Select Committee on European Union Minutes of Evidence

Examination of Witness (Questions 100 - 119)



  100. I am sure every member of the Committee has taken that point. Within the context of the EC does individual ownership of intellectual property on the Net actually exist and is it worth doing anything about it, which is what the EC and this government are intending to do?

  A. It does exist, as I am sure you know better than I. The Copyright Bill coming out of the 1997 WIPO meeting to do digital copyright extends in quite logical ways to digital works. With many of the traditional copyrights there are a variety of people who have been sued quite successfully over pirating digital works. It does exist. There are also hidden in the bowels of the legislation some quite controversial points in terms of who bears responsibility for what. Again, I am sure you know better than I the notion of when a cached version of a work is held on a computer in transit, if the message is in violation of copyright is the cached version in violation of copyright? While it may be a technical detail it has vast potential consequences for shared liability. Frankly, I have had lobbyists from Microsoft and the software service providers saying, "We want this in there solely so that we can sue the telcos to make them more responsive to us", and the telcos quite legitimately are saying, "We do not really want to be sued. It is not our responsibility. It is going to raise the cost of these services dramatically if we have to try to enforce this and, given that cheap services are economically beneficial, why should we?" Sorry: long answer to your question, but it shows some of the complexities.

Lord Cavendish of Furness

  101. I am interested by the calm way in which at this moment—and this is not critical—when people are looking every day for more redress, for more protection, we are getting the stark message that we are about to face an age of much less protection, more disorder, less redress.

  A. More personal power.

  102. These are the stark facts. If there is some historical precedent for the fact that with these great shifts in the way people conduct their business moralities do develop, is it possible that the First Tuesdays of this life can become a sort of Law Society for the legal profession and try that?

  A. I have never thought of that one.

  103. I have confidence in the law because of the Law Society. I may be wrong.

  A. It is a very important point. The distinction I would draw to some extent is between standards and conventions because of things like First Tuesday and networks and because of the speed of communication across the Net. It is very easy to create conventions. Indeed, the Internet is a convention. It has voluntarily adopted standards that are not imposed by a committee or by a standards organisation. There are things people agree to do in the same way in order better to work together. Because of the speed of communication and feedback the good news is that it is very easy to catch, to comment on, to give feedback to violations of those conventions. Fraudulent websites, bad information, dubious argument, are all chased across the Web right, left and centre. That is not to minimise the problem that there is a lot of dubious argument and bad information out there in the first place but there is a redress to it.

Lord Woolmer of Leeds

  104. Could I return to your paper which was most interesting? In one or two places you appear to be saying, and I would not want to put words in your mouth, that perhaps one of your principal concerns is that where there are regulations, not specifically aimed at e-commerce and the Net and so on, but about employment, about taxation and so on, your desire would be that at least they were consistent and harmonised rather than getting into a great deal of argument about whether taxes should be lower or higher, but whatever they were it is much more important that they are harmonised. If there were an order of priorities would that be your first priority?

  A. I think I would be very disappointed if harmonisation went upward. If you had for example French employment law, Spanish company law,—I cannot think of a British example because by and large I cannot think of too much to complain about—then you would have the worst of all possible worlds. In general, assuming that you do not manage uniquely to capture the worst of every jurisdiction, harmonisation is at least as important as, if not more important than, any specific inclusion. Harmonisation is predictability. It is the ability to know what you are going to do, understand what the set of issues and problems is and do it, move fast.

  105. If I may return to the medical analogy, am I right in thinking that what the technology revolution has done is simply to transform and reduce the cost of obtaining information and transmitting information? One has always for a long time been able to find out where one can get medicines outside your own jurisdiction, if you work hard enough at it, and you could probably get somebody to send it to you, but what the Web does is enable you very easily, very quickly, very cheaply, to find out that information. It is not that there has been a change in the various legal relationships except that your access to the information and the number of people who access it is very much cheaper and hence more widespread. Is that fair?

  A. Yes.

  106. In the past the ways of regulating would have been either to seek to regulate the provision of information and the Web enables people to leap over that because you can access the information, but historically you could then (and I am not suggesting you should; I am clarifying my mind) seek to prevent the sending of the physical goods if you were buying goods as opposed to services. You would seek to prevent those coming across the border. For example, I am sure the Chinese can find out where they can buy medicines from America, but getting them into their homes in China would be regulated by the Chinese authorities in the way in which they have always been. Is that a fair picture of where we are?

  A. Yes. One of the solutions to the original problem of censorship is to turn the solution on its head. With broadcast mediums you censor the transmission of information which is very difficult if not impossible on the Web, but the Web does give you a variety of ways to limit the reception of information. The software that schools are using for example prevents my son and other children from bringing in websites. There is a variety of ways of protecting stuff. The medical example is a particularly good one because it does show some of the leakiness. Of course you have to face up to the fact that it is going to be hard to do. Let us be honest. This is not entirely a new problem and technology is not entirely creating it. There are tons and tons of blatantly illegal drugs, not just semi-legal drugs, which are coming across the border on any given day despite efforts to stop them.

  107. Can I turn to the concrete issues on this theme of harmonisation as opposed to no regulation at all? From your point of view, looking at the industries, do you think there are issues on intellectual property, on host/home country, of taxation, in other words, if there is going to be taxation in the world, if you need public services at all, to have some form of taxation that does not simply get swept aside by leapfrogging in and around all this? Do you think that those are issues that governments, EU or otherwise, still legitimately need to address? If so, how do you think governments can seek to find a level playing field that does not in the process of doing that cause problems for the new technologies?

  A. We are still at the very early stage of understanding what the landscape is going to look like. I would agree with Baroness O'Cathain saying that the future is not like today only more electronic. At some point things change pretty dramatically because information, computers, industries, governments, do not work like others. Part of the key approach is not to snatch at solutions, for the time being to be aware of the limitations in our ability to predict the future, and to solve the obvious problems, avoid obvious inequalities, move rapidly when there is some certainty as to how to proceed, but to be somewhat cautious in the fostering of the new economics and the new technologies as they go. Something I would point to there is that there has been a consciously adopted policy of a tax moratorium and it is a temporary moratorium that the US has put on. Tax is a real issue that governments will have to address and it will have to be addressed globally because it is a global market. The US is saying, "We just do not know enough about how people are going to shop here yet. Let us let it grow a bit."

Lord Chadlington

  108. I have a very brief supplementary to the point I asked before. Can I go into areas which clearly we would all agree were wrong: child pornography, for instance? I think 99.99 per cent would agree with that. I have got a nine-year-old son for example who spends more time on his computer than he spends watching television. Is there any way that we can agree about certain global things, do you think, as governments or, to take Lord Skelmersdale's point, Europe, or whatever area? Could we take one or two major subjects, which we could actually put the force of law behind to prevent or do you think that also has to be completely left open?

  A. I think child pornography is one, but it is not like the Net created it and it is not like it is not illegal. It is illegal. People go to jail for having this on their computer. The fact that the Internet enables it to be more rapidly disseminated is in some ways a threat but also, if you have an intelligent policing system (the police systems are led by the Dutch I think who are getting much more intelligent about tracking it down) you can look back the other way up the pipe. If there is child pornography being transmitted where is it coming from? Who are these pornographers? They are breaking the law already. Let us use this greater flow of information to track them down and put them in jail.

  109. You see that there would be some things—I do not want to become like Lord Cavendish leaving this meeting feeling that the whole world is going to be turned upside down—that you think are like that. Drugs is another good example. I do not know this for a fact—that you can get better quality hash over the Net than you can by going down to Soho. I am told. This is clearly something that is illegal. Do you think there are things that we could enforce, either by geography or globally, in order to prevent those things becoming more easily available to people?

  A. As Lord Woolmer was saying, the Web makes things easier to find and to transmit. That will not change what is illegal or not illegal. Most governments around the world have made drugs illegal, have made child pornography illegal.

Baroness O'Cathain

  110. Surely governments have responsibility to protect the health and welfare of their citizens in so far as they can whilst allowing them to have freedom which applies in a democratic situation. If for example there are drugs which are very well known to cause real damage to human beings, you cannot say to the human beings, "Do not take that". For example, if there was a drug which would help somebody suffering from multiple sclerosis but people know that the side effects of that drug are so appalling, yet people who were suffering from multiple sclerosis would probably want to take it. How could governments stop those people doing real damage to themselves?

  A. In practice the social trend is for governments not to stop, for two reasons. One is demographics. We are dealing with a significantly more educated workforce—

  111. We are not really.

  A. —and population than we ever had before. They are going to university. They are taking white collar jobs. People who at least believe themselves to be. In a democracy people believing themselves to be capable of taking their own decisions is an important thing. Secondly, in practice in those sorts of cases it is seldom black and white. If I am about to die of cancer, who but I really can make the decision of whether I should take a drug that might blind me or whether I should die? Ultimately that is kind of my choice and I should like to make it. I speak for myself but I think I also speak for a lot of other people in that situation.

Lord Paul

  112. With all the laws which there are for preventing drugs as well as child pornography, governments have not been able to enforce them at present. Are they really enforceable at all?

  A. Taking the economic analogy, so much government effort is put on the supply side in trying to stop drugs being produced. Increasingly what governments can affect is the demand side. They can try and explain to people not to take drugs, and if the people really wish to take drugs, well, then their powers to stop them become significantly more limited.


  113. If you are saying you can go back up the pipeline on child pornography, you can go to the source, why should you not go to the source on hackers? Why should you not go to the source on people who are on the website advertising drugs? There is a whole range of issues. Why should you not access anybody's e-mail if you so wish? Why should a piece of paper not float around on a wire to journalists that there is a cyber crime treaty contemplated in the Council of Europe, with consultations between European countries, the States, Canada, Japan, South Africa, South Africa?

  A. As much as I understood the question, it was that if some things are illegal why should we not be able to look everywhere to ferret them out.

  114. Why should we not be able to enforce it if people collectively come together and create a treaty?

  A. I think we can. There are going to be limits though on privacy. It is not new dilemmas. The fact that some things are illegal to have in your house does not stop us from discussing search and seizure and when you can go in and when you cannot, and we will want similar civil accommodations for electronic communication. When is it legitimate to wire-tap? How is it wire-tapped? Insert the large and deleted sections of the Electronic Commerce Bill here.

  115. Then it is public opinion, is it not? In this country we have the Data Protection Act, and there is a directive for one in Europe. No such legislation exists in the States. Yet the recent survey work done by Andersen Consulting seems to indicate that there is quite a body of opinion in the States now moving in that direction.

  A. Yes, and self-regulation has been somewhere between disappointing and not encouraging on this scale of good to bad. I was particularly amused that the White House was not actually opposed to privacy policy at the time that Al Gore was wandering around saying that self-regulation as opposed to privacy policy was the way of the future.

Lord Woolmer of Leeds

  116. I should love to follow that last point up. It is almost like the agenda for a meeting for someone, is it not? In your paper you gave two concrete examples which, let me assume, would apply to you, that in your and your colleagues' view would help the promotion of e-commerce and the Web and young entrepreneurs. One was obstacles to company formation, to licensing and so on, the whole range, and that these by implication vary in Europe, and getting greater consistency and speeding it up would help. Secondly, the differential treatment of stock options in tax regimes within the EU in your view is holding back young European entrepreneurs. Would it be possible for you to give us a note that gave practical examples of those so that we have concrete examples and see the reality of those, because at the end of the day you said, "Do not keep jumping into everything all the time but when you do, act quickly." I took your message to be that they are two areas in your view where action is needed.

  A. I take it that this is a "go away and send back" question.

  117. Yes.

  A. Yes, I am happy to do that.


  118. You do have an opportunity with us to feed some of the views of your club into areas where they may take notes.

  A. It strikes me that you are interested in finding out what European entrepreneurs are talking about and are concerned about. We have a good 30,000 of them who pay attention to the e-mails that we send out. We would be more than happy to ask questions on your behalf.

  119. We are opening a Web page.

  A. Yes, why not. Put up a Web page.

previous page contents next page

House of Lords home page Parliament home page House of Commons home page search page enquiries index

© Parliamentary copyright 2000