Lord Stevenson of Balmacara
Main Page: Lord Stevenson of Balmacara (Labour - Life peer)Enterprise and Regulatory Reform Bill
Lord Stevenson of Balmacara Excerpts(11 years, 9 months ago)
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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.
“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.
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.
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.
“( ) 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?
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 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.
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.
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 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 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.