Intellectual Property Bill [HL]

Lord Borrie Excerpts

Tuesday 11th June 2013 Grand Committee

[Viscount Younger of Leckie]

I thank the noble Lord for that quite technical question. It is true that there is a clear discrepancy between three and 15 years. I think that it would be best if I write to the noble Lord and copy in other noble Lords with a substantive answer to clarify precisely how these time periods were arrived at and to give some background information on how they came about. I think that that is the best way forward.

[Lord Borrie]

Perhaps I may pursue this a little further. At Second Reading, I raised the point that in terms of intellectual property the grant of copyright or the grant of registered or unregistered design can result in a big improvement in competition. It encourages creativeness and innovation and it encourages the emergence of new competition. On the other hand, competition generally—meaning competition of new and old, old and new—surely means, to re-emphasise the point made by my noble friend Lord Howarth, that if because of the 15 years or any other substantial period general competition is confined and there is no competition for a particular design or copyright area, then the period is too long. In all the studies that have been made, including Hargreaves and so on, I wonder whether the rather vital matter of whether it should be 15 or 10 years or whether it should be so many months has been considered and reconsidered afresh in order to see how applicable these periods of time are for the future.

[Lord Brooke of Sutton Mandeville]

My Lords, in pursuance to what my noble friend said immediately before the noble Lord, Lord Borrie, intervened, would it be possible, in the interests of completeness, if all those who are currently present in Grand Committee were to get a copy of the letter that my noble friend sends to the noble Lord, Lord Howarth?

--- Later in debate ---

[Lord Clement-Jones]

My Lords, it may seem somewhat of an anticlimax to come to these two amendments after visions of tsars and Alexander Nevsky crossing the ice, and so on. However, Amendment 15 is rather elegant, and I support it in principle. My friends at the Law Society would certainly find it an elegant solution. They say, under Clause 9(1), that the assignment of an unregistered right—very much as the noble Lord, Lord Stevenson, put it—

“need not follow the corresponding registered right (as is currently the case). The Bill should clarify whether the unregistered right is assigned to the same party, at registration of the assignment of the registered right. This will mean that under the new regime businesses can check whether an unregistered right has also been assigned to the same owner as the registered right, or whether they need to be aware of an unregistered right lying elsewhere”.

Amendment 15 achieves that aim. It is an extremely useful instrument, which would mean that there would be no doubt in future as to where the respective rights lie. It would be a source of some confusion if that was not known. This is a very interesting solution to something that will otherwise cause problems in future.

[Lord Borrie]

It seems slightly strange, to put this to my noble friend, that legislation which may have been in existence for many years specifies a particular form and what it should contain. That does not seem very appropriate.

[Viscount Younger of Leckie]

My Lords, Amendments 14 and 15 relate to the role of the registrar. I will first address Amendment 14, which would remove a power granted to the Secretary of State to specify circumstances where a document could not be inspected online, and the discretion in considering such cases.

Clause 9 is designed to allow users to access information on registered designs electronically whenever they want to—an idea fully supported by businesses in the recent consultation. There may indeed be circumstances in which publication of documents could cause harm, and it is in the interests of applicants to apply an exception in such cases. An example might be where material is commercially sensitive or otherwise confidential. Such exceptions are best made explicit in rules because they can be changed more easily and quickly to reflect the needs of business. The report of the Delegated Powers and Regulatory Reform Committee made no recommendations for changes in relation to the clause.

The power to make such changes will be limited to the circumstances that arise in this clause—for example, if the registrar’s opinion disparages any person in a way that is likely to cause harm or if material were considered immoral or likely to cause offence. This power will be subject to the general requirements of administrative law, and the scope of any rules relating to the registrar’s capacity to withhold electronic publication of documents will be subject to consultation.

I turn now to Amendment 15, which introduces a specific modification to an official form. It allows the registrar to give directions specifying that the form shall include a statement indicating whether or not any associated unregistered design right has been assigned to the same assignee. The Government recognise that this requirement might encourage businesses involved in such assignments to consider ownership of all the potential rights associated with their design, and it may help third parties to more readily track any changes in unregistered designs.

However, Amendment 15 places an additional burden on those seeking to register an assignment by requiring them to go through additional checks on the status of the unregistered design, to establish whether the unregistered right still exists or has expired, and whether it has previously been assigned to a different party. It could, in fact, delay updating the register if those details needed to be checked. Part of the rationale for removing Section 19(3A) was for records to be kept up to date more easily. It does not seem appropriate to require additional information to be supplied instead.

I hope that noble Lords agree that the sobriquet “Ivan the Terrible” does not entirely fit my character. The Intellectual Property Office is always seeking to provide the best service it can to its customers, which includes the amendment and deletion of official forms where these are proposed to the office. This is why Clause 12 on the use of directions removes the requirement to use secondary legislation in relation to forms and instead enables the use of directions, thereby mirroring existing powers relating to similar procedural matters for both patents and trade marks. To refer in the Act to a form in the manner described would undermine the purpose of Clause 12 and the wishes of stakeholders.

However, the noble Lord, Lord Stevenson, raised the issue of the huge majority of rights that are unregistered, which is a fair point. Perhaps there needs to be a better register with greater information included. We welcome these comments. We believe that as far as possible the register should provide more information. As the noble Lord knows, there is a balance to be struck between this and not placing too much burden on business.

In the context of these comments, I hope that the noble Lord feels able to withdraw his amendment.

--- Later in debate ---

[Lord Borrie]

My Lords, I very much support my noble friend Lord Young. This idea is that having had an opinion service available for some time in relation to patterns, that is now to be brought over to the subject of designs as well. It seems a most useful device, enabling people to get an opinion for what I believe to be a relatively low cost to the applicant. Having that instead of taking legal proceedings or, at any rate, allowing a certain delay until legal proceedings are brought seems most helpful. However, it does not seem to be appropriate when, as the clause specifies, this is not a decision. My noble friend read out the bits of the clause which are relevant to this. It is an opinion; the clause specifies that. It is authoritative because it is coming from a source that ought to know the answer but, by not being a decision, surely it is inappropriate that there should be an appeal. It somehow takes away from the great value of an opinion, which is to give something straightforward in the opinion of the people who ought to know. Having it without an appeal would enable it to be done quite quickly.

[Viscount Younger of Leckie]

My Lords, Amendment 17 would remove the right of appeal to an appointed person in respect of opinions given under the design opinions service. The Government believe that the right of appeal is extremely important. In this case, businesses who receive a design opinion from the registrar should have the right to appeal that decision to an appointed person. This ensures that a person who is aggrieved by an opinion is able to get a second view on whether the opinion was arrived at correctly in the first place. In particular, it is an important next step before parties consider formal legal proceedings, which could be time-consuming and costly.

Offering a route of appeal for the design service reflects the principles established in the existing patent opinions service. The patent service has been well used, as has the ability for the opinion to be subject to a review procedure. Furthermore, a right of appeal was considered particularly important in the light of the European Convention on Human Rights: an adverse opinion could affect the value of the right and hence the proprietor’s ability to make use of it in business. It is therefore important to offer an appeal for design opinions to ensure that the necessary safeguards are in place.

Noble Lords commented that the routes of appeal against a decision by the Intellectual Property Office include an additional route of appeal to the High Court. This is because decisions by the IPO can be legally binding and can have an impact on a party’s rights. In contrast, the opinion provided by the opinion service is non-binding—indeed, it is an opinion, as the noble Lord, Lord Borrie, pointed out. That is why in subsection (6) of Clause 11, the proposed new section sets out that:

“An opinion given by the registrar under the regulations is not to be treated as a decision of the registrar for the purposes of section 27A.”

The opinions service is designed to be low cost and non-binding. The route of appeal available—an important principle to uphold, given the underlying economic value of the property right—is also low cost and appropriate to the non-binding nature of the opinion offered to parties. The noble Lord, Lord Borrie, raised an issue of cost. I can reassure the noble Lord that the cost of the service will be subject to compensation. In the mean time, I ask that the noble Lord, Lord Young, withdraws this amendment.