Mike Weatherley
Main Page: Mike Weatherley (Conservative - Hove)Intellectual Property Bill [Lords]
Mike Weatherley Excerpts(10 years, 11 months ago)
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Mike Weatherley (Hove) (Con)
Does the hon. Gentleman agree that it may be time to start moving towards a US-style IP tsar to co-ordinate the various Departments?
Mr Wright
I think the hon. Gentleman is pitching for that job, so he should have declared his interest. However, he makes an important point. During deliberations in Committee, it will be important to table amendments to consider what the Intellectual Property Office will do to promote innovation and jobs in the UK economy. Having some sort of IP champion, IP tsar, or whatever the hon. Gentleman wishes to call the role, needs to be considered closely, and hopefully we will do that in Committee.
Let me turn at last to manufacturing. High-value manufacturing is dependent on innovative design to produce comparative advantage. Indeed, high-value manufacturing in the 21st century requires a blend of design, creativity, innovation and production to compete and succeed. Modern means of research, development, production and distribution all emphasise in the modern age open, innovative models and the sharing of ideas. That makes IP more, not less, important.
The increased proportion of intangible assets on the balance sheets of many firms means that there is an ever-growing importance to securing returns from those assets. That in turn means that companies need to pay more attention to IP issues. In the 21st century, a strong intellectual property regime is needed. IP should not be seen as regulation or bureaucracy, with all the negative connotation that that entails. IP is not regulation but a legal right, and it would be wrong to suggest that, in an era of globalisation and digitisation, IP is irrelevant or an anachronism that needs somehow to be swept away. Businesses will not invest if their innovation or creativity is not protected. If somebody has created or invested in something, they should have the right in law to derive benefit from that creation or investment. That right should be protected and enforced by the legal system.
The Minister rightly referred to the recent global IP index, produced last year by Taylor Wessing. It should be a source of pride to the House that the UK was placed No. 1 in the world for IP. We need to protect, maintain and enhance that position as much as possible. However, the difference between the top three ranked nations in that report—the UK, Germany, and Netherlands—was only 0.2%, showing intense global competition and the perils of introducing proposals that might undermine our position as No. 1 in the world.
Mike Weatherley (Hove) (Con)
It is a great honour to follow the hon. Member for Perth and North Perthshire (Pete Wishart). I greatly respect his views on intellectual property, and I thank him for his kind comments.
Intellectual property affects every one of us. We have heard from the Minister about its importance to the economy. The statistics speak for themselves: the creative industries are worth more than £71.4 billion a year in gross value added terms, which is 5.2% of total GVA in the UK; they generate £130,000 every minute for the UK economy; they employ 1.7 million people in the UK, which is 5.6% of all UK jobs; and, at £15.5 billion, they account for about £1 in every £10 of the UK’s exports. Without a vibrant creative economy, our deficit would be higher and our services worse. I am often told that the creative industries are not as important as the NHS, but one thing is certain: without them, we would have a much reduced NHS. Every person in the UK benefits from a thriving creative sector.
As the intellectual property adviser to the Prime Minister, I am well aware that a strong intellectual property culture and regime is the cornerstone of how we do business, and that protecting intellectual property rights is essential for growth. I therefore broadly welcome the measures in the Bill. By valuing intellectual property, we help not only the UK businesses and investors that take the brunt of the litigation headaches arising from intellectual property and copyright infringement, but the consumers by ensuring that the public are able and willing to buy the most legitimate product available, and that creators or authors of products are financially remunerated.
A focus on the entrepreneurial aspects of intellectual property is vital to helping Britain succeed in the competitive global market. Alongside that focus, winning the hearts and minds of the public on intellectual property—in all its forms, from patents to copyright—is essential to the future of our creative industries, world-beating brands and, indeed, the country as a whole.
As many colleagues will know, I pioneered the Rock the House and Film the House initiatives to educate right hon. and hon. Members about intellectual property, and to bring them into contact with musicians and film makers in their own constituencies. Such initiatives for music, film and other creative industries are important in winning the public relations battle. Industry has a huge role to play in that regard, as do the Government. I welcome the initiatives of the Industry Trust for IP Awareness, the Alliance for Intellectual Property, the BPI and many others. With those organisations, I will be exploring what more can be done to ensure that there is greater collaboration and co-ordination between industry and Government with respect to educational initiatives.
The Government have started to tackle the issues that plague intellectual property law enforcement, and the Bill addresses some of those issues head-on. From the introduction of criminal penalties for deliberately copying UK-registered designs to extending the expert opinion services delivered by the Intellectual Property Office to include registered designs, the Bill will bring to design rights the same level of protection that is afforded through copyright and trade marks. In addition, the implementation of the unified patent court agreement proposed by the Bill will lead to direct benefits to UK business of up to £40 million per year. Simple changes, such as providing the option to mark a patented product with a web address, rather than a patent number, and allowing the sharing of information between international patent offices, could reduce the burdens on businesses and individuals, as well as alleviate the backlog of more than 4 million patents worldwide.
Before I discuss what additional measures it would be beneficial to incorporate in the Bill, I will expand briefly on some general points. With industry, I have developed a three-pronged plan for how to address intellectual property issues in my position as the Prime Minister’s IP adviser, using education and the carrot and stick.
As has been mentioned today, education is all about winning the debate about cheap or free goods. We must make the argument that if people get something cheap or free, they will eventually get only cheap goods or none at all. We must use education to get the public on side, with a focus on young people. We must convince people that piracy and similar illegal activities are not in their best long-term interests and are not socially acceptable. My goal is to have young people telling their friends that illegally downloading content or buying counterfeit goods will harm them all in the long run and is just not right. Their friends who might want to carve out a career as musicians will be the hardest hit.
Ultimately, we will all be hit hard. I mentioned some impressive statistics at the start of my speech. The creative industries are the third largest employer in the UK and we are one of only three countries worldwide that are net exporters of music, the other two being the USA and, perhaps surprisingly, Sweden. As I have mentioned, all our public services will be hit if we lose that enormous revenue stream for the country.
The second part of the process—the carrot—is about providing incentives. We must challenge the creative industries to step up and provide appealing, consumer-focused services for their products. Some companies, such as Spotify, Netflix and Bloom, are already doing work in that area, but there are many more possibilities to be tapped. Indeed, there was a Rock the House seminar on that very topic in December last year, chaired by my hon. Friend the Member for Morecambe and Lunesdale (David Morris), at which the industry discussed the role of innovation in protecting British intellectual property rights.
We must encourage supportive industry measures. PRS for Music has proposed a traffic light system for search engine results that would inform consumers whether a site is legal. The Content Map is a web portal that lists all legal services across music, film, TV, e-books, video games and sport broadcasts, providing an invaluable service to those who are unsure whether a site that they or their children are using is safe and legal. Another example is the IPO-funded whiteBULLET initiative.
Finally, I come to the stick. To address abuses of intellectual property, there has to be IP enforcement legislation with real teeth. There are welcome measures in the Bill, such as increasing the protection of design rights. There are other measures, like increasing the maximum penalty for digital copyright theft, that are not in the Bill but perhaps should be. Another enforcement measure would be to follow the money and stop advertising and payment facilities on websites that host illegal content. Internet service providers and search engines would also be accountable if there was known to be criminality. Ultimately, we need to consider withdrawing internet rights from lawbreakers, along with imposing fines and, as a last resort, custodial sentences.
The technology is available to bind the various strands together, and just a little help from the Government is needed. Perhaps it is time, as has been mentioned, to consider a USA-style IP tsar to co-ordinate all the interested Departments and the industry. Perhaps the hon. Member for Lewisham West and Penge (Jim Dowd) would be good in that role. I can think of 10 worse people to have.
Like other Members, I am grateful to the Alliance for Intellectual Property, which has produced a useful list of recommendations on how the Bill could tackle IP issues more effectively. It has rightly pointed to clauses 13 and 21 as especially vital. Clause 13 creates a new criminal offence for deliberate infringement of registered designs. That addresses the long-standing anomaly that a 2D drawing receives greater protection under the law than its 3D manifestation. To provide any significant benefit to UK designers, the provision must be extended to cover unregistered designs. My hon. Friend the Member for Beckenham (Bob Stewart) raised that matter earlier and I would be happy to explain to him in greater detail why that is required.
Certain sections of the manufacturing industry that rely on innovations to maintain their position as market leaders are concerned that clause 13 could turn their directors into criminals when something is copied unwittingly. The Bill is clearly not intended to have that effect. On balance, I think that their fears will be unfounded in practice.
Clause 21 introduces a requirement for the Secretary of State to report annually to Parliament on how the activities of the IPO have supported innovation and growth. That is welcome, but ideally it would include how those activities have supported the businesses and individuals who create and own intellectual property, not just those who seek to exploit it.
Further measures that the Bill could include are an increase in the maximum penalty for digital copyright theft from two to 10 years, which would match the penalty for physical copyright theft. I support that proposal. The same crime is being committed and matching the penalty would show that the Government agreed. In addition, more effective protection is needed for brands that fall victim to clone packaging, as we heard earlier.
The Bill deals with only a relatively small area of IP. It does not include any of the supportive measures of the Digital Economy Act 2010 or any of the Hargreaves exception recommendations. Indeed, this is a missed opportunity to debate those exceptions on the Floor of the House. The Bill shows that the Government wish to strengthen IP importance and enforcement. However, the Hargreaves exceptions have the potential to send out exactly the opposite message, with a plethora of IP relaxation measures that will introduce new exceptions for parody, text and data mining, and private copying.
The Hargreaves exceptions will affect businesses that employ significant numbers of people in the UK, so their wording matters greatly. The wording needs to be tight and must not go further than is necessary to implement Government policy. For example, the statutory instrument on private copying needs to ensure that the definition of private copying does not mean the wider definition of “friends and family”, as it does in Europe. Creative content providers are very concerned that the education exception may extend beyond the classroom. I cannot emphasise enough the importance of considered drafting. It will define the Government’s approach to IP. We await with bated breath the wording of the statutory instruments relating to Hargreaves. However, I fear that it may be too late and that we will send the wrong message to our creative industries and to European legislators. We shall see.
There is one further useful amendment that could be made to the Bill. I suggest that there should be an amendment to encourage the IPO to put education at the heart of its activities. The IPO has some good initiatives, but I believe that they could be expanded. Clause 21 places a reporting duty on the IPO that relates to innovation. My proposed amendment would add a requirement to report on the educational aspects of its work. Specifically, it would ask the IPO to report to the Secretary of State on how the activities of the Patent Office have contributed to promoting an understanding in the United Kingdom of the importance of intellectual property and its effective exploitation, and how the activities of the Patent Office and other UK institutions have contributed to educating users of creative content about intellectual property and intellectual property rights.
Ultimately, the Bill provides us with an opportunity to lead the world in raising awareness of the importance of intellectual property and IP enforcement. Ian Hargreaves recommended that we need an IP framework that is responsive to change. He was right. The Bill is one step in that direction. I urge the Minister to consider the points that I have made and, if at all possible, to include my recommendations in the Bill.
To summarise, I have suggested an extension of clause 12 to include unregistered designs, an increase in the maximum penalty for digital copyright theft to 10 years, more effective protection for brands in relation to clone packaging, an extension of the reporting requirements of the IPO to include educational activities, and the consistent promotion of the benefits of a robust IP framework. Above all, although away from this Bill, I urge the Government to be careful about the wording of the Hargreaves exceptions statutory instruments.
Mr Sutcliffe
How soon I forget. My hon. Friend is right: Viscount Younger did come before the Select Committee, but the hon. Member for Wantage, who is also a Minister from the Department for Culture, Media and Sport, also gave evidence to the Committee on IP rights.
The Committee’s report is worthy of being read by hon. Members who have not yet done so, given the impact that creativity can have on well-being, innovation, and the growth of potential new jobs. When the Committee went to America to look at the creative industries—a difficult job but somebody has to do it—we went to Google and to the film studios. I found it interesting to note the importance of tax credits to the film industry. Film tax credits are one thing I will congratulate the Government on, and moving those measures to high-end television and games will maintain our lead in such things.
Mike Weatherley
Does the hon. Gentleman support my call for the music industry to have a tax credit for A and R, perhaps above the 20% level that they would normally spend?
Mr Sutcliffe
I do. I know it is difficult when, in austere times, we are asking the Treasury to give more tax breaks, but I think it is a case of invest to save: if we do that for the music industry, we will get more back in the fruition and growth of that sector. I support what the hon. Gentleman proposes.
I think that Google has responsibilities and needs to consider the issue raised by BPI—I had forgotten that so many million requests have been made, and I do not think Google responded in anything like the way it needed to. I hope that with this debate, and with pressure from Ministers, we can put some pressure on Google to meet its requirements and responsibilities.
Clause 21 concerns the IPO report. I was grateful that the Minister said that Members would be able to consider all aspects of that report annually, though there are areas where things have not worked out as well as they could have. Returning to my former role as the Minister responsible for consumer affairs, I remember that on issues like trading standards, reports came from many areas of the country showing that things worked well in some places, but not in others. Enforcement is a big issue, and perhaps when we get the opportunity in Committee, we can look at the role of the IPO, trading standards, packaging, and some of the goods that mimic others. As a former sports Minister, I think particularly of the football industry where counterfeit football shirts and so on are produced. There is a tremendous cross-section of areas to consider, which is why it is important to have an IP tsar. We will want to consider clause 21 in greater detail, as well as clause 13 and the issue of criminalisation.
Helen Goodman (Bishop Auckland) (Lab)
I am pleased to have the opportunity to speak in the debate. I agree with everything my hon. Friend the Member for Hartlepool (Mr Wright) said at the beginning of the debate and am pleased to see a joined-up approach between the teams from the Departments for Business, Innovation and Skills and for Culture, Media and Sport.
As the hon. Member for Burnley (Gordon Birtwistle) has said, protecting intellectual property is essential in the modern, knowledge-based economy. It is particularly important in the creative industries, which support 1.5 million jobs and produce about £36 billion-worth of output.
The hon. Member for Perth and North Perthshire (Pete Wishart) described the problem of illegal downloads, but he did not tell the House how large the number of illegal downloads is when aggregated. Ofcom estimates that, every three months, 280 million music tracks, 52 million television programmes, 29 million films, 18 million e-books and 7 million games are downloaded from sites without payment. It also estimates that about a fifth of households in this country go to those sites and do not pay for content. On behalf of the music recording industry, the BPI estimates that that costs the industry £250 million a year.
In the wash-up at the end of the previous Parliament, Labour and the Conservatives—the two major parties—agreed to pass the Digital Economy Act 2010. Unfortunately, the Government have been extremely dilatory in implementing its provisions. I am not saying that the provisions are perfect in every respect and that they do not need amendment, but the Government’s failure to get to grips properly with illegal downloading will cost the industry more than £1 billion in the lifetime of this Parliament.
The Government’s measures will not come into effect until the end of the next calendar year. They propose a voluntary code for ISPs. Under the Bill, the ISPs would notify people three times, after which the copyright holders of illegally downloaded content can call for slow connections, disconnections and so forth.
I do not agree with the proposals of the hon. Member for Hove (Mike Weatherley), the Prime Minister’s adviser, because he has brought no common sense to the debate. It is important that we distinguish between 14-year-olds in their bedrooms downloading two or three Justin Bieber tracks on to an iPod and people who make multi-billion pound businesses out of providing illegal material. It is not right to treat the two groups in the same way. We need measures that address the audience, who are unconscious of what they are doing, and the industry, which knows perfectly well what it is doing and is utterly disingenuous. [Interruption.] The right hon. Member for Wokingham (Mr Redwood) is mithering from a sedentary position. I am not saying that there should not be a penalty for the teenagers downloading material illegally, but I am saying that we should regard the problem much as we regard driving fines—we should have a points system building up to fines.
Mike Weatherley
My point was that, when we get the education right and people understand that stealing intellectual property is wrong, and when the industry has alternative downloading models, if we exhaust fines and other means of stopping persons downloading illegally, we must consider some sort of custodial sentence for persistent offenders and people who operate on a commercial scale.
Helen Goodman
The point is that the people operating on a commercial scale are in a different category and should be dealt with much more severely. I completely agree with the hon. Gentleman that education must be part of that strand, but I am uneasy about switching off the internet because, for example, the 12-year-old little sister of a 16-year-old who illegally downloads pop music might be unable to upload her school home work. That does not seem to be the right way to go about dealing with the problem. But if the governing party wants to charge into criminalising every teenager in the land—well, that is an election opportunity for them.
To make any of this happen, it is obvious that we must reform the Intellectual Property Office, which does not have an important role at the moment. The hon. Member for Hove said nothing about what should be done with respect to the industry. The hon. Member for Perth and North Perthshire was absolutely right: we must have an EU approach. I know that that pains Ministers and means that they will have to see off the wilder shores of Euroscepticism, but this is a perfect example of where we need to see a European approach. Two points are particularly important: blocking sites that give people access to material they do not pay for; and requiring search engines to change their algorithms to prioritise legal sites. It is completely disingenuous for them to say, “Oh, we have received 5 million notifications and blah-de-blah-de-blah.” We all know that this is the root cause of the problem, so let us tackle it.
We must remember that this industry is one engine of growth in the British economy, but we must also take seriously the needs and the role of researchers in universities and in the British Library. We must update the law to allow them to have what they need: text mining for non-commercial research; heritage protection by digitising material; a workable private copying regime; and ensuring that the law overrides private contracts on digital material. The Hargreaves report came up with a number of proposals. Some were sensible—on orphan works and digital exchange—while others were perhaps more controversial, but one point on which I think we can all agree is that we do not wish to move the British economy to a litigious model, with the levels of litigation that are prevalent in the United States.
What I will say now relates in part to unregistered design. I have a concern about people putting patents on things that are part of the common culture, either here or overseas. For example, the recipe for a cucumber sandwich or people singing “Ring a Ring O’ Roses” at a children’s birthday party are a part of the common culture. Those examples might seem a little fanciful to hon. Members, but I will provide two examples where the common culture has been appropriated by some people to their financial benefit, and not necessarily to the financial benefit of all.
In the 1950s, some people collecting folk songs went to Teesdale in my constituency. They went right to the top of the dale and met some stonemasons. They got the stonemasons to sing songs and recorded them. They took the recordings away and shared them with people making music. One of the songs they recorded was “Scarborough Fair”. This was given to Simon and Garfunkel, who of course made an absolute fortune with it, and the stonemasons in my constituency made absolutely nothing. I think Simon and Garfunkel are great and they made a lovely production of the song, but it was a part of our common culture.
Today, we see this kind of thing going on in other industries. Sometimes there are glamorous models shimmying along the catwalk wearing prints that, not to put too fine a point on it, have been ripped off from people in Africa. The people in Africa, who have been making the prints for generations, get nothing, but the people who reproduce them patent the design and make an absolute fortune. I am sure that hon. Members agree that this need not to patent the common culture is something that we need to keep in our minds, so that we do not shift from one situation that deprives people who are genuinely making new, scientific innovations and discoveries, to a situation where we put legal attributions on every single idea and part of the common culture.