New Schedule 1

Enterprise and Regulatory Reform Bill – in a Public Bill Committee at 3:15 pm on 17 July 2012.

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Licensing of copyright and performers’ rights - ‘PART 1 - REGULATION OF LICENSING BODIES

1 In the Copyright, Designs and Patents Act 1988, before Schedule 1 insert—

“SCHEDULE A1 - REGULATION OF LICENSING BODIES

Codes of practice

1 (1) The Secretary of State may by regulations make provision for a licensing body to be required to adopt a code of practice that complies with criteria specified in the regulations.

(2) In relation to a licensing body that fails to adopt a code of practice that it is required to adopt under provision within sub-paragraph (1), the regulations may provide for a code of practice approved by the Secretary of State or by a person designated by the Secretary of State under the regulations to have effect as a code of practice adopted by the body.

2 Regulations under paragraph 1 may make provision as to conditions that are to be satisfied, and procedures that are to be followed—

(a) before a licensing body is required to adopt a code of practice as described in paragraph 1(1);

(b) before a code of practice has effect as one adopted by a licensing body as described in paragraph 1(2).

Licensing code ombudsman

3 (1) The Secretary of State may by regulations make provision—

(a) for the appointment of a person (the “licensing code ombudsman”) to investigate and determine disputes about a licensing body’s compliance with its code of practice;

(b) for the reference of disputes to the licensing code ombudsman;

(c) for the investigation and determination of a dispute so referred.

(2) Provision made under this paragraph may in particular include provision—

(a) about eligibility for appointment as the licensing code ombudsman;

(b) about the disputes to be referred to the licensing code ombudsman;

(c) requiring any person to provide information, documents or assistance to the licensing code ombudsman for the purposes of an investigation or determination;

(d) requiring a licensing body to comply with a determination of the licensing code ombudsman;

(e) about the payment of expenses and allowances to the licensing code ombudsman.

Code reviewer

4 (1) The Secretary of State may by regulations make provision—

(a) for the appointment by the Secretary of State of a person (the “code reviewer”) to review and report to the Secretary of State on—

(i) the codes of practice adopted by licensing bodies, and

(ii) compliance with the codes of practice;

(b) for the carrying out of a review and the making of a report by that person.

(2) The regulations must provide for the Secretary of State, before appointing a person as the code reviewer, to consult  persons whom the Secretary of State considers represent the interests of licensing bodies, licensees, members of licensing bodies, and the Intellectual Property Office.

(3) The regulations may, in particular, make provision—

(a) requiring any person to provide information, documents or assistance to the code reviewer for the purposes of a review or report;

(b) about the payment of expenses and allowances to the code reviewer.

(4) In this paragraph “member”, in relation to a licensing body, means a person on whose behalf the body is authorised to negotiate or grant licences.

Sanctions

5 (1) The Secretary of State may by regulations provide for the consequences of a failure by a licensing body to comply with—

(a) a requirement to adopt a code of practice under provision within paragraph 1(1);

(b) a code of practice that has been adopted by the body in accordance with a requirement under provision within paragraph 1(1), or that has effect as one adopted by the body under provision within paragraph 1(2);

(c) a requirement imposed on the body under any other provision made under this Schedule;

(d) an authorisation under regulations under section 116A or 116B;

(e) a requirement imposed by regulations under section 116A or 116B;

(f) an authorisation under regulations under paragraph 1A or 1B of Schedule 2A;

(g) a requirement imposed by regulations under paragraph 1A or 1B of that Schedule.

(2) The regulations may in particular provide for—

(a) the imposition of financial penalties or other sanctions;

(b) the imposition of sanctions on a director, manager or similar officer of a licensing body or, where the body’s affairs are managed by its members, on a member.

(3) The regulations may include provision—

(a) for determining whether there has been a failure to comply with a requirement or code of practice for the purposes of sub-paragraph (1);

(b) for determining any sanction that may be imposed in respect of the failure to comply;

(c) for an appeal against the imposition of any such sanction.

(4) A financial penalty imposed under sub-paragraph (2) must not be greater than £50,000.

(5) The regulations may provide for a determination within subparagraph (3)(a) or (3)(b) to be made by the Secretary of State or by a person designated by the Secretary of State under the regulations.

(6) The regulations may make provision for requiring a person to give the person by whom a determination within sub-paragraph (3)(a) falls to be made (the “adjudicator”) any information that the adjudicator reasonably requires for the purpose of making that determination.

Fees

6 (1) The Secretary of State may by regulations require a licensing body to which regulations under any other paragraph of this Schedule apply to pay fees to the Secretary of State.

(2) The aggregate amount of fees payable under the regulations must not be more than the cost to the Secretary of State of administering the operation of regulations under this Schedule.

General

7 (1) The power to make regulations under this Schedule includes in particular power—

(a) to make incidental, supplementary or consequential provision, including provision extending or restricting the jurisdiction of the Copyright Tribunal or conferring powers on it;

(b) to make provision for bodies of a particular description, or carrying out activities of a particular description, not to be treated as licensing bodies for the purposes of requirements imposed under regulations under this Schedule;

(c) to make provision that applies only in respect of licensing bodies of a particular description, or only in respect of activities of a particular description;

(d) otherwise to make different provision for different purposes.

(2) Regulations under a paragraph of this Schedule may amend this Part or Part 2, or any other enactment or subordinate legislation passed or made before the paragraph in question comes into force, for the purpose of making consequential provision or extending or restricting the jurisdiction of the Copyright Tribunal or conferring powers on it.

(3) Regulations may impose requirements by reference to guidance issued from time to time by any person.

(4) The power to make regulations is exercisable by statutory instrument.

(5) A statutory instrument containing regulations that amend an enactment may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.

(6) Any other statutory instrument containing regulations is subject to annulment in pursuance of a resolution of either House of Parliament.

8 References in this Schedule to a licensing body are to a body that is a licensing body for the purposes of this Chapter or for the purposes of Chapter 2 of Part 2, and references to licensees are to be construed accordingly.”

Part 2 - Performers’ Rights

1 Schedule 2A to the Copyright, Designs and Patents Act 1988 (licensing of performers’ property rights) is amended as follows.

2 In the heading of the Schedule omit “property”.

3 In paragraph 1, after sub-paragraph (4) insert—

“(5) Schedule A1 confers powers to provide for the regulation of licensing bodies.”

4 After paragraph 1 insert—

“Orphan rights licensing and extended collective licensing

1A (1) The Secretary of State may by regulations provide for the grant of licences to do, or authorise the doing of, acts to which section 182, 182A, 182B, 182C, 182CA, 183 or 184 applies in respect of a performance, where—

(a) the performer’s consent would otherwise be required under that section, but

(b) the right to authorise or prohibit the act qualifies as an orphan right under the regulations.

(2) The regulations may—

(a) specify a person or a description of persons authorised to grant licences, or

(b) provide for a person designated in the regulations to specify a person or a description of persons authorised to grant licences.

(3) The regulations must provide that, for a right to qualify as an orphan right, it is a requirement that the owner of the right has not been found after a diligent search made in accordance with the regulations.

(4) The regulations must provide for any licence—

(a) to have effect as if granted by the missing owner;

(b) not to give exclusive rights;

(c) not to be granted to a person authorised to grant licences.

(5) The regulations may apply in a case where it is not known whether a performer’s right subsists, and references to a right, to a missing owner and to an interest of a missing owner are to be read as including references to a supposed right, owner or interest.

1B (1) The Secretary of State may by regulations provide for a licensing body that applies to the Secretary of State under the regulations to be authorised to grant licences to do, or authorise the doing of, acts to which section 182, 182A, 182B, 182C, 182CA, 183 or 184 applies in respect of a performance, where the right to authorise or prohibit the act is not owned by the body or a person on whose behalf the body acts.

(2) An authorisation must specify the acts to which any of those sections applies that the licensing body is authorised to license.

(3) The regulations must provide for the rights owner to have a right to limit or exclude the grant of licences by virtue of the regulations.

(4) The regulations must provide for any licence not to give exclusive rights.

1C (1) This paragraph and paragraph 1D apply to regulations under paragraphs 1A and 1B.

(2) The regulations may provide for a body to be or remain authorised to grant licences only if specified requirements are met, and for a question whether they are met to be determined by a person, and in a manner, specified in the regulations.

(3) The regulations may specify other matters to be taken into account in any decision to be made under the regulations as to whether to authorise a person to grant licences.

(4) The regulations must provide for the treatment of any royalties or other sums paid in respect of a licence, including—

(a) the deduction of administrative costs;

(b) the period for which sums must be held;

(c) the treatment of sums after that period (as bona vacantia or otherwise).

(5) The regulations must provide for circumstances in which an authorisation to grant licences may be withdrawn, and for determining the rights and obligations of any person if an authorisation is withdrawn.

(6) The regulations may include other provision for the purposes of authorisation and licensing, including in particular provision—

(a) for determining the rights and obligations of any person if a right ceases to qualify as an orphan right (or ceases to qualify by reference to any rights owner), or if a rights owner exercises the right referred to in paragraph 1B(3), while a licence is in force;

(b) about maintenance of registers and access to them;

(c) permitting the use of a work for incidental purposes including an application or search;

(d) for a right conferred by section 205C to be treated as having been asserted under section 205D;

(e) for the payment of fees to cover administrative expenses.

1D (1) The power to make regulations includes power—

(a) to make incidental, supplementary or consequential provision, including provision extending or restricting the jurisdiction of the Copyright Tribunal or conferring powers on it;

(b) to make transitional, transitory or saving provision;

(c) to make different provision for different purposes.

(2) Regulations under any provision may amend this Part, or any other enactment or subordinate legislation passed or made before that provision comes into force, for the purpose of making consequential provision or extending or restricting the jurisdiction of the Copyright Tribunal or conferring powers on it.

(3) Regulations may make provision by reference to guidance issued from time to time by any person.

(4) The power to make regulations is exercisable by statutory instrument.

(5) A statutory instrument containing regulations that amend an enactment may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.

(6) Any other statutory instrument containing regulations is subject to annulment in pursuance of a resolution of either House of Parliament.”

5 In section 205A of the Copyright, Designs and Patents Act 1988, and in the italic heading before that section (licensing of performers’ property rights), omit “property”.’.—(Norman Lamb.)

Brought up, read the First and Second time, and added to the Bill.

Question proposed, That the Chair do report the Bill, as amended, to the House.

Photo of Iain Wright Iain Wright Shadow Minister (Business, Innovation and Skills)

May I thank you for your wise and open chairmanship during today’s deliberations and the rest of the Committee’s sittings, Mr Bayley? Through you, I also want to thank Mr Brady for his high-quality, often even punctual, chairing of the Committee, and Mr Caton, who inadvertently stepped magnificently into the role for one session after you could take no more of my ramblings about competition in the bus industry. The Committee has been serious about the need to scrutinise an important Bill and about the manner of its deliberations and questioning, but it has done so in a good-natured and even comradely fashion. The tone and spirit of a Committee is set by the Chairs, Mr Bayley, and its members’ good nature and dedication to work has reflected the exemplary way in which you and Mr Brady have chaired us. I thank you for that.

I want to thank the Clerks, Mr James Rhys and Mr Steven Mark, who were enormously helpful, supportive and patient when I wanted to table incoherent and often contradictory—and possibly illegal—amendments. I would also like to thank the Doorkeepers, Hansard and the officials, who have worked hard and who I will be proud to have as my officials in a matter of months.

My hon. Friends the Members for Edinburgh South and for Newcastle upon Tyne Central have been formidable Front Benchers, ensuring that they will undoubtedly move from being shadow Ministers to actual Ministers in only a matter of time. They have scrutinised the Bill and questioned Ministers in a thoughtful, determined and even ingenious manner. My hon. Friend the Member for Edinburgh South is already having withdrawal symptoms from the Minister’s book, having had to return it to the House of Commons Library.

May I thank the Government Whip and the Opposition Whip, who have ensured that the Committee ran smoothly and effectively? I would have liked to think that the Government Whip spent the weekend preparing for the final stages of the Bill, using his parliamentary management to ensure that all Government new clauses and new schedules were added, but a quick look at his website shows that he was in the pub—opening the Merrie Lion  in Fenny Compton and having a great time. We resent not being invited and not being there, and the Government Whip should therefore buy the first round of drinks after this sitting.

My hon. Friend the Opposition Whip is a strong supporter of manufacturing in his constituency, and particularly caravan manufacturers such as Fifth Wheel. I know that the two Whips are planning a caravanning holiday for next week, with the caravan stacked full of pasties and copies of “Fifty Shades of Grey”—as well as the Minister’s book—for a lively, nay debauched, weekend in Rhyl. I also thank my hon. Friends the Members for Blaydon, for Rochdale, for Leyton and Wanstead, for East Lothian and for Swansea West for their dedication and commitment in challenging the Government and using their wide experience to try to improve this rag-bag Bill.

The hon. Member for Skipton and Ripon has made the Committee entertaining and provocative, and I welcome him back for this afternoon’s session after his attendance at a branch meeting of a trade union of which I know he is shop steward. It has been a pleasure to work with all the Government Back Benchers, particularly the hon. Member for Newton Abbot, who I understand is not here today because she is in court charged with grievous bodily harm—of the Prime Minister, I think, last week.

The Minister of State started off as an iron fist in a velvet glove, and never deviated from that stance, albeit in his usual courteous way. He failed to inform the Committee that the day after Second Reading he turned 50. The Opposition wish him a happy half century. We would have thought that he would have mellowed in his advancing years, but that has not been the case.

Finally, I turn to the Under-Secretary of State. I have to confess that I did not really know him before the Committee, but with each session his charm, professionalism and good nature have become increasingly apparent, and I have become increasingly impressed with those characteristics. I particularly liked the way he understood perfectly the nature of our amendments, had some sympathy with them, and then resolutely failed to move his position. It is a tribute to his courtesy and his friendliness, and that of his private office, that on the day after I mentioned in Committee my concern about insolvency legislation, stretching our deliberation of schedule 17 part 3 to breaking point, his private office contacted me, asking when I would like a meeting about the matter. I am very grateful to him and his office for that.

This side of the Committee has felt that we have had to support the Minister when he has risen to his feet, because his own side has failed to do so, but the situation is even worse within the ministerial team. In the other place on 12 July, in response to a question from Baroness Bakewell on copyright legislation, Baroness Wilcox, the Under-Secretary of State, stated:

“In the other place at the moment,”— in our own House—

“my honourable friend Norman Lamb is struggling with Clause 56, trying to clarify it and explain to people that they are worrying unnecessarily…By the time the Bill gets here, I am absolutely sure that things will be clear.”—[Official Report, House of Lords, 12 July 2012; Vol. 738, c. 1247.]

That is not the most ringing of endorsements or the best show of ministerial collective responsibility and support I have seen.

Last week in Committee I claimed that the Minister’s book was something like 480,000th in the Amazon list of bestsellers. I said that without having any empirical evidence—very much like the Government’s proposals in the Bill—so I might have misled the Committee. To make amends, I went on Amazon at the weekend, and the Minister will be pleased to hear that his book is 1,879,043rd.

Photo of Iain Wright Iain Wright Shadow Minister (Business, Innovation and Skills)

It sounds more like a figure for directors’ remuneration than a placing in a bestsellers list, but the Minister might take more comfort from the fact that Paul Simon’s “Graceland” is currently at No. 8 in the album charts. A review of the Minister’s book on Amazon—the only review in fact—

Photo of Iain Wright Iain Wright Shadow Minister (Business, Innovation and Skills)

It is entitled “Dated but not bettered”, and I cannot think of a better tribute to him.

The Enterprise and Regulatory Reform Bill is still, after 15 sittings, a ragbag Bill. It contains some things with which we agree but also missed opportunities, half-baked and ill thought-through ideas, and policy proposals dusted off the Whitehall shelf. The Bill’s scope to play a part in ushering in a new, innovative, better-balanced, fairer and more competitive era for the British economy has been missed, and it is needed more than ever, given that yesterday the IMF downgraded its forecast for UK growth in 2012 by a greater degree than for any other developed nation, to only 0.2%.

The Opposition have tried to ensure that the Bill fulfils its potential, through reasoning, questioning and scrutiny, and it is a shame that the Government have not listened. However, despite our intense disappointment, I give my thanks to all Members. It has been a pleasure and a privilege to serve on the Committee, and I wish you, Mr Bayley, and other Members here, a very happy, relaxing and enterprising summer.

Photo of Norman Lamb Norman Lamb The Parliamentary Under-Secretary of State for Business, Innovation and Skills 3:30, 17 July 2012

Thank you, Mr Bayley. I thank the shadow Minister, the hon. Member for Hartlepool, for his generous remarks, and I share his reflections on how the Committee has conducted itself. This has been my first Bill as a Minister and it has been quite an experience. I have enjoyed it and have appreciated enormously the way in which both Government and Opposition Members have gone about the debate in a civilized and serious way, while at the same time managing to enjoy some good humour along the way.

I am sure we all agree that the Bill has been thoroughly scrutinised by the Committee. I am pleased that we have completed proceedings in the time allotted—in fact, we have time to spare. I thank Committee members for the constructive way in which they have engaged in the debate. Special thanks must be given to my hon. Friend the Member for Skipton and Ripon for his incisive and  regular interventions, which have kept Opposition Members on their toes and which, at times, have kept us all amused. I am most grateful to him for his contribution. I also give special thanks to my hon. Friend the Minister of State for his work on various elements of the Bill. His contribution is enormously appreciated. I thank the Opposition’s Front-Bench representatives for the way in which they have gone about their task of scrutinising the Bill. Their approach has been appreciated.

We have had robust and well-informed consideration of every part of the Bill and the debate has been admirably steered under the excellent stewardship of Mr Bayley and his colleagues in the Chair. I am most grateful to them for their guidance throughout our deliberations.

I also pay tribute to the usual channels for their help and guidance throughout. I have learned an awful lot over the course of the Committee. The process has worked very well and we have avoided having to sit late. People have been sensible about the time taken for debate, and that has been very much appreciated.

Finally, but not least, I should like to recognise the hard work of Hansard in recording everything so accurately. I also thank the Clerks for their advice throughout and for their remarkable capacity to speak very fast, when the need arose, when giving the titles of various new clauses. That was appreciated and enjoyed by all. I also thank the Doorkeepers for keeping good order.

I also thank the officials in the Department for Business, Innovation and Skills for their extraordinary work in supporting both myself and my hon. Friend the Minister of State. I have been genuinely amazed by the quality of the advice that I have received throughout the Committee sittings and, indeed, beforehand when getting to grips with some complex stuff over the short period following my appointment. The work of civil servants does not often get appreciated, but it is enormously appreciated by everyone present, so I thank them and my private office staff for their work.

Photo of Ian Murray Ian Murray Shadow Minister (Business, Innovation and Skills)

I do not want to detain the Committee, but my hon. Friend, the former Minister, former accountant and current Member for Hartlepool mentioned the Minister’s book. I have a confession to make, because I have misled the House on the book. We have rightly used the Minister’s wonderful book at great length in this Committee, so it is only fair, given the vast number of Opposition amendments that the Government have accepted, that we return that generosity. Every Opposition member of the Committee has, therefore, signed the Minister’s book for him, not just to increase its value, but to get it into the top million bestsellers of all time. I will reflect briefly on one of the comments made by a colleague, who will remain anonymous. My hon. Friend the Member for Blaydon—[ Laughter ]—has written on the book’s cover:

“Norman, I haven’t read it either. I hope it is as accurate as the focus usually is.”

That is a direct correlation to a Liberal Democrat leaflet.

As I have said, I have misled the House, because the book in my possession, which has been amusing us throughout the Committee, is not actually by the Minister—I have only his book’s cover. This book is “Unusually Cricket” by the right hon. Member for Saffron Walden (Sir Alan Haselhurst). We had to return the original book to the university of Liverpool.

Photo of Ian Murray Ian Murray Shadow Minister (Business, Innovation and Skills)

That is only the cover. The Minister’s book has created a bit of friction, but as my hon. Friend the Member for Hartlepool hinted, it has not created any eroticism. Therefore, instead of presenting him with the book by the right hon. Member for Saffron Walden, we will present him with the cover of his “Remedies in the Employment Tribunal” book, signed by everyone on this side of the House, and to make it a little better, we thought we would get a copy of “Fifty Shades of Grey” and use his cover as the dust cover. We give it to the Minister with our gratitude for all his kind remarks, and his unstinting sympathy for our amendments. We look forward, on record, to getting a strong review of the book on Report after he has read it over the summer.

Photo of Norman Lamb Norman Lamb The Parliamentary Under-Secretary of State for Business, Innovation and Skills

May I express enormous appreciation for the kind gift? I will certainly keep that cover well over it. I just wanted to ask whether the university of Liverpool was aware that the cover of its book had gone missing. [ Interruption. ] Oh, the cover has been photocopied. That comes as an enormous relief. Thank you very much.

Photo of Hugh Bayley Hugh Bayley NATO Parliamentary Assembly UK Delegation

I would like to say what an enormous pleasure it has been to serve with you on the Bill. The debate has been good-natured and well-informed, even on the occasions when we discussed the Bill itself. I would like to pay tribute to all members of the Committee and, as the Front-Bench teams on either side of the Committee have, to all the servants of the House and civil servants who have helped get the Bill so effectively through this stage of its proceedings.

Photo of Norman Lamb Norman Lamb The Parliamentary Under-Secretary of State for Business, Innovation and Skills

On a point of order, Mr Bayley. I am extremely concerned, because my officials have just pointed out to me that in photocopying the cover of my book, the hon. Member for Edinburgh South appears to have breached my copyright.

Photo of Hugh Bayley Hugh Bayley NATO Parliamentary Assembly UK Delegation

Not just that, but if the Bill makes further progress, the copyright period will extend yet further. On that note, I shall put the final question to the Committee.

Question put and agreed to.

Bill, as amended, accordingly to be reported.

Committee rose.