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The Copyright, Etc. And Trade Marks (Offences And Enforcement) Bill

These notes refer to the The Copyright, etc. and Trade Marks (Offences and Enforcement) Bill as introduced in the House of Commons on 18 July 2001 [Bill 17] THE COPYRIGHT, ETC. AND TRADE MARKS (OFFENCES AND ENFORCEMENT) BILL EXPLANATORY NOTES INTRODUCTION 1.     These explanatory notes relate to the Copyright, etc. and Trade Marks (Offences and Enforcement) Bill as introduced into the House of Commons on 18 July 2001. They have been provided by the Department of Trade and Industry with the consent of Dr Vincent Cable, the Member in charge of the Bill, in order to assist the reader of the Bill and to help inform debate on it. 2.     These notes need to be read in conjunction with the Bill. They are not, and are not meant to be, a comprehensive description of the Bill. So where a clause or part of a clause does not seem to require any explanation or comment, none is given. SUMMARY 3.     This Bill amends the criminal provisions in intellectual property law, more specifically the law relating to copyright, rights in performances, fraudulent reception of conditional access transmissions by use of unauthorised decoders and trade marks. The Bill brings about some rationalisation of these criminal provisions by removing some of the differences. The three areas in which rationalisation is provided by the Bill are maximum penalties for certain offences in intellectual property law, police search and seizure powers relating to offences and court orders on forfeiture of illegal material that may have been seized during investigation of offences. The Bill does not make any changes to the scope of criminal offences in intellectual property law so that the type of behaviour that can give rise to an offence remains the same. BACKGROUND 4.     In general, intellectual property laws give private rights that can be enforced by the owners of the rights using civil remedies. In addition, criminal offences have been provided in relation to the making for sale or hire or dealing with the following types of illegal material: Copies of material that is protected by copyright, such as music, films and computer software, that have been made without the authorisation of the copyright owner, ie infringing or pirate copies, and articles that are specifically designed or adapted for making infringing copies of copyright material. —     See the offences in section 107(1) and (2) in Part I of the Copyright, Designs and Patents Act 1988. Copies of recordings of performances that have been made without the authorisation of the performer(s) or a person having recording rights in the performance, ie illicit or bootleg recordings. —     See the offences in section 198(1) in Part II of the Copyright, Designs and Patents Act 1988. Devices or other apparatus, including software, that allow people to access encrypted transmissions without paying the normal fee for their reception, ie unauthorised decoders for conditional access transmissions where the transmissions can be either broadcasts, including satellite broadcasts, cable programme services or information society services. —     See the offences in section 297A in Part VII of the Copyright, Designs and Patents Act 1988. Goods, packaging or labels bearing a trade mark that has been applied without the consent of the trade mark owner, ie counterfeit goods, and articles that are specifically designed or adapted for making unauthorised copies of a trade mark for use on such goods and other material. —     See the offences in section 92 of the Trade Marks Act 1994. It is these criminal provisions that are amended by the Bill. 5.     There is considerable overlap between the offences relating to the different material indicated above (and other criminal offences such as those in trade descriptions law and law relating to fraud) in that offending behaviour invariably falls within the scope of more than one offence. Also, some of the differences between the criminal provisions in these four areas in intellectual property law do not have a basis in the precise nature of the offence. The effect of the Bill is to remove some of the differences that are not dictated by the nature of the offence by copying certain of the existing criminal provisions in one or more, but not all four, of these areas of intellectual property law into the other areas. COMMENTARY ON CLAUSES Clause 1 6.     This clause raises the maximum penalty for conviction on indictment for the offences referred to in sections 107(4), 198(5) and 297A(2) in Parts I, II and VII of the Copyright, Designs and Patents Act 1988, relating to those making for sale or hire or dealing in material infringing copyright, illicit recordings infringing performers' rights and unauthorised decoders for conditional access services respectively. The new maximum penalty is an unlimited fine and/or up to 10 years in prison to reflect the seriousness of these crimes and to bring the penalties into line with the existing ones for similar trade marks offences. In addition, and for the same reason of consistency, this clause also adds the option of six months in prison to the penalty for summary conviction in section 297A(2). Clauses 2 and 6 7.     Clause 2 applies the existing provisions in section 109 of Part I of the Copyright, Designs and Patents Act 1988 allowing the police to obtain search warrants to all the offences in section 107(1) and (2), including those only triable in the magistrates' courts. The equivalent provision in section 200 of Part II of the 1988 Act is applied to all the offences in section 198(1) by this clause. Equivalent search warrant provisions are introduced by clause 2 for the offences in section 297A of Part VII of the 1988 Act. 8.     These provisions are in addition to any powers available to the police as a result of the Police and Criminal Evidence Act 1984 (PACE), but should ensure that there are no impediments to a full investigation of offending behaviour in the areas indicated which could still remain if PACE alone were to apply. The existing search warrant provisions in sections 109 and 200 allow a justice of the peace (or in Scotland, a sheriff or justice of the peace) to grant a warrant where information/evidence on oath leaves him satisfied that there are reasonable grounds for believing that an offence has been or is about to be committed and there is evidence of this on the premises. 9.     Powers of seizure of evidence that an offence has been or is about to be committed that are provided in section 109(4) where a warrant obtained under that section is executed are also introduced by clause 2 into section 200 and the new search warrant provision relating to the offences in section 297A. 10.     Clause 6 introduces search warrant and seizure provisions corresponding to those that are introduced or amended by clause 2 for Parts I, II and VII of the Copyright, Designs and Patents Act 1988 for the offences in section 92 of the Trade Marks Act 1994 relating to counterfeit goods and articles for making them. Clauses 3, 4 and 5 11.     Clause 3 reproduces in Part I of the Copyright, Designs and Patents Act 1988 provisions corresponding to those in sections 97 and 98 of the Trade Marks Act 1994, allowing forfeiture of infringing goods, specifically to apply in respect of goods infringing copyright, ie infringing copies, and articles specifically designed or adapted for making such copies. Section 97 relates to forfeiture in England, Wales and Northern Ireland and section 98 is a modified version relating to forfeiture in Scotland. 12.     The existing forfeiture provisions in trade marks law apply in England, Wales and Northern Ireland where items have come into the possession of a person in connection with the investigation or prosecution of one of the offences, or a related offence under the Trade Descriptions Act 1968, or any offence involving dishonesty or deception. They allow a court to order forfeiture of infringing goods both where a person has been prosecuted for an offence and where there is no prosecution, although in both cases the court must be satisfied that an offence has been committed in relation to the goods. In Scotland, the forfeiture provisions apply where a person has been convicted of one of these offences or on application by the procurator-fiscal. The court can order destruction of goods or release to another person with conditions. Broadly similar provision is introduced by Clause 3 into Part I of the 1988 Act. 13.     Clause 4 introduces forfeiture provisions, very similar to those in Clause 3, into Part II of the Copyright, Designs and Patents Act in respect of goods that infringe rights in performances, ie illicit recordings. 14.     Clause 5 introduces forfeiture provisions, very similar to those in Clause 3, into Part VII of the Copyright, Designs and Patents Act in respect of devices that permit fraudulent reception of conditional access transmissions, ie unauthorised decoders used to access transmissions such as satellite television without payment. FINANCIAL EFFECTS OF THE BILL 15.     The rationalisations of the existing criminal provisions in intellectual property laws resulting from the Bill will remove any loopholes in the areas amended and make enforcement action more straightforward and, therefore, more effective without any additional public expenditure. The greater clarity and transparency of procedures should even lead to some cost savings over the existing situation. Illegal activity in the areas that will be affected by the Bill may often currently be tackled under a range of existing laws, but the provisions in the Bill will allow more efficient enforcement action using search and seizure powers and penalties that are directed at the core of the wrongdoing. Allowing enforcers who have seized illegal material during an investigation to seek its forfeiture in all cases in the same court in which a prosecution occurs will save time currently spent ensuring that only goods with an unauthorised trade mark are subject to the order. EFFECTS OF THE BILL ON PUBLIC SERVICE MANPOWER 16.     Additional enforcement effort by public sector enforcers is not a necessary consequence of the provisions in the Bill so increases in manpower are not anticipated. Marginal savings in manpower might even result if, as a result of the Bill's provisions, enforcers are able to tackle offending behaviour more directly rather than trying to find alternative existing provisions that could be applied. Cuts in manpower are not planned though, as the expectation is that any savings as a result of the Bill will be directed into additional enforcement effort. SUMMARY OF THE REGULATORY APPRAISAL 17.     The Regulatory Impact Assessment identifies two other complementary options to pursue in addition to the legislative option delivered by this Bill, ie educating the public not to buy fake goods and improving the co-ordination of enforcement effort between all public and private sector enforcers. Some work in these areas has already been undertaken. Benefits for business and consumers are identified as the result of all three options. Practically all business sectors can be adversely affected by intellectual property crime (current industry estimates are losses of £8 billion per annum), but the legislative option results in no additional burden or costs on legitimate businesses. It is rogue traders, ie criminals, who are affected. Businesses already incur costs in respect of the other two options through choice because of the benefit to them, but additional costs are not expected. Additional costs to the public sector are not expected except with respect to consumer awareness where some expenditure has already been committed. Respondents to the consultative exercise in Spring 2000 broadly welcomed the legislative changes. 18.     The Department of Trade and Industry (DTI) will place a Regulatory Impact Assessment in the libraries of both Houses of Parliament. Copies of this will also be available from the Patent Office, an executive agency of the DTI, (telephone 020 7596 6513) Copyright Directorate, Harmsworth House, 13-15 Bouverie Street, London EC4Y 8DP. COMMENCEMENT 19.     Clause 7 provides for the provisions of the Bill to be brought into force by a commencement order. It is envisaged that this will occur about 12 weeks after the Bill receives Royal Assent to allow the Government time to disseminate information about the effects of the Bill, particularly amongst public sector enforcers.