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Mr. Sutcliffe: I beg to move, That the Bill be read the Third time.

I am grateful to hon. Members for their contributions on Report, especially the right hon. Member for North-East Hampshire (Mr. Arbuthnot), who was the architect of the thought pattern behind our second amendment. I thank him for that.

Our debates on the Bill have been interesting and well argued. On Second Reading, some reservations were expressed about the Bill, but it is fair to say that it was, by and large, welcomed on both sides of the House and I am pleased that hon. Members on both sides of the House have examined it in a constructive and detailed manner, both in Committee and again today. I thank them for that.

I shall make a few remarks before I commend the Bill to the House. The Government fully understand the importance of giving support to innovative and creative UK businesses. The patents system is one important way in which that support is provided and the Bill will help to ensure that our patents system is robust in its operation, while also being well-balanced and accessible to all. We are committed both to ensuring that protection continues to be available for those businesses that have the creativity and drive to make technical advances that help us all and to improving and modernising the patents system so that it meets the needs of its users.

As hon. Members know, the Bill brings our law into line with the revised European patent convention. I am, of course, pleased that it has been broadly welcomed for doing so, as there are significant advantages for UK businesses. The House will be aware that the Bill also makes some changes which, we believe, will help in the difficult area of the enforcement of patent rights.

As I said on Second Reading, we are much more alive to the concerns expressed by patent holders, especially patent holders in small and medium-sized enterprises,
 
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about the costs and time associated with patent litigation. In that debate and in Committee, we heard the view that the enforcement measures in the Bill do not go far enough to address those problems, especially in helping SMEs.

We believe that the changes we are making will certainly help all types of business, in particular SMEs, to resolve disputes over patents. We debated in detail clauses 12 and 13—two of the important ways in which the Bill will amend existing patents legislation, to help with the resolution of patent disputes.

I promised to consider the careful analysis made in Committee by the right hon. Member for North-East Hampshire of the relationship between clause 12, the Brussels regulation and proceedings for declaration of non-infringement. It is fair to say that although his analysis is, in essence, correct, his proposed solution would, in our view, undermine the delicate balance provided by the threats provisions—merely to circumvent the way in which the Brussels regulation applies in respect of proceedings for declaration of non-infringement. We should accept the operation of that regulation, and its effect on businesses operating in a global market.

The Bill is but one of the ways in which we are trying to improve patent enforcement. We realise that we cannot be complacent about the enforcement of intellectual property rights. Some new initiatives are being explored, and possible ways of addressing certain difficulties are being considered. We will continue to explore other possible ways to help patent holders enforce their rights, and to help patent holders and third parties resolve disputes over patents.

That exploration will not end simply because the Bill may be nearing the completion of its parliamentary journey—far from it. For example, there is our continued work on the patent enforcement project, and the results of the Patent Office-led study into that project will, as I indicated in earlier debates, be available shortly. We will no doubt look carefully at those results and how best to take them forward. To give another example: we have already said, during deliberations on the Bill in another place, that we will monitor the ongoing improvements to the patents county court to ensure that it provides access to a simpler, less expensive forum in which to litigate patent disputes.

The Government's innovation report, published at the end of last year, provides another example of our commitment not to let those issues pass us by. In addition, the joint project of the Prime Minister's strategy unit and the DTI on wealth creation from innovation and the knowledge economy will include an analysis of the current regime of intellectual property rights and their role in encouraging innovation in the knowledge economy.

We also had an interesting debate on the pronunciation of the word "patent". Colleagues with an interest in the Bill referred to it as the parents Bill and the patients Bill and there was much discussion of what it was actually about. However, the measure is vital.

Paul Flynn: My hon. Friend will remember the outrageous suggestion that I tried to pull the wool over the eyes of the Committee by saying that the 1,000 people in Newport who have to say "patent" hundreds
 
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of times a day decided that as it took three nanoseconds more to pronounce it with a long "a", they would pronounce it with a short "a" so that they could go home earlier for their tea. The outrageous and flimsy counter to that truth from the right hon. Member for North-East Hampshire (Mr. Arbuthnot) was to suggest that the Romans pronounced the word differently. How does he know that? Can he explain?

Mr. Sutcliffe: I await the reply with interest. I congratulate my hon. Friend for his involvement in the Committee and I also thank the Patent Office in Newport for its excellent work and its support to industry.

In conclusion, I am proud that the Bill plays a part in the continual process of reform and improvement of the patents system—a process that can be traced back four centuries and which will no doubt continue. Our deliberations have truly been part of the long-standing and admirable tradition of making sure that patent law keeps pace with changes in the economy. We will continue with that process, to ensure that the patents system supports and encourages innovation, for the benefit of everyone.

I commend the Bill to the House.

1.18 pm

Mr. Arbuthnot: The Bill deals with something extremely important to our national economy: innovation and scientific advances. At the Lisbon summit in 2000, the Council of Ministers told us that Europe would become the most competitive and dynamic knowledge-based economy in the world by 2010. That is what the Bill is about. Well, jolly good. So why are we going so fast in the opposite direction? Why did a survey in May by the Swiss business school IMD show that the most competitive economy in the world was that of the USA, and that the UK had fallen another three places to 22nd? Why do we have the lowest growth in the English-speaking world? Why has our productivity collapsed in recent years? Why do we have the largest trade deficit for 300 years? One reason is that we have a Labour Government. Another reason is that this country's patents system is not in tune with that of the modern world.

Britain is falling behind in Europe. The Financial Times said in an article in 2001:

"Bottom of the pile for patent enthusiasm was the UK, where only 23 per cent."—

of small and medium-sized enterprises—

"had used the system".

That compared with more than 50 per cent. in Spain. Europe is falling behind in the world. In the USA, taking out a patent costs £10,000. In Europe, it costs about £50,000. In the USA, it takes about a year to take out a patent. In Europe, it takes three years. All that is partly because of the costs of translation, but they only amount to about £12,000 of the £50,000 that must be paid in Europe.

Enforcing patents is very difficult in this country. As we have heard, the patent reform group has been trying to put pressure on the Government to do something to help, and they have come up with the Bill, which will achieve little and deals with none of the real concerns of
 
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the business world. It is, as the Minister said, a necessary Bill because it introduces some minor changes to allow Britain to continue to be a signatory to the European patent convention. If we failed to do that, British inventors would have to take out lots of patents in many different countries in Europe, which would be expensive and time-consuming. There is no point in trying to force them to do that, but no one could say that it is a frightfully important Bill.

I come now to the key issue raised by the hon. Member for Newport, West (Paul Flynn)—the pronunciation of the word "patent", a matter that exercised the Committee for some time. I said that he had led the Committee and the House up the garden path in suggesting that his constituents were supposed to get home earlier to tea, but I am afraid that he has got me wrong: I was agreeing with his pronunciation of the word "patent", on the basis that the Romans would have pronounced patens—meaning, "open"—with a short "a". I just think that he got his reasoning wrong.

We do not oppose the Bill. How could we oppose it? There is virtually nothing in it, and it represents a sadly missed opportunity.

1.22 pm

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