There will be much more debate about this whole issue of lobbying. We should wait and see what the new Transparency of Lobbying, Non-party Campaigning and Trade Union Administration Bill eventually produces. I think it will emerge at the end of its parliamentary proceedings looking very different from the air that it has as it moves towards Second Reading. On that basis, I beg leave to withdraw the amendment.

Amendment 12 withdrawn.

Clause 20 : Reporting duty

Amendment 13

Moved by Lord Clement-Jones

13: Clause 20, page 18, line 19, after “Kingdom,” insert—

“(iii) progress has been made in protecting metadata”

Lord Clement-Jones: My Lords, briefly, this is a shameless attempt to publicise a success story from the Copyright Licensing Steering Group, the people who are bringing us the Copyright Hub. I take your Lordships back to the passage of the Enterprise and Regulatory Reform Act 2013, when a number of us argued for progress on metadata protection to be included in the Secretary of State’s annual report. On 6 March of this year the Minister said,

“The Government are keenly aware of and sensitive to the concerns of creators in relation to metadata. They believe that an industry-led approach is most likely to identify the key issues and the most effective solutions. … The Intellectual Property Office will also be working with the Technology Strategy Board to consider other options to tackle the issues around the misuse of digital images as well as search and stripping of metadata. I hope that in the light of what I have said in my brief comments my noble friend can withdraw his amendment”.—[Official Report, 6/3/13; col. 1602.]

It is very gratifying to be able to report that a sub-group of the Copyright Licensing Steering Group has produced, with a very comprehensive range of people within the industry, a draft code of practice that aims to ensure that relevant licensing metadata is identified in a consistent manner and remains readily available for licensing purposes. It calls on creators of images—photographers, and so on—to make it easier

23 July 2013 : Column 1208

for potential users to find them by ensuring that they include key information such as their name, the date of creation of the image and a contact address. For users of images, the code of practice recommends that they take all reasonable steps to check that licensing metadata is attached to an image before they use it.

I understand that the draft code of practice is currently out to consultation and the Copyright Licensing Steering Group is seeking views on whether it is pitched at the right level and whether having general principles rather than more detailed principles is the right way forward. The Copyright Hub itself is now using Getty Images technology to search and identify images. It looks as though the Copyright Hub will fulfil the hopes placed in it, together with this whole development of protection of metadata.

The irony is that metadata stripping is unlawful under Section 296ZG of the CDPA 1988. The problem until now has been the issue of policing and enforcement. It looks as though photographers will be able, through a combination of the code of practice and the fact that the Copyright Hub is coming into existence, to remedy the unlawful stripping of metadata. It is good to know that other aspects of the Copyright Hub are being developed; some of them involve metadata, others do not. In the case of music, that is in conjunction with the new Global Repertoire Database.

It is useful to reflect briefly that this has been an interesting year in terms of debating and discussing intellectual property so fundamentally, and that there is some good news out there. I beg to move.

Lord Howarth of Newport: My Lords, the noble Lord, Lord Clement-Jones, takes us back quite nostalgically to the days of the passage of the Enterprise and Regulatory Reform Bill. He is absolutely right to remind us of the importance of the metadata issue. It would be welcome if the annual report were to include a section describing such progress as may be being made on that important issue.

I will speak to Amendment 14, in my name. I very much welcome the commitment that the Minister has made in the Bill to the publication of an annual report. Policy on intellectual property is arcane and is vigorously contested among specialists and between special interests. It is very important—its effects are far-reaching—yet it is not well understood, either by Parliament or the public. I therefore hope that the annual report will be more ambitious than is suggested by the terms of the clause in the Bill. I want it to range rather more widely to help Parliament and the public better understand the major policy issues and the principles which animate the Government in taking their specific decisions and formulating their broader policy.

I take it that the role of government is to judge the balance of the public interest in relation to intellectual property between affording protection to creative individuals and enterprises, and opening new possibilities as early as possible to the wider public, consumers and other originators of ideas and knowledge, such as academics, designers and other creative people.

Of course we need to protect intellectual property in certain circumstances. It is essential to incentivise innovation. Often there is a strong public interest in

23 July 2013 : Column 1209

that—but not invariably. It should not be axiomatic that we grant more and more intellectual property rights. Applications should be judged on their merits. The Intellectual Property Office and the Government should not be negative but should be sceptical about applications, and should all the time be ready to question the consensus. While it is desirable to achieve an alignment of international regimes, for example through agreements at European Union level, it is important not to rest on the achievement of those agreements. As the noble Viscount reminded us, consistency is not necessarily a virtue.

Intellectual property is a form of monopoly. It leads to some rigging of the market and restraint of trade—and rigged markets and restraint of trade carry with them inefficiencies and opportunity costs. Others are restrained from accessing or exploiting new knowledge as early as they might do. Price competition is postponed. The holders of intellectual property, being protected, may become complacent and less innovative. That would be an ironic outcome of a policy intended to promote innovation. The incumbent may try to use monopoly power to crush rivals and new challengers who dare to enter the field.

Historically there have been vast benefits when decisions have been taken not to patent new discoveries. Jonas Salk declined to patent his invention of the vaccine for polio—to vast human benefit. Sir Tim Berners-Lee thought it was wrong to patent the world wide web. While it will be many decades before we can begin to assess the benefits or otherwise of that decision, it certainly created large new freedoms.

In Committee, my noble friend Lord Stevenson and I used the historical metaphor of the enclosures movement. We agreed that we preferred intellectual commons to intellectual enclosures. As the House will know by now, my view is that intellectual property is a necessary evil and that we should keep it to a minimum—just enough but no more than is needed to incentivise. Yet the tendency of policy has been to lengthen protection, and Governments have been prone to brag about the number of patents that are held in the UK, as if it was a measure of success. It is a measure of inventiveness, but it is also an index of economic rigidities. The Government should not simply equate maximising the profits of intellectual property holders with the public good. The question must be asked: cui bono?

It is commonly preferable to enlarge opportunities for small and medium-sized enterprises rather than to buttress the monopoly strength of giant multinational corporations. If we want to generate more jobs, spread wealth, tackle the negative externalities of certain business practices and raise more taxes, it may be preferable to support SMEs as against corporate giants.

The methodology needed to establish the necessary minimum has to be pragmatic and based on an assessment of the benefits and disbenefits of protection in relation to the economy, social well-being, research and culture. There are different effects of intellectual property depending on different timescales, industrial sectors, amounts of market share and geographical scales, just as there are different effects between luxuries and necessities.

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The Government’s vision should not just be of what is in the narrow interest of the United Kingdom. They should not take the view “my country right or wrong” in relation to intellectual property. We should not always reflexively back UK plc. As we move towards a world with a population of perhaps 10 billion people and with vast migrations, it will be enormously in the interests of the United Kingdom that the poorer peoples of the world should be able to make rapid progress in knowledge, education and the growth of their economies. Judgments about intellectual property policy need to be economically farsighted, humane, ethical and wise. They will be very difficult indeed to make in, for example, the burgeoning field of the life sciences and where bioethical issues are at stake. I very much welcome the judgment by the US Supreme Court in relation to Myriad Genetics. However, as the noble Lord reminded us in Committee, it poses a significant challenge to the European Union. The EU biotechnology patents directive may need to be reconsidered in the light of that American judgment. As we see the development of techniques of so-called human enhancement, such issues are likely to proliferate. I hope that, year by year, the annual report will offer discussion of these matters.

The Minister very understandably and rightly said in Grand Committee, at col. 53 of Hansard on 18 June that each annual report should not be “a Hargreaves-like review”. But it should be thoughtful and instructive and should be more than a catalogue or parade of BIS or IPO activities, statistics, lists of negotiations and seminars and an account of assistance given to business. It should articulate values and principles and the Government’s vision. I mean the vision of the whole Government, not just the business department but other departments that have a vital interest in intellectual property such as the DCMS, the Department of Health, the schools department and the Department for International Development.

I conclude by noting that the noble Viscount, as Minister for intellectual property, has vastly important responsibilities which go beyond what is written into the clause as we have it now—that is,

“the promotion of innovation and of economic growth”.

The annual report ought to reflect those wider responsibilities and should be the basis of Parliament’s and the public’s continuing consideration of this policy area, which has such wide significance.

Lord Stevenson of Balmacara: My Lords, I would like to pick up on the points made by the noble Lord, Lord Clement-Jones, about metadata. I endorse his feeling that good work is going on in this area in the Copyright Hub, which I think will bridge a gap between where everybody would like to be and where photographers think we are. I think that a number of steps still need to be taken on that but if the Government will keep a close eye on it and help where they can there is a reasonable expectation and hope that we will find something of lasting good coming out of that. As regards the amendment proposed by my noble friend Lord Howarth, he makes his point with great elegance. I look forward to hearing from the Minister.

Viscount Younger of Leckie: The first amendment in this group from my noble friend Lord Clement-Jones

23 July 2013 : Column 1211

would require that the annual report from the Secretary of State to Parliament include specific mention of,

“progress … made in protecting metadata”.

As I said in Committee, this report will have value to the extent that it addresses issues pertinent to the year in which it is published. While some issues such as innovation and growth are bound to endure, other issues may rise and fall in their topicality.

My noble friend Lord Clement-Jones talked about the work being carried out currently by the industry-led Copyright Licensing Steering Group to develop a voluntary code of practice on the handling of metadata. The Government support the voluntary approach being taken by industry to look at this problem, and we welcome the consultation that was published on 27 June. This consultation exercise, which is indeed good news, ends on 28th August, and I would encourage anyone working in this area to contribute their thoughts. I am sure that noble Lords join me in hoping that this work by industry will mean that metadata stripping is not a significant problem in years to come, and as such I hope they will also agree that although it is topical today, it would not be right to require the Secretary of State to report on progress with the issue every year. Of course, that does not mean that the Secretary of State cannot include such information in the annual report at his discretion while it is both topical and of interest. It is fair to say that, for the initial report at least, that will be the case. Accordingly, I am happy to commit today that the first report will contain an assessment of progress made on this issue.

Amendment 14, tabled by the noble Lord, Lord Howarth of Newport, is intended to require the Government to report on how the activities of the IPO impact on the interests of wider society and the economy. The amendment returns us to the debate which we had during Grand Committee on the detail of what should be included in the Secretary of State’s annual report on innovation and growth. Indeed, the noble Lord tabled a similar amendment at that time. In Committee, I explained:

“I entirely agree with what I believe is the principle behind the noble Lord’s amendment, that the wider interests of society are important in the context of IP rights. I can assure the noble Lord that the report will indicate where other policy objectives have been taken into account, alongside economic considerations—for example, where, say, freedom of speech, public health, or international development considerations have taken priority over economic ones”.—[Official Report, 18/6/13; col. GC 51.]

However, as the noble Lord has returned to the issue today, I return to the Hargreaves review to which the report responds. The review stated that the IPO should focus,

“on its central task of ensuring that the UK’s IP system promotes innovation and growth through efficient, contestable markets”.

The intention of the report is to sharpen the focus of the IPO on this core objective. Broadening the scope of the report would reduce its effectiveness in clearly setting out what the IPO is doing to promote innovation and growth.

However, I reassure the noble Lord that the Government take very seriously the need to balance the protection of intellectual property with the promotion of the wider interests of society and the economy,

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both in the UK and throughout the world. I was delighted to see that international negotiators, including representatives from the IPO, came to an agreement last month on a new treaty to improve access to books for millions of people who are blind, visually impaired or print disabled.

Also last month, the World Trade Organisation Trade-Related Aspects of Intellectual Property Rights Council decided to extend the transition period for least developed countries to comply with the TRIPS agreement until 30 June 2021. This has been government policy since 2011 and is about balancing the potential value of IP policy to least developed countries with the real-life priorities in those countries. The report will include such examples where the interests of wider society have been balanced with economic objectives.

The noble Lord, Lord Howarth of Newport, said that the Government should not rest on the achievements of international agreements. The Government are determined to improve the global IP system so that it benefits the UK and the global economy. I reassure him that we are certainly not resting on our laurels. Whether it is reducing patent backlogs or agreeing transitional periods for least developed countries in TRIPS agreements, we take a global view and seek continuous improvement. In the light of this, I hope that the noble Lord will feel able to withdraw his amendment.

Lord Clement-Jones: My Lords, I thank all noble Lords for their remarks during the course of the debate, particularly about the importance of the protection of metadata. I thank my noble friend in particular for his assurances that the first annual report will include a report on progress on metadata protection. The marvellous thing is that it will be a good news report in that respect. I beg leave to withdraw the amendment.

Amendment 13 withdrawn.

Amendment 14 not moved.

Amendment 15

Moved by Lord Clement-Jones

15: After Clause 20, insert the following new Clause—


(1) A person (“A”) shall not, in relation to any goods or services, use any features of packaging, marking, labelling or decoration in such a way that the public is likely to attribute to A’s goods or services the reputation of another person (“B”) or the qualities or reputation of B’s goods or services.

(2) For the purposes of subsection (1) it is immaterial whether there is any similarity between the goods or services of A and those of B.

(3) Subsection (1) shall not apply to features of packaging, marking, labelling or decoration that are commonplace.”

Lord Clement-Jones: My Lords, I return to an amendment on lookalikes which was first proposed by my noble friend Lord Jenkin in Grand Committee on 18 June. He and the noble Lord, Lord Borrie, from the opposition Benches, made an eloquent case that this kind of parasitic copying was designed to—and did—

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confuse and mislead the consumer, and should have a remedy available to those whose products are copied in this way.

The Minister responded with a number of points on, first, the IPO study, the amendment itself, the Consumer Protection from Unfair Trading Regulations, the Which? report and TRIPS compliance. I will take each of his statements in turn and comment on them. First, the Minister said that the findings of the IPO study,

“were, perhaps surprisingly, fairly equivocal”.—[

Official Report

, 18/6/13; GC63.]

Having now studied the IPO study findings, I believe that they are unequivocal in key areas. The review of existing surveys concluded the following:

“It is clear across all these studies that consumers report making mistakes in what they have bought and in high numbers”.

In addition,

“where the packaging is similar then it appears that more people think the own brand has a common origin with the manufacturer”.

The study also states that,

“as the similarity of packaging increases it becomes more likely that consumers will perceive the quality of products to be the same”.

The study’s own consumer surveys found:

“Increased perceived similarity of packaging to manufacturer brand product packaging of one own brand product relative to another is significantly correlated with higher perceptions (ratings/expectations) of price, quality, suitability for intended use and (marginally) value for money … Substantial proportions (50-60%) of the UK, German and US populations report having purchased a lookalike accidentally or mistakenly at least once or twice … In summary, across the three national samples 5-15% of accidental purchasers of lookalikes rated the purchases as having been of the highest level of disadvantage … to them, and 30-40% rated the purchases as having been of the next highest level of disadvantage”.

The study also concluded that,

“some lookalikes are already unlawful in the United Kingdom as they are contrary to the Consumer Protection from Unfair Trading Regulations 2008”.

Tellingly, it went on to say:

“However, certain lookalikes already being unlawful under the 2008 regulations is of little significance if trading standards (or others) do not have the resources to take action against those breaching the regulations”.

The Minister went on to say that,

“there is a fine line between confusing packaging and the use of ‘generic cues’ to signal to customers”.

Competitors may adopt a category cue—typically this is one design element. The Minister quoted green for mint toothpaste. Nevertheless, each product can be distinct from others carrying the same cue. There is a big difference, however, where competitors set out to mimic a range of features associated with a familiar brand in order to create a similar overall appearance. Where there are borderline cases, the courts should have no difficulty in drawing an appropriate line. They must do so, for example, when determining whether or not a product is a counterfeit.

Category cue arguments are often used to justify copying familiar brands. However it is one thing to say that green equals mint or yellow equals lemon, it is quite another to say that red equals cola or squat, dark bottles equal Marmite. The Minister went on to say that,

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“a substantial majority of consumers had deliberately purchased a lookalike and, of those consumers, most of them found the experience to be advantageous. The research did not analyse why some consumers perceived the purchase to be advantageous”.—[

Official Report

, 18/6/13; GC63-64.]

It should not be inferred from these findings that similar packaging is benign. A copy may be purchased deliberately, in the belief that it is comparable to the brand. This is what the copy intends to convey and the consumer may feel advantaged. However, the consumer would be misled were the copy not to share all the functional and emotional attributes normally associated with the brand. The IPO study demonstrates that similar packaging increases perceptions of quality and price. A consumer may feel advantaged, but actually may be paying more than would be the case were the product not free-riding and boosting its appeal artificially on the back of a brand.

The IPO study also demonstrates that similar packaging increases the belief that the product comes from the same manufacturer as the brand. The consumer may feel advantaged, but is actually misled when the product is not made by the brand owner. As the study states, crucially the research did not analyse why consumers perceived an advantage. It also makes a far-reaching and rather far-fetched assumption that shoppers have perfect information about the products on offer in supermarkets. This is clearly absurd. The finding therefore has little value in policy analysis.

5.30 pm

It should also not be forgotten that some consumers believe that purchasing counterfeits is advantageous to them. Indeed, some buy them deliberately. The Minister went on:

“Although a high number of consumers felt disadvantaged by the accidental purchase of a lookalike, a substantial number saw it as an advantage”.—[Official Report, 18/6/13; col. GC63.]

Suggesting that because some consumers feel advantaged in some way balances those who feel disadvantaged is an unusual approach to policy. It is akin to suggesting that were rogue traders to satisfy at least 51% of their customers, their exploitation of the remainder should not be open to challenge.

The last comment made by the Minister on the study was that,

“only in a limited number of categories was there an association between, ‘a reduction in the sales of the brand leader and an increase in the sales of the lookalike’”. —[

Official Report

, 18/6/13; col. GC64.]

I do not believe that that fairly and accurately represents the IPO study, which actually states in the data analysis that this effect was not proven. The brand owners believe this to be the case because the study used a limited number of products, inappropriate data and poor control products, and were unable to match the sales data to the packaging designs, and the effect of similar packaging could not be isolated from other influences such as advertising promotion, shelf display formulation and the many other factors that affect rates of sale. With similar packaging prompting mistaken purchase and creating false assumptions about the origin and quality of product, there must be a sales effect. Generally on the IPO study, to reiterate, there are significant findings in crucial areas that are conclusive

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such as shoppers buying the wrong product and making mistaken assumptions about the origin and quality of goods. These are underplayed when the study as a whole is presented as equivocal.

The Minister commented on the nature of the amendment put forward. He said that it would prohibit the use of packaging which tells consumers that a product has similar qualities to those of a competitor’s product even where it is true. The amendment, which is in exactly the same form as the amendment moved in Grand Committee, would prohibit only the use of similar packaging to indicate such similar qualities, including reputation.

Quality can be conveyed to consumers in many distinctive ways that would be unaffected by the amendment, such as unique label design, materials, imagery and printing techniques such as embossing and metal foils. If a competitor mimics the brand’s packaging to convey similar or identical qualities, it is not competing on its own merits, but free-riding on the brand’s hard-won reputation. The copy is essentially inferring that the product is similar in every respect. Under comparative advertising rules, such a claim would not be permitted as it is neither objective nor verifiable. Were such a message to be conveyed through words in an advertisement, the advertisement would be banned. Why should the principle differ when the product packaging is the medium, especially as such imagery conveys the false message far more powerfully? The comparative advertising rules, while applying to a wide range of marketing communications, regrettably do not apply to similar packaging. Furthermore, the comparative advertising rules were not considered in the IPO study.

On the second major point under this heading on the amendment, the Minister said:

“The law already provides for the protection of distinctive packaging … First, where packaging is distinctive, it may be registered as a trade mark”. —[Official Report, 18/6/13; col. GC63.]

While packaging may be registered as a trade mark, it would have to be well known to have protection against unfair competition. It is uncertain whether most packaging would be deemed well known, and certainly it would discriminate against small suppliers who were copied. Furthermore, protection by Cadbury, for example, for its purple colour, has been a hugely long and drawn-out process taking many years. In reality, copiers are able to design around registered trade marks while still conveying a similar overall impression. The Minister went on to say that there are,

“remedies under the common-law tort of ‘passing off’”.—[

Official Report

, 18/6/13; col. GC64.]

As the interviews in the IPO study convey, a passing-off action is very difficult and expensive to bring in cases involving similar packaging. Often the pack clearly displays the producer’s name, reducing the likelihood of misrepresentation, and consumer confusion is extremely difficult to prove to a court’s satisfaction. Consumers tend not to complain about low-priced items. Evidence cannot be gathered in stores, and courts often dismiss survey evidence as unreliable. These factors explain why in 2006 the Gowers review commented:

“The review believes that passing off does not go far enough to protect many brands and designs from misappropriation”.

23 July 2013 : Column 1216

The Minister’s final point on the amendment was:

“Any proposal which changes the status quo should be considered with caution”.—[Official Report, 18/6/13; col. GC63.]

This amendment was first tabled in 2000 when my noble friend Lord McNally’s Copyright and Trade Marks Bill was presented to the House. There have been something like 13 years for careful consideration of the amendment. As the IPO study states in relation to the Gowers review:

“This response was criticised by some commentators for largely reflecting the same wait-and-see approach that had been taken when the Trade Marks Act 1994 had been adopted. Such criticism argued that wait-and-see had been used as a strategy for too long”.

That criticism was made in 2006.

Coming on to consumer protection through unfair trading regulations, the Minister said that civil powers to enforce were rejected at that time,

“because of the danger that such powers in relation to regulations with a very broad, principles-based application could lead to a great deal of costly and burdensome litigation before the courts”.—[

Official Report

, 18/6/13; col. GC65.]

This statement appears to acknowledge that there is a significant problem in the UK with many potentially unlawful products on the market. The IPO study indicates that the Government’s fears are groundless. Other countries where civil powers to enforce have been granted to companies have not seen a wave of litigation. The Minister’s second point on the CPRs was that such actions,

“would also need to be based on consumer detriment”.—[


Report, 18/6/13; col. GC63.]

I do not believe that that is the case and it would amount to government gold-plating. There is no consumer detriment test under the CPRs. The IPO study verifies that consumers make mistaken purchases and are misled in significant numbers, with many considering themselves disadvantaged. I appreciate that the OFT and trading standards may wish to adopt a consumer detriment test to determine their enforcement priorities, but this would be less of a constraint on brand owners were they to have civil enforcement rights. The outcome would be higher levels of consumer protection at no cost to the taxpayer.

Penultimately, the Minister dealt with the Which? report by saying:

“The Which? survey of 2,244 of its members, conducted in February of this year, also found that of those who had mistakenly purchased the lookalike product, 38% were annoyed by the fact and 30% felt misled. However”—

this was the Minister’s point—

“the survey also reported that 18% of participants had deliberately purchased an own-brand product because it resembled a branded product, some of them because it was cheaper than the branded product. Taken together, the Government consider that these measures grant a proportionate level of protection to the packaging of brand owners and that therefore the amendment is not necessary”.—[

Official Report

, 18/6/13; col. GC65.]

This Which? finding should not be taken at face value—it refers to only 18%. A consumer may deliberately purchase a copy, but may still be misled over its source and/or its quality.

Finally, the Minister responded to the point on the TRIPS agreement and the Paris convention. He assured me,

“that the UK is fully compliant in its obligations under TRIPS and other international agreements.—[

Official Report

, 18/6/13; col. GC65.]

23 July 2013 : Column 1217

In response to a Parliamentary Question in 2000 from my right honourable friend Norman Baker, the Government were unable to substantiate that the UK complies with its obligation to give nationals effective protection against unfair competition. This is a requirement under the Paris convention and TRIPS. In the same year, Christopher Morcom QC reviewed all the documents referred to in the Answer, but could find nothing that was relevant to the UK’s compliance. In 2006, the Gowers review of the UK’s IP regime, undertaken at the behest of the Treasury, found that brands in the UK are not well protected from misappropriation. The review was accepted by the then Government.

Other than this reply, I am not aware of any substantiating evidence from the Government of the UK’s compliance, only assurances such as those that were given by the Minister on 18 June. The IPO study suggests that the protection required by Article 10bis of the Paris convention is now met by the UK’s implementation of the unfair commercial practices directive through the CPRs. This statement ignores the reality of the fact that the CPRs are not being enforced by the OFT or trading standards. Without enforcement, the CPRs cannot be deemed to meet the “effective” threshold required by the Paris convention.

I hope that, in the light of what I believe is a comprehensive rebuttal of the points made by the Minister in Grand Committee, the Government will reconsider their position on lookalikes and on this amendment. I beg to move.

Lord Stevenson of Balmacara: My Lords, the noble Lord, Lord Clement-Jones, has gone through the case originally made in Committee together with the Minister’s response. He has done it in some detail, so I do not want to delay the House going forward further. I should just like to pick up on two points.

It is certainly true that, as the noble Lord said, lookalikes are to a large extent already unlawful in the United Kingdom because they are contrary to a variety of measures introduced by previous Governments—in particular, the Consumer Protection from Unfair Trading Regulations 2008. The point that he made—and I think that it is important—is that these regulations are of little effect if the responsible authorities, such as trading standards, do not have the resources to take action against those breaching the regulations. Therefore, the point that the noble Lord makes, and I support it, is that we need a bit more detail from the Minister when he responds on whether it is true that trading standards are able to deliver on this point.

The noble Lord also mentioned that there was a fine line between confusing packaging on the one hand and the use of generic cues to signal to customers. This was something that the Minister gave us examples of when he spoke in Committee. However, the point here is that, if similar packaging prompts mistaken purchases and creates false assumptions, there must be a sales effect. If there is a sales effect, then it is surely right for the Government either to strengthen the existing powers so that they are effective or to introduce new legislation.

Viscount Younger of Leckie: My Lords, the effect of the amendment put forward by my noble friend Lord Clement-Jones would be to protect the distinctiveness

23 July 2013 : Column 1218

of product packaging. Noble Lords will be aware that the amendment reflects the one tabled by my noble friend Lord Jenkin in Committee, which was mentioned by my noble friend. I thank my noble friend Lord Clement-Jones for his detailed and eloquent introduction to the amendment. Indeed, his and other noble Lords’ contributions in Grand Committee caused me to reflect at some length in the interim. This reflection has reinforced my understanding that the Government are committed to protecting intellectual property.

Like my noble friend, the Government recognise the importance of brands. In recent years the Government have held two brands conferences and established the Brands Industry Forum—a vehicle for brand owners to discuss directly with the Government the policy issues that matter to them. The research on lookalike packaging, which I spoke about when we discussed this issue during Grand Committee, was commissioned by the Government in response to concerns raised by brand owners. This demonstrates that the Government are receptive to the needs of brand owners and willing to explore their concerns. However, we also have a duty to the public and wider economy. It is on this basis that the Government will be resisting the amendment. We consider that it would impact on competition and risk damaging future growth.

I now propose to set out the key issues in more detail. First, as I said during Committee, protection for brands already exists through the IP rights of trade marks and registered designs, and through the tort of passing off. A trade mark is a very powerful monopoly right—the most important identifying feature for any brand. It can last in perpetuity. The first ever trade mark registered in the UK, the Bass red triangle and motif, is still in use nearly 130 years later. If packaging is distinctive, it can be protected as a trade mark.

Secondly, registered design rights protect the appearance of a product if it is novel, has individual character and is not dictated by technical function, which I hope my noble friend agrees would be necessary elements of distinctive packaging. Thirdly, passing off protects one trader’s goods from being represented as those of another. An act of passing off requires existing good will in the goods, a misrepresentation causing confusion as to the origin of the goods and likely damage to the good will from this misrepresentation. These three aspects address the issues that lookalike packaging is suggested to cause, so it is logical that redress is sought through this existing mechanism.

5.45 pm

Passing off is an effective remedy when a competitor’s packaging has strayed too close to an existing brand. An example is the Jif lemon case, where highly distinctive packaging in the form of a plastic lemon was found to indicate that specific brand of lemon juice to consumers. More subtle imitation resulted in passing off in United Biscuits v Asda. This case, which noble Lords may remember, concerned Puffin and Penguin biscuits. The High Court found that packaging depicting seabirds of similar physical appearance, and with names that were not very different, amounted to passing off. More recently, the threat of a passing off-action was used by Diageo to settle a dispute surrounding its Pimm’s brand.

23 July 2013 : Column 1219

I appreciate that securing the evidence for a passing-off action is not always a straightforward exercise—a point made by my noble friend Lord Clement-Jones. However, from the successful cases that I have cited, it is clear that it is possible to obtain redress. It is right, however, that the courts set a testing evidential burden because the remedy is so powerful. On this basis, I hope that my noble friend will agree that the answer cannot be to side-step this evidential burden by creating a new right that is less rigorous.

My second reservation is founded on the difficulty encountered in defining a lookalike product. Lookalikes are said to mimic the look and feel of the branded product on a wide range of features such as colour, shape, wording, logos, iconography and layout. The question is: how many features have to be present or how strong do they have to be to form a lookalike? This can often be a subjective judgment—something that brand owners admitted when speaking to the researchers who conducted the lookalike packaging research. One brand representative interviewed described identifying a lookalike as,

“an art and not a science”.

Another admitted that drawing the line between similar packaging and a lookalike was,

“very difficult, and very subjective”.

Furthermore, consumers surveyed for the research did not consider that any of the 12 products identified were a good example of a strong lookalike.

That illustrates the uncertainty inherent in the identification of lookalikes. Translating this into statute is likely to create a right that is unfocused and too widely drawn. The challenge has always been to find a remedy that is effective but also targeted, and I do not believe that the amendment would meet these requirements. It would create an ill-defined property right—neither a trade mark, copyright nor a registered design but appropriating elements of them all. The creation of such an all-encompassing right, if it were deemed to be desirable, would require extensive consultation with industry, given its potential impact. However, even without a consultation, it is a reasonable assumption that requiring businesses to add this opaque assessment to product development would lead to increased costs, deterring investment. The clear risk is that such a broad right would create anti-competitive monopolies for brands.

My final reservation concerns the currently available evidence surrounding lookalikes. It does not point to a clear course of action. Much research has been carried out but the economic impact of lookalikes remains unclear. There is some evidence of consumer benefit through increased innovation, greater choice and multiple price points, but balanced against this is a slight suggestion that brand owners may suffer lost sales, although the picture is mixed. Furthermore, while brand owners may incur increased research and development costs, they benefit from the resultant innovation. It is therefore difficult to conclude that lookalikes harm the economy.

I understand that some interpret this evidence differently and we welcome the discussion. However, we are clear that legislating as suggested is not justified given the evidence that we have seen to date. That the

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Government cannot support the amendment should not be taken as an indication that we do not have a real and continued interest in the lookalikes question. This remains a complex issue and, in the absence of a definitive answer, it is right that the Government maintain the search for an appropriate policy response. My noble friend can be certain that we will continue to do so. As part of this search, the Government will maintain a dialogue with all interested parties. Indeed, my officials are due to meet the British Brands Group to discuss the issue following publication of the research.

My noble friend Lord Clement-Jones raised the issue that some of the IPO study is fairly unequivocal. Our view is that the findings of the report are equivocal when viewed as a whole. For example, the consumer research found that the lookalike effect is weak and that it varies substantially across product categories. My noble friend Lord Clement-Jones stated that there was no analysis of why people found picking up the lookalike copy to be advantageous. It is fair to say that the consumer surveys were not designed to pick up these points. That is recognised in the report, and the possibility of further work to explore the issue is raised.

My noble friend Lord Clement-Jones also raised the issue of comparative advertising rules and the point that the IPO had not considered applying it to lookalikes. The connection between comparative advertising and lookalikes is an interesting one, and I am happy to reflect further on any possible connection and afterwards to write to my noble friend.

My noble friend Lord Clement-Jones raised the issue of the Which? magazine findings, which should not be taken lightly. However, the Which? report is just one component of the evidence that exists in this area. As I said, the picture is far from complete and more evidence needs to be collected before we act. I hope that that is some reassurance to my noble friend. For the reasons that I have outlined, I fear that this amendment will cast too great a shadow, which is why I ask my noble friend to withdraw it.

Lord Clement-Jones: My Lords, I thank my noble friend the Minister for a very careful and well crafted reply, which had resonance in a number of areas. I particularly appreciated him saying that he and his officials were committed to protecting IP, that the Government are very receptive to the interests of brand owners, and that he had a real interest in discussions with brand owners and in continuing that dialogue. That is very important. I do not think that we are going to get very far in debating equivocal versus unequivocal—that seems to be a tomahto versus tomayto-type debate—but it will no doubt continue nevertheless. That continuing discussion and dialogue is extremely important and the noble Lord, Lord Stevenson, put his finger on it when he said that it could well be that enforcement of the CPRs is absolutely at the root of this. They are not being enforced currently. It may well be that there are some equivalent remedies to the comparative advertising rules that the Minister mentioned and I very much hope that, whichever way it goes, that continuing dialogue bears fruit. In the mean time, I beg leave to withdraw the amendment.

Amendment 15 withdrawn.

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Clause 21 : Recognition of foreign copyright works and performances

Amendment 16

Moved by Viscount Younger of Leckie

16: Clause 21, page 20, line 17, leave out “the Berne” and insert “any Act of the International”

Amendment 16 agreed.

Amendment 17

Moved by Lord Clement-Jones

17: After Clause 21, insert the following new Clause—

“Copyright in broadcast

Omit section 73 of the Copyright, Designs and Patents Act 1988 (reception and re-transmission of wireless broadcast by cable).”

Lord Clement-Jones: My Lords, this is a rerun of an amendment I tabled in Grand Committee. On 18 June in Committee, the Minister said in response to this particular amendment:

“Given the interrelation between Section 73 and many other rules and regulations, it is key that this is looked at in the context of the wider framework”.

He said that the DCMS was essentially leading the work on this and that the department,

“will set out the next steps on this issue when it publishes its approach to digital connectivity, content and consumers, which is planned for publication before the end of July”.

I hope that the Minister can give us some news on that hot off the press but I am not totally optimistic. He also said:

“It is right and proper that any proposal will be consulted on with the relevant stakeholders and interested parties. This proposed amendment to the CDPA would pre-empt the Government’s approach to this area”.—[Official Report, 18/6/13; col. GC 94.]

I set out, fairly comprehensively, the reasons why it was not right to retain Section 73 of the CDPA, largely because of the outcome of the case involving an app that is retransmitting ITV and other commercial—

Lord Foulkes of Cumnock: I wonder whether the noble Lord will give way. He has spoken eloquently and diligently in Committee and now on Report on this matter, as he did on the previous amendment. I wonder whether he could give the House and me some reassurance as to whether there is any link between any of these subjects and the interest that he has declared in the register.

Lord Clement-Jones: My Lords, there is no connection at all. I am very surprised, quite honestly, that the noble Lord is asking that question, since I have spoken on this issue both in Committee and today.

Lord Foulkes of Cumnock: So none of the clients of DLA Piper UK have interests in any of these matters—is that correct?

Lord Clement-Jones: My Lords, none of those clients of DLA Piper are personal clients and therefore I have no obligation either to include them in the register or to declare them when I stand up in the House. I am sure that when the noble Lord reads the Code of Conduct, he will be absolutely clear on that point.

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Lord Foulkes of Cumnock: I was not raising it as a question of obligation or, indeed, challenging what he has properly declared in the register. All I was seeking to ascertain was whether any of the many clients of DLA Piper—personal or otherwise—have interests in these matters. I wonder whether he could clarify that.

Lord Clement-Jones: My Lords, DLA Piper has something like 80,000 clients. I am sure that some of them have interests in virtually everything that passes through this House on a daily basis. However, that does not require a partner in a law firm, like me, to make a declaration or, indeed, to state who their clients are. Otherwise, I would take up even more of the House’s time than I already am. Perhaps I could continue.

The current regulatory regime governing the relationship between PSB channels and TV platforms rests on three assumptions: that some of the analogue terrestrial value enjoyed by the PSBs should be used to encourage platform competition in the UK; that platforms effectively offer audiences to commercial PSBs to sell to advertisers; and that platforms do not inhibit the ability of commercial PSBs to exploit content, originally delivered free to air, in secondary markets.

The first assumption no longer holds—there is no analogue spectrum and there is a highly successful and well resourced pay-TV platform in the UK. Increasingly, however, the second and third assumptions are also in jeopardy, in particular as a result of the rise of subscription-based, high-capacity personal video recorders. PVRs are now in the vast majority of Sky and Virgin households and are key to both platforms’ proposition to consumers. PVRs are rented or sold by the main pay-TV platforms to their subscribers as added-value services and enable pay-TV platform customers to record and keep copies of very significant amounts of commercial PSB content. They also allow viewers to skip the advertising in such content, as they are doing in increasing volumes, particularly in genres such as drama.

For example, the Sky+HD 2TB box is now capable of recording the entire ITV peak-time schedule for 11 months of the year, and storage space is expanding exponentially. The concern is not about PVRs per se—they are a great enhancement to consumer choice—but rather the fact that the regulatory regime now allows platform operators to extract further value from PSB content, which is supplied either for free or, worse still, following payment to the platform operator in the first place. The PSBs are not able to capture any of this value by renegotiating the original terms of supply to the platform, as a result of the following components of the current regulatory regime: Section 73, which this amendment attempts to deal with; the Ofcom-regulated technical platform services regime, under which PSBs have to provide content for free and have to pay several million pounds to a platform operator for the technical platform services that enable viewers to receive the PSB channels; and thirdly, the time-shifting exception to copyright that allows customers to record and keep TV content. Around 10% of all viewing is now time-shifted, which is nearly five times greater than the highest level of time-shifting in the VCR era. PSB content is the most time-shifted—drama in particular, where levels of time-shifting and advertising-skipping are far higher.

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6 pm

I want to deal with some of the arguments made in Committee. The first is that repealing Section 73 would unbalance a delicate equilibrium in the UK broadcasting market. The market is evolving very rapidly as technology changes and convergence continues. In no sense is the UK market in equilibrium, whether technologically or economically. The second argument is that Section 73 ensures that consumers who have already paid for PSB content through the licence fee or indirect taxation can access this content through a cable platform at no additional cost. This is not the case for ITV, Five and, arguably, Channel 4. These are commercial channels with no government funding. The third argument is that Section 73 continues to provide cable subscribers with access to the PSB channels without their having to pay twice. Cable subscribers would not have to pay twice for ITV and Channel 4. As I have described, they do not have to pay even once at the moment. Watching advertisements is really the way that they pay, and that is being undermined by subscription.

A further argument is that the broader channel-platform relationship should be on a level playing field —that is, zero fees either way. Rather than repealing Section 73, a clause should be drafted to ensure zero fees either way. This surely would not be the right outcome. If platforms increasingly enable consumers to skip advertisements, extracting more value from channels and reducing the size of the secondary market for programme rights via subscription PVRs, such as Virgin’s TiVo and Sky+, it will become impossible for the free-to-air channels to sustain investment in high-value content such as drama.

The penultimate argument is that repealing Section 73 would be contrary to the interests of 4 million cable customers who access PSB content, at no cost to those broadcasters, through cable platforms. There is an increasing cost to broadcasters as the TV market continues to evolve. Subscription PVRs generate content for platforms and extract increasing value from FTA content, reducing the opportunity for PSB channels in secondary content markets.

The final argument is that the Government believe that Section 73, properly interpreted, is consistent with EU law. In that case, the UK Government are substituting what they think is the proper interpretation of Section 73 for that of the UK High Court. It was the UK court’s interpretation of Section 73 that the European Commission suggested was in breach of the UK’s obligation under the 2001 copyright directive. Therefore, I am unclear what the words “proper interpretation” might mean. The fact is that the European Court of Justice did not comment on compatibility in its recent judgment because the UK court did not agree to the request by the broadcasters to refer the question to the European Court of Justice in the first place.

We discussed these arguments in Committee, and those are some of the points of rebuttal to the arguments made. I am not sure that we had a particularly enlightened debate last time. I hope very much that the Minister will be able to respond with greater particularity. In addition, I very much hope that he can give some reassurance that this issue is being seriously addressed and will be dealt with when the expected White Paper sees the light of day. I beg to move.

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Lord Stevenson of Balmacara: My Lords, despite the points made by the noble Lord, Lord Clement-Jones, Section 73 of the CDPA 1988 is but one component of a complex web of regulations that provides equilibrium in the UK broadcasting market. It is true that Section 73 is relatively old, created when the cable industry was in its infancy. It is also true that the cable industry is in a different position now. I certainly acknowledge that the catch-up TV case referred to by the noble Lord, Lord Clement-Jones, raises legitimate concerns about the use of Section 73 as a defence for the retransmission of free-to-air channels online.

However, the point surely is that this amendment points out the need to look again at the objective of Section 73 and to ask whether the outcomes it delivers today are still relevant to the Government's public policy objectives. I understand that the Government are currently looking at how Section 73 might be amended and tightened to ensure that the beneficiaries of the clause are the intended platforms that are acting within the law. Perhaps when he responds, the Minister will let us know what progress is being made in that review and indeed, as has been mentioned, what progress is being made on the communications White Paper, which has been promised on a regular basis since 2010.

While the recent catch-up TV case may require an adjustment to the current law, abolishing the clause entirely, as the noble Lord, Lord Clement-Jones, proposes, seems entirely contrary to the interests of 4 million cable customers who access public service content, at no cost to those broadcasters, through the cable platform. The right thing to do is to ensure that this issue will be considered in some detail when the Government eventually publish their communications White Paper. In these circumstances, the amendment proposed by the noble Lord, Lord Clement-Jones, seems somewhat previous, as well as being contrary to consumer interests. I hope that the Government will resist this amendment.

Viscount Younger of Leckie: My Lords, I note the continuing interest that my noble friend Lord Clement-Jones shows in this area. The legislative framework that supports our vibrant and successful TV industry is incredibly important and is deserving of our time and attention. This amendment would repeal Section 73 of the Copyright, Designs and Patents Act 1988. This would remove the copyright exemption for the retransmission by cable of certain public service broadcasts, or PSBs. This issue will be addressed shortly when the Department for Culture, Media and Sport sets out its approach to digital connectivity, content and consumers. I reassure my noble friend that we still anticipate publication of the strategy paper by the end of this month.

This is an area where many competing interests must be balanced. As such, it is of vital importance that the Government proceed carefully, giving each of the opposing views due consideration. I can assure my noble friend that it will be consulted on fully to ensure that the views of all those affected are taken into account. I hope that I might be able to help the development of this debate by setting out some of the key points of discussion and their relationship to key pieces of legislation, including Section 73.

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Discussions about Section 73 tend to focus on two key areas. First, they are concerned with the impact on the relationship between PSBs and cable platforms. Secondly, they relate to the use of the Section 73 exemption by internet-based television streaming services. I will look at each of these areas in turn.

This piece of legislation affects the relationship between PSBs and cable platforms by providing cable platforms with an exemption for the retransmission of certain PSBs. This means that PSBs are not able to charge cable services for the inclusion of certain channels on their services. However, this piece of legislation fits within a much wider framework that supports the availability of TV and investment in television programming in the UK. This framework consists of a variety of rules and regulations that affect the production, availability and ease of discovery of public sector programming and its relationship with the services or platforms that carry it. These include the obligations on PSBs to offer their content to all relevant platforms, the rules governing payments by broadcasters for technical platform services, and the powers for regulators to compel these services to carry PSB content.

The Government have been clear that their objective is to ensure that, for the core PSB channels, there is an overall zero balance of payments between the PSBs and the services or platforms, regardless of whether these are based on cable or satellite. This is a fair and pragmatic approach that ensures the wide availability of PSB content and allows PSBs to continue their high level of investment in high-quality UK content. The current framework, including Section 73, is delivering this outcome for TV delivered by cable, and we want to see this continue. However, there is still a way to go before we see net zero fees on satellite, and we want to investigate how net zero fees can be achieved across the main platforms. Therefore, it is right and proper that any proposal will be consulted on with the relevant stakeholders and interested parties.

The second issue at stake is the use of the Section 73 exemption by internet-based television streaming services. This issue is the subject of ongoing legal proceedings and, as such, it is not appropriate for me to comment on the specifics. However, I can say that the Government are concerned about the use of this exemption in this way, and will address it when we set out our approach to connectivity, content and consumers by the end of this month. This proposed amendment to the CDPA would pre-empt the Government’s approach to this area. A complex framework governs the balance of payments between platforms and broadcasters, so we need to consider any changes in the round or risk unintended consequences.

In view of the fact that the Government are actively looking at this matter, I would be grateful if my noble friend would withdraw the amendment. Just before I sit down, I will answer a question raised by my noble friend Lord Clement-Jones and the noble Lord, Lord Stevenson, about when the communications paper will be published. To reiterate, the Government still anticipate that this will be published by the end of July.

Lord Stevenson of Balmacara: Before the Minister really sits down, perhaps he could unpick that a little. “Connectivity, content and consumers” is to be the

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title of what? Is that a strategy paper, as the noble Viscount mentioned in reply to the noble Lord, Lord Clement-Jones, or is that the White Paper?

Viscount Younger of Leckie: To clarify for the noble Lord, it is indeed the strategy paper, which is due to be published by the end of July.

Lord Clement-Jones: My Lords, I thank the Minister for that response. We have elicited a very useful heralding of the communications White Paper, which the Minister has carefully labelled a strategy paper, so perhaps we are being invited not to expect too much detail. That will be very welcome, since it has been anticipated for quite some time.

The Minister has been very helpful in responding. Clearly, I believe that the discussion about Section 73 is part of an ongoing discussion, which will no doubt take place when the White Paper is consulted on and any Bill comes forward. The Minister talked about the objective to have a zero balance of payments. While that is very helpful in clarification, it is not particularly welcome to the PSBs. The DCMS can expect some argument about that, since the PSBs believe that that means they are at a disadvantage when it comes to the use of their programmes and people inserting advertisements in them for their own benefit and not for the benefit of the public service broadcasters.

I welcome the Minister’s point about the exemption being used by internet-based companies and so on. Again, that tilts the other way in terms of helpfulness. The debate will carry on, I am sure, but this has been a useful canter round the course in anticipation of the White Paper. I beg leave to withdraw the amendment.

Amendment 17 withdrawn.

6.15 pm

Amendment 18

Moved by Lord Clement-Jones

18: After Clause 21, insert the following new Clause—

“Criminal liability

(1) The Copyright, Designs and Patents Act 1988 is amended as follows.

(2) In section 107(4A)(b) (criminal liability for making or dealing with infringing articles, etc) for “two” substitute “ten”.

(3) In section 198(5A)(b) (criminal liability for making, dealing with or using illicit recordings) for “two” substitute “ten”.”

Lord Clement-Jones: My Lords, this amendment was tabled in Grand Committee and I am certainly not going to repeat everything I said in relation to it.

Criminal offences for online copyright theft have maximum penalties of two years’ imprisonment. Criminal offences for physical copyright theft have maximum penalties of 10 years’ imprisonment. This discrepancy came about because the new offences were introduced by secondary legislation using the European Communities Act as part of the UK’s implementation of the copyright directive in 2003. Penalties for new criminal offences introduced by secondary legislation via the ECA are limited to two years’ imprisonment.

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In addition, my right honourable friend Vince Cable’s Private Member’s Bill, which became the Copyright, etc. and Trade Marks (Offences and Enforcement) Act 2002, increased penalties for criminal copyright offences to harmonise them with those available for trade mark offences at 10 years.

Criminal sanctions should not be dependent on whether the offence is taking place in an online or physical environment. Intellectual property is being stolen, whichever format is being used. This amendment is essentially about addressing an anomaly that arose simply because of timing. These are exactly the same offences—they are just being committed online—and therefore should have the same maximum penalties.

Having a maximum penalty of only two years for online offences can be used by defendants to argue that these are not serious offences. Prosecutors have on occasion managed to work around this anomaly by using charges of conspiracy to defraud but it will certainly not always be appropriate to use fraud legislation. The circumstances of the Vickerman case—which we discussed in Committee; he got four years in prison—will not always be repeated. In other cases there may not be a conspiracy or the Fraud Act may not be applicable. Some cases are copyright cases pure and simple but we cannot currently risk using the CDPA in serious cases because of the reasons given above.

In his response in Grand Committee, the Minister said:

“With existing legislation already providing the necessary penalties and prosecutors having a range of options already at their disposal, at the present time I see no reason to increase sanctions under the Copyright, Designs and Patents Act, despite there being a slight discrepancy”—

I would have thought that eight years was rather more than a slight discrepancy. He went on to say:

“In particular, changes should not be made without carrying out the appropriate consultation to gather evidence of the impact”.—[Official Report, 18/6/13; col. GC 98.]

Existing legislation does not provide the necessary penalties. Rather, they are different. Why would it be necessary to consult in these circumstances? I remind the Minister of comments made by my right honourable friend Vince Cable when he was steering his Private Member’s Bill through Parliament. He said:

“There is no logical reason for two sets of intellectual property law to impose different criminal sanctions … it is important that we have legislation that makes criminal sanctions effective deterrents … There are some who have argued that we do not need to change the law because it is possible to find some existing power under which sanctions can be imposed. That is an unsatisfactory way to proceed. The approach is cumbersome and costly, and often it does not work. There is an enormous inherent advantage in having a law that is clear, open and completely honest in what it is designed to achieve”.—[Official Report, Commons, 23/11/01; cols. 628-30.]

All these points are apposite today as regards physical versus digital online copyright infringement. I hope that the Minister will reconsider his position on that amendment.

On Amendment 19, in responding to the Hargreaves review, the Government committed to introducing a limited private copy exception to allow copying of content lawfully owned by an individual for their own personal use. The Intellectual Property Office has

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recently issued the draft private copy statutory instrument, which can be summarised as follows. First, an individual who has lawfully acquired a work on a permanent basis can make a private copy for his or her own personal, non-commercial use. Secondly, the individual cannot circumvent technological protection measures but—interestingly—will be able to appeal to the Secretary of State to intervene to obtain a private copy if the work is protected by technological protection measures. Thirdly, it does not allow contract terms to override the exception.

Amendment 19 inserts a new clause in anticipation of this draft statutory instrument. The draft SI has provoked considerable concern among the audiovisual sector—indeed, across all the creative industries. I strongly believe that copyright exceptions should be adopted only in response to a well defined public policy objective and market failure. In this regard, the Government’s draft statutory instrument disregards altogether consumers’ ever-widening choice of commercial offerings facilitated by a rapidly evolving technological landscape, and risks jeopardising these market-led developments altogether. The purpose of this amendment is to ensure that a private copy exception should not apply where a commercially available alternative already exists. This principle is entirely consistent with European and international copyright norms and, indeed, is an existing principle in UK law.

Historically, private copy exceptions were established in an analogue environment where business models and technology could not accommodate consumer offerings that provide secure copies. With the rapid conversion to digital business models in recent years, the technological and therefore the commercial landscape has changed considerably. The audiovisual sector has recognised the growing consumer demand for additional copies and portable content, and already provides many avenues for consumers to obtain legal digital copies of content they buy for their own use. Most commonly, the purchase of a DVD or Blu-ray Disc includes access to a digital copy. In addition, products such as UltraViolet allow legal and secure access to that content through the cloud among six family members for up to 12 personal devices such as laptops, tablets, smart phones and televisions, thereby enabling format shifting. Additional multicopy offerings are being brought to the market, and none requires the consumer to pay twice for the same content. At the same time, an explosion of new digital audiovisual services—currently there are more than 30 in the UK—has occurred under the existing legal framework. There are an increasing variety of means which put increased choice and control in the hands of the consumer, and are made possible only through industry-led investment and innovation.

The UK already leads Europe in its range of audiovisual services and technologies, without any change being required to the current legal framework. In proposing the introduction of any copyright exception in the absence of a clear public interest, surely the burden of proof should rest firmly with the Government to define and quantify the extent of the market’s failure to meet consumer needs. It is very questionable whether the Government have made a convincing argument in support of a private copying exception. Indeed, far from incentivising the market to continue

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innovating in the interest of the consumer, it may be that the private copy exception proposed will fundamentally undermine the technologies and services that the market is developing.

There are numerous other concerns expressed about the draft copying statutory instrument, not least its apparent conflict on a number of points with EU law. It needs to be strengthened to ensure that the exception applies only for the sole personal use of an individual and is not to be used by commercial operators. It should not authorise the making of a further copy by another person or entity, such as an electronic storage provider, in relation to a further copy. Without such clarification, the exception could seriously impact on the ability of the music industry to license innovative value-added services, such as “scan and match” services in the cloud.

Given the widespread concerns about the latest wording of the exception, I hope the Minister can assure us that a further draft will be presented before the formal publication of the SI. I had a letter today from the Minister saying that the SI may be tabled later on in the year but that it is not intended to bring it into force until 2014. So there is no rush; there is ample time for another draft before proceeding with implementation. However the purpose of the present amendment is to ensure that, where private copying is permitted under the terms of the original product purchase, the exception is not invocable. There is no doubt in my mind that the absence of any commercial availability test when applying a private copying exception would be incredibly damaging for the health of our audiovisual sector. I beg to move.

Lord Stevenson of Balmacara: My Lords, this group is in two quite separate halves. Amendment 18—to which the noble Lord, Lord Clement-Jones, spoke first —is the continuation of a debate that was held in Committee. It will be interesting to hear how the Minister wishes to respond to it. There is a good case here for trying to unpick some of the discrepancies between the various regimes, and in particular to try to anticipate the way in which technology is moving forward.

In Amendment 19, which has been linked in this group, we are hearing a different debate, which is about the Hargreaves exceptions which are currently in consultation. As the noble Lord obviously anticipated, some changes may well occur as that debate goes forward. However, I do not think that it fits well into this Bill and confidently expect the Minister to say that it is a matter for another time. The question, of course, is when.

At the conclusion of the Committee stage the Minister offered—and we gratefully accepted his invitation—to have a broader-based debate around the sort of issues that the noble Lord, Lord Clement-Jones, has been raising. We felt that the recourse to secondary legislation for this important issue in itself makes it difficult for the House to exercise a broader view on these matters. In particular, as there are so many of these exceptions, there is a need for what might be considered a more general debate around the overall balance and overall approach which the Government could have taken in this matter. The noble Lord made that offer and we look forward to hearing whether he has had any success in finding time for that debate. It would be helpful, for exactly the reasons that the noble Lord,

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Lord Clement-Jones, has given, to have a broader-based discussion around some of the more far-reaching ends of these 11 different exceptions so that when the time comes for both Houses of Parliament to consider these matters—as they will in the secondary legislation process—we are better informed and can make better decisions about how to respond to them. I look forward to hearing the Minister’s response.

Viscount Younger of Leckie: My Lords, Amendment 18, tabled by my noble friend Lord Clement-Jones, would increase the maximum penalty for online copyright infringement to 10 years. Under the Copyright, Designs and Patents Act—CDPA—the current maximum penalty that can be incurred by online copyright infringement is two years, while for physical copyright infringement, the maximum penalty available is 10 years. This is not a new proposition. A similar recommendation was made by Andrew Gowers in the report he wrote for the previous Government. At the publication of the Gowers report, the previous Government indicated their intention to implement all of its recommendations. However, after a consultation, they decided to increase the financial penalties to £50,000 but left the maximum custodial sentence untouched. I am sure that they did not reach their conclusions on this matter lightly.

This issue is sometimes presented as if there is a gap in the fabric of criminal offences which apply in this area, and that this change will plug that gap. I am not entirely convinced. The statute in question is not the only way in which criminals can be charged for copyright infringement. There is already a range of options for prosecutors looking to obtain a conviction for such activities. Many of these require a lower evidential burden than copyright offences, require less specialist knowledge and offer the sort of sentencing options which my noble friend seeks to add to this offence. Indeed, I am told that prosecutors would usually prefer to charge under the Fraud Act 2006, which carries a maximum penalty of 10 years, or use “conspiracy to defraud”, which also carries a penalty of 10 years. The Fraud Act in particular seems to have met the challenges posed by developments in technology and internet crime, helping industry to report crime as fraud, and has garnered praised from the City of London Police, among others.

There is another issue here of sentence length, by which I mean convictions and sentences actually handed down, rather than those that are theoretically available. The average custodial sentence given for physical copyright infringement under CDPA offences in 2011 was 12.7 months, the highest for five years. So the questions that occur to me are these: is this a necessary change? Is it a useful change to make? I would like to reflect on this matter further, and perhaps have the benefit of views from experts and practitioners in the field. I therefore ask my noble friend if he would be prepared to withdraw his amendment in return for an assurance that I will set in hand a study of this question, the timing of which I will confirm following the Summer Recess. If there is a need for a change to the law then I will, of course, look for a suitable legislative opportunity.

I turn now to the private copying exception, to which Amendment 19 relates. This is a measure that the Government are preparing to introduce under

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secondary legislation, separate to this Bill, as the noble Lord, Lord Stevenson, pointed out. I remind noble Lords of the lengthy Committee discussions which have already been held on copyright exceptions, and of the detailed information already provided to this House on the Government’s ongoing technical review process. Noble Lords will recall my invitation for contributions to that process from all interested parties. I am very grateful for the contributions we have received to this review process so far. I also remain committed to having further debate on these issues prior to the draft regulations being laid before Parliament. The noble Lord, Lord Stevenson, asked when the exceptions debates might take place and about the timing. I believe that we agreed that the timing would need to be agreed through the usual channels. I would like to await the results of these discussions first before I commit to a particular time.

In light of all this—and I am sorry to strike a rather discordant note—I will admit that I am surprised, and slightly disappointed, to see that my noble friend Lord Clement-Jones has chosen to lay this amendment on private copying, on Report, on one of the proposed changes to copyright exceptions. It is rather late in the day for an amendment that would add a new clause to the IP Bill, and appears to ignore the many opportunities there have been to debate the private copying exception. However, I will endeavour to provide my noble friend with some reassurance in the interim.

6.30 pm

By introducing a copyright exception for private copying, it is the Government’s aim to give consumers greater certainty over what they can do with products they have bought. It will not allow people to bypass commercial markets to acquire products for free. Instead it sets out basic rules on how people can use copies that they have already purchased lawfully. The new law will allow people to make further copies for their own personal use but will not allow them to give any such copies to other people. To that extent, the new exception will be very narrow—the narrowest in Europe. It will only grant very basic permissions that are necessary to allow reasonable consumer use.

Consumers in other common-law countries, such as Australia and Canada, already benefit from similar laws, as do consumers in most of Europe. In many ways, we are only playing catch-up by giving British consumers some of the advantages people already enjoy in many countries around the world. The proliferation of licences online has created even greater confusion for consumers. Consumers deserve basic rights, set out in law, to use the things they have bought without having to deal with multiple and complex licences. The approach set out in this amendment, which foresees a greater role for licences, risks undermining that principle. The Government’s view is that this narrow private copying exception will, first, make life easier and simpler for ordinary people; secondly, remove unnecessary regulation from businesses; and thirdly, help our copyright law catch up with the rest of the world.

My noble friend Lord Clement-Jones asked why consultation would be necessary. It is important that the Government take a proper look at what the impact

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of increased sanctions would be. An increase in prison sentences of eight years is a serious one and the decision needs to be given the appropriate level of consideration and be based on the right evidence. Making changes such as those in the first amendment without first assessing their impact can often lead to a complex and confusing statute book that is unable to respond to new crimes as technology and techniques advance. In view of that, I ask my noble friend to withdraw his amendment.

Lord Clement-Jones: My Lords, I thank the Minister for his two replies, which were rather different in their tenor. I very much welcome some of the points he made in his reply to Amendment 18. While not necessarily agreeing that it is inappropriate to change the penalties available for online infringement, the Minister said he would reflect further, set in train a review and consult with experts on this subject. That gives us a chink of light. He said that he would advise later on the timing of that review. At this stage, with noble Lords gathering for the next debate, that is as good as it gets.

Amendment 19 should be treated as a preliminary canter. I very much hope that there will be a more extended debate on this. This is the problem with secondary legislation: we may be faced with a debate simply when the order comes and we will not be able to amend it in any shape or form. The Minister should know that there is very deep disquiet about the private copying exception among various members of the creative industries. I hope that he will keep channels open to them because there is basically a fundamental difference of opinion here. Some members of those creative industries believe that their interests are threatened by the private property exception as proposed. They believe it is not narrow but actually quite broad and not explicit about the cloud. They have considerable interest in further discussion.

I hope that the Minister will keep all his channels open in that respect—on the exceptions as a whole but on the private property exception in particular. In the mean time, I beg leave to withdraw the amendment.

Amendment 18 withdrawn.

Amendments 19 to 21 not moved.

Arrangement of Business


6.35 pm

Lord Ahmad of Wimbledon: My Lords, there are 24 speakers for this evening’s debate. If Back-Bench contributions are kept to less than five minutes, this should allow for the Question for Short Debate to commence at approximately 9 pm.

EU: Police and Criminal Justice Measures

Motion to Agree

6.36 pm

Moved By Lord McNally

That this House considers that the United Kingdom should opt out of all European Union police and criminal justice measures adopted before December 2009 and should seek to rejoin measures where it is in the national interest to do so; endorses

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the Government’s proposals in Cm 8671; and invites the European Union Committee to report to the House on the matter before the end of October, before the Government opens formal discussions with the Commission, Council and other Member States prior to the Government’s formal application to rejoin measures in accordance with Article 10(5) of Protocol 36 to the Treaty on the functioning of the European Union. 13th Report of the European Union Committee, Session 2012-13 (HL Paper 159).

The Minister of State, Ministry of Justice (Lord McNally): My Lords, today this House has the opportunity to debate and vote upon the Government’s proposal to: opt out of all pre-Lisbon police and criminal justice measures; invite various parliamentary committees to issue reports on the list of measures applicable; and then begin formal discussions with the European Commission and the other member states.

It would perhaps help our deliberations if I begin the debate by providing a little context. Between 1995 and 30 November 2009, some 130 measures in the field of police and criminal justice measures were adopted in Brussels under the so-called third pillar. These were not subject to either Commission enforcement powers or the full jurisdiction of the European Court of Justice. As a result, the Commission could not take action where it considered measures had not been properly implemented. There were no ECJ infringement rulings and unanimity was required to pass decisions in Council. The Lisbon treaty changed the constitutional structure of the European Union in police and criminal justice matters. A five-year transitional period was negotiated to delay these pre-Lisbon measures from becoming subject to Commission enforcement powers and the full jurisdiction of the European Court of Justice. This transitional period applies to and will end for all member states on 1 December 2014.

However, the previous Labour Government negotiated a provision that applies only to the United Kingdom. Under the terms of the Lisbon treaty, the United Kingdom has until 31 May 2014 to decide whether to opt out of around 130 justice and home affairs measures covered by the treaty. If the UK so chooses, the opt-out will come into effect on 1 December 2014. An opt-out of individual measures may have been preferable—I believe that was what the previous Government initially tried to negotiate—but that is not an option. The opt-out can be exercised only en masse. Only after we have opted out can we seek to rejoin individual measures. That is subject to a negotiation with the European Commission and other member states.

Two weeks ago, I repeated in this House a Statement made by my right honourable friend the Home Secretary to announce the list of 35 measures that the Government will seek to rejoin—those being in the national interest to do so. Command Paper 8671 outlines this list of measures and includes the Government’s Explanatory Memoranda on the full set of measures. I want to make clear that the Government are strongly committed to the set of 35 measures in the Command Paper and to a successful negotiation of rejoining these measures.

I am aware of concerns about the difficulty of opting back into some of the more important measures. For example, it is clearly not in the interest of any

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parties to have operational gaps for those subject to a European arrest warrant or any of the other measures that we seek to opt back into. These matters will be discussed further with the Commission. It is our intention to try successfully to resolve any issues in that regard but, because there is much to consider and much at stake, the exercise of the opt-out must be preceded by careful and intelligent analysis of the 130 or so measures covered by this exercise.

The Government have approached the question of the measures we should seek to rejoin from the perspective that our citizens should not have fewer protections after 2014 than they have now. We have listened to the views of law enforcement and other agencies that operate on the front line to keep our country safe. The piece of work we have put before both Houses is the result of that careful analysis. We want to continue to co-operate with our European partners where there is value in doing so—where it is in the national interest to do so. That commitment is reflected in the 35 measures listed in the Command Paper that we ask the House to endorse today. As a package, they enable co-operation over invaluable practical measures to aid our police forces and criminal justice system. These measures are a crucial tool in the fight against international crime and terrorism.

However, other measures in the original 130 are not so useful: they may be obsolete, defunct or simply unused. That is why the Government’s thinking on this issue has focused on the practical use of measures and whether we consider them valuable in the fight against crime and terrorism. This is why, for example, the Government wish to seek to rejoin the European arrest warrant. With free movement through the European Union, we clearly need strong extradition arrangements in place to see that justice is done. The record shows that since 2009, the arrest warrant has been used to extradite from the United Kingdom 57 suspects for child sex offences, 86 for rape and 105 for murder. In the same period, 63 suspected child sex offenders, 27 suspected rapists and 44 suspected murderers were extradited back to Britain to face charges. A number of these suspects would probably have never been extradited back to Britain without the arrest warrant.

The arrest warrant has transformed the extradition process within the EU from one that typically took years to a system that now takes weeks. A perfect example of this is the extradition of Hussein Osman, one of the failed July 2005 bombers, from Italy to the UK in just eight weeks. This is in contrast to the era before the arrest warrant, when it took a decade to deport terrorist suspect Rachid Ramda to France. Such success would have been unthinkable in the absence of EU police co-operation. As noble Lords and others have said, the functioning of the arrest warrant can be improved. The Government recognise this and the Home Secretary has already announced a proposed list of changes in the other place.

Another measure that the Government have also expressed a wish to rejoin is the European supervision order. This will improve the functioning of the arrest warrant by allowing suspects, in the appropriate circumstances, to serve their bail conditions in their country of residence, rather than remaining locked up

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in a foreign jail awaiting trial. Furthermore, we want our law enforcement agencies to continue to be able to establish joint investigation teams in order that offenders can be brought to justice as effectively as possible. One example of this is Operation Fry. This saw a joint investigation team with the Netherlands target the abuse of free movement through sham marriages. To date, this has led to 122 arrests, with 77 convictions and sentences totalling more than 100 years, and allowed us to initiate action to remove non-EEA beneficiaries of such sham marriages from the UK. That sort of co-operation would be infinitely more difficult as part of bilateral arrangements rather than as part of a wider EU framework of agreements.

We also want to rejoin Eurojust and measures aimed at fighting child pornography and other crimes that occur across borders. These measures offer a crucial method of combating cross-border crime with other member states.

On another front, I am sure all noble Lords want to see as many foreign national offenders as possible removed from the UK. The prisoner transfer framework decision provides for non-consent-based transfers throughout the EU. The Government support both the principles underpinning this measure and the measure itself, as an effective means of getting those who have abused our hospitality out of Britain to serve their sentences back where they came from.

Then there are measures such as the Naples II convention and the customs information system, which allow us to co-operate and gain access to information from across Europe that makes a real difference on the ground, such as the seizure of 1.2 tonnes of cocaine with a street value of up to £300 million that came from information received under the convention. There is also the second generation of the Schengen information system, a new way of sharing law enforcement alerts throughout Europe, which has the capacity to bring significant savings to our criminal justice system, as well as making it easier to identify foreign criminals and terrorists. The Government have been very open about their wish to connect to this database, which requires us to rejoin the police and criminal justice parts of the Schengen convention itself.

These are but a selection of the instruments that the Government believe it is vital to opt back into. The Government have done a lot of work to prepare the Command Paper and it outlines our strong commitment to measures to facilitate cross-border law enforcement. The Minister for Europe committed to a debate and vote in both Houses of Parliament. Not only do we want a debate and vote, however, we also want consultation with the committees. In inviting the committees both in this House and in the other place to submit reports, the Government are ensuring that Parliament is fully involved in the decisions taken.

Although the Command Paper outlines the Government’s current thinking, we will not begin formal discussions with the Commission and member states until after Parliament has had the chance to express its views. That is why today’s Motion from the Government also invites the appropriate committees to contribute to an analysis of the measures. The committees in the

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other place were invited to do the same in last week’s debate. The result of this process will inform the Government’s formal negotiations with the European Commission and the other member states.

6.45 pm

While talking about scrutiny, I want to thank the European Union Committee of this House for the production of such a comprehensive and thoughtful report on this matter. The committee’s chair, the noble Lord, Lord Boswell, and the two sub-committee chairmen when the report was drafted, the noble Lord, Lord Hannay, and my noble friend Lord Bowness, have done us all a service by their work. I look forward to seeing the outcome of the further work of the committee to scrutinise the set of measures the Government believe it would be in the national interest to seek to rejoin.

When repeating the Home Secretary’s Statement two weeks ago, I made clear that the process ahead would be one of open debate and scrutiny, not smoke and mirrors. The full list of 130 or so measures has been available for all to see and scrutinise throughout this process. As this decision under Protocol 36 is triggered only once, we will want to make sure that we make the right decision ahead of the notification deadline of 31 May 2014. As I said, Parliament’s role in this decision will be key. That is why the Government are proposing this Motion today, as it did a week ago in the other place.

Finally, let me clarify the position on Europol: the Government fully support our participation in Europol, the advantages of which self-evident. It is led by a British director, Rob Wainwright, and in 2012 law enforcement agencies of the UK were involved in more than 300 of the 600 major operations against serious and organised crime and terrorism supported by Europol. These included a variety of serious crimes, including Operation Golf, which broke up an international child-trafficking gang operating in Ilford and led to more than 100 arrests.

However, the new Europol proposal, which is subject to a separate, individual opt-in decision not related to Protocol 36, poses some challenges. It includes a proposal to change the powers of Europol, potentially allowing it to direct national police forces and to require intelligence crucial to our national security to be shared with it. These powers are not necessary and the Government would like to see them removed from the new proposal. That is why we have chosen not to opt in at the beginning of negotiations, but we are committed to opt in at the end, once our concerns have been addressed. I reiterate that continued UK involvement in Europol is vital to keeping our citizens safe and combating the scourges of cross-border crime.

In this and the Protocol 36 measures, the Government have put their cards on the table. They are involving both Houses in both the analysis and the debate about the decisions we have to take. I believe that the approach set out by the Government in our Motion is a sensible way forward and I commend the Motion on the Order Paper to the House.

Lord Maclennan of Rogart: Before my noble friend sits down, will he give us a categorical assurance that the opt-out will not result in a referendum or referenda

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having to be held in respect of what the nation has to opt back into? It appears that the opt-out moves responsibility and competences back to this country, whereas the opt-in would move them to the European Union and it might fall foul of the Government’s own Act.

Lord McNally: My Lords, that is hypothetical and we could spend the rest of the night on it. I have made a very clear statement of government policy, and it does no service to the House at all for hypotheticals such as that to be thrown across.

6.51 pm

Amendment to the Motion

Moved by Lord Hannay of Chiswick

To move, as an amendment to the above Motion, to leave out from “House” to the end and insert “declines to give an opinion on the block opt-out under Protocol 36 to the Treaty on the functioning of the European Union until such time as the Government have (1) given a detailed written response to the Report of this House’s European Union Committee EU police and criminal justice measures: The UK’s 2014 opt-out decision (13th Report of 2012–13, HL Paper 159), and (2) sought endorsement for the list of measures the United Kingdom should seek to re-join set out in Cm 8671”.

Lord Hannay of Chiswick: My Lords, before I address the procedural issues covered by the amendment to the Government’s Motion that stands in my name on the Order Paper, I would like to make some observations about the substantive issues raised by the Home Secretary’s Statement of 9 July and the introduction to this debate by the noble Lord, Lord McNally, which set out the Government’s intention to trigger the block opt-out under Protocol 36 of the Lisbon treaty and to seek to rejoin 35 of the measures that fall within the scope of that opt-out. In doing so, I do not speak in the name of the sub-committee on home affairs, health and education that I chair since, lamentably, due to the Government’s delay in replying to the recommendations in the EU Select Committee’s report of 23 April, that report is not formally part of today’s debate, so I speak in a personal capacity.

The subject matter of our debate is, I fear, formidably complex and difficult to address in a simple and straightforward way. Just in case anyone is inclined to blame these complexities on the fearsome Brussels bureaucracy, though, I should point out that the complications are entirely of our own making. No other member state is in such a quandary. It is legitimate, I think, to criticise the previous Government, who negotiated the Lisbon treaty, for leaving such a cat’s cradle to their successors. I suggest that the challenge we face in this debate is to sort out the wood from the trees, tempting though it is to linger over some of the individual trees—for example, the Government’s decision to opt out irrevocably from the measure dealing with xenophobia and racism, surely a bizarre choice that could be considered sinister, just plain silly or a combination of both. It is a trifle difficult to explain or defend.

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The first salient point that I would make is that the Government clearly have no objection of principle to the extension of the jurisdiction of the European Court of Justice and the enforcement powers of the Commission to cover justice and home affairs matters. Why otherwise have they opted into a large number of the post-Lisbon measures adopted in the past three years, as well as the 35 pre-Lisbon ones that they now say they are seeking to rejoin? No doubt, as the Minister has said, it is in our national interest to do so, but why then deny those extensions to the European Court of Justice and the Commission in the case of rather a large number of less significant measures? Presumably, that is to placate their critics on the wilder shores of Euroscepticism. However, they have obviously not succeeded in doing that, since some of those critics want to rejoin nothing and quite a few of them actually want to repatriate the post-Lisbon opt-ins as well.

A second salient point emerges from a study of the Explanatory Memorandums provided in Command Paper 8671. In not a single instance is it suggested that a measure currently in force is damaging to the national interest, or would be damaging if the Court’s jurisdiction were extended to cover it. The Explanatory Memorandums also state that not a single one of them impairs the human rights of British citizens. Why then do the Government want to opt out irrevocably? The most that can be said is that it would not make much difference. However, I suggest that that is a singularly feeble basis on which to found negative decisions that could have far-reaching implications for our wider relationship with the other member states. I should add that in the course of taking evidence we asked all our witnesses, some of whom were strongly in favour of the block opt-out, whether they could identify a single measure that was damaging to the national interest, and they could not do so.

It is sometimes suggested that to accept the European Court of Justice’s jurisdiction would be to undermine fatally the basis of our common-law system. Not one of our legally expert witnesses could substantiate that, and most of them contested it vigorously. There are, after all, three other member states that have common-law systems—Ireland, Cyprus and Malta—and they do not seem to be feeling any stress. Much is made of the so-called judicial activism of the European Court of Justice, but an examination of its track record in the justice and home affairs field provided no evidence at all for those assertions. In fact, the treaty requires the Court to pay proper respect to national jurisdiction in these criminal justice matters, so it is perhaps not altogether surprising that it actually does so. However, that seems to be overlooked by the Court’s critics.

If so far I have been rather critical of the Government’s position, let me say how much I welcome their decision to seek to rejoin Europol, Eurojust and the European arrest warrant. To have done less than that would have been to have put at serious risk important aspects of our national security—I was glad to hear the Minister recognising that quite explicitly—not least those relating to our greatly improved and crucial relationship on these matters with Ireland. We looked carefully at the assertions that we could comfortably move to a network of bilateral arrangements, in place particularly of the European arrest warrant, but we found no merit in

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that approach, which would in all likelihood be slower, more costly and less effective than the European arrest warrant.

The Government’s intention to implement the European supervision order is also very welcome. As the Minister said, that will enable British citizens sought under an arrest warrant to be bailed here rather than held abroad for long periods awaiting trial, one of the most justified criticisms of the arrest warrant. The fact that this country missed the deadline for implementing that European supervision order, which expired last December, should be a cause of shame for the Government, and the sooner that it now comes into force the better.

Where does that leave the debate over whether Britain should make use of the block opt-out, which it is undoubtedly entitled to do under the provisions of the Lisbon treaty? Nothing contained in the Home Secretary’s Statement in the other place on 9 July, in the Explanatory Memorandums published in Command Paper 8671 or in what the Minister has said today seems to justify a change in the judgment that your Lordships’ Select Committee reached last April: that the Government have not yet made a convincing case for triggering the opt-out. Indeed, the Government’s recent decision to ignore the views expressed by this House on 1 July, and therefore not to opt in from the outset to the negotiations on the new post-Lisbon Europol regulation, further undermines the credibility of the Government’s approach and further increases the potential risks to our national security.

What is new is that the Government have now, very belatedly, revealed the list of 35 pre-Lisbon measures that they will seek to rejoin. That is welcome, as is the content of that list—at least, so far as it goes. It seems to cover most of the main pre-Lisbon measures that the European Union Select Committee identified as being essential. Whether it covers all that needs to be covered remains to be seen; I am afraid that the period since the publication of Command Paper 8671 has been far too short to give the matter the detailed consideration that it requires. That consideration will now be undertaken by the two sub-committees working together as before, and will form the object of a further report that will be provided to your Lordships’ House before the end of October, as the Government have invited us to do, with a new call for evidence issued on 18 July.

That brings me to the procedural issues covered by the amendment standing in my name on the Order Paper. I placed that amendment on the Order Paper when it seemed as though the Government were seeking authority to trigger the block opt-out while doing no more than asking the House to take note of the list of measures that they might seek to rejoin. In this way, they were dividing in two the integrally linked parts of a single set of decisions which our report to the House made very clear had to be taken together. How could this House reasonably be asked to endorse the block opt-out when it was not being asked to endorse the list of measures we should seek to rejoin? The amendment to the government Motion that was moved by the noble Lord last night has, however, changed that position and has asked the House to endorse the list of 35. That is a major step forward.

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It meets the more important of the two requirements set out in my amendment and, as so often when you are standing waiting for a bus, two come along together. So on this occasion the Government have now, in something close to a death-bed conversion, produced their response to our report, which I spent the afternoon reading, but on which I will certainly not attempt to comment now. Although I can do a bit of speed reading, these matters require a little more care than that. In any case, the result of this is that the two points in my amendment have been met by the Government. I therefore make it clear that I do not intend to divide the House on that amendment.

7.02 pm

Lord Bowness: My Lords, it is a pleasure to follow the noble Lord, Hannay of Chiswick, with whom I, as the then chairman of the justice, institutions and consumer protection sub-committee, worked closely in the previous Session of Parliament when that sub-committee and his home affairs sub-committee conducted the inquiry into the UK opt-out. I agree with many of his comments and I should tell your Lordships that, had a new Motion not been laid before the House tonight, and had we been debating the terms of the original Motion, I would have supported the amendment of the noble Lord, Lord Hannay, and voted for it, had he called a Division.

I speak tonight, however, on my own account and I cannot speak for the current chairman, the noble Baroness, Lady Corston, or the current members of the committee, of which I am no longer a member. Members will understand that for that reason, and because it arrived in the House at about 2.30 pm, I will not comment on the Government’s response to that report.

I can however speak of the findings contained in that report and the evidence on which it was based. The sub-committees had decided to carry out an inquiry prior to 15 October and the announcement of my right honourable friend the Home Secretary, who stated on that occasion that the Government were minded to exercise the option, that it would be the subject of a vote in each House, and that the relevant committees of each House would be consulted before reaching a definitive position, the process of which tonight’s Motion forms part was set in train.

Subsequent to my right honourable friend’s Statement, five Explanatory Memorandums were promised to your Lordships’ committees. They were promised for January or early February—and latterly promised an impact assessment. The impact assessment has not yet, to my knowledge, been seen and the Explanatory Memorandums were produced as the White Paper referred to by the noble Lord, Lord Hannay, only on 9 July, when the Home Secretary made her Statement to the other place. She also made it clear on that occasion that what must happen next is a process of negotiation with the European Commission and other member states, and that those negotiations will determine the final list of measures that we formally apply to join.

The Motion originally laid before the other place expressed the belief that we should opt out, rejoin the measures that were described as being in the national

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interest to rejoin and seek further reports from the relevant committees prior to formal discussions with the Commission and the Council on the set of measures in the White Paper—all prior to formal application to rejoin. In parentheses, I think the delay in opening the negotiations until October will prove unfortunate, as time—and as much time as possible—will be needed for the negotiations to rejoin.

That original Motion at least contained a definitive linkage between the decision to opt out and the 35 measures described at various times as being in the national interest and a commitment to negotiate on those matters. However, that Motion was amended and the Motion carried in the other place omits reference to those matters in the national interest and the Command Paper. The right to exercise the opt-out is absolute and is in the treaty, but readmission to measures to which we wish to be readmitted is not.

The Schengen measures require unanimity in the Council; the other JHA measures are dealt with by the Commission, who may present a proposal to the Council for transitional arrangements—decisions in which we will not necessarily participate. The principle of coherence means that we may not be able to rejoin one measure without rejoining another linked measure, and that may not be acceptable to the UK

This will all take time and there is no certainty. When we were preparing the report, we received no evidence that the Commission would seek to frustrate our rejoining. As to the other member states, the Government were unable to tell us what conversations had taken place. However, like the noble Lord, Lord Hannay, I agree with the proposal to reapply to join the 35 measures described as being in the national interest.

The Motion originally laid before the House, as has been stated already, was merely to note those proposals and that was not good enough. I am therefore very grateful to my noble friends Lord McNally and Lord Taylor of Holbeach for recognising the significance of these measures and agreeing that the Motion should endorse the Government’s proposals in the Command Paper, which sets out the 35 measures that they will seek to rejoin.

The final decisions as to opting out and the measures to apply to rejoin are executive decisions for the Government, albeit that they have spoken about consulting Parliament. So I ask the Government to assure the House that the House will be informed if their intentions regarding the 35 should change.

What of the other 130-odd measures? These, together with the 35, are the subject of the Explanatory Memoranda in the White Papers. I have to say with regret that the Explanatory Memoranda are extraordinarily badly prepared—and even worse presented. It is not clear on what basis the Government chose the 35. No clear reasons are given, apart from the Prüm decisions where there are concerns about costs. Some are stated to be defunct and so presumably of no real concern; some are said not to be needed because we have dealt with them administratively or in domestic legislation. As the noble Lord, Lord Hannay, said, none is stated to be harmful.

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House of Lords reports are generally acknowledged as being evidence-based. The report on the opt-out was so based. We made it clear that decisions on the opt-out should not be made without certain information on which to base that decision. In our report, members of all parties and none concluded that the Government had failed to make a convincing case in favour of the opt-out. We also made it clear that we could not form a view about which measures we should seek to opt back into without a provisional list of measures and an analysis supported by the impact assessment, and that the decision to exercise was necessarily linked with the measures that the Government wished to be able to rejoin.

We were struck by clear and preponderant evidence from witnesses from the legal, law enforcement and prosecutorial professions as to the potentially negative impact of exercising the opt-out. Now, somewhat belatedly in the whole process, we have the provisional list of measures but not the other elements required for final decisions. We are being asked to express a view about opting out without a proper assessment or analysis of whether the benefits of opting out outweigh the possible risks and uncertainties of an application to rejoin. In short, is the game worth the candle? I ask the Government in due course to report to Parliament on the progress of the negotiations so that judgment may be made.

In the mean time, while I remain profoundly unhappy about many aspects of the whole process, I will not oppose this Motion, which goes some way towards addressing the concerns of those who believe the idea of exercising the opt-out to be misconceived. However, and this is crucial, were we to defeat this Motion, we would lose the opportunity, which was lost in the other place, of placing on record and binding in our belief that the 35 listed measures are in the national interest; and we will have lost the opportunity to endorse the Government’s welcome intention to apply to rejoin the same. We can return to the other 130 later, and no doubt they will feature in the reports that have been requested from committees of your Lordships’ House.

7.10 pm

Lord Richard: My Lords, I will deal with a small point to start off with. As I understand it, no impact assessment will now be coming until the final list of measures to which the Government are proposing to opt in is determined, as the noble Lord, Lord Bowness, will notice from the document that we got this afternoon—at long last, the government response to the Select Committee report.

I find it difficult to see the reasons for this debate. I am not absolutely certain why it is being held, or held in this way, or of the procedures through which we are being put. The Government have produced a procedural mess into which, unless we are very careful, they, the country and these issues will sink. It may be worth while briefly going back to the origins of this whole affair.

The Government having declared that they were minded to exercise the opt-out, the matter was then inevitably transferred to your Lordships’ Select Committee

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for scrutiny. The committee decided that, since the matter was so unusual, the scrutiny should be conducted by a joint committee consisting of Sub-Committee E and Sub-Committee F sitting together. This was a precedent but it seems to have worked extremely well. As a former member of Sub-Committee F, I express my thanks to the noble Lords, Lord Hannay and Lord Bowness, for the way in which they jointly chaired that committee.

I will not bore the House tonight with details of how the committee proceeded. Suffice it to say that we took a great deal of evidence and heard from a large number of witnesses, including the Home Secretary and the Lord Chancellor. Rarely—I think never before—have I participated in a process in which the evidence was so overwhelmingly in one direction. It was really quite extraordinary. Members of the committee were actually looking hard for evidence on the other side of the argument, but evidence was there none.

I will quote two paragraphs from the report. We said:

“Beyond concerns about the EAW, which we have already discussed in Chapter 6, very few of our witnesses drew our attention to any specific measures that they considered to be detrimental to the interests of the UK”.

The committee’s conclusions were clear and quite firm:

“We therefore consider that there are compelling reasons of national interest for the United Kingdom to remain full participants in most of the measures and agencies referred to in this Chapter. As to the remainder we have identified no persuasive reason for the United Kingdom to withdraw from them”.

We have waited until today to get the Government’s response to that report. On the very day of this debate, indeed, at last we got it. That is very interesting and, indeed, rather revealing.

In the mean time, however, the Government acted by tabling a Motion in the House of Commons last week, and in your Lordships’ House today, determining that the opt-out should be exercised. It is not a question of discretion. It determines that the opt-out should be exercised, and that is expressly the opinion of this House if it passes the Motion. At the same time, the Government accepted an amendment in the other place that the process of opting back in should be delayed until after three Select Committees of the House of Commons had reported on the measures in respect of which we should exercise the opt-back-in.

The reason for this extraordinary mix-up seems to have been the inability of the Government to produce Explanatory Memoranda in the timescale that they had themselves specified. They had told us that we would get them in February of this year. Had they produced them in Feburary, those Select Committees in the other place could have been engaged in their scrutinising role for some months past. As it is, they will have to do it by October.

The main difficulty that arises from all this relates to the credibility of the Government’s commitment to opt back in to the 35 measures that they have set out. The Lord Chancellor, in his closing speech in another place, said:

“The Government have taken a decision in principle that it will be in the interests of the UK to join a number of measures that involve international co-operation in fighting serious … crime”.—[Official Report, Commons, 15/7/13; col. 851.]

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That statement understandably provoked a reaction from Mr Cash, who immediately asked whether the Government could take the view that it was not appropriate to opt in if the evidence taken by the three committees led to the conclusion that that was not in the interests of the United Kingdom.

That is precisely the point on which some of us on this side of the argument need reassurance. Can I take it—and I hope that the Minister will deal with this directly in his summing up—that the Government’s firm intention is that they wish to opt back in to the 35 measures set out in the Command Paper and that they consider those to be in the national interest?

This is really a political argument and not a legal one. There are obvious risks in the policy that the Government are pursuing. There is no guarantee that the Commission and member states will be prepared to give Britain an easy route back in. There are bound to be some gaps and delays.

If one looks at the 35, I do not think that one can objectively doubt that they are in the national interest. Indeed, if one looks at the Government’s response to the Select Committee’s report, it is clear that they are quite warm towards these measures; I am conscious of time and will not go into the details on that. The tone of the Government’s response is favourable to the opt-back-in of the 35 measures, but this brings us to the real difficulty. If we pass this resolution, that, coupled with the Commons, will give the Government parliamentary authority to exercise the opt-out. There is no such parliamentary authority for the Government to exercise the 35 opt-ins, and there is certainly no obligation—only a declaration of intent. Let us assume that we opt out and then nothing happens. What are the consequences of that? The result is that the 35 measures will lapse. Moreover, the procedure now being used by the Government in the other place—namely, giving Select Committees opportunities to look at this matter in the way that they are—is itself a recipe for delay and continued friction.

The truth is that this procedure is politically disingenuous. The noble Lord, Lord McNally, referred to smoke and mirrors. There is a lot of smoke, and there are certainly one or two mirrors around the Government’s position on this. The noble Lord shakes his head. I do not agree with him. The Government position is to pretend that they are getting rid of significant things in the hope that nobody will notice that what they are doing is not getting rid of significant things but getting rid of things which are defunct, unimportant or irrelevant. Then they will opt back in, so it is said—if they can get the Commission and other bodies to agree—to things which are important and relevant.

The safe way to do this would have been not to opt out in the first place. There is absolutely no reason why we should have taken that risk. Alternatively, if we did opt out, the other way of doing it would be to do the two things together, at least as far as Parliament is concerned. Why could we not have had a vote on a Motion approving both the opt-out and the list of measures to which the Government wish to opt back in? We do not have that. It is not in this Motion. It was certainly not in the Motion that was debated in the

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House of Commons last week. If that had happened, it would have been neater, crisper and more comprehensive. As it is, we should not vote to approve one side of the equation without being in a position also to approve the other side. That is by far the safer way to proceed.

7.20 pm

Lord Sharkey: My Lords, today’s version of the Government’s Motion asks your Lordships to approve the block opt-out of 133 JHA measures. It also asks us to approve the rejoining of measures that are in the national interest and now suggests, without quite saying so in the Motion, that these are the 35 measures set out in the Command Paper. The Motion also invites your Lordships’ EU Select Committee to report on the matter before the end of October, when negotiations with the EU institutions will start—which is, perhaps, an unusual way for the Government to communicate with a Select Committee.

The Government, or some parts of it, seem to have got themselves into rather a tangle over all this. This tangle seems to have led them into, at the very least, discourtesies to Select Committees here and in the Commons and, by extension, perhaps to both Houses as a whole. The very long delay in providing the promised Explanatory Memoranda is a case in point, as is the failure to respond to the report of your Lordships’ EU Committee in the agreed timeframe.

Perhaps the most important and straightforward interpretation of the events of the past few months is the following. The Prime Minister seems to have decided, on or before the date on which he made his now famous Rio speech, that he would exercise the block opt-out. That was on 28 September last year, 10 months ago. There followed a series of not wholly convincing denials that the Government had in fact made up their mind to exercise the block opt-out, and not wholly convincing assertions that they had an open mind on the issue. It seemed pretty clear that the Prime Minister and, perhaps just a bit later, his Conservative colleagues in the coalition had in fact decided to opt out. The moment this became clear—and it was pretty immediately clear—the real political task was not to try to prevent the block opt-out but to agree a sensible, comprehensive and coherent package of rejoin measures. I doubt that, despite the overwhelming evidence against opting out, it was ever going to be possible to persuade the Prime Minister not to do exactly that. The Prime Minister had committed himself and his colleagues far too early and much too clearly.

It is easy to see that the Government were almost certainly not going to be moved. They were going to exercise the block opt-out, come what may, as it were. That meant that the real political debate would be over which measures to apply to rejoin. I know that there has been very extensive debate within the Government over exactly this. The Government’s original Motion appeared to be coy about exactly what these measures might be, but today’s version of the Motion is pretty unambiguous. The rejoin measures for negotiation are the 35 set out in the Command Paper. These rejoin measures proposed in the Command Paper represent the outcome of negotiations within the coalition. On any objective reading, this list of proposed rejoins seems to be entirely satisfactory. In fact, the Lib Dem

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negotiators, and Danny Alexander in particular, should be congratulated on what they have persuaded their Tory colleagues to accept. It may be, of course, that to pass the Commission’s legal requirements for coherence we will have to add to this list one or two other minor and technical measures. However, this would not be difficult and would certainly not be harmful to the national interest.

One of the oddest things about this whole imbroglio is that the Government have not been able to demonstrate that any of the measures they do not want to rejoin is harmful to the national interest or damaging at all. I repeat that the list of proposed rejoins set out in Command Paper 8671 seems to be entirely satisfactory. We must acknowledge that we are where we are but we must also acknowledge the time pressure. It is critical that we get on with this so that we absolutely reduce the chances of any interregnum where we are out of 133 measures and not yet back in to 35, or however many it turns out to be.

I hope that the House will agree with this and will agree to the Government’s Motion. I look forward, as a member of your Lordships’ EU Sub-Committee F, to examining and reporting on matters as they will then stand.

7.25 pm

Lord Williamson of Horton: My Lords, I declare an interest which is in the register. Because of the advisory time limit I intend to speak as fast as Benedict Cumberbatch, who plays Sherlock Holmes on the television.

I shall speak separately about the opt-out—the Government’s decision to exclude the application to the UK of some 130 measures, which of course the UK is entitled to do under the Lisbon treaty—and the opt-in, which is a separate proposal to opt in again to the 35 measures. That requires confirmation by the European Commission, which can impose conditions in the case of the non-Schengen measures, and in some cases agreement of other member states—the so-called Schengen measures.

In order to judge the best result for Britain, the two issues should be examined together. I welcome the Government’s decision to do this in the Home Secretary’s Statement of 9 July and in the submission of these issues to Parliament in the House of Commons and now in this House. We have also had the advantage of the careful examination of these questions in the EU Committee and the very substantial 155-page Command Paper 8671. I did not find it easy bedtime reading but it is a very thorough statement of the Government’s position which we are now invited to endorse—a vital and important change, which I welcome. I have noted that as a result of discussion in the House of Commons the timing is now not quite as speedy as was originally thought.

Although I will first speak about the opt-outs, it is the choice of the 35 opt-in measures and the conditions that we might wish to apply which are the more interesting. However, I will begin with the opt-out. It is important to stress that we are in the five-year transitional period under the Lisbon treaty—Article 10.1 of Protocol 36—and infraction powers under Article 258

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of the treaty do not currently apply. However, if we do not opt out, of course all these measures will become subject to the European Court of Justice and the enforcement powers of the Commission on 1 December 2014. Quite simply, if we do not want that, we must opt out. If we are satisfied with it, we do not need to opt out. That is the basic situation before us.

An examination of these measures, set out in Command Paper 8671, shows that in the Government’s view, a good number of measures have little or no impact in the UK. Your Lordships will frequently find statements such as:

“The Government considers the economic impacts of non-participation in this measure to be negligible”,

or that a measure,

“does not appear to be in force, nor is it likely that it will come into force”.

There are many examples of this. We can draw two conclusions. First, these measures do not matter very much to the UK, which is the Government’s view. Secondly, as a general principle—which for me is important—it is always wise to question the need for legislation, whether from national or EU sources, unless it can be shown to be essential.

A mountain of secondary legislation passes through this House—there were 11,414 pages in 2009. This legislation is dominantly of national origin and the proportion that is Brussels-derived and under the European Communities Act is quite small. However, in the area of justice and home affairs there are a lot of regulations and legislative measures and the Government have decided that they want to go for the full opt-out. We might say that whatever the arguments advanced so far—and I respect them—this may make a small contribution to reducing exaggerated claims of the role of EU legislation in Britain.

I turn to the opt-in proposal, which is intended to safeguard and reinforce our national interest against organised crime and trafficking and to favour the most efficient administration of justice across frontiers. As I have already indicated, there are two types of these measures, the Schengen and the non-Schengen, and the procedures are quite different for bringing this to a conclusion as recommended by the Government.

There are some quite important measures among the 35, but they are mainly non-Schengen measures in the form of Council acts or decisions. Examples are the Council act on mutual assistance and co-operation through customs administrations—the so-called Naples II, which I believe is the basis which we use now. Then there are the Council decisions strengthening Eurojust in the fight against serious crime; the Council decision establishing Europol, whose excellent work was specifically pointed out by the Home Secretary in her Statement; and, of course, there is the decision on the European arrest warrant, which was dealt with extensively in the Home Secretary’s Statement together with the specific proposals she put forward for amendment of UK law to respond to some problems in practice.

I will say a few words—speaking as fast as I can but not as fast as Benedict Cumberbatch—about Europol and the European arrest warrant. Europol is just the sort of organisation that we need if we are to keep

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pace with—or preferably outpace—trans-border crime. It is common sense that we should stick with it in the interests of our law-abiding citizens, and that we should obtain the two assurances mentioned by the Home Secretary on data sharing and security and on there being no power for Europol to initiate investigations. I hope that we can deliver the Europol opt-in simply and quickly, by whatever method we go at it, because I am in favour of it.

The European arrest warrant is highly valued but it is much more controversial. It makes sense to operate on an EU-wide basis in order to avoid the complexity of negotiating extradition agreements with many different countries. The Home Secretary has indicated the changes that she wants to make in national law. I will not go over them again. They are in her Statement. They are all very sensible and we should endeavour to stick with them as the decisions on opt-ins go forward.

To conclude, the Government have made their choice, but the end of the operation will be when the Commission confirms the opt-ins, or in some cases when the member states agree them. It will be a good thing to have another report from the EU Committee. The changes that we have just discussed—the introduction of the word “endorse” and the other actions by the Government—indicate that we have a basis for responding to the motivation behind the amendment that the noble Lord, Lord Hannay, will not now press.

7.32 pm

Viscount Eccles: My Lords, I am a recently appointed member of Sub-Committee E. It has been an interesting baptism, dealing with the opt-out decision: all or nothing. From time to time it seemed that we were dealing with a booby trap on which was written, “I wonder how they’re going to get out of that”.

As the noble Lord, Lord Hannay, and my noble friend Lord Bowness said, we came to a clear, utilitarian answer to a rather complicated question. We made quite a long answer to that question, which was that the case was not convincing. As the Irishman said when he was asked for directions, “I wouldn’t start from here”. Perhaps it never was a utilitarian question; perhaps it was political; and perhaps we came up with the wrong answer.

I am a European. I am in favour of co-operation and against centralised control. I was lucky enough to be in Strasbourg in 1949 when there were 10 members of the Council of Europe and Winston Churchill made the keynote speech. One member of the 10 is not a member of the Community, but now, 64 years later, there are 47 members of the Council of Europe, and more than half of them are members of the European Union. Since the Commission and the Council are, as it were, the children of the Council of Europe, they should refer to the Beatles’ song, “When I’m Sixty-Four”, the last line of which is:

“Will you still need me, will you still feed me,

When I’m sixty-four?”.

From time to time, any institution needs a renewal of its mandate. Many people in this country and elsewhere are not sure why the Commission and the Council should have that renewal. Every now and

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again, a wild card is thrown on the table that makes people worry. The preamble to the Lisbon treaty refers to,

“ever-closer union among the peoples of Europe,”


“a new stage in the process of European integration”.

I suggest that many people will not know what either of those aspirations means. As far as I know, nobody has ever given them a clear definition. Are we still intent on the avoidance of a third world war? I rather think that we no longer have the weapons with which to create it. Are we just a trading bloc? Will harmonisation of law across Europe one day end the defence of members’ legal systems? In short, what is the European project now? Is it intent on enhanced co-operation or centralised control? The public do not know the answer. It is a very complex question—not just this decision but the whole state of Europe—and it needs clearing up. The complexity and uncertainties must be exposed and discussed, and this Government are doing just that.

Tonight, the decision to opt out and opt back in is about co-operation and not central control. It is almost a housekeeping issue. However, the uncertainty about where it might lead means that many people do not see it that way. Therefore, the Government are entirely right to decide to opt out and opt back in to the 35. They will do that successfully, and that will restore public confidence in their ability to level with the European Union—not always a certainty in many people’s minds, and certainly not seen by many members of the public as being the case.

The relationship with the Commission and with the Council will be improved by our willingness to enter into long and serious negotiations. Therefore, it is entirely right to take this opportunity to renegotiate a system of international justice to the best advantage of ourselves and of other members of the European Union. I fully support the Motion.

7.37 pm

Lord Tomlinson: My Lords, over recent months, so many things have been said on so many occasions about opt-outs that most people had not heard about before the decision was taken to consider the consequences of Protocol 35 of the treaty of Lisbon. We heard so many contradictory statements. Today, we are not really having a debate about what our relations should be. Our debate has nothing to do with the improved governance of Britain. It has precious little to do with our relations with the EU on police and criminal justice measures. Our debate has everything to do with appeasing Eurosceptics on the Conservative Benches in the House of Commons. So concerned are we about appeasing them that we cannot even put the same Motion before the two Houses. The Motion that they approved did not ask them to endorse anything, and, as recently as yesterday, we were not asked to endorse anything. It is all down to the process of changing your mind as you go along to appease the Eurosceptics. I warn the Government that what they are doing is not appeasing them but driving them to seek ever greater concessions.

Everywhere, the tactic has failed. Their Motion to appease Euroscepticism differed from the one we are dealing with here. They could not be asked to endorse the list of the 32 measures. When we were beginning to

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have controversial arguments about the measures for police and criminal justice measures, I was somewhat reassured by a Written Ministerial Statement made on 20 January 2011 by Mr David Lidington, the Minister for Europe. He included references, for example, to consultation before the Government make a formal decision. He also referred to consultation on the arrangements for the vote. All those ideas were there.

There were further statements on the issue. The Home Secretary wrote two letters to the European Union Select Committee which repeated the undertaking and provided the first list of these police and criminal justice measures. She assured us of prior consultation. Yet within the space of the two letters, between the first one promising continued consultation and the second one promising continued consultation, the Prime Minister, probably thinking that he was escaping the glare of publicity by speaking in Rio de Janeiro, made a speech in which he promised that we would opt out. He announced it at a press conference, saying that,

“the opt-out is there. We’ll be exercising that opt-out”.

This was at a time when your Lordships’ Select Committee was working hard on the basis of the promises that we received from the Minister for Europe and in two letters from the Home Secretary. Yet the Prime Minister pulled the rug from under their feet because he thought that that would gain him a few extra brownie points from the Eurosceptics in the House of Commons—so much for the assurances of the Minister for Europe and the Home Secretary.

I contrast the work of your Lordships’ Select Committee with the rather tawdry, shoddy apology of a response to Parliament from the Government which they sneaked into the Printed Paper Office today, several months too late. Your Lordships’ report was a thorough, evidence-based analysis. However, the Government’s response to it came at the very last moment and is hardly worth the paper on which it is written. There are some good bits in it but most of it comprises points which the relevant Members should be ashamed of writing. It has the same level of competence as what purported to be an Explanatory Memorandum.

I have almost observed the five minutes speaking limit. However, at the risk of really getting up the nose of the noble Lord, Lord McNally, I will ask him the same question that the noble Lord, Lord Maclennan, has asked. We are opting out of all the relevant measures by 31 May next year. At that point none of those measures will apply to us. We will apply to rejoin some of them but by the time we do so we will be extending new competences to the European Union which we have given up through the opt-out.

The noble Lord, Lord Maclennan, asked a fair question and did not deserve to be muttered at and abused by the Front Bench: namely, are these the sort of measures—where there is a transfer of competence back to the European Union—whereby, under the rather stupid legislation that the Government introduced in relation to European referenda, we will be required to have a referendum? Will the referendum be on the whole package or will there be one on each of the 35 measures? The noble Lord, Lord Maclennan, has a right to know that. When the Minister replies to him, I would like to be told the answer as well.

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7.43 pm

Lord Taverne: My Lords, I, too, would have voted for the amendment moved by the noble Lord, Lord Hannay, if the Motion had remained in its original form. Now it is one which I can support because it commits the Government to opting in as their official policy to the measures which matter most. However, the history of where we have got to needs to be borne in mind because it is a reason for exercising a certain amount of caution. When the negotiations started between Oliver Letwin and Danny Alexander, the Government—at least the Conservatives—were absolutely clear that certain red lines existed, including the European arrest warrant and more jurisdiction for the European Court of Justice. There was strong opposition from Open Europe and, naturally, from the UKIP tendency inside the Conservative Party, but there was also opposition from leading figures in the Conservatives such as Dominic Raab, who kept on explaining that you did not need Brussels at all and that you could organise a whole lot of separate bilateral negotiations. Fresh Start said that it would not opt back into anything. However, matters have changed and we are now in a position whereby, on the face of it, the Government are committed to serious opt-back-ins.

However, the House of Commons debate was not exactly reassuring. In particular, the speech by the Home Secretary was in my view pretty disgraceful, reiterating the claim that this was the first step in the major repatriation of powers because 100 measures would be left opted out of. It was in fact one of the ablest of the Europhobes, Mr Jacob Rees-Mogg, who completely exploded that idea by asking which were the important measures that we were no longer going to opt back into. In addition, the whole tone of the Home Secretary’s speech was one of trying to appease the Europhobes. She assured them that they did not have to worry too much because they always had the right to vote against the opt-ins when they came to Parliament again.

I want an assurance from the Government, which I believe the Minister will give, having talked to him on this issue very recently. We need an absolute assurance that the Government will not yield one further inch towards the Europhobes. It is not a happy history. The Prime Minister had made a number of pro-European remarks but when the going has got tough he has always given in. That is why he bought peace with the promise of a referendum in 2017, which is a ridiculous commitment because by 2017 we will not yet know what sort of Europe—which is in a state of flux—we will either have to stay in or leave. Therefore we need an assurance that there will be no further surrender and that there will be a strong Whip in the House of Commons and not be endless speeches that would delay the whole procedure—because every single opt-in measure will be challenged by the Europhobes, who will not give up their opposition.

If the Government stand firm, I think this is a good result. I am not as worried as the noble Lord, Lord Tomlinson, about a legal challenge. Having looked at this, I do not think that there are grounds for a legal challenge. However, the tactic of judicial review could be used to try to delay a decision. I am more worried

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about that than about the merits of a challenge. If the Government stick to it, this will be a good result. It will be the first defeat for the UKIP tendency and for UKIP and I hope that there will be many more. I hope that in the 2014 elections all the parties—or at least those that support these opt-in measures—will expose UKIP’s position as that of a party which is soft on crime and does not want measures that can deal with people traffickers, money launderers, porn merchants and all the rest. We should seize that opportunity provided that the Government stick firmly to what they have now promised.

7.48 pm

Lord Anderson of Swansea: My Lords, as a member of the Joint Committee I was surprised that neither in the Statement to Parliament on 9 July nor in the Command Paper of the same date did the Government bother to refer to, let alone commend, our work. However, as if attempting to remedy this slight, the Home and Justice Secretaries, in an undated letter sent about 19 July, went perhaps over the top in glowing superlatives relating to our report. Yet, at the same time, they compounded their cavalier attitude to the committee by informing us when we should conclude our next inquiry on the subject without consulting us in advance.

The point of criticism of the Government’s process has already been well made, so I turn to substance. I pose this simple question: how would a judge conclude if the evidence that we had received were placed before him or her? Surely that judge would find the one-sided comparative weight of the witnesses before us absolutely compelling and overwhelming.

Supporting the Government were Mr Dominic Raab, both in his own right and again as the drafter of the Open Europe submission. Then, of course, there was the United Kingdom Independence Party. The committee staff managed to locate Mr Martin Howe, a senior lawyer but also a Conservative activist, having sought nomination on several occasions.

However, critical of the Government’s position were all the professional bodies, all the enforcement agencies and the prosecutorial bodies. Our committee report was endorsed by the Law Society of England and Wales, the Bar Council, the Faculty of Advocates and the Scottish Government. Our one witness from the Republic of Ireland was, frankly, baffled by the Government's stance. In short, the weight of critical evidence was overwhelming and our judge would surely have been driven to the same conclusion as that which the committee reached unanimously—namely, that the Government had not made a convincing case for exercising the opt-out and that to do so would have significant negative repercussions for the national interests of our country. Nevertheless, the Government have ploughed on regardless and claim to have acted in the national interest.

The noble Lord, Lord McNally, was moved to write in the Liberal Democrat Voice that “we”—the Liberal Democrats—

“have fought hard to keep the public safe, in the face of a Euroscepticism which would put public safety at risk in the pursuit of its anti-European agenda”.

That is hardly a flattering description of his Conservative colleagues in the coalition. In the same article, he proudly claimed that the deal with those Conservative

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Eurosceptics illustrated the influence of Liberal Democrats on the Government. The truth, of course, is that the Liberal Democrats could have blocked the opt-out entirely had they so wished, but chose not to do so.

Again, having reviewed all the evidence, our learned judge would have noticed the leitmotif of suspicion, almost obsessive in its intensity, of the Government's attitude to the Court of Justice of the European Union. That is particularly puzzling in the light of the fact that the Government have over recent years opted into a number of measures subject to the court and must therefore have no objection in principle to subjecting themselves to the court's jurisdiction—paragraph 104 of the report. It is puzzling also because the court already has jurisdiction over pre-Lisbon EU civil asylum and immigration matters, surely central to national sovereignty. Paragraph 96 of our report pointed out that there are very positive aspects regarding preliminary references to the court. In paragraph 89, the committee, having examined all the evidence—as no doubt would our judge—dismissed the bogeyman of excessive activism:

“we can discern no convincing evidence that the CJEU has been either judicially activist or that its rulings set out to undermine the autonomy of Member States’ criminal justice systems”.

Our judge would probably consider the question of costs not to be within his remit, but there are threefold elements of costs: potential financial costs of seeking to opt back in; the general uncertainties and potential hiatus in the transition period; and, of course, the potential loss of influence in Brussels by the signal which the Government have so clearly given. Who can forget the position of the then Conservative Government from 1993 to 1997, when we lost much influence by the turmoil in the Conservative Party at the time?

All that turmoil for what? Again in the words of the noble Lord, Lord McNally, in the same article:

“The measures which are being dropped on the other hand are, by and large, those which are now redundant, those which have been superseded by newer instruments, those which have already been incorporated into UK law, and those which have very little operational use for the UK. So we’re keeping the wheat and losing the chaff”.

Similarly, the Economist of 15 July headed its article,

“Britain wants opt-outs from EU rules, as long as they don't much matter”.

Of course the Government have made some positive suggestions, for example by remedying deficiencies in the European arrest warrant, but not by diktat. The normal European method is by consensus, by forming alliances, and by working with our European partners consensually. Again, the Economist stated:

“Mrs May’s statement was designed to please Eurosceptic Tories. Instead they denounced it”.

That is, all this trouble is a political decision not a legal decision, one designed to please what one senior German parliamentarian called the Tea Party tendency within the Conservative Party.

I have one warning for the Home Secretary—I end on this. Her Tory colleagues will not be satisfied by her gesture. Like the keeper in the zoo's penguin house, she may regularly be inclined to throw fish to them, but they will swallow them down and ask for more. She should be warned: they will indeed ask for more.

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7.56 pm

Lord Lloyd of Berwick: My Lords, it is a pleasure to follow the noble Lord, Lord Anderson, with whom I so often find myself in agreement. I hope that tonight he is not casting me in the role of his hypothetical judge.

I was of course very glad that the Government decided to include Europol, Eurojust and, above all, the European arrest warrant among the 35 measures, but I am not yet persuaded that an opt-out in 2014 is the way ahead. One argument used by those in favour of the opt-out is that it would set limits on the jurisdiction of the Court of Justice of the European Union over our domestic affairs. I could understand that argument—although I would not agree with it—if we were going to get shot of the court of justice altogether. Of course, that would be pure fancy. We would still be subject to the jurisdiction of the court in respect of all the many police and criminal justice measures we have signed up to since Lisbon, and would also be subject to its jurisdiction in respect of the 35 measures which we all hope to rejoin. So the European court will be there anyway in one way or the other, and I think we should pay little attention to that argument in favour of the opt-out.