. There is a real problem for photographers; I know that some of their data are stripped. I am looking at the noble Baroness, Lady Howe of Idlicote, when I say that we have worked with the ISPs in relation to child safety and pornography. Surely there is a more effective way of working in the internet age with organisations that, whether deliberately or not, might try to remove that data.
I understand that this amendment is trying to tackle the problem, but I am worried that it relies on individuals to instruct their electronic equipment. That might be fine in the case of a highly proficient technical photographer, but not necessarily fine for amateurs creating metadata, particularly on the internet, as well as for some professionals who do not understand the technology too well.
I worry that this amendment creates a further barrier to orphan works, which we will be discussing later. If this amendment is accepted, it will make it almost impossible to collect copyright licence fees for some orphan works because of the conditions it puts upon person A and person B.
I turn to Amendment 28DZD. It is a complete change in tone. I declare an interest as a former stage manager of Footlights. I worked alongside people such as Steve Punt and Hugh Dennis on their very first shows. I worry that paragraph (b), which states that copyright is not infringed if,
“it is accompanied by sufficient acknowledgement”,
would provide a real problem to people working in our fast-moving light entertainment and comedy world. I can absolutely understand the parody of major works: I think of Benjamin Hoff’s The Tao of Pooh, which acknowledges, right at the start, where it is coming from.
But there has been a traditional and proud history in this country of parody and caricature, from “That Was the Week That Was” 60 years ago, moving right up to date with “The Now Show” on Radio 4. Steve Punt and Hugh Dennis did a wonderful sketch a fortnight ago on UKIP and the referendum on Europe using the theme of Gollum in the film of Lord of the Rings. I do not know whether noble Lords heard it, but the theme of the programme was “We wants referendumses”. It was very effective.
The problem is that proposed new subsection (3)(b) in Amendment 28DZA would mean that every sketch like that in a fast-moving half hour show would have to stop to acknowledge that it was taking both a piece from Peter Jackson's original film and the style of the actor. Therefore, frankly, it would be unworkable. I apologise, but I am afraid that the stage manager in me immediately thought, “Oh my goodness: this will kill comedy and light entertainment of the spontaneous type that this country excels in”.
The Earl of Erroll
My Lords, I not sure why these two amendments have been grouped together because they are completely different. However, I will deal with the first one on metadata. I do not know what it has to do with stripping metadata off whatever you might read on the internet. It is saying, as far as I can make out, that if you have an automated system that comes across some metadata, it should respond to that intelligently and either not breach copyright or know that you are permitted to use it. But it does nothing about controlling the metadata or stopping people from stripping it.
In as much as it is saying that you should look at the metadata and therefore respond to it intelligently, yes, that is a nice thought. However, I wonder whether many programmes would be able to do that. I can see that it is probably targeted more towards the search engines and various things like that. I can see some problems with this and think that it will have to go into regulation to work out how to handle it.
We also need to think about the world stage and what is being done in other countries, because a lot of these things that look for items on the internet are based abroad. We want something that is practically useful. We do not want to drive things out of the UK. I am not saying that we should breach copyright and I think that we should use metadata intelligently to try to achieve the aims that we want, but we must be careful how we do it.
I am also keen on the use of data mining for research purposes. For example, you can talk to Wellcome and such people. Huge benefits have come from looking at disparate research material. Very often, new discoveries come from matching things from completely different spheres. That is what we forget when we worry about the protection of copyright for the artist or creative person in that sphere. Actually, researchers have completely different needs. They will not usually go around ripping off other people's ideas.
One of the challenges with this whole area of copyright is that we are trying to treat everything as if it is the same. It is not. Very often, when we benefit one lot we will disadvantage another and we need to be careful not to do that. That slightly worries me.
Leaving that to one side, Amendment 28DZD has a good point behind it, which is that you must have an exception for parody. Leaving the courts to decide what is fair in parody and what is not is very dangerous. As we know, courts are extremely expensive. If you are a small creative group trying to create parody and a big boy comes along and tries to hit you over the head in the courts, you will have to back down. That is bullying. Unfortunately, I do not think that our laws on bullying prevent that. If they did, we might be able to do something about it.
We must be very careful saying that recourse to the courts is workable. Basically, unless you are very rich or very poor, you are outside the law. You are not protected by British law because it is too expensive. That is something I have become aware of in general. We cannot rely on it. I think it is very important, but I entirely agree with the noble Baroness, Lady Brinton. We cannot try to attribute every single little thing that one tries to parody. That would be absolutely ridiculous and unworkable. Without that bit about the attribution, the idea that we are trying to protect parody is extremely important. Therefore, I like this amendment; it just needs a bit of tidying up, I suspect.
Viscount Younger of Leckie
My Lords, Amendment 28DZA would introduce a provision into the Copyright, Designs and Patents Act 1988 that changes the legal status of rights management information attached to digital material. This would make internet service providers responsible for ensuring any rights management information contained in metadata is recognised and acted upon. I have sympathy with creators whose wishes about the use of their material, expressed through metadata, are not always complied with. There are already well-established methods to control automated use of material posted online—for example, the use of robots dot text files to prevent crawling of websites by search engines. I was grateful for the technical insight on this from the noble Earl, Lord Erroll, who I suspect knows a lot more about this than my good self.
Internet service providers are already responsible for removing infringing material when it is brought to their attention. This is in keeping with other areas of law, where we do not expect carriers of information to be held liable for the lawfulness of that information. The approach suggested in the amendment would require all aggregators, indexers and other automated hosts online to develop systems to read metadata and comply with any conditions. As noble Lords will understand, this would be no small task. It would also replicate the efforts of a number of industry-led initiatives in this area, which are making progress. These include the Automated Content Access Protocol project, and work by the industry-led digital copyright exchange to look at the related issue of automated metadata stripping.
Government have considered the amendment carefully but do not consider that legislative change is the right step at this time. Moving on to Amendment 28DZD, noble Lords will be aware that the Government have announced their intention to bring forward legislation to introduce or update a number of copyright exceptions. A new exception to allow limited use of copyright works for parody, caricature or pastiche is part of that work. The amendment of the noble Lord, Lord Stevenson, is therefore going in the same direction as the Government’s policy. Rather than amend the Bill to achieve it, I suggest that it would be better to wait for the introduction of a parody exception, with the other proposed changes to copyright exceptions, in due course.
The Government have already committed to publish draft regulations later in the year, including provisions on this subject, for technical review by any interested parties. This will be an important opportunity to hear from experts, including in this House, to ensure that the regulations will have the desired effect. I would like to pick up on a point emphasised by the noble Lord, Lord Howarth, concerning secondary legislation. To clarify, we believe that exceptions to copyright that are explicitly permitted by the copyright directive may be introduced into UK law by means of Section 2.2 of the European Communities Act. The Hargreaves changes to copyright exceptions announced in December 2012 will be introduced by secondary legislation under the European Communities Act and not under the power in Clause 66 of the Bill. Our intention is to publish draft regulations for public comment in the spring. Government have considered the amendment carefully, but I hope that in light of the above, the noble Lord, Lord Stevenson, will feel able to withdraw this amendment.
Lord Stevenson of Balmacara
I thank all those who contributed to the debate. I am glad we got to the heart of it very quickly. I am particularly grateful to the noble Viscount, Lord Bridgeman, and the noble Earl, Lord Erroll, for their contributions of a technical nature. Who could fail to be persuaded by the noble Baroness, Lady Brinton, who lied when she said she was simply a stage manager? Clearly there was a touch of the real authorial actor there as well and I was grateful to her for her points. My failure here was clearly to have not done my research and realise that despite his youth and clear vibrancy in terms of matters cultural, the noble Viscount had not listened to his children and worked out where “Gangnam Style” was coming from. I perhaps should have taken a leaf out of the book of the noble Baroness, Lady Brinton, and actually done my bit of what it was that does it. It certainly would have amused the civil servants behind, but I think they were laughing already so it would have perhaps wasted my time.
On metadata, this was a probing amendment and was not meant to be one that would have solved the problem. I tabled the amendment because I think we are missing a key debate, and I am still not quite clear about when we are going to get that debate. The Minister said that legislative change in this area is not right, but he failed to explain why it is not right. Perhaps he will write to me and explain in a bit more detail. There is something here. It is clearly contentious, and we are not going to be able to discuss it very well in secondary legislation. I think we are missing an opportunity here.
On parody, we are still left with a problem that was not addressed in what the noble Viscount said. The legal problem with parodies is that,
“they need to be close enough to the original to be recognised by the audience as a parody in the first place, which means that they will almost inevitably infringe copyright”.
How do we get out of that? These words are quoted by the IPO. They are from somebody commenting on a case which sets the situation here quite well: “Newport State of Mind”.
We will not solve this today, and there is no point in continuing it. I shall withdraw the amendment, but when can we have these debates? I beg leave to withdraw the amendment.
“Exploitation of two-dimensional images of articles embodying designs derived from artistic work
(1) The Copyright, Designs and Patents Act 1988 is amended as follows.
(2) In Chapter 3 of Part I (acts permitted in relation to copyright works), after section 51 insert—
“51A Exploitation of two-dimensional images of articles embodying designs derived from artistic work
(1) This section applies where a design has been made available to the public, in the United Kingdom or elsewhere.
(2) It is not an infringement of copyright in the design itself (if any), or any artistic work embodied or incorporated in it, to make, distribute, communicate to the public photographs, graphic or reprographic reproductions, films, or other two-dimensional images of articles embodying the design.
(3) The Secretary of State may by order make provision excluding from the operation of this section such articles of a primarily literary or artistic character as he thinks fit.
(4) An order shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.
(5) In this section—
(a) design has the meaning found in section 1(2) of the Registered Designs Act 1949;(b) “making available” means making available to the public by publishing following registration or otherwise, or exhibiting, using in trade or otherwise disclosing.””
Lord Stevenson of Balmacara
I shall speak also to the other two amendments in the group which are in effect variations on a theme. Article 17 of the Designs Directive (98/71) and Article 96(2) of the EU Design Regulation (6/2002) leave to member states the freedom to regulate the extent of protection offered by copyright to designs. The amendments in this group seek to pre-empt what the Government intend to do in this complex area, which is to repeal Section 52 of the CDPA, by means of a general fair use provision and a narrower images exemption.
Amendment 28DZB seeks to protect the interests of many of the third parties affected by the Government’s proposal: those who have created images of existing designed articles. This includes publishers who have included images of old designs in their works, museums, individuals using images of design on websites, educators wanting to use images in teaching, photographers, picture libraries and so on. Many of these people will have invested in the production of images and films of designed articles when it was lawful to do so. Their interests are not likely to be protected by a transitional rule allowing stocks to be sold off; every time the images are shown in public, or reproduced, there will be an infringement.
This images exemption seeks to protect these third parties by allowing the making and exploitation of two-dimensional images and films of designed articles which have been placed on the market. In fact, it goes a little further than protecting these third parties during a transitional period, as it will permit such images to be created and sold in the future. This is a narrow derogation from the serious expansion of rights of design proprietors by the repeal of Section 52 and, in my view, does not prejudice the normal exploitation or the legitimate interests of the copyright holder. I think there is a major issue here, and I hope very much that the Minister will have further thoughts on this issue as he listens to this debate.
Amendment 28DZC builds on the breadth offered by the directive and the regulation. As drafted, the provision seeks to minimise the uncertainty inherent in a fair-use defence, such as that available generally for copyright under US law, with its white list and black list of deemed fair and unfair uses, leaving other uses to be judged in the individual case by reference to relevant factors.
One goal of this amendment is to protect follow-on designers: those who incorporate parts of old designs but transform the totality. It is well known that designers build with and on the design ideas of their predecessors. I believe the extension of copyright term to life plus 70 will make this much more difficult because of the sheer length of the term and because copyright protection is stronger in many ways than design protection. In my view, this issue has not been given sufficient weight, as we need to give careful consideration to the needs of future generations of designers.
Under existing design law, copying a part of an old design and incorporating it in a new, transformed design would not infringe any of the 25-year registered design rights unless the overall design produces on the informed user the same overall impression. However the copyright test is different. Copyright prohibits reproduction of any part of a protected work. One of the proposed white list of fair uses ensures that no use of a copyright-protected design infringes unless it would produce the same impression on an informed user. In short, it harmonises the copyright test with the EU design test.
Another goal is to protect educators, publishers, film-makers and website operators who use images of designed articles in their teaching, in their books, in their films and on their websites. These uses would be white listed as automatically fair. The black list deems unfair any use of a design in making an article which does not credit the original designer. It may be fair to start making old designs which are no longer being marketed—for example, fabric or wallpaper designs—particularly where the designer or design owner cannot be found. This clause indicates that it would not be fair to do so without indicating the origin of the original design.
However, the debate on this issue revolves primarily on whether the Government are right to delete Section 52 of the Copyright, Design and Patents Act 1988, whether by so doing and ending the current regime of registered designs they have fully considered all the issues which flow from that decision, and the implications that arise for products which are or are about to be out of rights protection under the present registered design period of 25 years, which will in future be in copyright for a period of 70 years after the death of the designer.
There is, of course, a very good case to be made for letting industrial designers have the same protection for their efforts as is available to composers, writers and the like, but I think there are some real questions about this issue, which might suggest to the Government that a pause for reflection before implementing this major change might be sensible.
One practical effect of this repeal will be to make replica versions of classic designs, such as Jacobsen’s egg chair, unaffordable to many consumers. Additionally, the creative freedom of future designers will be constrained because of the need to avoid breaching the copyrights of older predecessors, which cuts across the very essence of much industrial design.
Why was this proposal not preceded by a full consultation with stakeholders? Why has the impact assessment that has been published in fact got very little detail about the impact? Moreover, the assessment seems to have failed to acknowledge the impact on anyone other than designers, those who make and sell replica designs, consumers and the Government themselves. Would the Minister not agree that this initiative has not been handled properly?
The Minister may well argue that the Government had no option but to legislate. If that is the case, can he confirm that the Government are rushing to legislate on the basis of one recent European case, Flos SpA v Semeraro Casa e Famiglia SpA, which has been reported recently? The case concerned the design of the famous Arco lamp, consisting of a long, curved, metal arm supported by a marble block and finishing with a silver globe-shaped lampshade. I should declare an interest since I have one of the original design, fully paid for, at home. The design was created in 1962 by the Italians Achille and Pier Castiglioni, and any industrial design protection the design had once possessed has lapsed. Flos nevertheless claimed copyright in the lamp and that it had been infringed when Semeraro imported its Fluica lamp into Italy from China.
I am no lawyer, but I think we need to be sure that the UK response to Flos is appropriate and proportionate. The Government have decided on the basis of this single and recent case that we should abandon the whole of our registered design margin of appreciation. Surely the better approach would be to try to maintain Section 52, as that was explicitly agreed between the UK Government and the Commission during the process of adoption of the design directive. For the avoidance of doubt, as I have already said, there clearly is a good case for giving industrial designers the same copyright protection as applies to other creative industries, but the fact is that we currently have a different regime, and harmonisation of design and copyright should not be an end in itself or be driven by one isolated case.
The impact assessment is far from complete, but it admits that the reform of Section 52 will harm consumer welfare as classic designs—those that are more than 25 years old—will be re-monopolised. Replicas, currently available at some 15% to 20% of the price of the original, will no longer be available. No opportunity has been taken for consumers to be consulted. Moreover, there are those who argue that the impact assessment significantly underestimates the other costs that will arise, particularly because of its focus on furniture and three-dimensional design.
The Government believe that the change would encourage innovation and investment in design, but this is supported by the flimsiest of arguments in the impact assessment and no new evidence is offered to explain why the balance of interests between designer and owner, competitors and consumers, should be drawn differently today than in 1988 or indeed in 1994-95 when the Government successfully negotiated to retain Section 52 of the CDPA.
I am also concerned—and here I echo the comments made recently by my noble friend Lord Howarth—that as yet we have no idea what the traditional arrangements will be when Section 52 is repealed. Will it be on existing stocks and on articles which are out of copyright and which will now gain further periods of protection? Surely we need to see the draft proposals in this area as soon as possible and certainly before Report.
In conclusion, I should like to return to the question of the impact that this change will have on firms whose registered designs have come out of protection but which may now regain copyright protection to the detriment of consumers but to the benefit of rights holders.
I mentioned the egg chair, but it has been suggested to me that another area which will be affected is wallpaper. Wallpaper is within the current scope of Section 52 and is not in the exclusion for matters of a “primarily literary and artistic character”, so the change may well benefit companies in this field. The Minister will be aware of the firm Osborne and Little, which is primarily a wallpaper maker, founded in 1968. As I understand it, designs that were first produced and sold by that company between 1968 and 1987 will, if this clause goes forward, come back into copyright. It might therefore be for the benefit of the Committee if the Minister could confirm whether his right honourable friend the Chancellor of the Exchequer has been alerted to this change, as it may be of some considerable interest to him. I beg to move.
Lord Clement-Jones
My Lords, I strongly support Amendment 28DZB, and I shall also speak to Amendment 28EB. More particularly, in view of the very cogent introduction to Amendment 28DZB given by the noble Lord, Lord Stevenson—it was a tour de force, in my view—the fact is that Clause 65 looks more problematic the more one looks at it. The problems are exacerbated as there was no prior consultation by the Government on these provisions, nor is any cost or benefit set out in the impact assessment. Indeed, there has been no really authoritative review of the impact of the ECJ case mentioned by the noble Lord—Flos v Semeraro—and on whether it really does oblige the UK to repeal Section 52.
On the one hand, the design industry says that it has limited benefit, covering only works of artistic craftsmanship and only then pre-1989 designs and the introduction of the unregistered design right regime. The industry also says that works of art produced before 1957 would not benefit from the full copyright protection. On the other hand, many, including the publishing industry and the art and museum world, are very concerned about the impact of the clause on their ability to produce two-dimensional images of these kinds of artistic works, as the noble Lord, Lord Stevenson, has explained.
The proposed new clause is intended to apply the same term of copyright protection to artistic works as the term enjoyed by other copyright works—that is, the lifetime of the creator plus 70 years following their death. Currently, where more than 50 copies of an artistic work are manufactured, the term of copyright is only 25 years.
Publishers are rightly concerned about the impact that this clause may have on the publishers of books that include images and descriptions of artistic works which will now be subject to extended copyright. Such publications would be likely to find themselves retrospectively in breach of copyright. Without this kind of amendment, the clause could, as the British Screen Advisory Council has emphasised—I think that my noble friend Lady Brinton will be extremely interested in this—even include props used in a film and articles in a location where filming has taken place so that this is deemed to be copying of an artistic work which would otherwise have been permitted by Section 52. The position of websites, so important for public access and education, would also be uncertain. It would be even more disastrous if retrospective clearance were required.
I strongly support Amendment 28DZB, which would put this matter beyond doubt. I was delighted to see that it is also supported by the V&A, which is as good a judge as anyone on these matters and is able to take a balanced view—again, we have the word “balance”. However, I do not support the introduction of the novel concept of fair use in Amendment 28DZC, although I understand the motive behind it.
As a preferable alternative, Amendment 28EB, suggested by a group of professors of design and others, tries to meet the needs of follow-on designers—the designers of today and tomorrow that the noble Lord, Lord Stevenson, talked about. There are two concerns that underpin this amendment, particularly from those who have a great deal to do with up and coming designers. Copyright, as they explain, is in important respects more restrictive on follow-on designers than the protection given by community and national registered and community unregistered design rights, which limit protection for the making of articles which do not produce on the informed user a different overall impression. So if a designer uses part of an existing designed article but incorporates it in something that overall appears different, under the community registered and UK registered design, there is no infringement. In contrast—and I know that the noble Lord, Lord Stevenson, put this in other words—copyright has been interpreted to prohibit the reproduction of any part which is itself original in the copyright sense of involving creative choices. So if a motif from a textile or wallpaper—we are back to wallpaper—is copied but put in a very different context, there will be infringement of copyright, but not design rights. These professors say that the difference is not widely appreciated, as it depends on a detailed understanding of each legal regime, added to which we are only starting to get court decisions on the interpretation of the community design test and the EU copyright notion of reproduction in part.
Baroness Warwick of Undercliffe
My Lords, there are concerns about the impact of Clause 65 on designers and manufacturers, but this amendment seeks to address a problem which the clause will create for anyone who wants to use a two-dimensional representation of a design that is in copyright. This will affect a wide variety of users, but I am most concerned about the impact on those involved in teaching design. I declare a non-financial interest as a member of the council of University College London.
It is obvious that one cannot teach design without being able to show images of designs to your students. If you want to do this by example, showing a PowerPoint slide of a design during a lecture and the item is in copyright, you need a licence. If the term for industrial designs is increased to 70 years plus life, that means that you will need a licence for almost all 20th century designs. Many of these will be orphan works, so securing a licence under the current law would be difficult if not impossible. This would be eased by the orphan works provisions, which we will come to shortly. Meanwhile, this will have a real impact on the teaching of creative subjects.
In copyright, we have had almost nothing but consultation for the last decade, yet there was no consultation of non-commercial users here. The Government should consult all those potentially affected by the impact of this clause. The proposed amendment would be a proportionate response to the problem, allowing teachers, lecturers, museums, publishers and libraries to use photographs of designs without the need of a licence. It is in the interests of the creative sector that we allow such uses.
Viscount Bridgeman
My Lords, I speak to Amendment 28DZB, which has been so ably covered by the two movers of the amendment. I support this amendment as far as it goes, but it needs to make the distinction between incidental use, such as a passing shot of a chair on a TV programme, and one with a wider agenda—for example, financial or political. A well known example of the latter is the case about two years ago brought by Unilever, owners of the Marmite brand, against the BNP, whose image of a Marmite pot was a major feature on the BNP website. This resulted in an out-of-court settlement in favour of the plaintiffs. I hope that the Minister will take note of this proposed adjustment to the amendment.
Lord Howarth of Newport
My Lords, I support Amendment 28DZB. My noble friend Lord Stevenson of Balmacara has explained to the Committee why the jurisprudence of the European Court of Justice does not require after all that the Government repeal Section 52. I hope that the Government will think again very carefully about what they are doing.
I commend to the attention of the Minister and his officials the submission that other noble Lords will have received from Professor Lionel Bently of the University of Cambridge, which deals authoritatively with this matter. There would be significant and seriously unfortunate implications for teachers, publishers, museums, photographers, artists and filmmakers.
I echo and endorse the points very well made just now by my noble friend Lady Warwick. The impact on the practical ability of teachers of design to teach their discipline properly would be very damaging. If we undermine the teaching of design in this country, we do deep damage to the creative economy and make it less likely that new copyright and intellectual property will be developed for the benefit of our culture and our economy in the decades that lie ahead.
Baroness Brinton
My Lords, I particularly support the comments made just now by the noble Baroness, Lady Warwick, and the noble Lord, Lord Howarth of Newport, on how the proposals would affect teachers in schools, colleges and universities. We have already heard that in order to use any type of digital information, users will need to apply for a licence. In addition to teachers, publishers reproducing photographs of industrially produced articles or museums and archives wanting to display them will also require licences. Along with other noble Lords, I am concerned that this will stifle the development of the creative sector, which is vital to the growth of the economy. There needs to be a balance between what is trying to be achieved and the practical problems that teachers and others would face.
I am also concerned that the government impact assessment focuses solely on commercial designs—as was pointed out by the noble Lord, Lord Stevenson—particularly replica furniture and other household goods. It is essential that non-commercial users are also consulted; they are currently covered by Section 52 of the CDPA, as has been mentioned. Those would include academics, museums, archives, libraries and publishers to make sure that the repeal of this provision does not have a negative, unintended consequence.
On Amendment 28EB, I am grateful for the reference by my noble friend Lord Clement-Jones to props in theatre. Unfortunately, the second paragraph of his amendment would create a practical problem. Before I went to Cambridge, I was a stage manager at the BBC. When you ordered a prop, you ordered it in one of three forms. It was either fully practical, for example a phone that would ring and you could speak to somebody; practical, so that you could pick it up and it would look and sound like the real thing; or non-practical—basically wood painted to look like the required item. All three of those were an identical telephone. Unfortunately, the clause would create a real problem, because the intention was to produce the article, as defined here, with no intention at all to infringe any copyright. I suspect that, with phones being so cheap these days, people do not go to the bother that they used to in the early and mid-70s when I was carrying out these orders, but there are plenty of other things within the creative sector that would be caught by this unintentional consequence.
Lord Clement-Jones
I want to respond very briefly to my noble friend. This amendment is intended for an entirely different purpose. It is not designed to deal with the props issue. The amendment put forward by the noble Lord, Lord Stevenson, was to deal with that, but this is to deal with an entirely different issue to do with follow-on design. Young designers use inspiration from an existing artistic three-dimensional work and want to incorporate that. That is the purpose of this amendment. This is needed in addition to other amendments to the clause. That is why the more you look at Clause 65, the more problematic it becomes.
Viscount Younger of Leckie
My Lords, Amendments 28DZB and 28EB are intended to ensure that artistic works can continue to be used in two particular ways after the repeal of Section 52 of the Copyright, Designs and Patents Act, or CDPA for short: first, that it shall not be an infringement to use an image of an article protected by copyright in a film, photograph or book; and, secondly, that it shall not be an infringement for new designs to use motifs from artistic works protected by copyright. For example, following the repeal of Section 52, a publisher who reproduces a photograph of any artistic work in a book may need to obtain permission to do so. Similarly, the scope for follow-on design may be restricted. The amendments are intended to make special provision for those circumstances.
The repeal of Section 52 means that all artistic works, irrespective of how and by whom they are used, will be treated equally under the law. The amendments seem to be intended to create special cases for particular uses of works. It is not clear that there is a compelling reason for some artistic works to be treated differently in that way. For example, why should it be necessary for a filmmaker to obtain permission to reproduce a painting by Francis Bacon, but not for another artistic work, such as a designer lamp?
Amendment 28DZC would create an exception that would cover the situations outlined above, but it goes further. It would in some circumstances allow the production of replicas and not just images of articles protected by copyright. As drafted, this would not be compliant with existing law.
There is another aspect to consider. In December, the Government announced changes that will be made to copyright exceptions. These will include, for example, an amended quotation exception, which will permit the use of photographs of artistic works in situations that the courts determine to be fair, and new exceptions for education. Those could cover some uses envisaged under the amendment. I reassure the Committee that the issue can be returned to when we have some experience of how the new arrangements work.
I shall pick up a number of points raised by noble Lords. First, I did indeed spot the article in the press this morning concerning the family business of a well known member of this Government. I think that the question of the noble Lord, Lord Stevenson, was: is it true to say that the wallpaper produced by the Chancellor’s family-owned interior design business will qualify for copyright protection? The repeal of Section 52 could benefit anyone who owns the copyright in a wallpaper, but not all wallpaper will qualify for copyright protection. That will depend on, for example, whether the wallpaper meets the requisite standards to qualify for copyright protection and is, for example, sufficiently artistic and original. Ultimately, that will be a matter for the courts to decide. The Government and the Design Council consider that the repeal of Section 52 will benefit young designers, as it should lead to UK designers developing new designs in markets that become less dominated by copies of artistic works. I hope that noble Lords find that particular example helpful.
It is important to address the point raised by the noble Lord, Lord Stevenson, concerning consultation. Indeed, it was an issue addressed by the noble Baroness, Lady Warwick. It concerns what consultation there will be before the repeal of Section 52. The UK is one of the few member states that has such an exemption. Further consideration will be given when the Government consult on how and when to bring that into force. Further to that, I reassure the noble Lord, Lord Stevenson, that the Government have discussed the repeal of Section 52 with interested bodies, including representatives of sellers of replicas of classic design furniture, such as Scott Howard Office Furniture. We have also had discussions with the Publishers Association, the chairman of the IP Bar Association and Professor Lionel Bently.
The Government will consult formally on how and when the repeal should take effect. We want to hear from affected firms to ensure that the right transitional arrangements are in place to allow them to adjust—for example, by modifying their supply agreements where necessary. The Government believe that it will be business as usual for many British firms who manufacture or sell affected replicas.
The noble Lord, Lord Stevenson, highlighted the question of how Clause 65 is supported by designers. Designers argue that the law undermines the integrity of the design industry and may make British companies less willing to support long-term investment in areas such as furniture design than their European competitors. I quote Sir Terence Conran:
“By protecting new designs more generously, we are encouraging more investment of time and talent in British design. That will lead to more manufacturing in Britain, and that in turn will lead to more jobs—which we desperately need right now”.
Tom Dixon, a British designer, has said:
“Current copyright laws leave designers woefully under protected compared to similar creative professions. This initiative is a small step toward establishing much needed protection of valuable intellectual property”.
The Government have considered these issues very carefully. I hope that in the light of the above, the noble Lord, Lord Stevenson, will withdraw his amendment.
Lord Clement-Jones
Briefly, my Lords, if I may, I understand everything that the Minister has said, but I was a bit flabbergasted by the final statement that the Government have considered this very carefully. The Minister mentioned a few people whom the consultation had taken place with, but the fact is that those people who are suggesting amendments are the very people with whom the consultation has taken place—the Publishers Association and seven professors of design who, after all, ought to know whether young designers are going to benefit from this kind of provision. They have a clear view when they are looking at young designers in the future. There are seven of them, from the University of Cambridge, King’s College London, the University of Glasgow, Oxford, University College London, Bournemouth University and the University of Edinburgh. If they do not know what is going on in the field, who does? They have grave concerns. I felt that the Minister’s response was both disappointing and rather dusty. Perhaps he could give some sort of undertaking to look at this a bit more carefully rather than simply saying, “There is no amendment possible to this clause; all that is available is consultation over how it is brought into effect”. Surely that is unacceptable in the light of all the concerns that have been raised about Clause 65.
Viscount Younger of Leckie
I have listened carefully to my noble friend Lord Clement-Jones on these matters and have taken note. I am not sure that I can convince him that consultation is the right way forward, but I hope that he will accept that. I doubt that he will, but I have taken a firm note of what he has said.
Lord Stevenson of Balmacara
My Lords, I am grateful to everyone who has contributed to this debate. We all broadly sung much the same tune. There are minor changes and I accept the point about the incidental and substantive issues and the need to be careful that we do not knock out the use of props in trying to find a better solution than the one that the Government are proposing.
I am afraid, though, that I echo the comments of the noble Lord, Lord Clement-Jones, by saying that I do not think that we got to the heart of the debate here. To be fobbed off with the idea that somehow by taking these rather extraordinary Henry VIII powers—probably on the wrong legal basis and almost certainly heading in the direction of a conclusion that almost no one else, given the same facts, would arrive at—and then to be told that we can return to this once we have experienced how the laws work does not seem to be a very satisfactory way of going about this.
This needs a bit more consideration and debate. As was said, many of the issues here are not party-political in the sense of opening up great divides between us. We all want a solution to this; I have said twice that I am not against the idea that in the medium to long term we should find a way of establishing a comparability of status for industrial designers and those in the other creative industries. On the other hand, as the noble Lord, Lord Clement-Jones, said, life plus 70 years is a very long time. To change radically, in one short clause in a Bill that is largely about other things, from 25 years to life plus 70 is a big step. We are not saying, “Don’t do it”, but we are saying, “Let’s talk about this a bit more and try to get a better sense of what the issues are”. As someone said—I think that it was the noble Baroness, Lady Brinton—we are concerned about avoiding unintended consequences. There are some already, and we have picked up several of them in the examples that we have given today.
On wallpaper, I thought that hoping that the Hargreaves report would come to the rescue was a little limp. We are not talking about the sort of designs that might be found in commercially popular suppliers of cheap paper and products; we are talking about those people who have registered designs that they have utilised in a perfectly appropriate way in their business to obtain a suitable return on their investment for a number of years. That is changing from 25 years to life plus 70 where the registered design is in the ownership of the company. That is a very large step indeed.
I used that only as an example. I did not want the Minister to be defensive about it, but it made my point well. The approach that he has taken simply does not answer the question. I am sure that we will have to return to this but, in the interim, I beg leave to withdraw the amendment.
Baroness Whitaker
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Baroness Whitaker
My Lords, this group of amendments is about Clause 65 as it affects the creators of the work and thus it has a different slant. I apologise for not being able to speak at Second Reading to indicate the line of the amendments in my name and that of the noble Lord, Lord Jenkin of Roding, but they are very much in the spirit of the Government’s repeal of the exception provided in Section 52 of the 1988 Act, which I applaud. I am glad to say that the design industry is in favour of our amendments and I am grateful for its expert comments.
Amendment 28DA simply completes the protection for our creative designs that the Government provide by their initial repeal by applying it also to works of art made prior to June 1957. Most heavily copied classic designs, such as the Eames chair, were created prior to 1957, so without this amendment the Government’s repeal would be of limited value and, incidentally, would leave the UK in breach of the European Court of Justice’s decision in Flos, to which my noble friend Lord Stevenson and other noble Lords have referred.
Amendment 28FA also completes, I submit, the Government’s intention in their repeal. The two provisions in it are almost consequential to Clause 65. The amendment to Regulation 16 of the Duration of Copyright and Rights in Performances Regulations 1995 ensures that the regulations apply to copyrights that were never protected under previous legislation but will be now. If Regulation 24 of those regulations were not amended as we suggest, the making or import of copyright-infringing articles would be permitted indefinitely, on payment of a royalty, in cases where, for instance, a furniture design has been revived. This again is incompatible with EU law. Without this amendment, some of our most important and iconic designs would not receive the protection that the Government appear to have in mind.
Amendment 28EA ensures a short transition period of four months, but with the possibility of a four-month extension if warranted, for third persons who manufacture or who hold stocks of copies of design works within the European Economic Area. Most of these replicas are not made in the EEA—we all know where they are most likely to originate. The repeal of Section 52 will not have any substantial impact on employment or businesses in the UK, so it is reasonable to allow a short time for them to comply, with a proportionate extension to strike a balance—there we go again with balance—between the rights of designers and the interests of undertakings caught by the new law.
In conclusion, I draw noble Lords’ attention to the present situation for our many talented designers who add so much to our economic strength, as the Minister said. Because there has been insufficient protection, the UK has become a safe haven for the sale of replicas of designs that breach copyright. Only two other countries in Europe fall short of good practice in this way: Estonia and Romania. Indeed, there are several criminal prosecutions pending against UK-based suppliers in other countries. The damage to the reputation of our design market—potentially one of our great strengths—is immense. No British jobs are at stake if we implement these amendments and fair competition as well as our international reputation will be improved. Our brilliant design businesses will have more security to develop. It is a win-win prospect. I beg to move.
Lord Jenkin of Roding
My Lords, I added my name to the noble Baroness’s amendment. I, too, have had representations from the organisations that represent designers, and emphasise one point made by the noble Baroness: that many of these replicated designs are not made in the EEA, and certainly not in the UK. One group conducted considerable research on this subject and discovered that quite often a UK name is linked with the design, but that when you go behind that you find that it is largely a sham. It is quite clear that all this comes from abroad, so merely repealing Section 52 by itself will not achieve the Government’s intentions. As for their representing it as being of considerable value to designers, I have to say that without the two amendments in this group which the noble Baroness has tabled, it will be largely ineffective.
I hope very much, therefore, that the Government will feel able to accept these amendments. As the noble Baroness said, they complete the reform which the repeal of Section 52 is intended to provide. They add nothing that is extraneous to it, they merely make it effective, and I am sure that that is what the Government want. I hope very much that my noble friend the Minister will feel able to give these amendments a fair wind.
Lord Howarth of Newport
My Lords, I oppose these amendments. It seems to me that the extension of copyright design from 25 years to life plus 70 years is altogether excessive. That could amount to something like 120 years, and it would be particularly unfortunate if we were to extend the proposed provisions to apply to designs created before 1957. I entirely support the principle of a fair return to designers and to their estates, but it seems to me that 25 years is sufficient. I am not in favour of protecting the monopoly of the purveyors of Eames chairs, which my noble friend Lady Whitaker cited as an instance, or indeed of Eileen Gray chairs or any other famous and beautiful designs that would be affected by this amendment. It seems to me that the prices that are charged to people who want to buy these pieces of furniture are quite outrageous. I ask my noble friend Lady Whitaker in particular why good design should be available only for the rich? I want to see Eames and Gray designs for the masses.
I further note that the proposals in these amendments are protectionist. That does not seem to me to be particularly constructive. They are keen to keep out replicas that might be made elsewhere. If we were not to perpetuate beyond 25 years the inhibition on manufacturing and retailing in this country, we would do good to a significant sector of our economy and we would enable the quality of life of a significant number of people to be significantly improved. So personally I do not favour the amendments that have been proposed.
Lord Clement-Jones
My Lords, I speak to Amendments 28E and 28F. The Government, and indeed the IPO, published a factsheet on copyright protection for designs, but with the best will in the world this was not adequate, especially in the absence of an impact assessment. The Government need to provide detail in the Bill on the transitional arrangements that they intend to introduce. Without clear and explicit communication about those arrangements, manufacturers and others affected—we have heard that considerable numbers will be affected—will not feel confident that their works and therefore businesses will not be affected. Waiting for the Bill to pass before consulting on transitional arrangements is surely unacceptable and creates a climate of uncertainty. The Government need to be clear as to what they believe is an acceptable and legal transition period. Under European law, the UK Government may have limited scope to introduce transitional arrangements that would be broad enough to mitigate a significant and detrimental impact on third parties. We know that, at the very least, a period of 10 years’ transition has been ruled by the ECJ as being too long, so it is vital to know what period of transition the UK Government believe would be in compliance. Will the Government provide an impact assessment to analyse the effect of various transitional provisions under the clause on the publishing and other third parties? My amendments put forward two rather different suggestions for the transitional period for replicas of artistic designs and are an attempt to tease out the Government’s real intentions. The first amendment is very similar to that put forward by the noble Baroness, Lady Whitaker, and is designed to flush out the process by which the Government intend to introduce transitional provisions. The second, along the lines of that of the noble Baroness, Lady Whitaker, is designed to probe the actual transitional provisions.
Amendment 28F would ensure a short—six months is more reasonable than four—transitional period for products manufactured within the EEA, and third persons that hold stocks of unsold items in the EEA. That is a variation of the amendment proposed by the noble Baroness, Lady Whitaker. It also foresees a six-month extension if a third party provides justification of some exceptional circumstances. The design companies say that most companies offering replicas of artistic designs do not manufacture those products in the EEA. We heard that from the noble Baroness and from the noble Lord, Lord Jenkin. They say that most replicas are imported from Asia. Has an assessment been made of this, and has it been assessed as part of the likely transitional periods? A six-month transitional period under Amendment 28F could be extended up to 12 months. It would also be in line with EU law by being proportionate and not going beyond what is needed to ensure an appropriate balance between the interests of the right holders and the legitimate expectations of the parties concerned.
Viscount Younger of Leckie
My Lords, Amendment 28DA seeks to ensure that copyright is revived in works of artistic craftsmanship created before 1957. This would apply, for example, to works such as the Wassily chair, designed by Marcel Breuer in 1925 to 1926. Chairs seem to be a favourite theme today. The noble Baroness, Lady Whitaker, mentioned a chair; I was not entirely clear what type of chair it was.
The law in this area is complicated, but the term directive is clear. If the chair was protected by copyright in any other member state before 1995, copyright would also have to apply in the United Kingdom. Amendment 28FA also concerns those works in which copyright is revived. It seeks to remove those provisions which impose an obligation on the owner of a revived work to grant a licence even if he would prefer not to do so. The noble Baroness, Lady Whitaker, has raised an interesting point with this amendment that deserves further consideration. We shall have the opportunity to consider these very specific issues more carefully before the clause is commenced and there will be the opportunity to deal with the issue in the relevant regulations.
Amendments 28E, 28EA and 28F seek to set out the transitional provisions which govern how the change in the law will apply to articles made or imported into the UK or EEA when the law is changed. The Government are aware that there are potential impacts on businesses that manufacture or sell replicas and are committed to consulting on how and when to implement the changes.
My noble friend Lord Clement-Jones asked whether there will be an impact assessment to show the potential effects of the transitional provisions on producers and other third parties. The Government have already produced an impact assessment and will ensure that it is kept up to date as the legislative process moves on.
There are pros and cons to setting a relatively longer or shorter transition period. We understand how that concerns my noble friend Lord Jenkin and the noble Baroness, Lady Whitaker. It will be important that any decision on transitional provisions takes account of the consent of all parties involved. That includes, for example, the length of existing supply contracts and leases for warehouses where products are stored. I confirm to the Committee that we intend that existing stock in the UK will not be affected by the change in the law; the change will apply only to items manufactured or imported after that date. If an express transitional provision proves necessary, the regulations shall provide for it.
This change in law needs to be introduced in a measured way, balancing the needs of the parties involved. The Government have carefully considered the issues and I hope that, in the light of the above, the noble Baroness and my noble friend will not press their amendment.
Lord Clement-Jones
I shall intervene only briefly. It is good news to hear that there is an impact assessment on business and other third parties which will be regularly updated, but, personally, I am none the wiser about the Government’s intentions about time periods for the transition. It is rather baffling. If there is an impact assessment which helps to inform government policy in this respect, it has not been used to take the next step, which is to give a concrete view of the proper period, how the transition will take effect and on whom it will impact.
If the regulations are in the offing, it would be extremely helpful for the Minister at least to give us a glimpse of some of the thinking, which might allay some of the concerns raised in this short debate.
Viscount Younger of Leckie
I can only reiterate to my noble friend Lord Clement-Jones that we are committed to continuing to consult. The best way to respond is to say that we will continue to keep him informed on progress. Progress is not intended to be slow; we intend to proceed with this as fast as we possibly can and to present a timetable wherever we can.
Baroness Whitaker
I am most grateful to the noble Lord, Lord Jenkin of Roding, and all others who spoke—even my noble friend Lord Howarth of Newport who, uncharacteristically, devalues the individual nature of creative inventions. If that individual, unique creation is not properly recognised and compensated, it will decreasingly be made, certainly in the UK. Apart from the simple injustice, which is the other point, there is an economic chilling factor.
I am grateful to the Minister—incidentally, it was the Eames chair that I mentioned; in fact, all the Eames chairs would qualify—but I hope for discussion with him before Report, because I think that we can arrive at some solution. I beg leave to withdraw the amendment.
“( ) The Secretary of State may by regulation vary penalties in accordance with the penalties laid down in the Act.”
Lord Stevenson of Balmacara
My Lords, as originally drafted and debated in another place, this clause equipped the Government with wide-ranging and far-reaching powers to amend, remove or introduce exceptions to copyright via secondary legislation. It caused a fair amount of alarm and a lot of correspondence from those who were following the debate in another place. Many noble Lords present today will have received correspondence about this.
The amendments made during Report in the House of Commons clarified that the regulations,
“may make only such provision as may be made under subsection (2) of section 2 of European Communities Act 1972 or such provision as could be made under that subsection if paragraph 1(1)(d) of a Schedule 2 did not apply”.
I think that means that the Government’s stated aim is to,
“make it clear that [the clause] offers no further power than Parliament already has to make changes to copyright exceptions”.
However, we are disappointed that the language and scope of the clause continues to focus on exceptions to copyright, rather than criminal penalties, which ostensibly is its purpose.
If the Government’s intention is to safeguard criminal penalties for copyright infringement—which is absolutely necessary—we cannot apprehend why there continues to be such a resistance to making that intention unequivocally clear on the face of the Bill. Many of our correspondents would like to see this clause deleted in its entirety. Indeed, a number of proposals have been made in that respect. We have, however, proposed that amendments that seek to narrow and clarify the intentions of the clause in line with the Government’s stated aims, by stipulating that each proposed exception to copyright is subject to an individual statutory instrument and has its own associated economic impact assessment would be the right way forward. Reform of exceptions must not be bundled into a single SI.
Seemingly minor amendments related to changes in the scope of copyright exceptions can have significant commercial consequences for organisations that invest heavily in content creation and preservation. Each individual exception requires careful consideration. I beg to move.
Lord Clement-Jones
My Lords, I strongly support the amendments put forward by the noble Lord, Lord Stevenson. The stated aim of Clause 66 is to ensure that where secondary legislation is used to amend copyright exceptions, the existing penalties for copyright infringement would remain unchanged. This is stated in paragraph 506 of the Explanatory Notes. This stated aim by itself is unobjectionable. However, throughout the Bill’s passage through the Commons, MPs and outside organisations expressed serious concerns regarding the wide drafting of the clause—then Clause 56 and 57. The drafting was too broad and potentially involved the Government having significantly greater powers to alter copyright exceptions by secondary legislation than they currently enjoy. The Government amended this clause on Report. An amendment introduced on Report in the Commons permits the Secretary of State by order to change copyright exceptions within the scope permitted under subsection (2) of section 2 of the European Communities Act 1972—implementing European directives—and repeals paragraph 1(1)(d) of Schedule 2 to the EC Act in respect of such changes.
The new wording to Clause 66 gives some but not enough reassurance or certainty that the clause will be limited in application to penalties. The Government’s explanation of Clause 66 refers to penalties. Clause 66,
“arose as a specific consequence of our wanting to keep the strong penalties needed to remove exceptions.”—[Official Report, Commons, Enterprise and Regulatory Reform Bill Committee, 12/7/12; col. 628.]
However, Clause 66 is headed “Power to change exceptions: copyright and rights in performances”. The clauses as added to the Copyright, Designs and Patents Act 1988, which they are intended to amend, will be headed “Power to add or remove exceptions to copyright” and “rights in performances” and the clause itself refers to copyright exceptions.
Furthermore, as the noble Lord, Lord Stevenson, said, there is no impact assessment and there has been no consultation on the clause. These amendments limit the clause to penalties—it removes the references to copyright exceptions. The Government have explicitly stated that they will not use Clause 66 to introduce exceptions. The Government stated that:
“Clause 56 is not part of the wider Hargreaves work but arose as a specific consequence of our wanting to keep the strong penalties needed to remove exceptions.”—[Official Report, Commons, Enterprise and Regulatory Reform Bill Committee, 12/7/2012; col. 628.]
Clause 69 is in many ways admirably concise in relation to penalties relating to copyright protection under the term directive. Clause 69 refers explicitly to penalties and is unambiguous. Why can Clause 66 not be drafted similarly?
I understand that officials have said that Clause 66 may be used to amend two sections, Sections 72 and 73 of the CDPA, but those issues are the subject of court proceedings and it is doubtful whether Clause 66 as amended would be able to address the issues adequately, because they lie outside the European acquis communautaire and further primary legislation would be needed in any event.
It is not surprising that in a recent meeting with stakeholders, an official of the IPO said that all are agreed that the current wording of Clause 66 is confusing. Why do we not make everything clear and take on board these amendments?
Viscount Younger of Leckie
My Lords, Amendments 28FB and 28JAA cover the scope of Clause 66. The Government recognise that concerns about this clause remain, despite their efforts to clarify the scope through a government amendment on Report in the Commons. The Government have looked carefully at these amendments and I believe that we understand the intentions of the noble Lord, Lord Stevenson. However, we believe there is the possibility that the amendments as currently drafted would in fact widen the scope of the Government’s power to effect changes in this area with respect to criminal penalties. I do not believe that that is what the noble Lord intended through his amendments.
The Government’s intention with this clause has always been to maintain the current level of criminal penalties whenever it is required to amend or remove copyright exceptions. However, there remain concerns about this clause, as reflected in the intention behind the noble Lord’s amendments. In this light, I am prepared to look again at what more can be done to ensure the clause does exactly what the Government intend and no more.
I hope that in light of the above assurances the noble Lord will withdraw his amendment.
Lord Clement-Jones
I always get up when there is something to object to, but in this case I will thank the Minister for that reply. I am sure that the noble Lord, Lord Stevenson, will make a very positive response.
Lord Stevenson of Balmacara
My Lords, he does not give me much leeway, does he? I thank him very much, and I withdraw the amendment.
Lord Clement-Jones
Lord Clement-Jones
My Lords, I will speak to Amendments 28G, 28H and 28J. I will not speak to Amendment 28JA, but I support it, and I know that the noble Lord, Lord Jenkin, will speak to it.
As has been discussed, an earlier version of Clause 66 was the subject of extensive debate in the House of Commons, particularly in Committee. As a consequence of the points raised, the clause is amended, and I welcome the fact that the Minister has indicated a further amendment to give greater clarity about the intention behind the Bill since then. The primary intention behind this clause is to allow new exceptions to copyright to be accompanied by the introduction of higher criminal penalties for infringement: the power which the Government do not have under the ECA.
However, many copyright-owners in the creative industries are very concerned even—we heard concern expressed earlier, notably by the noble Lord, Lord Stevenson—that secondary legislation will be used under the ECA, not least the Law Society, of which I am a member. Secondary legislation is difficult to review or challenge, even though subject to the affirmative procedure of both Houses. This is what the Alliance for the Protection of Copyright says: “However, our support”, for Clause 66,
“should not be read as support for the introduction via secondary legislation of the exceptions proposed in the recent Copyright Consultation. Given the potential negative consequences”—
for UK creators associated with “these proposals” changes,
“should … be introduced via primary legislation allowing parliamentarians’ full and proper scrutiny”.
Of course, as I said earlier, following Hargreaves the Government proposed, and have started implementing, a copyright hub that without legislation and by the voluntary participation of rights-holders and users is intended to solve the problems perceived by Hargreaves, at which the exceptions by and large are directed. Therefore, there are many who claim that those exceptions are unnecessary.
However, even if secured by secondary legislation, exceptions that impact so greatly on the UK’s creative industry sector should not be bundled in a take-it-or- leave-it fashion, which would not allow the varying impacts of such proposals on separate creative sectors to be appropriately taken into account. At the very least, they should be accompanied by individual impact assessments and introduced in separate SIs. In the recent Modernising Copyright White Paper, it is stated that the Government intend to make changes to copyright exceptions in the smallest number of statutory instruments. Therefore, if secondary legislation is to be used, each proposed exception to copyright should be subject to an individual statutory instrument, contrary to that statement. Rights holders are concerned that the introduction of any new copyright exceptions, whether through Clause 66 or the ECA, must be done through careful consideration of each individual exception.
The other possibility—that exceptions be bundled together in a single statutory instrument—would prevent Parliament being able to accept some changes while rejecting others. Such a take-it-or-leave-it approach to copyright reform is wholly unsuited to the nuance and detail of the subject and risks there being a fudge across a number of different issues—for example, conflating questions around photocopying educational text books with the question of burning CDs.
There may, however, be some exceptions which are linked and which could be dealt with together. Some of the exceptions are interrelated. For example, I gather that the IPO believes that the exception on private study links with the exception for research and with the exception which permits libraries to copy for a researcher. Therefore, there is not an unreasonable demand where there are links. It will be important to ensure that changes across exceptions are consistent, and separate SIs for each proposed change could lead to problems of inconsistent law.
Each proposed exception should have its own associated economic impact assessment. As the economic evidence which accompanied the Hargreaves review of IP and growth sadly demonstrated, the economic analysis underpinning some proposed changes to copyright is either lacking or flawed. Officials have indicated that new impact assessments will be published alongside any proposed changes to copyright, and I would certainly welcome reassurance from the Minister that that will be the case. I beg to move.
Lord Jenkin of Roding
My Lords, I wish to speak briefly to Amendment 28JA. The noble Lord, Lord Clement-Jones, and I have discussed the issue of separate statutory instruments for each exception. As he said, they may have totally different effects and it would be quite difficult for the House to debate one single compendium of exceptions when they may involve very different interests and very different impacts. Mentioning impacts leads me to say that, if there are to be separate statutory instruments for each change passed under this clause, there should be separate impact statements.
Some weeks ago, I collected the impact statement for this Bill from the Printed Paper Office. I have not attempted to weigh it but it is about two inches thick and I must confess that I have not waded through it. Of course, the Bill contains a whole range of issues but one realises that, when departments produce impact assessments on this scale, you have to be a very devoted Peer and have plenty of time to be able to make anything of them. I suspect that some of the changes that may be envisaged as being achieved by order under this clause may be wholly unexceptionable, in which case so be it. However, there may be some which will be very controversial and should be properly debated, in which case they should have a separate impact assessment. That is the burden of the amendment to which I have put my name and I hope that the Minister will take account of it when he responds.
Lord Howarth of Newport
My Lords, the noble Lord, Lord Jenkin, is the most diligent of parliamentarians. If he has not been able to read the impact assessment from start to finish, that illustrates that we have problems in achieving satisfactory scrutiny of legislation.
I support Amendments 28H, 28J and 28JA because I agree with noble Lords who have already argued that it is important that we should look at the relevant statutory instruments one by one, in so far as that is realistic and practical.
I believe that it is realistic and practical for Parliament. There may be problems in that, as has already been suggested, the material contained within different statutory instruments may overlap with other statutory instruments to a degree, in which case one must proceed pragmatically. But it is right in principle that Parliament should have the maximum opportunity to examine secondary legislation. One could say that the more minimalist the primary legislation the more important it is to ensure that the secondary legislation that stems from it is thoroughly scrutinised.
We can be a little too defeatist in Parliament about the scope for satisfactory scrutiny of statutory instruments. When I was in the House of Commons, time was all too limited for examining SIs. As a self-regulating House, we are better placed to ensure that we examine statutory instruments more thoroughly in this House. We have committees of the House that take it upon themselves to do a lot of preliminary work on our behalf. There is a disposition and a considerable ability in your Lordships' House to do this job properly.
We cannot overstate the importance of some of this secondary legislation. The creation of new exceptions to copyright law can have a major bearing on the livelihoods of large numbers of people and on the performance of significant sectors of our economy. We owe it to the public whom we serve that we take the greatest care to ensure that these exceptions are properly formulated.
The presumption should be that each one is embodied in a separate statutory instrument and carries with it a separate impact assessment, which I hope will then be on a scale that the Minister and all the rest of us would be able to manage. I hope that the Minister will be able to give a full and formal assurance that this will be the approach of the Government.
Lord Stevenson of Balmacara
My Lords, I add my thoughts to those that have already been expressed about these issues and have some specific questions in relation to Modernising Copyright: A Modern, Robust and Flexible Framework, the latest publication dealing with the way in which copyright exceptions are to be brought forward, which was published in December 2012.
We have been blessed with substantial impact assessments. Indeed, we have discussed them. Unfortunately, I dropped mine on my foot as I was coming out of my office today and I am still limping as a result. It was really quite heavy. But it was very valuable because I have been reading it and I have got a lot out of it as has been clear in the comments made so far. One of the themes that we have discussed in this series of debates today is how copyright legislation should go forward. In particular, the example that we have had to use, because it is current, is that of the Hargreaves recommendations.
The Government's proposals, as outlined in their modernising copyright report, are that:
“The Government intends to legislate for a new system of permitted acts for copyright works, incorporating the changes discussed in this document. These changes need to be carried through consistently. In the light of stakeholder comments about the degree to which the existing Copyright Act has been amended since 1988, the Government will therefore introduce the system for Parliamentary approval en bloc rather than piecemeal, through the smallest possible number of Statutory Instruments”.
That is not what we are arguing for. We are saying in our amendments that we want more time and more discrete information to be provided. I would be grateful if the Minister, when he responds, could analyse why the Government have said that in relation to the points that we have made.
The Government go on to say that publishing statutory instruments en bloc,
“will help the system be clear and consistent”,
but we would argue quite the reverse. The Government then say:
“For this reason, the Government proposes that all the measures take effect at the same time, the intention being that they come into force in October 2013”,
which is a relatively short time in parliamentary terms. It will be difficult for us to get through all this in the appropriate way, given the sensibility of the discussions.
I support the amendments in this group. We discussed these issues when they were raised in a number of earlier areas. The Government must be in absolutely no doubt at all that these issues are large in the minds of those who have been corresponding with us. It would be useful if we could have a proper statement from the Minister on how things will go forward.
Viscount Younger of Leckie
My Lords, I will deal with Amendments 28G, 28H and 28J first. These amendments are all interconnected.
As set out in the response to their consultation on copyright, the Government plan to make changes to copyright exceptions. They have said that they will make these changes via secondary legislation, and it is the Government’s intention to do so using the powers that exist under Section 2(2) of the European Communities Act 1972, a point that I alluded to earlier this afternoon.
I assure colleagues that the Government will not use Clause 66 to make these planned changes. Bundling any statutory instruments that are needed to implement the proposed changes to copyright exceptions is therefore an issue that goes beyondthis Bill.
However, the Government recognise the concerns laid out in these amendments, particularly in eloquent speeches from the noble Lord, Lord Howarth, and my noble friend Lord Jenkin. Accordingly, in my capacity as Intellectual Property Minister with responsibility for implementing the Government’s policy decisions on copyright exceptions, I will commit to look at how the bundling of statutory instruments could be structured when they are brought to Parliament.
The Government appreciate and support noble Lords’ concerns about allowing adequate time for parliamentary debate and scrutiny. Detailed examination of legislation is the business of the House and I want to make sure that we can create that opportunity. In tandem, in relation to good practice with regard to statutory instruments, the Government are mindful of the views of the Joint Committee on Statutory Instruments, on which Members of both Houses sit.
The Government will also have to consider the potential need to ensure that where exceptions are inter-related they can be scrutinised together. For example, I understand that the copyright exception on private study links with the exception for research and that which permits libraries to copy for the researcher. In implementing these changes, I hope that noble Lords will agree that the Government will also need to be mindful of the administrative burden on creators, businesses and users of copyright exceptions, particularly private individuals, small and medium-sized enterprises, schools and academics.
Finally, when I bring forward the regulations on copyright exceptions, I will provide an explanation in an Explanatory Memorandum setting out the reasons for any bundling of statutory instruments.
Amendment 28JA seeks to ensure that the full effects of any use of this clause are made available for scrutiny. Impact assessments play an important role in the scrutiny of law making. Every statutory instrument laid before this House must be accompanied by an impact assessment. I therefore assure the noble Lord, Lord Howarth, that an impact assessment will be published for each and every use of this clause.
The Government are aware of and sensitive to the strength of feeling around some of the issues raised by these amendments. I hope that noble Lords can be assured that the Government have considered these amendments very carefully and that in light of the above they will be content not to press their amendment.
Lord Clement-Jones
My Lords, I think we are on a bit of a roll. We had better stay here for the rest of the evening and finish off Part 6. We seem to have gone from the beginning of Clause 66 and the Minister's assurances about looking at an amendment that will reflect the previous penalties amendment, to assurances that the Minister will look at this in his capacity as Intellectual Property Minister. He will look at how best these can be dealt with and they will not automatically be put into one bundle.
I understand exactly the point the Minister made about some being linked. Indeed, I made that point when I introduced the amendment.
Lord Howarth of Newport
Does the noble Lord not think that we should be asking a little more from the Minister? We should be asking for an assurance that the presumption will be that statutory instruments will not be bundled and that they will be taken together only when there is a compelling reason by virtue of the interrelatedness of their contents.
Lord Clement-Jones
That is a very fair formulation. Certainly, I was also reassured that the Minister confirmed that there would be an impact assessment for each and every one of the uses of the ECA in these circumstances. I look forward to the proper use of House of Lords scrutiny in these circumstances, to which the Minister alluded, because our scrutiny would be extremely valuable. The interpretation that I put on the Minister’s very useful assurances is very much that formulated by the noble Lord, Lord Howarth, so perhaps if the Minister disagrees with that he could indicate that at the same time.
Viscount Younger of Leckie
That is not exactly how I see it. I confirm that we do not want to prejudge any consideration. This is an ongoing discussion. There will not be a presumption on bundling; we want to talk about this further. So I do not particularly adhere to what the noble Lord, Lord Howarth, was saying.
Lord Clement-Jones
My Lords, the Minister just said that there will be no presumption on bundling, which is a very useful assurance. If I can take that from the table, that might be the most useful way forward. It would be very helpful if, before Report, the Minister could consider this matter further. Then, if such amendments are tabled again on Report, he can consider precisely how he thinks the statutory instruments can be put together, giving us further information about the nature—I shall not use the word bundling—of how those instruments are put forward for these exceptions.
Viscount Younger of Leckie
Perhaps I could just clarify the situation by saying that there is no intention to deliberately bundle.
Lord Clement-Jones
I thank the Minister. So if I see deliberate bundling, we will know that this is completely wrong and should never have happened. In those circumstances, I withdraw the amendment.
Viscount Younger of Leckie
My Lords, before introducing amendments to this clause, I should like first to set out how the provisions in this clause will work. This is a complex area, and I understand some greater clarity may be helpful. At present, certain unpublished works that were created before 1 August 1989 remain in copyright until 2039. This is because of transitional provisions applying when the 1988 copyright Act was introduced. The transitional provisions mean that works such as centuries’ old unpublished letters or manuscripts remain in copyright until 2039. This is far beyond the standard terms of copyright required by the EU term directive 2006. Many of these works are orphan because it is not possible to contact the rights holder, possibly now a long-lost historical figure, to ask permission to reproduce them.
To illustrate the scale of the problem, the National Archives estimate that around 12 million or 42% of the 30 million archival items held in English and Welsh public archives predate 1891. The vast majority of these are thought to be unpublished and would therefore remain in copyright until 2039 under the current law. Clause 67 will allow the Secretary of State to reduce the length of copyright term for these works. But, and importantly, the length of term cannot be reduced beyond the minimum requirements of the term directive. I should like to stress that it is only when the date 2039 is later than the date that the term directive would produce that any reduction in term would occur, such as when 2039 gives more than life plus 70 years for an unpublished literary work by a known author.
For example, the only literary works that could have their terms reduced will be those where the known author died before 1969 or, in the case of unknown authors, where the work was created before 1969. This is because unpublished literary works by known authors will receive copyright protection for the duration of their life plus 70 years from the year they died. Unpublished literary works by unknown authors will receive protection for 70 years from the year the work was created.
In the case of photographs, the only ones which could potentially be subject to a reduction in term are unpublished photographs taken between 1 June 1957 and 1 January 1969. Where the photographer is known and died before 1 January 1969, the new term would become 70 years from the year the photographer died. If the photographer is unknown, the term would be 70 years from the year the photograph was created.
The term directive specifies different terms for different types of works in different circumstances so it is not possible to list them all now. I have a more detailed note available here today, which I will also place in the House Library, of what this means for different works. Many of the works that currently enjoy a longer term of copyright than that required by the term directive are orphan works. Reducing the term of copyright to the usual levels will bring many of these works out of copyright. This will reduce the overall number of works classed as orphan and is part of the solution to the orphan works problem.
The Government are bringing forward two amendments to Clause 67. This follows further consideration on the scope of the clause and in response to the observations made by the Delegated Powers and Regulatory Reform Committee report published on 14 December 2012. We accept that the scope of this clause would benefit from clarification. The amendments will therefore remove the references to “published but anonymous or pseudonymous” works and clarify that the power is limited by the EU Term Directive 2006. We have concluded that most anonymous and pseudonymous published works are unlikely to be subject to the 2039 transitional provisions. As such, these types of work need not be included in the scope of the power. This amendment means that Clause 67 now applies only to unpublished works, subject to the transitional provisions that currently enjoy copyright protection for longer than the standard periods of protection specified in the term directive.
The second amendment makes clear that no work will receive a shorter term of copyright than set out in the term directive. This has always been implicit in this power; this amendment simply provides clarity by putting the matter beyond any doubt. I hope that in the light of what I have said noble Lords will support these amendments. I commend the clause to the Committee. I beg to move Amendment 28JB.
Lord Clement-Jones
My Lords, the Minister introduced his amendment very fairly but I must admit that Clause 67 still baffles me. I think that I understand the term directive. The Minister has produced a splendid schematic of all the different rights that might be affected in these circumstances, especially where copyright will be brought back from 2039. However, I am still baffled to some degree as to why we need to go the whole hog as regards Clause 67. Technically, I suppose that I am speaking to the clause stand part debate. Originally, the clause was much more objectionable. It is now much more clearly tied to the term directive. However, what is the real motivation of the clause? I think that all of us are very sympathetic to the idea of medieval manuscripts and other old material being taken out of copyright so that they can be digitised. However, the museums, the British Library and others have made the point—whether publicly or otherwise—that in practice there are no copyright claims or difficulties and that by and large they have gone ahead and digitised and have not had any problems in doing so.
Baroness Brinton
My noble friend said that museums had found that managed risk had sufficed so far. Does he recognise that the directive is narrower in scope than the Bill and covers only certain works for certain uses by certain organisations? In addition, it does not permit the use of orphan works for commercial purposes, which is within the scope of the Bill, and therefore changes the scope of what is under discussion.
Baroness Blackstone
My Lords, I should declare an interest as chairman of the board of the British Library. The library supports this clause, and I hope that other speakers will do so as well. Unpublished works account for a very large proportion of orphan works and include very old material that remains under copyright. The British Library has examples, going back not to the fourth century, as the noble Lord said, but certainly to the seventh century, which are still subject to copyright restrictions. Much unpublished material is of enormous importance from the point of view of scholarship and some of it is of unique quality. It comprises a large part of the important digitisation project that the British Library has undertaken and wishes to continue. It is important that this clause is retained because it will produce a position where more work of this sort can be digitised and made available to a wider range of people than is currently the case.
Lord Stevenson of Balmacara
My Lords, given the mess that we were in on what constituted bundling and whether it was directed or undirected, I am sure that the Minister’s eyes alighted on this group, particularly the wonderful tables which he has provided for us and which we have read with interest, when he came to speak first on this. He cannot have been helped by the fact that his Chief Whip was hovering around his left shoulder as he was doing so, but he managed to cope with that and he is obviously learning fast on the job.
We have given notice of our intention to oppose the clause, because we were very concerned when reading it and seeing the wideness of the powers. The recommendations from the DPRR Committee have obviously stimulated the department to think again on that, and we are grateful for the amendments introduced by the Minister. But it tells the story that to get his narrative across he has to produce this 12 or 13-page document with tables that classify for us the conditions under which an unpublished opera whose author died in 1920 has to reduce the term by 49 years, at which point the work enters the public domain. I did not know that, and I do not think that many people did know that. Clearly a great deal of education has to be done about this area. I am still slightly uncomfortable that the analytics that have gone into this—and I can think of examples from films, which I am concerned about more directly, or unpublished monographs of engravings when the author has died—leave us with something more complicated than it needs to be, perhaps.
Nevertheless, the context of that is not the issue. The question is whether the power should exist with government to make reductions in copyright in transitional cases. That has been subsequently reduced by the comments of the DPRR, and we are now satisfied with that.
Viscount Younger of Leckie
I thank noble Lords who have contributed to the debate. First, I respond to the noble Lord, Lord Stevenson, to say—I am sure that he knows this, really—that the information that we produced on the illustrated works was for information. It was not our aim to beef up our argument, because we do not believe that we need to do that.
My noble friend Lord Clement-Jones asked whether there was consultation about reducing copyright on published works. I can confirm that this was in the copyright consultation exercise in 2012. An issue was raised about the published works of TS Eliot. We would need to know a considerable amount more information, and I would not be in a position to give legal advice on specific cases. The clause would not reduce the copyrights of published works. On that note, I feel that I have answered adequately the responses from noble Lords.
(a) with the end of the term of protection of copyright laid down by Directive 2006/116/EC or at any later time;(b) subject to that,”
Lord Clement-Jones
Lord Clement-Jones
My Lords, in moving Amendment 28KA, I shall speak also to Amendments 28LA and 28LB. These amendments provide for implementation of the EU orphaned works directive in substitution for the Government’s proposals. The directive provides for non-commercial use of orphan works by cultural institutions. Although the permitted use is non-commercial, the directive allows sales to recover costs. The major question here is why we are going further than the EU orphan works directive, which EU countries have to implement within two years of this September when the directive was passed. It specifically makes provision for museums, galleries, archives and libraries, educational establishments and public service broadcasts to make use of orphan works. These are all essentially cultural institutions. It may not be a perfect directive at this stage, but surely if it will apply in 27 countries, we should build on it. We can, of course, use the new digital hub to good advantage when applying the provisions of the directive.
The Government’s proposals under Clause 68 go much further by permitting exploitation for commercial purposes, which is a matter of real concern to many, particularly the creators of images, where the metadata has been stripped and attribution lost. That is the reason that equivalent provisions failed to get through Parliament under the Digital Economy Bill before the previous general election.
Has no account been taken of photographers’ strong concerns, voiced during the passage of the Bill and in the Hargreaves consultation? The impetus for orphan work licensing comes largely from cultural institutions. The provisions of the directive, therefore, should largely satisfy the need for orphan licensing among those institutions. On 13 September 2012, the orphan works directive was passed, and it must be implemented within two years. Digitisation for preservation and replacement of any work and supplying copies of unpublished work to other libraries, unless the author has forbidden it, is already permitted under current UK copyright law.
On the other hand, the proposed measure in Clause 68 is designed to make orphan works available for commercial exploitation. That measure would deprive rights holders of their property simply because they have not been found by the would-be user of their work, although the Government have not yet formulated the rules and do not intend to publish them until after the measure has been enacted. Being exercisable by secondary legislation, they will not be fully subject to parliamentary scrutiny.
Those are some of the problems which are not dealt with in the measure. Many works contain other copyright works, such as photographs or illustrations. Unlike the EU directive, there is nothing to protect the owners of those copyrights if the overall work is declared an orphan. Diligent search has been used in a number of fields for many years and produces a high level of false orphans. That is because copyright does not have to be registered and there are no definitive registries of the ownership of copyright works. Some types of works, such as photographs and illustrations, are especially easy to separate from the information about their creators—I mentioned the issues about metadata earlier. In particular, foreign copyright holders are likely to be unaware of the provisions and so will be more likely to lose out as others exploit their works commercially in the UK. Primary legislation should not allow orphan works provisions beyond the EU orphan works directive until it has been drafted to give the same standard of protection to creators as are provided under the directive.
Great concerns have been expressed not only by photographers but by a whole range of others, such as AP, British Pathé, Getty Images, ITN, the Press Association and Thomson Reuters, which are UK, European and worldwide news agencies and audiovisual archives; and FOCAL International, which is the industry body representing commercial and audiovisual archives throughout the world.
The provisions in the clause are premature and should not be introduced in the Bill. If there are flaws in the directive—there may well be—surely we should work on them rather than erecting a totally separate definition of orphan works, which will have few equivalents anywhere else in the world and will certainly be of no use in international rights clearance. I beg to move.
Lord Howarth of Newport
My Lords, I shall speak to Amendments 28LA and 28LB, which the noble Lord, Lord Clement-Jones, has introduced. I see these issues very differently from the way that he does. I am sure that he would agree that it would be a pity if we in the Committee excessively polarised the interests of contemporary creators against those of our great cultural institutions and the public, who benefit from the work of those institutions and could benefit so much more if a larger part of their collections were to be made accessible.
The simple answer to the question raised by the noble Lord, both on Second Reading and just now—why we should go beyond the provisions of the European Union orphan works directive—is simply that the directive does not go far enough; it is too limited. Only public sector bodies and educational establishments, not companies, can benefit. That means that public/private partnerships are prevented. Even cultural bodies, are prevented from working in partnership with the private sector. Mass digitisation, which would confer very great benefits for the public, is best carried out with private sector contractors and partners. In that way, the production is made possible for global educational markets.
Baroness Blackstone
My Lords, I associate myself with what my noble friend Lord Howarth has just said. He put it concisely and succinctly, and I entirely endorse everything that he has just put forward. I shall not repeat what he has already said.
I do not believe that Clause 68 goes quite far enough, and I should like it to have gone further. I certainly do not want to see it restricted in the way that the noble Lord, Lord Clement-Jones, suggests. My noble friend is absolutely right when he points to the undesirability of polarising this debate between the needs of cultural institutions, scholars and researchers and the requirement in the 21st century that we should be able to digitise material en masse, which should include orphan works. Until now, it has required huge amounts of time and effort—pointless time and effort—to try to establish who the authors of these so-called orphan works are, usually with absolutely no useful result. Therefore, I very much hope that the Committee will reject these amendments and support Clause 68 as it stands. I hope that when the regulations are formulated, they will be able to maximise the extent to which it is possible for orphan works to be accessed and digitised in the interests of the wider public and of research and scholarship.
Baroness Warwick of Undercliffe
My Lords, while there is a danger of me saying, “Me, too” and sitting down, I would like to reinforce those points. It is worth reflecting on the fact that Universities UK, the British Library and the Wellcome Trust have all explained in considerable detail why the orphan works provisions must extend to commercial as well as non-commercial works. They have certainly convinced me that it is not possible to draw a clear distinction between commercial and non-commercial works—that is, commercial uses in the context of universities, museums and libraries.
We must remember that a very large proportion of orphan works were never intended for commercial purposes. Others have mentioned letters, but I would add personal notes, diaries and even sketches on napkins. Those are the kind of things that make personal archives so rich and such a wonderful source and rewarding ground for scholars. Therefore, I do not think that we should seek to put any barriers in the way of that material being preserved and shared.
Lord Greenway
My Lords, I have every sympathy with the aims of the British Library, the Wellcome Foundation and others. However, I should like to bring the debate back to the photography angle. I am a photographer and there was a time when I used to make my living as a photographer, although I no longer have the time to do that. However, I have a considerable archive of my own photographs and photographs that I have acquired over very many years. In effect, I have what could be termed a small photo library.
I am concerned about this measure because copyright is, and always has been, a minefield. To my mind, what we are doing here risks making it even more of a minefield. What will be the position for the large number of photo libraries which, after all, make their living from selling reproduction rights for photographs? They are worried that they will be badly affected by this Bill. They do not think that there has been enough consultation. There is a risk that, if the Bill goes through as it stands, some of them could go out of business.
I find this business of orphan works difficult to comprehend. I have lots of photographs that could well be orphan works. I have no idea who took them. Some of them are 100 years old and were taken in other parts of the world. Do I have to license all those photographs and pay money into an account that may well build up into a huge sum of money and will be sitting there, most of the time unused, when such money could be used, especially by photo agencies, to increase their business in other ways? I find the whole thing exceedingly confusing. I would welcome the Minister pouring some light on that.
Baroness Brinton
My Lords, I should like to add my voice to the “Me toos” of the noble Lord, Lord Howarth, and the noble Baronesses, Lady Blackstone and Lady Warwick. I do not support these amendments and I support the retention of Clause 68. I will not repeat the very helpful points that were made earlier. Some other points that have been made by the National Museum Directors’ Council show the real problems with making the amendments work. This is not just an issue of not being able to identify or trace the rights holders; any activity requiring permission from the rights holders cannot happen because that in itself infringes copyright. This severely impacts on what an institution can do with the work. For example, a museum may display an orphan work but it cannot digitise that work for display in its catalogue, put it online, advertise it in any other way or have it as part of a picture on a postcard, as was talked about earlier. That makes a much bigger problem. The practical problem is that the work will be put into store. There are 4 million orphan photographs and documents in the Imperial War Museum stores at the moment, and 11 million orphan works occupying 180 kilometres of shelf space—the distance between here and Bath. At the Natural History Museum, there are approximately 125,000 art works and 200,000 notebooks, which they suspect are orphan works, as well as 1.3 kilometres of manuscripts—that is, here to Buckingham Palace.
There is a real problem here, particularly in these times of austerity. Earlier, we discussed the borderline between what is commercial and what is not commercial, certainly for universities, where I have worked for more than two decades, as have the noble Baronesses, Lady Blackstone and Lady Warwick. In these times of austerity, universities and other public organisations are being encouraged to be as commercial as possible and to find other sources of income in order to help to minimise the reliance on public funds. That is also true for the museums, libraries and archives world. The problem with these amendments is that they would make it so complicated that the orphan works would just sit in those stores for ever. Even if we do not know who owns the work, that does not mean that it is culturally insignificant. I believe that the public would be horrified if they thought that such a large number of works were inaccessible and banned for ever because tracing the rights holder, their heirs and successors was impossible.
The orphan works solution is a helpful one that will allow UK museums, libraries, archives and universities to produce much better exhibitions and displays for wider public knowledge and education. I think it will also facilitate the more effective use of public funding and reduce the almost impossible task of tracing the rights holders of some of these works. I pick up the point made by the noble Lord, Lord Greenway, just now about what happens to accumulated funds, but frankly that is something that the Government need to address. It is right that there should be protection for rights holders, and I think that the organisations that we have mentioned this evening are more than happy to pay a licence fee that reflects the commercial nature of an item where it is clearly very commercial, but I remain concerned that where there is no commercial rate, even a very small fee for an item in a museum might make the museum decide not to display it.
Finally, I pick up on the point made by the noble Lord, Lord Clement-Jones, on the EU directive. It is only a partial solution to the orphan works problem. It does not allow, for example, the models of public/private partnership that would fund the digitising of large archives; nor does it allow for any revenue-raising activities using orphan works. The revenue raised is limited to the cost and preservation of the item, or to making it available to the public. The EU directive on its own does not recognise the reality of public-private boundaries in our top universities, museums, libraries and archives today.
Lord Lucas
My Lords, I am not going to give any comfort to my noble friend Lord Clement-Jones on this, I am afraid. There is an awful lot to be gained from the orphan works clauses in opening up our cultural heritage and allowing us to share it. We absolutely need that to be a commercial enterprise as well as a public enterprise. For those who are active and fear that their works, particularly photographs, are going to become part of someone’s orphan collection, I say that there are things out there on the internet. There is TinEye for photographs, Shazam for music and Turnitin for text. All you have to do—and presumably the Government will do this when they come to say what diligent research is—is to make sure that you have registered your photographs with TinEye and then they can be found. I can recommend Shazam to anyone who does not have it as an app on their smartphone. It listens to the music and will tell you who is playing what. The tools are there. We do not have to wait for the copyright hub, although that will be useful when it comes. It merely uses these tools as ways of identifying the music or the photographs. We have the means, as long as people declare themselves to be a copyright owner, to make sure that they are found.
Lord Stevenson of Balmacara
My Lords, I find myself in agreement with everyone except the noble Lord, Lord Clement-Jones, on this point. I am not following his line on this one and will not be saying, “Thank you”, “Oh, yes” or whatever he wishes me to say at the end of the debate.
However, there are a couple of things that are worth picking out of this very good debate. The question of photography and photographers is not yet well resolved. That is true in general terms because, in particular, the metadata problem affects photographers more than anyone else, and we have to be very sensible about that. When he comes to respond, I should be grateful to have the Minister’s comments on whether he foresees any particular difficulty there.
Like other noble Lords, I have received a number of communications from photographers in recent weeks. One of them, from Leon Neal, struck me as being of particular interest because the argument being made is that the impact that this clause will have in relation to photography is substantial. I think we take that point, but he points out that a number of the decisions that will be affected will be very dependent on whether the copyright hub works. In saying that, he wonders whether the Government have in mind giving the copyright hub a chance to get going to see whether it has a solution for the particular problems of photographers that would decrease the requirement for this legislation to be as prescriptive as it is. I am not sure whether I can agree on the basis of this correspondence, but it is something that the Minister should reflect on, and perhaps he can come back to it at that stage. Leon Neal wrote: “I request that you please support the proposal to delay the directive implementation until the October 2014 deadline and then only implement it to relieve any of the restrictions that the copyright hub has failed to address”. That seems a very sensible suggestion.
In line with that, we are aware that the way in which the Government are progressing on this is to take the powers that are set out in Section 68, which we broadly support, and work out the details of the scheme to be brought forward through, presumably, secondary legislation at a later stage. In order to help them with that, they have set up a collective licensing working group, which is presumably also looking at orphan works. The group meets regularly, I understand. It has been going for four months, so perhaps it has not got very far in its discussions. The list that I have seen includes publishers, authors, visual artists, musicians, broadcasters and potential users of the schemes, which all seems very good. Of course, there is a missing group: photographers. When he comes to reply, will the Minister give us some assurance that photographers’ interests—perhaps he should co-opt the noble Lord, Lord Greenway, to his discussions—can be taken into account?
Viscount Younger of Leckie
My Lords, Amendment 28LA would limit the scope of the UK orphan works scheme to that of the EU directive on orphan works. The proposed UK scheme in Clause 68 is intended to complement the EU directive. The exception provided for in the directive is more narrowly focused on enabling the cultural use of orphan works, specifically the digitisation of, and cross-border online access to, orphan works in libraries and archives. The directive does not prohibit the UK developing a domestic scheme for licensing orphan works within the UK.
The noble Lord, Lord Howarth, raised the issue of whether the EU directive can be widely used. I agree that the range of the EU directive is extremely limited. The same sentiments were expressed by my noble friend Lady Brinton. It would not be adequate for the purposes of copyright licensing as proposed by Richard Hooper’s work. Use of orphan works under the directive is limited to publicly accessible libraries, archives and public-sector broadcasters. The directive also allows for the generation of revenue to cover only the costs of digitising orphan works that are made available to the public. This does not allow any kind of distribution, such as publication in a book or TV programme. The directive also does not cover photographs, which make up a significant proportion of the orphan works held by archives, libraries and museums.
The Government’s proposals are about opening up the commercial and economic potential of orphan works. It was clear from the responses to the Government’s copyright consultation that there are many desirable uses that could be made of orphan works which would have a commercial element—for example, reproductions in exhibition catalogues, books or television documentaries.
Because the UK scheme would allow broader commercial as well as non-commercial use, we are proposing a key extra safeguard which is not in the directive. This is the requirement for the diligent search to be verified by an independent authorising body. Allowing commercial use of orphan works will not undercut the market for non-orphan works. In many cases, there is unlikely to be a comparable non-orphan work that could be used instead—for example, unique records of historical events. In any event, the Government’s proposals will provide for remuneration to be set at a rate appropriate for the type of work and its proposed use.
Amendment 28LB would remove four paragraphs from Clause 68 in respect of the proposed orphan works scheme. These paragraphs set out various issues that the regulations either must or may cover and contain the key safeguards for rights holders that will underpin the scheme. This includes the fundamental safeguard that a diligent search for rights holders must have been undertaken before a work can qualify as orphan. My noble friend Lord Clement-Jones, asked whether foreign rights holders would lose out. I can confirm that a diligent search will be needed to check for foreign rights holders, too.
Another key safeguard that the amendment would remove is the requirement that the orphan works authorising body must be independent and therefore cannot license itself to use an orphan work. The regulations could still contain such safeguards even if they were removed from the Bill. However, the Government’s view is that these safeguards are such an integral part of the proposals for an orphan works scheme that they should be set out in the primary legislation.
I pick up the point that the noble Lord, Lord Greenway, raised about the future of photography libraries. The orphan works scheme will help photo libraries because it will enable them to use orphan works legally. The noble Lord, Lord Stevenson, also raised the issue of photographers, and I can assure him that photographers’ interests will be taken into account.
The noble Baroness, Lady Blackstone, recognised that there is a difficult distinction to be made between commercial and non-commercial uses, and I thank her for that helpful intervention.
In the light of the above, I ask the noble Lord to withdraw his amendment.
Lord Clement-Jones
My Lords, I thank the Minister for his reply, and other noble Lords for their not always helpful responses. I was very struck, however, and think it very telling that the noble Lord, Lord Greenway, raised the concerns of photographers. That is really at the heart of much of the objection to the proposals for the orphan works legislation, but it does go wider. As I mentioned earlier, it extends to the news agencies and photo libraries, which have very strong concerns, particularly because at the moment—and despite what the noble Lord, Lord Lucas, said—we do not have the copyright hub fully in place. That would make a huge difference to the ability to carry out diligent search and identify circumstances where metadata has been stripped from contemporary photographs, which have effectively been turned into orphans. This is one of the problems. Photographers are worried about the possibility of a cynical exercise whereby a photograph is turned into an orphan by stripping the metadata, and, lo and behold, the diligence search is inadequate and it is treated as an orphan. There are uses for commercial purposes, not just by cuddly museums, universities and cultural institutions making an honest penny out of books in their shops, but by fully commercial publishers. So there is considerable concern, and it is not a question of polarising the debate but recognising the concerns underlying these orphan works proposals, which are held by substantial numbers of creators and rights holders. The European directive is, as I said clearly, not perfect in every respect, but to allay the fears of many it is better to build on that than have legislation that explicitly goes far beyond what has been said.
Clearly, I will not win the argument today—certainly not in the light of the Minister’s response. I am worried about foreign rights holders; I do not believe that diligent search will be that straightforward where foreign rights are concerned. I think that the IPO will find that a lot of concern is expressed as the regulations and the clause come into effect. It has already been expressed in letters to the Secretary of State and to the former Intellectual Property Minister. I suspect that the volume of correspondence from those foreign rights holders will increase over time.
I will read carefully what everyone has had to say. It may even be that I come back with a suitable response on various issues that have been raised here today. I believe that digitisation is a great deal more straightforward than it has been alleged today. For instance, my noble friend spent most of the time arguing for orphan works. At no point in this debate have I argued against the concept of orphan works; I think that they could be usefully employed, constrained within the right limits. In the mean time, I beg leave to withdraw the amendment.
Lord Clement-Jones
Lord Clement-Jones
My Lords, I thought that the Committee might appreciate, rather than approve, a rather different approach to the clause, trying to make the best of what I previously described as not optimum relative to the orphan works directive.
A number of matters should be written into the Bill. That is essentially what I propose in my Amendments 28L and 28M to 28S, 30 to 32 and 57. Let us assume that it is possible to amend the orphan works provisions satisfactorily. The most important question in that context was how the licensing system needs to operate. The system needs adequately to protect the interests of the orphan works copyright owners and to be efficient and cost-effective. It is vital that the operation of a licensing system is planned in a pragmatic way that considers the needs of different licensees of orphan works. One way to ensure the efficiency of the system is to make the best use of the existing licensing systems of collecting societies. Collecting societies are in a position to process complex usage data and allocate fees for such licences as broadcasters.
UK Music and the Publishers Association, which are supporting the amendments, are keen that the Government fully explore the way that collecting societies participate in the licensing process. It is important that any orphan works licensing scheme includes certain safeguards to protect the authors’ rights. The regulations described in new Section 116A set out certain conditions under which a licence to use an orphaned work may be granted. However, there is not enough detail in the Bill. The amendments provide that detail. To avoid confusion, I should say that Amendment 28S is part of this group.
First, the licensing body must be representative of a substantial number of copyright owners for the type of work for which a licence is to be granted. It must not represent just a minority of relevant creators. It is not at all clear who or what the person or persons authorised to grant licences under the new Section 116A will be. Should it not be a relevant collecting society, rather than the UK Copyright Tribunal?
Lord Howarth of Newport
My Lords, these amendments have at least enabled us to discuss some very important issues. I want to concentrate on the question of diligent search. Whether the proposed United Kingdom orphan works licensing scheme will work depends on whether the regulations ensure that the requirements for diligent search are proportionate and manageable. Unless the time and cost of diligent search are reduced in appropriate circumstances for cultural and academic institutions they, for the most part, will not bother to attempt to use the orphan works in their collections. The noble Baroness, Lady Brinton, briefly described the scale and quantity of orphan works that it is believed are in our national collections. It is thought, for example, that some 50% of archive collections consist of orphan works. There are three very interesting and helpful pages in the impact assessment. I keep on praising the impact assessment—counter-culturally—which gives instances of the scale of orphan works in particular collections and the prodigious volumes of time, effort and cost that would be required to perform a diligent search item by item on all of them.
If the regulations are to be proportionate, they will take account of the nature of the work in question, for example whether it was originally produced for commercial purposes or was unpublished; the use that is proposed for the work—whether, for example, it is intended that there should be free access to it for educational or cultural benefits to the public; a realistic assessment of any risks to potential rights holders; and the feasibility of tracing rights holders. I understand it is the Government’s intention that there should be proportionality in the way the regulations stipulate the requirement for diligent search. However, I would be grateful if the Minister could enlarge on the Government’s intentions in this regard. I hope he will be able to give some comfort to those of us who believe it is important to remove unnecessary obstacles to making orphan works accessible.
Amendments 28M and 28N are totally unrealistic. To require a diligent search for each individual work, regardless of the practicalities, would make digitising orphan works in major areas impossibly time consuming and expensive. Therefore, that would be unreasonable and disproportionate. I hope that my noble friends will not wish to pursue amendments to that effect. I hope the Minister will be able to give us comfort in what he tells us about the Government’s intentions in this area.
Baroness Warwick of Undercliffe
My Lords, I also comment on the question of diligent search. I agree that we need clarification about what will constitute diligent search, but I would worry if we set the bar too high, and these amendments ask us to set a very high bar indeed. Many noble Lords appreciate the time and effort involved in tracing the authors of some categories of work. It is essential that this is proportionate to the type of material involved and the likelihood of finding the owner.
As my noble friend Lord Howarth has said, if we do not establish a proportionate system, the requirement will act as a disincentive to use this legal route for using orphan works. Users will either risk infringement by using works without a licence, as some currently do now, or decide not to use the work at all. We have talked a lot about balance this evening. Clearly, we need the right balance in this case. That is the way the working group is already moving and that is the right approach.
Baroness Brinton
My Lords, in the interests of time, I really will just say “me too”. I very much support the comments made by the noble Lord, Lord Howarth and the noble Baroness, Lady Warwick.
Lord Clement-Jones
My Lords, I realise that I failed to speak to Amendment 30, so if I may I will just finish this group.
An orphan works license must provide remuneration for relevant rights holders, specifically the holding of money in escrow to remunerate rights holders who come forward within a certain time period. New Section 116C(4) of the Bill states:
“The regulations must provide for the treatment of any royalties or other sums paid in respect of a licence”.
That is welcome, but could be much clearer using the more broadly recognised term of “remuneration”. While royalties are common in the music industry, in the publishing industry royalties are used to describe payment made solely to authors. The word “remuneration” is also preferable for the avoidance of doubt as distinct from compensation, which would suggest a need for rights holders to prove harm before being able to receive their monies.
Lord Stevenson of Balmacara
My Lords, I want to make it clear that we on this side support the ECL approach in general. The reason for supporting these particular amendments is to make sure that the issues that they raise are probed. I look forward to hearing what the Minister has to say.
However, it is worth putting on the record that there are still a lot of reservations from individual authors and photographers about the potential impact of an ECL scheme, particularly where there is not a collecting society—
Lord Clement-Jones
If I can clarify, we are still on orphan works amendments, which are designed to improve the orphan works provisions in the clause.
Lord Howarth of Newport
Before the Minister responds, the noble Baroness, Lady Blackstone, apologised that she had to depart from the Committee because of a commitment, but she asked me to say that, as chair of the British Library, she associated herself with the points that I put forward in my remarks.
Viscount Younger of Leckie
My Lords, the amendments cover both the scope and detail of the proposals for a UK orphan works scheme. Amendment 28L would limit who could be authorised to grant licences to use an orphan work and de facto would mean that only a collecting society already operating in the sector could be authorised to grant licences. The amendment assumes that all orphan works will be licensed by collecting societies. However, many orphan works are simply not of a type that is licensed collectively—unpublished works, diaries, old photographs and oral history recordings, for example. There will therefore need to be a separate independent authorising body for orphan works which are not covered by any collecting society.
Amendment 28M seeks to make clear that the orphan works scheme applies to a work where there are multiple rights owners and one or more of these are not known or cannot be traced. The Bill already makes provision for this. The requirement for a diligent search for the copyright owner will be described in greater detail in the regulations. This will include all relevant rights-holders where there is more than one.
Amendment 28N would mean that a separate diligent search had to be undertaken for every orphan work that someone wants to use. The clause already provides that a work must have been subject to a diligent search for the rights holders before it can qualify as an orphan work. However, requiring a separate diligent search for each individual orphan work could result in potential licensees having to conduct repetitious searches. For example, five poems by the same poet whose name is known, published by the same publisher, would require five separate diligent searches.
Amendment 28P is concerned with creators who have assigned some or all of their copyright in a work that goes on to be a suspected orphan work. The diligent search for rights holders will cover all potential rights holders in a work, including the creator. This amendment would also provide an author with a new right to remuneration for the use of an orphan work, even when the author had assigned the relevant copyright in the work to someone else. Only those who are rights holders will be entitled to remuneration for the use of an orphan work. This is exactly the same as for non-orphan works.
Amendments 28Q and 52 seek to clarify what the term “authorised” means in this subsection. In particular, they seek to ensure that those authorised to license orphan works cannot grant themselves a licence. This is an important point and one on which the clause is already clear—in new Section 116A(5)(c) introduced in Clause 68. Any body authorised to issue orphan works licences cannot license themselves to use an orphan work.
Amendment 28R would mean that a licence to use an orphan work must be time-limited and not run beyond the copyright term in a work. I can confirm that regulations will provide for limits for orphan works licences. These will be appropriate to the type of use being licensed and could be a time limit or a limit according to intended use—for example, a print run. In reality, sometimes it will not be possible to tell whether the copyright in an orphan work has expired.
My noble friend Lord Clement-Jones spoke to Amendment 28S, which I shall address at this point. The amendment seeks to clarify that orphan work licences can be granted even when it is not known whether an exclusive licence has been granted. An orphan works licence may be granted where a diligent search does not find all the relevant rights holders, including an exclusive licensee. The noble Baroness, Lady Warwick, raised this particular issue. Where the diligent search reveals the existence of an exclusive licence, the work will not qualify as an orphan work. Where an orphan works licence is granted following a diligent search but subsequently an exclusive licence holder appears, the exclusive licence holder will be treated in the same way as any other absent rights holder that appears. The detail of this will be set out in the regulations. That is why the clause specifically applies to cases where it is uncertain where the copyright subsists.
I turn to Amendment 30. This concerns the very important issue of remuneration being set aside for rights holders when an orphan works licence is granted. I can set on the record that the regulations will provide for the treatment of remuneration. I also draw my noble friend’s attention to the wording in the clause:
“The regulations must provide for the treatment of any royalties or other sums paid in respect of a licence”.
I believe that the term “royalties” is not used in all sectors but it is understood in the Bill to mean the same as “remuneration”. The phrase “other sums” would also cover any other types of fees to be set aside for rights holders. Therefore, the Government’s view is that the clause already provides for remuneration to be dealt with by the regulations.
I should like to pick up one point made by the noble Lord, Lord Howarth. He asked whether there will be proportionality in undertaking a diligent search. I hope that I have that right. Much work is already being undertaken in diligent search work for different types of work. This is being considered by the working group, which includes representatives of museums, libraries and archives.
I hope that in the light of the explanations and assurances that I have given, the noble Lord will agree to withdraw the amendment.
Lord Clement-Jones
My Lords, I thank the Minister for that helpful reply. His speech will certainly need some studying but he gave a number of assurances which were very helpful, particularly those concerning the content of the regulation, the explicit statements about what the regulations will contain and, for the purposes of Pepper v Hart, how the relevant provisions should be interpreted as far as remuneration is concerned. Therefore, I think that there are some useful points in there.
I must disagree with the Minister and with the noble Lord, Lord Howarth, about the way that one interprets each individual orphan work in terms of the clause. If it were going to be laborious, there is a point to be made there. But this is designed simply to make sure that there is no job lot of orphan works clearance; then the licensee can simply say, “We did our best, but it was a bit of a potpourri or collection of works that we had to clear, so we took a few here and there”—rather like a raffle. There is a point to be made there, and it needs clarifying still, so I may come back to it. The wording may not be sufficiently clear, but it is one of the real issues that many rights holders have, that everything will be thrown into a pot and some search will be made but it will not be sufficiently diligent because it will not have been done in respect of each individual work.
I thank the Minister for that response. I thought that it was a useful mini-debate about the way in which the orphan works provisions can be improved. In the meantime, I beg leave to withdraw the amendment.
Lord Clement-Jones
Lord Clement-Jones
My Lords, I move this amendment on the basis that noble Lords wish to carry on beyond eight o’clock. As I say, my speech will last seven or eight minutes. This group is entirely devoted to the issue of extended collective licensing and seeks to amend Clause 68. First, I will deal with Amendments 28T to 28Y and 52 to 56. Then I will speak to Amendments 28SA and 28AA.
Extended collective licensing is a system whereby a collecting society can extend its licences to include the works of non-members. Non-members will be able to opt out of the licence if they choose. There are mixed views ranging from tepid to hostile in the creative industries. Nevertheless, all see the following safeguards as crucial in any ECL system that is introduced. Extended collective licences must be permitted only in certain strictly controlled circumstances. For example, a collecting society that grants them must be representative of rights owners in the field. Licences must be granted on a scheme-by-scheme basis and the mechanics of opting out should be clearly prescribed. Although the Government’s policy documents and verbal assurances have indicated that such strict conditions will be imposed, they have not been placed in the Bill. This is alarming for rights holders as they therefore do not have a cast-iron, future-proofed assurance that the power in the Bill will not at some indefinite point be used in a way that results in secondary legislation unfairly interfering with their exclusive rights, which are the preserve of primary legislation.
Extended collective licensing allows for collective licences to be granted by a collecting society in respect of all works of the type for which it is authorised whether or not it has the mandate with respect to each individual work. So, for example, a collecting society for publishers could be granted the ability to license literary works by publishers with whom it did not have a direct relationship. ECL schemes would also allow collecting societies to issue non-exclusive licences for particular uses of works beyond the uses covered by the scope of its rights holder mandate. So, for example, a society could issue a licence to a third party to allow the digital reproduction of works by a member publisher even where its mandate did not provide for this use. As such, ECL can potentially deprive rights holders of the ability to make a choice as to how their work is exploited. Collecting societies are permitted to go beyond the scope of mandated agreements and therefore act without the direct permission, and perhaps without the direct knowledge, of the rights holder. The rights holder who wishes at the outset not to be subject to such treatment would be required to opt out of the licensing scheme—the direct opposite of the present situation whereby they opt in. This important shift of onus on rights holders is a serious inversion of their position and requires a greater level of vigilance and monitoring. For many smaller rights holders this may well prove a very onerous burden.
If ECL is to be introduced, the creative industries therefore believe it is vital that additional safeguards are set out in the Bill to protect rights holders as much as possible from unauthorised and undesired use of their works. The Publishers Association, UK Music and many others believe that a licensing body should be granted an extended collective licence only if the following conditions are satisfied. First, the licensing body is significantly representative of UK rights holders in the field concerned. Secondly, the authorised licensing body has adopted a code of practice which gives members and non-members equal rights. Thirdly, an application has been made and a separate licence granted for different uses of works. Fourthly, the Secretary of State is satisfied that the licensing body is acting with the approval of its membership. Fifthly, members and other interested parties have had the opportunity to comment on ECL applications under consideration by the Secretary of State.
Amendment 28SA adds necessary safeguards to the ECL provisions in new Section 116B. A licence limited to the provisions as drafted could breach the requirements of the Berne Convention and TRIPS agreement in relation to non-UK works. This is inherent in ECL and cannot be cured. Nevertheless, this amendment gives extra protection to right holders if ECL is introduced. It is argued that copyright licensing is administratively burdensome on those who wish to use copyright works and should be streamlined. ECL is presented as the means by which the Government can sort out this situation. However, the industry is rapidly bringing its own digital solutions to the marketplace.
A collective licensing scheme is a voluntary arrangement in which owners of a particular kind of copyright authorise a collecting society to enforce those copyrights on their behalf. Yet the scheme proposed in Clause 68 resembles a form of compulsory licensing under which the Government will authorise a licensing body to grant licences for works which neither it, nor anyone who has authorised it, owns. ECL is stated to be voluntary on the part of a rights owner in that he can opt out of the scheme after it has come into being.
However, opting out is possible only if a rights owner knows about the scheme and how it may license its works. Those unlikely to know about ECL schemes licensing their works will include amateur creators whose works are on the internet, although they are not published commercially, and foreign rights holders. In the view of many, the existence of such a body will artificially distort the market for rights, as its rates would become the de facto standard against which negotiations would take place.
Properly, ECL refers to a statutory scheme that extends the collective licence to those rights owners who have chosen not to join the scheme. It is impossible to extend a collective licence that does not exist. Several economically significant sectors within the current creative industries have no collective licensing scheme at all. That includes news clips, films, photographs and illustrations. Those who have argued for ECL point to the Nordic countries, where there are ECL schemes. However, those schemes are very limited in their type of work and rights licence, and there are major differences between the small Nordic and large UK copyright markets.
The Nordic collecting societies are well regulated, and the extended collective licence schemes are narrowly limited in scope and subject to strict parliamentary scrutiny. Cinematographic and dramatic works, as well as computer programs, all of which are types of work of which minor use has great commercial value to the copyright owner, are generally excluded. However, the UK proposal is not limited in scope with respect to either use or types of work.
Any introduction of an ECL scheme must be compliant with the UK's international obligations, including the three-step test. The proposals are not compliant in special cases, the first step; can conflict with normal exploitation of the work, the second step; and can unreasonably prejudice the legitimate expectations of creators, the third step. It is inevitable that, if passed, the provisions will be challenged in the courts.
Finally, ECL is proposed to solve perceived copyright licensing problems, which the copyright hub, to which I and many other noble Lords referred, is intended to solve on the basis of voluntary participation without confiscation of property rights by secondary legislation or any legislation. If ECL is proposed again, surely the primary legislation must contain the minimum safeguards to comply with international norms.
I apologise for the length of my speech, but I did warn noble Lords. Amendment 28AA was proposed by the Association of Authors’ Agents, which is a voluntary trade association whose membership comprises 102 British literary agencies. It suggests that there should be a requirement in the Bill that customary warranties be made to any users being granted licences to use works under an ECL scheme. In a publishing contract, an author usually makes the following warranties to the publisher: that he has full right to enter into the agreement; that the work is an original work written by the author; that the work in no way infringes any existing copyright; that the work contains nothing unlawful, indecent or libellous; that it does not infringe any right of privacy, confidentiality or intellectual property rights; and that any recipe, formula or instruction contained in the work is accurate and is not injurious to the user.
Without those warranties, it is difficult for works to be exploited commercially. There needs to be some provision for at least the basic warranties to be provided under an ECL scheme.
Finally—as your Lordships will be pleased to hear—on Amendment 20AB, the schedule sets out some welcome provisions for any orphan works or extended collective licensing schemes that come into force. However, as Sections 116A and 116B make clear, orphan works and ECL are two quite separate licensing schemes, governed by different qualifying criteria, authorisation processes and provisions. The schemes are not interdependent in any way. For the avoidance of doubt and to reinforce the distinction between the two schemes, I have tabled Amendment 20AB. I beg to move.
Baroness Buscombe
I rise briefly, given the hour, wholly to support the amendments tabled by my noble friend Lord Clement-Jones. This is an area that I focused on in my Second Reading speech. Without wishing to repeat what my noble friend said, there is something rather disingenuous about saying that this system is voluntary but, at the same time, you have to opt out. I know there is huge concern across the industry with regard to this clause on extended collective licensing. It is important that the Government recognise that there needs to be more clarity around how this system would work. There are big questions about how much such a scheme would be policed and regulated with, I understand, just £10,000 per annum earmarked to administer it, and whether extended collective licensing bodies could license content for the internet, meaning that ECL will spill well beyond these shores. I believe that any new system should be opt-in only. It should be limited to a specific remit, such as extended collective licensing for non-commercial use and orphan works.
Lord Howarth of Newport
My Lords, there is a mass of significant matter in these amendments. It is, perhaps, a rather unfortunate degree of bundling that we have them all together. It is particularly unfortunate that the Committee is attempting to deal with them at this stage of the evening. There is important material here that we should not be trying to address under this sort of pressure of time. Noble Lords will be glad to know that I do not intend to comment on each amendment now. I simply want to say a word about Amendment 28SA because I believe it is singularly important. Its effect would be impractical and destructive. As Universities UK has explained to us, limiting the scope of extended collective licences to the UK would require users to manage different territorial permission for some works from a licensing body and not others. It would mean that much broadcast or digital use of these works could not be sold abroad or put on the web and would effectively render extended collective licensing unworkable. The British Library concurs in finding these amendments unmanageable. This amendment also raises issues with regard to existing licences from collecting societies that are de facto extended collective licences that support business and education and already allow use outside the United Kingdom, so, unintentionally, I am sure, this is a wrecking amendment.
Lord Greenway
My Lords, I, too, reiterate what the noble Lord, Lord Howarth, said. It is entirely inappropriate for the Committee to be discussing these important amendments at this stage of the game. Like the noble Lord, Lord Clement-Jones, I would like to have made a much longer speech. I shall not, for which noble Lords will, I am sure, be grateful, but I reiterate the great concern of the British Association of Picture Libraries and Agencies regarding ECL. It is keen to ensure that ECL will not supplant an existing framework to manage image rights. I shall not go any further than that, but this subject needs much greater concentration rather than rushing it through at this stage of the evening. On that note, I shall sit down, but I am not happy.
Lord Stevenson of Balmacara
My Lords, I shall speak to Amendment 28WA. The key issue is whether it may be necessary to broaden the remit of an existing licensing organisation and, if it is necessary, I hope the amendment will do what is required to achieve that. The background to this amendment is to try to open up the archives of the BFI, in particular, but also those of other agencies that hold film and broadcast material. The power of film to transform the way we see the world around us and understand it cannot be underestimated. Britain is one of the world’s greatest film cultures and has a heritage dating back to the very first days of the invention of film. We believe that every young person, regardless of where they live or where in the UK the archive material is actually held, should be able to access and learn from this heritage. Film has significant value as a teaching tool for many different subjects, as well as having a value in its own right in its artistic content. If it is true that the innovators and creators of tomorrow can be found in our education sector, we believe they should have access to film of all ages, much of it stored in publicly managed archives and in copyright and other related materials, just as they have access to libraries of printed words.
The Bill contains a proposal for extended collective licensing that will make it easier and more practical to mass-digitise archive material, particularly for educational access use. That is to be welcomed. However, this change to the law will not be relevant to film or the moving image more generally, as currently there is no collecting society or agency available to license film and moving image material under copyright for educational use. As the Minister will know, Section 35 of the Copyright, Designs and Patents Act 1988 provides an override to the exception which allows broadcasting material to be licensed for use by educational institutions. This scheme has been operated by the ERA since 1990, and it helps copyright owners and performers to derive an income from the licensed use of their literary, dramatic, musical and artistic works. This is extremely valuable, but the ERA’s remit is limited to broadcast material which was recorded after the commencement of the Act and does not cover film. Most educational organisations are covered under the ERA licence scheme, which is renewable annually. It allows teaching staff to record the broadcast output of ERA members for non-commercial educational use.
One simple way to introduce collective licensing to film would be to extend the remit of an existing society, which could be the ERA, to include film and also pre-1990 television broadcasts that are not covered under ERTA licensing. In the age of convergence, it makes little sense to maintain different approaches between film and television. This solution will benefit rights holders, whose interests will be protected as they see a resurgence of educational interest in their creative work and an extended shelf life for their former work, as well as a new income stream. Also, existing education users who are already paying subscriptions will see the value of their investment considerably increased through access to wider audio-visual collections.
Is the Minister confident that the existing text of the Bill will deliver this outcome? If this is not the case, could he consider what is being proposed in my amendment as a way to provide a suitable solution that covers extended copyright licensing to the audio-visual sector?
Viscount Younger of Leckie
My Lords, this group of amendments seeks to add further detail or limitations on the face of the Bill regarding the operation of any schemes for orphan works licensing and extended collective licensing.
Amendments 28T and 53 would prevent an ECL authorisation from applying to works where any part of the copyright was owned or controlled by the collecting society or its member. The idea behind this is to prevent a collecting society from unilaterally extending its mandate. In addition, Amendment 28SA specifies that ECL authorisations could extend only existing licences, and only for use in the UK. The Government agree that ECL should not be used to unilaterally extend existing mandates from members. We do not believe that the current drafting will permit this. This is due to the Copyright, Designs and Patents Act 1988, which provides that ownership of copyright refers to ownership of any aspect of copyright. The Government have been clear that no ECL application can proceed unless the applicant has the explicit support of its membership. It is extremely unlikely that support would be forthcoming for an application which significantly extended the mandates of a collecting society.
With regard to the reference to “owned or controlled” in these amendments, the Government understand the intent to reflect the range of arrangements that may not be captured by the word “owned”. However, the amendment could cover a range of possibilities, including voting rights in a collecting society or influence over the registered owner, and risks preventing legitimate uses of ECL arrangements.
I can confirm that the Government will consider the issues raised here through our stakeholder working group, which includes representatives of rights holders, including several photography groups, libraries, archives and other potential users of ECL schemes, as well as collecting societies. However, the ECL scheme needs to be flexible enough to respond to changing market requirements, so any provision that proves necessary should be made in regulations.
With regard to Amendment 28SA, the Government are pleased to confirm that these provisions can apply only to the exploitation of works within the UK. I also reiterate the Government’s view that ECL authorisations should be granted only as an extension of an existing mandate from a licensing body’s members.
Amendments 28U, 28W, and 54 add new conditions, which must be met before an authorisation to run an ECL scheme can be granted. These conditions accord fully with stated government policy. First, ECL schemes can be approved only where the collecting society is significantly representative of the type of rights holder affected. Secondly, the application process will closely consider the extent of existing mandates, ensuring ECL is introduced only where there is clear support for collective solutions. Thirdly, ECL schemes will require the explicit consent of the applicant’s members. This ensures that rights holders have an effective right of veto. In practice, we anticipate that a collecting society will be required to ballot its members before applying to operate an ECL scheme. This, I submit, is a more specific and effective safeguard than is offered by these amendments.
Amendment 28WA would specify that an authorisation to operate an extended collective licensing scheme could be used to grant licences for the use of audio-visual works for educational purposes. I can confirm that the power in new Section 116B is designed to enable licensing bodies to apply to operate extended collective licensing schemes for specific uses of copyright works. Nothing, including educational uses of audio-visual work, has been ruled out as long as rights holders want it. A central pillar of our policy is that it is up to the collecting society, acting with the consent of its members—the rights holders—to choose whether to initiate an application and to define what they would like to see in scope. Government have no power to do so.
In the case of audio-visual, although there is currently no single collecting society that could cover the range of rights, there is nothing in these provisions that would stop several collecting societies collaborating to offer a joint licence. Indeed, there is already precedent for such collaboration in collective licensing. For example, the Copyright Licensing Agency already offers licences on behalf of both authors and publishers. The only restriction on this would remain that, for such an application to succeed, the licensing body would need to meet the safeguards in the Government’s proposals. It would need to demonstrate that it was significantly representative of the type of rights holders affected by the scheme, and it would need to secure explicit consent from its members for the application.
For audio-visual works, these thresholds would need to be met in relation to each of the various groups of rights holders who contribute to such works. This is crucial to ensure that ECL is introduced only where it works in the interests of rights holders. The noble Lord also asked when provision could be made in relation to this power. Subject to the passage of the Bill, the Government would look to make regulations as soon as possible. It is our hope that licensing bodies that wish to apply to operate ECL schemes will be able to do so from 2014 onwards.
The second part of the amendment raises the question of whether pre-1990 broadcast works would be in scope for educational use and learning purposes. The Government believe that the exception in Section 35 of the CDPA, which this refers to, may already apply to pre-1990 works, but our legal team will be considering this in more detail when preparing the legislation on exceptions. I am pleased that the noble Lord is thinking about the benefit that extended collective licensing could have in some sectors. I hope we have assured him that the type of use he suggests would already be possible under the Government’s proposed scheme.
Amendments 28V and 55 would mean that authorisations for ECL schemes must specify the use of works allowed under the scheme. The existing proposals already address these concerns. The Bill already requires ECL authorisations to set out the types of work and the acts restricted by copyright to which they apply. In October, the Government deposited a briefing document in the House Library including further information on how ECL will work in practice. This sets out that a collecting society applying to use ECL will need to provide details of its proposed scheme. Any authorisation could then cover only the specific uses set out in the application.
Amendments 28X and 56 would require the Secretary of State to extend the right to opt out to an exclusive licensee or authorised representative. The rationale for this is understood, but further work is needed to explore how it would work in practice. This will be explored with stakeholders in the working group on ECL and orphan works. While this issue will be considered further, the Bill does not rule out such provision as it stands.
Amendment 28Y would require any collecting society operating an ECL scheme to adopt a code of practice which met certain criteria. The principle of the amendment is appreciated and government policy is for all collecting societies to adopt codes of practice that comply with minimum standards, which were published in October 2012.
Lord Clement-Jones
Very briefly, because the hour is late, I echo what the noble Lord, Lord Greenway, said. It is unsatisfactory to be discussing a cornerstone of the Bill at the fag end of the Committee, when we know that the Committee normally finishes at 7.45 pm.
There were many useful nuggets in what the Minister had to say. Some of the detail he gave was very useful, but I was particularly interested in his affirmation that ECL was not useable for rights outside the United Kingdom. The noble Lord, Lord Howarth, seemed to think that it had that flexibility, but it does not. That is what makes it an unsatisfactory arrangement and why many people object to it. It is setting up a separate UK situation which eventually, I hope, will be overtaken by an EU directive on ECL, so in many ways ECL is premature.
However, it is far too late to talk at length about the principles of ECL. My amendments tried to improve the scheme. The Minister has elucidated quite a lot. I will read Hansard with great interest. In the mean time, I beg leave to withdraw the amendment.
Lord Popat
My Lords, this may be a convenient moment for the Committee to adjourn.