§ '.—(1) The term "patent attorney" may be used in reference to a solicitor, and a firm of solicitors may be described as a firm of "patent attorneys", without any contravention of section 265.
§ (2) No offence is committed under the enactments restricting the use of certain expressions in reference to persons not qualified to act as solicitors—
- (a) by the use of the term "patent attorney" in reference to a registered patent agent, or
- (b) by the use of the term "European patent attorney" in reference to a person on the European list.
§ (3) The enactments referred to in subsection (2) are section 21 of the Solicitors Act 1974, section 31 of the Solicitors (Scotland) Act 1980 and Article 22 of the Solicitors (Northern Ireland) Order 1976.'.
§ Brought up, and read the First time.
§ Mr. Deputy SpeakerWith this it will be convenient to discuss the following: New clause 15—Authorised persons for purpose of acting as patent agents etc.—
'(1) A person holding an authorisation granted by the Secretary of State under the provisions of this section is an authorised person for the purpose of carrying on the business of acting as agent for others for the purpose of—
- (a) applying for or obtaining patents, in the United Kingdom or elsewhere, or
- (b) conducting proceedings before the comptroller relating to applications for, or otherwise in connection with, patents.
(2) An application for authorisation by the Secretary of State may be made by an individual, partnership or body corporate.(3) The Secretary of State may make rules:—
- (a) regulating the manner in which any such application shall be made and any authorisation granted, and providing for the withdrawal, termination or suspension of any such authorisation, and
- (b) regulating the competence, professional practice, conduct and discipline of authorised persons.
(4) Without prejudice to the generality of the preceding subsection, rules under this section shall:—
- (a) prescribe minimum standards of general education that must have been obtained by persons who seek to hold an authorisation,
- (b) prescribe any education or training to be undergone by persons who seek to hold an authorisation,
- (c) require authorised persons to take out and maintain insurance with authorised insurers, and prescribe conditions which an insurance policy must satisfy, and
- (d) provide for a fund to indemnify members of the public against any losses incurred as a result of the advice or actions of authorised persons.
(5) In subsection (4), "authorised insurers" means a person permitted under the Insurance Companies Act 1982 to carry on:—
- (a) insurance business of class 13 in Schedule 2 to that Act; or
- (b) insurance business of classes 1, 2, 14, 15, 16 and 17 in that Schedule.
(6) Rules under this section shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.'.
§ Amendment No. 18, in clause 263, page 119, line 10, leave out from beginning to 'carry' in line 11 and insert 'A person shall not'.
§
Amendment No. 229, in page 119, line 16, after 'patents', insert
', unless he is a registered patent agent, a solicitor, or an authorised person holding an authorisation under the provisions of section [authorised persons for purpose of acting as patent agents etc.]'.
§
Amendment No. 20, in page 120, line 1, leave out clause 265, and insert—
'(1) An individual shall not practise, describe himself, or hold himself out or permit himself to be described or held out as, or under any name, title, addition, or description which states or implies that he is, a patent agent or a patent attorney unless he is a registered patent agent.
(2) A partnership shall not practise, describe itself or hold itself out or permit itself to be described or held out as, or under any name, title, addition or description which states or implies that it is, a firm of patent agents or patents attorneys unless all the partners are registered patent agents or the partnership satisfies such conditions as may be prescribed for the purposes of this section.
(3) A body corporate shall not practise, describe itself or hold itself out or permit itself to be described or held out as, or under any name, title, addition or description which states or implies that it is, a firm of patent agents or patent attorneys unless—
(4) No individual, partnership, or body corporate shall take or use any name, title, addition or description, nor permit the use of any name, title, addition or description which states or implies that the individual, partnership, or body corporate is authorized by or is in any way connected with the Patent Office.
(5) This section is not contravened by the use of the term "European patent attorney" or "European patent agent" in the circumstances specified in section 266.
(6) A person who contravenes this section commits an offence and is liable on summary conviction to a fine not exceeding level 5 on the standard scale; and proceedings for such an offence may be begun at any time within a year from the date of the offence.'.
§ Government amendments Nos. 108, 284, 285, 109 and 286.
§ Amendment No. 228, in clause 269, page 123, leave out lines 12 to 16 and insert—
- '(c) a person whose authorisation has been withdrawn, terminated or suspended;".
§ Mr. ButcherNew clause 24 and amendments Nos. 284 to 286 concern the use of the expression "patent attorney". At present, this term as such is not in general use in the United Kingdom, although I understand that solicitors specialising in patent matters sometimes refer to themselves as "patent attorneys", particularly when dealing with foreign clients. Patent agents are, however, currently inhibited from using the term by the Solicitors Acts, which make it an offence for an unqualified person to pretend to be a solicitor. It is arguable that the use of "patent attorney" by a non-lawyer would contravene these provisions.
As far as possible, the Bill has attempted to maintain the status quo on the use of titles by those providing patent services in the United Kingdom. However, since it was felt to be highly likely that the newly-legalised unqualified patent practitioners would, in the absence of a specific prohibition, adopt the term "patent attorney" as an alternative to the restricted title "patent agent" the Bill provides that it is to be an offence for a person who is not 98 a registered patent agent to call himself a "patent attorney". The question whether, under the Solicitors Acts, a registered patent agent could do so is left open.
Following representations made to us by the solicitors' profession, we now realise that that approach fails in its objective of maintaining the status quo. In fact, the balance has shifted significantly away from solicitors by banning them from using the title "patent attorney". There are good reasons for allowing patent agents and solicitors to use the title. Following consultations with the professional bodies involved, that is what we have decided to do. I am pleased to say that both the professions are able to agree to the common-sense approach.
§ 8 pm
§ Mr. DoranApparently, word is on the tapes that the Minister will be moving to another job. I congratulate him on that move and I welcome the fact that he is able to complete the Bill. When we realised who was to be his successor, it was a tremendous relief to those of us involved in the Bill that the Minister will be able to see it through.
There is serious concern about what the Government intend to do. At present, the office of patent agent is well known. It is regulated, there are strict entrance requirements and there is registration, which ensures that unregistered patent agents are an unknown concept in Britain. Obviously, solicitors can act as patent agents. After an Office of Fair Trading inquiry in 1986, the Government seemed to have accepted the recommendation that there should be deregulation in this area also. I will not say that I oppose the concept of deregulation: monopolies are there to be broken. If there was a monopoly of patent agents, I would not expect the Government to sit on their hands once the monopoly had been examined.
The Government's proposals have caused severe disquiet. There was a serious and long debate on this matter in Committee and I do not propose to rehearse all the details, because I know that we are under pressure of time. However, it is important to draw out one or two points.
One of the major reasons for breaking up any monopoly would be consumer protection. It is difficult to see that consumers will be protected by this set of proposals. The Bill prohibits the use by individuals or partnerships of the expressions "patent agent" and "patent attorney". However, that will not prevent the spread of what I regard as unscrupulous operators.
The Minister accepted that we would have a two-tier system where those who could afford it would seek the services of the fully registered and qualified patent agent or attorney and those who could not or did not want to afford them could seek advice in a sort of black market, which would be totally unregulated. The only restriction would be that those who practise in that area would not be entitled to call themselves patent agents. That is totally opposed to the interests of consumers. For that reason, we have tabled new clause 15, which would oblige the Secretary of State to seek in some way to regulate that part of the market.
We raised an analogy in Committee, and we had the benefit of the experience of my hon. Friend the Member for Great Grimsby (Mr. Mitchell), who had been heavily involved in what we might regard as the deregulation of 99 the legal profession. He made a significant contribution to the passing of the Administration of Justice Act 1985, which created the new concept of the licensed conveyancer. I took the trouble to check that Act and it is fascinating to see the difference between what is proposed for patent agents and what the Government did in 1985. For patent agents the only restriction is the inability to use the expression "patent agent". There is nothing to say that analogous descriptions such as "patent expert" could not be used. The Comptroller-General of Patents is given the power to refuse to deal with anyone who transgresses in any way.
It is important to look at the 1985 Act. There are 26 sections dealing with the regulation, training, licensing and so on of conveyancers. Patents are extremely complicated. I have had 10 years experience of conveyancing in Scotland and I know that patents are a far more complicated area than modern-day conveyancing. Yet there is to be a totally unregulated market. Individuals will be able to pass themselves off as experts and, without any prior condition, qualification, registration, licence or anything of the sort, they will be able to set themselves loose on the public.
Clause 269 (2) gives the Comptroller-General the power to refuse to deal with certain agents. It gives no redress or compensation for the victims of bad advice or inadequately drafted patents. Often, that will not become known until the damage is done. In Committee we made the point forcibly that there should be a requirement for professional indemnity insurance. The Minister rather glibly dismissed the idea out of hand, on the basis that if anyone wanted to use an unlicensed patent agent, they were entitled to do so. He did not say that it should be necessary to protect the public.
It should be borne in mind that there are other areas where it would be difficult for people to find out about bad advice and so on, until the damage has been done. For example, what about an inventor who is told by an unlicensed or unregistered patent agent that his invention is not patentable? He may accept that advice, because he has chosen to use that patent agent, but he has no redress because the Government do not seek to provide it. There are no provisions for the payment of compensation or the finding of negligence. That will not even come before the Comptroller-General because he will not be exercising supervision over what goes on in the offices.
There are serious matters of public concern, which, as I said, were forcibly and fully expressed in Committee. We seek to allay the fears and the general concern by new clause 15, which would require the Secretary of State to regulate the market. The Government have done that forcibly for conveyancers, and there is no reason why they should not do the same in this equally important area.
§ Mr. ButcherThe issues raised by the hon. Member for Aberdeen, South (Mr. Doran) were looked at in some detail in Committee. However, the arguments bear further examination, although the hon. Gentleman will be disappointed to know that I am no more persuaded of the strength of his arguments now than I was before.
We believe that these proposals are unwarranted and burdensome. The Director General of Fair Trading made it clear in his report published in 1986 that restrictions on those wishing to offer patent services have a detrimental 100 effect on costs to users of the system. He found in particular that under the present system many small firms and private inventors were being deterred from seeking advice. New clause 15 and other amendments consequential to it would ensure that they would continue to be deterred by the establishment of a new burdensome regulatory procedure.
We have said that there should continue to be a register and reserved titles that will signal which practitioners have undergone practical and theoretical training and hold a certain qualification. Such practitioners will no doubt continue to offer a high standard of service, but there should also be competition and choice in the provision of patent services.
We must recognise that those who require patent services are a relatively specialised class of consumer and must surely be credited with sufficient awareness to be able to chose the type of service that they need and can afford. A balance has to be struck between the seriousness of the risks to the consumer and the disadvantages that restrictions entail. Financial risk alone is not a decisive reason for the existence of restrictions. The patents profession is not alone in dealing with complex matters; anyone can offer an architect's services, although not call himself an architect. Anyone can offer legal advice—for example, staff of the citizens advice bureaux do so every day—without being solicitors. The activity and title of accountant are also unrestricted. In such cases, the consumer decides whether to employ a fully qualified practitioner or whether his needs can be met by someone else.
The new clause and its consequential amendments do not merely seek to restrict entry. They seek also to impose rules on practitioners, including the obligation to insure and to provide for a fund to indemnify against loss. That runs directly contrary to the need to create a more competitive environment by allowing a wider range of services and a reduction in costs to develop in response to consumer demand.
Restrictions still exist on the provision of conveyancing. The hon. Member for Aberdeen, South emphasised the need to protect the consumer of patent services from the unqualified, and drew comparisons with controls in that respect. As I have said, we recognise that there are risks involved in seeking advice from unqualified patent practitioners, but we must not lose sight of the fact that patent agents are employed by those whose business, to some extent, is that of inventor. Conveyancing services are used by millions of ordinary people who cannot be expected to have an appreciation of the procedures or risks involved in taking unskilled advice. It will be for the individual practitioner to decide what protection he requires against the possibility of giving poor advice. The individuals who are most likely to benefit from the reduction in costs and the wider availability of advice are those who currently receive no advice at all. It must be for them to choose a practitioner and to decide what value to put upon the protection that he is able to offer.
§ Mr. Lewis Stevens (Nuneaton)Does my hon. Friend agree that many inventors will not necessarily have any great business expertise, but many have an excellent idea? They can easily be dissuaded by an unqualified person from recognising the need for a patent. I should have thought that it is necessary to differentiate much more 101 clearly between those who can act on behalf of ordinary people with an idea and those whose advice can be recognised as having professional status.
§ Mr. ButcherI am grateful to my hon. Friend. As he will know, when we considered the issue in other contexts we usually came to the view that competition coming in from the bottom end of the profession normally has a beneficial effect. My hon. Friend talked about that class of potential users who currently may not wish to go straight to a full-blown patent agent. Many people do not get advice. We are saying that there can be a lower tier of people who do not have a formal and detailed qualification to offer advice to that group of people who most often do not seek the advice that we think they should have. We are convinced that, in this respect as in others, the consumer—in this case, the inventor—gets a wider choice and advice is more widely available to those who need it most, very often an individual inventor or a small firm.
It will come as no surprise to the hon. Member for Aberdeen, South that I am unable to accept amendment No. 20 either. The restrictions in subsection (1) of the proposed new clause are so wide that it would be virtually impossible for anybody who is not a registered patent agent to advertise the fact that patent services were available. Thus the clause would defeat our overall objective of lifting restrictions on who may offer patent services. Similar arguments apply in respect of subsections (2) and (3), which relate to partnerships and companies.
I now refer briefly to subsection (4). I cannot really see why this provision should exist. It deals with misuse of the title patent office or related words. The subject matter is already covered by section 112 of the Patents Act 1977, which is not affected by anything in this Bill. Admittedly, section 112 is framed in different and slightly narrower terms, but we have never received any representations that it is deficient and ought to be extended in scope.
For those reasons I must resist amendment Nos. 18, 20, 228 and 229 and new clause 15.
8.15 pm
Briefly, amendments Nos. 108 and 109 relate back to amendments made in Committee. They were intended to ensure that the use of words related to the protected titles patent agent and patent attorney would also be caught by the clause. We had in mind expressions such as "patent agency". Since then, we have received representations that the amended clause is still too restricted in scope. For example, it has been put to us that, even though the letters "RPA" after a person's name are the normal abbreviation for registered patent agent, as it now stands the clause would not prohibit the use of those letters by an unregistered person.
Although we do not accept that a court would necessarily take that view, it does no harm to put the matter beyond doubt, so we are making these amendments so that the clause will refer to expressions rather than just words.
§ Mr. BlairWe can briefly deal with this new clause, as we had a full debate in Committee. I endorse what my hon. Friend the Member for Aberdeen, South (Mr. Doran) said. We are not against ending the monopoly for patent agents. We are simply concerned to ensure that those who have ideas and may hold themselves out to people as patent experts and patent consultants have some minimum qualifications. The Minister drew an analogy between the 102 staff of citizens advice bureaux and patent experts giving advice. It seemed to be entirely beside the point. Staff of citizens advice bureaux make it absolutely clear that they are giving an informal service. They do not hold themselves out as experts.
Yet, under the provisions of the Bill, if the Opposition's new clause is not accepted, someone can say that he or she is a patent expert or patent consultant, but have no qualifications, no training whatsoever, no indemnity insurance, and absolutely no regulations whatsoever covering them in the conduct of their business. That seems to be wrong. A much better analogy is licensed conveyances. There should be an open, competitive market, but it should be subject to basic rules of protection for the consumer. Our new clause 15 gives such rules and protection, and the Government do not. I ask my hon. Friends to support our new clause in the Division Lobby tonight.
§ Question put and agreed to.
§ Clause read a Second time, and added to the Bill.