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I emphasise that the Government are cognisant of all the issues that have been raised. I wish to deal with one other extraneous factor. I do not call it a red herring but my noble friend Lord Mitchell is right when he says that a lot of downloading activity goes on among young people who, if not acting in full innocence, are certainly not setting out to be law breakers and we would not want to criminalise them. As a fair percentage of the people in the age bracket he identified are voters, I am sure that we do not want to be in the business of criminalising them in this year of Grace 2010.

Let me emphasise the fact that the Bill is not about criminalising people. That is not the issue that we are involved in. Peer-to-peer file-sharing is already unlawful. With the Bill, we are simply seeking to enforce an existing civil law more effectively. The behaviour we are tackling is a civil infringement, not a criminal one. I want to dispense with the canard that we are about the criminal law against people who, in many cases identified today, may be acting with some degree of innocence.

The Earl of Erroll: I have a quick technical point. I get fed up with hearing that peer-to-peer file-sharing is unlawful. It is file-sharing that is unlawful by whatever technical means. Peer-to-peer just happens to be one of the common technologies used for it. I do not like the fact that in Digital Britainand other places they put "unlawful peer-to-peer file-sharing". It should be peer-to-peer unlawful file-sharing. I think it is a point we should remember because at several points in this Bill we muddle up the two things. Peer-to-peer technology is very useful for various purposes.

Lord Davies of Oldham: I and the House are grateful to the noble Earl, Lord Erroll, for making that point at this stage. The more substantial point I am seeking to deal with is whether we are about criminalisation-we are not. What are we seeking to deal with which causes the noble Earl, Lord Razzall-sorry, the noble Lord, Lord Razzall-concern in the amendment? As he expressed in his opening remarks, consumers and consumer organisations are greatly concerned about the issue of actions by certain law firms, graphically expressed by the noble Lord, Lord Lucas. These firms

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have acted on behalf of rights holders and obtained, on the basis of evidence of infringement, thousands of names and addresses via court orders. They then sent letters to those identified telling them that they could pay something like £500 for the case to be dropped or face court action. Of course, there was the possibility that the court action might involve much greater amounts indeed. I am aware that several people have claimed that the allegations have no foundation but are nevertheless reluctant to risk defending the action in court. We can all see why people would react in this way.

The idea, as I understand it behind the amendment, is to require rights holders to use the provisions we are making available to them through this legislation rather than resort to measures adopted in the examples we all find have been the subject of abuse. I have already sought to indicate that I have great sympathy with that proposition.

It is not the Government's intention through this legislation to weaken the ability of rights holders to protect their copyright material. I want to reassure the noble Lord, Lord Howard, on that point. This includes their ability to use the existing law to defend themselves against online infringement. We all recognise that there has to be effective action available. The noble Lord, Lord Triesman, identified the issue of rights holders. To give one illustration, James Cameron's film "Avatar" had one of the most successful launches of any film in the history of the cinema, but it has been calculated that there were 300,000 downloads on the day it was released. Both James Cameron and the backers of "Avatar", who are not without resources, may be well able to stand that degree of activity; after all, the film is due to gross several times its production costs, which run into hundreds of millions. But it is indicative of what can go on, and others may be in a position where the whole of their potential profit would be lost in these circumstances. The issue then arises, again expressed by my noble friend Lord Triesman and supported by the noble Lord, Lord Birt, of where our creative industries and creative minds are going to be if they are stripped of the rewards of their enterprise, activity and creativity. That is a serious issue for the British economy; the creative industries play a substantial role in the jobs/welfare economy of our society.

5 pm

The Government are concerned about this problem, which needs to be addressed. We need to get the balance right, which is why this is merely the first of what are bound to be more detailed debates on more detailed amendments over the next few clauses. We also have to address the issue of principle in the Bill. We have a great deal of time in which to address these matters, so we do not need to put all our eggs into the basket of this amendment.

The initial obligations on internet service providers under the Bill are based in part on making the existing law more effective. Rather than resorting to a scattergun approach, copyright owners will be able to focus their attentions on those who appear to be infringing most. We expect copyright owners to use existing law to obtain their details through a court order and take action against them to defend their rights, and to

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demonstrate that this is not a risk-free activity. Such action is an essential element of the deterrent effect of the initial obligations.

Because the Bill provides a much more effective way of defending copyright owners' rights, we are confident that most responsible copyright owners will want to work through this process. I accept that this will not prevent those who see this more as a revenue-generating activity from using existing law, but it is of course the opportunity to defend an action if someone is convinced that they have indeed been accused without good cause. Removing the ability of responsible copyright owners to protect themselves would be a gross overreaction. Of course there may be cases-business software, for example-where each infringement could equate to thousands of pounds of products unlawfully obtained, and it is sensible and appropriate for the copyright owners in those circumstances to use the existing system, but the concern behind the amendment is not something that this legislation can properly address. On that basis I sympathise with the rather jaundiced view that the noble Lord, Lord Razzall, takes of the actions of particular firms; we appreciate that point.

I hope I can assure the House that we will investigate further with the Ministry of Justice and others within the Government with an interest to see if there are other ways in which the bullying activity identified by the noble Lord, Lord Lucas, can be addressed. There is no doubt, though, and this debate has reflected all dimensions of the issue, that, first, there are rights that need to be safeguarded, and, secondly, some are in a position where they can appropriately use existing legislation and can pursue the force of law in those terms. However, we certainly have to address the fact which my noble friend Lord Mitchell identified-that great activity goes on at the other end of fraudulent activity. It is innocent activity by people who think that they are doing no wrong. Within that framework, the Bill has a much softer approach on the process by which people who are engaged in activity that is not acceptable and not lawful will be warned and given the opportunity to correct their behaviour. We are not talking about criminal sanctions with regard to such activity at all.

I hope that it will be recognised by the Committee that this has been an extremely useful debate. The noble Baroness, Lady Miller, asked me a particular question. We have put in the Library a document about the Bill, Online Infringement of Copyright: The Details. In it, we have spelled out process in some detail. Copies are available in the Library and I imagine elsewhere too. I will happily send the noble Baroness a copy of that document, because it indicates the careful way in which we are addressing this issue.

We are at the beginning of very substantive debates in which will be able to deal with every nuance of these matters. However, I hope that the noble Lord will feel that he can safely withdraw his amendment at this stage.

Lord Lucas: My Lords, I apologise to the noble Lord for the use of the word "criminalise". "Civilise", which I suppose would be the equivalent, did not seem quite right in the circumstances. I am sure he knew what I meant.

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At the beginning of this part of the Bill, I ought to declare my interests. I earn most of my income outside this House from the sale of copyright material. So, I should naturally be on the side of the companies, but, perhaps instinctively, I am not.

We should not forget that the main companies involved have methods of protecting their copyright that they have chosen not to use, namely digital rights management. It was there in music to begin with and now is not, which is not because they found it difficult to sell music that way. They are asking us to use a different way. It is not as if they are alone in the world without a friend or way of looking after their own interests.

We should be conscious in what we are doing of the proper balance of things, because there are alternatives. We should also not put ourselves in a position where we are encouraging these industries to stay in the market positions that they are in at the moment. The market is changing fast. It is full of new opportunities. Yet these big companies are used to their old comfortable ways and seem to want to stick to them. The noble Lord used the example of films. I listened to people from a major film company the other day. They were surprised that, when they release a film in the States, suddenly copies start appearing here on the internet. The old practice of releasing a film six months ahead in the States and making us wait six months for it will not do. They have to move. They have to change.

People love going to the cinema to see something like "Avatar". It is an extraordinary experience on a big screen. However, why do the companies not sell DVDs and allow the downloading of copies of the film at the same time? It would not reduce their cinema take; it is nothing like the same experience. It just gives people who would never go to the cinema the chance to see the film.

These companies created the piracy problem. They are continuing to create it. We must not, in this Bill, give them the illusion that they can stay where they are and that beating up on their customers is the solution to all their problems.

Viscount Bridgeman: My Lords, before the noble Lord sits down, I am sure that we do not have to remind him that there are copyright holders-I am thinking particularly of small-time photographers-who are of very limited means and experience in this kind of practice. They are the ones that need to be protected in this Bill.

Lord Razzall: My Lords, I well understand the temptation that the Minister succumbed to of joining in what I think is the third Second Reading debate that we have had so far; I look forward to many more. I was particularly glad that he got so carried away that he conferred on me an earldom that is well deserved but which I suspect is above his pay grade to award.

I do not wish to join in the fun, other than to say that it is seriously important to pick up on the comment made by the noble Lord, Lord Mitchell, to which the Minister and the noble Lord, Lord Lucas, referred: that this Bill is not about criminalising individuals, whether they are 12, 20 or 85. No proposal in the Bill involves criminalisation. It is very unfortunate when people suggest this, because it gets the debate off on

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the wrong foot. Indeed, those of us who followed the process that has ended up with the proposals in Clauses 4 to 17 will be well aware that a lot of the internal debate was about the absolute importance, in trying to get the balance right, of eliminating criminalisation from the Bill.

I will withdraw the amendment in a moment, but one or two issues to which the amendment relates should be focused on. First, the Minister suggested that its purpose-the noble Lord, Lord Howard of Rising, who is now returning to his place, made the same point-was to remove copyright holders' current rights to pursue individuals who download, or who commit what they would regard as copyright theft. That is not the case at all. If noble Lords read the amendment-clearly, few noble Lords who have participated in this debate have done so-they will see that all that is proposed is a graduated response and that the process set out in Sections 124A and 124E of the Communications Act 2003 should be used by a copyright holder who wishes to engage their lawyers to pursue individual infringers. That is all they have to do. While that graduated response is gone through, they have exactly the same rights that they have under existing law.

The amendment in no way attempts to remove from existing copyright holders the rights that they already have to pursue individuals if they choose to do so. This is important because, as the noble Lord, Lord Mitchell, has indicated, thousands and thousands of people out there are illegally downloading material. The whole purpose of Clauses 4 to 17 is to set up a system through which there is a graduated response to get those people to stop before they lose their internet access. A graduated response would deal with the issue raised by the noble Lord, Lord Mitchell, and others: namely, getting the balance right between people who feel that they are entitled to download material and copyright owners who feel that they are being deprived of their royalty income.

In conclusion, the owners of the rights-the companies, the individuals-cannot have it both ways. They have spent an awful lot of time lobbying the Government to bring in the proposals that are now enshrined in the Bill, assuming that it is passed. The whole point is that there should be a graduated response, and education-people should realise that they cannot do this. They cannot, on the one hand, say that they want the huge effort that is being made by the Government, by the ISPs, by their own companies and by Ofcom to get a code that everyone will observe, and, on the other hand, say that they also want exactly the same rights to pursue individuals in the ways that have been criticised. That is the purpose of the amendment. Until I heard this debate, I had not realised how important the amendment was, but I have pleasure withdrawing it. I beg leave to withdraw the amendment.

Amendment 33 withdrawn.

5.15 pm

Amendment 34

Moved by Lord Clement-Jones

34: Before Clause 4, insert the following new Clause-

"Compliance with fundamental rights

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In drafting or amending any code, laying any statutory instrument, or taking any other action under sections 124A to 124L of the Communications Act 2003 or under section 302A of the Copyright, Designs and Patents Act 1988, the Secretary of State must demonstrate before such action is implemented that he has considered whether such action-

(a) is necessary and proportionate to the goal of protecting and enforcing copyright, and

(b) appropriately balances the interest of rights holders and the interests of the public in due process, privacy, freedom of expression and other fundamental human rights guaranteed by inter alia the European Convention of Human Rights and the EC Charter of Rights."

Lord Clement-Jones: My Lords, as the Minister said, the debate that we have just had represented all dimensions, and this amendment follows on from that very neatly. I shall not indulge in a Second Reading speech, as both my noble friends Lord Razzall and Lady Bonham-Carter made our approach to the Bill very clear. Of course we recognise the issues surrounding internet downloads. We recognise that problem and the need to provide better enforcement of copyright to protect creators. If we do not protect copyright, we shall not have a creative economy. However, as the Minister said, we have to get the balance right. This amendment provides a general framework, an umbrella if you like, for getting the balance right.

All sorts of amendments will arise before we have finished with these clauses, but the areas where we want to see changes-I have no doubt that my noble friend Lady Miller agrees with me on this-concern the quality of evidence that is presented, the burden of proof and the necessity of ensuring that sanctions are proportionate, codes are clear, costs are fairly apportioned, thresholds are proportionate, and that the overall scheme of things is not oppressive to those who it is claimed are in breach of copyright.

I am sure that we will discuss these aspects in further Committee sittings. We believe that the language of the new EU telecoms directive is important in these areas. I bow to the superior knowledge of the noble Earl, Lord Erroll, in this regard. Indeed, his speech was largely devoted to the language of the new telecoms directive, which specifies that a balance must be struck between the different interests and rights. That seems utterly apposite to these provisions. We may express a range of different views, but I was struck by the fact that nobody denied that the interests of creators had to be protected. On the other hand, I do not think that anybody in this Chamber believes that we need a draconian, disproportionate way of enforcing those rights. I am sure that many of these aspects will be dealt with by the end of the Committee stage. I believe that we can usefully use this framework in that process. I beg to move.

Lord Lucas: My Lords, this is an extremely worthwhile amendment. Copyright at its heart is not a right, it is a compromise. Copyright can be described as a tax or as a monopoly. Neither is a desirable thing to my mind. Copyright is merely what we do-the tough, difficult, bad thing we do in order to enable the good thing, which is creativity, to flourish. It is inherently, therefore, a balance between the costs we impose on the innocent enjoyment of good things by members of the public in

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return for making it possible that such good things can be created. So the idea of balance ought to lie at the heart of our consideration of copyright.

In discussing the previous amendment we touched on how we balanced the rights of the individual copyright holder with the rights of the citizen who was faced with a demand which they had no reasonable way of defending. One idea that we did not touch on when discussing the previous amendment-so I cast it before the Minister now as an idea-is that perhaps we should have within this a tariff, a means of establishing the fine which the offender should pay, should they choose to admit their offence. In that way we could establish a reasonable and rational level of cost for the infringer, rather than leaving him at the mercy of the courts and of solicitors who push on the fear factor. As I say, balance should be key to this, so I support this defining amendment as part of the Bill.

Lord Whitty: I, too, support this amendment or something like it. The Government would be wise to accept at least the principle of this amendment because it would calm some of the fears of the system outlined in the next few clauses, both in relation to the existing system and, more particularly, to the new system proposed in Clauses 4 to 16, where there are issues of proportionality, of due process, and of privacy, all of which would be covered by reference to a check against the Human Rights Act. I therefore hope that the Government can accept something like this amendment.

Baroness Miller of Chilthorne Domer: The Minister has cleverly got round my question of how the evidence is gathered by referring me to the note in the Library. Although it is a very helpful technical note, it would still be useful to have something on the record. This amendment speaks to the particularly important issue of the right to privacy. Checking on other people's internet traffic to see whether file-sharing is taking place is akin to opening somebody's post in envelopes to see whether they have illegally photocopied books, for example. It is very similar. Can the Minister explain a little how that technical process is going to take place, and also how the person accused of that will refute the allegation? I think that this goes to the heart of whether the public will be able to understand how the evidence against them is gathered and how they can refute it.

The Earl of Erroll: I know that I pointed this out under the previous amendment but, looking at it and thinking more about what people have said, I think that part of it applies to this amendment as well:

"Access to, or use of, services and applications through electronic communications networks shall respect the fundamental rights and freedoms of natural persons".

It goes on to say that they can only be imposed,

And it finishes up:

"The right to an effective and timely judicial review shall be guaranteed".

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If we do not comply with that in the Bill, we will be in breach of our commitments to Europe and the European Convention on Human Rights. The Minister's certificate on the front of the Bill may actually be misleading. I would like to see something like this in the Bill, as I think that it is essential.

It can also be used to cover some of the issues around proportionality in Amendment 33. Was it proportional even to use the civil law in the way that it was used? The noble Lord, Lord Birt, represents that all this creativity will disappear if we do not have this provision. Actually, the Bill protects the back catalogue of six or so large digital rights companies. On the whole, the small people will not be protected by patent law because they cannot afford it. There will be no one on the internet looking for their songs being downloaded and no one interested in pursuing those cases. The small people are already putting their stuff out through other methods. The other day, I looked at Pledge Music, for instance. It is a rather clever idea for people to pledge money for some of the stuff that has been produced. It has been shown that a lot of the people who do this downloading also spend a lot of money on other products associated with it, so the concept that these people are losing all their money because there is downloading going on is not necessarily true.

This is slightly, but not entirely, off the point. I remember back to when the music industry said it was going to be wiped out by the Philips cassette. Exactly the same thing went on. It tried to crack down on people caught with Philips cassette recorders and ban the production of machines with two cassette decks which were clearly for copying cassettes. Did it make any difference? At the end of the day, no. "Avatar" is an interesting example. Has it suffered as a result of the fact that 300,000 copies have been made? Would people have gone to the cinema anyway? Perhaps they will go to watch it in full 3D glory, having sampled it on an inadequate little screen. These things may have benefits.

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