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New Clause 1 - Director General of Intellectual Property Rights

Intellectual Property Bill [Lords] – in a Public Bill Committee at 12:45 pm on 30th January 2014.

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‘(1) The Copyright, Designs and Patents Act 1988 is amended as follows:

(2) In Part VII (miscellaneous and general) at the beginning insert—

“295A Director General of Intellectual Property Rights

(1) The Secretary of State shall appoint an officer to be known as the Director General of Intellectual Property Rights (“the Director General”).

(2) The Director General has a duty to—

(a) promote the creation of new intellectual property,

(b) protect and promote the interests of UK intellectual property rights holders,

(c) co-ordinate effective enforcement of UK intellectual property rights, and

(d) educate consumers on the nature and value of intellectual property.

(3) In performing those duties, the Director General must also have regard to the desirability of—

(a) promoting the importance of intellectual property in the UK,

(b) encouraging investment and innovation in new UK intellectual property, and

(c) protecting intellectual property against infringement of rights.”.’.—(Mr Wright.)

Brought up, and read the First time.

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

I beg to move, That the clause be read a Second time.

The new clause stems from the fact that the UK needs a champion for intellectual property. IP matters, and it is growing in importance in the modern world. Things such as digitisation, open sourcing, the growth of intangible assets and investment in brands show that the world economy is changing and that the nature of economic value is altering. Assets, and the potential to derive revenue streams from those assets, are not just physical bricks and mortar or plant and machinery. That is why Twitter, with hardly any physical assets or content costs, is forecasting earnings before interest, taxes, depreciation and amortization of 30%, and why investors, rightly or wrongly, are prepared to value the company today—this morning, because I checked—at $62 a share. Twitter is now worth $33 billion.

Let us not get into the arguments about valuing tech or social media companies, but what I have described points to IP being a leading contributor to nations’ comparative advantage and future economic growth. The notion of how IP fits into and co-ordinates with other parts of Government policy and how that interacts with the wider private sector is important, yet IP is very often seen as a minor matter in Government. It does not help that responsibility is seen to be split between BIS and the Department for Culture, Media and Sport. It is welcome that the present Minister, Viscount Younger of Leckie, now at least has “intellectual property” in his title, although it is disappointing that the Prime Minister does not actually know who his IP Minister is.

It was said in the Culture, Media and Sport Committee’s report on creative industries that Google has more access to No. 10 than the IP Minister. To put Lord Younger’s exact words on the record, he said:

“Google is one of several search engines, and I am very aware of their power, put it that way. I am also very aware, I think, that they have access, for whatever reason, to higher levels than me in No. 10, I understand.”

In contrast, the United States now has an IP tsar—or, more accurately, the office of the US intellectual property enforcement co-ordinator, which is a great title—with a direct reporting link to the President. The office states on its website that it is

“dedicated to the protection of the American intellectual property that powers our economy. American entrepreneurs, business owners, and the general public are best served by an economy that fosters and protects our global competitive advantage, which must discourage intellectual property theft while protecting the constitutional rights of our citizens. Our office strives to make sure that the Federal government takes the most appropriate action to realize those goals.”

The website continues:

President Obama and Vice President Biden are acutely aware that intellectual property—the ideas behind inventions; the artistry that goes into books, music, and film; the valuable trade secrets that preserve a company’s market edge—is an integral part of the US economy. Infringement of intellectual property can damage our economy and undermine American jobs. Infringement shrinks markets and opportunity, hurts export prospects, threatens health and safety, and funds criminal syndicates around the world.”

The job of the IP tsar

“is to coordinate the work of the Federal government in order to stop illegal and damaging intellectual property theft.”

Therefore, my question to the Minister is: if the US—which is the most open, free market nation on earth and the champion of dynamic entrepreneurship and technological innovation—has such a role for protecting and championing IP, can we not have a similar role?

A year or so ago, the all-party parliamentary intellectual property group produced a report on the role of Government in promoting and protecting intellectual property. Several members of that group are also members of the Committee, and I hope they will be able to catch your eye, Mr Havard, so that they can discuss the report—it is a good report, with lots to commend in it. I was particularly taken by its recommendation for a strong IP champion. The report states:

“We are concerned that the IPO is not a champion of intellectual property and from their evidence, they do not see this as their role. This needs to be rethought. The US has clearly benefited from having an IP tsar, and whilst we wouldn’t necessarily want to go down that route, we do think the Minister needs to become a champion of IP. We would like to see a small unit within the IPO fulfilling that role or if they are unwilling to, a small team in BIS undertaking that function.”

We can discuss—as I hope we will—the merits of having a director general as an IP tsar, as the new clause proposes, or the Minister being its champion. The key point I want to stress with our new clause, however, is the need for an individual to promote, co-ordinate, educate and protect on all matters relating to IP.

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

On Second Reading, the hon. Gentleman, who has extremely good knowledge of IP, was pitching for the IP tsar role. I am happy to give way, for him to provide the Committee with his CV.

Photo of Mike Weatherley Mike Weatherley Conservative, Hove

I should clarify that I did not actually pitch for the role; I, among other notable people in the Chamber at that time who had equal qualifications—or perhaps even better—mentioned that perhaps we should consider that. The hon. Gentleman mentions the options, but he has not said who the director general would report to, whether the role would be necessary by law or whether someone could be appointed in any event. I am slightly concerned by that, so will he say why this measure needs to be enshrined in law and who the director general would report to? If it should be the IPO, will he say why?

I was part of the all-party parliamentary group that, as the hon. Gentleman said, was quite critical of the way the IPO was running. I would be worried if the director general was just another role within that. It needs to be outside, although I do not think we have enough time in discussing the Bill to debate the nuances of how that should come into force. I do, however, agree entirely with the principle of what the hon. Gentleman says. Will he answer those points?

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

The hon. Gentleman is being far too modest. His knowledge and experience make him an ideal candidate to be the IP tsar—I would have thought that the Prime Minister would want him for that role anyway, as his IP enforcer on the Back Benches. The hon. Gentleman makes an interesting point. Reporting lines are a matter that the Committee needs to consider. Should the line from the director general go to the permanent secretary, directly to the Secretary of State or, as in the US, directly to the Head of Government? That would be an interesting debate.

The point I want to make is this. Where is the champion and co-ordinator of IP across Government? At the moment, that is simply not happening and not  being given the consideration that it deserves. The purpose of the new clause—and, I think, the recommendation from the all-party parliamentary group—is to say that IP matters more than ever in the developing global economy and we are good at it, but we need to ensure that we maintain that competitive edge. One way we can do that is by having someone who champions it. At the moment, the Minister is not doing that. At the moment, this issue is seen as a secondary consideration.

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

I am not suggesting that the Minister is saying that, but the Minister in the Lords admitted that Google gets to see No. 10 far more than he does. This  matters and it needs to be considered. I therefore hope that the new clause will facilitate a discussion of the need to co-ordinate and champion IP across Government and the wider economy.

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

Mr Turner will chair this afternoon. My only declaration of interest is that I do not have substantial property and I am not normally regarded as an intellectual—so I have obviously been the right man to chair your Bill so far.

Ordered, That the debate be now adjourned.— (Mr Gyimah.)

Adjourned till this day at Two o’clock.