DRAFT INTELLECTUAL PROPERTY (AMENDMENT ETC.) (EU EXIT) REGULATIONS 2020
(Limited Text - Ministerial Extracts only)
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The Chair
Order. Before we begin, I remind Members that social distancing should be observed at all times. Hand sanitiser has been provided. It is obvious that some colleagues present have not served on a Delegated Legislation Committee before; the Government and Opposition Whips are available to explain to Members, if they have any queries, how to proceed.
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Amanda Solloway)
I beg to move,
That the Committee has considered the draft Intellectual Property (Amendment etc.) (EU Exit) Regulations 2020.
It is a great pleasure to serve under your chairmanship, Sir David, and it is a pleasure to speak in my first Delegated Legislation Committee as a Minister, particularly on such an important area as intellectual property. Intellectual property forms a vital part of the UK economy. A well-balanced IP system supports our citizens in their creativity and ingenuity, providing incentives for our businesses to innovate through research and development. We have seen the importance of innovation and creativity throughout the pandemic: the repurposing of old treatments to combat the virus, new technologies supporting social distancing, and theatre companies bringing performances into our homes.
IP enables society to benefit from sharing knowledge and ideas while rewarding creators. Innovation will be crucial in the years ahead to support our recovery from the impacts of covid-19, and the UK is already a global leader. Just last week, the World Intellectual Property Organisation ranked the UK as the fourth most innovative country in the world, and the Government are committed to ensuring that we maintain that position.
So why are the regulations needed? As the Committee knows, the European Union (Withdrawal) Act 2018 brings across EU law that applies to the UK at the end of the transition period, making it into domestic law. To safeguard against the possibility of leaving the EU without an agreement, six statutory instruments were approved last year, covering various IP rights. They ensure that EU law on IP will work correctly when brought across. Of course, the withdrawal agreement meant that the UK left the EU on 31 January 2020 in an orderly way. At the end of the transition period, we will have control of our laws and will operate once again as a sovereign, independent nation. However, it is still important that we do so with a statute book that functions effectively.
This SI, which was laid before Parliament on 13 July, therefore has three objectives. First, it updates last year’s SIs on IP so that they will work correctly at the end of the transition period. There will be changes to previous references to “exit day”. Updating also allows us to fix some small errors that were found when revisiting the text of those SIs.
Secondly, as EU law continues to apply to the UK during the transition period, the SI deals with the new EU law that has been introduced since last year’s SIs were made. It fixes inoperabilities that will arise when the law is brought over into UK law in December.
Thirdly, the SI ensures that we fulfil our obligations under the withdrawal agreement. The agreement commits the UK to preserving IP rights that had effect by virtue of our EU membership. Of course, that is what last year’s SIs were already doing, but there are some practical differences that must be reflected.
On trademarks and designs, last year’s legislation ensured that an equivalent UK right would be created for any EU right that is in force on exit day. Since EU rights continue to apply in the UK during the transition period, the SI moves the date of that process to 31 December. That will safeguard as many as 200,000 additional IP rights that will have been granted by that time. Where the validity of the EU right is being challenged and a decision is still pending at the end of the transition period, the withdrawal agreement requires us to apply that decision to the equivalent UK right once it has been made. The SI sets out how the process will work. It means that third parties will not require the expense of separate action to get rid of the equivalent UK right. The changes ensure that holders of such rights have certainty that their rights will be properly protected in the UK.
Another important area of IP law is supplementary protection certificates—SPCs—which provide additional protections for patented medicines and pesticides. This reflects that those must be approved by a regulator before they can be sold, which can take many years. SPCs help protect our most innovative drugs. For example, the asthma medicine Nucala has been protected for a maximum period of five years. Developed by GlaxoSmithKline, it has had world sales of more than £200 million in the last quarter. SPCs balance supporting innovation and developing new drugs with the need for patients to have access to drugs cheaply through competition from generic manufacturers.
The UK’s SP system derives from EU law. Last year’s legislation ensured that the system would function in the same way before and after exit day, giving certainty for both right holders and the wider interests. Since then, the EU law on SPCs has taken effect, introducing what is generally referred to as the manufacturing waiver. This allows third parties to make SPC-protected medicines in certain specific circumstances while the SPC is in force, without requiring the permission of the SPC holder. We consulted stakeholders on how the waiver should work in the UK. They were clear that we should keep the circumstances in which it can be used the same. That is the approach we have taken in this instrument to ensure we maintain the fine balance of this complex area of IP law.
Finally, the SI also deals with copyright and database rights, as well as the principle of exhaustion of rights. The changes in those areas are all concerned with simply updating last year’s legislation to reflect the end of the transition period. This instrument will ensure that the UK’s IP system has a firm footing when the transition period comes to an end, giving our innovative and creative citizens and businesses the certainty they need in this important area. I commend the regulations to the Committee.
Amanda Solloway
I thank the hon. Member for Newcastle upon Tyne Central for her comments and acknowledge her great passion for science and this particular field. I thank the Committee for its consideration of the draft regulations and hon. Members for their valuable contributions.
In response to the specific questions that have been asked, of course we are interested in protecting UK rights here and abroad. This and other legislation ensures that we do that by, for example, creating comparable rights in the UK for trademark and design holders.
One of the questions was about consultation. The Government have taken on board the concerns raised by UK attorneys about their loss of rights and representation at EUIPO. The IPO has recently finished an online call for views on this issue, which received more than 1,000 responses. We are considering whether to reciprocate by requiring a UK-only correspondence. The IPO has been planning for some time for the end of the transition period. It is the most robust place to cope with the additional IP rights that will come across from the EU. No EU rights have yet been transferred; they will come across at the end of the transition period.
Intellectual property matters. The IP system exists to encourage innovation and the sharing of information, and gives confidence to invest time, money and energy in developing something new—a business, a new book or a new piece of technology. The UK IP system is consistently rated as one of the best in the world, and I agree with the hon. Lady about wanting to make the UK the most innovative country in the world—I thank her for that.
Earlier in the summer, the Government set out our long-term objective for research and development through the new R&D roadmap, which I believe is a strong foundation for the way forward. We are committed to strengthening science, research and innovation further across the UK and making them central to tackling the major challenges that we face, including disabilities such as blindness. Intellectual property has an important role to play in supporting those objectives.
The IPO will continue to deliver high-quality rights, grant services, lead best practice for the enforcement of IP rights and retain its central involvement in international discussions on the development of the global IP system. Alongside the roadmap and the IPO’s work, these draft regulations will play their part in helping to ensure that our IP system is in a good place to support the Government’s goals and innovation so that the UK is best placed to develop and grow innovative businesses. I hope the Committee will support the regulations.
Question put and agreed to.