Intellectual Property (Exhaustion of Rights) (EU Exit) Regulations 2018

Lord Adonis Excerpts

Wednesday 6th February 2019 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

My Lords, I am happy to follow the noble Lord. He has made some detailed comments and posed some questions which I hope the Minister will be able to respond to. Having said that, I accept that the Minister’s letter of 21 January—running to eight pages and covering a lot of detail—as well as subsequent meetings have done a lot to clarify some of the issues that were before us when this was first considered in Committee. But good scrutiny leads to further debate and discussion, so it is not inappropriate that we should come back and point out areas that are not as good as perhaps they should be as we pass this important, time-limited piece of legislation. I also agree that the clarification about the Silhouette case, which was a confusing passage of discussion in Committee, has made things much clearer and will be helpful to those involved in that issue.

The Government should take away from this process three main things. First, if there is an SI of the sort of significance represented by the three intellectual property regulations before us today, the fact that consultation need not be carried out is not sufficient to assuage the concerns of those who have had to respond, even as late as yesterday, to these issues. There is a lesson to be learned here about the need for more engagement and a more considered approach to the context of these amendments. I accept the pressure of time and the difficulty of fitting everything in, but the consequence of not consulting according to the style and process that people have become accustomed to, just because this is a special case, has meant that we have not had the best advice that would have been available to us in ordinary circumstances.

Related to that, the question of whether one needs an impact assessment is also important. There is of course a de minimis figure, which was in the Cabinet Office rules. But when one thinks about the impact that these new regulations will have, even for a time-limited period, the Government should be prepared at the very least to bring forward for consideration evidence that the de minimis figure has been met. At the moment, all we get is an assertion; we are left to guess whether the figures that might be construed will work. That is not satisfactory in terms of general process.

Thirdly—this does not apply to the SI before us at the moment but applies to the other two—considerable variations in approach have been taken by the different departments on the EU exit SIs. There should be some overall consideration of this when the time comes to review how, in some areas, the limited licence available to ensure that the statute book is in good order as we leave the EU, if we do, on a no-deal basis, has been interpreted differently in different departments. We heard even today that the Treasury has a completely different approach from that of others on the issues of consultation and preparation of estimates that I have been talking about. The public interest would be better served by a slightly different approach.

[Lord Adonis (Lab)]

My Lords, first, I thank the Minister for his extensive letter to noble Lords responding to the debate in Grand Committee. I have a specific question and will then make some comments on the wider issue of consultation which has bedevilled all our proceedings on these no-deal statutory instruments, because the consultation has been so haphazard and unsatisfactory. My question is in response to the Minister’s opening remarks, when he said that it was “not sensible” to put a sunset clause on the current exhaustion regime. That is a judgment which the Government have made but, since this is clearly a matter of extreme importance to the industry, can he tell us what the view was of stakeholders who were consulted on the issue of the sunset clause? I understand that that issue has bedevilled these proceedings throughout.

On consultation, the Minister’s letter was significant; it accepted that the consultation which had taken place had been in confidence. Having secret consultations which are not open to all relevant people, or all those who wish to take part, particularly from the industries consulted, is contrary to almost all of the principles of public consultation. The Minister’s letter has an extremely convoluted paragraph about how this secret consultation was conducted. It says that the Intellectual Property Office, or IPO,

“identified the relevant representative organisations or businesses it would usually engage with, and who would give a range of views. Because of the confidential nature of the review”—

which was entirely self-imposed by the Government; this did not need to be confidential but could have been an open, public review—

“the IPO then identified and invited 12 individual experts who had previously liaised with the IPO in a role within one (or more) of those relevant organisations”.

The letter then lists the organisations. It continues:

“I believe this is consistent with what I said in my … clarifying remarks about this process during my closing speech; the IPO’s understanding was that these individuals were ‘from’ those organisations but they were, as I clearly said, ‘a group of individual stakeholders’ and the IPO ‘consulted them in their personal capacity’. I therefore also agree with Lord Warner that the organisations themselves were not consulted in the way that would usually happen”.


Reading that twice, one realises the truly extraordinary nature of the consultation which has taken place. The Government have arbitrarily and secretly selected 12 individuals because—to cut to the chase—officials happened to know them and had dealt with them previously. They then chose to consult them, telling Parliament that the consultation process was adequate. However, when pressed, it is clear that these people do not in any respect represent the organisations from which they have come. We are not told who the individuals are and they are not in any way accountable for their advice. We are told that the advice was given individually, but we are not told what it was. When it comes to disputes on major aspects of policy embedded in these regulations, the Government blandly assure us that the decisions they have taken are sensible. In my experience, Governments always think that their decisions are sensible; I have not yet met a Treasury Minister who said that their decisions were not sensible. However, the Government will not even tell us whether the “sensible” decisions they have made reflect the secret consultation that took place before the preparation of the statutory instruments.

Because of the unsatisfactory nature of this whole procedure, we will have to approve this regulation. However, in any normal circumstances, we would not approve a regulation on the basis of a secret consultation with 12 individuals—selected secretly by the Government, whose names we do not know and who are not in any way accountable—when there should be a public consultation. I raise this point not only to highlight the unsatisfactory nature of this, which goes to the heart of all this no-deal planning, but because of the cascade of regulations still to come. Every time your Lordships meet, a plethora of regulations appears before us. In the health Bill, which we debated yesterday —I did not participate, but I read the Bill during the proceedings—there was provision for a whole slew of further regulations, with procedures as yet undecided.

I invite the Minister to respond on this, as I think it is important to get this on the record. Can he give some undertakings that consultation on future regulations laid before your Lordships will be done in an open, transparent way, so that we are not faced again with consultations with secretly selected individuals? As noble Lords will recall, when we were debating one of the instruments, we were told that the individuals were “selected and trusted” respondents—presumably on the grounds that a general public consultation with people who were willing to share their views would not engender trust.

This is not good government. In any circumstances other than this national emergency, I am confident that your Lordships would not agree to process, let alone consent to, regulations on this basis. We need some assurance that, in the time remaining, consultations will be conducted in a proper manner, rather than in the secret, cloak and dagger, totally unaccountable fashion that we have seen in respect to this instrument.

[Lord Warner (CB)]

I want to follow up that point. I remind the Minister that after our rigorous series of exchanges in Grand Committee on these regulations, I took the liberty of submitting a Written Question, which was answered extremely helpfully on behalf of the Cabinet Office by the noble Lord, Lord Young of Cookham. I wanted to check that my memory was correct about the Cabinet Office rules on consultation. Not only do they require 12 weeks—during which people can comment in what is often a helpful way for the Government of the day—but the twin leg to this is that the Government have to publish those responses to their consultation. Not only have the Government, as the noble Lord, Lord Adonis, said, cut out the middleman in their approach to consultation, but by doing it that way they have avoided the commitment to publish the responses to that consultation. So there is a twin problem with the Government’s approach to many of these SIs. I suspect it is going to continue in relation to the Healthcare (International Arrangements) Bill, which contains Henry VIII powers for the Government to produce a lot of SIs. If the Government go on behaving on these SIs in the way that they have behaved on those we are discussing today, they will drive a coach and horses through their own Cabinet Office rules on the way we go in for consultation on legislation.

--- Later in debate ---

[Lord Henley]

My Lords, some of us still read books, and some of us still read letters. I shall not follow up the Scottish exchanges that have just taken place; I shall start with the letter referred to by the noble Lord, Lord Stevenson—the letter that I sent, I think, on 21 January. The noble Lord, Lord Adonis, described it as “extensive”; the noble Lord, Lord Stevenson, said that it was eight pages long. What I have in front of me is six and a half pages long, so I just want to be clear that we are all talking about the same letter. I see that the noble Lord, Lord Adonis, and I are going to count.

[Lord Adonis]

I read it on my iPhone, so I have no idea how long it was.

[Lord Henley]

I think that deals with the point about modern technology—but I deal in letters, and mine is six and half pages of A4. I hope we are all talking about the same letter, which I sent on 21 January. I think, and hope, that it dealt with a great many of the points that have been raised.

I shall go through some of the points that came up in the debate. The principal one referred to by the noble Lords, Lord Adonis, Lord Stevenson and Lord Foulkes, is that there has been a failure of consultation—it just has not been good enough. I believe it has been consistent with the approach taken on no-deal legislation across government. The Government’s consultation principles are clear. Consultations should have a purpose. The statutory instruments in question make only those corrections to retained EU law that are necessary to give the UK a functioning statute book in what we have all made clear is the unlikely event of a no-deal exit, and maintain as far as possible the existing domestic position. A consultation on policy change would not have been meaningful as that is not what these instruments do. Again, I set that out in my letter.

I make it clear that there will be full and proper consultation on further changes. All those who have had dealings with the Intellectual Property Office will accept that it has a good record in this respect. It consults properly and will take into account the concerns of all those who have an interest. I give an assurance that the IPO will do that: it will consult and make sure—