BRITISH MANUFACTURERS' DESIGNS (PLAGIARISATION) (Hansard, 1 February 1967)

§ Mr. Bernard Weatherill (Croydon, North-East)

I am pleased to be able to have an opportunity of bringing to the attention of the House a very serious matter, namely, the amount of exports which are being lost to British manufacturers as a result of plagiarisation of design by foreign competitors. There is a leading article in today's issue of Design which highlights the whole question.

This is a matter of great concern to a number of our industries. It is particularly important at this moment of our history when we need to encourage, stimulate and increase our export trade. There is no need for me to remind the House that we must import 50 per cent. of all our food and almost 100 per cent. of all our raw materials. We will starve if we do not sell our goods abroad.

It therefore goes without saying that we should be encouraging exports of high idea value and low material cost. It is particularly galling to see articles which incorporate this principle being copied by our overseas competitors. It is very difficult to assess the total loss to our economy resulting from the plagiarisation of British designs, but it must be considerable and probably runs into several millions of £s annually.

The Minister of State will know—I entirely accept this—that this is not a new phenomena. A Question was asked in the House on 14th July last by my hon. Friend the Member for Merton and Morden (Mr. Atkins). The Question has been the subject of running correspondence between the Minister and myself. I have been pressing him to implement the Johnston Committee's Report which, I think it is generally acknowledged, would go a long way towards putting a brake on what can only be described as piracy, in the sense of piracy of ideas.

Doubtless the Minister will have seen an article in the January issue of The Director by Mr. Walter Gundrey which highlights the whole problem. The Minister may also have seen a report in 466 The Times of 26th January which gives a number of examples of this very serious problem. I have been in touch with Mr. Leslie Julius who is mentioned in this article and who is the managing director of Hille and Co. The report in The Times quotes Mr. Julius as saying that since 1948, when his company first went in for advanced designs, the number of ideas that had been stolen ran 'easily into three figures. Everything they did, he said, was watched closely. The Registered Designs Act was a waste of time. Mr. Julius tells me that he has recently lost exports to Israel on this same principle and at this very moment he is locked in conflict in Spain as a result of the copying of a chair which he has designed and which is being copied in that country. The chair which is being copied is being produced in inferior materials, with a resulting loss of reputation to his company and, in order to try to get it stopped, very heavy legal expenses are involved.

I have had similar complaints from toy manufacturers. Because of the nature of the toy trade, toys have to be brought out in time for the Christmas trade. They are shown to the trade as a whole many months before Christmas. This gives ample time for copying to be carried out. I have had a number of examples from the toy trade. I want to show the Minister two of them. They are two rattles. I hope that I may be permitted to produce them, Mr. Deputy Speaker. One is made in Holland. The other is made in England. I hold them in my hands. The Minister will see that they are pretty well exact copies, although the colours are reversed. They even make the same noise. Perhaps it would be out of order for me to demonstrate that.

There is another example in my office of two Canadian mounted police models, one made in this country of very high quality selling at about 5s., the other copied abroad and having on its box a description of the toy which is exactly similar. This sells at about half price. This is another very serious matter to the toy trade, which makes a significant contribution to our export trade.

The jewellery manufacturers complain—rightly so. They say that they have to keep first-class designers at work at an extremely high cost. They tell me that over 10 per cent. of their turnover may 467 go in developing a new design. They complain that good designs are being ruined by a flood of copies on inferior materials. They complain also of loss of exports. It often costs £16,000 to design an article which they say may be copied for as little as £500. The price is cut accordingly.

Only this morning the Society of Industrial Artists and Designers has been in touch with me and told me that these men who have vision and initiative to follow an active and positive design policy are losing heart. The consequence is that there will be a decline in the quality of British design, which is at present a most important factor in meeting competition in world markets.

I fully appreciate that Britain cannot directly affect the design laws of foreign countries, but at least we can set an example to the rest of the world. The leading article in today's issue of Design sets the matter out very clearly. It says: Most informed people agree that the existing law on the protection of industrial designs (the Registered Designs Act, 1949, amended by the Copyright Act, 1956) is out of date, time consuming and ineffective. It was because of this that in 1959 the President of the Board of Trade set up a departmental committee, under the Chairmanship of Kenneth Johnston, Q.C. to review the law as it now stands and to recommend what changes were needed. The Report of the Johnston Committee was published in 1962, since when it seems it has been quietly forgotten. At the time of going to Press"— this is very recently— a spokesman at the Board of Trade said that there were certainly no plans to bring the Report before the House. This merely confirms what the Minister of State, Board of Trade, said to me on 22nd September after I had written asking me if he would do something about this very serious problem. He said I … accept that the introduction of a copyright type system of protection, as recommended by the Committee, would give the toy and similar industries a better opportunity to protect their designs against copying than is provided under legislation now in force. But, as I said in the House on 14th July, it is not that we are reluctant to introduce legislation but a matter of finding time in a crowded legislative programme. I am sorry that I can give no promise about the possibility of bringing in new legislation, and I doubt very much, therefore, whether anything would be gained from a discussion". The purpose of my seeking this Adjournment debate is to ask the Minister 468 to reconsider that decision. I accept that the legislative programme is crowded. Nevertheless, this matter is of great importance for the export trade which we must encourage in every possible way, and much more important, therefore, than the London Government Bill, irrelevant in terms of exports, which has occupied the House for so long and more important than the Iron and Steel Bill which has occupied all of us for far too long.

I urge the Minister to take action. Will he now dig out the Johnston Report and implement it as a matter of urgency? I do not suggest that implementation of the Report will completely stop the abuse, but it would greatly simplify the procedures for international protection and, furthermore, it would enable Great Britain to join The Hague Agreement under which a single deposit in Geneva would replace the present need for separate registration in each country. The leading article in Design which I have already quoted rightly points out that other countries outside the Agreement are waiting for Great Britain to give a lead. Above all, it would be an act of support and encouragement for British designers and manufacturers who are fighting for our country in the markets of the world at a crucial point in our history.

§ The Minister of State, Board of Trade (Mr. George Darling)

I am grateful to the hon. Member for Croydon, North-East (Mr. Weatherill) for raising the important matter of how best to safeguard our manufacturers' designs. He gives me an opportunity to say that for the past two years Board of Trade officials have been trying to help me to find satisfactory solutions to the problems which he has raised. We agree with his approach to the matter and have no quarrel with any of the arguments he has advanced. We, too, want to put the law and the administration right so that the industrial designs of our manufacturers can be properly protected against what the hon. Gentleman has called piracy by manufacturers overseas.

The task of finding satisfactory solutions which will appeal to and satisfy all our manufacturers—as the hon. Gentleman probably knows, there are some who would disagree with his approach—has turned out to be far more difficult 469 than I expected. I began with, perhaps, an innocent approach. It seemed to me that it should be easy to lay down rules stating that when a manufacturer comes along to register a design, that design cannot be copied. That is how I started off, but the difficulties have subsequently appeared. Even before I began to read it, the size of the Johnston Report sounded a warning note to me. The Johnston Committee, which went into the whole matter most thoroughly, produced 59 recommendations, very sensible, constructive and practical recommendations in an excellent Report.

Incidentally, I do not understand the final sentence quoted by the hon. Gentleman from the leading article in Design: At the time of going to Press, a spokesman at the Board of Trade said that there were certainly no plans to bring the report before the House. The Report was presented to Parliament by the then President of the Board of Trade—it says so on the cover—in August, 1962, so that we have all had an opportunity to study the recommendations.

If the 59 recommendations of the Johnston Committee are to be implemented in one piece of legislation, it will be a major Bill. I ask for your indulgence for a couple of sentences, Mr. Deputy Speaker, because I must mention the problem of legislation in order to come to the difficulties of administration and consider whether these difficulties can be overcome. Whether or not such a big Bill could be prepared and introduced in a reasonable period of time is not a matter for me alone—it is part of the general legislative programme—but it would certainly take time, as the hon. Gentleman appreciates, merely to have the legislation properly prepared. We have, therefore, been looking at the possibility of introducing what might be called an interim Measure. It would be a shorter Measure which, for the time being, would leave the existing and admittedly imperfect legislation as it is, but would add to it a simpler system of copyright protection.

Although the hon. Gentleman has dealt with some of the ways in which the international arrangements work, I think that I should for the record explain how the system operates now. I take, first, the patenting of inventions. A manufac- 470 turer's rights, which are called industrial property rights, normally depend on his taking action to protect his rights in each country in which he hopes to enforce them. Regrettable as it may be, if a British manufacturer wishes to protect an invention in, say, six countries, he must make application for a patent in each of the six countries. Equally—though I do not think that we get much advantage here—a manufacturer in this country is free to make use of the inventions of manufacturers overseas, even though they have obtained their patents abroad, if no patent for such inventions has been sought and granted in this country.

The present system is not satisfactory, and, for a number of years now, in the Council of Europe and elsewhere, we have been exploring with other countries schemes whereby a single patent application in a central office would provide at least prima facie monopoly rights in a number of countries. The Common Market countries have produced a draft of such a scheme, and we have said to them that if, as seems likely, the final provisions of the scheme are acceptable to us, we would wish to join provided, of course, that we join as full members having an equal voice with the others in patent-granting procedure. Unfortunately, that scheme is in abeyance at present because of disagreement among the Common Market countries as to certain of its terms. We must wait to see what happens on that front. There must be international co-operation; otherwise, we cannot make much progress.

The same principle of territoriality, if I may use that word, applies to the protection of designs and trade marks. Perhaps the hon. Gentleman will agree that we can leave trade marks on one side and concentrate on designs. Here, too, protection must be sought and the design registered in each of the countries in which the manufacturer wishes to protect his rights. There are, however, in this field arrangements whereby a design can be deposited, as the hon. Gentleman said, with the secretariat, in Geneva, of the Industrial Property Convention. The secretariat will then transmit the design to the authorities in the member countries, where it is dealt with as though it were a direct application in each of the countries concerned.

471 Generally speaking, these arrangements are designed for the needs of those countries which do not, as we do—this is the first complication—make a search for anticipations and for conflicting designs before registration. Our Patent Office does that searching job, and it is impossible under our existing law to join the Arrangement on international designs known as the Arrangement of The Hague, because of the way we set about the job ourselves.

It is a difficult problem for us to deal with, because our design protection is based on what is called a "novelty approach". A design is not registrable, and therefore does not become protected, unless it is new, that is, unlike anything which has gone before. A search is made in the Patent Office to seek to ensure, as far as is reasonably practicable, that the application for registration is for something that is new. Under the international arrangement which the hon. Member asks us to join, the Patent Office would never receive the representation of the design which it needs for a search in this country, because that is not the way the other countries work, and therefore, membership is impossible for us at the moment.

That is where we must return to the question of legislation. Under our novelty approach to design protection, once a design is validly registered the proprietor has a monopoly, that is, he can stop the marketing here of articles bearing his design without the necessity of providing that the infringer copied from him. The evidence given to the Committee on Industrial Designs, the Johnston Committee, revealed that many of the present users of the existing system were satisfied with its essential features and did not want them changed. But the Committee felt—and we accept this—that the present system is not suitable for certain industries, including those which the hon. Member mentioned, particularly those producing toys and models. The requirement that a design must be new makes it difficult for manufacturers of models of existing things to obtain a registration at all, because in making a model of a train, an aircraft or whatever it is, their model is not new, and it is necessary to prove that the model they are making is a new thing. Without registration, a 472 manufacturer has no protection unless he is a party to such a scheme as the furniture manufacturers in this country operate among themselves.

The Johnston Committee, examining the problems thrown up by this approach by certain industries, recommended, in addition to certain changes in the existing system, a new sytem of protection to be known as "design copyright" which would be additional to, and not in substitution for, the existing system. That is what we are trying to take up. It would mean that the test for protection would be that the design in question was original in the sense that it was the designer's own work, and no search for novelty would be made by the Patent Office when a representation of his design was lodged there; it was his own work and, therefore, there could not be anything like it. The proprietor's rights would be only against copying, and it would be a defence for an alleged infringer to prove that he arrived at his design independently—that is, without copying either directly or indirectly the design of the person who claims that he is the originator.

We think that such a system would be more suitable than the existing system for certain industries, but if other industries want to work under the existing system, that is all right. Whether it would be equally suitable for, say, the protection of furniture designs in this country is open to doubt. That is something we would have to discuss with the furniture manufacturers; and whether we produced the right legislation if we adopted that course would perhaps depend on the first few decisions the courts would have to make in cases of alleged infringement.

At any rate, it would have the advantage—the hon. Member hinted at it, but I would like to stress it—that it would enable us to join The Hague Arrangement for the protection of designs, and hence enable our manufacturers more easily to gain the protection they want in other member countries, but only the member countries, of that Arrangement. They include four Common Market countries and some others, but not the United States of America, none of the Scandinavian countries and not Russia or Japan.

Whether those countries will follow the example Japan is showing, without coming into The Hague Arrangement, remains 473 to be seen. In recent years, the Japanese authorities have been very understanding about the desirability of controlling design copying, and have done a great deal in their own country to stamp it out even in cases where the foreign manufacturer has not registered his design in Japan but has merely made a complaint.

The full recommendations of the Johnston Committee would involve a great deal of amendment of the existing law, but we think that if we could proceed with a short Measure, which would take up less Parliamentary time, we would leave the existing system unamended and add to it the simpler copyright system that I have mentioned. No doubt these Wednesday morning sittings will help generally in providing extra Parliamentary time for the consideration of legislation.

The hon. Member mentioned the reply I gave to a Question from his hon. Friend 474 the Member for Merton and Morden (Mr. Atkins) about when it can be done. We answered about 35 Board of Trade Questions on that day, and as I went through them, helping to prepare the Answers, I was struck by the fact that in those 35 Questions hon. Members on both sides of the House asked the Board of Trade to introduce 10 new pieces of legislation. If we asked them to sort out their order of priority, I do not know where this would appear. I agree with the hon. Member that this question of copying is tremendously important. Perhaps if he can keep up his pressure he will persuade all the other hon. Members who want Board of Trade legislation quickly on a vast range of subjects to put this matter at the top.