The Hargreaves Review released today (18 May 2011) appears to be careful and balanced; its conclusions are unlikely to frighten rights-owners while managing to identify a number of areas where IP rights and their management can be improved. In its proposal for a Digital Rights Exchange to be based in the UK it also has one big new idea.

Most of the people who are affected by the Review, whether creators, owners or users of rights will find things to quibble with. Some of its proposals are not feasible, or are not much more than good intentions. It is also determinedly non radical, which will disappoint some who expected big immediate changes. But it is important to remember that this is a prospectus, which lays out what should be looked at, but still with plenty of scope for detailed policy consideration and argument. The Review's approach recognises that simplistic broad strokes are difficult to make in the complex and interconnected world of IP.

The government face the most challenges from the Review, as Professor Hargreaves repeatedly makes the point that the changes he advocates have to be brought about through serious governmental effort and application. This may not have been what the government were hoping for and much of this work will be costly.

When David Cameron set the Review up he highlighted many of the potential benefits he anticipated from introducing a fair use right. Cynics suspected in this an attempt to appear pro innovation without the government having to do much, such as tax breaks to assist innovation. As plenty of commentators said at the time, EU law would not allow a right of fair use. Hargreaves has echoed that and dismissed the possibility. Instead he has listened and listed a large number of less radical changes the government must consider. He also advocates a more limited exception, where the use does not trade on the creative expression in the work.

The changes he suggests to basic copyright law are relatively minor. The suggestion of a format shifting right was widely predicted, not least as the previous government had said it would introduce such an exception in 2006, but never managed to do so. A parody right is also given another outing despite having recently been considered in detail by a government review and rejected. Perhaps the most important idea is that the UK should introduce the same exceptions to copyright as the rest of the EU. Bringing our law more into line internationally is worth considering. From the perspective of important trading partners such as the US and the EU, much about UK copyright law seems odd and out of step, and this costs us.

Many of the Review's suggestions are around copyright licensing, and making the system more transparent, predictable and speedy. This includes around orphan works, of collections and for all digital works. As the report acknowledges, the idea of a digital copyright exchange is not new, though Hargreaves' support may help one come about. What is new is his idea that the UK should become the global hub for this. It will be interesting to see whether the government can actually do anything here, other than encourage existing negotiations to continue.

There are good ideas in other areas, such as the often overlooked field of design protection, where the laws are an impenetrable thicket and do little to help anyone. The idea of a small claims IP court is also a good one. Even for large companies UK litigation is expensive, especially compared with Germany which has more sensible answers to many IP issues.

Finally, the report recognises that many of the problems with UK IP law come from not having anyone in government sufficiently engaged with it. While he stops short of criticising those who commissioned the report, he makes strong recommendations for a much more muscular, policy-leading approach from the Intellectual Property Office.

Will the Review end up making any difference? The Gowers Review of IP from 2006 provides a salutary lesson. It was also well-written and thought out, with many interesting proposals. Some of the easier ones were implemented but plenty were ignored. Hopefully this time the government will do more and will learn from the Gowers experience, so we are not having yet another trumpeted review of IP in 5 years time.

The report can be accessed here, and we will provide further comment as the outcomes of the Review progress.

18 May 2011

Author: Mark Owen, Partner in the Intellectual Property Practice.