Lords Sitting of 29 March 1988

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR Oil the Woolsack.
Prayers—Read by the Lord Bishop of Newcastle.

Civil and Political Rights: UN Protocol
Lord Elwyn-Jones Lord Elwyn-Jones asked Her Majesty's Government:
Whether they propose to accede to the optional protocol to the International Covenant on Civil and Political Rights.
The Minister of State, Foreign and Commonwealth Office (Lord Glenarthur): My Lords, we have no plans to do so. We have accepted the optional articles of the European convention on human rights which recognise both the right of individual petition and the compulsory jurisdiction of the European Court of Human Rights. We do not believe that becoming a party to the optional protocol would enhance the protection of individual rights in this country.
Lord Elwyn-Jones: My Lords, as the United Kingdom has ratified the International Covenant on Civil and Political Rights, should we not also ratify the optional protocol, which enables the human rights committee of the United Nations to examine claims from private individuals, from wherever they may be made, that they are the victim of violation of the rights set out in the covenant? Is it not the case that several states which are party to the European convention are also party to the optional protocol? As a general principle, therefore, should not all instruments of international law be ratified by member states of the United Nations?
Lord Glenarthur: My Lords, I certainly understand the force of that argument. However, we believe that our acceptance of the optional articles of the European convention provides better protection than the optional protocol. Indeed, the machinery of the European convention is binding upon those who sign it, whereas the optional protocol would not be. It is of course true that other countries have made the link and ratified the optional protocol, but I cannot speak for them.
Lord Cledwyn of Penrhos: My Lords, is it not the case that the provisions of the optional protocol go beyond the convention and thus safeguard more rights? If that is so, it is difficult to understand why the Government hesitate. What have they to lose? Is there not a great deal to be gained by taking this one step further, when at least 10 of our friends and allies have decided to sign the convention? I ask what is the real reason for the Government's hesitation on the matter.
Lord Glenarthur: My Lords, the various themes, which are incorporated in the European convention and the international covenant are broadly very similar indeed. I hope that the noble Lord will recognise that we are prepared to consider proposals which strengthen the obligations on states contained in international human rights instruments. We will of course keep the position on the optional protocol under review. However, I must say again that we believe that our acceptance of the European convention provides better protection than the optional protocol.
Lord Kirkhill: My Lords, the other member nations that have signed the optional protocol will accordingly have a view of the British Government's position on the matter. What has the Minister to say to that proposition?
Lord Glenarthur: My Lords, I am afraid I do not have the necessary information to enable me to answer the noble Lord's question directly. However, that may be a question which would be better addressed to the nations concerned.
Lord Elwyn-Jones: My Lords, surely it is extraordinary that this country, having ratified the covenant, is now apparently refusing to take steps to make it a reality and thus enable individuals to complain to the human rights committee, which is doing extremely valuable work. Why are we dragging our heels once again in this field?
Lord Glenarthur: My Lords, for the reasons that I have already explained to the noble and learned Lord, I do not believe that by going down the path which he suggests that we should in fact enhance what he and others would like to see so firmly enshrined.
Lord Mellish: My Lords, will the Minister be good enough to give us details of some of the countries that have already signed the protocol?
Lord Glenarthur: My Lords, 38 states have now ratified the optional protocol, including, Denmark, Finland, France, Iceland, Italy, Luxembourg, the Netherlands, Norway, Portugal, Spain and Sweden. I also believe that Austria and the Federal Republic of Germany are preparing to do so.
Lord Hailsham of Saint Marylebone: My Lords, is there not something to be said for having one acknowledged set of human rights and one tribunal before which such cases can come and not two concurrent and potentially divergent sets, with two concurrent and potentially divergent tribunals, leading to forum shopping?
Lord Glenarthur: My Lords, I think that my noble and learned friend is right; the situation could lead to confusion rather than assisting those concerned.

Unemployment Statistics
2.42 p.m.
The Viscount of Oxfuird The Viscount of Oxfuird asked Her Majesty's Government:
What are the latest figures they have for the level of long-term unemployment.
The Minister of State for Defence Procurement (Lord Trefgarne): My Lords, on 14th January 1988 the number of unemployed claimants who have been unemployed for one year or more in the United Kingdom was nearly 1,101,000. This is of course still far too high, but it is now at its lowest level for over four years.
The Viscount of Oxfuird: My Lords, will my noble friend tell the House how the figures compare with those of a year ago?
Lord Trefgarne: My Lords, as I indicated in my original Answer, the figures are now going downward progressively, very much as a result of government policy.
Baroness Turner of Camden: My Lords, is the Minister aware that recent research indicates that there is substantial depressive illness and even suicide among the long-term unemployed which is much more than in the general population? Should not something be done about that situation?
Lord Trefgarne: My Lords, I am not sure that it is right to ascribe the phenomenon which the noble Baroness mentioned as the only cause of the illness to which she refers. Naturally, we should like to bring steadily downwards the number of unemployed people, which is what we are now doing, because of course the effects of unemployment are most undesirable.
Lord Wallace of Coslany: My Lords, is the Minister aware that although, as he states, figures are dropping as a result of government policy, there was a dramatic rise when the present Government took over?
Lord Trefgarne: My Lords, the rise was initiated by the Government of our predecessors. We had first to arrest that steadily increasing trend when we came into office.
Baroness Carnegy of Lour: My Lords, will my noble friend tell the House what progress the Government are making over the provision of opportunities for adult basic education for those who have been out of work for some time, and whether it has proved effective?
Lord Trefgarne: My Lords, we now have a whole range of training programmes to help the unemployed, including the older unemployed and those who have been unemployed for a longer period. Those training programmes include the provision of basic education where necessary.
Baroness Seear: My Lords, does the Minister agree that the employment of the long-term unemployed,
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many of whom are unskilled, is greatly helped by the increase in employment of skilled people who fill vacancies, of which there are now a considerable number? In other words, when skilled people obtain jobs, with any luck they are likely to carry unskilled people with them. Therefore, will the Minister consider that where unemployment is falling rapidly, as is fortunately the case in many areas, training money, which is allocated only to people who have been out of work for six months in the case of young people, or for over two years in the case of others, should be lowered to speed up the employment of skilled people and by so doing grab up the employment of the unskilled?
Lord Trefgarne: My Lords, I am not sure that I quite understand what the noble Baroness is saying; but, if I catch her correctly, she makes a good point. It is important for all the different categories of unemployed people to have the training that is appropriate to their needs. That is why we attach such importance to the training and the provision of training opportunities for unemployed people. That policy lies at the heart of the recent announcement.
Lord Blease: My Lords, the Minister gave the total figures for the United Kingdom. Does he have readily available the percentage figures for England, Scotland, Northern Ireland and Wales?
Lord Trefgarne: My Lords, I do not have those figures in front of me. I shall happily write to the noble Lord with them.
Lord Stewart of Fulham: My Lords, the Minister referred to adult basic education. Is he aware that one of the best examples of that education is that provided by the ILEA, and that no one knows what will happen to it?
Lord Trefgarne: My Lords, a great many other education authorities provide the type of service to which the noble Lord has referred and which I prefer to the ILEA.
Lord Molloy: My Lords, is the Minister aware that we are gravely apprehensive about the method of calculating the numbers of unemployed? Is he further aware that in the last six months of the Government of my noble friend Lord Callaghan, before the present Government took over, inflation and unemployment were coming down? That can be seen in any statistical research. Should not the Minister read that statistical research and withdraw his earlier statement?
Lord Trefgarne: My Lords, if the noble Lord believes that he will believe anything.
Lord Jay: My Lords, is it the Government's view that when unemployment goes down it is due to the Government, but that when it goes up it is not due to the Government?
Lord Trefgarne: My Lords, I am sorry, but I did not hear the noble Lord's question. If he will put it again I shall try to answer it.
Lord Jay: My Lords, is it the Government's view that when unemployment goes down it is due to the Government, but that when it goes up it is not due to the Government?
Lord Trefgarne: My Lords, unemployment was going up steadily when we came into office.
Noble Lords: No!
Lord Trefgarne: My Lords, when we came into office it was necessary at once to introduce programmes to deal with that position, but because of the depth of the problem it took a little while for those programmes to take effect.
Lord Stoddart of Swindon: My Lords, in relation to the noble Lord's discourteous answer to my noble friend, is the Minister aware that the unemployment figure in 1978 when Labour left office was 1,278,000? That is less than half the cooked figures which the Government now produce?
Lord Trefgarne: My Lords, certainly in 1979— not 1978—when we came into office, unemployment was on a rising trend. The figure which the noble Lord has mentioned is perfectly correct. That was the case. Naturally, it took some time for the programmes we had to put into place then, and subsequently, to have an effect on that sharply rising trend. I want to be fair to noble Lords opposite. The sharply rising trend was not confined to the United Kingdom; it was just particularly bad here.
Lord Hailsham of Saint Marylebone: My Lords, would not the questions from the opposite side be slightly more impressive if the trade union movement and the Labour Party got their act together over the Ford factory in Dundee instead of losing the lot?
Lord Trefgarne: My Lords, as I am always accused of being unfair to noble Lords opposite, not only today but on previous occasions, I thought it better to leave that observation to be made from behind me or beside me.
Lord Mackie of Benshie: My Lords, the questions have taken a distinctly political turn. I should like to ask the noble Lord a completely unbiased question. He belongs to a government who believe in business methods. All good businesses have targets. Would he tell the House what the Government consider to be the figure of unemployment at which they are aiming? What is the desirable figure of unemployment in this country today?
Lord Trefgarne: My Lords, the desirable target which we seek to reach is one substantially below the present level.
Lord Glenamara: My Lords, as regards this euphoria about the fall in the unemployment figures which we welcome—that is the fall in the figures, not the euphoria—would the noble Lord not lose sight of the fact that in the North-East of England we still have up to 40 per cent. male unemployment?
Lord Trefgarne: My Lords, I am not sure whether that figure is exactly accurate. I agree that there are parts of the United Kingdom where unemployment is still far too high. That is what I said in the original Answer.
Lord Hatch of Lusby: My Lords, the noble Lord says that the figure for the long-term unemployed is falling. Is it not the case that the figure for long-term unemployment among those under 25 is rising steeply?
Lord Trefgarne: My Lords, I do not believe that that is the case. But it is a detail within the statistics that I shall check.

Rover Group
2.52 p.m.
Lord Bruce-Gardyne Lord Bruce-Gardyne asked Her Majesty's Government:
What progress they are making in negotiations with the European Commission in Brussels regarding the writing-off of debt in the Austin Rover balance sheet in the context of the bid by British Aerospace to acquire control of Austin Rover.
The Secretary of State for Trade and Industry (Lord Young of Graffham): My Lords, with the leave of the House I shall in a few minutes make a Statement to the House on the Rover Group privatisation and the bid by British Aerospace. In the circumstances my noble friend may feel that it would not be appropriate for me to attempt a reply to his Question in advance of my Statement. Noble Lords will of course have a full opportunity to ask me questions arising out of my Statement in the usual way. I hope very much that other noble Lords will also be content to defer further consideration of this matter until then.
Lord Bruce-Gardyne: My Lords, I am most grateful to my noble friend for that reply. I am sure noble Lords will look forward very much to the Statement which my noble friend is about to make.

TV-am: Contract Obligations
2.53 p.m.
Lord Graham of Edmonton Lord Graham of Edmonton asked Her Majesty's Government:
Whether TV-am is in breach of its contract and if so what steps they are taking to ensure that the Independent Broadcasting Authority fulfils its duties under the Broadcasting Act 1981 by taking appropriate measures against TV-am.
The Earl of Arran: My Lords, it is entirely for the Independent Broadcasting Authority to determine the way it discharges its responsibilities under the Broadcasting Act 1981.
Lord Graham of Edmonton: My Lords, is the Minister aware that when TV-am applied for and got the franchise, it promised that it would extend regional coverage, community input and consumer

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affairs? None of that has been delivered. Perhaps I may ask the Minister a simple question: if the premises upon which the franchise was obtained are false, surely the Government should demand of the IBA that it fulfil its obligations under the Broadcasting Act 1981?
The Earl of Arran: My Lords, under the Broadcasting Act 1981 the IBA is required to ensure that programmes broadcast by the authority maintain a high general standard, a proper balance and a wide range in their subject matter. If the authority should conclude that a particular contractor was not fulfilling his contract it would be open to the authority to take such steps as are necessary to secure compliance with the contract or to terminate the contract.
Baroness Phillips: My Lords, surely the Minister is not completely quoting the Act. The IBA specified that any concession that was given must include more British material than material bought in from other countries. Now TV-am is certainly contravening the Act. I hope the Minister will accept that it may be the responsibility of the Government to see that the Act is carried out completely.
The Earl of Arran: My Lords, of course I take the noble Baroness's point. But I must again repeat that it is ultimately the responsibility of the IBA to see that its contractors carry out its wishes as laid down in the contract.
Lord Graham of Edmonton: My Lords, if it is the view of the Government that the IBA is failing to fulfil those obligations—and the Government are entitled to a view—what are the Government intending to do about it? If what we hear is true and there is to be an inquiry into the state of the television industry, will the Minister make sure that among the matters examined are not only the obligations of employees but also the obligations of employers to carry out their legal statutory requirements?
The Earl of Arran: My Lords, one of the fundamental principles of our system of public service broadcasting is that the broadcasting authority should be free from government interference in its day-to-day affairs. I am sure noble Lords agree that it would be a sad day if this important principle were to be jeopardised.

Business
Lord Denham: My Lords, it may be for the convenience of the House if I announce that the Third Reading of the Copyright, Designs and Patents Bill will be adjourned at approximately 7.30 p.m. for approximately one hour and that during this adjournment the Housing Benefit (General) Amendment Regulations 1988, the Housing Benefit (Supply of Information) Regulations 1988, the Social Security (Payments on account, Overpayments and Recovery) Regulations 1988, the Income Support (General) Amendment Regulations 1988 and the Family Credit (General) Amendment Regulations 1988 will be taken.

Rover Group
2.56 p.m.
Lord Young of Graffham: My Lords, with the leave of the House I shall now make a Statement on the Rover Group plc.
I informed the House on 1st March that British Aerospace had declared a serious interest in acquiring the government shareholding in Rover Group and that negotiations were being put in hand. British Aerospace asked that the negotiations should be on an exclusive basis. We agreed to this provided that the further studies it wished to carry out on Rover Group and the negotiations between British Aerospace and the Government were concluded by the end of April.
I promised to return and report the outcome of these discussions to the House at the earliest opportunity. I can do this today because British Aerospace has completed its investigations satisfactorily earlier than anticipated. The negotiations have therefore been concluded and agreement reached. The rules of the Stock Exchange require that in these circumstances an announcement is made without delay.
Today we have entered into a conditional contract with British Aerospace for the sale of the Government's shareholding in Rover Group. Before entering into the contract with British Aerospace we considered a number of confidential expressions of interest but none amounted to a specific offer. The board of Rover Group believes that this is the best possible outcome for the group. British Aerospace is strongly committed to the further development and growth of Rover Group, working with the existing Rover Group management who have made so much progress in improving the performance of the businesses.
Honda told me that it welcomed the continuity of Rover Group's management team which would be assured by British Aerospace's ownership of the company. I therefore hope that the important operational partnership between Rover Group and Honda can continue to develop satisfactorily. Without constraining British Aerospace's day-to-day management of the business, we have agreed important conditions on the agreement. British Aerospace has undertaken not to relinquish control of either Austin Rover or Land Rover within five years. This undertaking is supported by legal arrangements designed to ensure that it is not to its financial advantage so to do.
I shall now turn to the main financial terms of the agreement. During the negotiations it has been impressed on me by the board of British Aerospace that Rover Group operates in a highly competitive industry and that, notwithstanding the recovery in 1987, its current and prospective levels of profitability are insufficient to meet the interest burden on the debt built up through many years of accumulated losses.
The Government have been equally concerned that the merger of these two major British manufacturing groups should only move forward on a firm financial footing. Since 1975 when the Government became the majority owner of British Leyland the banks have

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been content to advance large sums on the strength of the Government's involvement.
In order that the company is in a fit state to return to the private sector it is appropriate that we should deal with this accumulated indebtedness, which no company without similar backing could be expected to maintain. Of course we would have had to undertake this exercise whatever route had been adopted for Rover Group's privatisation. The Government have therefore agreed that they will make a cash injection of £800 million into Rover Group for this purpose.
Following agreement on these steps to strengthen the Rover Group balance sheet we have been able to conclude an agreement to sell the government shareholding in Rover Group for £150 million. We have also agreed with British Aerospace and Rover Group arrangements whereby £1·1 billion of Rover Group's trading tax losses will be effectively eliminated, leaving only £500 million of these losses to be claimed against Rover Group profits in the future.
British Aerospace has also agreed that other currently available tax relief within Rover Group will only be applicable within that group
I turn now to the elimination of the Varley-Marshall-Joseph parliamentary assurances relating to Rover Group's bank debts, trade creditors and other obligations. These currently total approximately £1·6 billion. While Rover Group has been in public ownership the Government have given assurances that the obligations of the group will be met. No new obligations incurred by the Rover Group after the date of completion will benefit from the assurances. Obligations incurred between now and the completion date will cease to benefit from the assurances on completion.
The negotiations with British Aerospace have concerned only the Government's shareholding in Rover Group. British Aerospace has said that following completion of its acquisition of the Government's shares, it will make separate proposals to Rover Group's minority shareholders in due course to acquire their shares.
British Aerospace has made clear that these proposals will be fair and reasonable and will be made after consultation with the Rover Group board and its advisers. The agreement is of course subject to the approval of the British Aerospace shareholders and the completion of the normal EC procedures. I also expect to receive the advice of the Director General of Fair Trading.
I should like to explain what progress there has been on the EC implications of these plans. On 14th March we notified to the EC Commission that we proposed to deal with the necessary restructuring of Rover Group's finances. I met Commissioner Sutherland on 23rd March to explain the Government's objectives and proposals. I had a further meeting with Commissioner Sutherland yesterday.
The Commission has met today and has decided to open a formal state aid procedure. I am confident that the Commission will expedite its investigation.
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The agreement should bring to a successful conclusion the privatisation initiative which began in earnest with the flotation of Jaguar in 1984. This process accelerated when Graham Day took office in May 1986. He has returned 18 Rover Group businesses to private ownership. These include the trucks and bus activities, Unipart, Istel and Jaguar Rover Australia, which are all trading profitably under their new owners.
In the hands of British Aerospace, Rover Group would have the best available chance of developing its independent role in the vehicle industry. We cannot afford to underestimate the contribution to the economy of the largest UK passenger vehicle producer with a turnover of £3 billion, exports of £1 billion, direct employment of 43,000 and indirect employment of two or three times that number in the component supply sector, as well as over 50,000 jobs in Rover Group's distribution networks.
This will strengthen Rover Group's ability to compete at home and abroad and thus benefit all those who work with and for it, as well as the economy as a whole. I commend it to the House.
My Lords, that concludes the Statement.
Lord Williams of Elvel: My Lords, the House will be grateful to the noble Lord for making this Statement. The British Aerospace shareholders will no doubt think that Christmas has come rather early this year. On our side we believe that this constitutes an abandonment of the Government's fiduciary duty to the taxpayer.
Rover has a net worth of £770 million, which is being sold for £150 million, but the Government are producing a cash injection of £800 million. In other words net assets of £770 million are being sold, or rather the Government are paying British Aerospace £650 million to take the group off their hands. In addition the Government are giving a tax holiday to Rover Group under British Aerospace ownership up to £500 million, because, as the noble Lord rightly said, those losses can be used to set off against tax in future profits of the Rover business.
There will be no tax revenue to the Government from the future Rover business under whatever ownership it may be until those accumulated tax losses have been worked off. Will the noble Lord answer the following questions? On what terms will the £800 million cash injection be made? Why could it not be made to the existing Rover Group without a sale to British Aerospace?
What assurances are there for the workforce? We hear that there are assurances to the management but what assurances are there to the workforce? What belief can we have after the large losses that according to the press British Aerospace is going to announce, or may indeed have announced, that this will be a group which has financial viability and that we shall not see the same repetition of collapse that we have seen under previous Conservative Governments such as the collapse of Rolls-Royce?
What happened to the Rover corporate plan? Just at the point when Mr. Day said that Rover Group was turning a corner, that it was making profits and that it had a bright future, it is sent to the knacker's yard. We believe that this is an act of desperation.

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The Government have no faith in Rover's future. We have and we wish that the Government would abort the deal straight away.
Baroness Seear: My Lords, we on these Benches also wish to thank the Secretary of State for making the Statement in the House this afternoon. We have also frequently been critical of the Government for selling the family silver. We are even more critical of them for giving away the family silver, even if on this occasion it is somewhat tarnished.
There can be no question but that this step will incur a very heavy loss indeed for the taxpayer, as the noble Lord, Lord Williams of Elvel, has already made clear. The Government believe in the free market. They tell us in this Statement in a rather curious paragraph that they have considered a number of "confidential expressions of interest". We should like to know more about those. I suppose we shall be told that they are confidential and that therefore we cannot know about them.
But was it really not possible at least to attempt to make a better deal than handing Rover over at such enormous loss to British Aerospace? If the Government believe in their own policies of getting the best possible deal that they can in any transaction, it seems extraordinary that this should have been confined to a deal with British Aerospace and that nobody else effectively has come in. Indeed nobody else was able to come in because British Aerospace made the condition, or rather was offered the condition, of a deal provided it settled at the end of April. That seems the most extraordinary way to do business if there is something to be sold.
So we are deeply concerned about this. We are also somewhat concerned about the outcome of the formal investigation that is going on with the EC. Surely this is a very heavy subsidy to industry? What will the EC be likely to say about that as regards its competition policy?
Lord Young of Graf ham: My Lords, I am grateful to the noble Lord, Lord Williams, although I confess that I found it rather difficult to follow him. He started by saying that Father Christmas had come to British Aerospace and concluded by saying that the deal would undermine its whole future. I believe that this is a well-balanced deal.
The noble Lord drew attention to what the net worth of the Rover Group may or may not be. I am sure that it is a matter of public record that over the past five years the performance of the Rover Group has been an aggregate loss of £1·1 billion. That is an unfortunate record and one which I have no doubt will be improved under new management. The results of last year were a vast improvement on the previous year. However, those results showed a considerable loss after interest and tax.
The noble Lord asked what assurances we will give to the workforce. The assurances which may be given by anyone to the workforce are precisely those which can be given to the management. They last for as long as the products produced are those which customers want. There are no assurances beyond that. Indeed, the whole sorry history of Rover from 1976 onwards is demonstrated by that.
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The noble Lord also asked what the terms of the grant of £800 million are. The terms are such as to ensure that we are not giving the Rover Group a £500 million tax holiday. We are asking it to extinguish some £1·1 billion of existing tax losses which it will not be claiming. In other words, the tax losses are being reduced from £1·6 million to £500 million. Due to the sorry past record, the losses were that heavy. By that one act, the taxpayer will be saved some £400 million in tax revenue in the future. It also ensures that should the company endeavour to dispose of any of the businesses over the first five years, the net proceeds of the sale will be repayable to the Government.
I am grateful to the noble Baroness, Lady Seear, for her comments. She says that the agreement is a heavy loss to the taxpayer. It is in fact doing no more than recognising the existing position. It is an unfortunate but perhaps happy accident of the past that the Varley Marshall undertakings were such that the banks carried on giving credit to the Rover Group, secure in the knowledge that ultimately the Government would meet the bill. What we are doing today is meeting that bill, which was incurred over the last few years. We are putting right the overdrafts which exist. We have to do that in order to put the firm back into the private sector. Perhaps that is not a heavy toll for the taxpayer. However, it was a toll which was incurred over past years.
The noble Baroness asked why we dealt with confidential expressions of interest. Can Members of your Lordships' House have forgotten that just two years ago there was an expression of interest by the Ford Motor Company and that six weeks later the Rover Group had lost over 2 per cent., of its market share in the United Kingdom, reducing its share of the market from 18 per cent. to 16 per cent.? It never recovered from that loss. Today its market share is 15.8 per cent. The lost annual sales were £250 million.
British Aerospace was the first company which said that it was anxious to acquire the Rover Group. In looking at the approaches that were made, I have to take into account the future of not only the 43,000 people working in the Rover Group but also the 51,000 people who work in the distributors' network. That was the reason that I told the House that we were going through a period of exclusivity. I also said—it was repeated by my noble and learned friend the Chancellor of the Duchy—that if anyone made an offer we would consider the offer before finally accepting the British Aerospace offer. No such offer ever came.
We are today starting the procedure in Brussels. It may well be that the agreement will have an effect on competiton policy. However, I believe that it is simply a recognition of reality, because the losses have long existed, as have the debts. In any event, they would have had to be paid off one day. I hope that as the months go by we shall negotiate successfully through the tortuous and difficult procedure involved. However, I should like to discuss that with Commissioner Sutherland. I hope one day to return to your Lordships' House and say that we have been successful.
Lord Williams of Elvel: My Lords, I have one question of fact. Will the noble Lord reply to my

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question as regards the terms under which the cash injection will be made? I understand that there will be a £1·1 billion write-off in accounting terms of tax losses. Will the cash injection be repayable in any form or will it be in the form of simple grant?
Lord Young of Graffham: My Lords, it is both. It is in the form of a simple grant by way of a security which is repayable only if businesses are disposed of during the period and/or tax losses over and above £500 million are claimed. If so, it is repayable to the extent of the benefit achieved by the company.
Lord Boyd-Carpenter: My Lords, my noble friend has given details of the number of jobs involved directly which will continue as a result of this operation. However, can he tell the House how many jobs in component manufacturers are also involved and will continue?
Lord Young of Graffham: My Lords, the estimates I have indicate that there are something between 90,000 and 120,000 jobs involved in the component supply industry for the Rover Group.
3.15 p.m.
Viscount Chandos: My Lords, I should like to thank the Secretary of State for the Statement and his subsequent amplification of it. In principle, I and my colleagues in the SDP repeat our earlier welcome to the proposed acquisition of the Rover Group by British Aerospace.
If a sale is to take place—and the Government have long made clear their intentions—then will the House not agree, as Bill Jordan of the engineering workers' union said on the day of the earlier announcement, that it would be difficult to imagine a more suitable purchaser? Does the Secretary of State agree that the suggestions by the press and financial analysts that there are no synergies or industrial logic in the deal missed the key point that the general commitment by British Aerospace to manufacturing excellence, technological innovation and research and development is what makes it the best placed purchaser of Rover, both to build on its recent success and to strengthen British manufacturing industry as a whole?
Is the Secretary of State not concerned, after the comments of other noble Lords and notwithstanding the desirability of the deal from the point of view of public interest, that British Aerospace has been offered too favourable an agreement to take on the undoubted risks of the acquisition? Has the noble Lord, with his advisers, studied the precedents in the United States, whereby the US Government, in consideration for the financial support—
Noble Lords: Reading!
Viscount Chandos:—given to the Chrysler Corporation, took warrants in shares of the company that ensured that in the event of the company's ultimate success, the Government stood to gain some benefit from that success? Does the noble Lord not think that a similar arrangement, which is also used in the United States when the federal authorities
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rescue failing banks, would have given the UK taxpayer some potential return from the investment over the past 13 years? In addition—
Noble Lords: No!
Viscount Chandos:—could this not have presented an opportunity to give a similar interest to the employees of Rover and a consequential incentive after a number of difficult and hard years to maintain a productive and tranquil atmosphere of industrial relations?
Lord Young of Graffham: My Lords, I am grateful to the noble Viscount for his support of the arrangement. I assure noble Lords that the policy of the Government has been to achieve the return of the Rover Group to the private sector. We have considered many ways in which that could be accomplished. It seems to us that this is the best way and that the reward of the Government will be the continuation of component suppliers and distributors, as well as a healthy future for Austin Rover Group as an independent British producer of quality cars.
Lord Bruce-Gardyne: My Lords, I should like to thank my noble friend for his Statement. However, we are conjoined in the parable about looking gift horses in the mouth. Is it not a fact that British Aerospace is currently losing a king's ransom on every component that it makes for the Airbus project? Is it not apparent that, even on these golden, give away terms, the needs of Austin Rover for capital injections in the future, coupled with the cost of British Aerospace's civil aircraft programme, will leave horrendous burdens on the balance sheet of that business?
Can my noble friend assure us that the commitment that British Aerospace should not be allowed for five years to pass on Rover to another perhaps better endowed purchaser such as Ford or General Motors will not be written in tablets of stone so that at least British Aerospace in due course may be able to make a handsome turn? Failing that, what is the likelihood of the European Commission finding that the deal which he has structured is not acceptable in terms of European competition policy?
Finally, failing all those, has he had a word with our right honourable friend the Secretary of State for Defence about the possible requirements of British Aerospace for very large and profitable defence orders in the future if Austin Rover is to be sustained in the style to which it has become accustomed?
Lord Young of Graffham: My Lords, I am grateful to my noble friend. When I left industry and came to this present life of mine I vowed that I would leave behind making judgments on commercial matters. I should like to remind the House that it was the board of British Aerospace which approached the Government first. It is the board of British Aerospace which has investigated the future of Rover. It is the board of British Aerospace which judged it prudent and sensible to proceed with this purchase. My noble friend must have his own opinions, but in this matter it is surely the commercial

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judgment of British Aerospace that is appropriate. I do not contemplate—nor I suspect does the board—that British Aerospace will run into difficulties in the future. If that were to happen the Government would listen to anyone at that time. If there were a better course and a better way of dealing with Rover, we would have considered it seriously.
Lord Peston: My Lords, will the noble Lord answer the question asked by my noble friend Lord Williams of Elvel? In previous privatisations, whether or not one agreed with them, the private sector ended up with the real assets of the business and the Exchequer ended up with some cash. In this one, as the noble Lord has described it, the private sector appears to me at least to end up with the business but the Exchequer is out of pocket to the tune of £650 million. That is exactly what the Minister has said. Will he confirm that that is the case?
Lord Young of Graffham: Yes, my Lords, I am happy to confirm that the Varley-Marshall assurances of some £1·6 billion will disappear, hopefully within a year; that the stream of losses from Rover which the taxpayer has patiently borne, amounting to £1·1 billion over the past five years, will cease to be a burden on the taxpayer; and that Rover will look forward to a good future. That is the case. It is true that the Government will inject £800 million to pay off the existing debts of the company, liabilities of government which exist today. The Government will receive some £150 million for the shareholding.
Lord Joseph: My Lords, is the Secretary of State aware that, considering the worst and the best that might have happened, his Statement at least gives a new chance to the management, the workforce, the suppliers and the dealers, without future explicit risk to the taxpayer? Will he say whether output of cars per man year has improved since nationalisation? Is there scope for further improvement and, among other possible results, for a larger share of the market?
Lord Young of Graffham: My Lords, I am grateful to my noble friend. Since 1979 output per man has doubled in the Rover Group. It is now up to European standards. Its objective is to beat European standards and to compete with the rest of the world. In looking at this proposed sale in the round, I hope that all noble Lords, particularly noble Lords opposite, will listen at least to the views expressed by the workforce, the distributors and all who work in Rover, and be cautious about the ways they judge the outcome of this deal.
Lord Mackie of Benshie: My Lords, the Government have agreed that they will make a cash injection of £800 million into the Rover Group to pay off the banks. On the next page of the Statement the noble Lord refers to the elimination of the Varley-Marshall assurances. He said:
"These currently total approximately £1·6 billion".
Does he hope that British Aerospace will be able to pay those off and thereby release the Government? Or will the Government remain liable for the £1·6 billion?
Lord Young of Graffham: My Lords, half or so of the £1·6 billion assurances will be paid off when the £800 million which the Government pay discharges the bank debts. The remainder will be paid off in the course of time as trade creditors and other obligations are paid. What will happen—probably after the end of the year—is that the Varley-Marshall-Joseph assurances will have been eliminated and will be part of the normal trading obligations of the Rover Group as a subsidiary of British Aerospace should this matter proceed.
Lord Harmar-Nicholls: My Lords, if my noble friend and the Government are satisfied that this is a good deal under all the circumstances for the company and for the workforce, will he give a complete assurance that he will not allow any interpretation by the European Commission to sink it?
Lord Young of Graffham: My Lords, the procedure started today. The matter will take some months and I very much hope that we shall reach agreement. It would be foolhardy to say what you anticipate doing on the very day you start.
Lord Glenamara: My Lords, perhaps I may ask the noble Lord about a rather different matter. Does he recollect that when Cable and Wireless was privatised legislation was required? That was a publicly owned company. In this case, apparently there is to be no legislation. And there was certainly no electoral mandate. Are the Government quite sure that they have the legal right to sell off the business without parliamentary approval?
Lord Young of Graffham: My Lords, Austin Rover was once British Leyland and is a public company. It is still a public company. There are some 60,000 to 80,000 outside shareholders. The last two elections gave us the basis of our mandate for this action.
Lord Stoddart of Swindon: My Lords, is there a net benefit or a net detriment to the British taxpayer overall? I do not believe the noble Lord has answered that question in terms in which I, at least, can understand. Perhaps he will do so. My other question relates to the European Commission. If, after it has made an investigation, the Commission decides that this deal is against the rules of competition, what will the Government do then? Will they drop this proposal? If it is declared illegal, will they pursue the proposal irrespective of its legality under European law?
Lord Young of Graffham: My Lords, at present the Varley-Marshall assurances total some £1·6 billion for a net cost of £650 million, which, as I said, is the £800 million that we shall be putting into the company less the £150 million that we shall accept as the proceeds of sale of the shares. We shall be extinguishing that £1·6 billion liability. That demonstrates the benefit to government.
As regards the noble Lord's second point, if I have had one principle in my life it is not worrying about hypothetical situations. Preparing for them, yes. Should that situation unfortunately arise, I will then come to your Lordships' House.
Lord Molloy: My Lords, can the noble Lord say in which of the two previous manifestoes this subject was referred to so that we can understand whether the Government have a mandate for what is proposed?
Lord Young of Graffham: My Lords, I hardly think that the process of privatisation was a closely guarded secret in our manifesto of 1979 or at the time of the two subsequent elections.

Copyright, Designs and Patents Bill [H.L.]
3.30 p.m.
Lord Denham: My Lords, I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Copyright, Designs and Patents Bill, is content to place her prerogative and interests so far as they are affected by the Bill at the disposal of Parliament for the purposes of the Bill.
Bill read a third time.
Clause 2 [Rights subsisting in copyright works]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 1:
Page 2, line 7, leave out subsection (2) and insert—
("(2) In relating to certain descriptions of copyright work the following rights conferred by Chapter IV (moral rights) subsist in favour of the author, director or commissioner of the work, whether or not he is the owner of the copyright—

(a) section 72 (right to be identified as author or director),

(b) section 75 (right to object to derogatory treatment of work), and

(c) section (Right to privacy of certain photographs and films) (right to privacy of certain photographs and films.").

The noble Lord said: My Lords, in moving Amendment No. 1, I shall also speak to Amendments Nos. 86, 87, 93, 94, 95, 98, 101, 105 and 206. The noble Lord, Lord Morton of Shuna, tabled an amendment to Clause 11 at Report stage which would have given the commissioner of a photograph or film taken or made for private purposes first ownership of copyright. As I explained then, the Government felt that the underlying sentiment of the amendment to protect the privacy of individuals was laudable but we remained of the view that the author should in general be first owner of copyright.
To avoid introducing new anomalies into the Bill we decided that the best way of providing a privacy measure was in the form of a moral right. As the amendment to Clause 2 shows, the right will be enjoyed by the commissioner of certain works. This amendment also foreshadows the changes that we are proposing to the integrity right, but this will be discussed later. This right, as the new clause after Clause 78 specifies, will be enjoyed by anyone commissioning the taking of a photograph or the making of a film for private and domestic purposes, and it means that the work may not subsequently be made public without the permission of the commissioner.
If we take the example of wedding photographs, the commissioned photographer will own the copyright. He will be able to make the required number of copies of the photographs but he will not be able to do certain acts or authorise anyone else to
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do them. Thus he may not issue copies to the public, exhibit them in the shop window or include them in a broadcast or cable programme without the commissioner's permission.
Subsection (3) of the new clause provides the exception to the privacy right, and like the other moral rights it will continue to subsist as long as copyright subsists in the work. Where the work is made in pursuance of a joint commission, each commissioner will enjoy the right independently of the others. The right will apply to the whole or any substantial part of a work and, like the other moral rights, the privacy right is not assignable but may pass on death in the same way. Amendment No. 206 to Schedule 1 provides that the right does not apply to photographs taken or films made before commencement.
As I explained to your Lordships' House at Report stage, there is a limit to the extent to which the law of copyright may be used to protect privacy. However, by providing this new form of moral right for those commissioning photographs and films for private events I believe that we have found an answer to the question of privacy. Those who commission photographs and films, especially those in the public eye, can be reassured that they will now have a remedy against those who would splash those very personal and private pictures across the tabloid press. I hope that these amendments meet the concerns expressed by your Lordships and especially by the noble Lord, Lord Morton of Shuna, at Report stage. I beg to move.
Lord Williams of Elvel: My Lords, we are grateful to the Government for their response to the amendment moved by my noble friend. I shall speak to the same group of amendments as did the noble Lord, Lord Beaverbrook. If I may say so, it seems to us that the response goes only half way. We were looking for a protection under the main copyright part of the Bill. In his amendment the noble Lord has offered us a protection under the moral rights section of the Bill.
There are disadvantages in the moral rights concept that we have pointed out on a number of occasions in Committee and at the Report stage of the Bill. The greatest disadvantage seems to be the necessity for the holder of moral right having to assert that right as opposed to having it automatically without any assertion. In the case which was referred to by the noble Lord and which we are discussing under Amendment No 1, it seems to us weaker to put this assurance—the new clause suggested by Amendment No. 86—into the moral rights section of the Bill than into the copyright section of the Bill, as we first wished.
I should like to make two small points on the government amendments. In Amendment No. 1 one comes across the expression "derogatory treatment", which seems to replace the expression "unjustified modification" which appears in Clause 75. I am not and do not pretend to be a lawyer. I do not understand quite why the Government have sought to change the words "unjustified modification", which seem to us to be perfectly comprehensible, to the expression "derogatory treatment", which has a slightly different connotation. "Treatment"

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presumably covers modification but the word "unjustified" does not necessarily mean derogatory. I should be grateful if the noble Lord when he comes to reply would explain the Government's reasoning and tell us why they have used that new expression which at least one of my noble and learned friends on the Front Bench was unable to explain to me when I showed it to him a few minutes ago.
My second small point concerns Amendment No. 86, which covers the new clause to which the noble Lord referred. In the new subsection (2)(a), which refers to:
"section 31 (incidental inclusion of work in an artistic work, film, broadcast or cable programme)",
I do not see any reference to inclusion incidentally of such a work in a work of compilation.
The Government responded to points that I raised in Committee about collage. There are other works of compilation which may well be included in artistic works—and the noble Lord may be able to assure me of that—but they may well be outside the definitions that he has used in Amendment No. 86 for subsection (2)(a) of the proposed new clause.
I do not wish to carp about government concessions. I believe that the Government have moved in the right direction. However, despite the fact that some of my noble friends do not agree with me on this matter, I still feel that the director of a film and the commissioner of a work have rights which should properly he expressed in an economic interest rather than in moral rights. Nevertheless, for the moment, pending the passage of the Bill in another place and subject to the clarifications which I requested from the noble Lord, we are happy not to challenge these amendments.
Lord Brain: My Lords, I should like to thank the Government for what is probably a very good compromise on this question of copyright ownership by the commissioner of a photograph. It gives the photographer the right to receive a financial benefit from owning the copyright but allows the person who commissioned the photograph the control over its other reproduction. I think that the balance is right and thank the Government for this series of amendments.
Lord Lloyd of Kilgerran: My Lords, perhaps I may express briefly my gratitude to the noble Lord for his explanation of Clause 1 together with Amendment No. 1 and for speaking to the other nine amendments. At this late stage of the Bill I shall confine myself to remarking that some progress has been made and considerable concessions have been made by the Government. I shall leave the matter there. It shows once again that a great deal of work has been done by the officials behind the Front Bench. We are very grateful for the work that they have done at very short notice in order to bring forward so many amendments for our consideration.
Lord Beaverbrook: My Lords, I am grateful to the noble Lord, Lord Lloyd of Kilgerran, for his observations. I should also like to draw to your Lordships' attention the very considerable amount of work that has been done by my officials since the last stage of the Bill and indeed throughout all its stages
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as it has gone through your Lordships' House. Perhaps I may say to the noble Lord, Lord Williams, that there is no need for the person enjoying the new moral right to assert it. The assertion relates only to the paternity right in Clause 72.
On the question raised by the noble Lord, Lord Williams, about the expression "derogatory treatment", this indeed replaces the expression "unjustified modification", and does so in order to accord more closely with the wording of the Berne Convention. I shall be in a position to explain this more fully in a later debate in our discussion today. Perhaps at that stage the noble Lord will be able to hear what I have to say.
Finally, the noble Lord, Lord Williams, asked me whether a work of compilation such as a collage would be included. So far as it is an artistic work, it already falls within subsection (2)(a) of the new clause. This will certainly include a collage. We are not aware of any relevant types of thing which are not artistic works that ought to fall within the exception in subsection (2). I hope that those answers are helpful to the noble Lord.
On Question, amendment agreed to.
Clause 3 [Literary, dramatic and musical works]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 2:
Page 2, line 22, leave out from ("otherwise") to end of line 23 and insert—
("(3) It is immaterial for the purposes of subsection (2) whether the work is recorded by or with the permission of the author; and where it is not recorded by the author, nothing in that subsection affects the question whether copyright subsists in the record as distinct from the work recorded.").
The noble Lord said: My Lords, as I indicated at Report stage the question of copyright in oral works and reporters' copyright has given us some difficulty. The noble Lords, Lord Williams and Lord Morton, tabled an amendment at Report which, as I acknowledged at the time, seemed to provide an answer. They were kind enough not to press their amendment at that stage to give us time to draft our own amendment. This is the result.
It is, I believe, common ground that the author of a speech is the speaker and not the person who writes it down or records it in some other way. The Bill as now drafted makes that plain. What we are now concerned with is the position of the person recording the speech, in particular a person who writes it down and so has no sound recording or film copyright which he can claim.
The only authority on the matter antedates the 1911 Act and ascribed copyright to a reporter. Whether the courts would still follow the precedent of Walter v. Lane is uncertain. There is a difference between a secretary taking dictation and a reporter making notes at a political meeting. The courts would almost certainly not confer copyright on the secretary, but might confer copyright on the reporter. It is impossible to draw a clear boundary in legislation.
The present wording in the Bill might be construed as closing the door on the possibility of a reporter's copyright. The noble Lords, Lord Williams and Lord Morton, made the sensible suggestion—now embodied in this amendment—that the answer is to

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leave the door ajar. The clause as amended would allow the possibility that the recorder may have a separate copyright, leaving it to the courts to decide in any given case whether he has expended sufficient skill and sufficient effort to merit copyright.
I believe that this is the best solution. I beg to move.
Lord Williams of Elvel: My Lords, I am grateful to the Minister. His recollection of events is absolutely accurate. We tabled an amendment to this effect and the noble Lord was kind enough to say that the Government found some merit in it. I am sure that the drafting of the government amendment is sharper than our own. We are very happy not to oppose this amendment.
On Question, amendment agreed to.
3.45 p.m.
Clause 4 [Artistic works]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 3:
Page 2, leave out lines 38 to 41 and insert—
(""photograph" means a recording of light or other radiation on any medium on which an image is produced or from which an image may by any means be produced, and which is not part of a film;").
The noble Lord said: My Lords, of all the definitions appearing in this Bill it is perhaps the definition of "photograph" that has given rise to the most difficulties. The new definition we introduced at Report stage was, by general consent, a distinct improvement on its predecessor but there were some who felt that it was still not quite right. The noble Lord, Lord Brain, who is so expert in these matters, was among those who still had misgivings and has written to me with this comments, for which I am most grateful.
We have looked at this again and offer this revised definition which I hope will satisfy the noble Lord, Lord Brain, and others in your Lordships' House. There is a grammatical weakness in the present definition in that the concluding words,
"which is not a graphic work, a part of a film or a reprographic copy"
could be read as qualifying the word "image" and not the words "recording on any medium", so as to appear to be a proposition about photographs of graphic works. This drafting problem, taken with the observations of the noble Lord, Lord Brain, about whether the use of an ordinary photographic enlarger was a reprographic process set us thinking about the wisdom of excluding graphic works and reprographic copies from the concept of photograph.
The duration of copyright in a photograph is now the same as for all other artistic works, and with the removal of the distinction that previously existed we can find no case in which it is necessary to decide whether a particular work is a photograph or a graphic work. Either they are treated in exactly the same way, for example, in Clause 58(2) or it is immaterial if the photograph is also a graphic work, for example, in Clause 17(4).
A similar analysis in respect of reprographic copying gives a similar result. In none of the contexts where there is a reference to reprographic copying does it make any difference whether or not the
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reprographic copy involves photography or the making of photographs.
On the other hand, the exclusion of reprographic copies from the definition can prove significant, and the noble Lord, Lord Brain, has provided examples where what is clearly a photograph could be taken out of the definition because it is a reprographic copy. It is rather odd to try to distinguish photography and reprography since the reprographic process is almost invariably a photographic one. The reason we attempted it was to ensure that a photocopy did not constitute a photograph and so have a copyright.
We now think that was misguided. It results in too much being excluded from the scope of the term "photograph". What should be excluded from copyright protection is unoriginal photographs, but that is already plain on the face of the Bill. Only original artistic works are given copyright protection under the terms of Clause 1(1)(a). A photocopy may be a photograph but does not constitute an original photograph. It does not need express provision to exclude it from the scope of the protection afforded by this Bill.
All this leaves us with a much simpler, technologically neutral definition. I believe that it meets the concerns that have been expressed at various stages in your Lordships' House. I beg to move.
Lord Brain: My Lords, I thank the Government for the very hard work that I know they have done. I believe that this definition is now right and I hope that it will be agreeable to your Lordships. I have left in an amendment about reprographic copying and photographs, but in view of what the Minister has said it is obvious that I shall not need to move it. I thank the noble Lord and other Members of the House who have co-operated in putting forward my arguments on this amendment that have not been as concise as they might.
Lord Kilbracken: My Lords, at an earlier stage I put down an amendment which sought to define a photographer. I did not take part in the debate on the amendment of the noble Lord which put in the new definition of photograph. However, I considered carefully his revised version today and again read the debate that took place on that occasion. I regret to say that I do not share the enthusiasm of the noble Lord, Lord Brain. In my opinion the version in the Bill at present is not acceptable, although, if anything, it is slightly more so than the new version proposed by the Minister.
I have four short points to make. First, on our understanding of "photograph", the definition seems quite suitable with regard to positive colour photography. Negative colour is almost never used commercially. However, when black and white photography is used, a negative is made and that presumably is the "recording of light … on any medium". From the negative a black and white print is produced and in the new version that is the image that is made from the recording of light. However, the definition of photograph refers to the recording of light and not to the image that is produced from it. Therefore it seems to me that an ordinary black and white photograph is not covered by the definition.

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Secondly, if I take a drawing, a diagram or a map and transmit it by fax (facsimile) to a recipient, that drawing is reproduced by a recording of light. I do not know the technicalities, but it is a recording of light and therefore would seem to be under the definition of "photograph", which I do not believe it is meant to be.
Thirdly, if a photograph is transmitted by radio—which is the way photographs are normally sent from foreign countries or other parts of this country to a newspaper editor's desk in Fleet Street—a different technique is used and no light is involved in such a transmission. It would therefore seem to me that the print which appears on the picture editor's desk and which has arrived by radio—which is what he is buying; not the photograph which is still in Calcutta or wherever it may be—has not been produced in the way defined.
Finally, I want to make this point once again, because more and more, as I mentioned at an earlier stage, photographs are obtained from a video tape. That is becoming increasingly commonly done, as with all the photographs of the Belfast riots lately where a still is taken from a video tape. As I read it, that is specifically included by the words "not a part of the film", and therefore such pictures are not technically photographs although they are certainly treated as such in the newspaper business.
My proposal to include a definition of "photographer" in the Bill was thought to be unnecessary because we all know what a photographer is, though it can be argued about. In the case of a photograph it seems to me that we all know what is meant by "photograph" in the ordinary way and there is no need for a definition. It is only when unusual techniques involving something close to photographs are used that we have to define it. That is how it should be done in this case.
Lord McGregor of Durris: My Lords, it would be helpful if the Minister could explain why the points that the noble Lord has just raised are not covered by the phrase "or other radiation"?
Lord Williams of Elvel: My Lords, we have had a great deal of difficulty with the definition of "photograph", as the noble Lord said in his introduction. Many of us are guided in this rather technical area by the noble Lord, Lord Brain, who has been kind enough to send me copies of correspondence he has had with the Government. I am also guided by my noble friend Lord Kilbracken. Therefore I have no particular points of substance.
I have one or two what I would call nit-picking points about the amendment. Do I understand that the amendment could cover a photograph which is not developed but is transmitted by computer? I think my noble friend raised the matter of transmittal of photographs and more and more photographs are transmitted by computer. Does the definition as proposed cover transparencies? Does the amendment as proposed cover stills from a film? Probably it does because it is part of a film, or possibly it does not because it is part of a video. I wonder whether the noble Lord can help us on that.
Lord Somers: My Lords, I am a little disturbed by one matter which my noble friend beside me has just told me. I asked him whether this provision would make it in order for a music teacher in a school to make photocopies of copyright music for teaching purposes. He tells me no, because it merely means that he is not making a photograph. But will the noble Lord make that clear?
Lord Beaverbrook: My Lords, I think it is probably as well that we do not have a fourth reading in your Lordships' House because no doubt we could extend matters so that it was as long as some earlier stages of the Bill. The short answer to the noble Lord, Lord Kilbracken, is that transmission of a drawing by the fax process may well be a photograph, but does that matter? As I have already said, it would not be original and would not enjoy copyright On the other hand, if a photograph is transmitted by radio the item received may not be a photograph, but that does not alter the character of what was sent, which will remain a photograph and will continue to be protected by copyright.
A black and white photograph is a copy made from a negative in which copyright subsists. Any copy of the black and white print will be an indirect copy of the copyright negative and so could be an infringement. Clause 16(3)(b) ensures that both direct copying from the negative and indirect copying from a print could constitute infringement.
The noble Lord, Lord Williams, made a point about photographs being taken from a video recording. The relevant point is that a photograph taken in this way is not an original work. It does not therefore merit its own copyright as a photograph. The act of taking the photograph may however infringe the copyright in the film if taken without authorisation. Continuing on with the noble Lord's point, the transmission of photographs of part of films will not alter the character of what is sent, which will thus continue to enjoy whatever copyright it is entitled to.
I did not quite understand the point that the noble Lord, Lord Somers, made, but I shall read what he has said in the Official Report to see whether there is anything to which I should like to respond in writing. I commend the amendment to the House.
Lord Kilbracken: My Lords, before the noble Lord sits down will he explain—
Lord Beaverbrook: Order, this is Third Reading.
Lord Kilbracken: Could the noble Lord explain, how a print—
Noble Lords: Order!
Lord Kilbracken: My Lords, before the noble Lord sits down, I am asking him how it is possible for a negative to be a copy of a print when by definition what is black in a negative is white in a print and vice versa?
A noble Lord: A reverse copy.
Lord Hailsham of Saint Marylebone: The shape is the same!
Lord Beaverbrook: My Lords, we cannot go on backwards and forward on these matters at this stage. We have thrashed out the definition of a "photograph" pretty thoroughly over the last three months. I think we have arrived at the best solution. I commend the amendment to the House.
On Question, amendment agreed to.
Clause 6 [Broadcasts]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 4:
Page 3, leave out lines 29 to 33 and insert—

("(a) the person responsible for the contents of the broadcast who makes the arrangements necessary for its transmission, and

(b) the person who transmits the broadcast, if he has responsibility to any extent for its contents.")

The noble Lord said: My Lords, with the leave of your Lordships I shall speak also to Amendments Nos. 6 and 128. At Report stage we promised to come back with amendments of our own to provide that in the case of a broadcast on independent television both the relevant programme contractor and the IBA would qualify as persons "making the broadcast" and therefore as first owners of copyright in it.
Amendment No. 4 fulfils that undertaking. Amendment No. 6 provides that both shall be joint authors of the broadcast. This is because there will be no separate parts of a broadcast attributable to only one of them. The distinctness of the roles of making the programme and of transmitting it are not relevant here. Amendment No. 128 is consequential.
The Independent Television Association and the IBA have told us that they are satisfied with this solution. I beg to move.
On Question, amendment agreed to.
Clause 7 [Cable programmes]:
Lord Mottistone Lord Mottistone moved Amendment No. 5:
Page 4, leave out lines 13 to 19.
The noble Lord said: My Lords, at the Committee stage in reply to Amendment No. 37 in the name of the noble Lord, Lord Lloyd of Kilgerran, my noble friend said that if he withdrew his amendment the Government would have a further look at the question and come back with a government amendment if that proved necessary. Obviously he has not thought it necessary, but I suggest to him that it is.
Subsection (2)(a) is currently drafted so as to include not only electronic mail but the creation of on-line databases. These are such as are created, for example, by many doctors not only interrogating an expert system from their own surgeries but also entering their own diagnostic information into the database for others to use or for the system to alter its own responses to questions. It is clear that in that case—and there are many others—the owners of the database have a valuable work which they would not wish to be copied by or distributed to unauthorised users. I therefore ask my noble friend to consider whether Clause 7(2)(a) is necessary. If it is necessary,
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will he consider amending it at a later stage of the Bill in order to take care of the kind of situation that I have raised? I beg to move.
4 p.m.
Lord Lloyd of Kilgerran: My Lords, I should like to thank the noble Lord, Lord Mottistone, for reminding me of an amendment that I had withdrawn. During my work over the past few days I had not noticed that the Government had decided to raise the matter and that I had withdrawn my amendment on that basis. I shall be interested to hear what the Minister has to say.
Lord Beaverbrook: My Lords, I believe that my noble friend Lord Mottistone does not really intend the complete omission of Clause 7(2)(a) from the Bill without any replacement. That would cause an ordinary telephone conference service to be a cable programme service, which is obviously not right. What my noble friend seeks is an indication of why the Government have done nothing about the matters which he mentions and what perhaps they intend to do about them in another place.
The noble Lord, Lord Lloyd of Kilgerran, moved an amendment as long ago as 30th November, on the very first day in Committee, to deal with what appeared to be a problem with electronic mailboxes. He withdrew that amendment upon my undertaking that we would have a further look at the question and come back with an amendment of our own if that proved to be necessary. We looked at the question and came to the conclusion that nothing was necessary, which is why there has been no amendment on the point in my name.
The reason for that conclusion is this. As most of your Lordships will know, an electronic mailbox system consists of a central collection of secure electronic data stores and peripheral terminals. A message can be sent to any of the central stores from any of the terminals, but the message can be sent from the store only to the terminal dedicated to that store. We accept that whether this falls within Clause 7(2)(a) or not is not entirely clear, but in our view this does not matter, because such a system does not seem to fall within the definition of cable programme service in Clause 7(1) at all.
The messages are not sent from the central store for reception at two or more places or for presentation to the public. This is so even when the same message is sent simultaneously to several stores for reception by a number of terminals. Each message sent from each store is distinct from, although identical to, the others, and is capable of reception at only one place.
I think that my noble friend also mentioned what are known as expert systems—electronic databases which both transmit information and receive it for adding to the database for future transmission. Here the question is much more difficult. It is related to the point made by the noble Lord, Lord Williams of Elvel, in our stand part debate on 30th November, about the reference in Clause 7(2)(a) to "an essential feature". His comment, reported in Hansard at col. 869, was:
"It is rare that you would have at the moment a cable service which is either entirely one, interactive, or entirely the other".

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My response was that I thought that it was better that we considered that further as it is a complicated field.
I must say that nothing has happened in the past four months to suggest that I was wrong in that last remark. We have considered it further, not only internally but also in consultation with industrial and commercial interests, and we think that we now know the answer. Unfortunately, we were not ready with an answer in time for Report, and because no one else raised the matter at that stage it was pushed to the back of the queue. I am afraid that this is something which must now be dealt with in another place.
We think that the position is this. An expert system may be used actively or passively. As long as it is used passively, it ought to be a cable programme service, because it is then indistinguishable from an orthodox cable service carrying feature films, or a dial-a-disc service on the telephone. However, when used actively, or interactively as it is usually called, it ought not to be a cable programme service, because the passage of information back and forth between two terminals is indistinguishable from a telephone conversation or a video link.
We think that Clause 7(1)(a) as it stands has the result that the whole of a service which can be used both actively and passively will be excluded from being a cable programme service, because it is an essential feature that there may be sent, from each place of reception, material for reception by the person providing the service or others. That is not right. We need to say, I think, that the exception is of the whole service if the interactive element is an essential feature of the whole service, but that where the interactive element is an essential feature of only part of the service the exception is of only that part. As I say, this a very complicated field, and although we think that we have now found our way to the gate we were not able to do so in time to put down an amendment in your Lordships' House.
I hope that in the light of that explanation my noble friend will feel able to withdraw his amendment.
Lord Mottistone: My Lords, I am grateful to my noble friend for going into such tremendous detail in respect of this complicated problem. I apologise for the fact that we did not notice the need to table an amendment at Report in order to take the matter a step further. To that extent it is our fault rather than his.
I am grateful to him for realising that something must be done and for undertaking to take the issue through to the passage of the Bill in another place. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 10 [Works of joint authorship]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 6:
Page 6, line 4, at end insert—
("(1A) A broadcast shall be treated as a work of joint authorship in any case where more than one person is to be taken as making the broadcast (see section 6(2)).").
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 12 [Duration of copyright in literary, dramatic, musical or artistic works]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 7:
Page 6, line 36, leave out ("and") and insert ("but").
The noble Lord said: My Lords, this is a purely drafting amendment. It is desirable to render the drafting of Clauses 12 and 13 consistent. I beg to move.
On Question, amendment agreed to.
Clause 17 [Infringement of copyright by copying]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 8:
Page 8, line 24, leave out ("in that context") and insert ("and copies").
The noble Lord said: My Lords, with the leave of the House I shall speak to Amendments Nos. 8, 34, 35 and 146. These amendments are purely drafting amendments and follow up an undertaking I gave to the noble Lord, Lord Lloyd of Kilgerran, that we would look at the drafting of Clause 51. It will be apparent from Amendment No. 34 that we have been able to express the substance of the clause in a much simpler and more concise way. This clause is the very important clause which serves to take most industrial designs out of copyright.
As the amendment says, it is not to be an infringement of any copyright in a design document or model to make an article to the design or to copy such an article, except where the article itself is an artistic work or a typeface. I think that the effect of this will be perfectly plain, so I shall say only a few words about the references to a typeface and to the copying of articles.
Typefaces are included because they are the only things which are not artistic works under Clause 4 but which are still to be protected by copyright. Although typefaces are themselves not artistic works, the design of a typeface will almost invariably be an artistic work because it will start life as a drawing. We have already been through this on more than one occasion. Typefaces, however, were not included in the clause as originally drafted because in our view a typeface could never be an article made to the design of a typeface.
The reason for this apparently perverse view is that the design of a typeface is not a design of an article—that is a three-dimensional object—but rather of a two-dimensional impression made by an article. Thus, in our view Clause 51 would not take typefaces out of copyright in any event. However, in anticipation of the question, "If this is the case why do you not say so?" and in order to make Clause 51 as clear as possible, we have said so.
The copying of articles referred to in Amendment No. 34 clearly needs to be a reference to any copying, whether this is done by making further articles, or by making a design drawing or other document, or a design model. Amendment No. 8 is intended to make absolutely sure that this is the case, and as a result the effect is that once the copyright link has been broken by the making of an article no further copies in any form which are taken from that article, or indeed from a copy of the article or a copy of a copy of the article, and so on indefinitely, will infringe copyright.

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It is because of this that we no longer need anything equivalent to paragraph (c) of the existing Clause 51(1).
Finally, I should perhaps just add that Amendments Nos. 35 and 146 merely take advantage of the simpler drafting to simplify the references to surface decoration. I should emphasise that the meaning and substance of Clause 51 have not changed. I hope your Lordships will agree that the drafting is much improved and clearer. I beg to move.
Lord Lloyd of Kilgerran: My Lords, I am grateful to the noble Lord for taking up an amendment which I tabled earlier in these proceedings. From Clause 17 onwards we enter into the rights of a copyright owner and acts which are restricted by copyright. That is a very technical field. I am grateful to the Minister. The drafting by his officials is a great improvement on the original drafting with which I was involved.
On Question, amendment agreed to.
Clause 18 [Infringement by issue of copies to the public]:
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran moved Amendment No. 9:
Page 8, line 43, at end insert ("or
(c) any holding or loan by a prescribed library or archive or information service of any work which has already been put into circulation by or on behalf of the copyright owner.")
The noble Lord said: My Lords, as I mentioned, we are now in an area of considerable difficulty. In Clause 18 we are dealing with infringement by issues of copies to the public. What is meant by issues of copies to the public is of great importance to the library system. I have been asked to put forward this amendment on behalf of the Library Association and many others associated with libraries.
I am advised that unless there is an amendment to Clause 18 on the lines I have put forward, serious damage to the work of libraries may arise. Therefore, I make no apology for spending a little time in explaining what this amendment is about. I understand that it has been discussed with officials and it may be that we shall have some helpful observations from the Minister.
Clause 18 deals with the references in this part of the Bill to the issue of public copies of a work. The issue relates to the act of first putting these copies into circulation. There follow two exceptions and I have proposed as a third,
"any holding of loan by a prescribed library or archive or information service of any work which has already been put into circulation by or on behalf of the copyright owner".
That must be an exception.
The purposes of the amendment are, first, to give positive protection from publisher control of library content with the withholding of licensing since the present Clause 18 gives only tacit protection; and, secondly, to provide a basis for any approach to the Copyright Tribunal about licence. It is the inception of the concept of licensing in conjunction with the rental right which makes this proposal essential.
I am advised that material could be kept out of libraries or away from certain research applications. That could seriously damage information services,
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education and research. I am sure that the amendment could be drafted more adequately. It is however, an attempt to give what is needed in the new situation which has arisen; namely, a positive statement to protect the basic functions of libraries. I am advised that without such a provision, sale to libraries and even the reference of some materials could be refused, and donations could not be accepted. Over a period, that would seriously damage the work of libraries. I beg to move.
Lord Donaldson of Kingsbridge: My Lords, the Marshalled List should read,
"any holding or loan".
not,
"any holding of loan",
should it not?
Lord Lloyd of Kilgerran: My Lords, I was reading from my original document. The noble Lord is quite right. The amendment should state,
"any holding or loan".
Lord Morton of Shuna: My Lords, I support the intention behind the amendment. It is obviously necessary that libraries should be able to have these documents. However, I question whether the amendment is wholly necessary and also whether paragraphs (a) and (b) are strictly necessary when the clause states:
"References in this Part to the issue to the public of copies of a work are … to the act of first putting those copies into circulation".
This amendment deals with the situation after that act. Therefore, I should have thought, reading it very strictly, it is unnecessary. However, I support the intention behind it.
4.15 p.m.
Lord Beaverbrook: My Lords, the amendment standing in the name of the noble Lord, Lord Lloyd, is I believe, based on a misunderstanding of the provisions of Clause 18. The intent of the amendment, as I see it, is to ensure that the copyright owner may not use copyright to control the normal activities of a library in holding or lending books, periodicals and other copyright material which have been put into public circulation.
Clause 18 does not give the copyright owner the power to control library activities in such a way. Only the copyright owner, or those acting with his consent, may first put copies into circulation but thereafter those copies may be circulated without the constraints of copyright, as paragraph (a) of subsection (2) makes clear. The only exception to this is those works covered by the new rental right set out in subsection (3). But the introduction of a rental right does not change the position with regard to free lending. I believe that that covers the noble Lord's point on licensing. Libraries, and indeed anyone else, are quite at liberty to hold copies of copyright material which have been issued to the public and lend them freely to others without any risk of copyright infringement.
Of course, it is possible for copyright owners, when putting copies into circulation, to impose contractual obligations on those to whom they sell the copies. For

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example, it has long been a standard condition attaching to the sale of a book that it is not re-sold, hired or lent except in its original binding. But that has nothing to do with copyright. If a copyright owner will only sell a copy to a library on the condition it is not lent out, the library must of course abide by that condition or purchase a copy already in circulation where there is no contractual obligation. An amendment along the lines proposed by the noble Lord, Lord Lloyd, would not alter the position. Contractual obligations placed on purchasers of copies of copyright works, whether they be libraries or not, are not questions of copyright law.
I hope the noble Lord can withdraw his amendment given my assurance that the Bill as drafted gives copyright owners no powers over the subsequent holding or lending of copies once they have been put into circulation.
Lord Lloyd of Kilgerran: My Lords, I am grateful to the noble Lord for that very full answer. I shall consult my advisers in relation to the matter to see if it should be pursued in another place.
Having regard to the observations of the noble Lord, Lord Morton of Shuna, about what is unnecessary, I should like to say this in relation to the Bill as a whole. Copyright is a very simple matter; in essence the theme is quite simple. The great difficulty is the application of it. There are so many and varied applications. In a Bill on copyright, one attempts to deal with every possible solution. I was brought up—and I was only reminded of it today—on a report by a committee over which the noble Lord, Lord Renton, sat in which he advised that Bills should be in more general terms and should not try to deal with every application as we have been attempting in this Bill. After that peroration, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Viscount Brentford Viscount Brentford moved Amendment No. 10:
Page 9, line 3, at end insert—
("(5) It is an act restricted by copyright for the owner of a sound recording or film which includes a musical work and any literary work associated with it to permit its hiring under subsection (3) without the licence of the owners of the copyright in those works."
The noble Viscount said: My Lords, in moving this amendment perhaps I may speak also to Amendment No. 33. At Report the Minister said that under the Government's proposal the rental right was to belong to the owners of rights in the sound recording or film and not to those whose works were embodied in the recording or film, and that that was to avoid putting on the retailer a burden of having to obtain authorisation from and make payments to more than one category of rights owners. These two amendments are intended to introduce a rental right exercisable by composers and their publishers in a way that does not impose any additional burden on the retailer.
My noble friend also indicated at Report his view that composers and others whose contributions were used should be able to negotiate a share of the new revenue when the arrangements for making the sound recording or film were made. I have already passed on to him a copy of the formal advice which had been given to my firm of solicitors; namely, that
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contract does not offer a solution because copyright owners of the recorded works cannot, by contract, demand to exercise a right which the statute does not give them. Therefore, I hope that the noble Lord will consider my amendments favourably as they offer a solution to the two problems which he posed and at the same time remove an injustice inherent in the present wording of the clause. I beg to move.
Lord Lloyd of Kilgerran: My Lords, I have some difficulty in following the submission of the noble Viscount. It seems to me that the proposed amendment, far from removing an injustice, creates injustices. Certainly it is not necessary.
The amendment makes record company activity an infringement of copyright as against the publisher. Again it is in my view unnecessary because the rights of the publishers to remuneration follow the existing mechanical royalties agreement and any others which might replace it.
Record companies and publishers of course have very different interests in this matter. Record companies are keen to protect their business in order to ensure that rental does not undermine the retail sale. On the other hand, publishers seek to gain commercial advantages from rental. What appears to be ignored by the amendment is that the sale by a record company to a rental business is no different from the sale to a retailer and will entitle the music publishers to a mechanical royalty in any event. Music publishers will also receive a royalty based upon the prices charged for the rental business. Therefore, it seems to me that it is unnecessary to provide a rental royalty for the publishers, as that would make the collection and negotiation system for rental unduly complicated. The publishers' interests will be adequately catered for within the forum of internal industry agreements.
Lord Beaverbrook: My Lords, I find myself in agreement with the noble Lord, Lord Lloyd of Kilgerran, and therefore I am sorry to have to disappoint my noble friend. As my noble friend explained, these amendments are concerned with the rental right which your Lordships will recall was introduced into the Bill on Report. This new right is only conferred by the Bill on the owners of copyright in sound recordings, films and computer programs and not other copyright owners. The intent of the amendments in the name of my noble friend is to extend some of the benefits of the new right to other copyright owners, specifically the owners of copyright in musical works and associated lyrics incorporated in sound recordings and films.
As I explained when moving the amendments to introduce the rental right, we deliberately restricted the class of copyright owners who would be entitled to the right. If someone wants to hire out a record or film he should not have to obtain the permission of, and make separate payments to, more than a single category of rights owners. We believe it would be cumbersome and bureaucratic for the person hiring out a video to need a licence from all the owners of the many copyright works included in the video, as well as from the owner of the copyright of the film.
It is true that composers and lyricists provide an essential ingredient to a sound recording or film and

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on that basis should be entitled to a share of the profit made from its exploitation. At present if a record company wants to record a particular piece of music it must negotiate with the composer for a licence. In negotiations over what is a reasonable fee for such a licence, both sides will take account of the value that the recording to be made will have in the market-place. If the only outlet is sale, only the potential sales market need be considered. But if under the provisions of the Bill exploitation through rental becomes significant, there seems no reason why the composer cannot negotiate for a slice of that cake as well.
My noble friend is concerned that without a specific right composers and other authors will have no power to extract contractual payment from the record and film producers. To that end he proposes a right which the composers and authors may exercise against them. At least I believe that is the intent. The amendment to Clause 18 speaks of a restricted act for the owner of a sound recording or film to hire it out, when I suspect that it is the owner of copyright in the sound recording or film that is intended.
I do not believe that we need these additional rights to safeguard the position of composers and authors. I am, however, prepared to consider whether we should introduce a provision requiring the tribunal when assessing the rental royalty to take account of payment made to the copyright owners of musical and literary works.
There is of course an analogous provision in Clause 124. The copyright owner in the musical or literary work in giving permission for his work to be recorded can reasonably expect a payment related to the benefit to the recording company through sale. If there is also a benefit through rental he can withhold his permission until he obtains a reasonable share of rental proceeds. The fact that he has no rental right is immaterial—he has no "sale right", if I can use that expression, but that causes no difficulties. An amendment along the lines I have indicated will remove any doubt that it is reasonable for music copyright owners to look for a share of the rental market in negotiations over licensing in the same way as they now do in respect of sales.
I hope with that explanation that my noble friend feels able to withdraw his amendments.
Viscount Brentford: My Lords, I am grateful to my noble friend for his agreement to look at one point.
I appreciate that he has not had long to consider the letter I wrote to him with formal advice but I am glad that further consideration will be given, and in the light of that I am happy to beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 24 [Secondary infringement: making, importing, possessing or dealing with article for making infringing copies]:
[Amendment No. 11 not moved.]
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran moved Amendment No. 12:
After Clause 24, insert the following new clause:
("Secondary infringement: making importing or dealing with apparatus or device for making infringing copies.
.Copyright in works of a particular description is infringed by a person who, without the licence of the copyright owner—

(a) makes,

(b) has in his custody or under his control,

(c) imports into the United Kingdom, or

(d) sells or lets for hire, or offers or exposes for sale or hire,

any apparatus or device which is specifically designed or adapted, or the publication of any information which is calculated, to enable or assist persons to circumvent any technical devices incorporated in apparatus for playing or showing and designed to prevent or impede the making of infringing copies of works of that description.").
The noble Lord said: My Lords, on Report I drew attention to the fact that a great deal of research had taken place into making,
"technical devices [to be] incorporated in apparatus for playing or showing and designed to prevent or impede the making of infringing copies of works of that description".
They are called anti-spoiler devices. This amendment is similar to the amendment I introduced on Report which intended to make it an offence and a breach of copyright to have in your possession, custody or control, to import into the United Kingdom or in any way deal with such devices.
The Minister said on 23rd February (reported in Hansard at col. 1140) after a long speech on the matter:
"If the noble Lords, Lord Willis and Lord Lloyd of Kilgerran, feel able to withdraw their amendments we will certainly give this question very serious consideration, with a view to returning with our own proposals to deal with anti-spoiler devices".
It may be entirely my fault but so far I have not been able to discover in the 150 or so amendments that have been tabled by the Government that they have returned to this important matter of dealing with anti-spoiler devices.
I fully realise, as I said earlier, how busy the noble Lord and his officials have been. I make no complaint but just draw this matter to the Minister's attention once again. I beg to move.
Lord Beaverbrook: My Lords, the noble Lord is correct that he has not found a government amendment similar to his own among those tabled in my name. As he said, he tabled an identical amendment on Report and at that time I indicated that we would give serious consideration to the question of a provision to deal with anti-spoiler devices. We are not yet in a position to bring forward our own proposals but I hope that we shall be able to produce something in another place.
We have looked at this proposal. It has not been left or put on the back-burner but, as with all these helpful ideas that have been suggested by your Lordships over the past few months, there are often some broader implications that need to be considered in depth. That can often take rather longer than expected.
I hope that, with my assurances that the matter has not been forgotten and that the Government are favourably inclined to the principle underlying the amendment, the noble Lord will feel able to withdraw his amendment.
Lord Lloyd of Kilgerran: My Lords, I thank the Minister and at this late stage in the Bill I do not propose to raise any constitutional questions about matters put forward in this House being dealt with here and not left to the other place. However, in the circumstances and with the assurances given I agree that the matter should be left to the other place, and I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
4.30 p.m.
Clause 25 [Secondary infringement: permitting use of premises for infringing performance]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 13:
Page 10, line 30, leave out subsection (1) and insert—
("(1) Where the copyright in a literary, dramatic or musical work is infringed by a performance at a place of public entertainment, any person who gave permission for that place to be used for the performance is also liable for the infringement unless when he gave permission he believed on reasonable grounds that the performance would not infringe copyright.")
The noble Lord said: My Lords, we greatly simplified the provisions of Clause 25 at Report stage. I believe that there was general agreement that we had it about right. However, there was some criticism of the drafting. In particular, the noble Lord, Lord Kilbracken, drew attention to what he felt was an incorrect use of tenses in the clause. I undertook to take the matter away and reconsider. In doing so, I also looked at Clause 26 and I have taken the opportunity of rendering it consistent with Clause 25. With that explanation, I beg to move Amendment No. 13.
On Question, amendment agreed to.
Clause 26 [Secondary infringement: provision of apparatus for infringing performance, &c.]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 14:
Page 10, line 44, leave out ("also infringe the copyright") and insert ("are also liable for the infringement").
The noble Lord said: My Lords, in moving Amendment No. 13, I omitted to say that I would also be speaking to Amendments Nos. 14 and 15. I beg to move Amendment No. 14.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 15:
Page 11, line 1, leave out subsections (2) to (4) and insert—
("(2) A person who supplied the apparatus, or any substantial part of it, is liable for the infringement if when he supplied the apparatus or part—

(a) he knew or had reason to believe that the apparatus was likely to be so used as to infringe copyright, or

(b) in the case of apparatus whose normal use involves a public performance, playing or showing, he did not believe on reasonable grounds that it would not be so used as to infringe copyright.

(3) An occupier of premises who gave permission for the apparatus to be brought onto the premises is liable for the infringement if when he gave permission he knew or had reason to believe that the apparatus was likely to be so used as to infringe copyright.
(4) A person who supplied a copy of a sound recording or film used to infringe copyright is liable for the infringement if when he supplied it he knew or had reason to believe that what he supplied, or a copy made directly or indirectly from it, was likely to be so used as to infringe copyright.").
On Question, amendment agreed to.
Clause 27 [Meaning of "infringing copy"]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 16:
Page 11, line 40, leave out subsection (6) and insert—
("(6) Where copies which would otherwise be infringing copies are made in accordance with—

(a) section 32,35 or 36, or an order under section 132, (permitted copying for certain educational purposes), or

(b) section 59 (copying of artistic work for purpose of advertising it for sale),

and are dealt with for purposes other than those for which they were made, section 23(b), (c) and (d) (secondary infringement) and section 100(1)(d) and (e) (offences) apply as in relation to infringing copies.").
The noble Lord said: My Lords, in moving Amendment No. 16 with leave I shall also speak to Amendment No. 41. The two amendments in this grouping are intended to meet the criticisms made by your Lordships when we introduced what is now Clause 59 into the Bill at Report stage. Your Lordships will recall that this clause was introduced to meet a potential difficulty facing auctioneers and art dealers who need to include a reproduction of a picture in their sales catalogues.
I think there was a general consensus that a problem existed and that that needed to be addressed. Concern was expressed that the exception was too widely drawn. In particular the noble Lords, Lord Williams and Lord Brain, made clear their misgivings and I promised to look into the points that they raised. Although the second amendment in the grouping, I should first like to refer to the amendment to Clause 59. That amendment has the effect of removing exhibitions from the ambit of the exception. As I told your Lordships' at Report stage on 23rd February—or more accurately in the early hours of 24th February—we had not received any request to provide an exception in respect of exhibitions but we felt that similar principles applied. However, the points raised by the noble Lord, Lord Brain, in particular, clearly showed that we had allowed our enthusiasm to get the better of us. The exception should be limited to sale, which is the only area where we have been informed of a difficulty. The removal of exhibitions from Clause 59 will mean that the exception will seldom, if ever, apply to posters, which were of particular concern to the noble Lord, Lord Williams.
The noble Lord, Lord Williams, also raised more fundamental questions about secondary dealings in catalogues which include reproductions of copyright artistic works. As I understood his argument, the exception as drafted was too wide because it allowed an art dealer to make copies of a work on the basis that they were to advertise a sale. In some circumstances copies made quite legitimately in this way could be circulated to the detriment of the artist or to the copyright owner without there being any redress.
We accept that the noble Lord, Lord Williams, has a point here. Leigitimate copies made under this exception should be treated in the same way as copies legitimately made under the various educational exceptions. Clause 27 already recognises that the sale of, or other dealing in, copies made for educational purposes under various exceptions in the Bill constitutes an abuse of the exceptions and provides

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that such legitimately made copies are to be regarded as infringing copies for the purposes of some of the secondary infringements and offences. To minimise abuse of the exception in Clause 59, similar provision is needed and that is what this amendment provides. I beg to move Amendment No. 16.
On Question, amendment agreed to.
Clause 29 [Research and private study]:
The Earl of Stockton The Earl of Stockton moved Amendment No. 17:
Page 12, line 20, leave out ("research or")
The noble Earl said: My Lords, I am aware that your Lordships agreed to the government's Amendment No. 74 at Report stage, and I am therefore probably out of order in moving Amendment No. 17. Perhaps I may also have leave to speak to Amendment No. 18. I can think of no other strategy for finding out the views of the Government on the voluntary licensing scheme that I submitted in fulfilling the undertaking that I gave my noble friend the Minister at Report stage.
Lord Lloyd of Kilgerran: My Lords, may I presume to congratulate the noble Earl on the strategy that he has employed? The substance of Amendment No. 18 appeals to me and I would have supported it if it were possible to do so in any way in accordance with our procedures.
Lord Williams of Elvel: My Lords, we have had a good deal of debate on this matter, as the noble Earl quite rightly pointed out. On our side we have looked at the suggestion that the noble Earl made at Report stage about a possible general licensing scheme. Our advisers find considerable difficulty with this kind of scheme. If the Government are minded to consider further what the noble Earl has to say I believe that we on our side would find difficulty in going along with it.
Lord Beaverbrook: My Lords, my noble friend Lord Stockton and the noble Lord, Lord Williams, have reminded us of the debate we had at Report stage on the question of copying for commercial research. I explained the reasons for the Government's change of view on the question but did offer to consider, without commitment, any further evidence that my noble friend could bring to bear on the question.
Following our debate, my noble friend sent a draft licence for photocopying in industry to my noble friend, the Secretary of State. Copies were also sent to others of your Lordships and other interested parties in industry and the library community. We are currently looking at these proposals and look forward to hearing the comments of others. As I indicated at Report stage, nothing said to date has convinced us that industry would not be unduly burdened by the introduction of licensing in respect of copying that is presently allowed. It is too soon to come to a final view as to whether these new proposals will remove our concerns. Our early view is that they represent a step in the right direction, but I would not wish to give my noble friend great cause
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for optimism. The early signs from the user side are far from favourable.
I do not propose to deal with the amendments in the name of my noble friend in any greater depth since he indicated to me privately that they were probing amendments to discover how far we have got with our consideration. I could not accept these particular amendments, for drafting reasons if not for any other. I trust that what I have said will satisfy my noble friend as to the state of play. Even if he finds the news discouraging perhaps he can withdraw these two amendments.
The Earl of Stockton: My Lords, I thank the noble Lord the Minister for his discouraging remarks; and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 18 not moved.]
Viscount Caldecote Viscount Caldecote moved Amendment No. 19:
After Clause 29, insert the following new clause:
("Abstracts of articles.
.—(1) If an abstract of an article is published, dealing with the abstract for the purpose of disseminating scientific or technical information does not infringe any copyright in the abstract or in the article or in any publication in which the abstract or the article appeared, provided that such dealing is done by or on behalf of an authorised person and is accompanied by a sufficient acknowledgement.
(2) For the purpose of this section "an authorised person" means such scientific or technical persons or bodies as may be designated by order made by statutory instrument by the Secretary of State upon application made to him.
(3) Applications made pursuant to subsection (2) of this section shall be made in such manner as the Secretary of State shall direct and shall be accompanied by such information as he may reasonably require.").
The noble Viscount said: My Lords, the purpose of Amendment No. 19 is to remove uncertainty remaining in the Bill about fair dealing in relation to the publishing of abstracts—the so-called secondary publishing. These are very short resumés of the contents of articles.
I remind your Lordships that the principal abstracting service in the United Kingdom is the Institution of Electrical Engineers which is a nonprofit making charity. It deals with abstracts in the fields of physics, electrical and electronic engineering and related subjects. There is a smaller service operated in the field of materials by the Institute of Metals. The service provided by the Institution of Electrical Engineers has been going on since the end of the last century. Now about 240,000 abstracts are made each year and they are produced by an expert team of approximately 150 people.
These abstracts are of great value to scientists and engineers. There have been no complaints from publishers or authors. Nowadays the authors normally write the abstracts themselves to ensure that the principal points are brought out. Both the publishers and the authors like the publicity coming from the abstracts. As the Bill now stands, the problem arises in that there is serious doubt whether this abstracting service can continue without the threat of civil legal proceedings. This can be avoided only by seeking myriads of licences internationally as well as in this country, which is clearly impracticable. In passing, I thank the Minister for moving an

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amendment on Report that removed any risk of criminal proceedings against those who publish abstracts.
There remains the problem of civil proceedings. In the debate in Committee I moved amendments to try to remove the problem. The noble and learned Lord, Lord Denning, agreed that there was a need to remove this uncertainty. The Government resisted further amendments moved on Report by my noble friend Lord Lucas of Chilworth on the grounds that publishers and authors must be further consulted about protecting their commercial rights and because of the difficulty of implementing the amendments proposed.
I fully recognise and accept the need to protect publishers' and authors' rights, but there is also a need to enable this very valuable service to continue in the public interest without the threat of legal proceedings. I believe that the amendment achieves both those objectives simply and effectively. I think that the Government are sympathetic to the problem and I hope that they will accept the amendment to tidy up the Bill in this respect. I beg to move.
Lord Williams of Elvel: My Lords, I think that we understand the purpose of the amendment, and we are sympathetic to that purpose. However, I wonder whether it may not be better covered and perhaps improved by inserting an expression such as "part of the work" in Clause 29. Clause 29 appears to allow fair dealing for the purposes of research or private study. I assume that the noble Viscount has in mind research or private study, not abstracts produced for purposes other than research or private study?
Viscount Caldecote: My Lords, there is a problem here. Abstracts are used by scientists and engineers working for employers to find out what has been done in the field in which they are working so as not to have to repeat the work in order to know where they can start. It may not be private study in that sense but for use in their work.
Lord Williams of Elvel: My Lords, I imagined that to be research or private study. Perhaps there is a definition with which I am unfamiliar that is not covered by the expression "research or private study". It is not that I am unsympathetic to this, but I am endeavouring to define the terms of the discussion. If what I say is true, the amendment may be unnecessary. On the other hand, if what I say is not true and the noble Viscount has purposes other than research or private study in mind that need to be included in the fair dealing exemption, then one must be sympathetic because that would be a genuine point.
Lord Lloyd of Kilgerran: My Lords, I support the amendment. Having had to deal with abstracts over more decades than I care to remember, I think that clarification is necessary.
I am not sure whether I understand the submission of the noble Lord, Lord Williams of Elvel. The amendment deals with a practical matter involved with abstracts disseminated for scientific or technical information other than mere research or mere private study. The purpose of a great many of these abstracts
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is to help people in industry at all stages to get on and develop and do their work. The amendment has my support.
Viscount Caldecote: My Lords, with the leave of the House—
4.45 p.m.
Lord Beaverbrook: My Lords, I remind my noble friend that he has spoken twice already. Perhaps he can cover any other point when he winds up the debate.
This is a further variation of amendments tabled by my noble friend Lord Caldecote both in Committee and on Report. It would allow authorised persons to republish scientific and technical abstracts first published in periodicals along with the articles they summarise. Authorisation would be carried out by the Secretary of State, and the intention would be that he would only designate responsible persons such as the Institute of Electrical Engineers, which presently operates an abstracting service of this kind. With due respect to the learned societies that provide such services, I am not attracted by the amendment. It would put authorised societies in the position of being able to republish, and charge for the use of, someone else's work without payment.
I think that a much more acceptable approach was taken in my noble friend's amendment on Report. On that approach, republication of abstracts would be allowed without payment only if licences were not available from the copyright owner under a licensing scheme. This has the merit of freeing abstracting services from the need to get individual consents from owners of rights in the large number of source periodicals which they cover. But it also allows the rights owners to get appropriate royalties by setting up licensing schemes if they wish. This seems to achieve the right balance, and the Government intend to bring an amendment forward to this effect in another place. I hope that my noble friend can withdraw his amendment in the light of my remarks.
Viscount Caldecote: My Lords, I am grateful to the Minister for what he has said. We thought that we were helping him by simplifying the problem as he was unable to accept the amendments that were moved at an earlier stage. With the Minister's assurance than an amendment will be moved in another place, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran moved Amendment No. 20:
After Clause 30, insert the following new clause:
("Public Interest
. Copyright is not infringed by anything done in the public interest to disclose a matter of grave public concern or the existence of crime, fraud, abuse of authority, neglect in the performance of official duty or other misconduct.")
The noble Lord said: My Lords, I have been asked to move the amendment by the BBC. It raises the question of how far the public interest can be used as a defence in copyright. With the leave of the House, with this amendment I shall speak also to Amendment No. 124.
There is always a problem as to what constitutes public interest. In order to try to clarify the position, the amendment refers to:
"the existence of crime, fraud, abuse of authority, neglect in the performance of official duty of other misconduct".
It makes clear in this way that copyright is not involved in such actions.
Amendment No. 124, which is to be moved by the Government, deals with the question of public interest as a defence in copyright matters in a somewhat different way. The Government said on Report that there was no need for a statutory provision because defence exists at common law. The Government have at least moved forward with the intention to introduce a clause into the Bill. Amendment No. 124 says,
"Nothing in this Part affects any rule of law preventing or restricting the enforcement of copyright, on grounds of public interest or otherwise".
To include the words "or otherwise" in any Bill always causes trouble and to include merely the words "public interest" is inclined to give trouble. I have heard judges say in open court why Parliament should have left it to them to decide what is in the public interest in broad terms dealing with ordinary commercial matters.
With great humility, I presume to suggest that both amendments are intended to deal with the same mischief and that this amendment is in more practical terms than Amendment No. 124.
Lord Williams of Elvel: My Lords, the House will be aware that we on these Benches at many stages of the Bill have insisted that a public interest defence should be included. Indeed, we were reproved by the noble and learned Lord, Lord Denning, for our insistence in Committee. The noble and learned Lord pointed out that the courts were perfectly able to deal with the situation and that therefore we as amateurs should stop intervening in such matters.
Lord Lloyd of Kilgerran: My Lords, as I recall he did not refer to me as an amateur.
Lord Williams of Elvel: My Lords, I am sure that no one would refer to the noble Lord as an amateur. However, we feel, with considerable strength, that there should be some general public interest defence enshrined in the statute. If I had known that the noble Lord, Lord Lloyd of Kilgerran, was to table the amendment—I think he did so only recently, this morning—I should perhaps have considered adding our names to it, because, as I have already said, we feel strongly about it. I support the noble Lord's argument about the Government's Amendment No. 124.
We should like to see Amendment No. 124 with the words "or otherwise" left out. In our view that omission would be tantamount to accepting the amendment which we put forward in Committee, making public interest a full defence against infringement of copyright. However, having said that, if the Government insist upon including those words, we shall support a reasoned definition of "public interest" as a second-best measure, if I may
632
put it that way, and accordingly support the noble Lord, Lord Lloyd of Kilgerran. It is a matter about which we felt strongly during the earlier stages of the Bill's proceedings and we still do. Indeed, my colleagues in another place will continue to feel strongly about the matter. I hope very much that the Government, having moved perhaps half an inch, or even several inches, may decide to move just a couple of inches further to meet what I think are legitimate concerns on these Benches.
Lord Beaverbrook: My Lords, with leave I shall also speak to Amendment No. 124, which is tabled in my name. There has been much pressure on us, both in this Chamber and outside, to include in the Bill an express exception from copyright on public interest grounds. I have already explained both in Committee and on Report why we think that it would not be right to attempt to codify the existing case law on the point, and I do not propose to repeat that now, save to say that the amendment in the name of the noble Lord, Lord Lloyd of Kilgerran, shows exactly why codification would be unwise. Who is to say whether the circumstances listed in his amendment will remain the only matters in respect of which the courts, were they to retain a free hand, would be willing to accept that a defence of public interest should be available? I think that the new clause proposed by the noble Lord would be a great mistake.
However, we are persuaded that something should be said, and this I now propose to do by way of Amendment No. 124. It acknowledges the continuing effect of case law without attempting to codify it, thus leaving the law on this matter where it always has been, in the hands of the courts. It is not limited to public interest, although that is singled out for special mention, because other reasons sometimes emerge for denying the enforcement of copyright. The decision of this House in its judicial capacity in BL v. Armstrong is a case in point. My amendment may not go as far as some noble Lords would wish, but it is as far as we think that we should go. I hope that it will in due course satisfy your Lordships.
Lord Harris of Greenwich: My Lords, I should like to ask the noble Lord before he concludes his remarks whether he will agree that, as has been put to him both by the Opposition Front Bench and by my noble friend, Amendment No. 20 covers very nearly all the major issues of disquiet which have been expressed in the House. Will he further agree—perhaps he will not—that the amendment which he has tabled still gives cause for serious disquiet as far as many of us in the House are concerned as to whether it really addresses the issues which have previously been put to him?
Lord Lloyd of Hampstead: My Lords, I should like to express some sympathy for the Minister on that point. I think that there is a danger—
Lord Mottistone: My Lords, is it in order for anyone to speak after the Minister at this stage of the proceedings? I think not under the new rules.
Lord Beaverbrook: My Lords, normally it is customary on Third Reading and also at Report stage for the Minister to have the last word. However, with the leave of the House, I think I can deal quickly with the point raised by the noble Lord, Lord Harris of Greenwich. I believe that the key words in what he said are "very nearly". Throughout the Bill's proceedings it has been a matter of coming to a compromise position, which is very often a fine line between two sets of different interests. I cannot recall whether the noble Lord, Lord Harris of Greenwich, was present during our deliberations in Committee when the noble and learned Lord, Lord Denning, told us that he felt that any mention of "public interest" was unnecessary because the courts were quite able to resolve the matter. On the other hand, the noble Lord, Lord Williams of Elvel, among others, felt that it was indeed necessary to insert such a clause.
The Government have moved to try to find a balance between conflicting interests not only in this matter but in many other parts of the Bill. I believe that we have reached the right point in this matter; inevitably it will not suit everyone and there will be differences of opinion even among Peers on the same side of the House. However, at this stage I feel that we have the balance right. I hope that what I have said goes some way towards satisfying the noble Lord, Lord Harris of Greenwich.
Lord Lloyd of Kilgerran: My Lords, not only should the Minister be satisfying the noble Lord, Lord Harris of Greenwich, but as regards Amendment No. 20 I also have to be satisfied as to what procedures I should take having regard to what he said.
During the Bill's proceedings I have paid great attention to this important matter. When I presented the amendment to the House I was very brief. I did not go into the law involved, which I am sure would have satisfied the noble and learned Lord, Lord Denning; namely, that unless there was a clear statutory provision included in the Bill there would be a difficulty here. My amendment is directed to try to elaborate what the term "public interest" means in the context of today. The Minister's answer was, "Well, this might all alter in years to come; it may be different things. There may be no abuse of authority in the future and no neglect in the performance of official duty or other misconduct". He was in fact saying that there were other matters of public concern which I had not included and that those which I had mentioned would not be satisfactory.
Therefore, unless I can obtain from the Minister some suggestion that the amendment which he has tabled, Amendment No. 124, might be modified so as not to be worded in quite such broad terms, especially in regard to the words "public interest" and also "or otherwise", I cannot withdraw my amendment. However, if he can give some assurance in that connection and in effect withdraw his amendment, with an undertaking that he will represent it in a somewhat different form, I shall be clearer about the view which I ought to take. At present I am not satisfied with what he has said. Therefore, in those circumstances, I think I ought to take the opinion of the House.
4.59 p.m.
On Question, Whether the said amendment (No. 20) shall be agreed to?
Their Lordships divided: Contents, 88; Not-Contents, 132.

DIVISION NO. 1

CONTENTS

Airedale, L.

Listowel, E.

Ardwick, L.

Llewelyn-Davies of Hastoe, B

Attlee, E.

Lloyd of Kilgerran, L.

Aylestone, L.

Longford, E.

Banks, L.

McGregor of Durris, L.

Basnett, L.

Mackie of Benshie, L.

Blease, L.

McNair, L.

Bonham-Carter, L.

Mais, L.

Brain, L.

Morton of Shuna, L.

Broadbridge, L.

Mulley, L.

Carmichael of Kelvingrove, L.

Murray of Epping Forest, L.

Carter, L.

Nicol, B. [Teller.]

Cledwyn of Penrhos, L.

Northfield, L.

Cocks of Hartcliffe, L.

Parry, L.

David, B.

Phillips, B.

Davies of Penrhys, L.

Pitt of Hampstead, L.

Dean of Beswick, L.

Ponsonby of Shulbrede, L.

Donaldson of Kingsbridge, L.

Prys-Davies, L.

Dormand of Easington, L.

Rathcreedan, L.

Elwyn-Jones, L.

Ritchie of Dundee, L.

Ewart-Biggs, B.

Rugby, L.

Ezra, L.

Russell, E.

Fitt, L.

Saltoun of Abernethy, Ly.

Foot, L.

Seear, B.

Galpern, L.

Shackleton, L.

Glenamara, L.

Shepherd, L.

Graham of Edmonton, L.

Stallard, L.

Grey, E.

Stedman, B.

Halsbury, E.

Stewart of Fulham, L.

Hampton, L.

Strabolgi, L.

Hanworth, V.

Taylor of Blackburn, L.

Harris of Greenwich, L. [Teller.]

Taylor of Gryfe, L.

Taylor of Mansfield, L.

Hatch of Lusby, L.

Tordoff, L.

Hooson, L.

Turner of Camden, B.

Hughes, L.

Underhill, L.

Hunt, L.

Wallace of Coslany, L.

Irving of Dartford, L.

Walston, L.

Jay, L.

Wells-Pestell, L.

Jeger, B.

Whaddon, L.

Jenkins of Hillhead, L.

Williams of Elvel, L.

Kilbracken, L.

Willis, L.

Kings Norton, L.

Winchilsea and Nottingham, E.

Kirkhill, L.

Leatherland, L.

Winstanley, L.

NOT-CONTENTS

Airey of Abingdon, B.

Cameron of Lochbroom, L

Alexander of Tunis, E.

Campbell of Alloway, L.

Arran, E.

Campbell of Croy, L.

Auckland, L.

Carnegy of Lour, B.

Bauer, L.

Carnock, L.

Beaverbrook, L.

Carr of Hadley, L.

Belhaven and Stenton, L.

Coleraine, L.

Beloff, L.

Colnbrook, L.

Belstead, L.

Colwyn, L.

Bessborough, E,

Cork and Orrery, E.

Birdwood, L.

Cottesloe, L.

Blake, L.

Cox, B.

Blatch, B.

Craigavon, V.

Blyth, L.

Cranbrook, E.

Boyd-Carpenter, L.

Crickhowell, L.

Brabazon of Tara, L.

Cullen of Ashbourne, L.

Brentford, V.

Davidson, V. [Teller.]

Brougham and Vaux, L.

Denham, L. [Teller.]

Broxbourne, L.

Dilhorne, V.

Bruce-Gardyne, L.

Dundee, E.

Butterworth, L.

Eccles, V.

Caithness, E.

Ellenborough, L.

Caldecote, V.

Elles, B.

635

Faithfull, B.

Nelson, E.

Ferrers, E.

Newall, L.

Fortescue, E.

Norfolk, D.

Fraser of Kilmorack, L.

Orkney, E.

Gainford, L.

Orr-Ewing, L.

Gardner of Parkes, B.

Oxfuird, V.

Gisborough, L.

Pender, L.

Grantchester, L.

Pennock, L.

Hailsham of Saint Marylebone, L.

Penrhyn, L.

Peyton of Yeovil, L.

Hardinge of Penshurst, L.

Platt of Writtle, B.

Harrowby, E.

Porritt, L.

Harvington, L.

Renton, L.

Havers, L.

Renwick, L.

Hayter, L.

Rodney, L.

Hesketh, L.

Romney, E.

Hives, L.

St. Aldwyn, E.

Holderness, L.

Sempill, Ly.

Hooper, B.

Sharples, B.

Hylton-Foster, B.

Skelmersdale, L.

Joseph, L.

Somerset, D.

Kaberry of Adel, L.

Stockton, E.

Kimberley, E.

Stodart of Leaston, L.

Kinloss, Ly.

Strathcarron, L.

Kitchener, E.

Strathspey, L.

Lane-Fox, B.

Sudeley, L.

Lauderdale, E.

Swansea, L.

Lawrence, L.

Terrington, L.

Layton, L.

Teviot, L.

Lloyd of Hampstead, L.

Thomas of Gwydir, L.

Long, V.

Thorneycroft, L.

Lucas of Chilworth, L.

Thurlow, L.

McFadzean, L.

Trafford, L.

Mackay of Clashfern, L.

Trefgarne, L.

Macleod of Borve, B.

Trumpington, B.

Malmesbury, E.

Ullswater, V.

Margadale, L.

Vaux of Harrowden, L.

Merrivale, L.

Ward of Witley, V.

Mersey, V.

Westbury, L.

Milverton, L.

Whitelaw, V.

Monk Bretton, L.

Wise, L.

Montgomery of Alamein, V.

Young, B.

Mottistone, L.

Zouche of Haryngworth, L

Munster, E.

Resolved in the negative, and amendment disagreed to accordingly.
5.8 p.m.
Clause 38 [Copying by librarians: articles in periodicals]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 21:
Page 15, line 19, leave out ("thereby").
The noble Lord said: My Lords, for the convenience of the House I shall speak also to Amendments Nos. 24, 27 and 28. These are purely drafting amendments which have the merit of reducing the overall length of the Bill by four words. I am sure that the removal of unnecessary words is always to be welcomed. I beg to move.
On Question, amendment agreed to.
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran moved Amendment No. 22:
Page 15, line 31, at end insert—
("(3) Prescribed libraries may also copy as follows—

(a) in order to build special information files including extracts or abstracts of works")

(b) libraries of educational establishments may make one copy of an article in a periodical for loan.").

The noble Lord said: My Lords, I have been advised in this matter by the Library Association. Clause 38 deals with copying by librarians of articles
636
in periodicals. The purpose of my amendment is to give further powers to prescribed libraries so that,
"Prescribed libraries may also copy as follows—

(a) in order to build special information files including extracts or abstracts of works")

(b) libraries of educational establishments may make one copy of an article in a periodical for loan".

The Bill at present contains no provision for a prescribed library—and I emphasise that I am dealing with prescribed libraries—to copy for its own purposes except in Clause 42, covering archival preservation. The kind of copying in the first part of my amendment, that is to say copying:
"to build special information files including extracts or abstracts of works",
is essential for all libraries as part of the information service. Indeed, in some contexts it can itself have archival intent, such as photocopies instead of clippings as part of a local history collection. In respect of making copies for information file purposes—assuming of course no publication without permission in advance—a library's authority has long needed clarification.
In respect of the second part of my amendment which deals with libraries of educational establishments being able to make one copy of an article in a periodical for loan, I am advised that this is an essential corollary to Clause 42 of the Bill. The purpose is to preserve originals of selected articles against damage and loss during peak demand by students requiring loan access. I am advised, that it is not customary for academic libraries to lend originals of periodicals. The amendment is confined to academic libraries, confined to single copies for loan and confined to periodicals. I beg to move.
The Earl of Stockton: My Lords, I am concerned about the second part of the amendment of the noble Lord, Lord Lloyd of Kilgerran. If a library is to make one copy which then goes out into circulation and is subsequently destroyed, is the library then permitted to make one more copy which goes out into circulation, disappears or is destroyed and one more copy after that? I feel that this is the thin end of what could be quite a large wedge. Perhaps I may ask my noble friend whether he has had any further thoughts on that.
Lord Beaverbrook: My Lords, if I may say so, this amendment was tabled very late and relates, at least in part, to matters which have not previously been debated during the long and arduous passage of this Bill through your Lordships' House. In these circumstances it may not greatly surprise the noble Lord, Lord Lloyd of Kilgerran, to learn that I do not approach these amendments with great sympathy.
Clauses 38 to 43 provide a regime for copying in libraries which meets the needs of students and the operational requirements of libraries and archives, while safeguarding the interests of copyright owners. Clauses 38 and 39 will enable the student to obtain copies. Clause 41 allows libraries to make copies for supply to other libraries. The new exception in Clause 42 goes most, if not all the way to meeting the perceived need expressed in paragraph (b) of the amendment. It will allow libraries to preserve material they hold so that copies, rather than

637
originals, may be made for general day-to-day use in the library. Clause 43 provides for copying of unpublished works.
As for educational establishments, the various provisions in Clauses 32 to 36 provide further exceptions to copyright, all aimed at assisting the education process; and there are the provisions about licence schemes in Clauses 128 to 132. Photocopying is done under licence in schools in England and Wales and I understand that a pilot scheme has been set up for universities. It seems to me that there is very little copying which students and educationists might reasonably wish to do which cannot be done, either under licence or under the terms of the various exceptions that I have mentioned.
What we have to guard against is the notion that the operation of libraries or education is a cause which justifies overriding copyright owners' legitimate interests in all cases and at all times. I believe the package in the Bill has shifted the balance from the position in the 1956 Act towards educational interests and has made some small but useful improvements for libraries. I do not think we should go further. I hope that the noble Lord will be able to withdraw his amendment.
Lord Lloyd of Kilgerran: My Lords, I am very grateful to the noble Lord for what he said about the context of the amendment. I was sorry that he should have prefaced his remarks by mentioning the lateness of the tabling of the amendment. I apologise for being late in setting it down and causing his officials some difficulty. However I am tempted to refer to the Government's technological difficulties in getting copies of the Bill filed and their difficulties in finding out what amendments they had to put down, having regard to the undertakings which they had given in previous debates. In addition, when they had put forward all these amendments they found that there were at least 15 to 20 which had to be substituted for them. My advisers—and I shall refer to this later, if so tempted—have found it very difficult to get the necessary papers and people together to give advice.
However, having listened to the advice and comments of the noble Lord on this amendment I shall ask my advisers whether they will be proceeding with it at a later stage. In those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave withdrawn.
Clause 39 [Copying by librarians: parts of published works]:
5.15 p.m.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 23:
Page 15, line 33, leave out ("a copy of part of a published edition") and insert ("from a published edition a copy of part").
The noble Lord said: My Lords, Clause 39 as presently drafted could be construed as allowing the copying of a whole work provided it only formed part of a published edition containing other works as well. The amendment will remove this possible interpretation and ensure that only parts of works can be copied under the exception contained in
638
Clause 39. That is the position under the 1956 Act. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 24:
Page 15, line 35, leave out ("thereby").
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 25:
Page 16, line I, leave out subsection (3).
The noble Lord said: My Lords, the noble Lord, Lord Williams of Elvel, moved an identical amendment in Committee on 8th December. In doing so he described it as a probing amendment, but said that he felt subsection (3) put too heavy an onus on the librarian. I undertook to consider that point and come back with a firm view at a later stage. As I said in Committee, Clause 39(3) restates the provisions of the 1956 Act which have not come in for great criticism. I do not think that we can necessarily infer that this is because the provision causes no difficulties. It would seem that at least some librarians have only become aware of this provision of the 1956 Act as a result of seeing it restated in Clause 39. It may well be that there have been few difficulties because observance has not been all that it might have been.
Be that as it may, the question we have to ask ourselves is whether this is a reasonable burden to place on librarians. We have come to the conclusion that the answer is no. The extra protection subsection (3) gives copyright owners is small compared with the hurdle placed in the way of the librarian. As the noble Lord, Lord Williams, put it, it seems rather hard on the librarian if, every time he is required to make a copy, he has to ask himself, "Could I by reasonable inquiry ascertain the name and address of the person entitled to authorise the making of a copy?"
It must be remembered that Clause 39 only allows the librarian to make a single copy of a reasonable proportion of a work for research or private study purposes. Much of that copying could equally be carried out under the terms of the fair dealing exception in Clause 29. Thus in many cases, the consent of the copyright owner would not be needed.
It therefore seems undesirable to require librarians to attempt to track down the copyright owner to seek permission which in many cases is not needed. Furthermore, the majority of copying by librarians is of complete articles from periodicals and that is permitted under Clause 38. Even though Clause 38 is concerned with complete works, it is not felt necessary in that context to impose any requirement to seek out the copyright owner. It is difficult to see why the situation should be different in Clause 39 which is concerned only with parts of works. I believe that the provisions of subsection (2) of Clause 39, taken in conjunction with Clauses 37 and 40, provide sufficient safeguard for copyright owners so that subsection (3) is an unnecessary and bureaucratic gloss. I beg to move.
The Earl of Stockton: My Lords, I am sorry to have to disagree with my noble friend in this case. I think that he should look again at the decision to drop the subsection. The publishing industry is greatly alarmed to see that the Government are proposing to delete it and thereby permit widespread copying of books by libraries.
Successive departmental inquiries by Gregory and Whitford have held that this concession to libraries is not justified. The present rule is that libraries may only copy parts of books if they are unable to obtain the name of the copyright owner to whom they should apply for permission. It is this precondition which the Government are now proposing to delete and so provide a general permission instead of a limited one.
The existing precondition is surely a reasonable and necessary one. If a person using a book wants to photocopy a small part for ease of retention or handling he may usually do so as fair dealing. To extend this by permitting libraries to make a copy as a substitute for use of the book is a different matter entirely and goes to the root of copyright—the right to make copies—and also to the viability of publishing the book.
There is also the danger that the new provision would open up libraries to becoming supply centres for computerised works which could be regarded as published editions, so destroying the possibility of a sensible investment in them. A single copy of a part of a book may not sound very much to your Lordships, but once permitted it expands rapidly and it is difficult or impossible to prevent abuse as evidence of repeated or regular copying is almost impossible to obtain.
The result is that libraries soon provide copies of substantial extracts for people wanting to use the books instead of purchasing the required number of copies. That is economical but perhaps not a fair reward for the owner of the copyright of the book or the originator. There is not even a need for such a development. The Copyright Licensing Agency is willing to grant licences to make copies of parts of books on reasonable terms, and as libraries anyway have to require a form to be completed and a payment to be made for the copying little or no extra administration is involved in charging a royalty for the copyrighter. I am very unhappy about this and I hope that the Minister will reconsider.
Lord Williams of Elvel: My Lords, I am afraid that I have to take a diametrically opposite view to that of the noble Earl, Lord Stockton, as I am sure he will understand. I do so if only to preserve my own consistency in the course of further debates on this Bill.
I believe that as the Bill has gone forward at its various stages we have got the position of the librarian a little clearer and more sensible. We started off in the Bill with a rather rigorous position for a librarian, which was that by acting in good faith he could still be caught. As we have gone forward and the Government have accepted the thrust of a number of amendments, the librarian no longer has the onus laid on him or her to ascertain various things or to make sure of various things before copies are made.
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I believe that the Government are correct in their current assessment of the situation. I support Amendment No. 25 and I very much hope that the noble Earl will not wish to seek the opinion of the House on this amendment because if he does we will support the Government.
Lord Beaverbrook: My Lords, I am grateful to the noble Lord, Lord Williams. I shall briefly reply to the point made by my noble friend Lord Stockton. I accept that publishers receive requests from librarians for consent to copy under the equivalent provisions of the 1956 Act. I understand that normally this consent is given without payment. This, if I may say so, appears to support my view that doing away with subsection (3) will not harm the publishing industry. Publishers will not be deprived of any revenue which they now receive, and they, as well as the libraries, will be relieved of the administrative burden of dealing with such requests. For that reason and for the reasons that I stated earlier I commend Amendment No. 25 to the House.
On Question, amendment agreed to.
Clause 40 [Restriction on production of multiple copies of the same material]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 26:
Page 16, line 8, leave out ("or a person acting on his behalf").
The noble Lord said: My Lords, this is a purely drafting amendment that we missed at an earlier stage. Your Lordships will see that Clause 37(6) renders the phrase,
"a person acting on his behalf"
in Clause 40 superfluous. I beg to move.
On Question, amendment agreed to.
Clause 41 [Copying by librarians: supply of copies to other libraries]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 27:
Page 16, line 23, leave out ("thereby").
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 42 [Copying by librarians or archivists: replacement copies of works]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 28:
Page 16, line 38, leave out ("thereby").
The noble Lord said: My Lords, I have already spoken to this amendment, I beg to move.
On Question, amendment agreed to.
Clause 46 [Royal Commissions and statutory inquiries]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 29:
Page 17, line 36, after second ("a") insert ("published").
The noble Lord said: My Lords, in moving Amendment No. 29, with leave I shall speak also to Amendment No. 30. The first amendment to Clause 46 will make the clause again consistent with the analogous provisions in Clause 45 which your Lordships may recall we amended on Report.
The second amendment in my name seeks to clarify the position of bodies such as the Office of Fair Trading and others which carry out investigations without being able to take evidence on oath. Obviously such bodies should not be obstructed by copyright considerations any more than the courts or a more obviously recognised statutory inquiry.
It is not altogether clear whether investigations of the type carried out by the OFT can be called an inquiry, but use of the word "investigation" removes all doubt. I should point out that investigative bodies like the Monopolies and Mergers Commission which can take evidence on oath already fall within Clause 45 because of the breadth of the definition of the expression "judicial proceedings" in Clause 165. So for them the result of the amendment would only be to clarify the position of their reports as provided for in Clause 46(3) rather than of their proceedings as well. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 30:
Page 18, line 1, after ("held") insert ("or investigation conducted").
The noble Lord said: My Lords, I have just spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 48 [Material communicated to the Crown in the course of public business]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 31:
Page 19, line 2, leave out from ("purpose,") to second ("the") in line 3 and insert ("which could reasonably have been anticipated by").
The noble Lord said: My Lords, with the leave of your Lordships I shall speak also to Amendment No. 32. We discussed Clause 48 on Report in the context of an amendment of my noble friend Lord Mottistone to delete the words "or any related purpose" from subsection (2). I explained on Report why the phrase could not be deleted. For example, material submitted to a departmental committee is communicated for the purpose of persuading the committee of some particular case but the committee should not be precluded from copying that material for inclusion in its report.
In circumstances such as those I have in mind, I believe it would normally be within the contemplation of the person writing to the committee that his work would be copied and perhaps included in the committee's report. Since we accept the criticism that the phrase complained of by my noble friend Lord Mottistone is potentially too wide, we are proposing that the Crown's freedom to use material communicated to it is confined to purposes which could reasonably have been anticipated by the copyright owner.
The Crown's freedom of action under this clause can be further limited by agreement with the copyright owner, a provision now given its own
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subsection, and the clause as originally drafted and as amended does not give the Crown freedom to breach any trust or confidence. Clause 158 sees to that. The amendment further limits what the Crown may do. I do not believe the Crown would have abused the provision as drafted but this amendment will limit the potential for abuse and, I hope, satisfy my noble friend Lord Mottistone. Although I do not believe the amendment will make much difference in practice I see merit in stating on the face of the statute that the Crown cannot deal unreasonably with other people's works. I beg to move.
Lord Mottistone: My Lords, I thank my noble friend very much for going some way towards what I was seeking to achieve. I do not think that he has gone quite as far as I was hoping, but it is certainly a move in the right direction and I thank him for it.
Lord Williams of Elvel: My Lords, I agree with the noble Lord, Lord Mottistone, that the Government have gone some way towards what he wished to achieve. I have the difficulty that when the Government move in certain circumstances, half-way they tend to create problems for themselves by adopting a half-way position. I feel that the Government may be creating a problem for themselves by including the words
"which could reasonably have been anticipated by".
I assume, in the pursuit of good English, that "anticipated" means "expected" in that context. I hope that at some stage the draftsman may be persuaded to use proper English. The word "anticipate" means something quite different.
Nevertheless, assuming that the words mean "which could reasonably have been expected", I wonder what the copyright owner could reasonably be deemed to expect. Perhaps the noble Lord will be able to clarify that point and tell the House the circumstances he has in mind which the amendment covers. The Crown can argue perfectly properly that for the purposes for which the work was communicated to it, it is not an infringement of copyright if it issues copies of the work to the public. That is quite clear. It is not entirely clear that the Crown can argue successfully that a copyright owner should have been able to expect that the Crown would have used it in such and such a way. I shall be grateful if the noble Lord can give some further explanation of exactly what he has in mind.
5.30 p.m.
Lord Beaverbrook: My Lords, I agree with the noble Lord, Lord Williams, when he says that a halfway house can sometimes be a difficult position. As I said earlier to the noble Lord, Lord Harris of Greenwich, the Government find themselves in the position of having to try to establish a fair compromise on a great number of issues in the Bill.
The intention of the amendment is to enable any person, body or company which submits evidence to a government body to be sure that the evidence or submission will not be unfairly used but will be used in connection with a purpose for which it was originally intended by the user. The example I used earlier is a case in point. A person providing material

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to a committee can reasonably anticipate that the material will be published. Where the evidence is provided to a government body or department, very often a report is likely to flow from the inquiry or from the department which is looking into some matter. Therefore, the Crown should not be limited in using the evidence in a report.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 32:
Page 19, line 9, at end insert—
("(5) This section has effect subject to any agreement to the contrary between the Crown and the copyright owner.").
The noble Lord said: My Lords, I have already spoken to Amendment No. 32. I beg to move.
On Question, amendment agreed to.
Clause 50 [Acts done under statutory authority]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 33:
Page 19, line 16, leave out subsection (1) and insert—
("(1) Where the doing of a particular act is specifically authorised by an Act of Parliament, whenever passed, then, unless the Act provides otherwise, the doing of that act does not infringe copyright.").
The noble Lord said: My Lords, with permission I shall also speak to Amendment No. 207. The amendments address a possible defect in Clause 50 which has been pointed out to us by the Music Copyright Reform Group. The exception in Clause 50 is intended to apply only when some particular act is authorised by an Act of Parliament. An example in Section 19 of the Companies Act 1985 which requires a company to provide a copy of its memorandum and articles of association to any member who requires it. The copyright in those documents will not necessarily belong to the company itself.
It has been pointed out that the exception as drafted could possibly be taken to exempt from copyright control some whole class of activity which is authorised by an Act of Parliament—for example, broadcasting by independent television authorised by the Broadcasting Acts. That is certainly not our intention. In so far as it is a real possibility, it should be prevented. The amendments are intended to put the matter beyond doubt, both in relation to Clause 50 and the corresponding exception in Schedule 2. I beg to move.
On Question, amendment agreed to.
Clause 51 [Design documents and models]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 34:
Page 19, line 23, leave out subsection (1) and insert—
("(1) It is not an infringement of any copyright in a design document or model recording or embodying a design for anything other than an artistic work of a typeface to make an article to the design or to copy an article made to the design.").
The noble Lord said: My Lords, I have already spoken to the amendment. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 35:
Page 19, line 37, leave out ("decoration applied to the surface of the article") and insert ("surface decoration").
The noble Lord said: My Lords, I have already spoken to the amendment. I beg to move.
On Question, amendment agreed to.
Lord Mottistone Lord Mottistone moved Amendment No. 36:
Page 19, line 38, after ("article") insert (", or those features of shape, configuration, pattern or ornament capable of registration in respect of an article pursuant to the Registered Designs Act 1949").
The noble Lord said: My Lords, the proposed amendment will have the effect of allowing copyright to subsist in aspects of design capable of registration under the Registered Designs Act 1949. As such, all the exceptions contained in that Act as to what can and cannot be protected will apply to copyright in industrial applied aesthetic designs. It has been said that design right is primarily intended for the protection of functional designs and that the Registered Designs Act is primarily intended for the protection of aesthetic designs. However, use of the Registered Designs Act as a means of protection requires industry to file design applications. That can be an expensive process requiring the use of skilled professional practitioners.
The Design Copyright Act 1968 was intended to relieve industry of the burden of applying for registered design when copyright would suit its needs as well. That situation has not changed. The proposed amendment permits dual protection by copyright and registered designs in industrial applied aesthetic designs. It does not give industry greater protection than that provided by the Registered Designs Act. However, it allows industry to opt for a lesser and cheaper protection where appropriate. The amendment is necessary because of the present working of subsection (3)(d) of Clause 195. I beg to move.
Lord Beaverbrook: My Lords, the amendment standing in the name of my noble friend is certainly not without merit. As he has indicated, an industrially applied aesthetic design may be registered under the Registered Designs Act. Under the present law it also enjoys the weaker protection of copyright even if it is not registered. Why, my noble friend asks, should we remove that weaker protection if the designer chooses not to register? He says that the problem with copyright protection for the design of articles concerns functional and not aesthetic designs and that Clause 51 should be limited in its effect to functional, non-aesthetic designs.
That view is not unfamiliar to us. Indeed, it is a view which we have constantly sought to take into account in the long gestation of the Bill. It is therefore with some reluctance that I say to my noble friend that we cannot accept the amendment. The principal difficulty is that it introduces into the law of copyright, which is a non-registrable right, a test which is appropriate only to a registrable right. The test is, to use the words set out in Clause 245 of the Bill, whether the design features in question are features which appeal to and are judged by the eye, not including features dictated solely by function. There is also the element of materiality, for which I am proposing a drafting improvement in Amendment No. 177.

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The test is fairly easily applied if an application is made for registration of a design. The design is scrutinised by the staff of the designs registry in the Patent Office. There is the opportunity for appeal to a court against an adverse decision and the opportunity is always there for those who think that a design should not have been registered to apply for cancellation or rectification of the registration. In other words, the world can always readily ascertain the status of a design under the Registered Designs Act.
The problem with my noble friend's amendment, however, is that the same test would have to be applied without the benefit of the provisions in the Registered Designs Act. Someone wishing to exploit the design of the shape or configuration of an article which has been on the market for a few years would have to ask himself whether the design would have been registrable had the designer bothered to apply, but without any help from the presence or absence of the design on the register or the possibility of applying to the registrar for cancellation of the registration if he thinks that it was wrongly obtained.
In some cases the answer will be obvious, but in other cases he will have to guess; and if he guesses wrong, he could be sued for damages; or, if his wrong guess was in the other direction, he would decide not to exploit something which he was in fact free to exploit. The only way in which he could be sure of his position—unless of course the owner of the copyright was prepared to concede that the design was not capable of protection under the Registered Designs Act —would be to sue the copyright owner for a declaration, a very heavy-handed and expensive way of sorting things out, and one which is in any event no use if the copyright owner cannot be found. We think that these difficulties outweigh the benefit of my noble friend's amendment.
It might be said that the question of registrability already has to be addressed under Section 10 of the Copyright Act 1956. This is true, but that is the very thing that is wrong with Section 10, the very defect inadvertently introduced by the Design Copyright Act 1968 which we are now seeking to put right. This is precisely why the very next clause in the Bill, Clause 52, which replaces Section 10, does not mention registrability.
Finally, there is a lesser but not insignificant objection to my noble friend's amendment. It would produce the result that if articles, the shape or configuration of which was aesthetic, were not put on the market so as to cause the period of 25 years in Clause 52 to start running, the design in question would remain protected for the full term of copyright of life plus 50 years. That is too long. Unless the article itself is an artistic work such as a sculpture, we think that the design of its shape or configuration should be kept out of the public domain for no longer than 25 years at the most. I should add that this is not a mere drafting defect in my noble friend's amendment; it is a flaw in the whole concept.
My noble friend said that the situation has not changed since the Design Copyright Act 1968. I am afraid that I disagree. Before that Act there was no protection for an unregistered registrable design. Under the Bill, all designs will at least get the
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protection of design right in Part III. The designer of aesthetic articles has a choice. He may register his design and get 25 years' protection; or he may chose to rely on the unregistered design right in Part III of this Bill and get between 10 and 15 years' protection. We think that this is fair. My noble friend's amendment goes too far, and I must resist it.
Lord Mottistone: My Lords, I am grateful to my noble friend for his careful comments on the amendment. He has given me and my advisers a great deal of food for thought. I would not be at all surprised if they come back at some stage in another place. What is important is that my noble friend and his advisers have taken great care over the matter. I am grateful to them for that. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 54 [Use of typeface in ordinary course of printing]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 37:
Page 20, line 39, leave out ("or import").
The noble Lord said: My Lords, in moving this amendment I shall speak also, with the leave of the House, to Amendment No. 38. An identical amendment to omit the words "or import" was moved by my noble friend Lord Rodney at the Report stage. Unfortunately, the amendment was tabled too late for us to give the proposal serious consideration at that stage and my noble friend kindly withdrew his amendment to give us the opportunity to look into the point.
As I explained at the Report stage, the philosophy underlying subsection (1) of Clause 54 is that the owner of copyright in the design of a typeface should have the exclusive right to control its reproduction and dealings in infringing copies, but should not be able to control the use of his typeface in normal printing processes. It seems right to allow a printer to continue to possess and use a typeface, even if it is an infringing copy he has innocently acquired. In such a case the copyright owner has a right of action against the dealer who sold the printer the infringing copy.
As the clause now stands, the printer can import an infringing copy for his own use and the copyright owner can take no action. He can act against an importer only if he imports for onward sale. It seems wrong that the copyright owner could find himself with no one to sue in respect of infringing copies. It may be fair that the printer should not be liable if someone else was responsible for introducing the infringing typeface into the United Kingdom, but not if he himself did so. We have concluded that my noble friend Lord Rodney was right in proposing the deletion of "import" from Clause 54(1)(b).
The second amendment in this grouping is a consequential amendment that we missed at Report stage. Your Lordships may recall that we added possession to the list of secondary infringements on Clause 24 and a corresponding amendment should have been made here, in Clause 54. We now propose to correct that oversight. I beg to move.
On Question, amendment agreed to.
5.45 p.m.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 38:
Page 21, line 7, after ("importing") insert (", possessing").
The noble Lord said: My Lords, I have just spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 39:
After Clause 55, insert the following new clause:
("Incidental copying in course of use of work in electronic form.
.—(1) This section applies to works whose use in electronic form ordinarily involves incidental copying of the whole or part of the work.
(2) Any such copying which a purchaser of a copy of the work is permitted to do without infringing copyright, by express or implied licence or by virtue of any rule of law, and in respect of which he incurs no further obligation as to payment or otherwise, may also be done without infringement of copyright by any person into whose hands that copy of the work subsequently comes.").
The noble Lord said: My Lords, in moving Amendment No. 39, with leave I shall speak also to Amendment No. 208.
These amendments arise out of an amendment to Clause 17 which was accepted by your Lordships on Report. That amendment, in the names of my noble friends Lord Mottistone and Lord Stockton, had the effect that incidental copying in the course of running a computer program, or viewing a work stored in a computer database, was no longer excluded from the restricted act of copying. This provided the necessary legal basis for copyright owners to specify and enforce conditions about the numbers of permitted users of such works. However, in accepting the amendment, I said that the Government would bring forward an amendment to ensure that anyone legitimately acquiring a copy of such a work from a previous user who had been given a free licence to use it could use it freely to the same extent.
These amendments give effect to my undertaking. They apply to any work whose use in electronic form ordinarily involves some incidental copying. Computer programs are the most obvious examples of works which are used in this way but it is quite easy to envisage other kinds of copyright work, such as music, being made available in electronic form and played back through a computer, where incidental copying takes place.
The purpose of the amendment is to ensure that when a copy of a work in this form is sold and the first purchaser is free to use it without any further obligation, such as the requirement to make further payments after a period of use, then anyone who later acquires that copy is free to use it to the same extent as the first purchaser. This is in my view a necessary safeguard since without such a provision rights owners would be able to prevent second-hand use of copies even though they had been willing to sell such copies unconditionally in the first instance. As with other exceptions to copyright, a corresponding exception is needed in Part II. This will be provided by new paragraph 10A in Schedule 2. I beg to move.
The Earl of Stockton: My Lords, I should like to take this opportunity to thank the noble Lord for taking away our amendment at an earlier stage and bringing it back in such an embellished and improved form.
Lord Mottistone: My Lords, I should also like to add my thanks to my noble friend.
On Question, amendment agreed to.
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran moved Amendment No. 40:
After Clause 55, insert the following new clause:
("Sound recording of spoken literary work.
. If a sound recording of a spoken literary work has been made without infringement of copyright it is not an infringement of copyright in the literary work to broadcast, copy or otherwise exploit such a sound recording.").
The noble Lord said: My Lords, this amendment is directed once again to a problem that arises with broadcasters and relates to the sound recording of spoken literary work. The amendment says:
"If a sound recording of a spoken literary work has been made without infringement of copyright it is not an infringement of copyright in the literary work to broadcast, copy or otherwise exploit such a sound recording".
The difficulty that broadcasters have had with the extended definition of literary work is that it introduces an unacceptable level of uncertainty into the re-use of recordings which they had made in good faith.
Whether or not a copyright subsists in any particular piece of spoken word material or whether the scope of an implied licence extends to a particular re-broadcast are nice questions and expensive ones with which lawyers can deal and to which it might be some time before decisions of the courts give definitive answers. The purpose of this amendment is simply to ensure that if the broadcaster has obtained any consents required in order to make the recording in the first place, he should be able thereafter to use the recording without fear of infringement. That seems to me to be a commonsense position which arises out of the change in the basis of copyright under this Bill as regards broadcasters.
In the case of pure extemporisation, no consent will be necessary because copyright in the literary work will not subsist until the recording is made; so making the recording of itself will not constitute infringement of copyright. However, broadcasters usually have no way of telling in advance whether a speaker will deliver a prepared text from memory or speak from notes. Therefore, a broadcaster might well prefer formally to obtain consent or to ensure that the speaker is aware that the recording is being made.
I understand that the subject of this amendment has been carefully and somewhat sympathetically dealt with by the noble Lord's officials. I beg to move.
Lord Beaverbrook: My Lords, the noble Lord, Lord Lloyd of Kilgerran, has raised again the issue of copyright in the spoken word and the fears of broadcasters that this copyright could be invoked by those interviewed on television or radio to prevent or restrict use of the recorded material.
Your Lordships will recall my saying at Report stage that if we could find a way of reconciling the concerns of broadcasters with the degree of protection which those whose spoken words are recorded for radio or television are entitled to, we would consider it. Since Report stage we have been

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considering the matter further with the broadcasting organisations and we have been persuaded that an exception to copyright in the spoken word would be justified in relation to recorded interviews. Our previous argument against this was that broadcasters' fears were exaggerated and that such an exception was not necessary. This was because recorded interviews would either not be "works", or would be covered by an implied licence to broadcast. We still think that this will generally be the case. But we accept that sometimes there will be an element of doubt and that this could place an unreasonable burden on broadcasters.
We therefore propose that when a spoken work is recorded and all necessary consents to make that recording are obtained (so that the recording itself does not infringe copyright), the broadcasting of that recording or its inclusion in a cable programme service will not infringe copyright. Only if the speaker indicates, before the recording is made, that it is not to be used for purposes of broadcasting or inclusion in a cable programme service will this new exception not apply.
This, we believe, is a reasonable compromise. Speakers who agree to be recorded for broadcasting will still be able to impose conditions as to use if they wish to do so, but the onus will be on them to make this clear. Broadcasters will not have to worry about copyright being invoked after the event to prevent broadcast of a recorded interview to which the speaker has—tacitly or otherwise—consented.
I should perhaps stress that our proposed exception is confined to copyright as such; it will not extend to moral rights. This means that while broadcasters will he free to broadcast interviews and other spoken works which have been recorded with consent, they will still be obliged to ascribe authorship if the right to be identified is duly asserted and must observe the author's right not to subject the work in any way to a treatment which prejudices his honour or reputation.
We have not had time to work out the details of our proposed exception or to study the noble Lord's amendment closely enough to judge if it would serve the purpose. I hope, however, in the light of my assurances that we shall come back in another place, that the noble Lord will be willing to withdraw this amendment.
Lord Lloyd of Kilgerran: My Lords, I thank the noble Lord for his remarks. On the basis of that assurance I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 59 [Advertisement of sale or exhibition of artistic work]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 41:
Page 22, line 19, leave out from ("advertising") to end of line 20 and insert ("the sale of the work").
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 62 [Hiring of sound recordings, films and computer programs]:
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran had given notice of his intention to move Amendment No. 42:
Page 22, line 32, leave out ("sound recording").
The noble Lord said: My Lords, Amendment No. 42 is grouped with Amendment No. 45. I shall be speaking later to Amendment No. 45 and in those circumstances I do not propose to move Amendment No. 42 at this stage.
[Amendment No. 42 not moved.]
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 43:
Page 23, line 7, at end insert—
("(5) Nothing in this section affects any liability under section 23 (secondary infringement) in respect of the hiring of infringing copies.").
The noble Lord said: My Lords, in moving this amendment I shall also speak to Amendment No. 204. Your Lordships will recall that Clause 62 is a new clause introduced at Report stage into the Bill as one of a group of amendments which, taken together, provide the new rental right. The substantive amendment was new subsection (3) in Clause 18 which makes the hiring of copies of sound recordings, films and computer programs a primary infringement.
Clause 23(b), which echoes the 1956 Act, already provided for secondary infringement in respect of hiring of infringing copies. We now have a primary infringement in respect of hiring copies, whether legitimate or not, and a secondary infringement of letting for hire of infringing copies.
Your Lordships may possibly recall that the relationship between primary and secondary infringement was a question addressed by your Lordships' House in its judicial capacity in the case of Infabrics v. Jaytex. In that case the primary infringement of "publication" was given a narrow construction in order to give the secondary infringement scope in which to operate. We do not want Clause 18(3) given a restricted scope in order to give Clause 23(b) some meaning.
This amendment will ensure that this does not happen. Although Clause 62 imposes a statutory licence in respect of the hiring of copies, this does not entitle people to hire out infringing copies on payment of reasonable royalty. That is still secondary infringement under the terms of Clause 23(b).
This is perhaps a convenient point to address the other consequential amendment following on from the introduction of the rental right. The new rental right introduced into the Bill at Report stage should not apply in respect of copies acquired before commencement for the purpose of hiring them out, even if those copies were only first released during the preceding 12 months. If a trader acquires goods in the legitimate expectation of being able to deal with them freely, he should not later find himself unable to do so, or able to do so only on the payment of an unexpected royalty.
This amendment to Schedule 1 ensures that the new rental right, in both its early exclusive phase and during the remainder of its term, does not bite on

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copies which have been legally acquired under a regime in which there is no restriction on rental. I beg to move.
On Question, amendment agreed to.
[Amendment No. 44 not moved.]
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran moved Amendment No. 45:
After Clause 62, insert the following new clause:
("Reference to Copyright Tribunal.
.—(1) After the end of the calendar year following that in which copies of a sound recording are first issued to the public in the United Kingdom reference may be made to the Copyright Tribunal in relation to a refusal by the copyright owner to permit the hiring of copies to the public or in relation to any terms and conditions including any royalty set by the copyright owner arising from the granting of a licence to hire any sound recording.
(2) Nothing in subsection (1) shall oblige the copyright owner to permit the hiring of a sound recording prior to the end of the calendar year following that in which copies of that sound recording are first issued to the public in the United Kingdom.
(3) In this section references to hiring include any arrangement under which a copy is made available for a consideration in money or money's worth on terms that it will or may be returned.")
The noble Lord said: My Lords, the noble Lord has referred to the new Clause 62 regarding the important matter of rental. My amendment would introduce a new clause after Clause 62 as a kind of corollary in order to avoid the many bureaucratic licensing systems which might arise under arrangements in Clause 62 as it stands. It is intended to conform as far as possible with the general policy of the Government; namely, where it is in the public interest to do so to allow businesses to develop if the market so dictates.
My amendment is intended to conform with that theme to allow rental businesses to develop if the market so dictates. Indeed, the key to my argument is that the issue of rental should be left more and more to market forces with a minimum of interference and a minimum of bureaucratic control. Therefore, in my submission, it would not be advisable to have a central licensing system as envisaged by Clause 62 since this would take a vital function out of the hands of private business, in particular the record companies.
The proposed rental provisions are a corollary to those proposed by the Government. First, the new Clause 62 that the Government introduced at Report stage establishes the right for any hirer to refer to the Copyright Tribunal any matter arising from a refusal by the record company to grant a licence to hire on unfair terms and conditions imposed by the licensee. The right to approach the tribunal with any matter under such licensing shall arise only after the initial period of one year following the year of issue—the Government's proposed year of exclusivity.
There is another point on which my amendment is intended to be helpful. It is envisaged that record companies shall make available certain repertoire for hire. Should the hirer be dissatisfied with the terms of the licence granted, or if there has been refusal of a licence, he may refer the dispute to the Copyright Tribunal for adjudication but only with regard to sound recordings that are out of the period of exclusivity—that is, one year after the year of issue.
I speak somewhat tentatively. I do not want to get involved in any general policy difficulties, because I have been talking so much about public interest. This illustrates the record industry's desire to accommodate the hiring business while retaining the right to make individual judgments as to terms and conditions and the right to protect to a degree the interests of record manufacturers and the record industry. There is a basic difference in principle between granting a right that is subject to some kind of overriding jurisdiction in circumstances where unfairness arises, and taking away the right altogether after a period of time by imposing a statutory licence. The record industry feels that by this amendment the interests of all parties concerned will be properly protected in the circumstances that I have indicated. I beg to move.
6 p.m.
Lord Jenkin of Roding: My Lords, I originally added my name to Amendment No. 49 that comes later. It is in the same form as the amendment to which I spoke on Report. Having now studied Amendment No. 45 that the noble Lord, Lord Lloyd of Kilgerran, has just moved, I should like my noble friend to appreciate that it represents an attempt to meet both the interests of the record companies and the Government's perfectly legitimate interests and concern on behalf of the consumer that records should be available for hire.
I understand the Government's anxiety, based perhaps on the American experience. If a rental right is given even for a limited period—it was indicated earlier that a five year rental right might have been appropriate—during that period compact discs would not be made available for rental. However, the fact remains that the clause as it now stands would not give the record companies the protection they reasonably require against what is illegal but unenforceable—home copying.
Popular records may well make a profit for the record companies in a comparatively short time. However, my concern is for records of a classical nature. It may well take much longer before those earn a return for the record company. It seems to me that some additional protection is required for the record company in the circumstances envisaged.
I mention again to the House that I am trustee of a musical trust that provides concert and sponsor recordings of music, mostly of the baroque period. There is no question that the records have a considerable following but lack the kind of mass appeal that can earn for the record companies a return in a short period. I have to impress upon my noble friend that the record companies, and those with whom they contract to make these records, are seriously concerned that the clause in the Bill as it stands, by imitating the Japanese rule, will deprive them of some very valuable protection. To that extent it will undermine the pre-eminent place that the British recording industry holds in the world industry. There is serious concern about this.
The amendment moved by the noble Lord, Lord Lloyd of Kilgerran, goes some way to recognise that concern. I hope that my noble friend will feel able to accept it—at least the intention, if not the present drafting.
Lord Beaverbrook: My Lords, this amendment seeks to give the owners of copyright in sound recordings a full exclusive right in respect of rental but during the period when the hiring out of film and computer programs is subject to statutory licence those who are refused licences to hire out sound recordings may apply to the Copyright Tribunal. It is not clear what is to happen then, since we are given no guidance as to what the tribunal is to consider, whether it can order that a licence be granted, or what factors it should consider before making such an order.
I must say that the record industry seems to want its cake and to eat it since the first year's exclusive right is to be preserved without tribunal jurisdiction. If it is accepted that an exclusive right is appropriate if supervised by the tribunal in the last 49 years of the term, I cannot see why it should not be similarly supervised in the first year.
I hope the noble Lord will not press the amendment because I shall have to resist it at this time. However, we shall give the amendment further consideration at a more leisurely pace after this Bill has left this House. However, I would not hold out great hopes that we shall accept its underlying thrust. On that basis I hope that the noble Lord will withdraw the amendment.
Lord Lloyd of Kilgerran: My Lords, I am tempted to reply at some length because I feel that the Minister has not been quite as fair to the industry as I had hoped, especially after the considerable support given to the amendment by the noble Lord, Lord Jenkin of Roding.
However, at this late stage of the Bill, and remembering that this is Third Reading, the industry is trying to show that it is prepared to rent in the fairest possible way and to bring in the tribunal to take whatever decisions are necessary and fair in the public interest. The noble Lord indicated that there might be some light at the end of this tunnel in another place. I therefore beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 64 [Works included in, film or sound-track in which copyright has expired]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 46:
Leave out Clause 64.
The noble Lord said: My Lords, with leave I shall also speak to Amendment No. 231. The noble Lord, Lord Hacking, presented an eloquent case at Report stage as to why Clause 64 should be left out of the Bill. I replied that we broadly accepted his arguments and would seriously consider accepting his amendment to that effect. I am happy to say that having looked at the matter further we accept that there is no good reason to retain this clause. Since none of your Lordships rose to question the noble Lord's amendment at Report stage I do not think that I need to go into the arguments again unless your Lordships wish me to do so.
Amendment No. 231, the amendment to Schedule 6, is consequential. I beg to move.
Lord Lloyd of Hampstead: My Lords, as one who put down an amendment at an earlier stage to omit what was in Clause 61, which was also supported by the noble Lord, Lord Hacking, I should like to say that unfortunately I was unable to be present when that amendment was due to be moved. I should like to express my satisfaction that the Minister has now recognised that the clause contained an anomaly which was repeated from the earlier 1956 Act. I heartily endorse his moving that the clause be omitted.
On Question, Amendment No. 46 agreed to.
Clause 64 negatived.
Clause 65 [Incidental recording for purposes of broadcast or cable programme]:
Viscount Brentford Viscount Brentford moved Amendment No. 47:
Page 23, line 34, leave out ("or authorise").
The noble Viscount said: My Lords, the intention behind this amendment is to tidy up the exemption for what are known as ephemeral recordings by making the wording accord with the Berne Convention. The clause as a whole gives a person who has been authorised by a copyright owner to broadcast his work or to include it in a cabled programme the right to record it for either of those purposes. It is a special case where the normal right of a copyright owner to control the recording of his work is overridden by statute. The Berne Convention, Article 11bis, permits this, but only if the recordings are made by the broadcasting organisation,
"by means of its own facilities and used for its own broadcast".
As the convention does not permit the broadcaster to have these recordings made by someone else, the words "or authorise' in line 34 should be omitted. I beg to move.
Lord Lloyd of Hampstead: My Lords, I should like to support the amendment. Again, I am sorry to say, with apologies to your Lordships, I was unable to be present when an amendment I had tabled at an earlier stage was reached. There is no need for me to repeat the reasons that were so clearly given by the noble Viscount, Lord Brentford. This seems to go beyond the wording of the Berne Convention for the reasons that the noble Viscount gave. I strongly support the proposal that these words "or authorised" be omitted from the Bill.
Lord Beaverbrook: My Lords, I have listened with interest to the argument advanced for restricting use of the so-called ephemeral exception to cases where the broadcaster makes the recordings himself in-house. The Government agree, and indeed the Berne Convention demands, that the exception should not be used to permit a recording to be made without copyright authorisation except where a particular broadcaster makes it himself for use in one of his own broadcasts, or sub-contracts it out, again with a particular broadcast in mind.
However, we do not think it is practicable or right under modern conditions to restrict use of the exception to the broadcaster himself; nor do we

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regard this as required by the spirit (or necessarily even the letter) of the Berne Convention. Present-day realities are that all sorts of bodies are involved in the preparation of a broadcast. In some cases the broadcaster's own facilities may be minimal and almost all production work may be contracted out. We think that the Berne Convention is concerned to prevent the speculative making of recordings by outsiders for offer to broadcasters. The ephemeral exception had to be updated to meet these realities, as we said in the White Paper, and the Bill does this.
The main provisions of the exception—that is, its 28-day term and the restriction to use in respect of authorised broadcasts—will remain unchanged. We believe that this strikes a fair balance between broadcasters, some of whom argue for a more generous exception, and copyright owners, some of whom would like to see the exception withdrawn altogether. I regret therefore that my noble friend's amendment is not acceptable to the Government.
Viscount Brentford: My Lords, I am slightly surprised by what my noble friend has said, in the light of my understanding of the Berne Convention. The question may be raised again in another place at a later stage, but in view of the present position I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
6.15 p.m.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 48:
After Clause 65, insert the following new clause:
("Recordings for purposes of supervision and control of broadcasts and cable programmes.
.—(1) Copyright is not infringed by—

(a) the making or use of recordings by the Independent Broadcasting Authority for the purposes mentioned in section 4(7) of the Broadcasting Act 1981 (maintenance of supervision and control over programmes and advertisements); or

(b) anything done under or in pursuance of provision included in a contract between a programme contractor and the Authority in accordance with section 21 of that Act.

(2) Copyright is not infringed by anything done under or in pursuance of

(a) a notice or direction given under section 16 of the Cable and Broadcasting Act 1984 (power of Cable Authority to require production of recordings); or

(b) a condition included in a licence by virtue of section 35 of that Act (duty of Authority to secure that recordings are available for certain purposes).").

The noble Lord said: My Lords, with permission I shall speak also to Amendments Nos. 210, 236, 237, 238, 242 and 243. These amendments are to meet concerns raised by the broadcasting industry and the Cable Authority that the Bill as drafted fails fully to protect broadcasters and providers of cable programme services in relation to the provision of copies of their transmissions for purposes of supervision and control. It is certainly our intention that where copies of programmes are required to be made and used for purposes of supervision and control, this may be done without infringing copyright.
Under the Bill as drafted it is intended that the needs of broadcasters and cable operators should be met by reliance on existing provisions in the
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Broadcasting Act 1981 and the Cable and Broadcasting Act 1984, as amended in minor respects by Schedule 7 to this Bill. It has been pointed out, however, that these provisions do not cover the making of copies by the ITV programme contractors, and do not give protection in respect of the normal practice of the cable industry, which is that the requirement on cable operators to make copies of programmes for purposes of supervision and control is imposed as a term of their licences rather than in exercise of specific statutory powers.
The approach we have adopted is to introduce new provisions into the body of the Bill. These provisions are based partly on the Broadcasting Act and the Cable and Broadcasting Act and are partly new. The necessary exceptions with regard to copyright are made by the new clause to follow Clause 65, and the parallel exceptions to rights in performances are made by the amendments to Schedule 2. The first two amendments to Schedule 7 correct a minor deficiency in Section 7 of the Broadcasting Act 1981, and remove from that section the exception which will now appear in subsection (1)(a) of the new clause. The third amendment to Schedule 7, coupled with the amendments to Schedule 8, repeals those provisions of the Cable and Broadcasting Act which are now replaced by subsection (2) of the new clause.
This set of amendments will, we believe, provide adequate protection from copyright infringement in relation to recordings made for the relevant purposes by the IBA, Cable Authority, and their contractors and licensees. We recognise that similar provisions will also be required for the BBC. This has presented us with a drafting problem which regrettably we have been unable to solve before the Bill leaves your Lordships' House. This arises because the BBC operates under Royal Charter, not under legislation, and the provisions under which it agrees to maintain programme standards are in the form of a resolution by the board of governors of the BBC, which is itself not formally linked to the Royal Charter. The relevant amendments regarding the BBC will therefore have to be tabled in another place. I beg to move.
Lord Lloyd of Kilgerran: My Lords, in view of certain observations I made earlier in the proceedings some months ago about the attitude of the Government towards the broadcasting system, I thank the noble Lord for his words of sympathy on the problems of broadcasting.
On Question, amendment agreed to.
Clause 67 [Free public showing or playing of broadcast or cable programmes]:
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran had given notice of his intention to move Amendment No. 49:
Page 24, line 21, at end insert ("(not being a sound recording or film made with a view to copies thereof being sold or let for hire, or played or shown in public)").
The noble Lord said: My Lords, in the circumstances I ought to explain that this amendment includes letting for hire, but having regard to what the Minister said in relation to my submissions and those of the noble Lord, Lord

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Jenkin of Roding, on Amendment No. 45, I have the permission of the noble Lord, Lord Jenkin, not to move the amendment.
[Amendment No. 49 not moved.]
Clause 72 [Right to be identified as author or director]:
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran moved Amendment No. 50:
Page 26, line 20, leave out from ("of") to ("a") in line 21.
The noble Lord said: My Lords, in moving Amendment No. 50 I should also like to speak to Amendments Nos. 51, 52, 53, 79, 80, 125 and 127.
Noble Lords: Hear, hear!
Lord Lloyd of Kilgerran: My Lords, I am much obliged. These amendments deal with the problems arising for broadcasters as a result of the change in the basic law of copyright. The first two amendments have the effect of removing the right of an author of a literary work to be identified when the work is performed in public, broadcast or included in a cable programme servicee. In the circumstances of broadcasting that appears to be eminently reasonable.
The third amendment removes the artist's right of indentification in cases where the visual image of an artistic work is broadcast or included in a cable programme service. I have dealt briefly with Amendments Nos. 50, 51 and 52.
Amendment No. 53 removed the artist's right of identification in relation to public performance of a film, including the visual image of an artist at work if the public performance is of a broadcast or cable programme which includes the film in question. The net outcome is that as regards broadcasting the right of paternity would be preserved for the authors of dramatic works and directors of films but it would be lost by the authors of literary and artistic works.
Broadly speaking, that would put broadcasters on the same footing as newspapers, periodicals and the publishers of encyclopaedias, dictionaries, yearbooks or other collected works of reference. The justification for doing so would be the same. In other words, it puts broadcasters in the same position in which journalists now find themselves.
Inter alia, as with newspapers and periodicals, the broadcasters rely on a multiplicity of free-lance contributions which are often assembled rapidly or united into a large collectivity which is a programme. It would be hopelessly impractical, irksome to the listener and viewer and of no real benefit to the author to have to identify each and every contribution. Those remarks deal with my first four amendments.
I should like to turn to Amendment No. 79 which has been tabled by the Government. According to the groupings I should at least refer to it. I have difficulty in understanding this amendment in the context of the amendments relating to broadcasting tabled in my name.
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My Amendment No. 80 relates to the way in which derogatory matters should be treated. The Government's amendment would remove the right to object to derogatory treatment of works made for the purpose of reporting current events, but it does not go far enough. That amendment relates to Clause 76. The broadcasters do not seek to be better treated than newspapers and periodicals or the publishers of encyclopaedias, yearbooks, dictionaries and other collective works of reference. They are seeking to be put in a similar position to that of newspapers. Broadcasters seek recognition of the fact that in terms of content their current affairs, talks, features and documentary programmes occupy identical ground to and appeal to the same interests as the daily and Sunday press and periodicals. For example, at one end of the spectrum is the Times Literary Supplement while at the other end there is Punch.
Amendments Nos. 125 and 127 have been tabled by the Government. They are brief and appear to be straightforward but in the short time available to me I have been unable to do them justice. I beg to move.
Lord Willis: My Lords, I am sorry to differ from my noble friend but I hope that the Government will resist these amendments. It is tremendously important for an author to have credits. He is often underpaid, especially at the beginning of his career, but being identified as the author of a particular work will make a great deal of difference to his future career. As I see it, these amendments nibble away at the moral rights already established in the Bill. I believe that they are totally unjustified and I hope that the Government will resist them.
Lord Beaverbrook: My Lords, I should like to speak to the group of amendments as listed by the noble Lord, Lord Lloyd of Kilgerran. However, I believe that he missed out Amendment No. 59, the first amendment on this subject tabled in my name.
Lord Lloyd of Kilgerran: My Lords, I am sorry, I referred to it but I did not understand what was meant in the context of my submission.
Lord Beaverbrook: My Lords, perhaps I shall be able to enlighten the noble Lord a little. This grouping of amendments deals with a number of proposals for further exceptions to moral rights. With the leave of your Lordships I should first like to speak to my own amendments to add a fourth subsection to both Clauses 74 and 76.
These are amendments which reflect a point raised by the noble Lord, Lord McGregor of Durris, at the Report stage about press agency services. We realise that time is very much of the essence with a wire service and the pressures are much the same as those applying to newspapers so far as moral rights are concerned. However, we felt that merely adding the words "press agency" to the newspaper exceptions would not be satisfactory because so much of the information provided by such agencies is for non-newspaper purposes —such as relaying the latest stock exchange prices to banks and financial institutions. We decided that a broad approach would be more appropriate so the rights are

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disapplied to any works made for the purpose of reporting current events.
This formula has the added advantage of meeting some of the fears expressed on Report by the noble Lord, Lord Lloyd of Kilgerran, about the effect of moral rights on broadcasters. I explained on Report that we felt that an exception to all works made for the purposes of broadcasting would be going too far. However the noble Lord, Lord Morton, suggested that the amendment be limited to news reporting and this idea appealed to us. It means that newspapers, radio and television will be treated alike when it comes to the reporting of current events.
In the light of the amendments of the noble Lord, Lord Lloyd of Kilgerran, it is apparent that this new exception does not go far enough to meet the concerns of the broadcasting organisations. The amendments to Clause 72 seek to disapply the paternity rights in respect of literary works, including the lyrics accompanying musical works, and the visual image of artistic works which are broadcast or included in a cable programme. Amendment No. 80 proposes an exception to the integrity right in respect of literary and artistic works when they are included in certain programmes.
The Government have already gone a long way towards meeting broadcasters' concerns. It is appropriate that all of the media should be exempt from moral rights in relation to news and current affairs broadcasting and this is what the amendments I have just spoken to provide. To go further than this would I fear dilute moral rights to such an extent that they would be worthless, and would introduce all kinds of anomalies, which of course we are trying to avoid. As I explained at the Report stage, the Government decided that the fast-moving nature of the newspaper world and the risk of injunctions made a special case for newspapers. Beyond the demands of current affairs reporting the Government have concluded that these pressures do not apply to broadcasters to the same degree. I must therefore resist these amendments.
The second aspect of my own amendments concerns composite, or as we have defined them "collective" works. As I explained in response to the amendment tabled by my noble friend Lord Stockton, the Government agreed with his proposal to include composite works in the exception made for newspapers, magazines and periodicals. The problem before us was finding the best way of defining such works. We are grateful for the various suggestions made to us as to the best definition for composite works. I do not pretend that these amendments are the only way of tackling this question, but I can assure your Lordships that a great deal of thought has gone into them and I believe we have a solution which is both concise and easily understood.
The exception will apply to collective works of reference including encyclopaedias, dictionaries and yearbooks which are works of joint authorship or works in which there are distinct contributions by different authors or in which works or parts of works of different authors are incorporated. The exception will apply to both the paternity and integrity right and the other amendments provide a definition in Clause 165 and an entry for the index in Clause 166.
6.30 p.m.
Lord Morton of Shuna: My Lords, I am very grateful to the Minister for taking up something which I suggested. I believe that this is the effective compromise which is necessary because news reporting must have some protection. It is my experience as a reader—and of course I have no other experience—that if a literary work which is not a piece of news reporting is printed in a newspaper, normally the author's name is printed. In broadcasting, I see no reason if that type of work is being written and produced in some way, that the author should not also be identified. Therefore, I believe that the compromise of the government amendment is to be preferred.
Lord Lloyd of Kilgerran: My Lords, I am grateful to the Minister. Perhaps I may try to understand the case that he has made based on my Amendment No. 50. I understand him to say that his Amendments Nos. 59, 79, 125 and 127 move a certain way, as I believe they do, towards the position of broadcasters and their problems. In those circumstances, he recommends that I withdraw all the amendments in my name; in other words, Amendments Nos. 50 to 53 and Amendment No. 80. As I said, I have not had the opportunity to study with any advisers the precise scope of the four amendments grouped with mine. However, in view of what the noble Lord has said, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 51 to 53 not moved.]
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 54:
Page 27, line 29, leave out from ("74") to end of line 30 and insert ("(exceptions to right)").
The noble Lord said: My Lords, in moving this amendment I should like to speak also to Amendments Nos. 55, 56 and 58. This group of amendments deals with two drafting points. Amendments Nos. 54, 55 and 58 reflect the different meaning of exceptions to, non-applicability of, and non-infringement of the paternity right.
Amendment No. 56 is a simple drafting point: it is not a typeface which is a work but the design of a typeface. We have already considered the significance of this point at some length during earlier stages of the Bill. I beg to move Amendment No. 54.
On Question, amendment agreed to.
Clause 74 [Cases in which right does not apply]:
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 55 and 56:
Page 28, line 23, leave out from ("director") to end of line and insert ("is subject to the following exceptions.").
Page 28, line 27, at beginning insert ("the design of").
On Question, amendments agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 57:
Page 28, line 28, at end insert—
("(2A) The right does not apply to anything done by or with the authority of the copyright owner where copyright in the work originally vested—

(a) in the author's employer by virtue of section 11(2) (works produced in course of employment), or

(b) in the director's employer by virtue of section 9(2)(a) (person to be treated as author of film).").

The noble Lord said: My Lords, during the Report stage I agreed in principle with the amendment of my noble friend Lord Stockton to disapply the paternity right to employees. As I explained then, considerable concern has been expressed by employers about having to identify authors of all works in the manner required by this clause and we felt that the paternity right should not apply to employed authors and film directors.
I was unable to accept my noble friend's amendment at Report because it did not cater for film directors. We have now done this in Amendment No. 54. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 58 and 59:
Page 28, line 29, leave out ("does not apply in relation to") and insert ("is not infringed by").
Page 28, line 41, leave out subsection (4) and insert—
("4) The right does not apply in relation to any work made for the purpose of reporting current events.
(4A) The right does not apply in relation to the publication in—

(a) a newspaper, magazine or similar periodical, or

(b) an encyclopaedia, dictionary, yearbook or other collective work of reference,

of a literary, dramatic, musical or artistic work made for the purposes of such publication or made available with the consent of the author for the purposes of such publication.").
On Question, amendments agreed to.
Clause 75 [Right not to suffer unjustified modification of work]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 60:
Page 29, line 8, leave out ("unjustified modification") and insert ("derogatory treatment").
The noble Lord said: My Lords, in moving Amendment No. 60, I shall speak also to Amendments Nos. 61 to 75, 77, 84, 85, 89, 90, 96, 100, 102, 106, 107 and 205.
A great deal of thought has been given to the wording of the integrity right in Clause 75. During the Report stage the noble Lord, Lord Lloyd of Kilgerran, proposed that we should drop the reasonableness test and adopt the exact wording of Article 6 bis of the Berne Convention. I agreed that the "reasonable in the circumstances" test should be left out because it went further than what is specified by Berne.
Having looked again at the wording of Article 6 bis it does seem wise to use it where possible. We have tried to fit the new expressions into the existing structure of the clause. Thus instead of an "unjustified modification" we will have "derogatory treatment" which is a distortion or mutilation of the work which is prejudicial to the author's honour or reputation. I believe that those words enhance the
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clarity of the integrity right and have the added advantage of familiarity. I hope these amendments meet the concerns expressed by the noble Lord, Lord Lloyd of Kilgerran, and the views expressed by the noble Lord, Lord Morton of Shuna, on the same subject. I beg to move Amendment No. 60.
Lord Morton of Shuna: My Lords, I am very grateful for this modification of the definition which makes the matter much clearer and more precise. That is especially so as regards the definition of what amounts to derogatory treatment which, as I understand it, Amendment No. 62 makes much clearer than the original definition in the Bill. I thank the Minister for taking on board the suggestion that both I and the noble Lord, Lord Lloyd of Kilgerran made.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 61 to 75:
Page 29, line 10, leave out ("modification") and insert ("treatment").
Page 29, line 15, leave out paragraph (b) and insert—
("(b) the treatment of a work is derogatory if it amounts to distortion or mutilation of the work or is otherwise prejudicial to the honour or reputation of the author or director.").
Page 29, line 18, leave out from ("section") to end of line 20 and insert ("references to a "derogatory treatment") of a work shall be construed accordingly.").
Page 29, line 24, leave out ("modified version") and insert ("derogatory treatment").
Page 29, line 27, leave out ("modified version") and insert ("derogatory treatment").
Page 29, line 30, leave out ("modified version") and insert ("derogatory treatment").
Page 29, line 32, leave out ("modified version") and insert ("derogatory treatment").
Page 29, line 33, leave out ("modified version") and insert ("derogatory treatment").
Page 29, line 39, leave out ("modified version") and insert ("derogatory treatment").
Page 29, line 42, leave out ("unjustified modification") and insert ("derogatory treatment").
Page 29, line 46, leave out ("modified version") and insert ("derogatory treatment").
Page 30, line 1, leave out ("modified version") and insert ("derogatory treatment").
Page 30, line 3, leave out ("modified version") and insert ("derogatory treatment").
Page 30, line 5, leave out ("modification") and insert ("treatment").
Page 30, line 6, leave out ("modification") and insert ("treatment").
On Question, amendments agreed to.
[Amendment No. 76 not moved.]
Clause 76 [Cases in which modification need not be justified]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 77:
Page 30, line 11, leave out from second ("right") to end of line 12 and insert ("to object to derogatory treatment of work) is subject to the following exceptions.").
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 78:
Page 30, line 15, leave out subsection (3).
The noble Lord said: My Lords, in moving Amendment No. 78 I shall speak also to Amendments Nos. 81 and 83. In our discussions on

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Report about possible exceptions to moral rights, the noble Lord, Lord Morton of Shuna, raised a valid point about the integrity right which we are now following up in this amendment. Concern was expressed about an employed author or director who is identified on a work that has been subjected to derogatory treatment. If the work was published, or exploited in some other way, the employee would have no remedy.
That certainly did not seem fair and we feel that the best way to deal with such a situation is for employed authors and directors to be given the integrity right where they are identified, or have previously been identified, but for the right not to be infringed if the derogatory treatment is accompanied by a disclaimer which explains that the work has been modified without consent. This will apply to authors and film directors when the copyright in their works vests in an employer, the Crown or an international organisation.
The disclaimer must be clear and reasonably prominent and if the author or director is identified on the work, appear with the identification. Thus the employed director of a film which was cut to half its original length for television showing would be entitled to a disclaimer in the credits of the film. I hope this meets the noble Lord's concerns.
Perhaps I may mention here that the reason I did not move Amendment No. 76 a moment ago is that it refers to line 22 when it should refer to line 10. It was intended as a paving amendment for Amendments Nos. 78, 81 and 83. This will also have to be put right in another place. I beg to move Amendment No. 78.
Lord Morton of Shuna: My Lords, it seems to be my pleasant job this evening just to say thank you to the Government for having taken on board various of my suggestions. I do it again and thank the Government very much for doing so.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 79:
Page 30, line 25, leave out subsection (4) and insert—
("(4) The right does not apply in relation to any work made for the purpose of reporting current events.
(4A) The right does not apply in relation to the publication in—

(a) a newspaper, magazine or similar periodical, or

(b) an encyclopaedia, dictionary, yearbook or other collective work of reference,

of a literary, dramatic, musical or artistic work made for the purposes of such publication or made available with the consent of the author for the purposes of such publication.
Nor does the right apply in relation to any subsequent exploitation elsewhere of such a work without any modification of the published version.").
On Question, amendment agreed to.
[Amendment No. 80 not moved.]
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 81:
Page 30, line 30, leave out subsection (5).
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 82:
Page 30, line 36, at end insert—
("(6) The right is not infringed by anything done for the purpose of—

(a) avoiding the commission of an offence, or

(b) complying with a duty imposed by or under an enactment, provided, where the author or director is identified at the time of the relevant act or has previously been identified in or on published copies of the work, that there is a sufficient disclaimer.

(7) A "sufficient disclaimer" means an indication that the work has been subjected to treatment to which the author or director has not consented which—

(a) is given at the time of the relevant act, and

(b) if the author or director is then identified, appears along with the identification,

and which is clear and reasonably prominent.").
The noble Lord said: My Lords, we looked at this matter on Report and the possibility of making exceptions to the integrity right in respect of modifications made in pursuance of statutory requirements. This was in response to an amendment tabled by the noble Lord, Lord Lloyd of Kilgerran. This amendment to Clause 76 makes such an exception.
It provides that modifications may be made to a work to avoid committing a criminal offence or to meet statutory requirements without infringing the integrity right. This is subject to a sufficient disclaimer being made in cases where the author is or has previously been identified in or on published copies of the work. I explained this new idea of sufficient disclaimer in speaking to Amendment No. 83.
Subject to one point, I hope this will meet the concerns expressed on Report on behalf of broadcasters who sometimes have to make modifications in respect of obscenity or acts of violence shown on television. That one point is of course the position of the BBC. I have already spoken about it on Amendment No. 48, and what I said there applies here also. I am afraid that the BBC will have to wait until this Bill is considered in another place to discover how its concerns are to be met. I beg to move.
Lord Lloyd of Kilgerran: My Lords, I thank the Minister for bringing forward an amendment which was adumbrated by me in the earlier proceedings on this Bill.
On Question, amendment agreed to.
The Deputy Speaker (Lord Renton): My Lords, Amendments Nos. 83, 84, 85 and 86 have already been discussed with previous amendments. Subject to your Lordships' wishes, I put them en bloc.
Lord Beaverbrook: My Lords, I understand that I have to move these amendments formally.
The Deputy Speaker: My Lords, I call Amendment No. 83.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 83:
After Clause 76, insert the following new clause:
("Qualification of right in certain cases.
.—(1) This section applies to works in which the copyright originally vested—

(a) in the author's employer by virtue of section 11(2) (works produced in course of employment),

(b) in the director's employer by virtue of section 9(2)(a) (person to be treated as author of film),

(c) in Her Majesty by virtue of section 154, or

(d) in an international organisation by virtue of section 155.

(2) The right conferred by section 75 (right to object to derogatory treatment of work) does not apply to anything done in relation to such a work by or with the authority of the copyright owner unless the author or director—

(a) is identified at the time of the relevant act, or

(b) has previously been identified in or on published copies of the work;

and where in such a case the right does apply, it is not infringed if there is a sufficient disclaimer.
(3) A "sufficient disclaimer" means an indication that the work has been subjected to treatment to which the author or director has not consented which—

(a) is given at the time of' the relevant act, and

(b) if the author or director is then identified, appears along with the identification,

and which is clear and reasonably prominent.").
On Question, amendment agreed to.
Clause 77 [Infringement of right by possessing or dealing with modified work or copy]:
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 84 and 85:
Page 30, line 37, leave out ("not to suffer modification)") and insert ("to object to derogatory treatment)").
Page 31, line 2, leave out ("unjustified modification") and insert ("derogatory treatment").
On Question, amendments agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 86:
After Clause 78, insert the following new clause:
("Right to privacy of certain photographs and films.
.—(1) A person who for private and domestic purposes commissions the taking of a photograph or the making of a film has, where copyright subsists in the resulting work, the right not to have—

(a) copies of the work issued to the public,

(b) the work exhibited or shown in public, or

(c) the work broadcast or included in a cable programme service; and, except as mentioned in subsection (2), a person who does or authorises the doing of any of those acts infringes that right.

(2) The right is not infringed by an act which by virtue of any of the following provisions would not infringe copyright in the work—

(a) section 31 (incidental inclusion of work in an artistic work, film, broadcast or cable programme);

(b) section 45 (parliamentary and judicial proceedings);

(c) section 46 (Royal Commissions and statutory inquiries);

(d) section 50 (acts done under statutory authority).").

On Question, amendment agreed to.
Clause 79 [Duration of rights]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 87:
Page 32, line 11, leave out from ("director)") to ("continue") in line 12 and insert (", section 75 (right to object to derogatory treatment of work) and section (Right to privacy of certain photographs and films) (right to privacy of certain photographs and films)").
On Question, amendment agreed to.
6.45 p.m.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 88:
Page 32, leave out lines 13 and 14.
The noble Lord said: My Lords, in moving this amendment I shall speak to Amendments Nos. 99, 103, 132, 133 and 134.
We discussed both in Committee and on Report what should happen to moral rights when the author dies. Concern was expressed about the lapse of the paternity and integrity rights in situations where neither a specific bequest had been made nor would the rights pass with copyright as part of the estate. I agreed on Report that it would be unreasonable not to give the paternity and integrity rights the same treatment as the false attribution right and promised to return with government amendments to meet the concerns of the noble Lord, Lord Morton of Shuna.
The amendments to Clause 88 provide that after the death of the author moral rights are exercisable by his personal representatives if there is no specific bequest or if the rights do not pass with copyright. Subsection (5) is split into two so that new subsection (6) can apply to subsection (1) as well as to subsection (5).
Amendments Nos. 132, 133 and 134 make the equivalent changes for the transmission of rights in performances upon the death of the performer. I beg to move.
Lord Morton of Shuna: My Lords, this is where I repeat myself. I thank the noble Lord for the consideration given to the problems I had at an earlier stage. I think he has met the problems.
On Question, amendment agreed to.
Clause 81 [Application of provisions to joint works]:
The Deputy Speaker: My Lords, Amendments Nos. 89 and 90 have already been discussed with Amendment No. 60, and I put the Question on these amendments together.
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 89 and 90:
Page 32, line 40, leave out ("not to suffer modification)") and insert ("to object to derogatory treatment of work)").
Page 32, line 42, leave out ("modification") and insert ("treatment").
The noble Lord said: My Lords, I am told that I should formally move these amendments. I beg to move.
On Question, amendments agreed to.
The Deputy Speaker: My Lords, owing to the rapid progress that we have made I now find myself swimming against the stream and may need your Lordships' assistance from time to time.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 91:
Page 32, line 43, leave out ("Any") and insert ("A").
The noble Lord said: My Lords, in moving this amendment perhaps I may say that I am happy to give the noble Lord on the Woolsack any assistance that may be needed. I am grateful to him for all the assistance which he has given us so far.
In moving Amendment No. 91, with the leave of the House I speak also to Amendment No. 92. These are drafting amendments. Amendment No. 91 simply replaces the words "Any waiver" with the words "A waiver". The amendment to subsection (4) is necessary to make it clear that the false attribution right applies if there is any false statement as to the authorship of a work of joint authorship and not just in the situation where sole authorship is attributed to a work of joint authorship, or vice versa. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 92:
Page 33, leave out lines 3 to 6 and insert—

"(a) by any false statement as to the authorship of a work of joint authorship, and

(b) by the false attribution of joint authorship in relation to a work of sole authorship;

and such a false attribution infringes the right of every person to whom authorship of any description is, whether rightly or wrongly, attributed.").
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 93:
Page 33, line I3, at end insert—
("(6) The right conferred by section (Right to privacy of certain photographs and films) (right to privacy of certain photographs and films) is, in the case of a work made in pursuance of a joint commission, a right of each person who commissioned the making of the work, so that—

(a) the right of each is satisfied if he consents to the act in question, and

(b) a waiver under section 80 by one of them does not affect the rights of the others.").

On Question, amendment agreed to.
Clause 82 [Application of provisions to parts of works]:
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 94,95 and 96:
Page 33, line 14, leave out ("right") and insert ("rights").
Page 33, line 15, leave out ("applies") and insert ("and section (Right to privacy of certain photographs and films) (right to privacy of certain photographs and films) apply").
Page 33, line 17, leave out ("not to suffer modification") and insert ("to object to derogatory treatment").
On Question, amendments agreed to.
Clause 83 [Assignment and licences]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 97:
Page 33, line 27, leave out ("acts") and insert ("things").
The noble Lord said: My Lords, with leave, I speak also to Amendment No. 153. On Report my noble friend Lord Stockton sought to insert wording, found in Section 36(2)(a) of the 1956 Act, into subsection (2) of this clause. He said that it is vital for publishers to establish that classes of book volume rights, such as paperback rights and book club rights, are rights and copyrights and that enforcement of these rights should not merely be in action for breach of contract but also for infringement of copyright.
For the reasons I gave at that time I do not think anything is necessary, but being ever willing to assist
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my noble friend when circumstances permit I return with this amendment which I hope will remove any doubts that publishers may have. The replacement of the word "acts" by the word "things" should avoid the misconstruction placed on the present draft that an assignment could not sub-divide the various restrictive acts. For example, it was believed that one had to assign the copying rights as a whole and could not assign the paperback rights while retaining the hardback rights.
As I have said, that construction of the clause is misconceived; but it should not arise with the new drafting. For the sake of consistency the corresponding Clause 204 in Part III should be amended in a like manner. I beg to move.
The Earl of Stockton: My Lords, I thank the Minister for reassuring the publishing industry which is indeed a splendid thing.
On Question, amendment agreed to.
Clause 87 [Moral rights not assignable]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 98:
Page 34, line 39, leave out from ("by") to ("are") in line 41 and insert ("Chapter IV (moral rights)")
The noble Lord said: My Lords, I have already spoken to this amendment, and I beg to move.
On Question, amendment agreed to.
Clause 88 [Transmission of moral rights on death]:
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 99 to 103:
Page 34, line 42, leave out subsection (1) and insert—
("(1) On the death of a person entitled to the right conferred by section 72 (right to identification of author or director), section 75 (right to object to derogatory treatment of work) or section (Right to privacy of certain photographs and films) (right to privacy of certain photographs and films) —

(a) the right passes to such person as he may by testamentary disposition specifically direct,

(b) if there is no such direction but the copyright in the work in question forms part of his estate, the right passes to the person to whom the copyright passes, and

(c) if or to the extent that the right does not pass under paragraph (a) or (b) it is exercisable by his personal representatives.")

Page 35, line 21, leave out ("not to suffer modification") and insert ("to object to derogatory treatment")
Page 35, line 22, after ("work)") insert ("or section (Right to privacy of certain photographs and films) (right to privacy of certain photographs and films)")
Page 35, line 24, leave out ("modification") and insert ("treatment or act")
Page 35, line 30, leave out from beginning to ("in") in line 32 and insert—
("(5) Any infringement after a person's death of the right conferred by section 78 (false attribution) is actionable by his personal representatives.
(6) Any damages recovered by personal representatives by virtue of this section")
On Question, amendments agreed to.
Clause 92 [Right to seize infringing copies, &c.]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 104:
Page 36, line 34, leave Out paragraph (b) and insert—
("(b) that at the time when any copy or article is seized the person by whom it is seized leaves at the place where it is seized a notice in the prescribed form containing the prescribed particulars as to the person by whom or on whose authority the seizure is made and the grounds on which it is made.").
The noble Lord said: My Lords, in moving Amendment No. 104, with leave, I shall speak to Amendment No. 135. These amendments concern the seizure provisions and arise from the questions which the noble Lord, Lord Williams of Elvel, asked when we discussed the matter at Report stage. The noble Lord in fact asked three questions. His first was, in effect, is the expression "a local police station" sufficiently clear. At the time I said that I thought it was, and having reflected on the matter, I believe that I was right. It is a simple question of fact. As a result, I am not proposing any change.
However, I am proposing a change in response to the noble Lord's second question. This was: how long after a seizure is effected could the prescribed notice he delivered? As I said at Report stage, it was our intention that the notice should be left at the time the seizure is made and I am very grateful to the noble Lord for pointing out that the clause did not quite say this. The amendments will I think put the matter right.
The noble Lord's final question concerned the clarity of the notice, bearing in mind that it will be aimed at street traders and not, we hope, at lawyers. As I said at Report, we were also concerned about this and had therefore proposed to take powers to specify the form that the notice should take. Prompted by the noble Lord's question, we have looked at this again. As a result, we have decided that we could usefully tighten things up a little. The amendments will ensure that not only will the notice have to be in the prescribed form, but it will also have to give prescribed details concerning the grounds on which the seizure is made. In this way we shall be able to ensure that the notice sets out all relevant information in the clearest possible terms.
I very much hope that these amendments will remove any remaining concerns. As I said, I am very grateful to the noble Lord, Lord Williams, for what I hope he will allow me to describe as his constructive probing. I beg to move.
Lord Morton of Shuna: My Lords, on behalf of my noble friend Lord Williams, I should like again to say thank you. It is very pleasant that on this occasion it seems that some of the suggestions from this side of the House are acceptable and are acted upon. We hope that this approach will move into other Bills and perhaps they may be treated in the same way.
On Question, amendment agreed to.
Clause 96 [Remedies for infringement of moral rights]:
The Deputy Speaker: My Lords, Amendments Nos. 105, 106 and 107 have been discussed. Does the noble Lord move them?
Lord Beaverbrook: My Lords, with leave I move those amendments en bloc.
Page 38, line 14, leave out from ("of") to end of line 17 and insert ("a right conferred by Chapter IV (moral rights)")
Page 38, line 21, leave out ("not to suffer modification") and insert ("to object to derogatory treatment")
Page 38, line 24, leave out from ("court,") to end of line 25 and insert ("dissociating the author or director from the treatment of the work.")
On Question, amendments agreed to.
Viscount Brentford Viscount Brentford moved Amendment No. 108:
Before Clause 97, insert the following new clause:
("Presumptions.
.—(1) In proceedings brought by virtue of this Chapter it shall be presumed, in the absence of evidence to the contrary—

(a) that copyright subsists in the work to which the action relates, and

(b) that the plaintiff, if he claims to be the owner of the copyright, is the owner.

(2) Where in any such proceedings the plaintiff claims to be exclusive licensee and shows that a document purporting to grant an exclusive licence was signed by or on behalf of a person purporting to be the copyright owner, it shall be presumed in the absence of evidence to the contrary that that person was the owner of the copyright at the time the licence was granted.")
The noble Viscount said: My Lords, at earlier discussions on this Bill my noble friend the Minister suggested that the presumptions in favour of different parties as set out at present in Clauses 95 and 96 were adequate. In Clause 95 there are presumptions in favour of an author. In Clause 96 there is a presumption in favour of the owners of sound recordings and films. I suggest that without the wording in Amendment No. 108 there are no presumptions in favour of the copyright owners of the literary, dramatic or musical works themselves. This amendment seeks to rectify the defect. It is only the copyright owners or in some cases their exclusive licensees, who are permitted to sue for infringement. This amended clause fills that vacuum. I beg to move.
Lord Beaverbrook: My Lords, this amendment seeks to reinstate a clause which your Lordships agreed should be left out at Report stage. Clause 94, as it then was, found few friends in Committee and was strongly criticised both inside and outside your Lordships' House. I am rather surprised to see it resurface so quickly after what I had hoped was a decent burial.
The rejected Clause 94 which this amendment seeks to restore may seem justified when one is considering a case of out-and-out piracy. For example, it may be glaringly obvious to the layman that the latest box office and video rental hit from Hollywood is entitled to copyright and that the producer or his successor in title owns that copyright, and in such circumstances the presumptions set out in this amendment might seem reasonable. But this is only one end of the spectrum of cases of infringement which the courts will have to consider, and elsewhere in that spectrum these presumptions would give wholly the wrong result. For example, a defendant may be alleged to have infringed copyright in an artistic work by using that work as the design of wallpaper.
The defendant may well deliberately have copied that design from an existing source, but be under the

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impression either that that source was in the public domain or that the person who gave him permission to copy the design from that source was entitled to do so. He is in no position to produce evidence to dispute the plaintiff's claim until he knows what the plaintiff is alleging as the basis for his claim.
For example, the plaintiff might claim that the design apparently within the public domain was first drawn by a very youthful artist who lived to a very great age and died 49 years ago and that he, the plaintiff, is the assignee of the artist's great grandson. That situation may be highly improbable, but not impossible, and the very stuff of legal proceedings. That sort of claim might not even get beyond cross-examination. If it did, the defendant ought to be allowed to see the particulars of the plaintiff's claim before having to decide whether to defend it and, if so, upon what grounds. He should not have to produce evidence which he does not have in order to rebut a presumption which may have no foundation.
I believe your Lordships were right to reject the old Clause 94. I do not want to go over the ground we covered a little over four weeks ago, but your Lordships may recall that I referred to the "Notice to admit" procedures, which the noble Viscount, Lord Brentford, has mentioned today I believe. The noble and learned Lord, Lord Donaldson of Lymington, before he became a member of this House, said in an unreported case in the Court of Appeal referred to in Supreme Court Practice:
"The powers given by Order 27 are all too rarely exercised. The use of those rules and the penalties as to costs are of the greatest importance in the administration of justice and ought to be relied on more frequently".
The procedure endorsed by the noble and learned Lord should not be dismissed until it has been tried in the copyright field and found wanting. But in any event, there can be no going back to the extreme presumptions contained in this amendment. For that reason, I oppose my noble friend's amendment.
Viscount Brentford: My Lords, I appreciate the very full answer given by my noble friend. I am glad that he can see the reasonable circumstances that can give rise to it. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 101 [Forfeiture of infringing copies, &c.]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 109:
Page 40, line 43, after ("it") insert ("has been or").
The noble Lord said: My Lords, in moving this amendment, I also speak, with leave, to Amendment No. 160.
On Question, amendment agreed to
7 p.m.
Clause 104 [Infringing copies may be treated as prohibited goods]:
Viscount Brentford Viscount Brentford moved Amendment No. 110:
Page 42, line 7, leave out ("printed").
The noble Lord said: My Lords, the text of Clause 104 gives the owners of printed works and of sound
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recordings and films a right to request the commissioners of Customs and Excise to stop those goods being imported. As it is often the copyright works embodied in a sound recording or film that need to be treated as prohibited goods, the amendment seeks to extend the facility to other copyright owners.
My noble friend has previously resisted amendments along these lines mainly on practical grounds and in particular because of the difficulty that the commissioners might have in checking computer programs at ports of entry. I suggest that this practical problem could be eased by the commissioners making regulations under the power given to them by Clause 105 to require copyright owners of the recorded material to give the commissioners details of the relevant sound recordings or films. All the commissioners will then have to do is find the sound recording or film. I beg to move.
Lord Mottistone: My Lords, I support the amendment, having moved earlier amendments along these lines. The solution suggested by my noble friend is a good one The arguments were that the poor old customs officers were so overworked that they could not cope. I do not think that that is good enough. The amendment deserves inclusion in the Bill.
Lord Lloyd of Hampstead: My Lords, I moved an amendment along these lines on a previous occasion but withdrew it because the Minister put forward practical considerations that seemed difficult to resist. If, as suggested, there are ways of meeting these practical difficulties for the commissioners of Customs and Excise, perhaps the point deserves reconsideration. Therefore, I support the amendment.
Lord Beaverbrook: My Lords, an identical amendment was tabled in Committee and on Report, and I must again resist it. As I pointed out in Committee, Clause 104 introduces a significant change in the law in relation to the importation of infringing films and sound recordings. However, due to practical considerations and resource constraints we cannot do much more. I explained the reasons very fully in Committee and on Report, and I do not intend to go over the ground yet again. If any noble Lord wishes to know the reasons, I refer him to the relevant Hansard.
I have listened carefully to what my noble friend has said. There is much more to the question of resource difficulties than can be cured merely by the notification that he suggested. Computer programs in particular require special equipment in order to be read.
I regret that I am not convinced by what has been said by my noble friends Lord Brentford and Lord Mottistone. The major considerations are resources, and I stand by what I said at an earlier stage.
Viscount Brentford: My Lords, I am grateful to my noble friend for his explanation. I remain concerned about the balance in the Bill. The Minister has not

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been able to accept any of the amendments that I have put forward, particularly on behalf of composers and their publishers, which have so far failed on home taping, on rental, on limiting the ephemeral and on reinstating the presumption for onus exemption.
I can only hope that the Government will reconsider these points when the Bill goes to another place. I remind noble Lords that the Secretary of State for Trade and Industry on Second Reading said that those with ideas deserve to receive a fair reward. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 107 [Licensing schemes and licensing bodies]:
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran moved Amendment No. 111:
Page 44, line 12, at end insert—
("(1 A) Any conditions which are printed on or issued in association with a copyright item may not restrict or prohibit an act which is not an infringement under this Part unless the conditions are also included in a licensing scheme.").
The noble Lord said: We have reached another chapter of the Bill concerning licensing schemes and licensing bodies of which Clause 107 is the first clause.
The purpose of the amendment is to deal with questions arising at what is technically known as point of sale licensing; that is, printing of details of terms on each journal issue as part of a licensing scheme. The amendment is considered important from the point of view of the Library Association. The conditions covered in the amendment are straightforward. I notice with some gratitude that the noble Earl, Lord Stockton, nods his head in what I hope is approval.
The purpose of the amendment is to stem the use by publishers of what is known as a negative form of point of sale licensing. It is advisable for reminders of statutory copyright to appear on items sold. It is desirable for items to show positive point of sale licensing details as to how payments may be made for the extensions of legal allowances. It appears inappropriate to my advisers to print on items various restrictions of actions which are neither infringements nor conditions in the formal licence.
If the practice is to remain as drafted in the Bill, it will cause confusion and prevent a potential purchaser from exercising his normal rights of use. The prohibitive phrases are mostly unseen at the time of purchase. The fear of litigation succeeding unfairly on implied contract grounds, despite the absence of a statutory basis, would be removed by the amendment. I beg to move.
Lord Beaverbrook: My Lords, we have not had as long to consider the amendment as we might have wished. However, from briefing material circulated by the Library Association we surmised that the purpose was to prevent contract from prohibiting acts which are permitted under copyright law. I have to say that Clause 107 is rather a curious place to provide such an amendment, but I would have to resist the amendment wherever it was placed.
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The exceptions to copyright in Chapter III of Part I of the Bill do not confer inalienable rights on users of copyright material. They can be negated by contract. The person selling copyright material is free to impose any conditions he wishes in his contract of sale. If the buyer cannot accept those conditions, he can decline to buy. A common condition imposed on the sale of books prohibits rebinding. That has nothing to do with copyright. There is no restricted act of binding a copyright work and, obviously, no exception to be negated.
Rather than going the way suggested in this amendment, we are giving serious thought to tabling an amendment in another place to provide a specific reference in Chapter III to the fact that contract may override its provisions. For example, it is imperative that those who make expensive training films are able to impose conditions in their contracts of supply to their customers. The same applies to expensive computer programs on disc or magnetic tape.
The copyright owner must be in a position to prohibit onward transmission by sale or hire of such valuable commodities. I cannot accept that he should be able to prohibit acts which would damage his interests only if he joins a licensing scheme. Joining a licensing scheme will usually be the last thing such copyright owners would wish to do. Part of the reason they exercise such tight contractual control over copies is to limit the opportunity for copying. For those reasons I must resist the amendment tabled in the name of the noble Lord, Lord Lloyd of Kilgerran. However, I should emphasise to him that we are, as I have already said, considering the possibilities in the matter.
Lord Lloyd of Kilgerran: My Lords, I must again apologise for the lateness with which this amendment was lodged. I am grateful to the Minister for what he has said and in the circumstances I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 112:
Page 44, line 17, leave out ("extending to the works of several authors") and insert ("covering works of more than one author").
The noble Lord said: My Lords, in moving Amendment No. 112 I shall, with the leave of the House, speak also to Amendments Nos. 113, 116 and 129. The intention of Clause 107 has always been to define a licensing body so as to cover organisations whose licensing activities are concerned with the works of a number of unconnected authors. Recently it has been pointed out to us that as drafted the definition could apply to a body whose licensing activities are confined to a single collective work, or collective works, of which the authors are the same. That would not be right and such a situation was never intended by us. Therefore the amendments to Clause 107 seek to rectify that situation. The amendment to Clause 115 is a consequential drafting amendment and the amendment to Clause 166 is the usual addition of another defined term to the list. I beg to move.
Lord Williams of Elvel: My Lords, I have no comment to make on the Government's amendment.

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However, it would be appropriate for me to comment on the grouping which the Minister has put forward. The tight grouping, which as I understand it is the final version produced by the Government Whip, places Amendment No. 112 together with Amendment No. 116. Nevertheless, I think the Minister said that he was also speaking to Amendment No. 129. We have had trouble on previous occasions with groupings in Bills and I must say that it is somewhat confusing for the Opposition if such groupings are not correct. I very much hope that the noble Lord will report back to the Government Whip that we should like the groupings to be right.
Lord Beaverbrook: My Lords, it seems that an error has somehow crept in, either in the Marshalled List or perhaps in my own notes. However, these amendments sit together and I should just say that it is an error on the right side in that we have slightly overgrouped on these small amendments, rather than the other way round, which would have been rather less helpful to the House.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 113:
Page 44, line 19, at end insert—
("(4) References in this Chapter to licences or licensing schemes covering works of more than one author do not include licences or schemes covering only a single collective work or collective works of which the authors are the same.").
The Deputy Speaker: My Lords, is it just Amendment No. 113 that is being moved at this stage? I think the noble Lord could go as far as Amendment No. 116, as all those amendments have been referred to in discussion.
Lord Williams of Elvel: My Lords, with respect, I do not think the noble Lord has spoken to Amendment No. 113.
The Deputy Speaker: My Lords, the other amendments have not been discussed so it is just a question of Amendment No. 113 at present.
On Question, amendment agreed to.
7.15 p.m.
Clause 109 [Reference of proposed licensing scheme to tribunal]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 114:
Page 45, line 1, leave out from ("a") to ("be") in line 2 and insert ("licensing scheme proposed to be operated by a licensing body may").
The noble Lord said: My Lords, in moving this amendment I shall speak also to Amendments Nos. 115, 117 and 118. I said on Report, when replying to the noble Lord, Lord Lloyd of Kilgerran, that we were persuaded that a case existed for enabling would-be licensees to refer to the Copyright Tribunal, without the consent of the licensing body, prospective schemes of licences which a licensing body might have offered to them. I promised that provided we were satisfied that this would not result in an unacceptable degree of compulsory licensing
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or a breach of our convention obligations we would return with our own amendments.
These amendments fulfil that undertaking. On the issue of compulsory licensing the clauses as amended will, as before, apply only to schemes which it is actually proposed should be operated and to licences which it is actually proposed should be granted. Moreover, they will only be applicable to schemes or licences offered by licensing bodies, which are by definition in the business of licensing their repertoires for general use.
There will be no compulsion on any individual copyright owner who does not want to licence his work for the use in question. Nor will it be possible to take a licensing body to the tribunal in circumstances where no scheme or licence has been offered and where no such offer is intended, unless those circumstances come within Clause 112. We are satisfied that this is sufficient protection for the copyright owner who does not want to license his works for a particular use.
As I said on Report, we recognise that there must nonetheless be a means whereby users, such as broadcasters, can gain access on arbitrated, equitable terms to the works controlled by monopoly licensing bodies, when agreement on terms cannot be reached by voluntary negotiation. The amendments will ensure that that will continue to be possible in the future, as it is already in practice under the 1956 Act.
However, we have incorporated one extra safeguard, which is that the tribunal will have a discretion to judge whether a reference is premature before deciding whether to entertain it. Obviously the tribunal should not have to consider a proposed scheme or licence which is at such an early stage of its drafting that no sensible order could be made in respect of it. The substance of the change as regards licensing schemes is contained in the amendments to Clause 109, and as regards licences in the amendments to Clause 116. I beg to move.
Lord Lloyd of Kilgerran: My Lords, I am most grateful to the Minister for bringing forward these amendments, based on amendments which I originally tabled.
On Question, amendment agreed to.
The Deputy Speaker: My Lords, it would seem that Amendments Nos. 115 to 118 inclusive have already been discussed. Therefore, does the noble Lord wish to move them?
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 115 to 118:
Page 45, line 7, after ("shall") insert ("first decide whether to entertain the reference, and may decline to do so on the ground that the reference is premature.
(2A) If the Tribunal decides to entertain the reference it shall").
Clause 115, page 48, line 7, leave out ("the").
Clause 116, page 48, line 20, leave out (", with the consent of the licensing body,").
Page 48, line 22, after ("shall") insert ("first decide whether to entertain the reference, and may decline to do so on the ground that the reference is premature.
(2A) If the Tribunal decides to entertain the reference it shall").
On Question, amendments agreed to.
Clause 152 [Denial of copyright protection to citizens of countries not giving adequate protection to British works]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 119:
Page 64, line 30, leave out ("copyright protection given") and insert ("rights conferred by this Part in relation").
The noble Lord said: My Lords, with leave, I shall speak also to Amendments Nos. 120 and 121. These are amendments to Clause 152, and with them I am honouring a commitment previously given to the noble Lord, Lord Lloyd of Kilgerran, on Report. The noble Lord moved that a new clause, which was closely modelled on what is now Clause 152, should be inserted in the Bill. As he explained, his object was to avoid moral rights being conferred on authors and directors whose countries do not confer similar rights on British authors and directors.
I accepted the desirability of providing powers to deny moral rights to citizens of countries not giving adequate protection to British authors in the same way as Clause 152 provides such powers in respect of adequate protection of copyright. As I indicated at the time, I think we can achieve this object by amendment of the copyright clause rather than providing an additional, virtually identical, moral right clause. I hope the amendments meet the concerns of the noble Lord. I beg to move.
Lord Lloyd of Kilgerran: My Lords, I should briefly like to thank the Minister and his officials for bringing forward the amendments, which are based on what I originally suggested.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 120 and 121.
Page 64, line 33, leave out from ("that") to ("for") in line 34 and insert (", for the purposes specified in the Order, works first published after a date specified in the Order shall not be treated as qualifying").
Page 64, line 40, after ("provision") insert ("for all the purposes of this Part or for such purposes as are specified in the Order, and").
On Question, amendments agreed to.
Clause 154 [Crown copyright]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 122:
Page 65, line 17, leave out ("of") and insert ("taken from").
The noble Lord said: My Lords, I must say that I am not entirely clear whether this amendment is grouped with that of the noble Lord, Lord Mottistone; namely, Amendment No. 123. However, if the noble Lord does not object, and with the leave of the House, I shall speak to Amendment No. 123 at the same time.
Amendment No. 122 is a drafting amendment. The wording of Clause 5(2) was amended on Report in response to various criticisms which had been voiced in Committee. We should have made a corresponding change in the Crown copyright provision, and that is what my amendment will do.
The more substantial amendment in the group is the one standing in the name of my noble friend Lord
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Mottistone. It seeks to remove commissioned works from the ambit of Crown copyright so that the Crown would be in the same position as any other commissioner in that it would have to acquire copyright from the author by assignment in cases where it wants copyright. This is a matter that my noble friend raised both in Committee and on Report. He has received some support from noble Lords opposite who expressed misgivings about the extent of Crown copyright, and who, if I have understood them correctly, will welcome any amendment that reduces its scope.
Our debate on Report caused me to give careful thought to the need for a commissioned works provision in Clause 154. I initiated consultations to see whether the Crown would be seriously inconvenienced if the commissioned works provision were to be deleted. In the light of those consultations, I can move on this point and I can accept my noble friend's amendment.
Although the principle underlying the amendment standing in my noble friend's name is plain, the drafting is defective because it removes one word too many. The word "or" at the beginning of the amendment needs to remain in the Bill. For that reason, I cannot accept his amendment, and so I hope he will not press it. I realise that acceptance of his amendment would be an appropriate recognition of his great persistence. But, given my assurance that he has won the day, I hope that he will let the matter rest there. I do not doubt that there will be those in another place who will ensure that the assurances I have given today will be honoured. I would accept a similar amendment to Clause 155. In the meantime, I beg to move.
Lord Mottistone: My Lords, I am grateful to my noble friend. I am sorry that there was a small error and that we were unable to have a complete triumph in the House. I am sure that our friends in another place will help us. I am grateful for the fact that after this long time my noble friend finds himself able to accept the amendment and, what is more important, the principle behind it. When my turn comes I shall move my amendment. I realise that I cannot do so. What a pity.
Lord Williams of Elvel: My Lords, I, too, am grateful to the noble Lord for affording the noble Lord, Lord Mottistone, a partial triumph. The Government have accepted that there are substantial doubts about Crown copyright in the Bill as it is presently drafted. The Government seem to have allowed a breach in that wall. I can assure the Minister that when the Bill goes to another place—if I may have the attention of the Government Front Bench—further attempts will be made to widen that breach to ensure (in so far as we can ensure it) that Crown copyright conforms with what we regard as being the proper principles and is not in blanket form, as it was in the original Bill. We are grateful for the small breach that has occurred.
On Question, amendment agreed to.
[Amendment No. 123 not moved.]
Clause 158 [Rights and privileges under other enactments or the common law]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 124:
Page 67, line 19, at end insert—
("2A) Nothing in this Part affects any rule of law preventing or restricting the enforcement of copyright, on grounds of public interest or otherwise.").
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 165 [Minor definitions]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 125:
Page 70, line 12, at end insert—
(" "collective work" means—

(a) a work of joint authorship, or

(b) a work in which there are distinct contributions by different authors or in which works or parts of works of different authors are incorporated;").

The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
[Amendment No. 126 not moved.]
Clause 166 [Index of defined expressions]:
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 127 to 129:
Page 71, line 41, at end insert—
("collective work section 165").
Page 72, line 28 [numbered 27], column 2, at end insert ("and 1(A)")
Page 73, line 21 [numbered 19], at end insert—
("work of more than one author section 107(4)") (in Chapter VII).
The noble Lord said: My Lords, I have already spoken to these amendments. I beg to move.
On Question, amendments agreed to.
Clause 170 [Infringement of performer's rights by use of recording made without consent]:
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran moved Amendment No. 130:
Page 74, line 43, at end insert ("but where a recording of the whole or a substantial part of a qualifying performance has been made with the performer's consent then the performer's consent to the making of a copy of that recording for a purpose other than that for which the recording was originally made shall not be unreasonably withheld.").
The noble Lord said: My Lords, with the leave of the House I shall speak also to Amendment No. 209 to Schedule 2. The object is to deal with the problem which I think I described on Report as the tenth spear; that is, the one recalcitrant performer in a minor role whose withholding of a consent can prevent the exploitation of a recording of a large-scale television drama and jeopardise the possibility of further remuneration to other members of the cast. That is the sole object of these amendments.
It is accepted that a performer should have the absolute right to authorise or refuse consent to the making of the first recording. It is also accepted that a performer has the right, on reasonable grounds, to refuse consent to further exploitation. But the BBC, in particular, feels strongly that once the first
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recording has been authorised the performer should not be entitled to refuse consent, without reasonable grounds for doing so, to further exploitation. I beg to move.
Lord Beaverbrook: My Lords, the noble Lord, Lord Lloyd of Kilgerran, has returned to a question about performer's consent which he raised on Report. The issue is whether broadcasters and cable operators should have to have the consent of performers when they want to make copies of authorised recordings for purposes of repeat broadcasting, cable distribution, or perhaps for marketing to other broadcasters. It is another issue that we have been discussing further with broadcasters since the Report stage.
Your Lordships may recall that I said then that we would consider what might be done if, on examination, the exception to performers' rights contained in Schedule 2 paragraph 12 turned out to be inadequate. On consideration we have come to the conclusion that the exception contained in Schedule 2 does not after all provide a sufficient answer to broadcasters' needs. I am therefore happy to accept in principle that an amendment along the lines proposed by the noble Lord is necessary. I am afraid that we shall want to reflect a little further on the wording. We shall therefore have to return to the matter in another place. I hope that in the light of my assurance the noble Lord will be willing to withdraw the amendment at this stage.
Lord Lloyd of Kilgerran: My Lords, I am grateful that the noble Lord is sympathetic to the problems of broadcasters, and upon his assurance, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 174 [Infringement of recording rights by use of recording made without consent]:
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran moved Amendment No. 131:
Page 76, line 6, at end insert ("or that of the performer").
The noble Lord said: My Lords, the amendment is summarised as being a rectification of bootleg recordings. I am advised that where a recording has been made without the consent of a performer or the recording company, Clause 174, as drafted, requires that if the BBC, for instance, wishes to broadcast the recording the consent of the recording company must be obtained.
By contrast, Clause 173, which deals with the making of a recording of a performance in relation to which a recording company has recording rights, provides that the maker of the recording can obtain consent from one or other of the performers or the recording company. It is therefore difficult to see what justification there is for the distinction between the two clauses. As the legislation confers upon performers and recording companies the same rights in relation to performances before the commencement of the new legislation as in relation to those taking place after, a broadcaster may be unable to locate the relevant recording company which may by now be defunct to obtain the consent for the

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broadcast of a perhaps unique recording of a performance. I beg to move.
Lord Beaverbrook: My Lords, the noble Lord's amendment deals with a point which has recently been drawn to our attention by the BBC. If a broadcaster has made a recording of a concert and has inadvertently failed to obtain the consent of all the performers, then exploiting that recording may infringe not only the rights of those performers but also the rights of those with whom they have exclusive recording contracts. If the broadcaster wants to rectify the situation, he will, as matters stand under the Bill, be obliged to obtain the consent of the recording company.
The purpose of the noble Lord's amendment is to provide that it will be a sufficient alternative to obtain the consent of the performer. I must point out that in the circumstances envisaged by the BBC it is the person with recording rights rather than the performer whose economic interests are affected.
We cannot accept the amendment as it stands, but we shall look further at the matter and if necessary return to it in another place. It may be that in a case in which the performer also had his own rights, his consent alone would suffice. But if the performer had no rights himself, it would be of no concern to him that the recording company might be adversely affected. Therefore, the performer's consent should not suffice. In other words, the performer's consent should suffice only in the case of qualifying performances. I hope that in the light of my assurance the noble Lord may be able to withdraw his amendment at this stage.
Lord Lloyd of Kilgerran: My Lords, I am very grateful to the noble Lord for the attention that he has given to this matter. In view of his assurances I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Earl of Dundee: My Lords, your Lordships may consider that we have reached a suitable moment to break in order to return to the subject in an hour's time at 8.30. If so, I beg to move that the further proceedings after Third Reading be now adjourned.
Moved accordingly, and, on Question, Motion agreed to.
Housing Benefit (General) Amendment Regulations 1988
Housing Benefit (Supply of Information) Regulations 1988
Social Security (Payments on account, Overpayments and Recovery) Regulations 1988
Income Support (General) Amendment Regulations 1988
Family Credit (General) Amendment Regulations 1988
7.30 p.m.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Skelmersdale): My Lords, I beg to move the first
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Motion standing in my name on the Order Paper. I shall try hard not to confuse the noble Baroness, Lady Jeger, as much as I unfortunately did yesterday. However, as all the Motions in my name on the Order Paper today are what I might describe as pure social security amendment regulations, I trust that the House will allow me to speak to all of them at once and in due course to move them en bloc, as has been noted on today's Order Paper.
The first three regulations contain a number of amendments to regulations which were debated and approved by the House in November last year, setting out the detailed rules for the introduction of the new income support, family credit and housing benefit schemes from April. Your Lordships will be well aware of the background to the income related benefit changes and will therefore be relieved that I do not intend to rehearse again tonight the reasons underlying them. Most of the changes in the amendment regulations are necessary to correct minor or technical deficiencies in the original set.
One aspect of this block of amendment regulations will however find special favour with the House. It enables any income or capital received from the Macfarlane Trust, set up to help haemophiliacs who are unfortunately HIV positive, to be ignored completely in assessing a person's entitlement to income support, family credit or housing benefit. The most notable part of these is that claimants will not be required to declare receipt of any such payments to the department or their local housing authorities. I am sure that the country as a whole will particularly welcome this move, which will help to keep the individual's conditions confidential.
I should perhaps mention at this point that the Government will in due course be bringing forward similar amending regulations to disregard payments from the Independent Living Fund which, as the House will know, will enable severely disabled people on low incomes to employ help in order that they may live independently in their own homes. These are people who are in the unfortunate position of being disadvantaged if by some mischance they should become seriously disabled or their circumstances change for the worse after the new social security arrangements are brought into effect. Other amendments in this set of regulations are consequential to the 1986 Act.
The House will also be interested in housing benefit. The Housing Benefit (General) Amendment Regulations contain provisions to enable local authorities, in the still unlikely event for many, to make payments on account of housing benefit where they are unable to assess claims properly under the new scheme after 1st April. This temporary provision will run for only three months, that is until 30th June. The regulations also enable local authorities to issue short-term notices of determination for the same three-month period. I should however like to point out that from our latest information I expect only a very small proportion of local authorities, for a variety of reasons, actually to have to use these provisions.
The Housing Benefit (Supply of Information) Regulations 1988 which are also before us tonight deal with the information which is to be exchanged

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between the department and the local authorities, in accordance with Section 31(1) and (2) of the Social Security Act 1986. In detail, these regulations provide for local authorities to be supplied with information from the Department of Health and Social Security about the outcome of claims for income support and also for local authorities to be notified when entitlement to income support ceases. Local authorities will also be supplied with information necessary to calculate and recover overpayments of housing benefit. These regulations simply continue the arrangements which already apply under the existing schemes.
Moving on to the draft Social Security (Payments on account, Overpayments and Recovery) Regulations, I should say that one of the objectives of the Social Security Act 1986 was to provide a common framework for the administration of benefits. Previously many of the benefits had slightly different rules, each set down in its own set of regulations. The recovery of overpayments was one area where we provided for a single test—that of misrepresentation or failure to disclose a material fact. In 1987, regulations bearing the same title as the present draft provided the new common rules for overpayments and recoveries for all benefits and included interim payments—that is, payments on account of benefit when, for a variety of reasons, we may not be able to process a claim but the person needs to be paid quickly.
I should also like to draw your Lordships' attention to Part 8 of these regulations, which lays down the manner in which the recovery from earnings of income support payments for the first 15 days following a trade dispute shall take place.
Taken together, these five sets of regulations complete the detailed preparations for a fundamental reform of the income-related benefits system. The change will achieve a clearer and more coherent system which will be easier for claimants and staff to understand and which will focus help more effectively on those groups most in need. The regulations we are debating tonight complete the final link in this chain. I commend them to the House.
Moved, That the draft Housing Benefit (General) Amendment Regulations 1988 laid before the House on 14th March [20th Report from the Joint Committee]; Housing Benefit (Supply of Information) Regulations 1988 laid before the House on 14th March [20th Report from the Joint Committee]; Social Security (Payments on account, Overpayments and Recovery) Regulations 1988 laid before the House on 7th March [20th Report, from the Joint Committee]; Income Support (General) Amendment Regulations 1988 laid before the House on 16th March [20th Report from the Joint Committee]; and Family Credit (General) Amendment Regulations 1988 laid before the House on 16th March [20th Report from the Joint Committee] be approved—(Lord Skelmersdale.)
Baroness Jeger: My Lords, we appreciate that all the regulations should be taken together. However, the most important element in the Motions concerns housing benefit. I am glad to see that the noble Lord
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is talking about all these matters tonight. I am also very glad that my noble friend Lord Stallard is with us and that he has recovered after surgery and attention at the Westminster Hospital. I am sure that my pleasure at his recovery is shared by all noble Lords.
There are several problems about these regulations. I appreciate what the noble Lord is trying to do. However, we are trying to work out how we can deal with disabled people who will not get any help under the new system. The citizens' advice bureaux have said today that they believe that under the new system more people are going to be worse off than are going to be better off. People will have to pay water rates, which they did not have to pay before. That makes it very difficult for us to see whether the Government's policy will help the poorest people or whether it will make life more difficult for them.
I know that we cannot deal with these things by a vote tonight but I have to say that I think we are not making it clear in this House that the Government really care about the poorest people.
I have a cutting from The Times which states that sick and disabled people:
"stand to lose by up to £18 a week under the new social security reforms".
When we are asked to deal with these matters tonight it is very difficult for us to see where the regulations relate to the facts of the situation. All I can say tonight on behalf of my noble friends is that we do not approve of these regulations and that we hope at some time that there might be some reconsideration.
Lord Banks: My Lords, the House is indebted once again to the noble Lord, Lord Skelmersdale, for his explanation on this occasion of no fewer than five sets of regulations. The regulations complete the framework for the new regime which comes into force next week. The House may think that they do so just in the nick of time.
The noble Lord will be aware that we on these Benches have many criticisms and many anxieties about that new regime. The Government say that two-thirds of claimants will be better off; but of course that was challenged by the benefits research unit at the University of Nottingham when it set out its view in the Guardian on 24th February. It reckoned that 60 per cent. of those changing from supplementary benefit to income support will be worse off.
Yesterday the Department of Social and Administrative Studies at Oxford University was reported as saying that in its view 75 per cent. of claimants would be worse off. Today as the noble Baroness, Lady Jeger, has said, the National Association of Citizens' Advice Bureaux has issued the results of a survey which it conducted of 80 of its cases in an area of the country chosen at random. That would seem to indicate that as regards the sick and disabled there are five times more losers than gainers; five out of six sick people would be worse off if this survey is an indication of what is going to happen. And 70 per cent. of able-bodied pensioners would also be worse off. It is responsible people who are saying these things. So it is no wonder that we have anxieties.

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These regulations, as the noble Lord said, make a number of comparatively minor changes to the regulations approved last year. He mentioned in particular three of the orders dealing with income supplement, family credit and housing benefit respectively which provide for payments from the Macfarlane Trust to be disregarded. That is welcome as is the maintenance of confidentiality with regard to those payments.
I should like to ask the Minister about the Independent Living Trust which has been established in order to provide help for the very severely disabled. I understand that payments made from that trust are also to be disregarded. Can the Minister say when provisions for that will come before Parliament?
The provisions for the exchange of information for housing benefit purposes between the Department of Health and Social Security and local authorities appear sensible as does the provision to allow local authorities to calculate housing benefit on a rough and ready basis for the first three months.
But I am concerned about two points with regard to that. First, I understand that some formula is to be followed that should prevent any significant overpayments. I should like to know more about that if the noble Lord can enlighten us. It does seem that a claimant may have no idea that he is being overpaid and may be faced with the difficult problem of the repayment of a considerable sum. Will the noble Lord say how that is to be avoided?
My second point relates to the noble Lord's statement that he expects only a very small number of local authorities to be unable to proceed on the proper basis next week. It is encouraging to hear him say that but it runs in the face of a lot of information that has been conveyed in the press and indeed in the debate on this subject in another place where it was variously suggested that 17 per cent. of local authorities, 101 out of 281 local authorities or even 50 per cent. of local authorities might not be ready. There has been talk in the newspapers of possible chaos. Can the noble Lord give us a little more information about that and say perhaps how many local authorities he anticipates will not be able to proceed on the proper basis next week and will have to use the rough and ready method of calculation? Is it not a fact that the local authorities have been put in a very difficult position owing to the late production of the regulations with only some five months to work on the changes?
Turning from housing benefit, when we discussed the Unemployment Benefit (Disqualification Period) Order 1988 dealing with disqualification for unemployment benefit because of voluntary unemployment, we made it clear that we saw no reason to extend the maximum period from 13 to 26 weeks. We said this because small numbers were involved, the last doubling of the maximum period had had no effect and there was evidence to suggest that the maximum length of disqualification was not in fact known to those affected who were not deterred by it. Of course there was the fact that those disqualified, if they qualified for supplementary benefit, had it reduced by 40 per cent.
The Income Support (General) Amendment Regulations 1988 contain the consequential and
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similar extension of the maximum period for the 40 per cent. reduction of income support. We object to that on the same grounds as we objected to the extension of the unemployment benefit disqualification maximum period and on the additional ground of the increased cumulative hardship caused by so long a period of curtailment of what is after all a subsistence benefit.
In conclusion, I wish to ask the noble Lord if he can give any indication of how many persons the Government estimate will be reliant on means-tested benefits once the new income related system is in force? The new system brings help to some on benefit by taking away from others on benefit. It takes from the poor to give to the poorer at a time when large sums are made available through tax cuts to the top 5 per cent. of earners.
I believe that the movement to greater reliance on means-tested benefits exemplified by the switch of resources this year from child benefit to family credit is retrogressive. The alternative is not a bolstering of the status quo. It is to move in the direction of a tax credit scheme designed to take people off means-tested benefits.
Lord Kilmarnock: My Lords, we also would like to thank the noble Lord, Lord Skelmersdale, for steering us rapidly through these five sets of regulations. We certainly welcome the concessions that he has indicated in respect of the Macfarlane Trust to the haemophiliacs and also the Independent Living Trust Fund.
The whole new regime that the Government are bringing into operation caused considerable disquiet on these Benches when it was first introduced. I do not think that disquiet has diminished at all as implementation draws nearer and nearer. Confusion has been sown in the public mind to a serious extent as to how people are going to be affected. I should like to ask the noble Lord whether he can tell the House what the Government are doing in the field of information to offset rumours and clarify the position of people who are going to be worse off under the new arrangements.
It seems to me that there is a particular area of concern as regards the poorest pensioners. It is calculated that many of them will be in the region of £3 or £4 a week worse off. There is also a serious area of concern as regards part-time workers who will fail to qualify under the new income support scheme if they work for 24 hours a week or more, as against the current limit of 30 hours. I understand that there are around 15,000 part-time workers who will lose the right to claim supplementary benefit and/or income support. Perhaps the Minister will comment on that matter.
I believe that I am right in saying that a large number of those people will be single parents. That group will lose out badly when the new arrangements are in operation. One of the causes of that deterioration in their situation will be the lack of transitional protection for those on housing benefit. The noble Lord, Lord Stallard, who is an expert in that area, will doubtless be talking about housing benefit. Therefore, I shall not go into that matter.

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However, I should like to hear from the noble Lord whether the Government have any plans to revise the transitional arrangements for housing benefit. I understand that the Minister's honourable friend, Mr. Scott, acknowledged in the media today that there were serious difficulties and anomalies arising from the new arrangements. However, that is hearsay and I am not sure what commitment, if any, he made to look into the ways of alleviating the transitional difficulties. Perhaps the noble Lord will say more on that subject.
Lord Stallard: My Lords, I should like to join those who have congratulated the Minister on his introduction of the regulations this evening. I should also like to agree with my noble friend Lady Jeger in her remarks on income support and family credit, and with the other noble Lords who have spoken.
I am mainly concerned with the housing benefit regulations. I believe that it is worth spending a few minutes on those matters because this will be our last opportunity to do so. I should have agreed wholeheartedly with the noble Lord, Lord Banks, had I been present last night when he raised the question of the Guardian advertisement. That concerned proceedings in Parliament. Before both Houses had agreed the regulations, they were published elsewhere. Have the Government or the Minister raised any objection with the Guardian as regards the advertisement? It seems to have been a bit arrogant. If no protest was made, that is even worse because it makes it appear that other people are agreeing with it.
Given the background and circumstances, as well as the fact that we do not have as much time as we should like, I shall not go too deeply into the first set of regulations and the supply of information. I recognise that, given the circumstances, the supply of information will be necessary. Local authorities and other organisations, as well as the Secretary of State, will need liasion on the subject of information. I hope that the liaison between the government departments such as the DHSS, the DoE and others is better than it has been up to now. I have found it difficult to get the same kind of information from two departments on the same issue. There is room for improvement.
Having said that, I think that there is nothing we can do about that matter at the moment. Therefore, turning to the other amendments to the regulations, I join with those who have welcomed the exemption of payments under the Macfarlane Trust. I congratulate the Government on their response to the concerns expressed on all sides of both Houses about the treatment of payments to haemophiliacs and the provision which the Government have made for them in the regulations. That is to be generally welcomed.
Concerning the other regulations before us, the Minister in another place described the housing benefit regulations as tidying-up regulations and said that they would deal with two minor matters. The Minister has this evening referred to minor matters to be dealt with by the regulations. Having read them and thought about them, I believe that it would be more accurate to say that they deal with major
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matters; namely, the miscalculation of the time required for implementation of the new scheme and a gross underestimation of the burden on local authorities in the timescale allowed and with the scarcity of finance for the task. Those are major matters.
Those of us who attend social security debates will recall the chaos that followed upon the introduction of the current housing benefit scheme in 1982–83. The first six months were plagued with problems of widespread delays in payments, errors in assessment, computer breakdowns leading to arrears and even some evictions of bewildered tenants. Local authority staff and voluntary organisations were confused and overstretched. Claimants were even more confused and ill-informed. That is relevant to our discussions tonight because we are now in almost the same situation.
So widespread were the delays and the misunderstandings on the first occasion that transitional arrangements had to be introduced twice to extend the implementation of the scheme, and the final date of transfer to the new scheme had to be deferred until December 1983—nearly 18 months after the passing of the Act. Now we are once again discussing transitional arrangements before a new scheme is implemented.
After the passing of that Act, some local authorities had still not been able to complete the necessary arrangements. There was a huge backlog of cases. We were all aware in our own local authorities of the number of cases which built up. There were literally millions of such cases which were left to be resolved. Some of them are not yet fully and satisfactorily resolved because of the delays. It was The Times which described the implementation as being the biggest administrative fiasco in the history of the welfare state. Now we have a new set of regulations.
It is also interesting to recall the reaction of the government spokesman at that time to the criticisms. The problems were described as teething difficulties. Perhaps that is the same as saying "minor problems". The Government said that the problems would disappear once the scheme had settled down and that there was nothing to worry about. The Secretary of State claimed at the time that out of 500 local authorities only 15 were experiencing difficulties in June 1983. A month later, he was forced to admit that 100 local authorities were still in trouble with the scheme. Now we are almost back in the same situation.
I have mentioned those matters because I think they are relevant. I believe that it does noble Lords good to draw parallels between the circumstances which existed then—we all objected in those debates—and the present circumstances. Remembering the introduction of these regulations outlining more transitional arrangements for local authorities which will not be able to implement them by the effective date, the remarks of the Minister in another place, the remarks of the Minister in this House which I mentioned a moment ago, the previous fiasco and this Government's record for ill thought out and panicky legislation on social security, to which we have all referred from time to

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time, I think that we on these Benches are entitled to be a hit sceptical about the almost complaisant approach that the Government are taking towards the regulations.
For a variety of reasons, mainly a shortage of staff and resources and difficulties with computer software, about 17 per cent. of local authorities will not be ready for the April deadline and may not even be ready for the deadline beyond April. That is not a minor affair. It is estimated that 1 million cases will be affected. There is nothing minor about 1 million cases when the hardship and deprivation caused by these problems is known. It is a serious problem.
Those delays cannot be attributed to local authorities. The very fact that the regulations are before us is an admission of the Government's failure to provide the extra funds and the extra time and to make provision in the legislation and in the regulations with which we dealt last November. The fact that these regulations had to come before us is an admission of failure on the part of the Government. They can no longer dodge the problem and leave it to local authorities. It is up to the Government to reimburse local authorities for the expenditure incurred as a result of this whole rushed exercise.
Local authorities have estimated expenditure of £46 million for the transition to the new scheme. The government grant will be about £25 million, which is just over half that figure. That is totally inadequate and does not take account of the extra burden that is being placed on the authorities by the transitional arrangements.
I know that my local authority is not the most popular in this House. It is popular to the extent that almost every noble Lord is an expert on Camden. More quotations are made about Camden on all kinds of issues than about any other local authority. Perhaps we should be glad that we are internationally famous and have been quoted on television thousands of times. Such references are never very complimentary.
I should like to congratulate Camden's housing benefits section on being one of the few that hopes to be ready. In fact Camden was one of the few that was ready for the last debacle in 1983. It is ready only because it was prepared. It knew of the difficulties that would be caused to ordinary tenants and other people if it was not ready. It has been prepared to feed in staff to work extra hours and overtime and to do the calculations by hand if the computer was not functioning or the software was not available. Camden has been doing just that up until now. It deserves credit for its efforts and some recompense, as do all the other local authorities that are perhaps doing the same, for the added expenditure incurred in trying to put right the Government's failure in this regard. I hope that the noble Lord will be able to give an assurance that the Government will look again at the expenditure being incurred by local authorities.
It is emerging already from information which I hope will be supplied to the Government that two out of every three claimants in Camden will lose money as a result of the new scheme. There is nothing minor about that. Nationally, the figures are quite horrific and frightening to anybody who really cares about the deprivation that will arise as a result of the losses
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under the new schemes. The article in The Times yesterday has already been mentioned. It says:
"More than four million people will have benefit payments cut in real terms because of social security reforms which start to come into effect on April 4, according to an analysis by independent researchers. The Policy Studies Institute, which has based its research on Department of Health and Social Security figures, also says that in spite of government claims that they will save nothing from the changes, the reforms will raise £545 million, mainly from cutting housing benefits. The losers, representing 48 per cent. of the 8·6 million claimants, include more than two million pensioners, 830,000 unemployed families and 73,000 working families. Many could lose up to £12 a week, the institute says".
This is the last chance we have before these regulations are implemented to remind ourselves and the Government of the position. I have three examples from Camden of how people will be affected. I could quote many more. They are typical of what will happen as a result of the implementation of the regulations. The first concerns a claimant, a lone, grandparent pensioner, who is bringing up her deceased daughter's child. Her total income is £98·22, made up of state pension, a small private pension and child benefit. Under the new calculations she will lose £13·08. No one in her circumstances can afford to lose £13·08.
The second example is a claimant who is a lone pensioner aged 77. She has a state pension of £41·15. She earns £17 a week from a part-time job. Under the new regulations she will lose £7·89 of the benefit that she has been receiving up until now. That is a large loss for a woman in her circumstances. The third example concerns a youngster. Young people and the very old have been attacked by almost everything the Government have done in social security. The examples I have given are typical of groups. There will be thousands like them in those groups.
The youngster is 18 years old and is in full-time work. Her take-home pay is £53·47. Her previous entitlement was £14 a week. Her entitlement under the new scheme is £1·48. She will lose £12·52 a week. Those are typical examples of three different groups of people who will lose as a result of the implementation of the new allowances and the housing benefits scheme.
There is no transitional arrangement for the housing benefit scheme. There is for the others—but not for housing benefits. I hope the Minister will be able to tell me that I am wrong, and that there will be. At the moment I understand that there is none.
I should like to ask the Minister for further clarification of the point that was raised by the noble Lord, Lord Kilmarnock. He asked about overpayment. The regulations which we debated last November—and they were also debated in another place—provided, as has always been the case, that local authorities could not recover an overpayment where it occurred through official error and where the claimant had no way of knowing that he or she had been overpaid. That had always been the position. However, it would appear that under the new regulations the local authority will have powers, even if it has committed an official error during the transitional period up to 30th June, to recover the overpayment from the claimants. The regulations give that power to the local authorities. Perhaps the Minister will clarify that point.

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Am I right in thinking that this is a departure from previous practice? What are the exact details? Does the Minister know how many tenants will be acquainted with that probability? How will they be acquainted with it and how will they check? Is it the department's intention to publish a book of guidance, instructions or information for the use of tenants so that they can check these matters, know the workings of the regulations and know how they are likely to be affected? If that is not done I do not see how thousands, perhaps millions, of people will know whether or not they have been overpaid or by how much. They may get into serious trouble if they carry on budgeting as they have been budgeting in regard to their previous allowances.
So I should like the Minister to give us further information on how tenants will be acquainted with these arrangements. I hope that he will not just say that it is up to the local authority, because it has already been demonstrated that local authorities cannot afford to do now the tasks which have been loaded on to them. It is up to the department to make some information available to the tenants.
Finally, much as I would have liked to vote against these regulations because, as I have said, in the main they are an attempt to put right the failures and miscalculations of the Government in the original Bill and the original regulations, we cannot do so tonight. But we on this side of the House are still opposed to the new scheme and the scheme which fathered this one. I certainly am still opposed to it, as I always have been. I am convinced that when the effects of this latest pernicious legislation become more widely apparent there will be many more demands for debate and further argument, especially when it becomes generally known that many of those millions of people who will be worse off are youngsters who are already struggling to exist on low wages; and that there will be many elderly people who have exercised thrift, and been encouraged by the Government to exercise thrift, who have prudently saved for their old age and who will now find that they will lose their entitlement entirely because of having a nest-egg put by for their retirement. I think that there will be demands from all quarters for more discussion on this question and I look forward to such a debate in the very near future.
8.15 p.m.
Lord Skelmersdale: My Lords, I am grateful to all noble Lords who have spoken on these five orders this evening. Perhaps I may say straight away how pleased we are to see the noble Lord, Lord Stallard, back in his place and obviously fighting fit.
To noble Lords generally I admit that the basis of these orders has been controversial in the past, and it is quite clear from today's short debate that it is still controversial. However, I submit that this matter has been thoroughly discussed in earlier debates, notably the debate that took place on what is now the Social Security Act 1986. I do not believe that these changes are pernicious, as the noble Lord, Lord Stallard, suggested. They follow an intention that has been set out ever since the publication of the Green Paper on this subject. There is an intentional targeting of the
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mammoth resources available. There is no hiding of skeletons in closets or anything like that about this matter.
I now turn to the individual points that have been raised during our discussion. The noble Lord, Lord Banks, asked me how many recipients of income-related benefits there will be once the reforms are introduced. That is a very good starting point for my response. Figures on the total number of benefit recipients must by definition be imprecise because of multiple receipt of a number of income-related benefits. There is no change in that under either the existing or future provisions. However, in broad terms we estimate that about 8 million people are presently in receipt of these benefits and that between 6½million and 7 million will be in receipt of benefits when the new system is fully implemented. A little later I shall explain why that is so.
The noble Lords, Lord Kilmarnock, Lord Banks and Lord Stallard, raised the question of an inadequate time for preparation, especially in regard to the new scheme of housing benefit. We made no secret about it. We always recognised and appreciated the heavy demands that the preparation for the changes placed on local authorities and DHSS local offices. Originally we intended to lay regulations before the House in mid-April last year, but as the House knows well, because we reported this matter to it, our legal advice was that we could not do so without including the final benefit rates. Obviously, that was not possible until the September retail prices index became available on 9th October. The moment that it became available we acted as quickly as we possibly could and as parliamentary time allowed. I do not believe that we were laggards in that respect.
The noble Baroness, Lady Jeger, and the noble Lord, Lord Banks, raised the question of the newly disabled who claim after April. I personally would have preferred to combine their disregard into the relevant orders that we are discussing this evening. Unfortunately, there just was not time because in the queue as it was the Macfarlane Trust came slightly earlier than the fund and regrettably there were drafting difficulties because of other legislation. Therefore it was impossible to combine the two for the order tonight.
I believe that our record for helping the sick and the disabled is very good indeed. Overall spending on benefits for the long-term sick and disabled under pension age now amounts to £6·75 billion a year, which is an increase of 80 per cent. over the lifetime of this Government. Under income support some 85 per cent. of the sick and disabled will gain or be unaffected by the reforms. As regards the question of when the provisions for the disregard of payments for the Independent Living Fund will come before your Lordships, I can say that we are in the process of determining the terms of that fund and the nomination of trustees. Once those matters have been completed we propose to bring the regulations before Parliament, which I hope will be in a matter of weeks.
The noble Baroness, Lady Jeger, raised another point on income support with special reference to water charges. The income support personal allowances take account of the supplementary benefit expenditure on water charges. However, I admit

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straight away that they are not separately identified—a point which alerted the noble Baroness. This change meets one of the aims of the reformed scheme; namely, to encourage self-reliance by providing a system of support which, so far as possible, leaves claimants free to manage their own financial affairs.
Several noble Lords have zeroed in on recent criticisms of the various reforms from very eminent bodies. The noble Baroness, Lady Jeger, mentioned the citizens' advice bureaux and another noble Lord, possibly the noble Lord, Lord Banks, mentioned the study by the Policy Studies Institute. I believe that there is a basic misunderstanding in the comments of all those eminent commentators. They have all underplayed the spending on transitional protection.
I point out straight away to the noble Lord, Lord Stallard, that there is no transitional protection for housing benefit because one of the objectives is to remove the payment of that benefit from people who have higher amounts of capital and to target it on those people who have lower amounts of capital. That ensures that under income support virtually all the present supplementary benefit claimants will receive just as much money as they do now. It is misleading to apply average single payments figures for all income support families with children in the way that the Policy Studies Institute has done, for example, since the available evidence suggests that two-thirds of such families do not receive such payments.
I also believe that it is misleading to use estimated single payments figures which predate the necessary changes made in 1986 and 1987. Noble Lords will remember a speech on this subject made by my noble friend Lady Faithfull at the Committee stage of the recent Social Security Bill. For the reasons given then by my noble friend it is particularly misleading to assume that any government would have allowed the growth in single payments prior to 1986 to continue unchecked.
I think that it was the noble Lord, Lord Kilmarnock, who commented that 15,000 part-time workers will lose their right to claim supplementary benefit or income support because of the 24-hour rule. I must confess that there are no official estimates of the numbers of people who may be working part time. The CAB figures therefore must rest on speculation. Almost nine out of 10 lone patents receiving benefit when the new income support scheme is introduced will have an increase or no change in their benefit income after they have paid their housing costs. For married couples the figure is 92 per cent.
Furthermore, the reforms help single parents to work by easing the amount that they can earn without affecting their income support payments from £12 a week up to £15 a week. While child care costs will no longer be specifically disregarded in this way, the evidence suggests that this helped only a minority of single parents on supplementary benefit. The higher £15 rule will help them all and for those working more than 24 hours a week the new, more generous, family credit will be available.
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The noble Lord, Lord Banks, returned to a subject that we have discussed over recent weeks; namely, the voluntary unemployment deduction period. I do not think that I can do better than to repeat what I said then. The extension keeps the deduction period in step with the period for which the claimant is disqualified for unemployment benefit, and for the same reason. It is not equitable to pay a person who has brought about his own unemployment the same as one who is unemployed for reasons beyond his control.
The consequence of the unemployment benefit disqualification period order being brought over into income support by extending the maximum period of voluntary unemployment deduction from 13 to 26 weeks is obviously pertinent to what I have just said. The 40 per cent. deduction from the personal rate of income support is a sanction that has existed for many years. It serves the same dual purpose of encouragement to act responsibly and a penalty for disqualification for unemployment benefit. If there are others in the claimant's household there is no reduction in benefit for them. The deduction applies only to the amount for the claimant. It is modified to a rate of 20 per cent. where there is a pregnant or seriously ill person in the family and the claimant's capital is not more than £200.
All noble Lords were concerned with the notification to claimants about these payments. The noble Lord, Lord Banks, was interested in overpayments especially, as I understand it, in the realm of housing benefit. Guidance is issued to all local authorities and that will ensure that if followed in at least 90 per cent. of the cases the money will not be overpaid. Those amounts that are overpaid will generally be small. Regulations ensure that claimants are notified at the time payments are made that they are payments on account and that an overpayment will be recovered and underpayments will be reimbursed.
The noble Lords, Lord Kilmarnock and Lord Stallard, raised the question of the money we have allocated to local authorities for setting up the new housing benefit scheme. The total sum of £25 million provides a very reasonable level of support when viewed in relation to local authorities' current administration costs and workload and compared with the total sum of £20 million spent on introducing the current scheme. Although we asked for it, there was no convincing evidence from local authorities' estimates of likely costs that the £25 million was inadequate. I am therefore rather surprised to hear the noble Lord, Lord Stallard, suggest at this late stage that it is inadequate. Estimates for items of expenditure such as staffing varied so widely that we concluded that some authorities had allowed a safe margin of error in their calculations. It was also clear that not all the costs envisaged by authorities were necessitated by the reforms.
We ought to remember that in 1983 the basis of the changes was slightly different from those that we are considering this evening. The objective then was to move payments from the department's local offices to local authorities. The noble Lords, Lord Banks and Lord Stallard, asked how many local authorities will not be able to implement the reformed housing benefit on 1st April. In other words, they picked up

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what I said earlier. I believe that the various press reports that the noble Lord, Lord Banks, quoted—reports that there will be chaos on 1st April—are totally inaccurate. In response to a questionnaire issued by my department, less than 10 per cent. have indicated that they will not implement fully on 1st April. Even this is a gross overestimate. My officials have visited authorities up and down the country and have not come across any, or indeed heard of any, who will not be in a position to pay benefit either under the new scheme or the arrangements debated tonight.
On the question of authorites not being given enough time to implement the scheme, I have already mentioned the consultations with local authority associations. I would add that these have been continuing for over 18 months. Authorities asked for a year to implement the new scheme. Draft regulations were issued to authorities in May 1987, only six weeks late. The next final regulations issued in November 1987 did not differ significantly from draft regulations issued in May. Those were the ones, as I have just told the House, that legal advice suggested would not be in a suitable and fair form to put before Parliament. Visits by senior officials have confirmed that the vast majority of local authorities are in a considerably better position than they were in 1983.
I should like to finish by commenting briefly on the housing benefit reforms and the capital rule. I know that this will be repetition but I have a few seconds left and I should like to make the comment for the benefit of those noble Lords both inside and outside the Chamber. We have changed the housing benefit capital rule because we want to be consistent across the three income-related benefits. The new cut-off point of £6,000 is double the current supplementary benefit limit of £3,000. Our policy is to give help to those most in need. Your Lordships may well be as amazed and as alarmed as I was to discover that at present one can be in receipt of housing benefit with £25,000 sitting in a current account. This cannot be right and indeed does not make sense. The better off should use their own resources before receiving help from public funds. That is exactly what public funds are for.
The new rule is beneficial for those with small savings because of the increase from the £3,000 limit to £6,000 limit. The only losers are those with large amounts. I do not believe that this is penalising thrift. We have sought to strike, and I believe have succeeded in striking, a careful balance between the need to ensure that money goes only to those who need it and the need not to penalise thrift. People do not have to spend all their capital before they become entitled to benefit. If people's savings dip below £6,000 they will become entitled to benefit, only providing that the money has not been used extravagantly but has been spent on reasonable day-to-day living expenses. It is ridiculous for the Opposition to talk about this Government penalising thrift. Under the last Labour Administration pensioners saw the value of their savings destroyed to a very large extent through inflation.
Staff in the department and local authorities have made tremendous efforts over the last two years to
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ensure that the benefits are successfully implemented. New computer systems have been developed. Detailed instructions have been prepared. Revised forms and leaflets have been printed and thousands of staff trained on the new systems. Advertising campaigns have been undertaken in regional and national press to draw attention to the income support and housing benefit changes. We have this week launched a major press and television campaign on family credit. That is the final point that I had not answered. On that basis, I commend en bloc the Motions standing in my name on the Order Paper.
On Question, Motions agreed to.

Copyright, Designs and Patents Bill [H.L.]
8.30 p.m.
Proceedings after Third Reading resumed.
Clause 176 [Duration of rights]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 132:
Page 76, line 39, leave out subsection (2).
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 177 [Transmission of rights]:
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 133 and 134:
Page 76, line 46, leave out ("expire") and insert ("are exercisable by his personal representatives.").
Page 77, line 10, at end insert—
("(5) Any damages recovered by personal representatives by virtue of this section in respect of an infringement after a person's death shall devolve as part of his estate as if the right of action had subsisted and been vested in him immediately before his death.").
The noble Lord said: My Lords, I have already spoken to these amendments. I beg to move.
On Question, amendments agreed to.
Clause 181 [Right to seize illicit recordings]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 135:
Page 77, line 42, leave out paragraph (b) and insert—
("(b) that at the time when any recording is seized the person by whom it is seized leaves at the place where it is seized a notice in the prescribed form containing the prescribed particulars as to the person by whom or on whose authority the seizure is made and the grounds on which it is made.").
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 183 [Forfeiture of illicit recordings]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 136:
Page 79, line 45, leave out ("district or").
The noble Lord said: My Lords, the noble Lord, Lord Williams of Elvel, moved an identical amendment at Committee stage in respect of what is now Clause 101, which is the corresponding clause in Part I. He said he had been advised by his noble friend Lord Morton of Shuna that the district court

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was not an appropriate place to deal with the matters in question. In that he was right, and I readily accepted his amendment. This amendment is necessary in Clause 183 for the same reason. I beg to move.
Lord Morton of Shuna: My Lords, it is very nice to come into the Chamber and be told that I was right. I thank the noble Lord for this amendment.
On Question, amendment agreed to.
Clause 193 [Expressions having same meaning as in copyright provisions]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 137:
Page 83, line 25, after ("delivery") insert ("up").
The noble Lord said: My Lords, in moving this amendment I speak also to Amendments Nos. 138 and 139. These are minor drafting improvements or corrections which do not involve matters of substance. The references to judicial and parliamentary proceedings in Clause 193 are not needed since these expressions are not used in Part II but only in Schedule 2 where the necessary references to meanings as in Part I appear in the appropriate paragraphs. The amendment to line 25 corrects a drafting error and makes Clause 193 consistent with Clause 194. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 138 and 139:
Page 83, leave out line 27.
Page 83, leave out line 29.
The noble Lord said: My Lords, I have spoken to these amendments. I beg to move.
On Question, amendments agreed to.
Clause 194 [Index of defined expressions]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 140:
Page 84, line 8, column 2, after ("193") insert ("(1)").
The noble Lord said: My Lords, with leave I shall speak also to Amendments Nos. 141, 142, 171, and 173. These are all concerned with minor improvements to the drafting to make the cross-references to the definitions of various terms a little more specific. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 141 and 142:
Page 84, line 9, column 2, after ("193") insert ("(1)").
Page 84, line 10, column 2, after ("193") insert ("(1)").
On Question, amendments agreed to.
Clause 195 [Design right]:
Lord Mottistone Lord Mottistone moved Amendment No. 143:
Page 84, line 38, at end insert ("or").
The noble Lord said: My Lords, I should like to speak also to Amendments Nos. 144 and 147, which are my amendments and which go together; and Amendments Nos. 175, 176 (which is my
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amendment) 179, 214, 216. 219 and 225. We have understood that the "must match" exception to protection for design right is intended to prevent the abuse of design right by motor car manufacturers in respect of spare parts for motor cars. It is largely in the area of motor car spares that controversy has arisen in the past in respect of the protection conferred on industrially applied design by copyright.
While I and the CBI do not agree that there has been an abuse of intellectual property rights, the CBI is of the opinion that if there is such a perceived abuse the exclusions from design right protection should be confined to those sectors of industry where the abuse occurs. This is most easily achieved by designating certain classes of article to which the must match exception should apply. The proposed amendments permit the Secretary of State to designate classes of article, for example, spare parts for motor vehicles, to which a must match exception applies.
The Secretary of State then has the ability to tailor the effect of design right protection so that any adverse effects on consumers are eliminated. Those sectors of industry which need design right protection to justify investment in good design can obtain that protection.
This is altogether a more flexible approach than a simple minded exclusion from protection determined by activities in a relatively small sector of British industry. For those reasons I seek to omit Clause 195(3)(c) and, in effect, to replace it by my new subsection, which is Amendment No. 147.
Amendment No. 176 applies the same subsection and the same principle to Clause 243, which are the amendments to the Registered Design Act. The other amendments in the name of my noble friend the Minister, Amendments Nos. 145, 175, 179, 214, 216, 219 and 225, do not appear to me to be linked to this in any way; but perhaps that is because I am dumb. It does not seem to me that I have any objection to them. They just look like tidying-up amendments, though no doubt we shall hear more about that from my noble friend the Minister. I beg to move Amendment No. 143.
Lord Lucas of Chilworth: My Lords, since I was involved in the earlier stage in this area of the Bill, I should take exception with my noble friend on this occasion in that his Amendments Nos. 143 and 144 take away the existing provisions which were a fundamental part of this part of the Bill. It leaves the equivalent of the provisions to the Secretary of State.
I suggest to the House that once the provision is removed, those opposed to that which the Bill as currently written provides for the motor industry will lobby to keep the industry out. We shall end up with a good deal more legislation; that is, representation to the Secretary of State. Under Amendment No. 147, when he makes his orders—these will presumably be by either negative or positive resolution of each House—we shall go through a long process. The injustice that currently applies will in effect continue for a long time to come. I hope therefore that my noble friend the Minister will resist my noble friend's set of amendments in this area and leave matters as they are in the Bill.

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It would be right and proper for me to correct something that I said on 1st March when we discussed this matter. I said on that occasion that the State Farm Insurance Company of America had a lawsuit against Ford in America. I owe an apology to the Ford Motor Company because the lawsuit is against the Volvo company. Nevertheless, the substance of the matter is precisely the same. It is to ensure that there is open competition in the spare parts and replacement panel industry. For those reasons I hope that what is in the Bill will be retained.
Lord Beaverbrook: My Lords, with the leave of the House I shall also speak to the grouping of amendments detailed by my noble friend Lord Mottistone. That includes Amendment No. 145 which appears on the groupings list but which my noble friend omitted to mention. All of these amendments concern the must-match exception. I should like to turn first to my noble friend Lord Mottistone's Amendments Nos. 143, 144, 147 and 176. He said these would limit the must-match exceptions to those sectors of industry where abuse has occurred. But the must-match exception is not intended to deal with abuses.
As I explained both in Committee and on Report, the must-match exception is intended to prevent monopolies arising in the first place, and to preserve the benefits of competition. Although design right is only a right to prevent copying, it is quite clear that in circumstances where a competitor has no choice but to copy if he is to produce a part which will match, then if there were no must-match exception he could be completely shut out of the market. This is not a question of abuse but of basic policy. And I have to say that this Government do not wish to create monopolies in this way in any sector of industry.
In this respect, a lot has been said about the design right proposals having been based on the needs of the motor industry. This is not the case. It is true that the problems of over-strong copyright protection first showed themselves in the motor industry, but the need to preserve competition is just as important in any sector of industry. And we should be quite clear about this: the absence of a must-match exception would enable competition in certain kinds of product to be totally frozen out. In our view that is not the way that the markets should operate. For that reason, I must say to my noble friend that I cannot accept his amendments.
I should like to turn now to Amendments Nos. 145, 175, 179, 214, 216, 219 and 225 all standing in my name. These amendments are intended to clarify the effect of the must-match exceptions to both design right and registered designs. They arise from concern which has been expressed in your Lordships' House and elsewhere that the must-match exception will effectively take away design protection in a wide range of cases where an independently designed item is subsequently used with other identical items in some larger article. It was never our intention that the must-match exception should apply in such cases. The question of whether the must-match exception applies is to be answered at the moment when the
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design is created, not at some later time. And the amendents are intended to put this beyond doubt.
For example, suppose that a new shape of an all-purpose strut is designed. If that is all that is designed, then it is quite clear that, at the moment of its creation, the shape or design of the strut is not dependent on anything else. In these circumstances the must-match exception should not apply because there is nothing to stop anyone else designing their own strut. In other words, there is no monopoly which needs to be avoided. Of course, the strut may subsequently be used by someone else, for example in a protective grille where there are a number of matching struts. At this point the shape of any one of the struts matches that of the others and any replacement would also need to match the others. However, in our view the must-match exception should not apply in these circumstances.
The uses to which an independently created design may subsequently be put should not affect the rights of the designer. In other words, those who design free standing things where there are alternatives should not be subjected to must-match, even where the design is subsequently used in a situation where the articles match other articles. This is the main thrust of the amendments but I should perhaps add that Amendments Nos. 179, 214, 219 and 225 are drafting amendments, consequential on the additional reference to "the author" of a design which would be introduced by Amendments Nos. 175 and 216.
For the reasons stated I must resist my noble friend's Amendment No. 143.
8.45 p.m.
Lord Mottistone: My Lords, I thank my noble friend for his careful explanation. I am sorry that he cannot go some way towards accepting my amendments. I feel sure that those who have advised me and the CBI will read what he has said with great care. I should not be surprised if this matter returned when the Bill goes to another place. However, at this stage I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 144 not moved.]
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 145:
Page 84, line 40, after ("intended") insert ("by the designer").
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 146:
Page 84, leave out line 42 and insert—
("(d) surface decoration.").
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
[Amendment No. 147 not moved.]
Clause 198 [Duration of design rights]:
Lord Mottistone Lord Mottistone moved Amendment No. 148:
Page 85, line 32, leave out from ("which") to ("an") in line 33.
The noble Lord said: My Lords, the amendment is proposed as a result of many other amendments to the clause in order to try to free it a little. In general an article would be made after the design, and this is an alternative way of extending the term. As at present drafted Clause 198 involves the use of three alternative tests to determine the period of protection provided by design rights: namely, 15 years from the end of the calendar year in which the design was first recorded; 15 years from the end of the calendar year in which an article was first made; and 10 years from the end of the calendar year in which an article was first marketed. Bearing in mind the difficulty of defining with any precision the term "marketing", the use of three alternative definitions is excessive. My amendment proposes to reduce the number to two.
In moving this amendment I am also speaking to Amendments Nos. 149 and 170 standing in my name. The latter amendment is intended to simplify the definition of the term "marketing". The definition of the term "design right" is simplified "to stop the clock running" —a phrase used by the Minister—before an article has even been designed (for example, the sale of an aircraft to an airline) and well before any real marketing takes place. I beg to move.
Lord Beaverbrook: My Lords, I should like to speak to Amendments Nos. 148, 149, 150, 151, 152 and 170. They cover the same point. Dealing first with my noble friend's Amendments Nos. 148 and 149, these would mean that the 15-year cut-off period would start only when the first article is made to the design. In the typical case of a design which starts life as a drawing and then progresses through a model and a prototype to the final article, the effect would be that the 15-year period would start when the model was made; that is, some time later than would be the case under the Bill as drafted.
But what of designs which remain on the drawing board? As long as no articles are made to the design, design right would continue to exist and that could go in perpetuity. We have set our face against perpetuity rights in the Bill with an exception for one special case. I do not believe that we should allow the possibility in design right. The incentive to bring designs to the market place would be reduced and potentially useful designs which could be exploited by others after the 15-year cut-off period could remain unused. For those reasons I must resist my noble friend's Amendments Nos. 148 and 149.
I should like to deal with Amendments Nos. 150, 151 and 152 standing in my name. They fulfil undertakings which I gave to come forward with amendments to ensure that the 10-year term of design right does not start to run until articles made to the design are in existence and are put on the market. The difficulty arises because as it stands at present, the Bill uses the concept of marketing to start the clock; and marketing includes offers to sell as well as sale itself. The result is that the 10-year clock would start when articles made to the design are offered for sale. This formula could start the clock before any articles were actually in existence, possibly even before a final design had crystallised.
The amendments on the other hand would start the clock when articles made to the design are first made available for sale or hire. It follows from this
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formulation that the countdown to the end of design right protection will not start until articles are in existence and are put on the market. In our view the term of design right should be 10 years in the real market and these amendments will achieve that aim.
Finally, I should say a few words about my noble friend's Amendment No. 170 which I think is directed towards a similar end. My noble friend's amendment would modify the general definition of marketing. However, we think that it is necessary to deal with the starting of the clock separately and to leave the general definition of marketing undisturbed. In any event, I hope that my noble friend will feel that my amendments adequately deal with the problem of starting the 10 year clock and that, as a result, he will not feel it necessary to move his own amendment.
Lord Mottistone: I thank my noble friend. I apologise for not referring to his amendments when moving my own. Those amendments go some way towards what we are talking about but not as far as my amendment or as far as one would have wished. However, it is a good move and no doubt that matter can be pursued later elsewhere. At this stage, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 149 not moved.]
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 150, 151 and 152:
Page 85, line 35, leave out ("marketed") and insert ("made available for sale or hire")
Page 85, line 37, leave out ("such articles were first marketed") and insert ("that first occurred")
Page 85, line 38, leave out subsection (2) and insert—
("(2) The reference in subsection (1) to articles being made available for sale or hire is to their being made so available anywhere in the world by or with the licence of the design right owner.")
The noble Lord said: My Lords, I have already spoken to these amendments. I beg to move.
On Question, amendments agreed to.
Clause 204 [Assignment and licences]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 153:
Page 87, line 45, leave out ("acts") and insert ("things")
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 208 [Primary infringement of design right]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 154:
Page 89, line 8, at end insert—
("(1 A) Reproduction of a design by making articles to the design means copying the design so as to produce articles exactly or substantially to that design, and references in this Part to making articles to a design shall be construed accordingly.")
The noble Lord said: My Lords, in moving Amendment No. 154, I shall also speak to Amendments Nos. 156, 157 and 174. They all concern the meaning of the word "reproduction". When we discussed this question in Committee, my

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noble friend Lord Campbell of Alloway expressed the fear that, as drafted, the restricted act of reproducing a design went too wide. My noble friend Lord Stockton and the noble Lord, Lord Lloyd of Kilgerran, expressed similar worries on Report. As a result, I undertook to look at the drafting and these amendments are the result of those deliberations.
The first worry that these amendments are intended to overcome is whether reproduction is limited to copying, or whether it goes wider than that and covers the independent creation of the same design. As I said in our earlier debates, the word "reproduction" appears in the existing copyright law and has always been taken to mean copying. However, the copyright provisions in Part I of the Bill use the term "copying" rather than "reproduction" and consequently there is a danger that if we do not do the same here in design right, the word "reproduction" in Part III might be taken to include reproduction by independent creation. Since it has always been our intention that design right should cover only actual copying, I am happy to put this beyond doubt.
The second worry that was raised concerned the question of how similar to the original a copy had to be before it would infringe design right. In our view, the right test is that a copy should be either exactly or substantially the same as the original, and that is what amendment No. 154 provides. Amendments Nos. 156 and 174 are consequential on Amendment No. 154.
Finally, I should say a few words about Amendment No. 157 which would delete paragraph (b) of Clause 208(3). As I explained in Committee, the purpose of this paragraph was to make it absolutely clear that if a person copies a design in the process of producing a derivative design, he infringes design right in the original design. The example I gave was a doll, the design of which had been copied and adapted to create a toothbrush holder based on the doll. The debates in your Lordships' House have however convinced us that this does not need saying. Furthemore, since it was clear in our debates that the paragraph was being taken to be a definition of the meaning of "reproduction", with the result that a reproduction could be very different from the original, we think that the best solution is to delete the paragraph altogether. I beg to move.
Lord Lloyd of Kilgerran: My Lords, I thank the Minister and his advisers for bringing forward these amendments having regard to what I said earlier in these proceedings.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 155:
Page 89, line 11, at end insert—
("(2A) Design right is also infringed by a person who without the licence of the design right owner does or authorises another to do either of the acts mentioned in subsection (1) in relation to a kit, that is, a complete or substantially complete set of components, intended to be assembled into such an article as is mentioned in that subsection.").
The noble Lord said: My Lords, I should like to speak to Amendments Nos. 158 and 159 which are all intended to meet a point made by my noble friend
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Lord Mottistone. During the debate on Report on the must-match exception to design right, my noble friend expressed concern that the must-match exception would seriously weaken the protection given by design right to articles which are made in two matching parts. The example he gave was of a vegetable dish where the lid must match the body, and the body must match the lid. His concern was that this would allow competitors to take unfair advantage by making and selling lids and bodies separately.
I should say that we do not share that fear: we do not believe that the courts would fail to stop people acting in this way because anyone who is making and selling lids and bodies in pairs is clearly making and selling complete vegetable dishes. In our view it is quite right that people should be stopped from acting in this way. However, that being the case, and given that we already have a kit provision for registered designs, we felt it would be right to include a kit provision for design right to remove any lingering doubts. I beg to move.
Lord Mottistone: My Lords, I am grateful to my noble friend for having met this point which I made at varying stages of the Bill. It goes some way towards meeting the objections we had to the Bill as cast. I thank him very much.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 156 and 157:
Page 89, leave out lines 12 and 13 and insert ("For the purposes of this section").
Page 89, leave out lines 17 and 18.
The noble Lord said: My Lords, I have already spoken to these amendments. I beg to move.
On Question, amendments agreed to.
Clause 209 [Secondary infringement: importing or dealing with infringing article]:
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 158 and 159:
Page 89, line 21, leave out ("also").
Page 89, line 28, at end insert—
("(1A) Design right is also infringed by a person who without the licence of the design right owner does any of the acts mentioned in subsection (1) in relation to a kit, that is, a complete or substantially complete set of components, intended to be assembled into such an article as is mentioned in that subsection.").
The noble Lord said: My Lords, I have already spoken to these amendments. I beg to move.
On Question, amendments agreed to.
Clause 212 [Right to delivery of infringing articles, &c.]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 160:
Page 90, line 27, after ("it") insert ("has been or").
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran moved Amendment No. 161:
After Clause 215. insert the following new clause:
("Compensation of employees fir certain designs.
Where it appears to the Registrar of Designs on an applicaton made by an employee that the employee has made a design belonging to the employer that the design is (having regard among other things to the size of the employer's undertaking) of outstanding benefit to the employer and that by reason of those facts it is just that the employee should be awarded compensation or award to be paid by the employer, the Registrar may award him such compensation or award as he thinks fit having regard to the nature of the employee's duties, his remuneration and the other advantages he derives or has derived from his employment, the effort and skill which the employee has devoted to making the design, the effort and skill which any other person has devoted in making the design jointly with the employee and the contribution made by the employer to the development and working of the design by the provision of advice and facilities.").
The noble Lord said: My Lords, this is an old friend and I am not proposing to weary your Lordships with all the arguments in favour of it. The theme is that any designer who makes a substantial design of outstanding benefit to his employer should receive some compensation. This amendment is along the same lines as an amendment introduced in the Patents Act 1977 during the passage of which I had considerable opportunity to bring forward that amendment, and I am trying to do the same with regard to design. The employee designer would be entitled to go to the Registrar of Designs and put his case and have the award made as the amendment states:
"having regard to the nature of the employee's duties, his remuneration and the other advantages he derives or has derived from his employment, the effort and skill which the employee has devoted to making the design, the effort and skill which any other person has devoted in making the design jointly with the employee and the contribution made by the employer".
This amendment had wide support from all sides of the House when I raised it before and I understood that the Minister was prepared to think again about it and on that assurance, I withdrew it. I beg to move.
9 p.m.
Lord Morton of Shuna: My Lords, I hope that the Minister and the Government are prepared to accept this amendment. The Minister has been extremely helpful on very many of the ideas that have been put forward from this side of the House. The noble Lord, Lord Lloyd of Kilgerran, was able to persuade a reasonable government in 1977 to adapt the Patents Act to his wishes and it would be nice if this Government, which we perhaps do not regard as quite as reasonable as the government of 1977, were to show that on this occasion we are wrong.
Lord Beaverbrook: My Lords, be that as it may, I am afraid that I am unable to be very helpful to the noble Lord tonight, but I assure him that we have given long and careful consideration to what he said previously.
As the noble Lord, Lord Lloyd of Kilgerran, has explained, these amendments concern remuneration for employee designs. When we debated two similar amendments which the noble Lord tabled on Report, I indicated that we were generally unsympathetic but that we would take the matter away and consider it. We have now given the matter careful consideration and I regret to tell the noble Lord that we do not
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believe it would be appropriate to do what he proposes.
As I indicated in the debate on Report, the main argument against the proposal of the noble Lord, Lord Kilgerran, is that it would impose a significant regulatory burden on industry. A firm wishing to check claims from employees would need to keep much more detailed records about who had designed what than they now do and would probably need entirely new accounting procedures to relate profitability to particular designs. There would also inevitably be time-consuming disputes about, say, the relative contributions of members of a design team, or the financial benefit deriving from a particular design. It is of course true to say that these problems also exist with the corresponding patent provision. But the difficulties there are much less extreme because there are very many fewer patents than designs. Moreover, patents have to be applied for in any event and therefore necessarily already require much of the record keeping which is required. Design right on the other hand is acquired automatically without any need to make an application and to add the burden of record keeping to keep track of employee designs would take away much of the advantage this gives, particularly to small firms.
In the light of all that, our view is that the noble Lord's amendment would place a significant regulatory burden on British industry which cannot be justified. For this reason I am unable to accept the amendment.
Lord Lloyd of Kilgerran: My Lords, that is a surprising answer to come from a Minister, in the context of social justice. It suggests that where a man creates a design and his firm might make millions out of it he cannot get some compensation. The position of a designer in a company is different from that of an inventor. A designer has little chance of promotion because of his specialist activities. To introduce what are merely procedural objections to what is, in my view, social justice in the context of industrial relations is surprising. The Minister and the Government will not be surprised when I suggest that this matter will be raised again in another place. In the circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 218 [Licences available in last five years of design right]:
[Amendment No. 162 not moved.]
Clause 221 [Crown use of designs]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 163:
Page 95, line 10, leave out from ("Crown") to end of line 31 and insert ("are to—

(a) the defence of the realm,

(b) foreign defence purposes, and

(c) health service purposes.

(3) The reference to the supply of articles for "foreign defence purposes" is to their supply—

(a) for the defence of a country outside the realm whose Government is party to an agreement with Her Majesty's Government in the United Kingdom in respect of defence matters: or

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(b) for use by armed forces operating in pursuance of a resolution of the United Nations or one of its organs.").

The noble Lord said: My Lords, in moving this amendment, I speak also to Amendments Nos. 164, 165 and 166 in the name of the noble Lord, Lord Lloyd of Kilgerran.
When the Crown use clauses were debated in Committee it was argued that the powers to be granted to the Crown were excessive. The powers in the clauses cover the purchase of equipment generally, not just defence equipment or equipment for the health service and I undertook to see whether this was too wide.
Having considered the point, we have concluded that the general power provided by the Bill is not in fact necessary. Accordingly, the amendment would provide a specific power limited to defence purposes and health service purposes only. However, I include foreign defence purposes in the definition of defence purposes, provided of course that there is an appropriate agreement or arrangement with the foreign government or governments—for example, NATO—or a resolution of the United Nations. The argument for extending powers to foreign defence purposes boils down to the fact that to a considerable extent there is no real difference between the categories of articles procured for UK defence purposes and those procured for foreign defence purposes.
Wherever possible equipment is standardised between ourselves and our allies—in NATO, the Commonwealth, or wherever—and all the parts have to be identical. Indeed, common stocks are often held and can be called upon in emergencies by our allies for use in their defence equipment. In these circumstances it would be impractical, even if it were not strictly impossible, to monitor which of our stocks were subject to design right and which were not. That is not to say that a careful check is not made on equipment exported—it is; but it would be intolerable for some parts to be exportable and some not. I am sure that the majority of manufacturers will understand this.
There is also a need for Crown use powers in the health service. If design right subsists in a surgical or a curative device or a prosthesis—for example, a hip replacement —and the owner of the design right insists upon unsatisfactory terms for supplying the item (for example, in price, quality or time of delivery) it is simply not practicable to redesign a substitute.
I appreciate that the question of powers in the health service is the subject of amendments in the name of the noble Lord, Lord Lloyd of Kilgerran. All I can say to the noble Lord on this matter is that we have considered it carefully and have concluded that the powers are necessary for the reasons I have given. In this respect, however, I should add that none of the remaining powers would be used without a very good reason.
Authorisations under this clause will certainly not be a standard contract condition in government contracts. They would not be used to legitimise a contractor who had deliberately infringed a design right held by a third party. Furthermore, the powers
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would only be used where design right owner abuses his rights and the Ministry of Defence has undertaken that only those officers who have authority to authenticate the Corporate Seal of the Secretary of State for Defence (that is, any Assistant Under-Secretary or above, or the Principal Directors of Contracts or Patents or the Directors of Contracts or Patents) will be given the authority to authorise use of the power given under these clauses. In the Department of Health and Social Security, an authorisation would only be given at a similar level. I am happy to put those assurances on the record.
It is, I hope, clear that we have gone a very considerable way towards meeting the concerns which have been expressed and I hope that these amendments, together with the assurances I have given, are acceptable. I beg to move.
The Lord Chancellor (Lord Mackay of Clashfern): My Lords, if this amendment is agreed to I cannot call Amendment No. 165.
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran moved, as an amendment to Amendment No. 163, Amendment No. 164:
Line 4, leave out ("and (c) health service purposes.").
The noble Lord said: My Lords, I am glad to see that the Government have moved away from the position that they tried to maintain with their extensive powers for Crown purposes. Of course, I am glad to hear the assurances which the noble Lord the Minister has given. As regards all these assurances, it seems to me that many of them could easily be put into the statute. Assurances of the kind he has given may be what this present government may adhere to, but we would like to see this embodied into statute. Therefore, I should like to press my amendment in regard to the deletion of paragraph (c)—that is, the deletion of health services—leaving the powers of the Crown to be exercisable in regard to the defence of the realm and for foreign defence purposes.
The noble Lord referred to certain designs of hip joints and other things. It may be difficult for those to be dealt with by some private firm and then for the Government suddenly to decide to plunge in in order in effect to take over those designs. I can conceive of instances of that happening. It seems to be contrary to the whole philosophy of the Government of using marketable forces to take that kind of action in relation to the design of any equipment in the health service. I beg to move.
Lord Mottistone: My Lords, I apologise to my noble and learned friend for interfering the last time. I very strongly agree with the noble Lord, Lord Lloyd of Kilgerran, in the remarks that he has just made. It is not good enough to have assurances to back up legislation. The amendments of themselves are not satisfactory to industry. The assurances as such will perhaps reassure them temporarily. The CBI had meetings with the Ministry of Defence not long ago and in between the two stages of the Bill. The CBI was given the understanding that there would be a much greater tightening of the powers of the Crown than is in fact the case with these amendments.
As regards the amendment taking out the health clause, it seems to me that that is something which

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ought to be supported. It is all very well talking about hip replacements and that kind of thing. There is an enormous amount of electronics used in medicine these days. It could well be that the very valuable software associated with medical matters would be in jeopardy if health is given the same kind of priority as defence. As the Ministry of Defence does not seem to think that defence requires this great support, it seems to me that we have not gone nearly far enough. This is not the time to try to change matters. I am quite sure that in another place this subject will be taken up again and it will be pressed with real vigour. It is a sad situation which is not satisfactory as yet.
Lord Morton of Shuna: My Lords, I do not know what has gone wrong today. I find myself supporting the Government rather too often for my own comfort.
It appears to me that it is necessary that health service purposes should be included. Health service purposes provide a situation where the Government as operators of that service are providing, in a monopolist way, health services for something approaching at least 95 per cent. of the health care in the country. If someone said, regarding a hip replacement that they wanted something and they would insist upon it, it would be entirely wrong for some grossly excessive payment to be allowed.
It is quite wrong to apply pure market forces. I am perfectly prepared to attack that as something which it is not right to apply in all circumstances to the health service. However, people like nurses and other workers in the health service are asked to comply with their social obligations.
If business has a patent or design right, or whatever, there should be a power on business to be forced to supply the goods at a reasonable cost. I understand that is the basic purpose behind the amendments. I oppose the amendment tabled by the noble Lord, Lord Lloyd of Kilgerran.
Lord Beaverbrook: The noble Lord, Lord Lloyd of Kilgerran has disputed that perhaps my assurances may not be effective in future years. I would not dispute that the assurances I have given about how the powers will be used are not legally binding in the same way that a statutory provision would be. We are reluctant to write equivalent restrictions into the Bill not least because they are extremely difficult, if not impossible, to frame in the precise way in which statutes are written. Furthermore, writing restrictions into the Bill could be unduly restrictive in that they would be set in concrete and could prevent changes being agreed in the way in which powers should be used in changing circumstances. For those reasons, I prefer not to write any further restrictions into the Bill.
My noble friend Lord Mottistone raised a point about the use of valuable software for health service purposes. Software is not covered by design right in Part III but by copyright in Part I where there are no crime use provisions.
My noble friend suggested that the amendments tabled in my name do not go as far as the Ministry of Defence agreed that they should. The amendments were drawn up in the closest possible consultation
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with the Ministry and in the light of the meeting to which my noble friend referred.
Lord Lloyd of Kilgerran: My Lords, I am grateful to the Minister for his reply. At this late stage of the Bill I shall not take up the cudgels with the noble Lord, Lord Morton of Shuna. I console myself with the fact that the Government have moved away from the position that they maintained some six weeks ago. I am grateful for the support given by the noble Lord, Lord Mottistone. I shall proceed as he intends to proceed and have the matter raised in another place. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 166 not moved.]
9.15 p.m.
Clause 233 [Reference of disputes relating to Crown use]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 167:
Page 101, line 2, leave out from ("referred") to end of line 3 and insert ("to the court by any party to the dispute").
The noble and learned Lord said: My Lords, in moving this amendment, I speak also to Amendments Nos. 168, 212, 213, 223 and 224. All are consequential upon the establishment of the patents county court jurisdiction. Part III of the Bill, Clause 223, design right, and the Registered Designs Act 1949, at present define the court for proceedings under them as the High Court in England and Wales. Without these amendments, notwithstanding the establishment of the new jurisdiction, the county court will be unable to hear disputes relating to the Crown use of a design and cases under the Registered Designs Act 1949. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 168:
Page 101, line 30, at end insert—
("(6) In this section "the court" means—

(a) in England and Wales, the High Court or a patents county court (see Part VI of this Act),

(b) in Scotland, the Court of Session, and

(c) in Northern Ireland, the High Court.").

The noble and learned Lord said: My Lords, I have spoken to the amendment. I beg to move.
On Question, amendment agreed to.
Clause 243 [Minor definitions]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 169:
Page 104, line 19, leave out ("employed") and insert ("employee").
The noble Lord said: My Lords, in moving the amendment, I shall speak also to Amendments Nos. 172, 178, 215, 218 and 226. The amendments make drafting changes relating to the use of the term "employment" and related expressions in Parts III and IV of the Bill. Clause 253, which contains minor definitions used in Part III, currently contains a reference to "employed", which should read "employee". Amendment No. 169 makes the necessary alteration. Amendment No. 172 would make the consequential change to the index in Clause

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244. Amendment No. 178 would bring the wording of Clause 247 into line with that used in Clauses 11 and 197.
Amendment No. 215 would provide definitions of "employee", "employment" and "employer" for the Registered Designs Act 1949 which, if your Lordships agree to Amendment No. 169, would be exactly the same as the definitions of these terms provided in Clause 243 for design right. Amendments Nos. 218 and 226 would make the necessary consequential changes to Schedule 4. I beg to move.
On Question, amendment agreed to.
[Amendment No. 170 not moved.]
Clause 244 [Index of defined expressions]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 171:
Page 104, line 45, column 2, at end insert ("(1)").
The noble Lord said: My Lords, I have already spoken to the amendment. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 172:
Page 105, line 2, column I. leave out ("employed") and insert ("employee").
The noble Lord said: My Lords, I have already spoken to the amendment. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 173:
Page 105, line 5 [numbered 4], column 2, at end insert ("(1)").
The noble Lord said: My Lords, I have already spoken to the amendment. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 174:
Page 105, line 10 [numbered 9], at end insert—
("making articles to a design section 208(1 A)").
The noble Lord said: My Lords, I have already spoken to the amendment. I beg to move.
On Question, amendment agreed to.
Clause 245 [Registrable designs]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 175:
Page 105, line 32 [numbered 31], after ("intended") insert ("by the author of the design").
The noble Lord said: My Lords, I have already spoken to the amendment. I beg to move.
On Question, amendment agreed to.
[Amendment No. 176 not moved.]
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 177:
Page 105, line 39 [numbered 38], leave out from ("article") to ("aesthetic") in line 40 [39] and insert ("if the appearance of the article is not material, that is, if').
The noble Lord said: My Lords, in moving the amendment I shall speak also to Amendment No. 217. When we discussed this part of Clause 245 on Report, a number of your Lordships criticised the drafting. These amendments are our attempt to clarify the wording. In this respect, I should perhaps say that the most important thing to note about the
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new Section 1(3) is that it is concerned with the aesthetic appearance of articles of the kind for which a design is to be registered, and not with the appearance of the design itself.
As I said on Report, the intention is not to deny registered design protection unreasonably but rather to restrict the Act to what we consider to be its proper field in a way which is clear. To this end the object of the provision is to deny registration in respect of articles whose aesthetic appearance is not something which matters to those who use the articles.
There are of course plenty of examples where the aesthetic appearance clearly matters; for example, furniture. And as I said on Report, if it is the case that the aesthetic appearance of farm tractors matters to farmers, or if the aesthetic appearance of scientific instruments matters to scientists, then aesthetic designs would be registrable for these articles. Even where this was not generally true, the final words of the new Section 1(3) will allow for the possibility that appearance would matter if the design in question were applied to the article. In other words, it would be possible to argue that although the appearance of those articles normally does not matter, applying the design to the article will change all that.
As to articles for which designs could not be registered, then I would suggest an ordinary wood screw as an example. Equally however there are plenty of wood screws with decorative heads whose aesthetic appearance clearly does matter to those who use them and the relevant designs would clearly be registrable. This is an important provision in the Bill and it is important that it is clear. In our view these amendments would result in drafting which is clearer. I beg to move.
On Question, amendment agreed to.
Clause 247 [Authorship and first ownership of designs]:
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 178 and 179:
Page 107, line 5, leave out ("a person") and insert ("an employee").
Page 107, line 8, leave out ("subsection (1)") and insert ("this Act").
The noble Lord said: My Lords, I have already spoken to these amendments and therefore I beg to move.
On Question, amendments agreed to.
Clause 248 [Right given by registration of design]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 180:
Page 107, line 36, leave out ("in the United Kingdom or elsewhere").
The noble Lord said: My Lords, with the leave of the House, in moving the amendment, I shall also speak to Amendments Nos. 181, 182, 220, 221 and 222. The amendments all concern the infringing act of making tools for enabling infringing articles to be made. Amendments Nos. 180, 181, 220 and 221 correct an error in the drafting.
The infringing act—in this case the making of tools —is necessarily only caught when it is done in the United Kingdom, so the present reference to the United Kingdom in subsection 3 of the new Section 7 is superfluous and the reference to "elsewhere" is

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wrong. However, we do not believe that it should matter where the tools are used to make articles and consequently a reference to "the United Kingdom or elsewhere" is needed later in subsection 3 after the word "made".
Having corrected that defect, we now come to Amendments Nos. 182 and 222. They would make it an infringing act to make tools for enabling the making of kits of parts, as well as the making of complete articles. As presently provided, it is an infringement to make and to trade in infringing articles and kits of parts intended to be assembled into infringing articles. It therefore seems anomalous that the making of tools should be an infringement only in relation to the making of complete, infringing articles and not in relation to kits of parts. Amendments Nos. 182 and 222 would remove that anomaly. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 181 and 182:
Page 107, line 37, after ("made") insert ("in the United Kingdom or elsewhere").
Page 107, line 42, after ("0 1") insert ("or (3)").
The noble Lord said: My Lords, I have already spoken to the amendments and therefore I beg to move.
On Question, amendments agreed to.
Clause 254 [Persons entitled to describe themselves as patent agents]:
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran moved Amendment No. 183:
Page 109, line 39, leave out ("or "patent attorney" ").
The noble Lord said: My Lords, while moving this amendment, with leave of the House, I should also like to speak to Amendments Nos. 184, 185, 186, 188 and 189. As the Minister is well aware, strong representations have been made to him by eminent solicitors and by the Law Society—I have seen much of the correspondence—saying that it is quite improper and causes confusion to designate a patent agent as a patent attorney.
The word "attorney" associated with a registered patent agent, I am instructed, causes considerable confusion. I am not sure why registered patent agents would want to use the word "attorney" in that context. They have the opportunity to use the name "European patent attorney" in the context of their international obligations. I beg to move that the words "patent attorney" be eliminated.
Lord Beaverbrook: My Lords, with the leave of your Lordships, I shall speak also to the amendments quoted by the noble Lord.
Similar amendments were moved in Committee, and my noble friend Lord Dundee indicated at that time that we would look again at the question of the references to "patent attorney" in the Bill.
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This is rather a difficult issue, but the fundamental point on which it turns is Section 21 of the Solicitors Act 1974. This provides that it is an offence for any unqualified person to use a title which implies that he is qualified to act as a solicitor. The Law Society contends that the use of the title "attorney" by a person who is not a qualified lawyer would contravene that section.
The Government are content to leave that question of interpretation to the courts, and I am not going to comment on it here. However, I should like to point out that while the Bill incorporates a saving to the effect that the use of "European patent attorney" by persons on the European list does not contravene Section 21 of the Solicitors Act, there is no such saving in respect of the use of the words "patent attorney" alone. It therefore follows that nothing in this part of the Bill affects any restrictions which may currently exist on the use of "patent attorney".
Clause 254 does not give any person permission to use the title "patent attorney"; it merely states that certain persons may not use the title. This may seem a little odd, but we consider it necessary for the following reasons.
In future, unqualified persons will be able to offer patent agency services. Because under the Bill, such persons will still not be free to call themselves "patent agents", they will need to adopt some other title, and "patent attorney" would be one obvious possibility. However, we believe that the use of the title "patent attorney" by persons who are not registered patent agents should not be allowed. I emphasise that this does not mean that we want to encourage the use of "patent attorney" by patent agents; it is simply a reflection of our belief that these words would in fact convey to the public the impression that the person using them is a qualified patent agent. This has come about principally through the legitimate use of "European patent attorney" by patent agents entitled to appear before the European Patent Office. I am sure that your Lordships would agree, therefore, that to permit the use of "patent attorney" by persons who are not registered patent agents would be undesirable. The references to "patent attorney" in Clause 254 are included to ensure that, whatever the position under the Solicitors Act, such persons are prohibited from using the title.
I shall just add at this point, because Clause 254 is structured so as to prohibit certain persons using the title "patent attorney" rather than positively to permit anyone to use it, the amendments proposed by the noble Lord, Lord Lloyd, would not have the effect of removing any entitlement of registered patent agents to use the title. The Bill as presently drafted gives them no such entitlement. The amendments would merely remove from the Bill any prohibition on persons not registered as patent agents from using the title, leaving this matter to be determined for them, as well as for registered patent agents, by Section 21 of the Solicitors Act.
For those reasons, I would have to resist the noble Lord's amendments.
Lord Lloyd of Kilgerran: My Lords, I am grateful to the noble Lord for what he has said. I am sure that noble Lords will agree with me that it would be

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brave—indeed foolish—for me to take up the cudgels with him on behalf of the Law Society, or eminent solicitors, in the presence of the noble and learned Lord the Lord Advocate and the noble and learned
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Lord who sits on the Woolsack. In those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 184 to 186 not moved.]
9.30 p.m.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 187:
Page 110, line 3, leave out ("attornies") and insert ("attorneys").
The noble Lord said: My Lords, with the leave of your Lordships, in moving this amendment I shall speak also to Amendment No. 190. These amendments correct the spelling of the word "attorneys". My noble friend Lord Stockton moved a similar amendment on Report, and your Lordships may recall that I resisted it on the grounds that the spelling used in the Bill was correct. I have to say that I was wrong and that my noble friend was right. However, we have bought a new dictionary, we have a new person to read it and I hope that in future we will at least get our spelling right. I beg to move.
The Earl of Stockton: My Lords, I am grateful to the Minister. I should hate to think that a pair of "i's" could come between us and I am happy that he has shown himself to have the wisdom of the "y's".
Lord Mottistone: My Lords, has my noble friend noted that, as regards the title of Clause 255. the word "attorneys" is also spelt incorrectly in the margin?
Lord Beaverbrook: My Lords, no.
Lord Mottistone: My Lords, perhaps that should be corrected as well.
On Question, amendment agreed to.
[Amendments Nos. 188 and 189 not moved]:
Clause 255: [Persons entitled to describe themselves as European patent attornies, &c.]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 190:
Page 110, line 42. leave out ("attornies") and insert ("attorneys").
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 191:
Page III, line 9, at end insert—
("(5) A person whose name appears on the European list is not guilty of an offence under section 21 of the Solicitors Act 1974 or Article 22 of the Solicitors (Northern Ireland) Order 1976 by reason only of describing himself as a European patent attorney.").
The noble and learned Lord said: My Lords, in moving Amendment No. 191, with the leave of your Lordships I shall also speak to Amendments Nos. 193, 194 and 230. The purpose of most of these amendments is to group existing provisions relating to patent agents in a single schedule to the Bill. I do not expect that your Lordships would wish me to trouble you with the detail of that reorganisation.
The new Section 102A confirms the decision of the High Court in Reiss Engineering Company v. Harris. There the court held that Section 102(3) of the Patents Act 1977 permits patent agents and non-practising barristers to conduct all stages of litigation when appearing for a client on an appeal from the comptroller.
In order to put the matter beyond doubt, this amendment confirms that decision. It does not create any new right of audience. The new subsection (2) in Clause 267 provides a power to regulate the conduct of a patent agent before the patents county court. The new Section 102A(3) provides for a similar regulatory power in the patents court. Patent agents are a well-disciplined profession and I see the existence of these powers only as a longstop which I hope it will never he necessary to use.
I have for a moment passed over the amendment creating the new Section 99A to the Patents Act 1977. This amendment gives the patents court a power similar to that given to the patents county court in Amendment No. 201, to order a Patent Office report. It gives the patent court a power which otherwise only the patents county court would have had. I beg to move.
Lord Williams of Elvel: My Lords, if I may say so, the noble and learned Lord skated through the reasons for moving this amendment and I am perfectly happy to accept his word. As a complete layman in the business, perhaps I may ask the noble and learned Lord where, as a businessman, I find the European list. Is that something to which the noble and learned Lord could respond?
The Lord Chancellor: My Lords, I regret that I cannot give the precise location of the European list at the moment. I think there are copies of it in a number of places and perhaps the noble Lord would allow me to write to him on the point.
On Question, amendment agreed to.
Clause 257 [Privilege 16r communication for patent agents]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 192:
Page 112, line 10, leave out ("does not include criminal proceedings but").
The noble Lord said: My Lords, with the leave of your Lordships, in moving this amendment I shall speak also to Amendment No. 195. At the Report stage my noble friend Lord Mottistone tabled amendments to these clauses which sought to bring criminal proceedings within the classes of proceedings in which communications with qualified patent agents and trade mark agents would be privileged.
In speaking to these amendments my noble friends Lord Mottistone and Lord Jenkin of Roding both made the point that advice given by patent agents may be equally germane to civil and criminal proceedings, and that there is no clear justification for making a distinction between them for the purposes of privileged communications. I expressed some sympathy with this view and said that we would look again at the question. Having done so we have come to the conclusion that the reference to criminal proceedings in both Clauses 257 and 263 should be deleted so that privileges for communications with qualified patent agents and trade mark agents will extend to all legal proceedings. I beg to move Amendment No. 192.
Lord Mottistone: My Lords, I want very much to thank my noble friend for taking this up and moving the amendments.
Lord Williams of Elvel: My Lords, I am sure that the amendment is correct in what it seeks to do. The support of the noble Lord, Lord Mottistone, is right. As a layman I am always concerned about the extension of legal privilege. I wonder whether this formulation is really right. Are we to understand from the amendment that if there is a communication between a client and a patent agent which involves a Guinness-type situation, if I may put it like that, that communication if the amendment is accepted is now privileged? In other words, if there is a DTI inquiry ino a Guinness-type situation a patent agent can plead that he cannot give evidence to DTI inspectors. I think everyone understands what I mean by a Guinness-type situation. Is that what the amendment if passed would mean?
Lord Beaverbrook: My Lords, I believe that the powers of inspectors are covered under other legislation. In the example mentioned by the noble Lord —I do not want to get involved in particular cases—it would depend perhaps on whether criminal proceedings had been commenced.
The noble Lord will be well aware that very often where inspectors are appointed there is no question of criminal proceedings being commenced at that time. I suspect that it would vary very much from case to case. However, I would say that the privilege is limited to patent and similar proceedings and that the example given is unlikely to fall into such a category.
On Question, amendment agreed to.
Clause 259 [Right of audience in patent proceedings]:
The Lord Chancellor The Lord Chancellor moved Amendments No. 193:
Leave out Clause 259.
On Question, amendment agreed to.
Clause 260 [Effect of enactments relating to preparation of documents, &c.]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 194:
Leave out Clause 260.
On Question, amendment agreed to.
Clause 263 [Privilege for communications with registered trade mark agents]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 195:
Page 115, line 6, leave out ("does not include criminal proceedings but").
The noble Lord said: My Lords, I have just spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 266 [Patents county courts to exercise special jurisdiction]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 196:
Leave out Clause 266 and insert the following new clause:
("Patents county courts: special jurisdiction.
.—(1) The Lord Chancellor may by order made by statutory instrument designate any county court as a patents county court
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and confer on it jurisdiction (its "special jurisdiction") to hear and determine such descriptions of proceedings relating to patents and designs as may be specified in the order.
(2) The special jurisdiction of a patents county court is exercisable throughout England and Wales, but rules of court may provide for a matter pending in one such court to be heard and determined in another or partly in that and partly in another.
(3) A patents county court may entertain proceedings within its special jurisdiction notwithstanding that no pecuniary remedy is sought.
(4) An order under this section providing for the discontinuance of any of the special jurisdiction of a patents county court may make provision as to proceedings pending in the court when the order comes into operation.
(5) Nothing in this section shall be construed as affecting the ordinary jurisdiction of a county court.").
The noble and learned Lord said: My Lords, Clauses 266 and 267 which I am moving to delete from the Bill were marker clauses to cover the detail proposed for the patents county court. I mentioned to your Lordships on Report that the precise shape of Clause 266 was likely to change. This is the new shape of it.
I originally intended to create this new jurisdiction by adding new sections to the County Courts Act 1984. Having considered the matter and with advice, I now consider that it would be better if the more direct approach of the clauses forming part of this Bill were adopted. The new jurisdiction will therefore be created by analogy with that of divorce county courts which have national jurisdiction, rather than following the original pattern of admiralty jurisdiction which is exercised locally by combining county court districts.
This clause repeats, for the most part, those provisions which were contained in the new Section 31A of the County Courts Act.
The first subsection (identical in principle to that in Clause 266) enables one or more county courts to be appointed by statutory instrument to hear such descriptions of proceedings relating to patents and designs as may be prescribed. There has been one significant amendment to the scope of the jurisdiction order. At Committee the noble Lord, Lord Lloyd of Kilgerran, raised doubts about the desirability of including the words
"or other intellectual property and related matters"
in the new Section 31A(2)(a).
I undertook then to look again at the noble Lord's point and I have now done so, concluding that they gave an unintended breadth to the power to confer jurisdiction by referring to the words "or other intellectual property". However, I believe that it may be wise to retain the phrase "and related matters". Although they do not appear in this particular amendment, that matter may well be raised in another place. The principal purpose of the amendment is to give effect to the point which the noble Lord, Lord Lloyd, raised.
The second subsection represents a slight change from the previous provision, since it refers to an England and Wales jurisdiction rather than one defined by county court districts. In fact, since only one court will be designated, at least at the outset, this represents no change in practice. It may also be simpler as a matter of drafting. Historically, the county court's jurisdiction has been exercised primarily with regard to monetary claims of one kind

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or another. The range of remedies in patents and design proceedings is liable to be much wider than in ordinary civil proceedings and may be unaccompanied by any financial claim.
The third subsection makes it clear that the county court will have power to grant an injunction or order for delivery up, for example, although no financial claim is made. The fourth subsection allows for transitional arrangements covering proceedings pending in the event of any part of the special jurisdiction being discontinued. This subsection repeats the provision presently in the new Section 31A(4) of the County Courts Act. There is no change of substance proposed.
The fifth subsection separates the new jurisdiction from that of the county court at present. This will leave untouched in the ordinary county court any contractual disputes relating to patents which are presently dealt with there. There is no change here from the provision in the new Section 31A(5). I beg to move.
Lord Williams of Elvel: My Lords, my noble friend Lord Morton of Shuna raised certain points at the Committee stage of the Bill as regards the clauses and in particular the question of finding the right people to perform, if I may use that expression, in those courts. Having agreed at Committee stage to take the point on board and consider it, perhaps the noble and learned Lord will be able to give us a response on that matter.
My noble friend also raised the question of whether the patents county court, designated by order of the Lord Chancellor in the new amendment, has any specific and particular status as opposed to any other county court or whether it has to change its actors, as it were, when it becomes a patents county court. Perhaps the noble and learned Lord can comment on those two points.
Lord Lloyd of Kilgerran: My Lords, I thank the noble and learned Lord on the Woolsack for his reference to what I said concerning the breadth of one of the clauses. I am still unhappy that the words "or related matters" are included in the amendment. I am not sure what that means.
The Lord Chancellor: They are not in the amendment.
Lord Lloyd of Kilgerran: My Lords, I am grateful to the noble and learned Lord. I misunderstood him. Perhaps I may briefly call attention to subsection (1) in Amendment No. 197. It is stated that somehow or other limits should be provided for the amount or value in relation to any description of proceedings within the special jurisdiction of patents county courts. The assessment of limits of amount or value in relation to patents actions is extremely difficult. Frequently, when patent actions are started, one does not know what the patent will be worth. The value of the patent is not really determined until after proceedings have come to an end. I therefore wonder whether, in subsection (2)—
Lord Williams of Elvel: My Lords, I apologise. Is the noble Lord speaking to Amendment No. 196 or
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Amendment No. 197? I understood that the noble and learned Lord had not spoken to Amendment No. 197.
Lord Lloyd of Kilgerran: My Lords, I am very sorry to have caused confusion.
The Lord Chancellor: My Lords, the two amendments are closely related. However, I moved Amendment No. 196. We shall come to Amendment No. 197 in due course. The noble Lord, Lord Williams of Elvel, asked two questions about Amendment No. 196. He asked whether the Lord Chancellor will be able to find or nominate the right person to be a judge of this court. I do not doubt that that will be a difficult operation and one that will not be contemplated until, first, the primary legislation is in place and, secondly, an order under it is made. It will be quite difficult to find the right person but I believe that it will be possible.
The noble Lord asked whether the people who are in the county court for other purposes will be able to function in the patents county court. The answer is yes. The patents county court will be a county court. The difference between the patents court and other county courts relates to jurisdiction. The patents court will be special in its jurisdiction but that does not preclude officers being officers both of the patents county court and of another court. Whether that would necessarily be the right thing to do is a matter that would fall to be determined in detail when the precise arrangements were made.
The noble Lord, Lord Lloyd of Kilgerran, asked about Amendment No. 196. The amendment as proposed restricts the descriptions of proceedings to those relating to patents and designs and does not include the words "and related matters". I mentioned that I am still doubtful whether it ought to include "and related matters'. The noble Lord is rather against that, and it may be that his view should prevail. When one says "relating to patents and designs", that may be slightly narrow to cover all the types of action that may arise out of a patent or design. Certainly, I intend to look into that matter further as the Bill goes to another place. I beg to move.
On Question, amendment agreed to.
9.45 p.m.
The Lord Chancellor The Lord Chancellor moved Amendment No. 197:
After Clause 266. insert the following new clause:
("Financial limits in relation to proceedings within special jurisdiction of patents county court.
.—(1) Her Majesty may by Order in Council provide for limits of amount or value in relation to any description of proceedings within the special jurisdiction of a patents county court.
(2) If a limit is imposed on the amount of a claim of any description and the plaintiff has a cause of action for more than that amount, he may abandon the excess; in which case a patents county court shall have jurisdiction to hear and determine the action, but the plaintiff may not recover more than that amount.
(3) Where the court has jurisdiction to hear and determine an action by virtue of subsection (2), the judgment of the court in the action is in full discharge of all demands in respect of the cause of action, and entry of the judgment shall be made accordingly.
(4) If the parties agree, by a memorandum signed by them or by their respective solicitors or other agents, that a patents county court shall have jurisdiction in any proceedings, that court shall have

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jurisdiction to hear and detemine the proceedings notwithstanding any limit imposed under this section.
(5) No recommendation shall be made to Her Majesty to make an Order under this section unless a draft of the Order has been laid before and approved by a resolution of each House of Parliament.")
The noble and learned Lord said: My Lords, this clause introduces a number of procedural provisions for the patents county court. The order-making power to set a limit of amount in relation to any proceedings within the patents county court jurisdiction was originally contained in the new Section 31B of the County Courts Act in Clause 266 and is repeated here. So as not to confine the power to limit jurisdiction to money claims, the clause has been extended to limits of "amount and value". It could now, for instance, be applied to the value of a patent in a case where injunctive relief alone is sought. It remains to be seen, however, whether this is a desirable thing to do. What we are doing here is providing the necessary power.
The second and third subsections repeat the provisions of Section 17 of the County Courts Act. They allow a litigant to limit the amount of his claim so that his case can be heard in the patents county court. The fourth subsection allows the parties by agreement to waive the financial limit.
Perhaps I may take this opportunity to answer the question raised, a little prematurely, by the noble Lord, Lord Lloyd of Kilgerran. It is true that the amount involved in a claim may be difficult to estimate at the outset. On the other hand, one may have some idea of it. The powers in subsection (2) allow one, even if one thinks that the true value of the claim may be more than the jurisdiction limit, to go ahead so long as one is prepared to limit the amount for which judgment is sought to the amount for which the limit is set. The idea is to provide a machinery for limiting the size of matters that may be litigated in the patents county court. It follows the provisions to which I have referred, and while this is primary legislation. I think it is right to take this power. Precisely how it may be exercised may be a matter of detail to be considered later on. With those explanations I beg to move.
Lord Lloyd of Kilgerran: My Lords, I am grateful to the noble and learned Lord for his explanation of the matters that I raised rather in advance of my time. If I may say so, the noble and learned Lord has been going rather fast this evening but I never thought that I should be ahead of him by one clause at any stage in the proceedings. I should like to thank him very much indeed for the explanation that he has given.
Lord Morton of Shuna: My Lords, the position of a Scottish lawyer who talks about the patents county court is rather strange and I am very diffident about speaking. It appears to me that perhaps this provision misses the real opportunity that may have occurred in this legislation to make a material change in the procedure of the patents county court. I am referring to the opportunity to change the function of the judge from supervising in the way to which one is accustomed, that is to say a kind of adversarial system, to undertaking what is far more of an inquisitorial role, in which he would say, "This is a
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simple point which should be dealt with by the county court even if its value is so much", or "This is a difficult problem and it should be dealt with by the High Court, even though its value is less than so much".
That is the real point at which one should be looking in this type of provision because if a person of small means is claiming a patent and a very large company with vast financial resources is asserting its rights, so far as I can see that company can almost force the case into the more expensive court, when in fact the point to be decided may be a fairly simple one and suitable for the county court.
I am sorry therefore that the provisions do not appear to go very far towards giving the judge the power to say, "This is suitable for court A and that is suitable for court B", which would be possible if the judge were given far more inquisitorial powers.
The Lord Chancellor: My Lords, it seems to be my lot tonight to be one step behind. I think that the point raised by the noble Lord, Lord Morton of Shuna, is at least to some extent covered by Amendment No. 198 which I propose to move in a moment. However fast I go, I cannot catch them up.
The question of the inquisitorial nature of the proceedings to some extent is answered by the power to obtain a report which is given in relation, first, to the patents county court and then to the High Court itself, so that the judge will have a right to obtain a report which can affect the course of proceedings. Of course there will be scope for procedural rules for the patents county court which may further assist the matter upon which the noble Lord has commented. So, with respect. I do not think that any opportunity has been lost in the way that he suggested. I believe that, should it be thought right, all the matters that the noble Lord has mentioned can be encompassed under the primary legislative provisions that we are proposing.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 198:
After Clause 266, insert the following new clause:
("Transfer of proceedings between High Court and patents county court.
.—(1) No order shall be made under section 41 of the County Courts Act 1984 (power of High Court to order proceedings to be transferred from the county court) in respect of proceedings within the special jurisdiction of a patents county court.
(2) In considering in relation to proceedings within the special jurisdiction of a patents county court whether an order should be made under section 40 or 42 of the County Courts Act 1984 (transfer of proceedings from or to the High Court), the court shall have regard to the financial position of the parties and may order the transfer of the proceedings to a patents county court or, as the case may be, refrain from ordering their transfer to the High Court notwithstanding that the proceedings are likely to raise an important question of fact or law.")
The noble and learned Lord said: My Lords, this new clause is a necessary procedural amendment to facilitate the work of the patents county court and ensure that the criteria for transfer used in relation to current county court business are suitably adapted to cover the new jurisdiction. It is an important consequence of our aim of keeping costs down in patent proceedings that there should be as few obstacles as possible in the way of transferring cases

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down to the patents county court. The power contained in Section 41 of the County Courts Act 1984 allowing the High Court to order proceedings to be transferred out of the county court will, therefore, by virtue of subsection (1), not apply to proceedings within the patents county court's special jurisdiction. In doing this we accept the recommendation of the committee on patent litigation that the scope of intervention by the patent court in the day-to-day management of the patents county court's business should be restricted.
Subsection (2) qualifies, for proceedings within the special jurisdiction, the considerations relevant to whether an order should be made under Section 40 or 42 of the County Courts Act, which govern the transfer of proceedings from, or to, the High Court. In considering whether an order is made the financial position of the parties shall be a major consideration, notwithstanding that the case is likely to raise an important question of fact or law.
The purpose of this amendment is twofold: to ensure that the small litigant, with limited financial resources, is not deterred from bringing his case in the patents county court by the prospect that it might be transferred to the patent court, and to ensure that the small litigant in the patent court is not financially penalised by being forced to continue his case there. The court will have a choice in the matter, and financial considerations will not necessarily outweigh the importance of any question of fact or law raised by the case.
I should add that this is not a wholly new provision. By virtue of Section 106(1) of the Patents Act 1977 the court, in considering the compensation of an employee for certain inventions, and in determining whether, and what, costs and expenses shall be awarded to any party, shall have regard to all the relevant circumstances, including the financial position of the parties.
The transfer provisions will as a whole place a not inconsiderable responsibility on the judiciary. If the patents county court proposals are to be effective, small litigants must have confidence that they can have access to affordable proceedings notwithstanding the weight and complexity of their case. I am confident that the judges of the patent court and the judges of the patents county court when appointed will exercise this provision firmly and with regard to the vital need to reduce cost and improve access to the courts.
This squarely deals with the point that the noble Lord, Lord Morton of Shuna, was raising a few minutes ago. Putting the financial position of the parties in the forefront of this provision deals with it as effectively as can be done. I beg to move.
Lord Morton of Shuna: My Lords, like the noble Lord, Lord Lloyd of Kilgerran, I apologise for getting ahead of the noble and learned Lord the Lord Chancellor. It is an unusual circumstance. Although this provision deals with the financial position of the parties—I accept that, and it is very valuable—it does not deal with patent litigation which, although fairly major, is fairly simple and should be able to be forced—whatever the financial position of the parties—into the county court if the judge thinks that that is the
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appropriate court. I am suggesting that the inquisitorial powers, of which I am in favour, and which are the custom in Europe, could be extended further.
Lord Lloyd of Kilgerran: My Lords, I thank the noble and learned Lord for his explanation of the procedures which provide a very valuable measure for reducing the costs of litigation for small business firms. I should like to express very humbly my appreciation of the explanation that he gave of Amendment No. 198.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 199:
After Clause 266, insert the following new clause:
("Limitation of costs where pecuniary claim could hare been brought in patents county court.
.—(1) Where an action is commenced in the High Court which could have been commenced in a patents county court and in which a claim for a pecuniary remedy is made, then, subject to the provisions of this section, if the plaintiff recovers less than the prescribed amount, he is not entitled to recover any more costs than those to which he would have been entitled if the action had been brought in the county court.
(2) For this purpose a plaintiff shall be treated as recovering the full amount recoverable in respect of his claim without regard to any deduction made in respect of matters not falling to be taken into account in determining whether the action could have been commenced in a patents county court.
(3) This section does not affect any question as to costs if it appears to the High Court that there was reasonable ground for supposing the amount recoverable in respect of the plaintiffs claim to be in excess of the prescribed amount.
(4) The High Court, if satisfied—

(a) that there was sufficient reason for bringing the action in the High Court, or

(b) that the defendant, or one of the defendants, objected to the transfer of the action to a county court,

may make an order allowing the costs or any part of the costs of the High Court scale or on such one of the county court scales as it may direct.
(5) This section does not apply to proceedings brought by the Crown.
(6) In this section "the prescribed amount" means such amount as may be prescribed by Her Majesty for the purposes of this section by Order in Council.
(7) No recommendation shall be made to Her Majesty to make an Order under this section unless a draft of the Order has been laid before and approved by a resolution of each House of Parliament.").
The noble and learned Lord said: My Lords, this clause imposes a costs sanction on any plaintiff who brings a case in the patent court which he could have brought in the patents county court, if he recovers damages of less than a certain figure. That prescribed amount will be set by order, and I have in mind, at least initially, a figure of possibly £60,000. We seek to ensure that smaller, run-of-the-mill cases—and I have in mind here patent infringement claims for damages—are dealt with in the patents county court.
The provisions embodied in this clause all derive from existing provisions contained in the County Courts Act 1984. The precedents followed have been the costs limitation applicable to contract and tort actions commenced in the High Court and similar provisions covering Admiralty proceedings. The costs limitation will not apply in cases where the High Court is satisfied that the plaintiff had reasonable grounds for supposing that the damages he would recover would be greater than the prescribed amount.

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This deals with the point that the noble Lord, Lord Lloyd of Kilgerran, mentioned—that it may be difficult to assess that and it might be reasonable to have assessed it rather higher than the judge may ultimately decide.
Nor will a plaintiff necessarily be penalised if the High Court is satisfied that there were sufficient reasons for bringing the case there, or that one of the defendants objected to transfer down. Nor under subsection (1) will the plaintiff in a case which has been transferred into the High Court be penalised. I beg to move.
On Question, amendment agreed to.
10 p.m.
The Lord Chancellor The Lord Chancellor moved Amendment No. 200:
After Clause 266, insert the following new clause:
("Proceedings in patents county court.
.—(1) Where a county court is designated a patents county court, the Lord Chancellor shall nominate a person entitled to sit as a judge of that court as the patents judge.
(2) County court rules shall make provision for securing that, so far as is practicable and appropriate—

(a) proceedings within the special jurisdiction of a patents county court are dealt with by the patents judge, and

(b) the judge, rather than a registrar or other officer of the court, deals with interlocutory matters in the proceedings.

(3) County court rules shall make provision empowering a patents county court in proceedings within its special jurisdiction, on or without the application of any party—

(a) to appoint scientific advisers or assessors to assist the court, Or

(b) to order the Patent Office to inquire into and report on any question of fact or opinion.

(4) Where the court exercises either of those powers on the application of a party, the remuneration or fees payable shall be at such rate as may be determined in accordance with county court rules and shall be costs of the proceedings unless otherwise ordered by the judge.
(5) Where the court exercises either of those powers of its own motion, the remuneration or fees payable shall be at such rate as may be determined by the Lord Chancellor with the approval of the Treasury and shall be paid out of money provided by Parliament.").
The noble and learned Lord said: My Lords, the amendment which constitutes this new clause is derived from the recommendations of the Oulton Committee, to which I have already referred. It covers two distinct areas affecting proceedings in the Patents County Court: first, the nomination and duties of a judge and, secondly, the appointment and remuneration of advisers or assessors to assist the court, and the provision of reports by the Patent Office. This is the point to which I referred a moment ago as part of the development towards an inquisitorial procedure.
Subsections (1) and (2)(a) reflect the importance we attach to the report's recommendation that business within the new jurisdiction should only be handled by a judge with experience of patent litigation. They will ensure that not only is a suitably qualified judge appointed to each court but also that he will handle, as far as is possible, all proceedings within the special jurisdiction.
The committee envisaged that the patents judge would take charge of both the interlocutory proceedings and the trial. Subsection (2)(b) provides for this. It is not, however, our intention to cast doubt
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on the power of the county court registrar to exercise his general statutory jurisdiction concerning such matters as enforcement proceedings and record keeping.
Subsection (3) allows county court rules to provide for the court to have a power, on or without any party's application, to appoint scientific advisers or assessors to assist the court, or to order the Patent Office to inquire into and report on any question of fact or opinion. There already exist within the County Courts Act 1984, the Patents Act 1977 and the Rules of the Supreme Court a number of provisions covering the appointment of scientific advisers to assist the court, or to inquire and report on questions of fact or opinion, and the appointment of assessors to assist the court.
This subsection repeats the existing provisions and introduces a new power, stressed by the committee in its report, to order the Patent Office to provide a report. Such a report will be confined exclusively to technical matters, guiding the judge towards a decision but not pre-empting it. These provisions for obtaining expert assistance in patent proceedings will, we believe, help the court to deal with proceedings in an efficient and informed manner.
The provisions concerning the defraying of remuneration for providers of expert assistance reflect the principles embodied in the existing legislation. Where the court exercises either of the powers in subsection (3) on the application of a party, the remuneration or fees payable will be determined by county court rules and will be costs of the proceedings, unless the judge orders otherwise. If the court exercises either power of its own motion, the remuneration and fees will be paid out of public funds. I beg to move.
Lord Lloyd of Kilgerran: My Lords, it is well known to the noble and learned Lord that possible reduction in costs in patent cases is largely dependent on a proper definition at an early stage of the issues to be decided and upon the firmness of the judge in giving directions to that end. I assume that the noble and learned Lord will have in mind that costs in patent actions sometimes escalate if the judge is not firm about experiments that have to be made. Once one side starts having experiments there are reply experiments, but no doubt that will be taken care of in the usual way by the appointment of a very firm judge in these matters.
The Lord Chancellor: My Lords, I entirely accept the point that has been raised by the noble Lord, Lord Lloyd of Kilgerran. It may not be easy to obtain a suitable judge, but one of the characteristics that one would like to see in the judge is not only that he be an excellent judge but that he has the firmness that the noble Lord has described.
On Question, amendment agreed to.
Clause 267 [Right of audience in patents county court]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 201:
Leave out clause 267 and insert the following new clause:
("Rights and duties of registered patent agents in relation to proceedings in patents county court.
.— (1) A registered patent agent may do, in or in connection with proceedings in a patents county court which are within the special jurisdiction of that court, anything which a solicitor of the Supreme Court might do, other than prepare a deed.
(2) The Lord Chancellor may by regulations provide that the right conferred by subsection (I) shall be subject to such conditions and restrictions as appear to the Lord Chancellor to be necessary or expedient; and different provision may be made for different descriptions of proceedings.
(3) A patents county court has the same power to enforce an undertaking given by a registered patent agent acting in pursuance of this section as it has, by virtue of section 142 of the County Courts Act 1984, in relation to a solicitor.
(4) Nothing in section 143 of the County Courts Act 1984 (prohibition on persons other than solicitors receiving remuneration) applies to a registered patent agent acting in pursuance of this section.
(5) The provisions of county court rules prescribing scales of costs to be paid to solicitors apply in relation to registered patent agents acting in pursuance of this section.
(6) Regulations 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.").
The noble and learned Lord said: My Lords, this amendment develops, and replaces, the second of the two marker clauses. It covers the rights and duties of patent agents in relation to patents county court proceedings.
The first subsection of this amendment restates the principle expressed in Section 60A(1) of the County Courts Act 1984, which presently appears in Clause 267. The actual scope of the provision is in fact slightly wider since Section 60A(1) would not have allowed a patent agent to conduct that part of the proceedings not within the courtroom. This amendment will put him on the same footing as a solicitor of the Supreme Court in the conduct of proceedings.
In the course of proceedings a party's legal representative may give various undertakings to his client or to the court and it is an important element in the confidence placed in that representative that there should be a sanction if he fails to make these good. Section 142 of the County Courts Act 1984 allows the county court to enforce an undertaking given by a solicitor. This amendment extends that power to a patent agent.
Section 60A(1) as it stands will not allow a registered patent agent to conduct litigation in the patents county court for reward. In order to allow for this it is necessary to disapply the prohibition on persons other than solicitors receiving remuneration in respect of a registered patent agent acting for a client in the patents county court.
The amendment at subsection (5) is needed to ensure that where a party represented by a patent agent in patents county court proceedings becomes entitled to costs against the other party, the patent agent's bill can be taxed in the same way as that of a solicitor. The County Courts Act currently provides for the county court rule committee to prescribe scales of costs to be paid to counsel and solicitors. This amendment widens that reference and allows patent agents to come under the existing scale provisions already drawn up under the rules. I beg to move.
On Question, amendment agreed to.
Schedule 1 [Copyright: transitional provisions and savings]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 202:
Page 125, line 42, leave out from ("I") to end of line 44.
The noble Lord said: My Lords, in moving this amendment I shall also speak to Amendment No. 203. Paragraph 7 of Schedule 1 is concerned with the subsistence of copyright in films made prior to commencement.
The first amendment in this group is pure drafting. The second limb of paragraph 7(2) is superfluous in view of the general proposition in paragraph 9 of Schedule 1.
The second amendment takes account of the fact that the sound-track of a film is treated by this Bill as a sound recording and not part of a film, which is the reverse of the treatment under the 1956 Act. The new paragraph 7A in Schedule 1 will expressly apply this new regime from commencement of the Bill to films and their sound-tracks made after the commencement of the 1956 Act. I should mention that this would have been the effect of the Bill in any event, but we thought it better to say so than to leave its effect to be teased out by interpretation of other provisions. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 203 to 208:
Page 125. line 47, at end insert—
("7A. A film sound-track to which section 13(9) of the 1956 Act applied before commencement (film to be taken to include sounds in associated sound-track) shall be treated for the purposes of the new copyright provisions not as part of the film, but as a sound recording.").
Page 127, line 44, at end insert—
("(1A) Section 18(3) (restricted acts to include hiring of copies of sound recordings, films or computer programs) does not apply in relation to a copy of a sound recording, film or computer program acquired by any person before commencement for the purpose of hiring it to the public.").
Page 129, line 48, leave out ("not so suffer modification") and insert ("to object to derogatory treatment").
Page 130, line 13, at end insert—
("21A. The right conferred by section (Right to privacy of certain photographs and films) (right to privcy of certain photographs and films) does not apply to photographs taken or films made before commencement.").
Schedule 2, page 136, line 26, leave out sub-paragraph (1) and insert—
("(1) Where the doing of a particular act is specifically authorised by an Act of Parliament, whenever passed, then, unless the Act provides otherwise, the doing of that act does not infringe the rights conferred by Part II.").
Page 136, line 31, at end insert—
(''Incidental copying in course of use of work in electronic form
10A.—(1) This paragraph applies to work whose use in electronic form ordinarily involves incidental copying of the whole or part of the work.
(2) Any such copying which a purchaser of a copy of the work is permitted to do without infringing the rights conferred by Part II, by express or implied consent or by virtue of any rule of law, and in respect of which he incurs no further obligation as to payment or otherwise, may also be done without infringement of those rights by any person into whose hands that copy of the work subsequently comes.
(3) Expressions used in this paragraph have the same meaning as in section (Incidental copying in course of use of work in electronic form).").
On Question, amendments agreed to.
[Amendment No. 209 not moved.]
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 210:
Page 137, line 14, at end insert—
("Recordings for purposes of supervision and control of broadcasts and cable programmes
12A.—(1) The rights conferred by Part II are not infringed by—

(a) the making or use of recordings by the Independent Broadcasting Authority for the purposes mentioned in section 4(7) of the Broadcasting Act 1981 (maintenance of supervision and control over programmes and advertisements); or

(b) anything done under or in pursuance of provision included in a contract between a programme contractor and the Authority in accordance with section 21 of that Act.

(2) The rights conferred by Part II are not infringed by anything done under or in pursuance of—

(a) a notice or direction given under section 16 of the Cable and Broadcasting Act 1984 (power of Cable Authority to require production of recordings); or

(b) a condition included in a licence by virtue of section 35 of that Act (duty of Authority to secure that recordings are available for certain purposes).

(3) Expressions used in this paragraph have the same meaning as in section (Recordings for purposes of supervision and control of broadcasts and cable programmes).")
On Question, amendment agreed to.
Schedule 3 [Registered designs: minor and consequential amendments of 1949 Act]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 211:
Page 140, line 30, leave out from ("country)") to end of line 31 and insert (", for subsections (2) and (3) substitute—").
The noble Lord said: My Lords, this is purely a drafting amendment which makes no changes of substance. The amendment will introduce a form of words into paragraph 7 which will be consistent with that used in other paragraphs of Schedule 3. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendments Nos. 212 and 213:
Page 142, leave out lines 20 to 22 and insert—

("(a) in England and Wales, the High Court or a patents county court (see Part VI of the Copyright, Designs and Patents Act 1988),

(b) in Scotland, the Court of Session, and

(c) in Northern Ireland, the High Court.").

Page 142, line 23, after ("court") insert ("with respect to proceedings in the High Court").
The noble and learned Lord said: My Lords, I have already spoken to these amendments. I beg to move.
On Question, amendments agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 214 and 215:
Page 145, line 23, at end insert—
("(2A) At the appropriate place insert—
" "author", in relation to a design, has the meaning given by section 2(3) and (4);".").
Page 145, line 33, at end insert—
("(6A) at the appropriate place insert—
" "employee", "employment" and "employer" refer to employment under a contract of service or of apprenticeship;".").
On Question, amendments agreed to.
Schedule 4 [The Registered Designs Act 1949 as amended]:
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 216 to 222:
Page 147, line 13, after ("intended") insert ("by the author of the design").
Page 147, line 19, leave out ("article") to ("aesthetic") in line 20 and insert ("if the appearance of the article is not material, that is, if").
Page 147, line 46, leave out ("a person") and insert ("an employee").
Page 148, line 9, leave out ("subsection (1)") and insert ("this Act"). Page 151, line 51, leave out ("in the United Kingdom or elsewhere").
Page 151, line 52, after ("made") insert ("in the United Kingdom or elsewhere").
Page 152, line 4, after ("(1)") insert ("or (3)").
On Question, amendments agreed to.
The Lord Chancellor The Lord Chancellor moved Amendments Nos. 223 and 224:
Page 161, leave out lines 35 to 37 and insert—

("(a) in England and Wales, the High Court or a patents county court (see Part VI of the Copyright, Designs and Patents Act 1988),

(b) in Scotland, the Court of Session, and

(c) in Northern Ireland, the High Court.").

Page 161, line 38, after ("court") insert ("with respect to proceedings in the High Court").
The noble and learned Lord said: My Lords, I have already spoken to these amendments. I beg to move.
On Question, amendments agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 225 and 226:
Page 166, line 26, at end insert—
(" "author", in relation to a design, has the meaning given by section 2(3) and (4);").
Page 166, line 36, at end insert—
(" "employee", "employment" and "employer" refer to employment under a contract of service or of apprenticeship;").
The noble Lord said: My Lords, I have already spoken to these amendments. I beg to move.
On Question, amendments agreed to.
Schedule 5 [Patents: minor amendments]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 227:
Page 173, line 41, leave out paragraph 5 and insert—
("5.—(1) Section 28 of the Patents Act 1977 (restoration of lapsed patents) is amended as follows.
(2) For subsection (1) (application for restoration within period of one year) substitute—
"(1) Where a patent has ceased to have effect by reason of a failure to pay any renewal fee, an application for the restoration of the patent may be made to the Comptroller within the prescribed period.
(1A) Rules prescribing that period may contain such transitional provisions and savings as appear to the Secretary of State to be necessary or expedient.".").
The noble Lord said: My Lords, with the leave of the House, in moving Amendment No. 226, I shall speak also to Amendments Nos. 228 and 229. The first of these amendments concerns the period during which a lapsed patent may be restored. At Report stage my noble friend Lord Stockton suggested that it might be better if the period were prescribed by rules made by the Secretary of State rather than by

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the primary legislation. This would make the period chosen easier to change if, in practice, it proved to be wrong; either too long or too short. I said we were happy to follow this approach but needed time to consider the precise wording and to review the transitional provisions. I trust my noble friend will find that the present amendment achieves what he intended.
The other two amendments, Amendments Nos. 228 and 229, are merely consequential drafting changes. I beg to move.
The Earl of Stockton: My Lords, I thank the Minister for following up my suggestion. This is entirely satisfactory.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos, 228 and 229:
Page 174, leave out line 11 and insert ("(3) In".
Page 174, line 14, leave out ("above amendment") and insert ("amendment in sub-paragraph (3)").
On Question, amendments agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 230:
Page 177. line 29, at end insert—
("Proceedings before the Patents Court or the comptroller
17A. In the Patents Act 1977, after section 99 (general powers of the court) insert—
"Power to order report hi Patent Office.
99A.—(1) Rules of court shall make provision empowering the Patents Court in any proceedings before it under this Act, on or without the application of any party, to order the Patent Office to inquire into and report on any question of fact or opinion.
(2) Where the court makes such an order on the application of a party, the fee payable shall be at such rate as may be determined in accordance with rules of court and shall be costs of the proceedings unless otherwise ordered by the court.
(3) Where the court makes such an order of its own motion, the fee payable shall be at such rate as may be determined by the Lord Chancellor with the approval of the Treasury and shall be paid out of money provided by Parliament.".
17B. For section 102 of the Patents Act 1977 (right of audience in patent proceedings) substitute—
"Right of audience, &c. in proceedings before comptroller.
102.—(1) A party to proceedings before the comptroller under this Act, or under any treaty or international convention to which the United Kingdom is a party, may appear before the comptroller in person or be represented by any person whom he desires to represent him.
(2) No offence is committed under the enactments relating to the preparation of documents by persons not legally qualified by reason only of the preparation by any person of a document, other than a deed, for use in such proceedings.
(3) Subsection (1) has effect subject to rules made under section 258 of the Copyright, Designs and Patents Act 1988 (power of comptroller to refuse to recognise certain agents).
(4) In its application to proceedings in relation to applications for, or otherwise in connection with, European patents, this section has effect subject to any restrictions imposed by or under the European Patent Convention.
Right of audience, &c. in proceedings on appeal from the comptroller.
102A.—1 A solicitor of the Supreme Court may appear and be heard on behalf of any party to an appeal under this Act from the comptroller to the Patents Court.
(2) A registered patent agent or a member of the Bar not in actual practice may do, in or in connection with proceedings on an appeal under this Act from the comptroller to the patents Court, anything which a solicitor of the Supreme Court might do, other than prepare a deed.
(3) The Lord Chancellor may by regulations—

(a) provide that the right conferred by subsection (2) shall be subject to such conditions and restrictions as appear to the Lord Chancellor to be necessary or expedient, and

(b) apply to persons exercising that right such statutory provisions, rules of court and other rules of law and practice applying to solicitors as may be specified in the regulations;

and different provision may be made for different descriptions of proceedings.
(4) Regulations 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.
(5) This section is without prejudice to the right of counsel to appear before the High Court."."),
The noble and learned Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Schedule 6 [Provisions for the benefit of the Hospital for Sick Children]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 231:
Page 178, line 37, leave out from ("copyright)") to ("be") in line 38.
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
10.15 p.m.
Schedule 7 [Consequential amendments: general]:
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 232:
Page 182, line 26, at end insert—
("and in paragraph 10A (services of European patent attorneys) for "section 84(7) of the Patent Act 1977" substitute "Part V of the Copyright, Designs and Patents Act 1988".").
The noble Lord said: My Lords, in moving this amendment I speak also to Amendment No. 233. The paragraphs of Schedule 7 in question make consequential amendments to the Fair Trading Act 1973 and the Restrictive Trade Practices Act 1976. Amendments to these paragraphs made on Report had the effect of reprieving certain provisions and schedules to the 1973 and 1976 Acts which were to have been deleted.
However, we have now realised that these reinstated provisions include references to Section 84 of the Patents Act 1977 which is going to be replaced by provisions in Part V of this Bill. The present amendments are therefore intended to correct the references. This is not strictly necessary because the Interpretation Act would have led to the correct result, but we feel that in the interests of clarity the amendments should be made. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 233:
Page 182, line 41, at end insert—
("and in paragraph 10A (services of European patent attorneys) for "section 84(7) of the Patent Act 1977" substitute "Part V of the Copyright, Designs and Patents Act 1988".").
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 234:
Page 183, line 31, at end insert—
("Resale Prices Act 1976 (c.53)
16A. In section 10(4) of the Resale Prices Act 1976 (patented articles: articles to be treated in same way), in paragraph (a) after "protected" insert "by design right or".").
The noble Lord said: My Lords, the Resale Prices Act 1976 prohibits resale price maintenance. Special provision is made in Section 10 for what are rather artificially called patented articles. I say "artificially" because the meaning of that expression is extended by subsection (4) of that section to cover registered designs and plant breeders' rights. It seems to us that it should also cover design right, and the amendment would so provide. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 235:
Page 183, line 33, leave out paragraph 17 and insert—
("17. In section 57 of the Patents Act 1977 (rights of third parties in respect of Crown use of patent), in the closing words of subsection (1) (which relate to the use of models or documents), after "copyright" insert "or design right".
17A. In section 105 of the Patents Act 1977 (privilege in Scotland for communications relating to patent proceedings), omit "within the meaning of section 104 above", make the existing text subsection (1), and after it insert—
"(2) In this section—
"patent proceedings" means proceedings under this Act or any of the relevant conventions, before the court, the comptroller or the relevant convention court, whether contested or uncontested and including an application for a patent; and
"the relevant conventions" means the European Patent Convention, the Community Patent Convention and the Patent Cooperation Treaty.".
17B. In section 123(7) of the Patents Act 1977 (publication of case reports by the comptroller) —

(a) for "and registered designs" substitute "registered designs or design right",

(b) for "and copyright" substitute ", copyright and design right".

17C. In section 130(1) of the Patents Act 1977 (interpretation), in the definition of "court", for paragraph (a) substitute—
"(a) as respects England and Wales, the High Court or a patents county court (see Part VI of the Copyright, Designs and Patents Act 1988);".").
The noble and learned Lord said: My Lords, in moving this amendment I shall speak also to Amendment No. 241. These amendments contained in Schedules 7 and 8 to the Bill are all consequential and technical in nature. If your Lordships desire a more detailed explanation I will be happy to give it.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 236 to 238:
Page 184, line 30, after ("make") insert ("and use").
Page 184, line 30, leave out from ("them") to end of line 34.
Page 184, line 39, leave out fro beginning to end of line 4 on page 185.
The noble Lord said: My Lords, I have already spoken to these amendments. I beg to move.
On Question, amendments agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 239:
Page 185, line 20, after ("trade mark,") insert ("service mark,").
The noble Lord said: My Lords, in moving Amendment No. 239 I shall speak also to Amendments Nos. 240 and 244. Paragraphs 25 and
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28 of Schedule 7 amend the company laws of Great Britain and Northern Ireland to take account of design right. In the case of England, Wales and Northern Ireland, but not Scotland, where the relevant provision is slightly different, this is done by a restatement of the definition of intellectual property. That definition includes a reference to trade marks but fails to mention service marks. Amendments Nos. 239 and 240 remedy that deficiency.
The existing provisions in the Companies Act 1985 and the Companies (Northern Ireland) Order 1986 already refer to service marks by virtue of amendments contained in the Patents, Designs and Marks Acts 1986. Those amendments accordingly become irrelevant and are repealed by Amendment No. 244.
I should perhaps mention that Amendment No. 245 has remained on the Marshalled List in error and I shall not be moving it. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendment No. 240:
Page 185, line 44, after ("trade mark,") insert ("service mark.").
The noble Lord said: My Lords, this amendment has already been spoken to. I beg to move.
On Question, amendment agreed to.
Schedule 8 [Repeals]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 241:
Page 187, line 53, column 3, leave out ("Sections 104 and 105") and insert—
("Section 104. In section 105, the words "within the meaning of section 104 above".").
The noble and learned Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Lord Beaverbrook Lord Beaverbrook moved Amendments Nos. 242 to 244:
Page 188, line 19, column 3, at end insert ("Section 16(4) and (5).").
Page 188, line 21, column 3, after ("35") insert ("(2) and").
Page 188, line 35, column 3, at end insert ("in paragraph 1(2)(k) the words "subsection (1)(j) of section 396 and" and in paragraph 1(2)(l) the words "subsection (2)(i) of section 93".").
The noble Lord said: My Lords, I have already spoken to these amendments. I beg to move.
On Question, amendments agreed to.
[Amendment No. 245 not moved.]
An amendment (privilege) made.
Lord Beaverbrook: My Lords I beg to move, That the Bill do now pass.
When my noble friend the Secretary of State for Trade and Industry commended this Bill to your Lordships on Second Reading, he described it as a long and technical one. After four months in your Lordships' House and consideration of nearly 1,300 amendments, I doubt whether any of your Lordships would disagree with that assessment. My noble friend also described it as an important Bill. Again, I believe that to be an accurate description since this Bill

737
provides a framework of copyright and designs law which will have to last for many years. Indeed, I doubt whether many of your Lordships would welcome another copyright Bill too soon.
There is a general consensus both within your Lordships' House and in the outside world that the law of copyright and designs is due for reform. On some issues there is broad agreement on what needs to be done. Unfortunately, on many other issues the consensus rapidly breaks down. There arc many differing views on the right way forward. In any discussions on intellectual property there is an inherent tension between the creators and the owners of rights on the one hand and the users on the other. One side wants very strong protection. The other is inconvenienced by the rights and often presses for their dilution. Indeed, someone who is both a supplier and a user of intellectual property may be in the position of facing both ways and arguing for greater protection for his intellectual property while at the same time pressing for restrictions in the rights of those whose works he uses.
This has been therefore sometimes a controversial Bill although not usually on party political lines. Some of the livelier debates have been conducted between your Lordships on the same side of the Chamber rather than across the Floor. Given these factors and the technical complexity of the Bill, it is perhaps not surprising that this Bill has occupied your Lordshps for seven days in Committee, for four days on Report and for a considerable time today. I believe that the time and effort have all been worthwhile. What was a good Bill is now a very good Bill. If, as I trust, your Lordships agree that this Bill should pass, it will go to another place much improved.
The overall structure and content of the Bill has not changed greatly. There have been only three major additions. First, the provision of a rental right; secondly, the removal of the limitation on fair dealing in respect of commercial research. Last and not least, there has been the provision of a perpetual royalty right for Great Ormond Street Hospital in respect of Peter Pan. Although there have been few major changes, significant changes have been made to the drafting in some of the detailed provisions.
Amendments made to the Bill now total several hundred. They have been prompted almost entirely by comments made in debate in this House. I believe that this reflects great credit upon your Lordships. Our debates have been well informed and of a consistently high standard. This has been commented upon by those who have listened to our deliberations or who have read them in Hansard. As evidenced by the number of amendments we tabled both on Report and today, we have shown ourselves willing to listen to what your Lordships have said and to act when we believe that a good case has been made. The powers of argument and persuasiveness deployed so skilfully in the House have made every case seem a good one. We have had to look at everything very carefully indeed before coming to our conclusions.
It must be said that the debates in your Lordships' House have proved most helpful in our considerations. Many useful suggestions have been made for small changes. Comments have been made
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which caused us to go back to square one and to re-examine our policy. Sometimes that exercise has shown us that we were wrong; sometimes it has confirmed us in our view. Either way the exercise was worthwhile.
In expressing the thanks of the Government for the care and patience and not inconsiderable expertise that your Lordships have expended on this Bill, it is perhaps invidious to single out individuals; but I feel obliged to mention one or two. On the Benches behind me I should like to mention my noble friends Lord Stockton, Lord Mottistone, Lord Lucas of Chilworth; my noble and learned friend Lord Hailsham and in the later stages my noble friend Lord Jenkin of Roding. They have all made significant contributions. I have not been able to accede to all their wishes as often as I might have liked. However, I am nevertheless grateful for their contributions. I am also grateful to my noble friend Lord Dundee who has helped me so much on this Bench.
On the Cross-Benches we have had the great benefit in Committee of the noble and learned Lords, Lord Denning and Lord Simon, with contributions at various stages from the noble Lord, Lord Hacking. From the other side there have been significant contributions from the noble Lords, Lord Howie of Troon, Lord Gray, Lord Willis and Lord Lloyd of Hampstead, who showed considerable understanding of the complexities of the Bill. We have also had the noble Lord, Lord Kilbracken, whose crusade to improve the drafting of the Bill has prompted a large number of amendments.
I record my thanks also to the noble Lord, Lord Lloyd of Kilgerran, who has played a major role in the proceedings. He has given the benefit of his considerable experience in the field of intellectual property, which combined with his unfailing courtesy and eloquence has done much to facilitate consideration of the Bill.
Last but by no means least, there are the noble Lords, Lord Williams of Elvel and Lord Morton of Shuna. They made their intentions clear at the outset. The noble Lord, Lord Morton of Shuna, promised us that the Opposition would take a full and active part. In the first debate in Committee, the noble Lord, Lord Williams of Elvel, indicated that he would thoroughly probe our intentions to ensure that we all knew what the Bill was about. Both pledges have been amply fulfilled. Many changes to the Bill flow from the persistent probing of noble Lords opposite. Their questioning has been impeccably fair, invariably courteous and, in spite of the complexities of the Bill, seldom based on misunderstanding and misconception.
Some 18 months ago in the debate on the Third Reading of the Financial Services Bill the noble Lord, Lord Williams of Elvel, made some kind remarks welcoming me to this Bench, although promising me some faster bowling in the future. I do not know about the pace on the Bill, but there has certainly been some spin. Noble Lords opposite kept up a barrage of tricky deliveries. Like all good bowlers, they have hunted in pairs. My relief at seeing the noble Lord, Lord Williams of Elvel, leave his place for a short while was always tempered by the

739
realisation that the noble Lord, Lord Morton of Shuna, was coming on fresh to renew the attack.
I pay tribute also to the immense amount of persistence and hard work that my officials at the Department of Trade and Industry have put into the Bill. It has been a monumental task, which has involved them in giving up many nights, evenings and weekends. I thank them for the help that they have given to me, to other noble Lords and to many outside interests that have been pressing us to change provisions in the Bill.
We have all spent a long time on the Bill. I believe that it has been time well spent. It is a Bill that strikes the right balance between protection for the originator and the need that the market has for access to intellectual property of all kinds. It will provide us with a framework of intellectual property law, especially in regard to copyright and designs, that will serve the economy well in the years to come. The Bill is even better equipped to fulfill that function as a result of your Lordships' exhaustive and at times exhausting consideration. I commend it to the House.
Moved, That the Bill do now pass.—(Lord Beaverbrook.)
10.30 p.m.
Lord Williams of Elvel: My Lords, when the Bill was first introduced into your Lordships' House it gave us considerable problems in that it was a large Bill which covered a number of subjects and introduced a number of new concepts. As the debates have continued, we on this side have better understood the Government's intentions. As a result of our spin bowling, to use the Minister's expression, we have managed to encourage the Government to improve the Bill. That this has happened is due not to the fact that my noble friend Lord Morton of Shuna is an expert at the googly but to the Government's receptive attitude to arguments put forward in genuine good faith by the Opposition and by members of my own party who for one reason or another have felt it necessary to put forward various points from experience in their own lives.
The first point on which I congratulate the Government is their attitude towards the debates in your Lordships' House. It is an excellent and, in my short experience of your Lordships' House, an unparalleled example, of the way a government can introduce a Bill which is not of a party political nature and say at the outset, "We are prepared to accept all reasonable arguments." They have allowed us, as the Opposition, to feel that we are joining in the creation of proper legislation, rather than simply opposing such legislation that the Government put forward. Therefore, as I have already said, I congratulate the Government on their attitude.
There are many points in the Bill with which we, the Opposition, are not wholly satisfied. I am sure the noble Lord would be the first to admit that some of our points have not been accepted by the Government and no doubt will be debated when the Bill goes to another place. However, we are encouraged by the Government's concessions to reasoned argument and we very much hope that that open-mindedness will continue in another place.
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We were especially pleased that the Government were able to accede to the rental right in copyright which we felt was an important provision. Then there was the blank-tape levy which we thought that we should support and which will no doubt be debated in another place. In that connection we still feel that the Government's position is somewhat illogical. There are of course many technical points in the Bill which will similarly be debated elsewhere.
However there are three major doubts that we still retain about the Bill, all of which relate to employee rights, which we have discussed at some length but on which we have thus far failed to reach agreement. First, there is the whole concept of design right. In that respect we believe that there may be a different point of view which, again, will no doubt be argued in another place. Secondly, there is Crown copyright. That is another issue which I think still needs a certain amount of airing. Thirdly, there is the smaller issue—although not small in terms of its impact—that arises under Clause 36 which concerns the photocopying of material in educational establishments, namely; which percentage should be appropriate for which quarter? We should merely like to reserve our position on that issue—certainly as a party we would wish to do so.
I am most grateful to the Government for the Peter Pan amendment. In my view this was a remarkable example of how government and opposition can work together to achieve an objective which all our advisers said was "outrageous", and really should not happen. Nevertheless, it was for a desirable end and I think all noble Lords would agree that here was an occasion when Parliament could perhaps put its stamp on a Bill by saying, "This is something we want to do and even though it is outrageous in terms of legality and precedent, nevertheless we believe it is desirable and we want it to go through."
I am most grateful to my noble friend Lord Morton of Shuna—who has a googly which the noble Lord, Lord Beaverbrook, knows well!—and to my noble friend Lady Birk for their support in what have been long and arduous Committee, Report and, indeed, Third Reading stages. I should also like to express my thanks to all my noble friends on these Benches who have participated in the debates.
However, above all, I must say that I am grateful to the noble Lord, Lord Beaverbrook, who has conducted himself in a manner which is in the best traditions of your Lordships' House. He undertook the Bill. I believe that it is the first time that he has taken a large Bill through the House. He has conducted himself in an exemplary manner. He has always been courteous, kind and understanding. For the Opposition, as we are without large battalions of civil servants behind us, that means a great deal. On this Bill—if I may say so without disrespect to him—the noble Lord has made his reputation in the House.
I have also to echo what the noble Lord said about the officials in the Department of Trade and Industry, who have been unfailingly co-operative. They have supplied the noble Lord with immediate briefings—if I may put it like that—on especially difficult spin bowling so that he has been able to fend off our googlies without any problem.

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We wish the Bill well. We believe that the Bill is better, having gone through the debates in your Lordships' House, than it was when it started. There will no doubt be amendments and further debates in another place. Nevertheless, we believe that the Bill is a good Bill in that it restates the law of copyright; it makes certain major amendments to patent law, and it makes the whole issue of intellectual property more coherent for the layman than it was before the Bill was produced. We therefore wish it well. In particular, if I may say so very personally, I am grateful to the noble Lord, Lord Beaverbrook, for the work that he has done.
Lord Lloyd of Kilgerran: My Lords, perhaps I may briefly but nevertheless sincerely thank the Minister for his kind words about me. Perhaps I may presume to congratulate him on his courtesy, competence, good humour and tolerance at all times when dealing with the massive Bill with its 1,300-odd amendments. I also once again add my thanks to his hard-working officials who have been so helpful not only to Members of the House but to people from industry and law firms who came to consult them. I also thank those who from time to time supported some of the statements that I made in the House.
I leave with one sense of disappointment. As an honorary associate member of a trade marks institute, who was its guest of honour last week, I was asked why the Bill, which refers so frequently to trade marks, does not yet have the words "trade marks" in the Title.
The Earl of Stockton: My Lords, this has been the first major Bill in which I have taken part. I am grateful to noble Lords on all sides of the House for their help and forbearance in my efforts. As a book and magazine publisher, I may perhaps echo the words of my noble friend the Minister and say that it is now a fine Bill. To have been part of its creation has frequently been a pleasure and has always been an education.
Lord Lucas of Chilworth: My Lords, I begin with the DTI press notice of 30th October, which started by saying:
"A Bill which will provide an improved system of protection for intellectual property until well into the next century has been published today, 30th October".
I think that this is the point with which the noble Lord, Lord Williams of Elvel, finished: this has been a long and fascinating Bill. Whether it lasts, as we all hope it will, well into the next century, time alone will tell, because there are always developments.
I may perhaps be personal. I turn, if I may, with clue respect to your Lordships' House, to the Box on my left. I should like to say to the officials "Thank you very much". Undoubtedly, under the guidance of the Minister in charge, the officials have been unfailingly courteous, unfailingly helpful and diligent. They must have given up a great deal of time.
This has been a long Bill. The noble Lord, Lord Beaverbrook, the Minister in charge, and I worked together for a short while. Perhaps I personally may congratulate him for the manner in which he has conducted proceedings in your Lordships' House. That I personally have not got quite what I wanted
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does not matter overmuch. He has listened, talked with us and come to a conclusion different from the one I reached.
The important point, as the noble Lord, Lord Williams said, is that none of us has been antagonistic. We have put forward alternative views which the Government have considered. On occasions the Government came to different conclusions. I do not think that matters. The important thing is that the department and my noble friend were open-minded. They listened and talked to us. I thank them very much.
I know full well that this Bill goes to another place in very much better shape than when it entered your Lordships' House. That is undoubtedly due to the efforts of my noble friend Lord Beaverbrook and his officials.
Lord Beaverbrook: My Lords, I should like to thank all noble Lords for their kind words and to echo all your Lordships' views in saying how much we appreciate the contribution of my noble and learned friend the Lord Chancellor. We appreciate seeing him here at this late hour of the night when he has so many other matters to attend to.
On Question, Bill passed and returned to the Commons with amendments.

Education (Publication and Consultation etc.) (Scotland) Amendment Regulations 1988
10.42 p.m.
Lord Morton of Shuna Lord Morton of Shuna rose to ask Her Majesty's Government what is their response to the 16th Report of the Joint Committee on Statutory Instruments on the Education (Publication and Consultation etc.) (Scotland) Amendment Regulations 1988, No. 107 [HL Paper 49].
The noble Lord said: My Lords, in asking the Question standing in my name on the Order Paper, I start by bringing to the notice of the House the fact that the regulations to which the report refers were made on 26th January and came into force and were laid before Parliament on 27th January.
As your Lordships will be aware, there are statutory provisions relating to regulations of this type. They are found in the Statutory Instruments Act 1946. Section 4 says that,
"any statutory instrument is required to be laid before Parliament after being made"—
and before coming into force—
"Provided that if it is essential that any such instrument should come into operation before copies thereof can be so laid as aforesaid, the instrument may be made so as to come into operation before it has been so laid; and where any statutory instrument comes into operation before it is laid before Parliament, notification shall forthwith be sent to the Lord Chancellor and to the Speaker of the House of Commons drawing attention to the fact that copies of the instrument have yet to be laid before Parliament and explaining why such copies were not so laid before the instrument came into operation".
The unfortunate fact referred to in the report of the joint committee is that that is the situation covered by the proviso. The requirement of the proviso is first of all that the Government should show that it was essential that the provision should come into force

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before it was laid. That they have made no attempt to do. All they can say is that it was advisable that the regulations should be known by Strathclyde Regional Council before 3rd or 12th February. There was not a word as to why it was essential that they should come into force before being laid before Parliament on 27th January.
Then there is a requirement, which I understand was not met, that a letter or a notification explaining why it was essential that it should come into operation before it was laid before Parliament should be sent to the noble and learned Lord the Lord Chancellor and the Speaker in another place. This was just ignored. My principal provision in asking this question is to draw the attention of noble Lords to the fact that it appears that the Government are quite prepared, if they consider it necessary for political purposes, to ignore the laws as to the bringing in of regulations. Now there have been numerous occasions in various Bills where we have complained in this House—and no doubt in another place they have also complained—that there is excessive use of the power of making regulations.
If one was reasonable, one would have hoped that the Joint Committee on Statutory Instruments would have some effect on the Government in seeing that they kept to the rules. The Joint Committee on Statutory Instruments has an in-built majority in favour of the Government party and always has. It always has as its chairman a Member of the Opposition party. But it always has a government majority.
The joint committee's report is very specific. But the Government just ignore its report and make no answer whatever. It appears to me that this is what the noble and learned Lord, Lord Hailsham of Saint Marylebone, was referring to prior to 1979 as a democratic dictatorship. In other words, if the Government have a majority in the House of Commons it does not matter what the rules are, they will force through whatever they happen to want.
There is no question but that the necessity for these regulations did not exist in any way at all because Strathclyde Regional Council was doing its duty in dealing with the need for schools closures. It was having a long consideration process, and some time in the middle of February it was going to start the statutory consultation process.
But because of some gentleman who has employment in Wapping who happened to have been at Paisley grammar school, and to have some kind of access to somebody in power in the Government, it was considered advisable to bring in regulations to deal with one specific school—Paisley grammar school—and to deal with it in regulations which, as the joint committee suggests, are very difficult to interpret, will encounter litigation on any interpretation of what they mean and were wholly and utterly unnecessary.
It appears to me that these regulations show a total contempt for the legislation that was passed in 1946 and has been obeyed by every Government since then. They show a total misunderstanding of what is meant by the word "essential". I would remind the noble and learned Lord opposite that we have
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discussed that in relation to the Criminal Justice Bill. If this is the interpretation of "essential", it means something different from what the Oxford English Dictionary suggests that it might mean.
This is a deplorable example of regulations being passed against the whole spirit of what regulations are designed to meet. It is regulations being passed for one specific political purpose about one specific school without making any consideration whatever about what the effects may be on other schools in other areas. It is wholly bad. It is wholly personal. It is wholly inappropriate and I hope the noble and learned Lord when he comes to answer the point will attempt to answer it because in the debate that occurred in another place the Government apparently did not condescend to do so.
Lord Mackie of Benshie: My Lords, I shall not attempt to follow the noble Lord, Lord Morton of Shuna, in his criticism of the Government's actions and the way they have ignored custom and regulation. I think that everything that he has said is true. However, I should like the noble and learned Lord, when he comes to reply, to consider the circumstances of the case, which I think differ from the interpretation of them which has been given by the noble Lord, Lord Morton. We have caucus rule of the Labour Party in Glasgow and on the Clyde generally. Once something is decided inside the caucus, no amount of consultation will reverse the decision. That has been a feature of Labour rule all over Scotland. It is a feature which my party has long criticised.
It is also true that the words "grammar school" are anathema to the Labour Party in Scotland. One of the better Labour parties destroyed Aberdeen grammar school many years ago; it even changed the name after 500 years. There is also no question that the ethos of a school has a great deal to do with its value to the community. There is no question that local feeling was wholly in favour of the retention of the school which has been mentioned. However, it was unable to find expression in the light of the caucus rule to which I have referred. On that matter, I criticise the Labour Party wholly and completely and admit that an injustice was going to be done.
On the other hand, the Government have taken the wrong road. Surely case after case must tell them that it is the electoral system that is wrong. I am aware that noble Lords may think that they have heard too much about proportional representation. However, case after case shows the necessity for it. For the Government to push through regulations in an irregular manner again shows that if there is proper representation in local government, that sort of thing will not happen. The system gives the Labour Party an overwhelming majority on local councils, and it uses that majority quite brutally for its own purposes. Perhaps the noble and learned Lord will comment on that matter and on the effect of the electoral system on decisions taken.
Lord Carmichael of Kelvingrove: My Lords, I am grateful to my noble friend for having given us the opportunity to discuss the matter. I do not intend to speak for very long; I believe that he covered the main points. I should also like to dissociate myself totally

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from the statements made by the noble Lord, Lord Mackie of Benshie. I know a great many Labour councillors who are involved in education; and they are people who have been chosen because of their great love for education. They spend a great deal of time and effort in trying to get a good education system.
It is always difficult when, because of the demographic situation, there are difficulties. I am not criticising demographers unduly, but in the past 20-odd years they have got it wrong a lot of times. It is always a difficult matter. I was a local councillor for a short period. I continued in the same area as a Member of Parliament for over 20 years. I received many complaints about school closures. This regulation is plainly about Paisley grammar school; It is not about anything else. It should be emphasised that all the discussion about the Paisley grammar school overlooks, and is being selfish in overlooking, the fact that every school has its ethos, and that, particularly when a school is going to be closed or there will be great alterations, the local people, teachers, parents and pupils are greatly offended. I know of few schools that are easily closed. If I have any criticism of Strathclyde it is that it should have started a little earlier in announcing some of its closures. However, it has great problems in terms of local attitudes to school closures and in balancing the desires of the parents and balancing the types of schools. It has problems in regard to the stock and property of the schools. Whatever assets Paisley grammar school may have, they are certainly not the buildings. The buildings would certainly not in other circumstances meet with the approval of the parents.
Before the Education Act 1981 (on which this order is based) the Secretary of State had the power to intervene in all school closures. He had to give approval. Under previous Secretaries of State—the two I knew best were my noble friend Lord Ross of Marnock and Mr. Bruce Millan—there was intervention only to the extent of asking whether the parents, the pupils and the staff had been thoroughly consulted. They did not feel that they should interfere further.
Nevertheless, under the 1981 Act the Government took this power away from the Secretary of State and gave it only to the local authorities on the basis that the Secretary of State had no right to interfere with a local matter. It was considered to be a local job for the local authority to do. That view was expressed by the Minister at the time, the honourable Member for Eastwood, who is now most vociferous in trying to support the continuation of Paisley grammar school.
When the Bill was going through the House, the Opposition at the time, of which I was a member, said that if the Secretary of State were to yield up his power to the local authorities—a proposal of which we did not disapprove although we thought it unnecessary because of the way previous Secretaries of State had handled the matter—the decision should be across the board. The Government said no, and maintained the right of the Roman Catholic hierarchy alone to interfere when a school was about to be closed. There were many historic reasons for that. I do not blame the hierarchy
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for its worries about it. However, my point is that in 1981 the Government had the opportunity to continue this system but they specifically said that it was a matter for the local authority except in the case of denominational schools where the hierarchy should have some say.
The Government had plenty of opportunity at that time to intervene but they decided that it was a local matter and continued in that way. Then we come to Paisley grammar school. With totally undue haste and cynicism they introduced this order which was dealt with so well by my noble friend Lord Morton of Shuna. In bringing in the regulations the Scottish Office should have notified Mr. Speaker and the Lord Chancellor of its reasons for doing so. It failed to do that and therefore was in breach of the Statutory Instruments Act 1946.
I hope that the noble and learned Lord the Lord Advocate will be able to deal with that point. It was not dealt with adequately by the Minister, who is the guru behind this measure. I refer to the honourable Member for Stirling, who seems to have taken on the mantle of Adam Smith. From my small understanding of Adam Smith, the honourable Member has been selective about the matter. The explanation given by the Minister in another place was very inadequate.
I should like to finish by referring again to the quite unprecedented action of the Prime Minister in putting pen to paper and writing personally to the headmaster of a single school—one school out of thousands in Scotland. There are also the very important questions with which my noble friend dealt concerning the 80 per cent. capacity or use of the school, who decides the matter and how it is worked out. Will there be litigation and if so, will there possibly be litigation in other cases—because there were one or two that were on the borderline? The definition of what is 80 per cent. capacity or use of the school is something that is left very vague.
My noble friend spoke about the man from Wapping and he was referring to the editor of the Sunday Times, who is an old boy of Paisley grammar school. He has made clear that he had an influence on the Prime Minister which directly or indirectly resulted in her letter to the headmaster. As I say, that is an unprecedented act by a Prime Minister. Whether he would still claim that the influence was direct or indirect, I do not know. He may not know now and he may have had second thoughts about it, but some day memoirs will be written and the background to this squalid little story will be told in full.
I do not think it will do any good at all for politics, for either House of Parliament or for the institution of democracy. I believe that it will provide ammunition for those who in the future will use such stories to denigrate the whole structure of politics in this country. The only way in which such a thing can be described, and I am sure that in the future it will be so described, is as a totally squalid little act by a government which is trying to preserve something—falsely I believe—in Paisley.
The Lord Advocate (Lord Cameron of Lochbroom): My Lords, the noble Lord opposite introduced this Question with a series of remarks which I am bound

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to say would have been met in any court of law by a plea to relevancy, because except in one point his remarks bore not at all upon the Question that he put down.
There has been a great deal said tonight about the circumstances in which the regulations came to be made. These have been a matter of debate both in this House and in another place. Certainly it does not and did not fall within the 16th report of the joint committee. I think it is only right for me to say that I do not propose to deal further with these matters. They have nothing to do with the Question which was put down to be answered tonight.
However, I shall make quite clear that, contrary to the point made by the noble Lord, Lord Morton of Shuna, the statute gives power to my right honourable friend the Secretary of State to make these regulations. Having taken his decision to make the regulations as he was empowered to do, my right honourable friend judged that it would be essential in everybody's interests that they should come into force immediately. As the noble Lord, Lord Morton of Shuna, said, the regulations were made on 26th January. Meetings of the Strathclyde Education Committee were scheduled for the 3rd and 12th February, and the latter meeting was a special meeting at which the review group's proposals were to be considered.
If the Secretary of State had laid the regulations when he did and provided that they should come into force 21 days later, the education committee would have held its meetings knowing that these regulations had been made but had not yet come into force. However, so that there should be no question whatever of retrospective use of powers, and so that the regional council should not be in any doubt at all that the regulations would bear upon any decisions taken at such meetings, it was provided that the regulations exceptionally should come into force at the very earliest possible date.
The noble Lord has not referred to the 1981 Act, but particular regard was had to the provisions of Section 22A of that Act, which deals with the case when an education authority makes a proposal, and provides for publication and consultation. It was clearly proper that those making representations, as well as the authority itself, should be in no doubt that certain proposals, if made, were the subject of reference to the Secretary of State upon criteria that were set out in the regulations. There could thus be no grounds for suggesting that the Government had changed the rules in the middle of statutory consultation.
The Government thought that they had made it plain to the joint committee in the department's second memorandum to the committee, in which it was stated:
"It was also considered desirable that the instrument should come into force before the Council so decided, so as to avoid any suggestion that, by applying to proposals already made, the instrument had retrospective effect".
The joint committee has apparently not complained of the decision to set aside the 21-day convention but has concentrated on a more limited criticism; namely, that the regulations came into
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operation before they were laid before Parliament. I suppose that is technically true. The regulations were laid before Parliament and came into operation on the same day. What the joint committee has complained of is that whereas the regulations therefore came into operation at midnight they were not laid until 4 p.m., some 16 hours later.
The report acknowledges tacitly that the procedure required for this circumstance in Section 4 of the Statutory Instruments Act 1946 was followed, in that the Speaker and the Lord Chancellor were notified by letter that the regulations had come into operation ahead of being laid. Therefore the noble Lord, Lord Morton of Shuna, is incorrect in saying that this was ignored. Accordingly, the Government do not accept that there has been a failure to comply with the 1946 Act.
The joint committee has noted in its opinion that the reasons contained in the notification were not adequate and did not show why it was essential to bring the regulations into operation so quickly. As I have already explained, my right honourable friend considered it essential that the regulations be brought into force as soon as possible after they were made in order that the legal ground on which the education committee might be taking its decisions should be immediately established.
Another point was raised by the noble Lord, Lord Carmichael of Kelvingrove, in relation to the meaning of one part of the regulations. Again, I accept that is a criticism that is made by the joint committee in that the regulations, as it says, do not make it clear who or what authority is to be responsible for decision on the capacity of a school and for ensuring that the criteria mentioned are taken into account for the purpose of deciding when a closure decision must be referred to the Secretary of State.
The terms of Section 22B of the Education (Scotland) Act 1980 and the context of Schedule 2 to the principal regulations make it perfectly clear that the duty rests with the education authorities to decide which proposals to put before the Secretary of State for his consent. Section 22B requires an education authority to submit for consent any of its proposals of a kind prescribed for the purpose by the Secretary of State.
For instance, the existing regulations prescribing proposals which require the consent of the Secretary of State do not deem it necessary to state who is to decide whether or not a school is five or ten miles distant. It may appear on the face of it to be an objective measure not open to dispute, but as a matter of fact and practical experience in measuring distances between school an education authority has to make a judgment as to what is a reasonable route in all the circumstances. In the same way, and in the same context, in relation to a pupil travelling a distance of five or ten miles or more measured by the nearest available route, it is again a subjective measure.
It has been suggested that the criteria in the regulations to determine the capacity of a school are not clear. We believe that the criteria are quite clear enough to enable an education authority to make a reasonable judgment. Obviously, absolute and

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objective precision in measuring a school's capacity is impossible. The actual capacity of a school will depend on such matters as the structure of the curriculum, the teaching methods employed, and any upper limits in the class sizes which were agreed in the teachers' condition of service. The fact that there is no unchanging, objective yardstick for measuring capacity does not mean that no measurement can be made. That would be absurd. Education authorities can and do make reasonable judgments of school capacity. It is on these reasonable judgments that the operation of these regulations depends.
Take the first criterion. That means that the education authority must make reasonable assessment of capacity.
A reasonable education authority will call for a report from its professional advisers, the director of education and his staff, on a matter of this kind. Any director of education can give an assessment of the working capacity of a given school. He will take into account the extent and condition of the buildings, the range of subjects offered in the curriculum, the maximum sizes of classes and so forth and on that basis he can advise the education committee on how many pupils the school can take. Indeed I am advised that the Strathclyde region had published figures for all schools before these regulations were laid showing that in at least on case one school was more than 100 per cent. full, so the calculation can be made. I am advised in passing that the school was Paisley grammar school.
In these regulations my right honourable friend the Secretary of State quite clearly made known his view that education authorities should simply not have the last word over the future of a school which is able to operate at or near full capacity. He has done so by bringing these regulations into effect in time so that the Strathclyde Education Committee could take and were bound to take any decision in the fullest knowledge of them. That is proper notice properly given. It was essential that it be so.
I therefore make clear that in this case the circumstances to which the joint committee has drawn attention are not, in the Government's view, well founded. In the Government's view the requirements of Section 4 of the 1946 Act were fully met and in particular the proviso was met.
Lord Morton of Shuna: My Lords, before the noble and learned Lord sits down, perhaps he could answer this question which he does not appear to have answered at all. Why was it essential in the terms of Section 4 of the 1946 Act that this order came into force on 27th January and not on 2nd February? That is one question which has not been answered. There has been a misconception about the 21-day rule, but the basic issue, according to Section 4 of the Act, is that the order comes into force before it is laid before Parliament. Secondly, why were the noble and learned Lord the Lord Chancellor and the Speaker of the House not informed of the reasons why it was thought to be essential? Those are the points that I have tried to raise and those are the points that the noble and learned Lord has not, I regret, answered.
Lord Cameron of Lochbroom: My Lords, I take it that I had not sat down. I have made the matter perfectly plain and I can go no further than that.
Lord Mackie of Benshie: My Lords, before the noble and learned Lord sits down again, I wonder whether he will tell me in plain language whether the decision, the real reason for laying the regulations, was simply that his right honourable friend the Secretary of State disagreed with the decision he thought the authority was going to take? In other words, he simply did not trust the local authority?
Lord Cameron of Lochbroom: My Lords, in effect, with leave of the House, I wish to make it clear that I am answering the Question as put down this evening. I have made quite clear that these were matters debated on an earlier occasion.
House adjourned at a quarter past eleven o'clock.