Copyright and Rights in Performances (Certain Permitted Uses of Orphan Works) Regulations 2014

Lord Stevenson of Balmacara Excerpts

Thursday 23rd October 2014 Grand Committee

[Viscount Bridgeman (Con)]

My Lords, I declare an interest as a non-executive director of the Bridgeman Art Library, where the use of orphan works is a not inconsiderable part of its business.

The library has in fact benefited from, shall we say, the slightly relaxed attitude that has been so eloquently referred to by my noble friend Lord Clement-Jones and the noble and learned Lord, Lord Scott. My noble friend mentioned Canada and Hungary, where admittedly a very low number of licences are issued, but proper, diligent verification schemes are in progress there. We look to the Minister for reassurance.

[Lord Stevenson of Balmacara (Lab)]

My Lords, I thank the Minister for introducing the orders and noble Lords for their contributions to this debate. It is a bit of a reunion. I have been missing our regular fixes of IP craft and lore—and the pain that goes with having to read up on all this stuff again and trying to remember where we were the last time we were here. I hope there will be other opportunities, perhaps not in the immediate future, where we might get together. Maybe we should form a dining club or something and we could all go off and talk about it.

Like other noble Lords, I had some difficulty in disentangling the two orders. They point in slightly different directions, they do not take the same approach and the regulatory frameworks are rather different. But it seems a bit of a missed opportunity not to have had a single order, for the benefits of rights holders at least, which dealt with what the rules were and how they varied according to the domestic or the EU side. I can understand the logic for what the Government have done but it would have been possible, I think, to have had a go at that and come up with something that would have been easier to do.

Other points have already been raised in the debate, which I was going to touch on. However, again, we make a mistake if we try to think of this initiative, which was of course foreshadowed in earlier primary legislation, in the absence of considering how it impacts on the Copyright Hub. We all wish that well and think that it will be a huge step forward as regards the operation of the creative industries in this country—which must inevitably be dealing with exactly the same material as we are talking about here. If there is to be an effective Copyright Hub, it must also go to the 91 million pieces of information held in an orphan state.

Isn’t “orphan” a wonderful word? It makes you feel all warm and cuddly. You want to embrace these statutes and take them forward, because orphans must be helped. On the other hand, the reality is somewhat different.

I will make only a couple of points on the certain permitted uses of orphan works regulations, one of which is about the money. Like my noble friend Lord Howarth, I am not exactly clear what is happening as regards the fund that has to be created—if it has to be created—on behalf of revenant right holders when the relevant body operates to bring forward material that has previously been orphaned. It would be helpful if the Minister could respond to that so that we have a clear arrangement.

Given the amounts concerned—the quotations for examples that have been given already—they are so low that it is not reasonable to expect these bodies, many of whom are strapped for cash, to hold an escrow of moneys that could have been used to maintain and do this activity, particularly when it is likely that the payments out would be reasonably small and/or insurance could be obtained for it. A fair compensation is presumably trivial relative to the overall running costs of many of the institutions—certainly to the ones that I have been familiar with—and I would have thought that there is some room for flexibility. Perhaps that can be noted and picked up when we see the annual report or the first report on this.

My second point is that again, like a number of previous speakers, I am not sure what the logic of having a time-limited area is. If it is true that we are talking about material that is very unlikely to have revenant rights holders, and that an initial licensing period—which is certainly what we discussed when we talked about the primary legislation—is the appropriate thing to do, just in case it flushes out those things, then second and subsequent licences could easily be indefinite, particularly if there is a provision. I understand that the order says that if the right holder presents themselves and is clearly the owner of the work, the licence can be stopped immediately. I do not get the point of having excessive, burdensome bureaucracy over what would be a very small number of licences anyway at very low cost, which would cause both the institution and probably the IPO considerable additional work.

Other points apply to varying parts of both the regulations, and some of them are quite detailed, so I do not expect the Minister to respond to them all today; I look forward to one of her wonderful letters. First, there is the position of the revenant right holder. Is this person sufficiently considered by the scheme, and if so, is the treatment fair as a whole? The Government’s rather brave assumptions are that there will not be many revenants. I looked that up on Google and it turns out that it is a word for zombie—so there will not be many zombies. “Revenant” is probably a more technical term. Those that reappear, according to the Government, will be happy that their works have been uncovered, subjected to diligent search and licensed, and that the terms of the licences already granted—which cannot be varied—are fair. We do not know whether those assumptions are correct. However, I worry that a right holder who would have refused to grant a licence had he or she been located is unlikely to be pleased with the outcome, as the material is licensed and goes on the register as an orphan work, possibly with a licence that might be set to run for as long as seven years.

Stakeholders representing various right holders have already pointed out that the flow charts which the IPO had prepared made no reference to the possibility of a right owner who had not been identified by the applicant as part of the diligent search process coming forward once the application appeared on the register. The stakeholders suggested that it would be sensible to have a pause in the process once the application had appeared on the register, just for a short time before the licence was granted, to avoid the licence coming into force and the right holder shortly thereafter discovering that his or her work was being licensed.

The IPO has partially taken this concern on board but only to the extent that the flow chart now identifies the possibility of a right holder coming forward when the application is placed on the register, but before the licence has been granted. If that were to happen, the licence would not be granted under the terms of the scheme at all. It would be up to the right holder to determine whether a licence should be granted. However, the IPO has not been willing to allow for any specific period to elapse before a registered licence came into force. That is worth considering.

--- Later in debate ---

[Baroness Neville-Rolfe]

My Lords, I thank noble Lords for their valuable contributions and comments. We always have lively debates on these intellectual property issues, partly because of the balance that one has to try to strike on the whole series of measures we have taken.

The noble Lord, Lord Howarth, welcomed the EU directive, as did I, and I in turn welcome the work he has done with the British Library. He is of course the noble Lord, Lord Howarth of Newport, which is where the Intellectual Property Office is located, so he is a friend for that reason as well. It was also good to hear of the interests of my noble friend Lord Bridgeman, who introduced a family perspective into this debate to complement and assist the perspective of national collections such as the British Library.

The noble Lord, Lord Howarth, argued that the scheme did not meet the needs of museums and that the balance was wrong. Clearly, I respect his view, but I disagree. We must protect copyright owners as well as the cultural sector, which was a point made by the noble and learned Lord, Lord Scott.

The noble Lord, Lord Howarth, also felt that the UK scheme was bureaucratic and expensive. As he said, I care a lot about regulation and bureaucracy and will be keeping a beady eye on this. As we have heard, there are views on both sides. As my noble friend Lady Buscombe said, we are slightly between a rock and a hard place. We have to find a balance and move forward on these important intellectual property issues. There were many years of debate when little was done, and it is good that we have moved forward in recent times. We now have a policy on orphan works coming into effect.

We are mindful of the need to make the scheme affordable to cultural institutions. We have developed the orphan works licensing scheme, including the approach to pricing, in consultation with museums, libraries and archives. However, the needs of potential users of orphan works need to be balanced with the rights of copyright holders.

The noble Lord, Lord Howarth, also argued that the diligent search requirements were onerous. I will come on to talk about those in a little more detail in view of the other points that were raised, but I say at this point that it is a fundamental principle of diligent search that it needs to be a diligent search for all relevant rights holders of any given work. That is only fair. Of course, many libraries, museums and archives are already doing this. The difference will be that when those searches do not result in rights holders being found, the search will not have been wasted.

Of course, the EU directive covered only the heritage and cultural orphan works, not commercial works. The UK scheme also covers a broader field than the original EU directive. Despite our efforts to make the directive wider during its negotiations, it does not allow us to regulate commercial use. That also partly answers the question of the noble Lord, Lord Stevenson, about why we had to have two statutory instruments, one under Section 2(2) and the other under domestic legislation, but we are of course debating them together.

The noble Lord, Lord Howarth, asked about licence fees. He said that if you multiply a minimal fee by millions of works, you get large sums.

[Lord Stevenson of Balmacara]

To go back to diligent search, if I am picking this up correctly from what the noble Baroness has said, the irony will be that the position in the order reflecting the incorporation of the EU measure has got specified minimum requirements for a diligent search, but there are no such requirements in respect of the commercial work. That is, I think, the cause of the unease that we all feel. Does she not recognise that unless a similar or even greater level of scrutiny is required, the danger will always be in the minds of the rights holders that they are not being dealt with fairly in the domestic issues?

[Baroness Neville-Rolfe]

I thank the noble Lord for his intervention. I think in fact that is not right. There will be rules for diligent search and indeed we have published guidelines on diligent search, which I am very happy to make available to the Committee. For exactly this reason, we are very aware of the interplay between the two schemes and that is something that we have been concentrating on during the extensive period of implementation and thinking about exactly how to implement this.

I would say that licence fees are not a tax. They are the price owed to the copyright holder. It is fair to pay for this, given that copyright is, in a sense, a property right, as has been said.