Clause 17 - Unified Patent Court

Intellectual Property Bill [Lords] – in a Public Bill Committee at 11:00 am on 28th January 2014.

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Question proposed, That the clause stand part of the Bill.

Photo of Dai Havard Dai Havard Labour, Merthyr Tydfil and Rhymney

Order. Before you continue, Mr Wishart, it seems that Mr Wright was under the impression that we were finishing at 11 am. The disappointing news for him is that we have until 11.25 am to get to clause 19.

Photo of Pete Wishart Pete Wishart Shadow SNP Spokesperson (Culture and Sport), Shadow SNP Spokesperson (Constitution)

I am always disappointed to disappoint the hon. Gentleman on these issues. As I was saying, Mr Havard, I welcome your chairmanship of this important Committee and look forward to spending the next couple of days discussing these important issues.

The Minister knows that I have big concerns about clause 17. We debated the matter on Second Reading and he gave me a degree of assurance that some of the issues I am about to present would be addressed. The matter was also discussed fully when the Bill went through Committee in the other place, again without any conclusion about how the clause would work.

Clause 17 makes provision to confer, remove or vary the jurisdiction of a court in relation to dealing with the new unified patent court, giving the ability of the new jurisdictions to look over European patents and for the opting-out of the new regime. I think we all support the creation of a new unified patent court; in fact, some of us have been arguing for it for a long time. However, there are big issues for Scotland, because it could prevent Scotland from looking at the whole issue of patents. For decades, if not centuries, the Edinburgh Court of Session has had the ability and power to look after patents in Scotland. Scotland is a distinct legal jurisdiction; we have our own Scots law. With the new unified patent court, we may lose that ability to rule on patents. The UK Government will become one of the direct patent courts: they will be in London, Paris and Munich—all we need is New York for the pop song. London, of course, will be able to get one of the new unified patent courts.

The UK as a member state has the opportunity to designate four other divisional courts. All we are asking of the Minister is to ensure that the Edinburgh Court of Session is included, so that we do not lose the centuries of experience of looking at Scots patents that we have built up in Scotland. If we do not do that, it will have a massive impact on Scots inventors and creators. Scotland practically invented the modern world—everything from tarmacadam to television, from Dolly the sheep to the Higgs bosun came from Scottish inventors or were made in Scotland—and here we are at the point of losing our ability to deal with patents, which would be patently absurd.

We have so many IP-rich businesses in Scotland and so many sectors, including life sciences, renewables, particularly in the oil and gas sector. We need the ability for patents to be heard in Scotland. I can only imagine the cost and inconvenience for Scottish businesses if they had to travel to other jurisdictions to seek satisfaction in the courts with regard to patents. That is an inconvenience that small businesses can ill afford.

I do not think the Government meant to exclude Scotland when considering the divisional courts of the unified patent court. I think that, as with most things to do with Scotland, the Government just did not think about it. That is the theme of Westminster rule when it comes to Scotland. If we were a sole member of the European Union—which we would be—we would be able to do this anyway. The Minister has an opportunity to contribute to the constitutional debate and put aside any fears for the entire legal establishment in Scotland. He will have seen the letters from the Law Society of Scotland and the Faculty of Advocates in Edinburgh. James Wolfe, vice-dean of the Faculty of Advocates said:

“A divisional court of the UPC should be established in Scotland. Failure to establish such a court in Scotland would disadvantage Scottish-based businesses, would lead to an erosion of expertise in Scotland and would have an adverse impact on the Scottish economy.”

The Minister has an opportunity to put this right and contribute to the constitutional debate in his inimical style. I hope the matter is resolved on the basis of the whole of the legal community of Scotland.

I did not have an opportunity to present my amendments—I was given only 24 hours’ notice that I was a member of this Committee—but I will revisit the matter during the remaining stages. The amendments are on the amendment paper and I hope I can move them at a later date. If we do not get clarity from the Minister, we will have to put the matter to the House. When it comes to these issues, we will do all we can to ensure that the Scottish legal system is properly represented and gets satisfaction.

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

I have a lot of sympathy with what the hon. Gentleman says. I have three broad questions about clause 17. As he said, the power set out in the clause confers jurisdiction or removes jurisdiction from a court, and the Secretary of State will be allowed to have that power. Before I ask my three questions, I have to say that getting the unified patent court is a coup in helping to ensure that we can remain the centre of excellence, certainly in Europe, when it comes to IP. I welcome that.

First, before the Secretary of State exercises the power, how will he consult with stakeholders? That is the purpose behind the hon. Gentleman’s amendment, which was not selected. Secondly, will one of those courts be in Scotland or any other part of the United Kingdom? There could be two courts: one in London and one somewhere else in the United Kingdom. On Second Reading I made a strong case for Hartlepool. I imagine that other hon. Members will want to press their own cases. Where else will that court be and how will the process be decided? My third question concerns a broad constitutional point—it also touches on the wider point about the integration and relationship of patents, designs and IP, and the relationship between UK domestic law, Scottish law and EU law. What happens to clause 17 in the event of independence? How will that work out and what will the Minister do? Those are my three concerns. I shall be interested to hear what the Minister has to say.

Photo of David Willetts David Willetts Minister of State (Universities and Science)

I welcome the speech by the hon. Member for Perth and North Perthshire. Like him, I regard the Scottish enlightenment as the intellectual origins of the modern world. At a time when Oxford and Cambridge were languishing, we looked to the universities of Edinburgh and Glasgow and thinkers such as Adam Smith and David Hume. I understand the points he makes about the excellence of Scotland’s intellectual and research life. To this day within the UK research budget, Scottish institutions—universities and research institutes—get more UK funding than Scotland would get as a percentage of UK GDP, because our sole criterion is excellence. If I remember correctly, Scotland generates about 8% of UK GDP and gets about 12% of the science and research budget, for which I am the responsible Minister, so when there is excellence, Scotland, as part of the UK, benefits from it, as we would expect.

The only point when the hon. Gentleman’s poetry about the Scottish intellectual life took him a bit too far was when he said that Professor Peter Higgs had invented the Higgs boson. I think he discovered it; indeed, he might interpret the suggestion that he invented it as a rather savage criticism. I had the privilege of being at the Nobel prize ceremony when this distinguished academic—born in England, educated at a secondary school in Bristol, but spending most of his career in Edinburgh—received his Nobel prize.

Let me clarify an important point. Although there is a separate Scottish legal tradition and separate Scottish law, there is not a separate Scottish body of patent law. We have a single UK framework in the area of intellectual property. As far as I am aware, not even the Scottish National party has suggested that there should be a separate body of Scottish law.

The clause enables the Government to give effect at a later date to the recently signed international agreement creating a unified patent court for Europe. Successive Governments in Britain have sought this unified patent court—which is part of a package of reforms of the European system—for a long time. I was grateful to the hon. Member for Hartlepool for acknowledging what an achievement that is. Having seen close up how tricky some of the negotiations were, I have to say that it was a testament to the personal negotiating skill of our Prime Minister that it was secured with a significant office in London—I do not mind being quoted on that.

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

I am sure that it would be helpful for the Minister to applaud the strong European credentials of the Prime Minister in achieving that to his Government’s Members. Does he agree?

Photo of Dai Havard Dai Havard Labour, Merthyr Tydfil and Rhymney

Do not be tempted too far, Mr Willetts.

Photo of David Willetts David Willetts Minister of State (Universities and Science)

It was certainly an example of what can be achieved with tough and effective negotiations in Europe: something that had not been achieved by previous Governments. We are doing this not because anyone in Europe is dictating to us, but because it is in the interests of business in Britain and across Europe to have a single EU patent regime instead of a fragmented system of 25 different regimes. Indeed, businesses will now have the choice of protecting their inventions in 25 EU countries with a single patent that they could defend in one court, instead of fighting their case in each European country. That will reduce the cost and administrative burden on businesses in need of Europe-wide protection. The clause, which is a key part of the Bill, will finally ensure that innovative businesses, which have been waiting for a single European patent system for more than 40 years, will be able to participate in that.

The concern of the hon. Member for Perth and North Perthshire is about where local divisional jurisdiction should function. It is not the case that the national  court of the host state has unified patent court jurisdiction conferred upon it. It may be possible for divisions of the unified patent court to share premises with national courts, but the unified patent court will be an international court with international legal personality, separate from the UK courts. The UK courts will, of course, still have jurisdiction over national patents.

As to where local divisions of the unified patent court should be set up, the hon. Member for Perth and North Perthshire was eloquent on that. Let me assure him and the Committee that there is close engagement between the UK Government and the devolved Administrations—including the Administration in Scotland—who are participating in the work of the taskforce responsible for UK implementation of the unified patent court agreement. I cannot say today whether there will be a local court in Edinburgh, but we are committed to ensuring that all areas of the UK will have access to the court. I understand the powerful historic arguments for one such court being based in Edinburgh. Each local court comes with a cost, and I presume that the devolved Administration would be willing to bear that if there were to be one in Edinburgh. They are expensive, as there is the cost of the court rooms, the administrative staff and so on.

One possibility—which it would be wrong to rule out at this stage—is a travelling assize model. It might be that the best way to make the court accessible to as many businesses as possible is to have a model where it sits in different locations as the need arises. One reason why I cannot go as far as the hon. Gentleman would like is that we need to consider that option carefully in the consultations, which include the devolved Administrations. I assure him, however, that we understand the need, where there are concentrations of businesses, for them to be able to access local courts. We will look sympathetically at any proposal for a court to be located in Scotland—we do not want them to be located away from the action—and we will continue to consult closely to try to ensure that we secure easy access to the new process across the UK, and certainly in Scotland.

Photo of Dai Havard Dai Havard Labour, Merthyr Tydfil and Rhymney

I should add that other devolved Administrations are available.

We heard it suggested that Mr Wishart’s amendment was not selected. Mr Turner and I had discussions with the Minister, and Mr Wishart agreed that it would not be taken this morning, but that other methods would be available to him. Certainly, he would have complied with clause 16, as there was no lack of novelty in his contribution.

Question put and agreed to.

Clause 17 accordingly ordered to stand part of the Bill.

Clauses 18 and 19 ordered to stand part of the Bill.

Schedule agreed to.

Ordered, That further consideration be now adjourned. —(Mr Gyimah.)

Adjourned till this day at Two o’clock.