My Lords, this summer Britain emphatically demonstrated the quality of its creative talent to the world in the opening and closing ceremonies
of the London Olympics and Paralympics. The Government have done much that is positive to support the UK creative industries, not least through the new IP attachés, the new tax break for video games and high-end TV production and the extremely important work of Mr Richard Hooper in the creation of a copyright hub to simplify and improve copyright licensing, which has the enormous good will and co-operation of all rights holders concerned.
However, as a recent All-Party Parliamentary Intellectual Property Group report has demonstrated, there is real doubt about the championship of intellectual property in this country, not least by the IPO itself, which is reluctant to accept intellectual property as in reality a property right. Creativity, content and copyright are crucial for future growth and investment, yet Professor Hargreaves and others express the view that copyright is a barrier to innovation. As a result, I fear that we risk going on the wrong track with copyright reform and having an IPO which has lost the confidence of creators and the creative industries.
My noble friend the Minister, who I have every hope has assumed the role of IP champion, has been very willing to engage in discussion about Clauses 65 to 69 in Part 6 of the Bill dealing with copyright and rights in performances, but the fact is there are still a great many questions to be answered during the passage of the Bill and it is that area that I wish to focus on today. I start with Clause 65. This clause has been widely welcomed by designers. It means that copyright for works of artistic craftsmanship will now last for the usual term of copyright: that is, life of the author plus 70 years. However, others have not been so welcoming. The Minister will have seen the letter to the Times of 25 July signed by Lionel Bently, Herchel Smith, Professor of Intellectual Property at Cambridge University, and others. They asked: where is the impact assessment for this measure? Why was there no consultation?
We are assured that there will be transitional provisions and that there will not need to be a bonfire of unauthorised copies after the Bill comes into effect, but what are the specifics? Why do we have to wait until the clause is on the statute book before we know what they are? Why not outline the provisions at this stage, in particular those which will permit stock which is currently legal until this clause becomes law to be sold, and then consult on them? What about using or making images of these artistic works for illustrative purposes? Will this be a breach of copyright after this clause goes through? Publishers, galleries, museums and academic institutions need to know that.
Then we have Clause 66, which has already been the subject of some comment. Amendments that were made on Report stage in the Commons are welcome as they help to clarify that the Government cannot use the clause more widely than is permitted under the European Communities Act 1972 except as regards criminal penalties. Furthermore, it appears that the application of Clause 66 in relation to penalties will only be in respect of copyright exceptions. If that is the case, why is the clause not simply worded so that it is targeted specifically at introducing penalties greater than those permitted under the European Communities Act, as set out in the Explanatory Notes? As an aside,
the Minister will, of course, be aware that there is a major doubt whether the Court of Appeal Oakley Inc v Animal Ltd case of 2005 would allow the Government to implement much of what the Hargreaves report suggests by way of extensive copyright changes by statutory instrument. Will the Minister confirm whether the Government have received legal advice on that?
Exceptions to copyright are potentially of huge economic importance to rights holders and creators. The fact is that all major previous copyright changes were enacted by primary legislation—the 1911 Act, the 1956 Act and the 1988 Act. Surely that should be the rule for all future legislation. What assurances can my noble friend give in that respect that primary legislation will normally be used? Even if my noble friend cannot concede that point, it might help if we knew exactly what the Government’s intentions were. When are we going to see, and be consulted on, the draft regulations bringing in the various exceptions recommended by Hargreaves such as format shifting, parody, data mining, right to digitise and so on? Crucial issues still remain to be resolved with the exceptions. Will there, for example, be an exception for photographs from the parody exception? Cannot the draft regulations for these exceptions be published with the relevant consultation paper while the Bill is going through the House? Furthermore, can the Minister give an absolute assurance to this House that, contrary to the fears of many, if regulations are used to introduce exceptions they will not be bundled together in a single statutory instrument and an individual impact assessment will be produced for each exception proposed?
Clause 67 enables the Government to reduce the term of copyright for unpublished works or published works which are anonymous or pseudonymous. The Minister may be pleased to know that I am not going to dwell long on Clause 67. However, there is a major problem here, too. Are the Government seriously proposing that unpublished works by Robert Graves, who died in 1985, or Christopher Isherwood, who died in 1986, should be prematurely thrust into the public domain and the owners of these rights summarily deprived of them? Is this a way of enforcing publication when authors or their estates do not want it?
Clause 68 deals with orphan works and extended collective licensing. The major question on orphan works is why we are going further than the EU orphan works directive which EU countries have to implement within two years of this September. This specifically makes provision for museums, galleries, archives and libraries, educational establishments and public services broadcasters to make use of orphan works. These are all, essentially, cultural institutions and would fulfil entirely what the noble Baroness, Lady Warwick, desired in her speech earlier. It may not be a perfect directive at this stage but, if it will apply in 27 EU countries, we should surely be building on it, not building an alternative.
The Government’s proposals under Clause 68 go much further, by permitting exploitation for commercial purposes. This is a matter of real concern to many, particularly the creators of images where the metadata has been stripped and attribution lost. This is the reason why equivalent provisions failed to get through Parliament last time in the Digital Economy Bill.
Has no account been taken of the photographers’ strong concern, voiced during passage of the Digital Economy Bill and in the Hargreaves consultation? The impact assessment for these provisions sets out a ludicrous range of benefit to the economy of between £9 million and £91 million. This is hardly a credible business plan especially when, implausibly, it cites using genealogy as the example of where great commercial income might be made from the exploitation of commercial works. Furthermore, what will the “authorised body” under the proposals be? Is the copyright tribunal really suitable? What alternatives are being considered? Will it be the IPO itself? This could require an expensive infrastructure well beyond that envisaged in the European directive.
The second part of the clause deals with extended collective licensing. Without consulting a rights holder, an ECL agency would have the right to act on his or her behalf, agreeing commercial terms and financial compensation for the use of his or her content. ITN and many other news agencies such as Associated Press, Thomson Reuters, AFP, Press Association, Getty Images and DPA are deeply concerned about ECL. In their view, ECL removes the business logic for investing in digitisation and will starve the UK creative sector of valuable digital content. As Richard Hooper says in his second report, why proceed in this way when we have the digital copyright hub in the making? This is precisely what the copyright hub will do for non-orphan works. Is ECL not obviated except, perhaps, for orphan works, now that a more streamlined clearance system is being designed through the new copyright hub?
What is being proposed will, in effect, be compulsory for most people and organisations. Every creator of copyright-protected material outside the UK—and many English language creators are in other countries around the world, such as the USA, Australia, Canada and India—would need to keep themselves constantly updated about all the organisations which have been issued, and still retain, permits to operate ECLs within the UK and which might be licensing their works.
There is nothing in the impact assessment to quantify any benefits from ECL and there is no analysis of the losses that it would create. In any event, how on earth can the cost of administering the ECL be estimated at only £10,000 per annum, equating to 20% of the salary of two people on £25,000 per annum, as set out in the impact assessment? No countries operate ECL in the broad way envisaged by the Hargreaves report and the Intellectual Property Office. The use of ECL in Nordic countries is very specific and narrow. Rights holders, however, are generally very supportive of the broadcasters’ desire to open up their programme archives and appreciative of the administrative challenge that they face in doing so. That is precisely why they have been holding detailed meetings with the UK broadcasters in order to make their rights clearances both cheaper and more efficient.
The noble Baroness, Lady Buscombe, raised a number of questions about ECL. I can add others: how do we know what will make a collecting society sufficiently representative to operate ECL? What sums of money or percentages will be paid to copyright owners and what will be retained by the ECL organisations? What
will be the duration of licences? With a few minor exceptions, much more straightforward identification and licensing of rights is universally thought by creators and the creative industries to be the way forward, through the proposed copyright hub and not through extended collective licensing.
Finally, I have a general question for the Minister, arising out of paragraph 168 of the second Hooper report. As Richard Hooper asks, what are the Government doing to meet the challenge of reducing the incidence of copyright infringement on the web in return for the creative industries making licensing easier? There are several avenues to explore, such as improving site-blocking court procedure and tightening up on metadata stripping, which is at the root of so much concern among image rights-holders. Will the Government examine the whole issue of moral rights in the context of giving better protection to individual creators?
In conclusion, we have a very flimsy set of ill thought-through clauses here which risk confusion and litigation on a huge scale and risk the UK being shunned as a country to license to, produce in or license from. It is particularly sad that so little, if any, account seems to have been taken of the 471 responses to the Hargreaves consultation in framing the legislation. The clauses need a complete rethink. Will the Minister undertake to do so in Committee?
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