§ Motion made, and Question proposed, "That this House do now adjourn."—[Mr. Royle.]
§ 9.55 p.m.
§ Mr. A. Edward Davies (Stoke-on-Trent, North)
I desire to draw the attention of the House to a matter which, coming after the important affairs we have recently been discussing, may seem very domestic and of much less interest and importance. Nevertheless, I think that, when our story has been told, our action in bringing it to the House tonight will be fully justified.
Last Thursday, at Question Time, I raised with the President of the Board of Trade a subject which concerned the effect of Japanese pottery competition as it was revealing itself in the dollar markets in which British pottery exporters have to compete. I had hoped that we might have had a little more time tonight to consider not only this special commodity, pottery, in which we are interested, but the whole of the commercial developments as they affect a number of industries in this country, in relation to Japan.
I hope that I shall be excused, and that my colleagues who are supporting me will be excused also, if what we are saying tonight seems like special pleading. The question to which we directed attention last Thursday related to certain trade practices which have been brought to our knowledge by individual manufacturers of pottery in this country, and by the British Pottery Manufacturers' Federation. It concerns the production of articles of close resemblance to British manufactures and which could be said to be copies of designs, patterns and colour schemes that are almost entirely the work of British people, at great cost in terms of research and experiment.
These products from Japan are being offered in the dollar markets, particularly in the United States of America, at anything from one-third to one-eighth, and even less, of the prices at which British products are being sold in the United States. It will be known that our exports of pottery go to the United States, Canada, the West Indies and the Bermudas, and that they have brought in a useful contribution in dollars to this country.
1442 We appreciate that the extent of the competition may not have developed fully, but we would remind the hon. Gentleman who represents the Board of Trade tonight that this is not a new matter. The attention of his Department has been called to this subject over a period of time, and some 18 months ago it was a matter of correspondence with the President of the Board of Trade. I have it reliably from the British Pottery Manufacturers' Federation that the facts are well known in his Department, and especially to the regional control.
When the problem was put before the right hon. Gentleman, he asked for details so that he could pursue his inquiries, as we hoped he would, in Tokio with the organisation known as S.C.A.J.P. I do not know, and perhaps my hon. Friend will tell us, whether he has received any direct evidence from the manufacturers. I am informed that the British have been in communication direct with the General Headquarters in Tokio. A letter was sent some time ago to General MacArthur—
§ It being Ten o'Clock, the Motion for the Adjournment of the House lapsed, without Question put.
§ Motion made, and Question proposed, "That this House do now adjourn."—[Mr. Royle.]
In this letter, General MacArthur's attention was drawn to the deliberate copying of British patterns and decorations and to the fact that the average price of the Japanese products was about one-third of their British equivalents which, in their opinion, did not seem to be reasonable competition. A reply to this communication has been received from General Headquarters in Tokio, which, I understand, amounts briefly to a request for specific instances and samples. Then, it is promised that General Headquarters will take up the matter with the Japanese Ministry of Industry and Commerce. My information from this reliable body, the British Pottery Manufacturers' Federation, is that samples of Japanese-decorated china and British ware from which they have been copied have been sent to Tokio, and certain correspondence has ensued, which I think ranges round the problem of what is a fair price, and so on.
May I make it quite clear that, while we are concerned that a fair price should 1443 be obtained for our products, and we do not think that the Japanese are competing fairly on that basis alone, we are primarily concerned with this practice of copying our own models which are the result of research and hard work in this country. I produced last Thursday some evidence of what is happening. I produced one or two models to show that people have been employed in this country to copy types of English lines, that great work has been done in placing these products upon the market, and that they have been made available in the dollar areas for sale and have been sold to a large extent. What happened was that in a few months' time we found that products almost exactly the same in pattern and line were appearing at much reduced cost. It is with that aspect that we are mainly concerned this evening.
I want to ask what can be done by the Board of Trade to help us. What can be done, for example, in terms of copyright? Is there some advice to be given to the manufacturers that they should try to get their products copyrighted in America, and would that afford any protection? Can any action be taken with the United States Government to safeguard these commodities which are produced, as we think, under reasonable conditions in this country, as against the comparatively unfair conditions in Japan? Has any investigations been conducted in America to ascertain how this kind of practice is arising? It is said that American merchants have sent some of the English products to Japan and have got similar wares back at a very much reduced cost. I give that information for what it is worth; I have no evidence to confirm it, but that is what is reported to me.
I have a statement given to me by the director of a firm in North Staffordshire that in his view there are Japanese commercial representatives in America who pick up these products and send them to Tokio. In a few months we get almost the exact models coming back. I do not want to weary the House, but I have in my hand an English model which was the result of great research and hard work by a clever young woman well known in the pottery industry, and this model was put on the market. Some of these models represent a town clerk, a parish beadle, a 1444 lord mayor's coachman, and "mine host" at the inn.
§ Mr. Davies
These products are all types peculiar to this country. This work has been copied, but the product is an inferior article, although that is noticeable only to the discerning eye.
We want to know what the Board of Trade are doing in the matter, or whether they can do anything about this deliberate copying. I will not say much about fair conditions, because I hope that some of my hon. Friends will have an opportunity to enlarge upon that subject. Having produced the evidence in a tangible form, I hope that the Board of Trade will give us some information on what can be done. Are they satisfied that proper steps are being taken in Japan to safeguard our interests? We do not ask for a privileged position. We recognise that the Japanese have to live, but we are asking that ordinary commercial practice should be observed.
§ 10.7 p.m.
§ Dr. Barnett Stross (Stoke-on-Trent, Central)
I am sure the House has listened with interest to what my hon. Friend the Member for Stoke-on-Trent. North (Mr. Edward Davies) has said. I shall limit my remarks very narrowly indeed—to the question of the effect upon our designers and artists of this exact imitation of the products of their imgination and work. It would not be unreasonable to use a stronger term and say that it is shameless forgery. The reason why these particular samples are chosen for duplication and distribution in the United States is because they are popular. They portray aspects of our earlier life, and they are products of very careful and exact research as to shape, custom, colour and general design.
It seems doubly objectionable that Japanese manufacturers should be able, without let or hindrance, to imitate them and send them into our markets. I 1445 should like to put on record that I feel that this kind of imitation is theft of our designer's ingenuity, training and weeks and months of patient research. I should like the Parliamentary Secretary to give us a real assurance that he will pursue every possible endeavour to put an end to this exploitation of the work of our designers and of our industry by Japanese manufacturers.
We all want to see the standard of the Japanese workers steadily rising, but we do not consider that this is a suitable method to achieve that end; nor are they likely to get our good will if this is the method they pursue. Japan has traditions of the past, and we do not believe that their artists and designers are so bankrupt of ideas that they must pilfer from our people. I am sure the Parliamentary Secretary will agree with me that our people have every moral and legal right to protection, and I beg him to say so when he replies.
§ 10.10 p.m.
§ Mr. Shepherd (Cheadle)
I am sure the House will appreciate the motives which have inspired the hon. Member for Stoke-on-Trent, North (Mr. Edward Davies), and the hon. Member for Stoke-on-Trent, Central (Dr. Stross), to protest at the pilfering of designs which is going on by Japanese pottery manufacturers, causing anxiety to those in the potteries in this country. I have very great admiration for the skill of the designers and workers in the potteries, because from most dismal and appalling physical conditions they turn out articles of great beauty. It is always a mystery to me that from such terribly forbidding places as potteries articles of such exquisite design are produced.
However, I urge the House to have some regard to the realities of the situation. The stealing of other people's ideas is a very widespread practice, and is by no means restricted to the Japanese. Some people in this country even imitate the oratory of my right hon. Friend the Leader of the Opposition, and it would be perfectly untrue to say that we here do not take advantage of the ideas which emanate from outside. In fact, I believe the Board of Trade facilitate the importing of specimen samples without duty and Purchase Tax in order that manufacturers in this country may 1446 have an opportunity of seeing what other people are producing. Therefore, I do not think we ought to be too narrow in our views on this matter, although I agree that if I created a design for pottery I should be terribly annoyed if anyone imitated it.
What can be done to stop them? I think very little. An international convention might be arranged, but it would be terribly easy, if there were not real physical and legal difficulties in the way, to get round them. The hon. Member for Stoke-on-Trent, North, has produced an article of complicated design, but if the Board of Trade, by dint of great energy, persuaded the Japanese and the Americans to agree to some international convention, it would not prevent the Japanese manufacturer from copying the designs by taking steps which would be outside the scope of any such convention. Obviously, it could be done very easily indeed. Therefore, while I want to prevent the Japanese from copying our ideas, a practical scheme to stop it presents almost insuperable difficulty. In fact, even within our own country, it has become a problem. There are plenty of people who will not patent a process because they feel that by patenting and publishing the process they are giving an open invitation to someone to find a way round. Many people prefer not to patent a process rather than open the way for others to imitate it.
There is one subject on which I hope the Secretary for Overseas Trade will comment when he replies. It always puzzles me why the Japanese prices are so very silly. I have seen cotton cloth, the price of which is less than half the British price. If I were in business selling against a competitor, I should like to beat him, but I would not sell at a price which was as low as half his price. The hon. Member for Stoke-on-Trent, North, has told us that the Japanese are selling pottery at one-third of the British prices. I should like the Secretary for Overseas Trade to enlighten us on why this thing happens, because it is a very remarkable thing that a nation exporting here should be selling at one-third of the price at which these articles are sold in the United Kingdom. I do not think the Japanese would have any difficulty in beating our prices and we could not blame them for that, but why they put forward these silly prices is beyond me.
1447 I have said enough to show that while we want to stop these people stealing our designs if we can, the practical difficulties are very great. I hope the Secretary for Overseas Trade will do all he can to try to keep the Japanese from quoting these ridiculous prices for their products. We do not want to stop them making a living, and we certainly want to see their conditions of employment raised, but we do not want to have the Japanese selling at the kind of prices that they are selling at in Great Britain today.
§ 10.16 p.m.
§ Mr. Ellis Smith (Stoke-on-Trent, South)
I wish to associate myself with all that has been said tonight. It is very important that we should have as full a reply as possible, and I shall therefore be brief. Before the war we raised this matter time after time. I admit that it is not an easy matter to deal with, and it applies to more than one industry. This grievance applies also in the textile and silk industries, which are the other two principal industries affected.
The annoying part of the particular example cited tonight is that beautiful pottery of this kind cannot be produced without a large amount of work being put in before the production stage. First, a large amount of research work takes place, then the artists, with whom my hon. Friend the Member for Stoke-on-Trent, North (Mr. Edward Davies) has close and friendly associations, have to produce sketches, which are submitted to the overseers, and when they are accepted models have to be made. A tremendous amount of work has to be put in before the final product appears, and it is most unfair for copies of this kind of work to be made in this way.
There is another aspect about which we are very concerned. In this country we have what is known as a fair wages clause, under which firms cannot employ people below a certain wage. Before the war it was found that in Japan, in particular, and in other parts of Europe, people were employed under coolie conditions. We have great sympathy with them in their difficulties, but at the same time, we in this country have certain standards which are accepted by organised employers and organised work-people; we are contributing to the main- 1448 tenance of social services and our standard of living, and if these are to be undermined by this kind of imitation it is time we had an international fair wages clause.
While I do not expect that to be dealt with this evening, I wish to place it on record so that the Secretary for Overseas Trade and his Department might also give consideration to the need for the United States and our country to consider whether we should not agree between ourselves that a fair wages standard, or fair conditions standard, should be operated in our two countries. Products from other countries which are apt to undermine our standards should be prohibited. In addition, we ought also to consider raising this at the International Labour Conference so that all the members of that conference can devote their attention to this menace to the reasonable standards which have been built up in countries like our own.
§ 10.19 p.m.
§ The Secretary for Overseas Trade (Mr. Bottomley)
I join in the general tribute paid to my hon. Friend the Member for Stoke-on-Trent, North (Mr. Edward Davies), for raising the subject matter of this debate. As has been said, it has been debated many times, and Questions have been asked in the House. I assure him, as I have done before, that the Government are fully alive to the threat of this unfair Japanese competition, and share the anxiety of the industry.
We have to face the fact that for the moment we are rather fortunate in that the volume of the Japanese export trade is about half what it was pre-war. At the same time, Japanese industry is not yet at its maximum because it is far from having recovered from the devastation caused by the war. We have this consolation, however, that from this present limited production and, of course from any increase, Japan has to cater for a larger population than before the war. Also, on the assets side the trade unions are much stronger. On the other hand, Japan has lost two of her greatest markets in China and Manchuria, and therefore her competition is concentrated on fewer markets.
Japanese pottery is not being produced at the rate it was before the war. The industry is only working at about 70 per 1449 cent. capacity, its machinery is mostly out of date and has only partly been renewed, and it would be extremely difficult for the industry to make great improvements because of its own financial and economic difficulties. This year the percentage of production is about 46 per cent. of what it was in 1937. We must realise that Japan, like us, is aiming at a balanced economy and that the United States taxpayer is paying about 300 million dollars a year to keep the Japanese economy viable. So the U.S.A. has quite rightly, a great say in the development of Japan. We have, of course, a strong case to make in the field of strategy. Where an industry is being developed which may be a threat to our own security we can justly make representations.
I do not share the pessimism of the hon. Member for Cheadle (Mr. Shepherd). I think something can be done. In connection with copying, I agree with the word "fraudulent" which has been used. The hon. Member for Stoke-on-Trent, North, referred to specific cases. I know of one or two and perhaps I may cite one which is being investigated at the moment. Someone in the United States sent a sample of one of our exports to Japan and asked a manufacturer there to copy it. If such a case is brought to our notice, we can take prompt action, particularly if the design is registered in the United States.
Once we have taken that action, and it is reported, the Ministry of International Trade and Industry in Japan will put on an export control. So I stress the fact that we should have all the available information supplied to us as soon as possible. If, for some reason, it can be shown that a United States firm is involved in this unfair competition, then we can take it up with the United States Federal Trade Commission. Let me add that our Commercial Minister in Washington is always ready to give assistance to industry as and when it is required.
Also in Japan there is a law dealing with unfair competition under which the Japanese authorities give protection against fraudulent trade marks and copying by their manufacturers. Under that law, if a person is proved guilty, he can either be sent to prison for three years or be fined 200,000 yen. Let me say that the administration of General MacArthur give us all the help they can. So I think 1450 that in regard to copying of design and the fraudulent use of foreign trade marks, we have some remedies at hand which can be used. I hope this will allay the anxiety on behalf of artists, expressed by my hon. Friend the Member for Stoke-on-Trent, Central (Dr. Stross).
My hon. Friend the Member lor Stoke-on-Trent, South (Mr. Ellis Smith), spoke about labour conditions, which really are the basis of the unfair competition. The low labour costs are something which we cannot meet, but, as I said earlier, the genuine trade union movement is growing, and labour standards have been raised by, for instance, restrictions upon child labour by the administration in Japan. Furthermore, an Act of Parliament was passed in 1947 which dealt specifically with labour standards. The average increase in wages in the potteries from 1947 to June of this year, I am told, is about 700 per cent. All I can say is that as far as His Majesty's Government are concerned, it is our policy to support the Supreme Commander to raise Japanese living standards and to encourage the healthy growth of the trade union movement.
I come now to the recent trade arrangement which has been signed between the authorities in Japan and the United Kingdom Government. Under the arrangement for this year, we shall buy grey cloth for processing and re-export, raw silk, timber and food, but no pottery. The United Kingdom cannot, of course, solve this problem single-handed. It is possible that other countries who are affected will seek protection against this unfair competition, and we shall certainly join in whatever representations are made.
The point was made that the Japanese will be anxious to avoid a situation similar to that which prevailed before the war, when special action was taken by Governments to meet unfair competition from Japan. I am confident that should it be necessary, that action will be taken again, and this in itself will deter the Japanese from being too extreme in embarking on methods of competition which can be said to be unfair.
The hon. Member for Cheadle did not raise specifically the question of copying, but I mention this because of his special interest, and that of my hon. Friends, in textiles. I have just heard from our repre- 1451 sentative in Tokio that the Japanese have made definite progress in preventing the intentional or unintentional copying of foreign designs. They have a catalogue of 8,265 different designs and all members of the trade, I am told, must make it a general rule to demand a letter of guaran- 1452 tee from a buyer when taking an order for a printed design.
§ Question put, and agreed to.
§ Adjourned accordingly at Twenty-eight Minutes past Ten o'Clock.