Intellectual Property Bill [Lords]

Nadhim Zahawi Excerpts

Monday 20th January 2014 Commons Chamber

[Nadhim Zahawi (Stratford-on-Avon) (Con)]

It is all too easy to characterise this as a Bill of interest only to lawyers—one that is technical in nature and of little interest to the general public or the great British entrepreneur. Indeed, the title, the Intellectual Property Bill, does little to describe its underlying purpose, for this is not a Bill about the law; it is a Bill about creativity and innovation.

Every year, UK businesses invest nearly £16 billion in design and innovation. That is £61 million per working day, an incredible figure that represents 1.1% of GDP. The Bill is about not just protecting that investment, but growing it. It is about ensuring that British businesses are able not just to win in the global race, but to protect the advantages that got them to the top of the podium in the first place. Like many other of the Government’s policies, the Bill is about ensuring we attract the best talent and the best companies to the UK. When it comes to business and economic policy, this has been a recurring theme of this Administration.

When I was the chief executive of a global business looking to enter a new market, my board and I would carefully weigh up the tax and regulatory regime before deciding on a host country for the venture. Much has been made of how corporation tax impacts on this decision, and with the rate set to fall to 20% there is no doubt this will become an ever-increasing pull factor, but we should not underestimate the importance of the intellectual property protection regime. As the global race becomes ever more the battle for ideas and innovation over the battle for cheap labour, this will become an increasingly important concept.

As a member of the Select Committee on Business, Innovation and Skills, I sat on the inquiry into the Hargreaves review. Opposition Members would like to characterise the Bill as having little to do with Hargreaves’s findings, but you, Madam Deputy Speaker, will not be surprised to hear that I disagree. At the heart of Hargreaves’s recommendations was the need for copyright laws to recognise that IP is a tool for stimulating economic growth. I am confident that the changes implemented by the Bill will do just that: stimulate economic growth and help to secure the continuing recovery.

There are many admirable clauses in the Bill, but I should like to highlight a few in this context. First, on the creation of a criminal offence of infringement of a registered design, our IP framework already has criminal sanctions for breach of copyright—in the case of music, for example—and breach of trade marks to protect brands, but this change recognises that creativity of design is as important to the economy as any other piece of intellectual property. In doing so, it gives creators an additional tool to protect their creativity from the blatant copying that impacts on their bottom line. One also hopes that the threat of criminal sanction will deter such copying in the first place.

Clause 15 brings patent notifications into the modern world. Currently, in order to obtain the maximum protection, patent owners must mark every single patented product with all the relevant patent numbers, but the clause will allow them instead to mark products with a website address, reducing costs while maximising protection. It will also allow a patent holder to update the information as new patents covering the products are granted. I understand that such a system already operates in the US to great effect.

The Bill also proposes many reforms to the Intellectual Property Office, all of which will reduce costs for business and decrease uncertainty. In particular, the extension of the IPO’s patent opinion service to give non-binding opinions on patent validity and the introduction of a design opinion service will help resolve disputes without the need for costly litigation. It is right that businesses have the option of litigation, but it should not be the first port of call or the only way of testing validity. These reforms will help with this often-heard complaint.

I should also like to highlight the basic structural and operational reforms proposed to the IPO, such as allowing it to provide online inspections of registered design files and permitting changes to statutory forms, and even business hours to be made by directions rather than secondary legislation. It is unbelievable that should the IPO wish to extend its opening hours, secondary legislation would have to be passed in this House. I also welcome clause 21, which implements Hargreaves’s recommendation that the Secretary of State report annually to Parliament on the IPO’s activities and specifically on how they have contributed to the promotion of innovation and economic growth. This increased transparency can only be a positive move.

The final area in the Bill of interest to growth are clauses 8, 17 and 18, which relate to the international and European IP systems. Implementing the unified patent court agreement is a central requirement to creating a single EU patent, and such a patent would save British business about £40 million a year in translation costs when it seeks to protect its innovation EU wide—something that will be most welcome.

To conclude, this is a Bill not for lawyers but for business. It will ensure that British business secures its position in the global race and attracts winning businesses to the UK. It is a Bill that I fully support.