Lord Stevenson of Balmacara
Main Page: Lord Stevenson of Balmacara (Labour - Life peer)Intellectual Property Bill [HL]
Lord Stevenson of Balmacara Excerpts
Lord Clement-Jones
My Lords, in moving Amendment 23, I shall speak also to Amendment 24. Amendment 23 is very straightforward. Really, it is a question for the Minister: as regards the new criminal penalties that apply to registered design rights, why has Section 110 of the Copyright, Designs and Patents Act, “Offence by body corporate: liability of officers”, which ensures that company officers are liable if conniving or consenting, not been replicated here for registered designs? I could read out the relevant offence under the CDPA but I am sure my noble friend is familiar with it. However, it seems odd that everything else replicates what is contained in the CDPA for copyright but not the application concerning the liability of company officers. Considering that so much business is conducted through companies, it seems extraordinary that that provision is not included in the Bill.
I see that there will now be a clause stand part debate. I am not surprised because this is clearly a subject that needs airing. Rather more controversially, Amendment 24 is an attempt to advocate the extension of criminal offences for infringement of unregistered designs. As we know, Clause 13 introduces a new criminal offence of deliberate infringement of a registered design right. While this is a welcome move, to be of any benefit to the vast majority of designers in this country, the Bill needs amending so that criminal sanctions also apply to the deliberate infringement of unregistered designs.
Design is of key importance to the UK economy. There are around 350,000 designers in the UK and UK businesses spend around £35.5 billion on design each year. The majority of the UK’s design community are lone, micro and SMEs, with 87% having fewer than 10 employees and 60% having fewer than four. Approximately 4,000 designs are registered annually in the UK and approximately 5,000 are registered in the EU. However, the great majority of designers rely on unregistered rights.
Each year, between 18,000 and 25,000 unregistered designs are lodged with ACID—which represents designers and was mentioned at Second Reading and in these proceedings—by its some 1,100 members. ACID’s design data bank does not add to any intellectual property rights but provides evidence of the date on which it received a design. It encourages designers to keep an IP audit trail from the seed of an idea to market reality, which provides essential evidence if designs are copied. Extrapolating from that figure of 1,100, it is therefore reasonable to assume that the majority of the UK’s designers rely on unregistered design rights, and on copyright of course.
Why, then, is the new criminal offence limited to infringement of only registered designs? Surely criminal sanctions need to apply to unregistered design rights as they apply to copyright, in order to have any real and lasting benefit for UK designers. The introduction of criminal sanctions for deliberate infringement of registered designs is a progressive step. This is the first time that criminal sanctions have mirrored copyright. While I accept that registration offers designers a longer-term and stronger right, unlike trade marks and patents, there is no extensive examination for registration, so design registration is a very different type of protection.
To register a design costs £60 per design. Regrettably for most lone and micro designers, the cost of registering every iteration of a design would be prohibitive. ACID receives between 18,000 and 25,000 designs annually, so it is clear that informed designers take their design audit trail seriously. However, to ask them to pay £60 would be a real barrier. The majority of ACID settlements have been based on unregistered design rights and the ability to provide a design audit trail held on the ACID design data bank. In its 2010 survey, 89.7% believed that design infringement was deliberate and blatant. In a further survey in 2012, 97% believed design infringement was deliberate and blatant. Given the cost, time and scale of opponents in the majority of these cases, deterrence against copying is critical. Extension of criminal sanctions to unregistered design rights for the majority of the UK designers would be a deterrent to persistent copying in much the same way as it is for copyright and trade mark infringement.
Criminal sanctions have been available for copyright infringement since 1862 and for trade mark infringement since 1994. Criminal prosecutions have been used sparingly, sensibly and appropriately. Copyright is a property right. A trade mark and an unregistered design right are property rights, as is registered design. Whereas persistent copying of the first two constitutes a serious criminal offence, punishable by up to 10 years’ imprisonment, which exceeds the longest sentence for ordinary theft, currently persistently copying designs is not a criminal offence at all. This is completely anomalous. Persistently copying a 2D drawing of a design or a design document can give rise to criminal liability under Section 107 of the CDPA, but when this 2D work is converted into a 3D design, unless it is protected as a work of artistic craftsmanship, which we have previously discussed, copying that 3D version would not be a criminal offence.
I fail to understand the policy decision behind this. Nearly all designs are copied from the 3D original, not the 2D drawing. How do the Government justify giving a higher level of protection to a 2D design brought than they to the 3D manifestation of that design? A telling point was made by designers when they gave an example of the scale of opponent in the three latest cases involving members of ACID. This demonstrates the inequality of arms between infringers and designers. For instance, one ACID member had a turnover of £50,000 and two employees, and its opponent in this infringement case a turnover of £8.7 billion and 78,000 employees. How on earth can a lone designer gain justice in those circumstances?
In a second case, an ACID member with a turnover of £500,000 and 15 employees was opposed by a major retailer with a turnover of £20.5 billion and 145,000 employees. I will not try the Minister’s patience much further—these are difficult cases, where members are seriously prejudiced—but in a third case, an ACID member with a turnover of £250,000 and 10 employees was opposed by, again, a major retailer with £3.4 billion turnover and 52,000 employees.
If anything, in these circumstances, there are quite honestly stronger reasons for imposing criminal offences for unregistered design right infringement than there are for infringing a registered design. I hope that the Minister can elucidate why this is not being done and perhaps give us some assurance that this is under consideration. I beg to move.
Lord Stevenson of Balmacara
My Lords, I am very grateful to the noble Lord, Lord Clement-Jones, for his lucid introduction of these two amendments. As he says, the first seems to deal with an error. We shall wait to see what the Minister says about it, but we would support it if he chose to take it further.
Amendment 24 picks up the debate where we left it on Tuesday. For most of the time we reflected on why the Government have adopted a two-track approach, although unfortunately in this case the tracks lead in opposite directions. In one there is no attempt to simplify the design rights field. The points made by Ian Hargreaves in his report, and picked up by many commentators, seem to have been ignored. I know that it is difficult to eliminate unregistered design rights; nevertheless the fact that we have five different ways of classifying or approaching these designs is still an irritant and source of confusion for the industry. It cannot be effective in terms of building up the creative industries more generally. It is something that will have to be addressed at some point, if it is not dealt with in this Bill.
The second track is this: why should one penalise on the registered design side but not on the unregistered design side? We will be opposing the question that Clause 13 should stand part in the next group, so my position on this is somewhat complex because I would not want to see criminal penalties brought into this area at all. That is not the right direction of travel and I will expand on that when I speak in the clause stand part debate. Parking that for a moment, I accept absolutely the points made by the noble Lord, Lord Clement-Jones. There is no substantive difference in how unregistered and registered designs are treated. The fact that they are registered does not in any sense imply approval or otherwise of them, or give them any status that is different from unregistered ones. The figures are exactly what they are. Most of the people who operate in these fast-moving areas, particularly fashion, tend to use unregistered designs, and those who do so have no real protection when there is a problem.
I was particularly struck by the points made by the noble Lord, Lord Clement-Jones, about the way in which the design copying process might happen. Most people would take the 3D representation of a design, not the 2D design. As he pointed out, the discrepancy in how such malfeasance is then approached by the courts is obviously a stark example of how the process is not working.
The noble Lord’s final point about parity of arms is one that we will return to. It is clear that there is a real danger in the creative industries these days that those with the resources can use the system to obtain advantage in the knowledge that people will not be able to defend their designs. Yet we rely on these individuals and small companies to provide the design initiative that is necessary to grow our creative industries. For all these reasons, I support the noble Lord in his amendments.
Lord Howarth of Newport
My Lords, consistency is not necessarily a virtue and I think that we should be very careful in the field of intellectual property. We legislate not simply out of tidy-mindedness or a desire to achieve a satisfying consistency by transferring rules and regulations that may have applied relatively successfully in one area to another. However, it seems that the noble Lord, Lord Clement-Jones, has made a strong case for consistency in the treatment of registered designs and unregistered designs in terms of the proposed criminal offence. I would be grateful if the Minister could give us his explanation.
Lord Stevenson of Balmacara
My Lords, that was a very interesting debate and prefigured what I am about to say about the question of criminality in this area. The noble Lord, Lord Clement-Jones, has made the arguments and is correct about them, and it is up to the Minister to make the best of if. If the industry is voting with its feet and adopting the unregistered design right as its mode of operation, and if it is true that there is a sense that having criminalisation in this area will improve the quality and quantity of our economic activity in it, it must follow logically that criminal sanctions should apply. However, I shall devote the next few minutes to arguing against exactly that proposition, but then, this is Committee.
Clause 13 introduces a new section into the Registered Designs Act, creating a criminal offence of unauthorised copying of design in course of business. It would apply in respect of UK-registered designs and registered Community designs. As I have said, we are concerned about the fact that this is being introduced as a criminal sanction.
There are two categories of offence, and I shall refer to that as I carry on with my remarks. One is about the making of a product by copying a registered design,
“so as to make a product exactly or substantially to that design”,
and the second offence is dealing in products that have been copied. Both will carry sentences of up to 10 years, which, as the noble Lord, Lord Clement-Jones, mentioned, is very high on the list of tariffs. The arguments for and against criminal sanctions for designs have been extensively aired over recent years, and we should bear in mind that levels of piracy have risen.
To recap briefly, proponents of this move feel that the current civil enforcement is expensive for small innovators and that current civil sanctions are not dissuasive enough for large infringers. Opponents are concerned that unexamined IP rights are a dangerous basis for taking criminal sanctions and that there is a risk of stifling competition in useful products.
We understand the Government’s aim—I have just referred to it—but we worry about whether the proposal for criminal offences in general is the right tool for the job and, in particular, whether it is appropriate and proportionate and would deter those pirates and counterfeiters whose behaviour the public would, I accept, consider to be criminal. There is rather an important discrepancy here. Those who champion criminal sanctions are largely talking about unregistered design rights, which we have been talking about, and, of course, the huge preponderance of design rights are in that category, but the Bill is about only registered design rights and registered Community designs.
Registered design rights are better defined and have a much longer lifetime but, as we discovered, they are not in any sense better examined, so the proposed introduction of criminal sanctions may not work, and I would like to bring some particular problems to the attention of the Committee. The penumbra around a design, which is to be found in the uncertainties about how “exactly or substantially” is defined, makes it unclear what is or is not a criminal act. Unlike parallel trade mark or copyright offences, mere use, whatever that is, of an infringing product, even if no copying is involved, will become a criminal offence. Furthermore, the maximum sentence is very high for what, in fact, could be just a mere business misjudgment without deceptive intent.
The Bill introduces a defence as it states:
“It is also a defence for a person charged with an offence under this section to show that the person did not infringe the right in the design”.
However, the inclusion of the new section contributes to the bizarrely complex nature of the offence. For example, if the prosecution shows that D copies the design, and produces something exactly or substantially to that design, D can attempt to show that the product would not produce, for an informed user, the same overall impression as the registered design. These distinctions are hard for specialist lawyers to comprehend, let alone lay people such as jurors or magistrates. I will return to this point in relation to a recent case. Implied in what I have just said, of course, is the major concern that the courts that will deal with these cases will be criminal courts, which have no real experience at all in design law.
The defence that the registered design was not in fact copied raises difficult questions, as many of the cases on copyright infringements have shown. As already mentioned, there is a concern that the proposed provision could turn into a tool to be used by unscrupulous companies, to the detriment of UK designers. It is reasonably inexpensive to register a design, especially as there is no effective examination, and an unscrupulous company could apply to register designs it copied from a UK designer and then threaten that designer with criminal sanctions for producing his or her own design. The prospect of defending a criminal action might be enough to make the designer give in. What sort of fairness does that speak to?
I have some questions for the Minister on the thinking behind this move. Why does the Bill not state a requirement as to where the act occurs? On the face of it, there seems to be no reason why it should not cover making unauthorised copies elsewhere in the EU, where the acts would infringe an RCD, so the defence that it did not infringe the right in the design would not apply.
Secondly, why does new Section 35ZA define “registered” designs as including “registered Community” designs? Does this not leave open whether the offence might not be committed by copying, or dealing in copies of, a foreign-registered design, for example those with a Benelux registration?
Thirdly, following the implementation of the designs directive, the scope of registered design protection has been broadened. This gives rise to the situation where registered design right is now infringed by use of the same design in different products. Can the Minister confirm that, if a design is registered in relation to one type of product—for example, an image of Bugs Bunny on a mug—that design would be infringed if the person featured it on another product such as a pillowcase? If so, in the latter case, would criminal sanctions be applied?
New Section 35ZA(3) applies to dealers infringing products—both importers and traders. One might wonder how stockists of, for example, Samsung Galaxy phones might have behaved towards what were initially allegations made by Apple in respect of infringement. At that point, if the Bill had been enacted, dealers in those products would have faced criminal liability, and up to 10 years’ imprisonment, if they had made an incorrect judgment call as to whether the Samsung products they were attempting to sell would infringe Apple’s registered design. One can only imagine that this would have done serious—and, as it turned out, unnecessary—harm to Samsung.
New Section 35ZA(3) includes as a criminal act the use of a product in the course of a business and the stocking of the product for use. Does the Minister accept that the word “uses” is an unacceptably vague notion for criminal prosecution? What is the Government’s reason for removing the defence of reasonably believing that the defendant’s design was not an infringement—that the designs were different and would not produce in the informed user the same overall impression? This is often the crux of design infringement cases between competitors. It is worth thinking about what Judge Birss said in the Apple v Samsung case in holding that Samsung products did not infringe Apple’s registered designs:
“This case illustrates the importance of properly taking into account the informed user’s knowledge and experience of the design corpus. When I first saw the Samsung products in this case I was struck by how similar they look to the Apple design when they are resting on a table. They look similar because they both have the same front screen. It stands out. However to the informed user (which at that stage I was not) these screens do not stand out to anything like the same extent”.
If Section 35ZA had been in force, would not Samsung have escaped criminal liability only because it got the judgment call as to infringement—the views of the informed user—right? Had Samsung got that wrong, there would be no defence. Is this what the Government really intend?
Absent either a positive requirement of dishonesty or some sort of broader defence, where a person reasonably believes that they are not infringing, this law could have a significant chilling effect on competition—so much for a Government who trumpet themselves as supporters of competition and opponents of unnecessary regulation.
Lord Clement-Jones
My Lords, I shall be very brief. The beauty of Committee is that entirely opposing propositions can be put forward by the same person. It is only when we get to Report that we have to get serious by being absolutely clear about the propositions being put forward. I therefore do not intend to respond in great detail to the noble Lord, Lord Stevenson, who, I believe, was taking an argument out for a trot. Earlier in Committee, I previously talked about frightening the horses and I am afraid that we are back to horse analogies. It has been an entertaining trot in many respects.
The way that the argument was put together misunderstood what happens in court. It is about the adducing of evidence. It was reassuring that the judge listened to the arguments and evidence and felt as a result that he understood far more about the genesis of the design right. Of course, in a criminal court you add mitigation to all that. It is not worth suddenly locking up people as a result of being prosecuted for design infringement. If you do something reasonable in the eyes of a criminal court in such circumstances, you will be able to mitigate the offence, even though technically you may be guilty of it.
I am afraid that I do not accept the noble Lord’s argument. However, I have wanted to use the expression “a fortiori” for many years in Committee; if you have the ability to prosecute in a criminal court for an infringement of registered design, you should have that ability for unregistered design. If you have it for copyright, you should be able to prosecute for unregistered design. If you have it for trade marks, you should have it for unregistered design. All these intellectual property rights may be complex but they are a vital underpinning for our creators and our creative industries. I am unashamed in my wish for those creative industries to thrive in this country and for their intellectual property protection to be as solid as we can make it, without falling unduly into a monopoly situation, about which the noble Lord, Lord Borrie, is ever vigilant, I am glad to say.
Viscount Younger of Leckie
The noble Lord is quite right. I think it is best if I write to him on a number of the points that he has raised about Scotland. I could say something now, but I think a full answer is required. The noble Lord raised a number of questions, and we should give a holistic response.
The Government have sought to create a balance between protecting the rights of design owners and ensuring that innovation is not restricted. We believe that in this clause we have drawn the right balance. I commend the clause to the Committee.
Lord Stevenson of Balmacara
My Lords, I thank all noble Lords who have spoken on this topic, in particular my noble friends Lord Howarth and Lord Browne. Between us, including one or two of the points made by the noble Lord, Lord Clement-Jones, we have raised a sufficiently significant question about the desirability of this step being taken by the Government for us to think again before we return to this on Report. On the one hand, there is the question about whether the right approach to protecting the desirable end of making sure that those who design are able to proceed to the manufacture and exploitation of their designs without being ripped off by others is by some simplification of the overall system that might arrive at a better system or whether the criminalisation element will provide the necessary bulwark.
The argument is finely balanced. My noble friend Lord Browne said that he is uncertain about which is the right way, and I join him in that. I was not taking horses out for a trot on this point. I was, to change the metaphor, casting a fly on the water and seeing what would come up. I went fishing last weekend, which is why it is in my mind. I caught myself with my own fly and fell in, which was not a very successful outcome, but I was struck by the efforts of those with rods make to attract unwilling objects, such as fish, to come to the surface and bite the fly. You have to be careful what you are casting for sometimes, and my unease is that the simplicity of the central point—whether to introduce criminal sanctions—is becoming obscured by the complications of what might emerge if it happens. There is the question of the cost of the engagement of the police, trading standards and prisons and the impact on public spending, which my noble friend Lord Howarth raised. My noble friend Lord Browne was supportive in the sense that the criminal courts can easily take this on, as they have taken on many other things that Parliament has opined should be criminalised in the past several hundred years. On the other hand, it is a real change—from a specialist court dealing with well rehearsed topics, with practitioners who are knowledgeable in this area, to the hurly-burly of a magistrates’ court, or a sheriff’s court in Scotland, and then coming up through the system.
This is all quite a big step and I do not feel that the arguments have been as well marshalled as they could have been. The Minister brought forward some evidence but there may be more in his letters. I am looking forward to having many of those as we proceed through this, particularly my one on Bugs Bunny, which I can hardly wait for as the excitement is so intense. Germany is not necessarily the right model for this. We would have been happier if we could have seen more evidence from right across the design community. It is not a small community—we know the numbers, and there are lots of them. The danger in consultations of the type the IPO has carried out is that you hear from those who shout the loudest but do not hear from those who are going to have to make the thing work when the dust is settled. With those reservations in mind, we might have to return to this on Report.
Lord Stevenson of Balmacara
My Lords, although we come at this matter from a slightly different angle in trying to amend the clause to bring out a particular point, our intention is very similar to that of the noble Lord, Lord Clement-Jones. The points I would make on the narrowness of our amendment would rather duplicate what he is doing. It is better to simply say that we associate ourselves with what he said. I agree with what he is trying to do here to unpick a wrong turning proposed by the IPO. Where we are in terms of opinions on patents is well respected, understood and supported across the industry. To add this additional function, or change one of the existing pillars of the operation, would in fact change all the natures of the way it operates and is not to the benefit of where we are. With that, I support the amendment.
Viscount Younger of Leckie
My Lords, Amendments 25A and 25B relate to the patent opinions service. Amendment 25A, tabled by my noble friend Lord Clement-Jones, seeks to remove the power that will allow the Intellectual Property Office to initiate revocation proceedings where an opinion concludes that the patent is invalid. Amendment 25B, tabled by the noble Lords, Lord Stevenson and Lord Young of Norwood Green, seeks to insert the word “clearly” into the clause so that revocation will be initiated only when novelty or inventive step is clearly not satisfied.
Clause 15 allows a limited extension of the IPO’s existing powers to initiate revocation proceedings. It will help in particular SMEs and lone inventors who may simply be unable to afford to bring revocation action themselves. More broadly, it will be in the public interest to allow the IPO to seek the removal of certain invalid patents from the patents register. I reassure noble Lords that the IPO will only initiate such proceedings in clear-cut cases—where there is no reasonable argument to be made that the invention is new or not an obvious replacement of what has gone before. However, in those cases which are not clear cut there will be no revocation action.
I also wish to clarify that initiation of action will not always result in revocation. The patentee can submit observations that may demonstrate that his patent is valid. Alternatively, amendment may reduce the monopoly afforded by the granted claim. The patent holder will also be able to appeal any decision to revoke to the courts. The Explanatory Notes accompanying the Bill make it clear that the power to revoke will be exercised only in the most clear cut of cases. Therefore, I do not feel it is necessary to insert the word “clearly” into the legislation itself, as suggested by noble Lords in Amendment 25B.
Inserting the word “clearly” into the legislation may also lead to argument about what that word means, thus adding an unnecessary further strand to the dispute. For example, if the patent holder disagrees with the revocation and appeals to the courts, the court should not have to decide whether a patent is “clearly invalid” but should instead be free to decide the core question of whether the patent is or is not valid. The IPO is already able to seek revocation of a patent under certain circumstances. Experience shows that its officers would be well placed to assess whether revocation proceedings should be initiated following an opinion that concludes that a patent is clearly invalid.
Before answering a number of questions, I will finish by sharing with you the story of one SME which responded to the consultation in support of the government position. Shortly after it was set up, this SME became aware of a competitor’s patent for a similar product to that which it intended to sell. The SME requested an opinion on the patent, which concluded that the competitor’s patent was invalid. However, despite this alleged invalidity, the competitor continued to contact potential customers of the SME, warning them of possible infringement of their patent, and as a result customers stopped placing orders with the SME. The SME was therefore faced with the stark choice of either closing down or bringing revocation proceedings against the patent. It was apparently told it would cost £100,000 to bring such proceedings, and it simply could not afford to do so. In the end, the SME was fortunate in that it received backing from a much larger company, which enabled it to carry on trading and, indeed, to significantly grow the business. However, I am sure noble Lords can appreciate that such support cannot be guaranteed for all SMEs. As the example demonstrates, it is important that intellectual property does not become the preserve of only those with deep pockets. The clause as it stands, limited as it is and with the necessary safeguards to protect legitimate patent holders, will, I believe, further help to ensure that does not happen.
In his usual perceptive way, my noble friend Lord Clement-Jones raised a goodly number of questions. I will attempt to answer them all. First, he asked whether the procedure was TRIPS-compliant. The proposed legislation mirrors legislation already in place for revocation under Section 73(1) of the Patents Act 1977. The process of revocation will also mirror the process of revocation under Section 73(1). This process means that the revocation will also be considered by a more senior official than the examiner who issued the opinion. He will look at the details afresh and will not be bound by the conclusions of the examiner’s opinion when deciding whether revocation proceedings should begin. The patentee will then have the opportunity to address the alleged invalidity by way of amendment of his patent or by argument. He will also be able to appeal any decision to revoke his patent to the High Court. Further appeals are still possible, and this ensures that the procedure is TRIPS-compliant.
Lord Stevenson of Balmacara
The noble Viscount has just misquoted the section of the Act to which he was referring. If I heard him correctly—I will check Hansard—he referred to the comptroller issuing an opinion under Section 74A that Section 1(1)(a) or (b) is not clearly satisfied, which, indeed, was the intention behind our amendment. I take the point that the noble Viscount said earlier that the notes clearly say that it is envisaged that this additional power to strike off a patent will be exercised only in the clearest of cases where it is indisputable that the patent invention lacks novelty or inventive step. We are not very far apart on this. As I and the noble Lord, Lord Clement-Jones, said, the industry argues that the current phrasing is too bland to get across the sentiment which I think the noble Viscount is expressing—namely, that there has to be a clear exceptionality about the nature of the opinion. I hope that the noble Viscount will reflect on that matter and come back to it at a later stage. We need to get across the concept that the power will be exercised only in the clearest of cases where it is indisputable that the patent invention lacks novelty or inventive step. It is fine in the notes, but the notes are not the law, and the law needs to be right.
Viscount Younger of Leckie
It may be helpful if I clarify for the noble Lord that I was speaking in relation to the IPO’s practice and policy, as stated in the response to the consultees’ comments, in other words, as part of the consultation. However, I will reflect further on the need to tackle the point that he has made, as he has asked me to do.
Finally, my noble friend Lord Clement-Jones asked why patentees cannot recover their costs. If the patentee appeals to the court following a revocation by the IPO and is successful, he may be able to recover costs, but only if the court thinks that that is right.
I hope that I have managed to answer all the questions. If I have not, I will certainly follow up with a letter. I thank my noble friend Lord Clement-Jones for putting so much effort and thought into his range of questions on this important subject. I hope that in the light of my comments, the noble Lord will not press the amendment.
(3A) No information shall be sent to a patent office outside the United Kingdom (“the other office”) in reliance on subsection (3)(aa) unless the other office provides the application number of a UK patent application and the application number of a patent application being examined by the other office which claims priority from the UK patent application; and no such request shall be acted on before one year from the filing date of the UK application.
(3B) Any information sent to the other patent office must be limited to information on search or examination carried out on the UK application.
(3C) Information shall not be sent to the other office unless working arrangements have been agreed between the comptroller and the other office, including provision for ensuring that the confidentiality of the information sent to the other office is protected.
(3D) The applicant for a UK application for which a request for information has been made by another office shall be informed of the request and of the information sent to the other office.
(3E) Information shall not be sent to another office in reliance on subsection (3)(aa) unless that other office is an organisation which carries out, in relation to patents, functions of the kind carried out by the patent office and which is on an approved list, which may be varied from time to time by statutory instrument.””
Lord Stevenson of Balmacara
My Lords, Clause 17 relates to the exchange of information with other patent offices. The idea behind this provision is, we suppose, to allow the exchange of search and examination results for unpublished applications, as information about published applications is already exchanged. The current exchanges increase efficiency, save duplication and unnecessary work, and are in every way admirable. Perhaps such exchanges are contemplated only with major offices, such as the USA, Europe, Japan and Korea.
The effect of the proposals is much less clear. The new power given by the section is extremely broad. Any information that the other patent office requests may be sent subject to the working arrangements made with the other patent offices, of which only protecting confidentiality is said to be essential. Any patent office, which is quite broadly defined, may request the information. Possibly in the case of smaller countries the information provided from the UK could substitute for a local search or examination, which is not unreasonable, unless such requests would make too much extra work for the UK office.
The working arrangements are completely at the discretion of the comptroller. They do not have to be approved by Parliament, unlike many other powers proposed under this Bill. There is no limitation on the type of information that may be exchanged or the form in which it might be requested. For example, a request might be for details and copies of all applications in the name of company X relating to technology Y. Our amendment suggests that the provision should be substantially limited, in the following ways. Information to be exchanged should be limited to search and examination results. Information should be provided about UK applications only, designated by a UK filing number, from which priority has been claimed in the country of the patent office seeking information. No information should be provided earlier than one year from the date of the UK filing unless the applicant agrees otherwise. The UK applicant should be informed of the request and the information provided. Information should be provided to patent offices of countries on an approved list only, to be added to from time to time by statutory instrument. I beg to move.
Viscount Younger of Leckie
My Lords, Clause 17 will allow the Intellectual Property Office to share patent information on unpublished patent applications with patent offices outside the United Kingdom on a confidential basis for their use in processing similar patent applications filed with them. This will help speed up international patent processing. I hope that noble Lords will bear with me, as I have much to say in speaking to this amendment.
Amendment 25E would place various restrictions on the circumstances in which information may be sent to a patent office outside the United Kingdom. First, the amendment would introduce a requirement that the other patent office must quote the application number of a UK patent application when it requests information. It is absolutely the intention that information will be shared with other offices only where they have specified what information is required and in relation to which patent application, identified by the application number. It is for this reason that Clause 17 applies to such information as that office requests and only in accordance with the agreements made by the Intellectual Property Office. This is the approach taken when the IPO provides information to the European Patent Office in accordance with Section 118(3)(a) of the Patents Act and the European Patent Convention.
Secondly, the amendment would restrict the arrangements so that information could be shared only when an application had been filed abroad following a UK application. In practice, it is only when the other office is dealing with an application, which follows on from a UK application, that it will be able to gain any benefit from seeing the results of the UK work.
Lord Stevenson of Balmacara
I thank the Minister for his very full response to the amendment. I think we are very close on a number of the matters. I did not pick up from his response whether this is for unpublished patents only, but perhaps he mentioned it, so I shall read Hansard carefully. I am grateful for the assurance that he has given, which will be of considerable interest to the patent industry. I beg leave to withdraw the amendment.