My Lords, Clause 13 makes it a criminal offence intentionally to copy a UK or EU-registered design in the course of business without the consent of its owner. It will also be an offence to try to profit from the use of the copy in the course of business. This clause has attracted much debate, both here and in the other place. My right honourable friend David Willetts and I have also had extensive discussions with industry representatives, and I have listened carefully to the views of both large and small design businesses.
A number of industry representatives voiced serious concerns that the drafting of the clause left some uncertainty as to the scope of the sanction. They believed that the clause could be interpreted more widely than the Government intended—a view supported by members of the judiciary. As a result, the Government made two sets of amendments to this clause in the other place to clarify the scope of the sanction, and therefore strengthen its effectiveness. The Government recognise the importance of creating certainty for those businesses that may be affected by the criminal sanction.
Amendments 4, 6, 8, 11 and 12 insert the word “intentionally” into the clause to make it absolutely clear that unconscious and accidental copying should not be caught by the offence. These amendments are not intended to make the offence harder to prove, but simply to clarify that the offence should apply only to intentional copying. It has always been the Government’s aim to create an offence that deters specific, purposeful copying, as can be seen from previous debates in this House. I do not believe that inserting the word “intentionally” into the statute changes this underlying aim.
I now turn to Commons Amendments 5, 7, 9 and 10. These amendments concern the scope of the offence, in the context of assessing whether one design has been copied from another. The amendments replace the word “substantially” in the clause with the phrase,
“with features that differ only in immaterial details”.
I will take just a moment to remind noble Lords that the intention of this criminal sanction has always been to cover exact copies, and copies where the design has been very slightly altered. In achieving this policy aim, the Government have been mindful not to capture the type of differences that can quite legitimately result in the creation of a new design. The amendments help achieve this, so that when making an assessment of whether a design has been copied, immaterial details may be disregarded. It is right that what amounts to “immaterial details” should be determined by the courts in the light of the details of the case in front of them.
The decision to replace the word “substantially” arose from detailed discussions with industry representatives. They expressed concern that the term was not clearly defined in registered design law and could therefore create uncertainty, which in turn could affect legitimate follow-on design. The revised form of wording—“immaterial details”—is more familiar to industry and reflects existing language in the Registered Designs Act 1949, in the context of deciding whether a design is new. By definition, a new design cannot be a copy. The wording provides users not only with a familiar term but gives the courts a more precise test than “substantially”.
These amendments will help remove uncertainty in the criminal sanction that could impact negatively on innovation, but the new wording also reinforces the important point that someone who intentionally copies another person’s registered design will not be excused simply because they have made some immaterial changes to that design.
To conclude, both sets of amendments made by the Government to Clause 13 will help clarify the scope of the offence and give industry the certainty it needs to allow follow-on innovation to continue without fear of crossing the line. I beg to move.