Select Committee on Innovation, Universities and Skills Second Report


Conclusions and recommendations


Importance of intellectual property to the UK economy

1.  Given the value of the creative industries and the importance of intellectual property to the UK, we welcome the setting up of the Strategic Advisory Board for Intellectual Property and of an economics and evaluation unit within the Intellectual Property Office. (Paragraph 12)

Is the Copyright Tribunal restraining the rightsholders' monopoly?

2.   The 2007 IPO Review of the Copyright Tribunal recommended that collecting societies as well as users have the right to make reference. We support this recommendation. In addition, we recommend that the Government implement this recommendation ahead of the others in the 2007 IPO Review. (Paragraph 21)

Complaints about the operation of the Copyright Tribunal

3.  We are concerned that complaints about delays and costs at the Copyright Tribunal going back 20 years were not resolved by the Patent Office. We hold it (now operating as the Intellectual Property Office) responsible for this unacceptable failure. (Paragraph 25)

Intellectual Property Office Review of the Copyright Tribunal

4.  To assist all those with an interest in the operation of the Copyright Tribunal, we recommend that the Intellectual Property Office set out how it expects the Copyright Tribunal to function, in particular whether it is expected to function as an adversarial, commercial court. (Paragraph 28)

5.   We recommend that the rules under which the Copyright Tribunal operates be reviewed. (Paragraph 31)

6.  We recommend that the post of Chairman of the Copyright Tribunal be a salaried post. (Paragraph 32)

7.  We find it hard to understand why no action was taken on the Monopolies and Mergers Commission's 1988 recommendation that the lay members of the Copyright Tribunal be chosen on the basis of specific expertise. (Paragraph 36)

8.  We recommend that lay members continue to be appointed to the Copyright Tribunal, but that future appointments be open, transparent and based on expertise that is relevant to the work of the Copyright Tribunal. (Paragraph 37)

9.  We conclude that the administrative support and resources that the Intellectual Property Office currently provides to the Copyright Tribunal are wholly inadequate. We recommend that level of support and resources be reviewed as a matter of urgency. (Paragraph 40)

10.  We share the concerns of those who have argued that placing a requirement on users to produce their own actuarial calculations and sampling figure risks adding to the burdens on users and also that it may add to the complexity to the proceedings in the Copyright Tribunal. We recommend that the IPO reconsider whether it is reasonable to impose such a requirement on users. (Paragraph 43)

11.  We conclude that the 2007 IPO Review's recommendation that the Copyright Tribunal become active in formulating methodologies is problematic. The 2007 IPO Review failed to spell out what this work would entail, the degree of expertise and resources required or to consider whether such work would prejudice the Copyright Tribunal. We do not deny that the assistance proposed by the 2007 IPO Review may be valuable and we therefore recommend that the Intellectual Property Office consider an alternative to the Copyright Tribunal to provide the assistance. (Paragraph 46)

Case Management

12.   While we expect that the streamlining and case management procedures that the 2007 IPO Review has recommended will achieve some improvement in the throughput of adjudications by the Copyright Tribunal, we recommend that the Intellectual Property Office and the Government examine other measures to increase the capacity of the Copyright Tribunal to handle a greater volume of references. (Paragraph 48)

13.  We conclude that, while the 2007 IPO Review's recommendation that there should be a single, joint expert witness is superficially attractive, it may not work in practice. We invite the Intellectual Property Office in responding to this Report to explain how it will work. (Paragraph 50)

Departmental responsibility for the Copyright Tribunal

14.   We recommend that responsibility for the Copyright Tribunal remain with the Intellectual Property Office. (Paragraph 54)

Access for small businesses, institutions and individuals

15.  We conclude that the current arrangements unfairly exclude individuals and small businesses and institutions. We recommend the Government rectify this serious deficiency when it responds to the 2007 IPO Review of the Copyright Tribunal. Failure to provide access for individuals and small businesses and institutions casts doubt over the fairness of the operation of the licensing societies' monopoly. (Paragraph 58)

Arrangements to provide access

16.  We recommend that the Intellectual Property Office evaluate the options to provide access for small business and institutions and individuals that we describe in paragraphs 60 to 64 of our Report. We conclude that one of the tests against which any changes will be measured is whether the individual or the small business or institution can challenge and change charges for using copyright-protected material without costly litigation but also without incurring major consequences for people not a party to a particular action. (Paragraph 66)

Orphan works

17.  We recommend that in its response to this Report the Intellectual Property Office set out its policy on the treatment of orphan works and that, in particular, it explain whether it supports licensing of or exemptions for orphan works. We further recommend that, to give certainty to those to whom orphan works have caused difficulties, the Intellectual Property Office consider an interim solution based on the exception approach, pending the outcome of the EU's deliberations. (Paragraph 71)

Conclusions

18.  We are surprised that a tribunal headed by a judge, who does the work unpaid and in his spare time, assisted by a barrister paid £316 a day and two lay assessors with no relevant technical expertise, functions to the level that it does. Changes to the operation of the Copyright Tribunal should have been made in the 1980s and it is to no one's credit that nothing has been done for 20 years, particularly the Patent Office/ Intellectual Property Office. We have now reached the point where reform is long overdue and needs to be made expeditiously to meet the challenge of digital technology. We have high expectations of the Intellectual Property Office to implement a programme of major changes in the operation of the Copyright Tribunal. (Paragraph 72)

19.  The 2007 IPO Review of the Copyright Tribunal set out a list of changes, most of which have support from both users and rightsholders. The recommendations in the Review that give us most concern are those that add to the Copyright Tribunal's workload or could be perceived to compromise its impartiality. These need to be re-examined. The Government now not only needs to publish its response to the Review but also to set out clearly how it expects the system to operate, the volume of cases it expects the Copyright Tribunal to handle and the average time that a dissatisfied user or rightsholder can expect a case to take. It also needs to develop as a matter of urgency an affordable, alternative service that individuals and small businesses and institutions can use as well as a policy on orphan works. Given the increasing importance of intellectual property in the economy and the new challenges stacking up in this area, it is essential that serious attention be now paid to this rather neglected area of policy. (Paragraph 73)



 
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Prepared 20 March 2008