HC Deb 07 November 1996 vol 284 cc1375-89

4.5 pm

Madam Speaker

We now come to motion No. 1. I call Mr. Secretary Lang—I am so sorry, Mr. Ian Taylor, whom I know very well. He is a most important Minister.

The Minister for Science and Technology (Mr. Ian Taylor)

I beg to move, That the draft Copyright and Related Rights Regulations 1996, which were laid before this House on 11th July, in the last Session of Parliament, be approved. Madam Speaker, you quite raised my pulse rate with that instant promotion.

The regulations implement two European Community copyright directives on satellite and cable broadcasting, directive 93/83, and on rental, lending and other rights related to copyright, directive 92/100, and also aspects of directive 93/98.

The directives harmonise rights in areas such as the rental and lending of copyright works, other uses of works, such as broadcasting of sound recordings and cross-frontier satellite broadcasting and cable retransmission. Most of those rights already exist in the United Kingdom, and the directives in many cases raise the standards of protection elsewhere in the European Union to those that exist here. So, although the directives require changes to UK law, they will be of substantial benefit to important UK industries, such as the record industry, by establishing similar and improved rights throughout the European Union.

Many, often complex, changes are nevertheless needed to bring UK law fully into line with the directives. The main changes include, first, the extension of rental and lending rights to all copyright works, whereas at present they apply only to books, computer programmes, films and sound recordings. Secondly, they give authors and performers rental and lending rights in films and sound recordings, which at present only producers have. Thirdly, they give performers rights in relation to broadcasting and public performance of sound recordings.

Extensive consultation with all interested parties—about 200 representative bodies—has been undertaken, and we have tried to find a balance that is fair to them all, which means, inevitably, that not everyone is completely satisfied.

That consultation and the complexity of the provisions has, regrettably, led to delays in implementation of the directives, which is now overdue. Implementation of the rental directive should have taken place by 1 July 1994 and that of the cable and satellite directive by 1 January 1995. We are not alone in the EU in being late. I apologise to the House, but the delay has been due to the complexity of the matter.

As there are many issues on which I could now address the House, which would take considerable time, and as I would be interested to hear which of the many aspects interest Members, I will undertake to respond to all the points raised, if I catch your eye, Madam Speaker, at the end of the debate.

4.8 pm

Mr. Geoffrey Hoon (Ashfield)

I thank the Minister for his brief—I am tempted to say terse—outline of a statutory instrument, which, as I understood it, implemented three directives: the rental directive, the cable and satellite directive, and residual parts of the duration directive which were not dealt with when that directive was substantially passed into British law.

I make it clear at the outset that the Opposition do not intend to vote against the regulations. However, it is equally clear that there is profound dissatisfaction with the way in which they have been drafted. That is obvious from the various representations that I have received. It is clear that, in dealing with copyright, the Government have been uniquely successful in once again bringing together different organisations that historically have very different perspectives but are consistently concerned about the way in which the proposals affect both individuals and the industries in which they work.

My first general question to the Minister is whether it is appropriate to deal with three different directives in a single, and inevitably complex, statutory instrument. Why could we not have dealt with the directives separately and had three separate statutory instruments dealing with each aspect at the European level? Alternatively, given the delay that we have faced, why not deal with all outstanding copyright matters in a comprehensive piece of primary legislation?

I am sure that the Minister is aware that the main criticism levelled by the various organisations affected is that they do not have the opportunity to amend the proposals. There are detailed points of criticism that cannot be dealt with in this kind of debate. Given the lack of any substantive legislation from the Department of Trade and Industry, I am sure that the Minister would welcome the opportunity to do something substantial as he whiles away his time before the general election.

My second general concern is with timing. The Minister has already made the point that the legislation is woefully overdue. The statutory instrument was laid on 19 July this year and is therefore more than two years late, as the directives' implementation date was 1 July 1994. What is the reason for the delay? I do not make that point simply to dwell upon the lack of timeliness or competence on the part of the Minister's Department, but it is relevant to the general question of whether the legislation is needed today.

We are debating directives that were agreed in 1992. Therefore, given my understanding of the processes of the European institutions, it seems reasonable to suggest that the directives were drafted in the mid-1980s—probably based on a perceived need in the early 1980s. Given the pace of technological change, the real question for the Minister is whether we should be addressing perceived needs in the early 1990s and those of the next century rather than conducting an historical debate about proposals that were drafted in an earlier age.

As the Minister said, the principal purpose of the rental directive is to provide new rights for creators and performers to earn additional revenue from rentals and lending. My third query is whether the statutory instrument succeeds in translating that aim properly into law. In the explanatory recitals, the directive states: Whereas the creative and artistic work of authors and performers necessitates an adequate income as a basis for further creative and artistic work… Whereas the equitable remuneration must take account of the importance of the contribution of the authors and performers concerned to the phonogram or film". The directive's specific purpose is to ensure that the rights of performers are properly recognised in law.

Performers are clearly concerned that, far from generating new income for them, the statutory instrument is likely to place an inappropriate financial burden on the kinds of small businesses operated by many creative individuals who should benefit from the rental directive. There is concern about the expenditure likely to be incurred by authors and performers having to refer constantly to the Copyright Tribunal and to the courts as a result of this statutory instrument.

There is particular anxiety about the requirement for authors and performers to give notice before 1 January 1997—which is not far away—of any intention to exercise their right to remuneration where rental arises from agreements concluded before July 1994. That places an unnecessary burden upon them in terms of time and cost. The Minister might explain how notification will be given. Will it cover all the agreements before July 1994 or only those made between July 1992, when the rental directive was adopted, and July 1994?

Similar anxieties are expressed on behalf of performers about the meaning of equitable remuneration. How is that to be calculated? Would it not be appropriate for authors and performers to have the right to information, to allow them to calculate the basis for that which is meant by equitable remuneration?

The fairness of such payments from users, and broadcasters especially, to performers is generally speaking adjudged by statutory tribunals or courts, which examine the value of the right to the users, the extent and profitability of the use and the economic circumstances and prospects of the user. The formula in the statutory instrument does allow performers, individually or collectively, to take the user to the Copyright Tribunal on these questions, but only the copyright owner of the record.

A clear criticism of the proposals is that United Kingdom performers will be the only performers in the European economic area, not just the European Union, in such a disadvantaged position. Is that consistent with the intention that is behind the rental directive to provide a consistent approach across both the European Union and the European economic area?

It seems clear that article 182 is not properly translated into British law by regulation 20. The statutory instrument provides for the performer to exercise his or her rights to equitable remuneration solely against the record company and not against the user. Now that I have the Minister's full attention, I should be grateful if he takes up that matter. The statutory instrument fails to ensure that it is the user who should pay the equitable remuneration for the use of a record in any communication to the public. That is different from the arrangement in any other European member state.

A practical problem for performers is obtaining appropriate remuneration due to them in other countries. They clearly have a legal right under the directive, but they believe that it will be difficult and expensive to enforce. I would be grateful if the Minister could inform us of any steps that he might be prepared to take to assist United Kingdom-based performers to secure the rights to which they are entitled, given that it is his legislation that is responsible for causing the difficulty that I have outlined.

All other European countries allow the collective administration of performers' rights as against users' collective organisations. In the UK, only record companies and their organisations will be involved. That means that performers will be placed in an inferior position compared with their continental counterparts. It means also that the United Kingdom is out of step with every other system in the European Union. As it is United Kingdom music that is widely played and listened to throughout Europe, it is unfortunate that we are not giving our performers and creators of music in the UK the same rights as are available to performers from other countries.

It is clear that the identification of users and their uses of records is relatively straightforward. Performers, however, will face considerable difficulty in identifying the owners of the copyright in all the records used and in enforcing their rights against dormant or insolvent owners.

A further problem with the translation of article 182 concerns section 72 of the Copyright, Designs and Patents Act 1988. Article 182 clearly requires payment of equitable remuneration by the user if a record is used in broadcasting or for any other communication to the public. That is both direct and indirect broadcasting. Section 72 provides that when a broadcast is shown or played in public to an audience that has not paid an admission fee, there is no infringement of copyright in any sound recording which is included in the broadcast.. That limitation does not apply to the rights of authors, and it is almost unprecedented in other European countries.

I should be grateful if the Minister would explain why it is possible to introduce the statutory instrument without dealing with section 72 of the 1988 Act, because it is clear that the directive deals with both direct and indirect broadcasting. Indeed, if section 72 were to continue, there would be a continuing cost to performers. To repeat the point, if the purpose of the statutory instrument and the directive on which it is based is to provide greater revenue for performers, it seems unfortunate that that aspect has not been dealt with.

Indeed, if we pursue the statutory instrument without some later amendment, the United Kingdom will be out of step with all other European countries. Only the United Kingdom, Ireland and Greece have a section 72 exemption or its equivalent. It is significant—I hope the Minister will agree—that Denmark used to have a similar exemption but repealed it on the basis that it was necessary to implement the rental directive properly and to meet its Community obligations. There will be important economic consequences—estimated to be in the order of £80 million loss of income to performers and rights holders—as a result of failing to repeal section 72.

There is a further area in which performers' and authors' rights are not protected in the statutory instrument in the way in which the rental directive at least contemplated. Article 5(6) of the rental directive includes an optional provision for member states to provide for a presumption of transfer of authors' rental rights to the film producer. In regulation 12 of the statutory instrument, the Government have chosen to implement this option. I should be grateful if the Minister would explain why it was not possible to leave the assignment of the copyright to be freely negotiated between the two sides. Why is it necessary to rely on the presumption in the statutory instrument? How can that be reconciled with the requirement of the 1988 Act, which says that copyright assignments must be in writing?

Regulation 14 establishes the right to equitable remuneration payable by a person to whom the right is transferred or any successor in title. One of the problems for those engaged in the film business is that many film companies are formed simply for the purpose of producing a particular film, after which they have no continuing existence. Moreover, not all of them are successful, and clearly there are difficulties in enforcing rights against bankrupt organisations. Would it not be more sensible—this is the practical suggestion made by those affected—to allow that right to be exercisable against all those who benefit commercially from the rental process, including the rental outlets?

I have a final technical question concerned with satellite broadcasts, in particular the way in which the statutory instrument affects CNN International and other satellite channels that use similar means of distributing their programmes. CNN International is edited in Atlanta. It is then transmitted to British Telecom in the United Kingdom, which simultaneously uplinks the signal to the Astra satellite for pan-European broadcast. Paragraph 6 of the statutory instrument deals with satellite broadcasts made from non-European economic area states that do not provide a specified level of protection.

The concern is that, since the United States would not provide the specified level of protection, this clause would operate in relation to CNN International's broadcasts. That would mean, according to the rules, that BT, which provides CNN International's uplink facility, would be defined as "the person making the CNNI broadcast", pursuant to the proposed section 6(A)2(b) of the statutory instrument. Because of that definition and the rather artificial way in which it is constructed, the anxiety is that the statutory instrument could be interpreted as defining BT not only as the maker of the broadcast for infringement purposes but as the owner of the copyright in the broadcast. That is clearly not the directive's intention, but I, and I am sure CNN, would be grateful if the Minister would clarify that.

I have made a series of technical observations about the statutory instrument's drafting, but it is necessary, in conclusion, to make some more general observations about the way in which the Government have approached the important area of copyright.

The United Kingdom clearly has an opportunity here to make a significant contribution to Europewide and worldwide technological initiatives aimed at establishing secure electronic trading and providing protection for intellectual property of all kinds. As we move into a digital world, copyright protection will be crucial to allowing our industries, based on the development of intellectual property rights, to flourish and to compete around the world.

It is unfortunate that, in drafting the statutory instrument based on the directives, the United Kingdom has not been able to provide an approach consistent with that of our European partners, and we could not blame them if they looked elsewhere when standards were being decided. It will be unfortunate if we have domestic legislation which appears to have been drafted in such a way as to circumvent certainly the spirit of the directives when later we want the co-operation of our European partners in drafting legislation that is to the benefit and protection of performers and creators based in the United Kingdom.

As I have said, it is unfortunate that we are debating matters now which could have been dealt with many years earlier, when the pace of technological change has brought up many different issues. The key issue that we have not yet faced is digital distribution. That should be the underlying issue. Is the Minister confident that the existing copyright legislation will be sufficient to deal with the rather more complicated intellectual property that will arise as a result of the digital distribution of a wide variety of intellectual content?

Those matters will be discussed shortly at a conference in Geneva as part of the World Intellectual Property Organisation's debate. It is trying to establish standards now which will affect the way in which digital distribution develops. It is clear that the content providers, those who are responsible for creation and performing, will not be willing to see their talent exploited unless they are properly protected by the legislation that needs to be brought forward.

I hope that the Minister will tell the House that the Government are actively pursuing the matter, are concerned to see a proper protection for intellectual rights, and are not simply belatedly enforcing legislation agreed at the European level which is looking increasingly out of date.

4.25 pm
Mr. Andrew Miller (Ellesmere Port and Neston)

My hon. Friend the Member for Ashfield (Mr. Hoon) made two suggestions to the Minister about potential ways forward. One was to deal separately with the different parts of the statutory instrument stemming from three different directives, and the other was that the Government should bring forward comprehensive primary legislation on the matter. I shall seek to explain why my preference is strongly towards my hon. Friend's second proposal.

During the passage of the Broadcasting Bill in the previous parliamentary Session, I suggested to the Minister, and I think that he agreed with me, that our parliamentary process has a fundamental weakness when it comes to dealing with matters such as this where the technology is moving so incredibly quickly. The context of that remark in relation to intellectual property is obvious. Given the development of digital signals, it is easy to envisage ways in which people will be able to bypass attempts to protect copyright, as readily available technologies are open to misuse.

The Minister will be pleased to hear that in a speech at the opening session of Telework 96 in Vienna on Monday I extended to all Parliaments my criticism of the Government's attempts to deal with this problem. All owners of intellectual property face a major problem in the digital age.

My hon. Friend the Member for Ashfield cited an extremely good example of the problems we face when he referred to the CNN equation. The same applies to all existing broadcasters. One can also envisage the existence of a rogue broadcaster—the next century's version of Radio Caroline. It would be easy to bypass any attempt to regulate copyright on a world basis simply by setting up just offshore and buying a piece of satellite space.

This is a serious issue, and it has enormous implications for musicians, authors and writers of software, and for every other signal that can conceivably be transmitted in a digital form. The important discussions that are taking place in Geneva through WIPO—an appalling acronym—should be uppermost in our minds.

Will the Minister tell us what contribution the Government are making to those important discussions? How will we persuade not only the countries that try to restrict incoming signals, but those that take no notice of existing copyright regulations on hard copy to participate in a regulatory regime that will work? As is often the case, we will end up having a local debate on whether one nation or another in the European Union has failed to address its responsibilities. We will not deal with the underlying problem, which is of enormous proportions: the ability of a nation or a company to bypass any attempts to regulate.

Other matters that are currently subject to directive considerations overlap into this area—some slightly and some significantly. Data protection must be carefully considered. How do we ensure that the two-way trade between ownership and protection of information is properly balanced? In another capacity, I sent a strongly worded recommendation to Members of the European Parliament on the draft directive on telecommunications data protection urging them to slow down or, preferably, to stop that directive. It strikes me as a very uncompetitive approach, which, although it may be to the advantage of Deutsche Telekom, certainly will not benefit companies in this country.

All those aspects are linked. The missing part of the equation is a strategic overview from the Government. I do not claim that the issue is simple, and the Minister will understand that I am not trying to score a cheap political point; but we have a real problem. Although we pick away on a piecemeal basis at the various issues—all of which stem from the power that will rest with the potential abuser of digital information, and all of which are closely linked—there seems to be no over-arching Government strategy.

Nor is there such a strategy from the European Union, whence the directives came. It would be helpful if the Minister could explain in detail what representations have been made in respect of procedures currently taking place in the European Union—and, indeed, in the Geneva talks, which are of the utmost importance.

If we fail to address those important matters, we shall do a massive disservice to a very large revenue earner in this country. It is not simply finding a bureaucratic solution to satisfy the whims of the drafters in Brussels that should concern us; we should be worrying about how properly to protect the important people to whom we owe so much—the authors of music, software and all sorts of technical journals whose copyright will be at risk if we do not solve the overall problem.

I hope that the Minister will be able to give some comfort to those of us who are just a little worried about the fact that we are rushing headlong, at an unstoppable pace, into a new era of communication with one missing element: a Government strategy that will make it work.

4.37 pm
Mr. Tony Banks (Newham, North-West)

I know that my hon. Friend the Member for Ashfield (Mr. Hoon) has already mentioned this point, but I should like the Minister to comment. It relates to matters arising from a letter that I received from Dennis Scard, general secretary of the Musicians Union. I know that the Minister has corresponded with the union, and, indeed, with hon. Members who written to his Department following representations received from it.

The union makes it clear that some changes have been made in response to our representations'", and it is obliged to the Minister for that. It regards those changes, however, less as concessions than as an indication that the earlier drafts did not meet the objectives of the Directive or the realities of the situation. The general secretary expresses his union's disappointment that that is still the case in the key issue of who the performers' right is against and the equality of that right compared to the record producer. The letter continues: The Minister concedes that the term 'equitable remuneration' means a fair payment in relation to the use of the record. The fairness of such payments from users—(e.g. broadcasters) to rights owners (e.g. performers) is judged between the parties in every country, including the UK, by statutory tribunals or courts which examine the value of the right to the user, the extent of profitability of the use, and the economic circumstances and prospects of the user. The union makes it clear: The formula adopted in the Statutory Instrument does not, however, allow the performers, individually or collectively, to take the user to the Copyright Tribunal on these matters, but only the copyright owner in the record. UK performers will be the only performers in the EEA in this disadvantaged position. Is that the Minister's reading of the position? If so, and if performers in the UK will be treated differently from any other performers in the European Economic Area, will the Minister kindly reconsider the matter and find out what he can do about it? Thank you, Madam Deputy Speaker.

4.40 pm
Mr. Ian Taylor

This has been a constructive debate about some complex issues and about the future of the digital age. I shall try to touch on the questions and the issues of the future.

The directives are brought together in the statutory instrument because they closely interrelate. They were not tabled by the European Union at the same time, hut, by the time we got around to it, they affected the same Act—the Copyright, Design and Patents Act 1988. Frankly, it was just more efficient to do it this way. We should also bear it in mind that we consulted with the same dramatis personae on each of the directives. It was easier to consult on the directives at the same time than to do so consecutively, and the directives are overdue, largely because we have had such a complex and lengthy consultation. These are difficult matters to draft into UK law, as has been recognised by the hon. Members for Ashfield (Mr. Hoon) and for Newham, North-West (Mr. Banks).

I know that the Musicians Union was worried about whether we had fully implemented the directives. There is a difference of judgment on what the directives obliged us to do and who we should target in relation to the use of exercisable rights. Only record producers in the UK have had rights enabling them to obtain royalties from users. We do not consider it desirable to disturb the traditional relationship between producers and end users. Granting performers rights would have disturbed the traditional pattern and would have meant, in effect, restructuring producers' rights. We felt that not disturbing that traditional relationship was the best way forward, and that has been reflected in our interpretation of the directives.

The Musicians Union also raised with us the issue of the percentage share. Performers are granted a 50 per cent. share, usually in respect of traditional forms of broadcasting and performance. The rights that are being granted in the UK will apply also to newer forms of exploitation that are emerging, but that have yet to become established in practice. In those changing circumstances, we are reluctant to prescribe a share.

This deals with another point that has been mentioned in all three speeches. We must try to anticipate changes in the market. It is clear that 50 per cent. would not necessarily be appropriate in relation to all the future technological means of delivery. For traditional uses of recordings, however, we understand that producers have already said that they are willing to share royalties on a 50:50 basis. Clearly, therefore, other means of distribution would be subject to negotiation.

Further questions were asked about the difficulty in obtaining payments from other European Union states unless rights in Britain are similar to those elsewhere. Again, the directive does not require any particular form of implementation, and we have had to make judgments as to what is most appropriate in Britain. In many cases, the rights that are referred to elsewhere in the EU again relate to rights for traditional broadcasting matters, not some of the newer ways in which we are likely to be engaged. There could be a collective negotiation of reciprocal arrangements, with performers collecting remuneration in other EU countries. The UK Government are prepared to take up any problems in obtaining remuneration with other EU Governments, as we have done when necessary.

There was a question about the exception to public performance rights in relation to sound recordings in section 72 of the 1988 Act and why that measure was not repealed, as some believe the directive seems to require. The directive does not expressly require us to repeal it. We consider it undesirable in any event to remove such a specific exception, approved by Parliament during the passage of the 1988 Act, without an equally express exclusion provision under the directive or other measure.

Our legal advice is that the exception in section 72, which is in respect of sound recordings contained in broadcasts seen or heard by non-paying audiences, is within the limitation to record producers' and performers' rights permitted by the directive. I am aware that record producers are concerned about the impact of section 72 on their economic interests, now that broadcasts are replacing the direct playing of sound recordings in certain retail outlets, but we do not consider that repeal of section 72 is an appropriate way in which to deal with any difficulties, particularly as it would also impact on other very different situations. In any event, the Copyright Tribunal is likely to deal with what is the appropriate royalty level for use of sound recordings in broadcast services specifically tailored to retail outlets.

Mr. Hoon

The Minister has mentioned the interests of record producers, but are not performers, record producers and, most significantly, record companies all united in asking the Government to reconsider section 72 because of those groups' clear concern about the impact on their income?

Mr. Taylor

There was pressure on us, but pressures would arise in following other courses. The retail trade, for example, is developing various ways of using music in their outlets. Repeal would be an extremely restrictive practice and, in the long term, it would not necessarily be in the interests of any of the parties concerned, which is why we have continued the exception in section 72, which was debated in the Standing Committee on the Copyright, Design and Patents Bill.

Mr. Hoon

Surely, if the retail trade or other organisation—restaurants, cafes, public houses, and so on—chooses to use music, particularly broadcast music, it should pay an appropriate fee for the use of that music. It paysa fee if it uses specialised music services. Why is there a distinction between the use of specialised services and the use of broadcast music?

Mr. Taylor

We should bear it in mind that, often, such organisations do pay a fee—to the broadcaster. We are not removing the exception in relation to the further reproduction of that music in any retail outlet. We consider that to be a sensible way forward, and therefore we have not made the changes that the hon. Gentleman has requested. It was a fine balance, but, having heard all the arguments, I decided that that was the right way forward. The Copyright Tribunal is considering the matter.

The hon. Gentleman talked about equitable remuneration for rental and how it is defined. The directive did not define "equitable", as what is fair in one set of circumstances may not be so in another. Nor, therefore, can the regulations set that out, but they do provide that remuneration is not to be considered inequitable simply because it is paid in a single sum or at the time an author or performer transfers his exclusive rental right to a producer—the directive says that the remuneration may be paid in either of those ways. Again, the matter will need to be tested by the Copyright Tribunal, were there to be a dispute.

Mr. Hoon

I accept that the directive does not, in any event, define equitable remuneration, but I made the point to inquire of the Minister whether he thought it appropriate that performers in particular should have the means to ascertain the information that would allow them to find out whether they were receiving equitable remuneration—information about the number of times that the music in question was used, the circumstances of the user, the number of times and the form in which the music was reproduced, and so on. That would allow them to build the sort of picture of remuneration that is obviously available to users.

Mr. Taylor

Obtaining the proper information is a matter for the traditional negotiations with producers. As we move forward, there will be cases in which producers may not have negotiated a particular package based on what they would regard as full remuneration, simply because of the commercial opportunity, but the regulations give performers increased rights to claim an equitable remuneration from producers. We have taken steps to help the producers, and I have tried to explain that to them. The assumption about the transfer of authors' rental rights in films to producers—a point raised by the hon. Member for Ashfield—received careful consideration.

Throughout, we have tried to err on the side of there being a proper way to get works to market without undue complexity. We certainly do not want to put a burden on any rental outlets, many of which are small businesses. We have had to make a decision about who are authors and about the respective rights of performers. On balance, I think that we have got it right. The statutory instruments were tabled on 11 July, and we have had extensive consultation since then. I am aware of the arguments.

The hon. Member for Ashfield raised a number of minor points on which he wanted guidance. For the sake of brevity, I shall write to him on those. However, he raised a serious point about the position of uplinks within the European Economic Area, from one area to another. It is a complex matter. We have attempted to apply the copyright law from the place from which the signal has been broadcast. Of course, there will be certain safeguards for countries if the uplinkers come from outside the EEA. Again, it is a matter of giving some comfort to the broadcasters about which copyright law applies.

I do not have details to hand about the specific case of how Cable News Network would be affected, but I am concerned about the possible effects on satellite uplinks. That point has been clarified in the regulations by reference to the use of the law of the country from which the signal originates.

Mr. Hoon

It would be helpful if the Minister would say categorically that there will not be any effect on the ownership of copyright. There is ambiguity under the provisions as drafted. I am not questioning the underlying reason behind the drafting; it is simply that, because of the way in which the rather technical provisions operate, there is concern that the statutory instrument could be interpreted as defining British Telecom not only as the maker of a CNN or similar broadcast for infringement purposes—the point just dealt with by the Minister—but as the owner of the copyright in that broadcast. I hope that the Minister will say that that is not the case; that would resolve any ambiguity.

Mr. Taylor

It is not the intention behind the regulations to affect authorship of broadcast or ownership of copyright, and we do not consider that they do so. Regulation 6 states not that the operator of an uplink station is the person making the broadcast, but rather that he is to be treated as such. In addition, we believe that it is clear from the manner in which the regulations are presented that the uplink operator should be treated as the broadcaster only for certain purposes—in relation to clearance of the rights in underlying works in broadcasts identified in regulation 6.

I stress that the regulations must be construed in the light of the directives that they are intended to implement, which similarly have no bearing on authorship or ownership of copyright in broadcast. That is also the approach that will be taken by United Kingdom courts in interpreting the legislation.

The key point is that, in attempting to implement the directives in UK law, we have tried not to disturb traditional relationships. We have tried to make it as simple as possible for content comfortably to flow into the UK market. In many cases, that means that, although we have strengthened the rights of performers and given them an underlying position in negotiations—the right to equitable remuneration regardless of the economic arrangements entered into by the producers—they should nevertheless negotiate with the producer.

The Copyright, Design and Patents Act was far-reaching in its vision of the future. It covers some of the problems relating to the new age of electronic interactivity—video on demand. We are comfortable that we have anticipated ways in which that may evolve as the information society progresses. An important point, which was raised by the hon. Member for Ellesmere Port and Neston (Mr. Miller), is that the European Commission has already published a Green Paper on copyright in the information society. Clearly, further directives that may emanate from that in due course will consider the way in which the electronic age will be accommodated. Before I conclude, I intend to deal with the wider issues that the hon. Gentleman raised.

Mr. Miller

I am a little puzzled about the Minister's remarks relating to proposed section 144A(7) and the definition of cable re-transmission. I am not sure that the definition will meet what the Minister says is the intention. For example, in transmitting a compact disc that has been recorded digitally on to a network server, or in receiving a signal, encoding it oneself and putting it out on to a server through BT networks, who would be in breach of copyright? Clearly, the person doing that would be in breach, but there is some doubt whether responsibility would also lie with BT or the cable provider—or, in the case of mixed provision, a network of people. Will the Minister explain how the definition will work?

Mr. Taylor

In some cases, such matters will have to be tested in the courts. We are talking about issues such as common carriers, whether there is a burden of proof that there was a knowing breach of copyright by a carrier, whether it be a telephone company or a broadcaster; whether rights have been properly obtained; and whether they were knowingly obtained. Quite honestly, it is not for me, across the Floor of the House of Commons, to anticipate how the courts will interpret such matters, but they will need to be tested.

As media convergence comes about, many such matters will be affected. Indeed, the hon. Member for Ellesmere Port and Neston said that, increasingly in the digital age, it would be easy to lose intellectual property. There could be instant quality reproduction. That is why I have been in discussions with companies, not least the Thorn EMI laboratory, about electronic digital signatures, or watermarks, embedded into a chip, which can be picked up only by special monitoring equipment. That equipment can sensibly work out whether any broadcaster is using copyright material that has not been paid for, or material that has been paid for in the proper way. Technological solutions will have to reinforce the law as we make progress.

Mr. Tony Banks

I know that it is not the Minister's job to anticipate or interpret that which the courts might decide, but there is something that he can tell us: are performers in this country challenging the fairness of remuneration treated differently from performers in the other countries within the EEA? Are they or are they not being treated differently from all the other performers in the EEA?

Mr. Taylor

To my knowledge, our performers are not being treated differently from all other performers. There are variations within the EEA, from country to country. Many of the ways in which our performers feel they might be treated differently in fact relate only to traditional broadcast materials. To that extent, we are attempting to provide a flexible way for performers—while still protecting them—to pursue their interests and get equitable remuneration, without specifying that in statute. As we move forward to new distribution mechanisms, we shall quickly find that the 50:50 split is not tenable. It is in the long-term interests of performers for their material to be distributed more widely rather than for it to be carefully restricted and used less. Content will be king in the new age, putting performers in a much better position.

The Government have played a leading role in the development of the wider market. We are active in the preparations for the World Intellectual Property Organisation conference in December. I have had active talks with the various music organisations in this country and in Europe. Rupert Perry of EMI has played a leading role in that. I have recently been to India to talk about copyright issues. One or two European Union countries, such as Italy, do not have a good record on copyright. We are drawing attention to that. We have also had severe problems with China and Bulgaria.

We are well aware of the need for copyright. If intellectual property is not protected, there will not be a content industry capable of dealing with the pressure of public demand. It is also necessary to protect intellectual property by technological means. Electronic signatures, or watermarks, will be essential and there will be a much greater need for monitoring. Intellectual property will be important in the transmission of music, software and programmes. It will be downloadable only in a country in which a performer is confident that his copyright will be protected rather than one without secure copyright protection.

That can be resolved only through the implementation of responsible policies around the world. Sir Leon Brittan will be assisting in the World Trade Organisation talks. Further talks are being held by WIPO. We are putting as steadfast a case as possible, for good commercial reasons. The music industry is one of the few in this country that export twice as much as they import. It is an important player in the national economy and we want to do everything possible to ensure that it and all the other providers of intellectual property gain secure access to world markets.

Mr. Miller

Is the Minister seeking to redefine the traditional meaning of the word "broadcast" in the context of this debate? Will he press for that definition to extend to all forms of digital transmission?

Mr. Taylor

I am cautious about broadening that definition. The hon. Gentleman will well understand that I believe that there will eventually be convergence. Even the BBC has openly announced plans for broadcasting over the Internet. There will be a convergence of all means of transmission—including cable, telephone and satellite. Broadcasters and other content providers, including the music industry, will come together in the new multimedia age.

As I mentioned in the Command Paper issued yesterday in response to the report of the House of Lords Science and Technology Committee on the information society, we envisage looking at the regulatory environment in the context of changing industries. The time is not yet right for that. We have made some pre-emptive moves—for example, through the regulation by the Office of Telecommunications of conditional access as a result of the Broadcasting Act 1996. We are well apprised of the changes and well aware of their significance. It is not sensible to move too far or too fast. We are watching carefully to see where technology leads.

We have to protect copyright and intellectual property. I believe that the measure will do that, and I commend it to the House.

Question put and agreed to.

Resolved, That the draft Copyright and Related Rights Regulations 1996, which were laid before this House on 11 th July, in the last Session of Parliament, be approved.