My Lords, Amendments 10 and 11 in this group are intended to help refine the orphan works licensing scheme which the Government are rightly bringing in, to make it more fit for purpose.
I say at the outset, as much for the ears of officials as for noble Lords, that these amendments have been tabled entirely at my own instance. Those in various parts of the cultural sector with whom I have conferred on the whole question of orphan works over the weeks in which we have been examining this legislation would, I think, have preferred that I should not trouble your Lordships any further on these matters, trusting—as they wish to be able to do—that reason will prevail in the processes in Whitehall leading up to the regulations. However, I have thought it right to prevail for a few moments on the patience of your Lordships. This House is always a forum in which it is appropriate for us to consider policy decisions which, unintentionally of course, may damage the cultural life of this country. There are also principles here which, as parliamentarians, we ought to consider.
The term “orphan works”, as we know, denotes material such as books, letters, diaries, documentation from the voluntary sector, broadcasts and newspapers held in our great public collections which may still be in copyright but where the owners of the copyright cannot be identified—or, if they have been identified, cannot be found. Vast quantities of such orphan works are held in our public collections. They would be capable of expressing and illuminating our shared national heritage. They represent a resource of enormous potential value educationally, academically, culturally and economically. Without a well designed orphan works licensing system, it will remain impossible, as it is at the moment, to digitise this material and make it available to citizens and scholars for the public benefit.
All are agreed on two things. We need a workable orphan works licensing scheme that will make this material accessible; and, contrary to suggestions made by some campaigners, rights-holders ought to be paid for the use of their intellectual property, whether they are identified in the process of digital search or appear subsequently, if they request that they should be paid—although we anticipate that nearly all of them will not make the request. There is no question of anybody proposing to steal other people’s intellectual property. If an organisation wanted to do that, of course it should not be licensed. I certainly do not believe that our national cultural institutions wish to do any such thing.
Your Lordships made the decision, on Report, on a narrow majority, that it would be inappropriate to introduce a provision to provide for flexibility in respect of the requirement that fees should be paid up front for the licensing of orphan works. However, I must say to noble Lords that libraries, archives, museums, galleries and universities remain seriously worried about the decision that the House took last week. Of course, I accept that it was the will of the House, but these amendments seek to address entirely reasonable anxieties
about elements within the architecture of the Bill as the House has approved it. Nothing in my amendments would undo the principle of the legislation.
I also suggest to your Lordships that these are not political issues. When we have legislated on copyright over the years we have never done so in a partisan spirit. Some noble Lords may have taken part in the parliamentary proceedings on the Copyright, Designs and Patents Act 1988. I well remember that John Butcher, the Minister responsible for that legislation, conducted the parliamentary proceedings in the spirit of a seminar. I was the government Whip on the Bill. We do not normally conduct legislative proceedings in the spirit of a seminar, but we were seeking to elicit from everybody who participated in those proceedings the best contributions they could make towards achieving an appropriate balance and a policy that would protect the legitimate rights of individuals and corporate interests, while providing for the maximum public benefit. We debated in the same spirit the proposals on copyright much more recently during the passage of the Digital Economy Act 2010. Those debates were strenuous but fair-minded. We should continue, even at this very late stage of the Bill, to legislate in the same spirit.
Amendment 10 would provide that, after not more than three years, there should be a review of the progress of the orphan works licensing scheme. The review should include an impact assessment and a cost-benefit analysis. If we have such a review we will be in a position to know whether the anxieties that are now being expressed will have proved justified. The anxieties are principally about the model of diligent search that may be required, particularly if it is to be insisted that there should be a diligent search for each individual item for which a licence is sought, rather than a diligent search on a rigorous but more generic model.
There is a concern that this requirement and the requirement to lodge payments for the vast number of orphan works that we hope to digitise en masse would be burdensome. In particular, there is a fear that this would be an expensive additional cost, on top of the costs that must already be incurred in the process of digitisation. Universities UK, the Wellcome Trust and the British Library have all said, as the House knows, that if up-front payments are required, they anticipate that they will not, after all, feel it possible to embark on large-scale digitisation projects. If that proves to be the case, the Government’s very laudable policy will have bitten the dust.
If we have the review, it will enable us to know whether those who are now expressing those anxieties are right, and whether we, as parliamentarians, may have made a wrong decision. The material in the review —the impact assessment and cost-benefit analysis—would, of course, be extremely valuable in enabling Parliament to undertake post-legislative scrutiny, which is something that many of your Lordships feel is appropriate to be carried out by this House, and of which we should do more.
Amendment 11 would provide that after five years, royalties that had been paid up front to the licensing authority but remained unclaimed by rights-holders should be returned to the institutions that had deposited the funds with the licensing authority. On Report, the
Minister briefly discussed the question of what might happen to these funds in due course. He indicated that it is not the intention that the funds should remain indefinitely in the escrow account of the licensing authority for the eventuality that rights holders would turn up, but that after a period, which I understand to be five years:
“Unclaimed fees could be used to subsidise the cost of running the orphan works scheme”.
The Minister must be intending to bring in a mighty expensive quango, because there will be quite substantial funds in the account. Otherwise, he contemplated, the unclaimed fees could be used,
“to pay for preservation costs in public institutions or industry training. There will be further consideration of these options”.—[Official Report, 11/3/13; col. 49.]
Will the Minister explain why BIS should determine how these sums should be spent? The great cultural institutions, such as the national museums and galleries, and the British Library, are funded not by his department but by DCMS, which very rightly operates on an arm’s-length principle. It does not believe in telling these institutions how they should use their funds. This is, therefore, a question of principle. However, the most important principle is that these funds should not revert to the Exchequer. The Minister did not discuss that possibility. Although I raised it in my speech on Report, he did not refer to it in his wind-up. Of course, it was quite explicitly contemplated in the impact assessment last year.
If that were to be the case—if, after five years or after whatever interval, the money, instead of going back to the institutions that had deposited it, reverted to the Exchequer—that would, in effect, be double taxation. It would be a tax on funds that had already been provided by the taxpayer by way of grant, and otherwise it would be a levy on charitable funding, whether that is funding raised charitably by public institutions or by great charitable institutions such as the Wellcome Trust.
These institutions are—I repeat, and again emphasise —happy to pay rights-holders when they are found, and would of course remain happy to pay those rights holders even after the money had been returned to them by the licensing authority. They are happy to contribute to the reasonable administrative costs of the licensing authority. They are not happy to forfeit precious funds notionally for the benefit of rights-holders but in reality for the benefit of the Exchequer. I cannot imagine any justification for that.
To speak of competition in this particular context is, in any case, meaningless. Publically-funded institutions that are not for profit, but that hold collections and provide services for the public benefit, have different obligations and accountabilities, and face different costs from private institutions, operating for profit in the marketplace. You cannot reasonably make a comparison or invoke the principle of competition here.
If the Government were to confiscate funds that had been derived from public and charitable institutions we would be cutting off our nose to spite our face. I hope that the Minister will, in his response, definitively rule out any such intention on the part of the Government. I beg to move.
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