Intellectual Property (Unjustified Threats) Bill [HL]

Lord Stevenson of Balmacara Excerpts

Wednesday 15th June 2016 Grand Committee

[Lord Stevenson of Balmacara (Lab)]

My Lords, unlike the noble Lord sitting on my left who admitted he got into this with only 24 hours’ notice, or slightly more, I have seen this coming for some time. However, that did not help ease my nerves or concerns, particularly when I saw the notable list of those who are speaking, including—I am able to say this for the first time—my noble kinsman, the noble and learned Lord, Lord Hope. It is a very distant relationship but it is very nice to be able to say that. The noble Baroness, Lady Bowles, speaks from detailed experience, and my nerves did not settle as I listened to the debate. However, fortune favours the brave and we must make progress on this important issue before us. I want to make it absolutely clear from the start that Her Majesty’s Opposition do not wish to oppose the Bill in any sense, although we might wish to see it improved. My main point will be that there is a wider context, and I hope some of the points that have been made today might be brought forward, in particular as we have evidence sessions—a point I will come back to.

I thank the Minister for her very good introduction to the Bill, which covered all the ground needed to get us into the debate. I also thank her for the helpful pre-meeting which we had with the Law Commission and the official Bill team, which certainly helped to set us up for this. As the Minister said, we are in a relatively new process, which is being used for only the second time here. As I have already hinted, the key to the way forward on this—because it does not apply to many Bills that we see in your Lordships’ House—is that we will have an opportunity to ask for evidence to be presented to us before we get into the detailed scrutiny. Given that we are not opposing the Bill, my points today will therefore be largely about suggesting areas where we might receive some additional information which will help us as we move forward.

The first point is one that has been picked up in a couple of speeches today, and appears every time we have an intellectual property Bill in your Lordships’ House. It may be that we do not have enough intellectual property Bills, which therefore feeds this desire for a wider and broader discussion—I can see the Minister quailing slightly at that, but I think that is broadly a good thing. After all, she started her work in this House with a robust defence of an issue, I think with the Enterprise and Regulatory Reform Bill—I forget, as it was two years ago when she first joined us. That was a bit of a baptism of fire, but she survived that and is now able to bring Bills before us with great confidence and skill.

However, I do not think we have ever really had the chance to debate the assertion made in some of the documents we have seen today, which I think was picked up by the noble Lord, Lord Hodgson, in his remarks. The reason for having an IP regime is precisely because it encourages a flow of wealth, employment and rewards based on the ability of those who have innovation at the heart of their work to develop that and bring to the market material, objects and things that can be sold for reward.

I wonder whether the links between the incentive needed to encourage innovation and the rewards are slightly out of sync, particularly looking across the range of rights. The design right regime is still being changed slightly. Today we are mostly talking about registered design rather than the huge amount of unregistered designs, which I believe are orphans in our discussions about IP rights. Patents and copyright are moving in slightly different directions, particularly in relation to the timescale in the licensing arrangements following the granting of such rights, and the way in which competition can be encouraged. This is not the occasion to do this but, as a context for the debates we are having today, it would be interesting to get a broader discussion. Maybe the evidence sessions could do that.

My second point was raised by the noble Baroness, Lady Bowles. It is an important point and I hope that we do not lose it. At a time when, as a country—or perhaps more in terms of the broader thrust of consumer rights—we are moving to an alternative dispute resolution system, it seems a little strange that we do not see much of that in the Bill. I therefore wonder whether it would be interesting to get more context for how Civil Procedure Rules and the rest would apply if there was a more vigorous and appropriate ADR system. I think that would be a helpful and useful part of what we are doing.

We owe a great debt of gratitude to the Law Commission for its work on this. I have read right through its reports and appreciate the considerable amount of work that was involved in getting us to this stage. The main reason for changing the law is that the present arrangements are complex and inconsistent. We are responding to that, and the Bill clearly takes a line on this, which the Law Commission calls “an evolutionary approach”. Part of its argument for that approach is that there is less cost and uncertainty, which is a point that I think was picked up by the noble Lord, Lord Hodgson. I agree with that in the sense that it is a sensible path through and we can do it. However, as we have heard—a number of noble Lords mentioned this—there is another much more radical approach that would bring the UK into line with how threats are dealt with in mainland Europe. As we heard, most countries deal with groundless or unfair threats as an aspect of the general law on competition, in particular by producing a tort which would reflect that. Where there is a specific tort, this brings us back to the Paris Convention for the Protection of Industrial Property, where signatory states are required to offer effective protection against unfair competition and specific acts are prohibited. It also goes much wider in relation to false allegations in the course of trade and some of the points that we have heard about needing to bring back a sense of the proprieties of business practice, which seem to have come a bit detached from the rather technical approach that we are taking in this Bill. Therefore, I would like to hear evidence in Committee around where this debate might go. Assuming it goes through in broadly the same form in which it is before us, is there a horizon that we can look to over which will come a cavalry charge bringing in the new tort that might bring a broader and better solution to the issues we face today?

Fourthly in my list is the question of client and professional adviser relationships, which has been touched on, in particular in the comments by the retired judge, Sir Robin Jacob, who thought that this was a rather bad idea. I think his words were that there were too many cowboys out there. He would argue that the provision that is now in the Bill appears to be in response to special pleading by solicitors to avoid liability and get more work while writing more letters to scare SMEs. That may be an extreme position. Indeed, the number of responses has already been quoted in respect of the general support that there appears to be for the Bill as presently drafted. However, it seems to me that, by taking a step down this route, the Government may be attacking the whole basic common-law position on the liability of agents acting on the instructions of their principals. We should perhaps hear a bit more about this before we take this step because, once it has happened here, it may have an impact somewhere else. Why is it, for example, that we are choosing to cover US lawyers and others, not those based in the UK, on this matter? Are there not other ways in which those who might be threatened by this could take cover within either their own professional organisations or through insurance? I do not have any expertise in this area at all but I have received representations on it, and we should have a bit more understanding before we go into it.

That is an agenda for how Committee might be prefaced by an information stage. This is a small and important Bill, which we can get through relatively quickly, but the processes and procedures are important. It should be borne in mind that when embarking on this process, we in your Lordships’ House are largely taking the responsibility for ensuring that the material that goes forward to the other place has been properly looked at and explored, and obviously we need to have the sort of scrutiny that would give credence to that approach. But having said that, I am happy to support the Bill, and I wish it well.