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Digital Economy Bill [HL]

Volume 717: debated on Monday 8 February 2010

Committee (7th Day)

Clause 31 : Renewal of national radio licences

Debate on whether Clause 31 should stand part of the Bill.

My Lords, before I propose that the clause not stand part, I must apologise. As a result of the way in which the business of the House has been organised today, I shall not be able to be here for about two hours of the Committee’s proceedings. I very much regret that, as many important matters remain to be debated. However, since the business was switched at extremely short notice—I hope that the Whips are whipped for it in some future incarnation—

I am of course not referring to the noble Lord, Lord Davies. Moving this business from Tuesday to Monday at very short notice is not a happy situation. I therefore hope that Ministers will give full and frank responses as if I were present. I am very grateful to my noble friend Lord Addington, who has kindly agreed to step into the breach when I am not able to put the arguments.

I propose that Clause 31 should not stand part. Under this clause, the national analogue radio stations talkSPORT, Classic FM and Absolute Radio are receiving valuable seven-year extensions to their licences. In exchange, the existing licensees have been asked to give their support to an early switchover, with the proposed 2015 date coming much earlier than that recommended by the Government’s 2008 Digital Radio Working Group.

However, there is a view among some operators that extensions to these licences are not worth the damage to radio of a digital switchover policy which assumes an unrealistic timetable for digital switchover and which fails to provide solutions that allow all local radio stations to move to digital. They do not accept that as a reasonable quid pro quo for an early switchover. They believe, on the contrary, that the industry’s engagement with the digital radio switchover proposal has been distorted by its interest in licence extensions which are essentially to do with the attractiveness of the current analogue model for radio rather than the proposed digital model. Their view is that Clause 31 will deprive the Government of revenue due from re-auctioning the licences for these national analogue stations. However, the Government have failed to publish an assessment of how much revenue will be lost to the Treasury under this approach.

The Government need to justify the advantage of the clause against the background of the following factors: that the sums lost to the Treasury will clearly amount to tens of millions of pounds over the lifetime of the extended licences; and the lack of evidence about whether digital investment by the holders of these licences will continue without the extensions. On the face of it, many are already contractually or otherwise committed to digital even without this.

My Lords, although I share a number of the noble Lord’s concerns, I do not think that removing the clause would be helpful. It is a facilitating clause that enables the move to switchover at a later date, and it does not set in stone when the switchover will take place or indeed that it must happen. It is more important that the Secretary of State considers a range of issues before nominating a switchover date than that the process in its entirety is stopped. I believe that the level of digital radio listening should be much higher than the Government have suggested. It would also be very much better if the fact that the FM spectrum will remain in use for local and community radio stations was on the face of the Bill. More progress should be made in creating a help scheme and a recycling scheme. We should be focusing on these issues rather than on an attempt to derail the digital switchover process completely.

My Lords, I recall that last week the noble Lord, Lord Clement-Jones, and I supported each other’s amendments, but sadly that relationship is about to be broken albeit, I hope, temporarily. To allow the Bill to pass without this clause would pose a real problem for the entire digital radio project.

The three commercial stations currently granted national analogue licences cater for a broad range of tastes, from Beethoven and Brahms to Bon Jovi, via the latest soccer score from Bolton Wanderers. Their collective appeal has been vital to encouraging digital take-up by listeners, with around a fifth of their current audiences now listening via a digital platform. To disrupt that migration would be rather unwise.

Readvertising these national licences with just a few years to run before we expect to switch off the service seems to be sending the wrong signal to both the industry and to listeners. It seems to suggest that we are not fully committed to digital as the future, that we doubt whether we will be in a position to switch over the bulk of national stations in seven years, and that we can expend less energy on the steps that are undoubtedly still needed to get listeners to switch to digital, especially through pushing down the cost of DAB radio sets and through getting DAB into more cars as standard. I do not think that any of those things are the right course.

If, as I understand it, the message from the legislature to the private sector is to be, “We want you to invest in this new technology, market it to your listeners and encourage them to adopt the new listening platforms”, surely we cannot keep expecting these companies to keep on writing blank cheques.

We all appreciate that digital platforms are still in their relatively early days. It has to be remembered that not one digital radio station has yet posted a profit. For their pioneering endeavours, they deserve the stability that this reprieve offers them. One does not often hear pleas for breaks for business from these Benches, but this is a case of tidying up the licensing regime to make it serve the purposes of the digital age.

My Lords, I declare an interest as chair of the consumer panel of Classic FM. This panel is entirely independent of the company. It is devoted to maintaining the standards of Classic FM and the widespread broadcasting of classical music by the independent sector. If this clause does not stand part of the Bill, your Lordships should be aware that the future of Classic FM will be severely compromised because it is a requirement of existing law that the analogue licences are auctioned. As at present conceived, analogue licences do not have a clear format specification. There is not a licence for classical music. There is simply a licence for non-speech, which is the licence held by Classic FM.

If these national stations were to be auctioned in the near future, I would be willing to bet the noble Lord who is opposing that Clause 31 shall stand part of the Bill at least a bottle of claret that this licence would be secured by a pop music station, and that Classic FM would disappear. I wonder whether the noble Lord has taken into account that possibility in his proposal.

My Lords, key to supporting the drive to digital is to encourage and to allow broadcasters to invest in their digital futures. Experience shows that licence renewals, which are linked to the provision of a digital service, are a key incentive. At a time when the Government are asking the industry to contribute to a focused and intense drive towards digital, we believe that it would be wrong to remove this incentive.

Clause 31, alongside Clause 32, would allow Ofcom to grant a further renewal period of up to seven years to analogue licence holders which also provide a digital service. Clause 31 relates specifically to the national analogue licences, although the rationale for the decision for extending the renewal is identical for both national and local licences.

I do not want to take up too much time because noble Lords who have contributed to this debate have put many of the arguments excellently. The noble Lord, Lord Howard, talked about the necessity to maintain the clause. The right reverend Prelate displayed a very catholic—I hope he does not mind me using the word—taste in music from Beethoven to Bon Jovi, which I liked. In his analysis of the need for Clause 31, he is absolutely right. As he said, we cannot expect companies to carry on writing blank cheques. We need to give them an incentive. My noble friend Lord Eatwell’s analysis of Classic FM was exceedingly apposite. We believe that this clause is essential for the reasons stated by a number of noble Lords. In those circumstances, I support the clause standing part of the Bill.

My Lords, I thank the Minister for that reply. I also thank other noble Lords for contributing to the debate with some fairly bloodcurdling prospects. However, I do not think that the Minister has answered the question about why these extensions are required. I put this proposal somewhat as a devil’s advocate. By and large, I believe that the majority of the radio industry is behind the scheme as put forward by the Government, but there is a significant minority of interest which is not. That is why I put forward the clause stand part debate. But if I were in their shoes, listening to what the Minister had to say, I would consider that his arguments were entirely circular and that the Government have done this because they needed to and that this was the best way forward. I do not think that any real forensic argument has been put forward by the Minister. I could probably put forward rather better arguments than the Minister has. I certainly could have put my finger on areas where investment is needed, since I have been briefed by some of the major radio players.

The Minister has been extremely half-hearted in responding. This is the one bit of this Bill which is the Government’s opportunity to set out their stall in terms of their digital radio policy, other than the amendments we have already dealt with. We had quite a useful debate on our last Committee day, but the Minister has not really answered the questions in a robust way. Certainly, he has not set out the stall for the Government’s policy in terms of the extensions of these national analogue radio stations. We are talking about digital radio switchover. What is it about these extensions that will make those radio stations invest more when they migrate to digital? That is what it is all about.

The Minister did not even attempt to talk about the amount of money that the Treasury would forgo. Some estimates have put that as high as £73 million, which is a large amount of money. I do not think that the Minister dealt with that either. The Minister has been extremely disappointing. I do not think that that minority of radio stations will be particularly happy to hear the Minister’s lack of engagement with their arguments. It is almost as if he has taken a view that only a minority of radio stations is concerned, that the bulk of the radio industry is quite happy and that therefore that minority will be overridden without so much as a by your leave.

That is an unfortunate position to be in. This House, above all, is about rational debate and about putting forward the arguments. To be frank, in previous amendments to this clause, the Minister put forward some useful points—he certainly did in response to some of mine—but when I have tried to elicit an overarching policy, he has been lacking and I have been somewhat disappointed.

Clause 31 agreed.

Clause 32 agreed.

Amendment 241B not moved.

Clauses 33 and 34 agreed.

Clause 35 : Local radio multiplex services: frequency and licensed area

Amendment 241C

Moved by

241C: Clause 35, page 39, line 3, leave out “local”

My Lords, this amendment, which relates to the provisions for digital radio, seeks to allow for the efficient use of the radio spectrum and for a potential increase in radio listening choice for the people of Northern Ireland. Although national BBC services are available via digital radio in all four parts of the United Kingdom, the national commercial multiplex is unavailable in Northern Ireland. The reasons for that are historical and technical, and relate to how the same frequencies were used in the Republic of Ireland. The result is that stations, including Absolute Radio, Planet Rock, BFBS radio and Premier Christian Radio, cannot be heard digitally in Northern Ireland. There is some hope that the spectrum position will change. However, as currently worded, even if that spectrum were to become available, Ofcom would not have the powers to allow it to be used by the national commercial multiplex.

That is clearly an anomaly and, I suspect, an oversight. It would result in the inefficient use of spectrum and an artificial restriction on the radio-listening choice for some citizens. This amendment seeks to correct the situation and, without obliging, would enable Ofcom to increase the coverage of the national commercial multiplex. Were this to become technically possible, Ofcom would follow the process already proposed for similar expansion of local digital radio or multiplexes using the framework already in the Bill. This amendment, while modest and not contentious, will have benefits for the people of Northern Ireland and clearly will be welcomed by the radio industry, so I hope that the Government will be prepared to accept it. I beg to move.

My Lords, this amendment would allow Ofcom to vary the frequency or licensed area of national, as well as local, radio multiplex licences. On the face of it, this is not an unreasonable change and would potentially enable the national commercial radio multiplex to extend its coverage to Northern Ireland. However, Clause 35 was structured specifically with reference to local radio multiplexes so as to allow them to merge or be extended in order to close the gaps in local radio multiplex coverage in the UK not currently served by DAB. Simply removing the word “local” from the text may not be the best way to achieve the desired result. Consideration needs to be given to what variation powers Ofcom should have with regard to national multiplex licences and to the basis on which such powers should be exercised. We have some sympathy with what the noble Baroness is trying to achieve and the Government will consider this issue before Report. With that assurance, I hope that the noble Baroness will feel able to withdraw the amendment.

My Lords, I am pleased to hear that, even if this amendment is not entirely appropriate according to the Minister, serious consideration is going to be given to how this can be made possible. Under those circumstances, I beg leave to withdraw.

Amendment 241C withdrawn.

Amendments 241D to 241F not moved.

Clause 35 agreed.

Clause 36 : Renewal of radio multiplex licences

Debate on whether Clause 36 should stand part of the Bill.

My Lords, Clause 36 deals with the renewal of radio multiplex licences and it inserts a new Section 58A after Section 58 of the Broadcasting Act 1996. The House of Lords Delegated Powers and Regulatory Reform Committee, which we always listen to with some respect, had some interesting words to say about this clause:

“It is impossible to tell from the Bill whether the policy is that the licences should or should not be renewable at all, let alone for what period or on what grounds. Indeed, paragraph 56 of the memorandum candidly admits that the relevant policy decision has yet to be made. We draw attention to the skeletal nature of the power in clause 36, to enable the House to examine it further and determine whether it is justifiable in this context”.

I am merely a humble hand maiden of this House in tabling this clause stand part debate, and I hope that the Minister can give us further enlightenment.

I have never had to respond to a hand maiden before in this House. I am still wrestling with that analogy. The Government stated in the Digital Britain White Paper that we would work with the industry to agree a plan to build out the DAB infrastructure to current FM coverage. We recognise the need to limit as much as possible the impact of such build-out on radio stations. One way this can be achieved is to allow multiplex operators to spread the cost of the investment in the new infrastructure by extending the period of their licence. We have suggested that licences could be extended up to 2030.

The renewal of multiplex licences as a means to support digital radio was first introduced in the Broadcasting Act 1996. However, these renewal powers only apply to licences which were granted within 10 years of the 1996 Act coming into force. Therefore, there are a number of multiplex licences which are currently not eligible for a renewal. If renewals are to provide a real support to the build-out of DAB coverage to FM levels, they need the flexibility to achieve three objectives: first, to allow the extension of the licence period for those licences which are already eligible for, and in some cases have already been awarded, a renewal under the existing terms; secondly, to allow the renewal to apply to all multiplex licences, including those not currently eligible within the existing provisions; and thirdly, to ensure that any further renewals are awarded with conditions which link them to the progress to digital radio switchover, and more specifically to an agreed build-out plan and timetable.

The link to a DAB coverage plan for switchover, which is likely to take a year to agree, is why we believe these powers are most appropriately applied via an affirmative order. I note concerns about the breadth of the order-making powers and I hope that I have satisfied noble Lords that they are justified because of the range of changes needed to implement this policy.

I thank the Minister for that brief but—I hope to discover on reading Hansard—informative statement. As somebody who is not fully conversant with the radio multiplex licence variations, that was not the clearest possible answer I could have asked for. I hope that it will make sense on further consideration. It seemed to tell me that the Government need the maximum possible flexibility without having determined exactly which licences require extension. I am not sure that takes us a great deal further than what the House of Lords Delegated Powers and Regulatory Reform Committee said, but perhaps, as I say, on reading Hansard it will all become blindingly obvious.

Clause 36 agreed.

Clause 37 agreed.

Clause 38 : Payment for licences

Debate on whether Clause 38 should stand part of the Bill.

My Lords, I feel somewhat like the Ancient Mariner at this part of the Bill. I am hoping that the Minister will give me a better reply than he has to previous clause stand part debates. The purpose behind this clause stand part debate is to ensure that the Government put on the record their spectrum policy to deliver 4G mobile telecoms and set out their key objectives. Consultations are currently taking place on the report by the Independent Spectrum Broker, Kip Meek. He clearly has tried to reconcile a number of interests within the confines of his brief from Government. A key assumption underlying his conclusions was that there is adequate competition in the mobile market. Are the ISB’s conclusions still valid now in the light of the reduction in the number of mobile operators through the merger of T-Mobile and Orange? The Government have acknowledged this to a degree in their extension of the consultation period.

Will there be an adequate portfolio of spectrum between the various competitors as a result of an auction process for the 800 megahertz freed up by analogue TV switchover—the so-called digital dividend—and the currently unused 2.6 gigahertz spectrum? This is one of the key questions. Will the proposals really have the maximum possible effect in terms of promoting competition in the mobile sector, as claimed by the impact assessment? Why is there no proposed special provision for new entrants as there was when the 2.1 gigahertz spectrum was auctioned? Does this not mean that the auction process is essentially a closed one, confined to existing operators? Why auction the 800 megahertz at the same time as the 2.6 gigahertz? Why not auction the former before the 800 megahertz is freed up from digital TV switchover? Why deal with our spectrum wholly separately from the process on the continent? Should we not be looking at this on a pan-European basis?

Are the emergency channels properly dealt with? Will there be adequate free spectrum for the Olympics, as the Government guaranteed in their bid? Save Our Sound highlighted the problems faced by the programme-making and special events sector, where a whole range of wireless radio microphones and similar equipment will be rendered obsolete by the auction of the 800 megahertz spectrum. The Government made reference to the issue in the Digital Britain White Paper, but what concrete proposals are there now by Government to meet their costs of enforced migration from 800 megahertz, which will add up to tens of millions of pounds? What justification is there to extend the 2.1 gigahertz 3G licences? Is that really necessary to stimulate further investment? Why have the expected financial benefits not yet been quantified in the impact assessment for the Bill? Will the annual licence fee, the administrative incentive pricing arrangement, be charged and will those charges reflect the true value of the use of the spectrum after 2021? What assurances will there be that the spectrum-trading model envisaged will actually work, when it has not worked so far?

What the Government propose is complicated, but some want to unpick it. BT, for example, may take legal action via judicial review. What view have the Government taken on its chances of success? The Government need to articulate very clearly why their proposals are necessary to deliver next-generation mobile and why the provisions in Clause 38 are required to implement them.

My Lords, Clause 38 is intended to support the Government’s proposals to achieve the spectrum modernisation programme set out in the Digital Britain report. I am having trouble with the noble Lord’s transformation from handmaiden to ancient mariner; that is a terrible ageing process in the space of a few minutes.

The proposals, recommended by the independent spectrum broker, have been developed with the objective of enabling the early release of significant amounts of new spectrum into the market, offering the opportunity for existing operators and new entrants to acquire sufficient spectrum holdings that will allow them to deploy next-generation wireless networks, delivering high-speed mobile broadband services to businesses and consumers. An example of the licences that could be affected by the changes enabled by this clause are 3G licences which were auctioned in 2000 and are due to expire in 2021. The Government propose to direct Ofcom to make these licences indefinite, but that annual licence charges will be applied from 2021. The Government believe that this is an appropriate step to take.

Further investment is required in 3G networks, but with the licences due to expire in 2021, operators face a difficult decision at a time when capital expenditure budgets are under pressure. By making the licences indefinite, the operators can invest with greater certainty and confidence, to the benefit of consumers and businesses alike.

Some have argued that we are giving these licences away. This is not the case. The intention is to apply annual licence fees to these licences from 2021, which will reflect full market value. The amount of the charges will be set by Ofcom at the appropriate time. Of course, they will be required to exploit the spectrum that they have efficiently and effectively. At the moment, we have only one remedy—to remove the licence. We think that this gives us more flexibility.

On the specific question of the Olympics, I can guarantee that a suitable spectrum has been identified and will be available for the Olympics. I am pretty sure that the same guarantee could be assured for emergency services as well.

The noble Lord, Lord Clement-Jones, mentioned BT being somewhat upset about these arrangements and threatening judicial review. Has the Minister considered whether the Bill is as robust as it can be in relation to that threat?

We were certainly aware of BT’s intention. If BT wishes to challenge it, we believe that it is a fair and effective process. I understand from the affirmative nod from the Box that the answer is that, yes, it is robust.

My Lords, I thank the Minister for that reply, but he barely touched the surface of the policy. I hope that he has read the independent spectrum progress report; it is the subject of consultation, which has been extended because of the Government’s concern about the merger of Orange and T-Mobile affecting the competitive situation. I do not think that the Minister used the word “competition” in his answer to me. What is the Government’s view about the new element introduced by the merger of T-Mobile and Orange? Has it affected the spectrum broker’s recommendations? Do the Government still believe that their package is viable in the face of going down from five operators to four?

Whether the joint venture between Orange and T-Mobile takes place is a matter for the relevant competition authorities. Whatever decision they arrive at will need to be accommodated within our proposals for the spectrum modernisation programme.

My Lords, that is an extraordinary answer. The Government are making policy on the basis of certain assumptions. The Minister is telling me that that is in the hands of the competition authority; of course it is, in terms of the commercial practices of those particular mobile operators. However, I asked whether the Government’s assumption about the level of competition in the mobile sector still stood, so that there would be a proper portfolio of spectrum available to keep competition within the mobile sector. The auctioning of the 800 megahertz and 2.6 gigahertz is going to have a considerable impact on the mobile operators’ ability to deliver fourth-generation mobile.

In the opening part of my contribution I did specifically refer to the point that the noble Lord made when I said that the proposals recommended by the Independent Spectrum Broker have been developed with the objective of enabling the early release of significant amounts of new spectrum into the market, offering the opportunity for existing operators and new entrants to acquire sufficient spectrum holdings that will allow them to deploy next-generation wireless networks, delivering high-speed mobile broadband services to businesses and consumers. I specifically addressed the point about new entrants and competition, and I wish that the noble Lord would perhaps pay a little more attention to what I am saying rather than criticise me for not giving answers.

My Lords, I was listening very carefully and I took note of exactly what the noble Lord said, but he did not say that five competitors moving down to four made any difference to the Government’s proposals. That was the point that I was making. Of course, he said that that was the Government’s belief, but he did not say whether the Government had changed their view as a result of changes in the number of mobile operators. The other aspect was the Save Our Sound campaign. There have been assurances from the Government, but it seems that there is nothing concrete yet to help it in terms of replacing all the equipment which currently uses the 800 megahertz spectrum, which it will have to deal with. I was listening carefully to what the Minister had to say—but again, if I have misinterpreted the Minister, I apologise. I think that I have been listening pretty carefully, and I certainly did not hear the Minister say anything of that sort or anything about whether spectrum should be dealt with on a European-wide basis. That seems a rather important point. I do not know whether the Minister has any crumbs of comfort or scraps of paper or anything else that he cares to deliver in these circumstances. He shakes his head, so clearly not. We shall just have to wait until Report for further enlightenment.

Clause 38 agreed.

Clause 39 : Enforcement of licence terms etc

Amendment 242

Moved by

242: Clause 39, page 42, line 38, at end insert—

“( ) In section 400 of the Communications Act 2003 (destination of licence fees and penalties), in subsection (1)(d), after “42” insert “or 43A”.”

This government amendment rectifies an omission in the Bill.

Clause 39 of the Bill inserts proposed new Section 43A into the Communications Act 2003, giving Ofcom a new power to impose financial penalties in certain circumstances. This technical amendment adds a reference to the penalties imposed under new Section 43A to Section 400 of the Communications Act 2003. Section 400 requires specified licence fees and penalties paid by operators to be paid into the Consolidated Fund. This amendment therefore ensures that any such penalties are dealt with in a consistent fashion to other amounts and penalties paid to Ofcom. I beg to move.

Amendment 242 agreed.

Clause 39, as amended, agreed.

Amendment 243

Moved by

243: After Clause 39, insert the following new Clause—

“Electromagnetic spectrum: access for European emergency service

(1) OFCOM must set aside a spectrum band or bands amounting to not less than 15 MHz in total and lying within that part of the spectrum that is expected, under Council recommendation 10141/09 or subsequent proposals, to be agreed upon for the extension of European emergency service access.

(2) OFCOM may not release any of the spectrum so set aside unless it sets aside equivalent spectrum, or determines after due consultation that the emergency services have no reasonable likelihood of requiring the spectrum to be released.”

My Lords, this amendment picks up a point raised minutes earlier by the noble Lord, Lord Clement-Jones, and not replied to by the Minister: what are we doing to protect the interests of the emergency services, and our national interests, when it comes to allocating spectrum for them? This has two prongs to its attack.

It is clear that the emergency services will, over time, require substantial additional spectrum. I have put in 15 megahertz here just as an illustration of the magnitude of the requirement. Although the current emergency services systems are generally operating well, if near capacity—there have been points in recent times when that has got very close—they were designed 10 years ago. All of us, even those with parliamentary communication systems, are operating at a much more advanced level than the emergency services are able to.

If, as I think is inevitable, we give the emergency services the ability to use streaming video—so that the situation on the ground could be immediately communicated to the centre by the constable on the beat, or so that that constable could see immediately the recipe required to free a person from an obstacle or deal with a situation, as would be common on commercial networks that have to deal with such situations—we will require substantial additional spectrum to handle it.

If we are going to do that, there is great advantage in harmonising that spectrum across Europe. We achieved this with the current system, and greatly to our benefit. There have been two benefits. One is that because the system operates at common frequencies the kit is much less expensive. Secondly, by being an early adopter of the system, we have been able to take a very large share of the equipment manufacture market for the current system as it is spread out worldwide. It has been a great benefit to us in both those ways.

We now appear to be in a situation where a harmonisation process is under way in Europe for future emergency services spectrum. The noble Lord, Lord West, has very sensibly signed up to it on behalf of the Home Office, but Ofcom is doing its best to derail it, because it thinks that it can sell the bit of spectrum that Europe is looking at for more money. That is an extremely short-sighted view. Ofcom may get a bit more money for it now, but it will cost us a great deal more in the future both in terms of the cost of our kit and in terms of lost markets.

In this amendment, I am asking that this bit of the Government sign up as the other bit of the Government has. In other words, I ask that we are wholeheartedly part of the European co-operation on finding common spectrum for the next generation of emergency services’ kit, so that we benefit, or have a very good chance of benefiting, as we have from the current system. I beg to move.

Amendment 244 (to Amendment 243)

Moved by

244: After Clause 39, line 3, leave out “amounting to” and insert “commensurate with the requirements of the UK critical national infrastructure in addition to spectrum”

My Lords, the noble Lord, Lord Lucas, has made some very useful points. I must confess that the reason why we tabled amendments to the noble Lord’s amendment—which I am sure is fully formed and perfect—is lost in the mists of time. Nevertheless, a more general statement would be appropriate in the Bill, rather than something this specific about the actual use of parts of the spectrum; I suspect that was our motive in tabling these two amendments. They are all about the critical infrastructure.

In debating the Bill, we need to consider the public benefit of reserving a small amount of radio spectrum for use by the critical infrastructure, which is crucial to our well-being, compared to the incremental benefit of using this spectrum to provide more entertainment services and marginally quicker broadband communications.

Thirteen years ago, during the passage of the Wireless Telegraphy Act 1998, which introduced the concept of spectrum trading to the UK, the Government gave the assurance that,

“it is not our intention that the introduction of spectrum pricing should affect the access of utilities to the radio spectrum that they require”.—[Official Report, 8/7/97; col. 559.]

Similar commitments have been made on subsequent occasions, and these should be honoured in the Bill to safeguard the operation of gas and electricity networks specifically.

As we move to a more interconnected society based around communications technology, the interdependence of the underlying electricity networks and communications must not be overlooked. It is not in the consumer’s or citizen’s interest for the integrity of the electricity supply network to be compromised by the lack of resilient communications infrastructure.

I have received a considerable number of briefings, all in language that I am sure the noble Lord, Lord Lucas, will understand, but I confess that I do not—particularly in terms of the emergency infrastructure. I hope the Government have taken all these matters into account, and that they can reply to say that they have done so. I beg to move.

My Lords, in listening to what noble Lords have said, I have been rather attracted by the arguments put forward, not least by the idea that we should perhaps go down the line advocated by the noble Lord, Lord Lucas, towards European spectrum.

We all know that there are too many, if not vast, areas where reception is appalling, about which one is currently very concerned, and where the likelihood is that it will not be perfect for quite a while to come. We would be pretty worried about whether the emergency services, if needed in these areas, would be accessible via the facilities they have.

I am certainly no more capable of understanding the technologies of this, but I hope that even though, as has been admitted, we may not have got it right, sufficient attention will be given to this point. Even during the cold weather we had recently, there were examples where the emergency services could not be accessed. This needs to be taken very seriously.

My Lords, I rise to support the amendment of the noble Lord, Lord Lucas, plus the amendments to it, because they are slightly different things. Taken as a package, the whole thing, though not essential, would be extremely useful for the UK and possibly the world.

Nowadays, in a global society where more things are happening and there is more international assistance, it seems silly that teams who go abroad should not be able to interoperate to a certain extent. If we operate on completely different frequencies, the kit has no hope of interoperating. It might be possible—I do not know—to get stuff to interoperate if we, for instance, dispatched a team to Haiti. If other international teams were there, we might find that we could, whereas the kit will not interoperate if we are working on completely different frequencies. Therefore the idea of organising this at a European level, for a start, is extremely sensible.

There has been quite a lot of debate on this around the scenes for the past year or so. When it has been raised at meetings with various people from the Civil Service, the general attitude has been, “Well, the emergency services have to bid for their spectrum like everyone else, and if that is wanted they will be given the budget to do so”. What worries me is my suspicion that, with the current parlous state of the economy, they will not be given that budget. Because of a temporary crisis in our economy, we may well find ourselves regretting that in 10 or 15 years’ time—or even at the Olympics. If there were a disaster then, it would be far better if we were operating on the European frequency. If teams were there with similar equipment, we might find it easier to operate together.

The point about the critical national infrastructure is that that is different. It would not be regarded as being for the emergency services. Again, however, it is important that they have spectrum allocated to them. More and more control systems—for power stations, for the grid and for other things—are running over radio frequencies. Those systems are not running down just wires or cables. We must make sure that those services have frequencies reserved for them that cannot be interfered with and that will not interfere with other transmissions. They should be dedicated to them. I therefore support all of these amendments.

My Lords, the Government fully recognise the importance of access to spectrum for the emergency services. It is an essential tool, without which they would not be able to operate. The Government regard the safety and security of UK citizens as of paramount importance, and have consistently stated that spectrum management should pay due regard to that. The Government also note the additional amendments that would require spectrum to be set aside for critical national infrastructure.

It is important that we take account of the context within which these amendments are proposed. Spectrum is a finite resource; although technology advances have allowed greater use of the available spectrum, rising demand means increasing pressure on a fixed supply. Against this background, the Government commissioned an independent audit of spectrum by Professor Martin Cave in 2004, from which one recommendation was that any new spectrum requirements from the public sector should be met through the market. He recognised that that might not be possible in certain circumstances, so recommended that a process be established to determine whether an administrative allocation should be made. Government departments and their agencies act within this framework. Determining future spectrum requirements should be treated in the same way as any other resource.

I stress that the National Policing Improvement Agency is presently working on its future communications programme, part of which will address the emergency services’ future spectrum needs. There is no way that those needs will be overlooked or that we will in any way undermine them. We will therefore be in a better position to determine what spectrum is required, and in what band, once that work has been completed and thoroughly assessed.

The noble Lord, Lord Lucas, asked about Ofcom derailing. We certainly do not share that view. The noble Lord referred to Europe and to Council recommendation 10141/09. The recommendation states that when needed and justified, and taking account of national arrangements for distributing spectrum, member states should allocate additional frequencies at national level in a co-ordinated timeframe in co-operation with CEPT—the European Conference of Postal and Telecommunications Administrations. A working group has been established to look at possible spectrum requirements, and the UK will be fully involved. I note, however, that the recommendation clearly states that any requirement for spectrum should be based on an identified need and should be justified. The working group only recently met for the first time. How quickly it will carry out its tasks and what their outcome might be is unknown, so it is premature to determine at this stage any amount of spectrum that may or may not be required.

I think that we have already given an assurance on the Olympics. In response to the noble Earl, Lord Erroll, we can see the difficulties of dealing on a European level, never mind a global level. If we are serious in trying to ensure that we address the needs of the Olympics, we have to be aware of the timescales for achieving this kind of operation. I am not dismissing the need to do that; it is the time that it will take. On critical national infrastructure, at present there is no certainty on what, if any, spectrum might be required. It would therefore be inappropriate and inefficient to set aside spectrum for that purpose.

I repeat: the Government consider the safety and security of UK citizens—and, indeed, of the emergency services in executing their duties—to be of paramount importance. However, the Government’s view is that established mechanisms exist for assessing and, if necessary, allocating spectrum for the emergency services’ use. As I said, the National Policing Improvement Agency is already working on its future communications programme. I hope that, with those assurances, the noble Lord will feel capable of withdrawing the amendment.

Before my noble friend withdraws his amendment, I was very interested in what the Minister said about the National Policing Improvement Agency, which is of course for one emergency service. However, I draw his attention to the report on communication that has just come out from the Royal United Services Institute. It referred to the critical national infrastructure and said that communication between the emergency services is the issue as well.

I think that the Minister was implying that because one emergency service sees the situation as adequate, it is adequate. However, I strongly refer him to that report from RUSI. It makes a strong plea for a vastly improved situation between the emergency services and, indeed, with other authorities such as local authorities. I apologise for not having contributed to the debate before the Minister replied, but I had not realised how relevant reading the RUSI report would prove to be.

Perhaps I may reassure the noble Baroness that communications between the emergency services will be covered; I am getting an affirmative nod from the Box on that. If we can give any more explicit information on that we will communicate it in writing, because I share that point of view. We believe that it is covered and we will give her the detail on that. I agree with her that there would not be much point in the police examining their requirements if they did not also take into account the need to communicate with the fire and ambulance services and, perhaps in some circumstances, with local authorities, in cases of flooding or whatever. I take her point. We think it is covered, but we will be a bit more explicit in writing.

Unfortunately, such large departments very often do not necessarily look, in the remit of their reports, at all the issues regarding interoperability with the other emergency services et cetera. That was a police report and was therefore unlikely to try to take into account issues between, say, the fire and ambulance services and other such matters. I would have thought that, on the precautionary principle, it would be safer to reserve some of that spectrum and auction it later than to include it in the hotchpotch at the beginning. Once it has gone, it will be difficult to get it back. Therefore, it is much safer to hang onto it. Then, if the European ideal falls through, it can be auctioned later.

My Lords, I have already given assurances that the emergency services are working together and, as I said, we will give further details. We do not believe that reserving spectrum on an unidentified basis would be the right thing to do. We have always ensured that we have sufficient spectrum for the emergency services. That is still our intention and, as I said, we are involved in the working party in Europe. We believe that we have the necessary precautions and the right procedures to ensure that the emergency services are available to operate whatever requirements there may be. Once again, I hope that, with those assurances, the noble Lord will feel capable of withdrawing the amendment.

My Lords, I, for one—not being endowed with the technological knowledge that the noble Lord, Lord Lucas, and the noble Earl, Lord Erroll, clearly have—was strangely reassured by what the Minister said. The fact that he said we are doing this in conjunction with our European neighbours, I found doubly reassuring—a reassurance that he was not able to give me about the use of the rest of the spectrum. I do not know why he could not give me that assurance in previous answers. That we are making sure that the emergency spectrum is dealt with on a common basis with our European neighbours seems to be a good thing and is something that we should pursue perhaps in other areas of the use of spectrum.

I am not quite sure what the procedure is. I think that I should withdraw my amendment before the noble Lord, Lord Lucas, withdraws his, and so I shall do so.

Amendment 244 withdrawn.

My Lords, the noble Lord cannot withdraw my amendment. He can only withdraw his amendment to my amendment.

Amendment 245 not moved.

I am very sorry, Lord Chairman.

I was carefully parsing what the Minister said. I am of course comforted by what he said about the priority given to the needs of the emergency services. He said that we are involved with Europe. Yes, I know that we are involved in Europe. I was taken to task quite severely by Ofcom for saying that we were not. We are just not co-operating. We are not doing our best to reach a resolution on this. It is going back to the days I remember from my early engagement in politics under different management. There is a great difference between being involved in discussion and working to bring the discussion to a fruitful conclusion.

I would very much like to know that the Government are committed to the idea of identifying common spectrum that the emergency services might use in the future. It seems to be a very important concept with a lot of benefits for us. I would very much like to hear the Government say that, rather than just getting involved in discussions which—looking at past discussions on this subject and the contributions made to it from the direction of Ofcom—have been singularly unconstructive. It seems to be a piece of co-operation which we should be encouraging. If the noble Lord cannot reply to me now, I would very much like to have it in writing that we are actively seeking to get towards the agreed goal of a common spectrum allocation for future use by the emergency services.

I do not disapprove at all of the basis that the Government have laid out regarding how the emergency services and others should acquire spectrum in essentially a competitive situation where they have to justify their use of the spectrum. We have been terribly profligate with it in the past. The Ministry of Defence still sits on about a quarter of the entire spectrum, which is a little excessive to say the least. What matters here is timing. The police will certainly develop a strategy. However, there is no way that this Government, or any other Government, will allow them a budget for the next three, four or five years to put in a new system or to begin work on a new system. We will come through a period where public authorities will have to be extremely careful about their budgets.

In that period, under the rubric set out by this Government, the key bits of spectrum will have been flogged off to mobile telephone companies. That is the problem which I seek to address in this amendment. It is not about the principles of the way that the Government are going at it; it is about timing. Because the Government are waiting for things to happen that necessarily cannot happen for five or 10 years before they will allocate spectrum to the emergency services, the other provisions of the Bill will result in the key bits of spectrum—the bits which would have worked on a European or an international basis—having already been allocated to other services. That is what I seek to avoid.

I do not seek some unjustified allocation of spectrum. I am advocating that we should be properly careful to make sure that a longer term objective—a five or 10-year objective—is not sacrificed in the cause of a more immediate gain. I have not had the answer that I am looking for on that. I suspect that I shall need to return to this at a later stage of the Bill. For now, however, I will withdraw the amendment.

Things were going rather fast but I see that we have comfortably gone back to the old pace of 20-minute groupings on this Bill. I shall absent myself from the next section, not least because my noble friend’s amendment comes rather too close to my own school days for me to want to sit around and listen to it. I beg leave to withdraw the amendment.

Amendment 243 withdrawn.

Clause 40 : Classification of video games etc

Amendment 246

Moved by

246: Clause 40, page 43, line 9, at end insert—

“( ) In subsection (2)—

(a) in paragraph (b), for “mutilation or torture of, or other acts of gross” substitute “graphic”;(b) in paragraph (c), after “organs” insert “anus, breasts or buttocks”;(c) in paragraph (d)—(i) after “offences” insert—“(e) dangerous behaviour;(f) racist, homophobic or other discriminatory language”;(ii) after “paragraph (b)” insert “, (e) or (f)”.”

My Lords, I rise to move Amendment 246. This seeks to plug a loophole that the British Board of Film Classification and others feel remains in the legislation connected to the exemption awarded to certain video material. Indeed, I see that the names that have been added to the amendment are from across the political spectrum.

This exemption, set out in Section 2 of the Video Recordings Act 1984, to which Clause 40 relates, allows works to be exempted from classification if they are designed for educational purposes or are concerned with sport, religion or music, and do not depict, to a significant extent—and I paraphrase—sexual activity or gross violence. This threshold is very high, significantly higher than the threshold in non-exempted work. For example, it allows unsimulated, strong, bloody violence and the after effects of self-harm. It also includes topless lap-dancing, which is an activity the Government viewed as being equivalent to explicitly pornographic videos when dealt with in the Policing and Crime Act 2009.

We accept that there will always be a grey area in matters such as this. However, when many in the industry are voluntarily submitting exempted works for classification because they consider their material unsuitable for under-12s—even though it does not reach the threshold—there clearly is a problem. The Government appear to consider that there is sufficient legislation for using enforcement officers against such material, but we hear a different story from those same officers and agencies. The Government have also commented that the amendment would increase the regulatory burden. I cannot understand that argument. Certainly, more works might be subject to classification, but every individual work has to be assessed against a single threshold as it is, and that is not changing.

The Government also pray in aid the technical standards and regulations directive and the three-month consultation period. After our debates on Clause 17, I find that argument astounding. We would be more than happy to help draft a very precise power for the Secretary of State to take steps to ensure that the threshold for exempted video works is brought into step with that for non-exempted works.

Finally, let me briefly address the more specific arguments against my amendment. I appreciate that the wording is not sufficiently precise; the nudity must be more closely linked with sexual behaviour. The discriminatory behaviour needs to be more precisely defined, and so on.

However, the intention of my amendment is clear. We feel that the differences between exempted and non-exempted classes of video work are no longer sufficiently significant, and that steps must be taken to ensure that any loophole that allows unsuitable material to be completely unclassified is closed. I beg to move.

My Lords, as the noble Lord, Lord De Mauley, has said, I have added my name to this amendment. I am equally pleased that it has secured support from all round the Chamber. Your Lordships may recall that it is an issue which I first raised at Second Reading following a rather gruesome viewing of some of the material that is available, on the high street, totally exempt from classification.

As has already been stated, the amendment seeks to update the current Video Recordings Act which currently allows too wide an exemption for music, sports and documentary videos. The exemption may have been appropriate in 1984 but appears out of date and naïve now. Most of us would expect boundaries to have been pushed to their absolute limits, and that is what has happened. The standards in the current Act relating to gross violence and actual sexual activity are way too high for successful prosecutions to take place, as the noble Lord said. I think the Minister in the other place suggested that prosecutions can already take place under the VRA. Indeed they can, but they rarely do so simply because the standard is set too high.

The music and sports videos that a number of us have seen do not contain anything as strong as gross violence or actual sexual activity, but do contain graphic violence such as close-up hits to the head, with commentary glorifying the action and plenty of blood. Like the noble Lord, Lord De Mauley, I have seen music videos which contain no actual sex but feature topless dancing. This is not something to which children should have access and, most importantly, it is not something that parents would expect children to have access to. I suggest this is why both the BBFC and LACORS support this amendment. Trading standards officers want to be able to take action to prevent such works being sold to children.

One of the things that worries me most about these exemptions is that the public are not really aware of them. Generally, consumers know the BBFC regime and expect it to protect them and their children. There is an assumption that such works will be classified and responsible members of the industry, generally members of the BVA, classify these works voluntarily. However, there is still a small but significant section who do not, and claim the exemption. This creates a parallel, unclassified market, which confuses consumers—the word “citizens” is very appropriate in this regard—still further. For example, would you not assume that a music video marked as exempt was less harmful than one that had voluntarily sought classification and been rated 15?

I know from the meeting that I had with the Minister last week, for which I am very grateful, that there is recognition that some of these works should be regulated. Therefore, I hope that the Minister will consider either accepting this amendment or, at the very least, as the noble Lord, Lord De Mauley, suggested, proposing an alternative wording, as the Bill represents an ideal opportunity to plug an obvious loophole.

My Lords, I have no objection at all to the purpose of this amendment but I quibble with some of the wording. As anyone with the slightest knowledge of Greek will be aware—Heaven knows, my Greek is sketchy in the extreme—“homophobia” does not mean a dislike of homosexuals. If it means anything at all, it means an aversion to one’s own kind. The press love the words “homophobia” and “homophobic” because they are short and snappy and save them a lot of space when composing headlines. However, a bogus word like that should not appear in an Act of Parliament.

My Lords, as the noble Lord, Lord De Mauley, and the noble Baroness, Lady Howe, have already noted, this amendment has drawn support from all Benches and I add my broad welcome for it from this Bench.

As I think we all agree, it is important to bring the most unacceptable content within the scope of statutory regulation and there is a need to update the law in this area. However, I take on board the valid point made by the noble Lord, Lord Monson, about the need to use language carefully and to remember what it means in its original context. Ironically, the readiness of responsible film makers and distributors to submit any borderline content to the regulator on a voluntary basis, as some are already doing—as the noble Baroness, Lady Howe, indicated—makes it more confusing for parents and other consumers, who simply may not realise that other similar content has not been past by any sort of regulator or classification system. This move will inevitably increase the number of videos that have to go through the video works authority for classification. However, if that increases trust in the system, and therefore its effectiveness in protecting young people from exposure to inappropriate material, I for one think that is a price well worth paying.

That said, I have concerns that the proposed new paragraph (f) pertaining to discriminatory language could lead to some presumably unintended consequences for so-called comedy performances where there are references to religion, sexual orientation or gender issues. It might also mean that some video recordings of sermons or other evangelistic material would cease to be exempted works because, for example, theological views that were critical of other religions were expressed. Clearly, this would have to be assessed on a case-by-case basis and a judgment would have to be made on the age appropriateness of different types of content. However, on a point of principle, it would be a shame if free speech were curtailed when we already have a host of laws, which, of course, the church welcomes, on preventing the stirring up of hatred against certain groups. The guidance note prepared by the British Video Association in association with the BBFC as a draft framework for what sort of material would and would not become non-exempt if this amendment were accepted, does not immediately address that issue. Nevertheless, I am persuaded that the board would take a sensible view on this because its track record suggests that that would be the case.

My Lords, I add the support of these Benches for the principle behind the amendment. I apologise for being the stand-in for my three colleagues at the moment. However, as my noble friend Lord Clement-Jones pointed out, last-minute changes of date occasionally lead to last-minute changes of personnel.

If you start to pull these things apart and suggest that there might be something wrong, you never achieve anything because you always have to rely on somebody somewhere having common sense. As regards going back to the original Greek, I suggest that that way madness lies. We have to rely on good judgment at some point. We need to have a system whereby people have a rough idea what it is and we need to let people know what is going on. I suggest that the measure is a sensible way forward. If the wording is not perfect we can debate it as we are in Committee, but we should have a good long look at the principle behind this.

My Lords, I am grateful to all noble Lords who have spoken in this brief debate on this important issue. I am grateful for the manner in which the noble Lord, Lord De Mauley, presented his case. He indicated that he was not entirely sure about the drafting of the amendment. I shall trade on that a little as it reflects the difficulties we all face with regard to these issues. We recognise that this is a very significant line to draw, particularly given the need to protect children from potentially harmful material. The noble Baroness, Lady Howe, indicated her interest in this issue, which is long established in any case, when she spoke on Second Reading. We know of the position of the noble Lord, Lord Monson, with regard to these issues. I am grateful for his intervention in the debate. However, as the right reverend Prelate indicated, we have to be careful where we tread because we certainly do not want to inhibit free speech and the proper discourse in a free society of issues pertaining to fundamentally held belief systems and views.

I find myself in a position where I fully understand the views that have been expressed and I have considerable sympathy with some of the principles which have been expressed. However, I emphasise that certain types of video content are exempt from classification. They include those that, when taken as a whole, are concerned with sport, music or religion and include works that are designed to inform, educate or instruct. On the whole, we all expect such works to enjoy freedom of expression, because their intent is clearly benign and for the good of society.

When the Video Recordings Act was drawn up, it was felt that, although the vast majority of this content should be exempt, if any otherwise exempted video work contained certain elements, such as sexual activity, they should fall back within the scope of the Act, because we recognised the capacity for the giving of offence, and in particular we were concerned about children. The current criteria listed in Section 2 of the Video Recordings Act have been working well for the past 25 years. The right reverend Prelate testified to certain successes in those terms. The vast majority of exempted video works are innocuous, and we believe that the existing text is sufficient to maintain the balance of proportionate regulation—which is what we are seeking—in an admittedly difficult and sensitive area.

The existing criteria mean that video recordings are not exempted if they contain material such as gross violence or depictions of sexual activity et cetera. The Government remain unconvinced that the issue extends beyond a handful of titles. I know that there are concerns about one or two titles. We do not think that this is reflective of gross abuse, but one or two titles cause concern. Even with those, we are not convinced that the existing criteria set down in the Act are not sufficient to cover most of them in any event. Just because some video publishers claim exemption does not mean that they have a right to it.

The Government believe that the intention behind the amendment, which was so articulately expressed this evening, is absolutely right; particularly the desire to protect children from inappropriate content. Although we do not believe that the amendment is the right way to achieve this—the noble Lord, Lord De Mauley, indicated that he had some anxieties about the drafting of his amendment—we do agree that we need to consider the issue further. I hope the noble Lord will accept that the Government are not cut and dried in defence of what we have presented in the Bill. We think it has real substance to it, and we are talking about a very limited number of instances. Anxiety has been expressed, and there is wide support across the House for the general theme of the amendment in this difficult area. We intend to consider the matter further and bring forward a position on Report. Therefore, I hope that the noble Lord, Lord De Mauley, will feel that his amendment has advanced the cause a considerable way. The Government will consider the matter further.

My Lords, I thank the noble Baroness, Lady Howe, not only for speaking, but for adding her name to the amendment. I thank the noble Lord, Lord Addington, for speaking on behalf of the noble Lord, Lord Clement-Jones, who had done the same. I am grateful to the noble Lord, Lord Monson, for his helpful contribution. I completely accept his correction. Indeed, when I moved the amendment, I acknowledged that it needed improvement. Likewise, I accept and welcome the contribution made by the right reverend Prelate the Bishop of Manchester. He is absolutely right, especially on the free speech point.

I thank the Minister for his response. He has not entirely convinced me, and I think that he has not entirely convinced himself, that we should let the matter rest. I am grateful for his last few words, which confirmed that. There is still work to be done. For today, I beg leave to withdraw the amendment.

Amendment 246 withdrawn.

Amendment 247

Moved by

247: Clause 40, page 43, leave out lines 41 to 44

Amendment 247 is designed to probe the use of the power which Clause 40 would give to the Secretary of State. As I understand it, it is intended to allow for the implementation of the updated Pan-European Games Information, which is the European standard for video games. I hope that the Minister will be able to confirm that when he responds. Could he tell the Committee whether the clause permits the Secretary of State to carry out other activities, or is it exclusively to implement PEGI? Would the Minister not agree that matters would be improved by putting in some safeguards around the use of the power? A requirement for consultation would seem to be appropriate. Defining a specific purpose, such as allowing an order to ensure consistency with an international standard, would also be useful. I beg to move.

My Lords, I am grateful to the noble Lord for his amendment. Proposed new Section 2A sets out the conditions that determine whether a video game is exempted from classification. The purpose is to define the criteria that mean that the video game is suitable only for persons aged 12 years and above. That is in line with the recommendations by Professor Tanya Byron for a statutory system which covers only games suitable for those over 12.

The content of video material is subject to change in a growing and developing technical world. Types of content many indeed change over time. The list of criteria currently set out in proposed new Section 2A will ensure that content suitable only for children over the age of 12 is covered by statutory regulation.

We cannot predict what alterations to the current criteria might be necessary in the future. If the type of content that is considered to be suitable only for children over the age of 12 changes, it is important that the Secretary of State and Parliament have the opportunity to reflect such matters of detail in the Act and make appropriate adjustments. It would be unworkable and overly restrictive not to allow changes to be made to these relatively low-level criteria set out in proposed new Section 2A to take account of any possible future developments and changes. I emphasise that the Secretary of State is not being given a power to make changes without accountability. The power to amend the criteria is subject to the affirmative resolution procedure and therefore subject to parliamentary scrutiny and debate. We are not seeking to extend the Secretary of State’s powers arbitrarily. We are seeking that essential flexibility—future-proofing, if one likes—against a background where we all recognise that the Bill has to tackle, and be valid to deal with, changes which may occur.

We looked closely at the scheme that best met the criteria set out by Professor Byron in her report. As she recommended, we began by consulting on various options. Following the consultation, which weighed four suggested options against the nine criteria put forward by her, and having carefully considered all the responses and all the issues, we concluded—as I think the noble Lord, Lord De Mauley, was arguing—that the PEGI system best met all the requirements. The enhanced PEGI option was selected because it best meets all the criteria that the professor set out in her report, it will offer excellent protection to children—which is the position that all noble Lords adopt with regard to these issues—and it will last into the future as far as we are able to identify. It also has the least negative impact on industry.

I hope it will be appreciated that the Government have taken into account all aspects of this challenging area. In reserving potential changes to these criteria for an affirmative resolution procedure rather than having to go back to re-establish primary legislation, the Government are not seeking to present the Secretary of State with grossly enhanced powers but merely making provision for the fact of potential change without recourse to primary legislation. I hope the noble Lord will feel that that is a satisfactory answer and that he can withdraw his amendment.

I thank the Minister for his response and will think carefully about what he has said. For today, I beg leave to withdraw the amendment.

Amendment 247 withdrawn.

Clause 40 agreed.

Clause 41 : Designated authority for video games etc

Amendment 248

Moved by

248: Clause 41, page 44, line 42, at end insert—

“( ) Where there are two designated authorities, the video games authority must allocate to the video works authority—

(a) if the primary purpose is not gaming; or(b) if the video game is likely to be rated R18.”

Amendments 248 and 249 explore the point at which the video games authority passes over responsibility for the classification of game material to the video works authority. According to the Explanatory Notes, the purpose of the proposed new subsections is to ensure that the classification of video games which are similar to video works that would rate a restricted classification or would lead to that sort of video work remains in the hands of the British Board of Film Classification, which has experience of handling such material. This is a sensible policy. It is a shame that, as drafted, the Bill does not set it out as such. Why have the Government not specified, as Amendment 248 does, the purpose of the subsection? What other purpose have the Government in mind for it?

Amendment 249 looks at where the responsibility lies for passing over material to the BBFC for classification. I understand that since responsibility for games generally lies with the video games authority, it needs to take an active part. How does the Minister envisage that a body with no experience in distinguishing between an 18 and R18 classification will identify the works that need to be sent to the BBFC? Are the Government proposing a whole new department within the video games authority which duplicates the work of the BBFC? I beg to move.

Again, I have added my name to the amendments of the noble Lord, Lord De Mauley. I am equally glad that they have secured Cross-Bench support. The Bill allows the video games authority to allocate certain classes of work to the video works authority. Interestingly, it is left to the Explanatory Notes to give Blu-ray discs and R18 games as examples. I understand that there is already agreement that these will be allocated to the BBFC. Since that is already agreed for good reason, it would make sense to include it in the Bill.

On the first class of work, films are increasingly being marketed with ancillary games attached to the same disc. The basic product is a film with some minor gaming additions. The BBFC has extensive experience of rating films and games together. I understand that the home entertainments industry wishes this situation to continue. The Bill should specifically enable this allocation to the BBFC.

R18 material consists of problematic and extreme material which can be sold only in a sex shop, and rightly so. The BBFC has years of experience in classifying such material. It is so trusted that, under the Criminal Justice and Immigration Act 2008, if a video work has a BBFC classification it is accepted that there cannot be a charge of possession of an extreme pornographic image. This exemption was included because the BBFC is recognised as the expert in judging what is often quite a fine line between acceptable and unacceptable content. Noble Lords will understand that this form of expertise has taken a number of years to develop and should be more sensibly recognised in the Bill. We should also be aware that if this does not happen it would be possible for pornography distributors to use a game format in an attempt to secure classification with fewer cuts.

Amendment 249 is also important as otherwise the clause establishes a potentially damaging inequality between the two regulators. In short, the existing regulator—the BBFC—is made completely subordinate to the new video games regulator in matters of determining which body should regulate a particular product. This is undesirable as a matter of principle and also as a matter of practice. If, because of its expertise, the BBFC is given responsibility for classifying R18 games, it makes no sense for the Video Standards Councils—with no experience of such content—to have the power to determine whether the game falls to the BBFC. Such decisions on individual works within a class of work that have been allocated should be left for the regulators to reach agreement.

I received a briefing from the VFC last week which implied that if this allocation were enforced, and if the BBFC were to judge a game to be 18 rather than R18, it would still rate the work, thus creating a dual system. I have checked this with the BBFC, which confirmed that it would do no such thing. It would refer the work back to the VSC with a recommendation that the game was not R18. The VSC would then be able to rate the game as it saw fit. This is already agreed between the VSC and the BBFC. This amendment in no way proposes otherwise. As the Bill stands, the VSC could judge a work as 18 and not refer it to the BBFC, and the BBFC could not overrule that decision, even if it were convinced that the work in question was an R18. Given the implications in law of such a mistake, this amendment should be accepted in full by the Government.

It seems we are once again addressing clarity and which group has the expertise at the moment to be able to give that clarity. The Government should look hard at this amendment, and I look forward to hearing their answer.

I am grateful to noble Lords for their contributions to this debate. The Government maintain that Clause 41 provides clarity about the division of responsibility between the video works authority and the video games authority. This is absolutely fundamental in creating a seamless system that delivers the policy intention, subscribed to by all the parts of the Committee, to adopt the Pan-European Games Information system of classification for video games.

The clause balances this clarity with the necessary degree of flexibility to deal with certain types of video games and the manner in which some games are now supplied with films. This flexibility is important to ensure that we have a clear, sensible and effective system that actually works on the ground. The overriding principle is that the video games authority is responsible for determining the classifications of video games. However, following detailed discussions with the BBFC and the VSC, and in order to allow a degree of flexibility in the system that will make practical sense to everyone, the Bill allows the video games authority to allocate to the video works authority a particular class of video game, such as R18—which the noble Baroness described accurately in her speech—or a game that is to be supplied in a particular way, such as the Blu-ray discs. This means that the Bill already allows what the noble Lord is seeking to achieve with Amendment 248. We do not need to say anything more in the legislation. Clause 41 achieves what is required in a neat, clear and helpful manner, without unnecessary complication or definition. I am at one with the noble Lord in his efforts with the amendment to achieve those aims: I am merely indicating that they have been achieved already.

I emphasise that the Secretary of State can issue guidance. Both the BBFC and the video games authority must pay attention to that guidance. I assure noble Lords, because I am responsive to the concerns expressed in several parts of the Committee, that the Government will include specific guidance that R18 video games should be allocated across to the BBFC, underpinning the agreement that we already have in place and in practice. I give the assurance that the Government will include that in guidance. Therefore I hope that noble Lords will feel that they have pressed the Government on these issues, that we are fully cognisant and aware of the anxieties, and that the Bill as it stands, and the way in which it is intended that it should be implemented, meets their anxieties and concerns, so that they will not press their amendments.

My Lords, I thank those from all parts of the Committee who put their names to the amendment, and those who spoke. I am grateful for what the Minister said, in particular about the proposed guidance. We will all think about the matter before Report. I beg leave to withdraw the amendment.

Amendment 248 withdrawn.

Amendment 249 not moved.

Amendment 250

Moved by

250: Clause 41, page 45, leave out lines 21 to 23

My Lords, I will be interested to hear the Minister's response to these amendments. Both amendments in this group deal with hybrid games material: that is to say, games containing both games and linear material. The amendment probes PEGI, while the amendment of the noble Baroness, Lady Howe, suggests a more specific solution. Does the Minister envisage PEGI automatically volunteering to give the BBFC classification rights over all linear work in a relevant game? Or does the Minister consider that there will be occasions where confirming the classification formally will be unnecessary?

There is concern also about the labelling of such works. Games and linear material follow different levels of classification. A game based on a film that was classified as a 15 by the BBFC could be turned into a work with a minor amount of interactivity, which would suddenly move it to a 16 under games classification. I beg to move.

My Lords, Amendment 251 is in my name and those of the noble Lords, Lord Gordon of Strathblane and Lord Clement-Jones. The amendment replaces proposed new Section 4ZC of the 1984 Act and seeks to enshrine in law the current situation whereby the BBFC, which the Government plan to designate as the video works authority, remains responsible for any non-integral video works in a video game. This could include films or even TV series accessed as a reward for reaching a certain level in a game.

Last week, I and other noble Lords received a briefing from the Video Standards Council. It referred to Amendment 251 as a wrecking amendment. Not only is this not my intention, but I do not accept that it is one. I was also grateful to the noble Lord, Lord Young, for arranging a meeting last week with his officials. I acknowledge that, again, he and the officials tried to persuade me that the amendment was unnecessary. However, I am afraid that I remain firmly of the belief that, if the Byron report is to be implemented in full and in a way that does not undermine the system that we have in this country for the classification of linear, film-type material, we must amend the Video Recordings Act to make it clear that the BBFC remains responsible for film-type material.

It was suggested to me that the BBFC would classify film-type material and games, and then hand over the classification to the Video Standards Council to take account of its overall classification of the game. This is not what was suggested by Tanya Byron: nor was it the stated intention of the Government. The Government's response to the consultation on options for a strengthened video games classification states that,

“the BBFC will continue to rate any film or video content found on video game discs that is not integral to the game, as they currently do”.

However, if I understand it correctly, the Bill raises a series of new questions and concerns. Could the VSC overrule the BBFC on non-integral linear material? Where does this leave the consumer? We could have a situation where a video game contains a series of films and yet the disc has a PEGI classification, which, according to the Bill, could bear no relation to the BBFC classification.

LACORS is the body that represents local authorities. Its trading standards officers must enforce these regulations, and it has informed me that it supports the amendment. It, too, has no reason to wreck the Bill. It is worried about enforcement and believes that the Bill could mislead consumers because a PEGI rating on a disc, which could be a hybrid product, would lead them to believe that it was a game rather than a series of films—or even pornography accessed through a game. This would mean that the product could also fall foul of the Consumer Protection from Unfair Trading Regulations 2008.

It is important to recognise that the public are used to seeing the BBFC classification symbol, and understand what it means. Independent research undertaken for the BBFC in 2009 shows that 71 per cent of viewers check the BBFC classification before deciding whether to watch a video work, while 88 per cent of parents with young children rate the BBFC as effective. We cannot ignore the fact that a PEGI classification for film-type material would be confusing to the public and to law enforcement agencies.

LACORS is also deeply concerned about how, on a practical level, it would enforce these classifications. If it was pursuing a prosecution over the sale of a game because of the linear content in that game, to whom would it turn for support in court? The VSC could say only that it had rated the product 18, for example, because of a classification given to it by the BBFC. Does this BBFC classification have any legal standing under the current terms of the Bill in relation to provision of evidence? If the BBFC could not go to court, would this leave law enforcement officers with no support in their prosecution? This is not an insignificant issue because in 2009 alone, the BBFC provided evidence in 211 cases; that was a year in which, from August, the VRA’s problem meant there were no prosecutions. The only solution I can see to this issue is to allow the BBFC to remain responsible, as it is now, for non-integral linear content in games.

In its evidence to the Byron consultation, the VSC’s own data stated that in 2007 it referred 101 games—8.2 per cent of the total classified by PEGI—to the BBFC for a combination of gross violence, sexual activity and non-integral linear material. Of these 101 games, 51 were referred because they contained linear content only. Based on the VSC’s own data, therefore, and assuming 2007 to be broadly representative, the percentage of games containing non-integral linear content to be rated by the BBFC would be 4 per cent of the total. Ninety-six per cent of video games would be rated exclusively by PEGI.

It is important that this legislation is future-proofed and enforceable. We cannot predict how many video games may contain film-type linear material in future. We need a system that consumers understand and that law enforcement officers can implement. This amendment protects us from a situation where any so-called game, even one that has substantial film material, is rated solely by the VSC, which would be extremely confusing for the consumer and the citizen. It also prevents a product that is primarily linear being repackaged as a game to avoid robust BBFC classification.

My Lords, these amendments follow neatly the earlier debate this evening and, as I see it, they are about preserving the integrity of a system which over the course of almost a century has built up a reputation for making, on the whole, sound judgments about the age appropriateness of cinematic material. It makes sense for the video works authority—which I assume, as the noble Baroness, Lady Howe, has said, to be the BBFC—to continue to assess all film content, even if it forms part of a game. It is what it does and it is what it does best.

Your Lordships may remember the argument that arose not all that long ago when a games manufacturer created visual footage of the inside of Manchester Cathedral, without permission, as the setting for a very violent fantasy fighting scene, including all sorts of nasty creatures, none of which I recognised as regular worshippers, using futuristic weapons. The episode showed me how much we have moved on from the days of pixelated Pac-Men wobbling across the screen.

We need to ensure that this Bill creates the best possible system that responds to a rapidly evolving market with a classification framework that is not only fit for purpose but fit for tomorrow’s purpose. That demands clarity of role and clarity of division of responsibility between the two authorities. We have already spent some time on this matter this evening but I believe these amendments have got it right. The video works authority should, without any ambiguity, continue to be responsible for classifying video works however and whenever they appear in a game. That will ensure that there is a consistency of classification of material that has appeared in a prior cinema or DVD release and that the BBFC’s classifications are not undermined later by another body. That would be unhelpful for consumers and ultimately unhelpful for the industries involved. Therefore I support these amendments.

My Lords, once again we come back to the idea of knowing what is on the tin—letting people know what they are going to get out of this. This may not be the right way forward but it is definitely a way forward. We need to have some idea of the correct type of classification—what actually is involved. If you have to shoot three video images on a game first then get a film, the film may be the supreme content. This approach may at least be one way of getting there.

I am left with the image of the right reverend Prelate’s congregation being rather more colourful than he originally imagined. We shall leave that there. Possibly the pillars in the cathedral obscured certain parts of it.

We should have some way of trying to tie these two things together and letting people know what is there when they purchase something.

My Lords, I am grateful to noble Lords for their contribution to this debate. However, I fear that we have two perspectives which do not agree and therefore I am going to argue the case that the amendment should be withdrawn. The amendments relate to that interesting case—the right reverend Prelate indicated just how interesting the situation can be—when film content is included in games and the extraordinary context in which certain actions can be carried out. We all recognise the problem. We all recognise that where a piece of film is found within a video game there is an issue of potential challenge. The Government’s position, as outlined in the Bill, is clear and that is why I will be seeking to defend the Bill as it stands and seeking to identify why it would be a mistake to move away from the Bill in the way in which the amendments suggest.

The video games authority should determine the classification for the game but it has to make appropriate arrangements to seek the determination and views of the video works authority, the BBFC. It has to make arrangements to seek those views but only with respect to the film content, for which the BBFC, as has rightly been identified across the Committee, enjoys a high reputation in terms of the many years it has been involved in this work.

The video games authority must have regard to the views of the BBFC—the video works authority—in determining the final classification of the game. I want to emphasise that if it came to a question of a court of law on the issue and if we came to the point where the issues became serious enough to be taken to court, both the organisations would be able to appear and to give evidence if required. Nothing strikes the BBFC out of the assessment for the classification. It has an important role to play. If for any reason there was a contest in court about a film that it had classified it would be expected that it would submit its evidence on its judgment. We are not taking it out of the decision. However, what we are saying—this is what is really at stake between the position of the Bill and the amendments—is that we are fulfilling the key criteria put forward by Professor Tanya Byron when she presented her recommendations on the concept we should develop: that there must be a clear system which is simple and effective for consumers with regard to games. The video games authority is that system and must be identified as such.

Of course it does not come wreathed in laurels as the BBFC does, with its half a century and more of involvement in this. How can it? It is in a newer position. We are seeking to establish a clear authority for games. That is a prerequisite, as the noble Baroness, Lady Howe, and to a certain extent the noble Lord, emphasised. Everyone, from parents who are concerned about their children to all who are concerned about content—the industry as well as the general public—must know where responsibility lies. The Bill makes it absolutely clear that the video games authority has that authority.

If the BBFC gave a separate classification certificate for filmed content in a video game, as the amendment proposes, it would surely undermine the purpose and effect of having a separate classification system for the games because we would have two classifications in operation or we would hand to the video works authority—to the BBFC—something that it had neither sought nor expected and that neither we, nor I think the mover of the amendment, seek to create. We are trying to establish the video games authority as the single authority that is responsible at the end of the day for classification.

The current wording in the Bill is both certain and rational. It makes sense for the BBFC to continue to classify filmed content—that is its well established role, for which it is held in high repute—and for the video games authority to classify video games where a game contains film content. Of course the video games authority must make sensible arrangements to obtain the BBFC’s determinations on that filmed content and to classify the game as a whole while having regard to the BBFC’s judgment. This allows the two designated authorities to work effectively together while respecting their individual roles and boundaries and giving to the public one clear authority that is responsible for the classification at the end of the day.

Arrangements that are so made by the video games authority with the BBFC must follow in the wake of consultation with the BBFC and have regard to any guidance that may be issued. As I have indicated, when it operates in that circumstance, it must have regard to the fact that if anything reached an unhappy pass and went to a court of law, the BBFC’s evidence would also make a valid contribution to the court’s proceedings. We seek a pragmatic and uncomplicated but co-operative approach that vests authority in one place.

We have set down the framework for an effective way of handling video games that takes on board and respects the BBFC’s distinct role, which has been attested to in this short debate. This means that publishers have certainty about how games will be handled by the video games authority, and consumers have certainty and clarity about the type of content that they are buying.

That is in the Bill. I understand the anxieties that have given rise to the amendment, but I hope in the light of my explanation that it will be seen that nothing more is required in the Bill and that the amendment is otiose and can be safely withdrawn.

I thank the Minister for his comments. He said that the Government’s position was clear and that the proposals are sensible and rational, and went on to explain something that was about as clear as mud. Unfortunately, he has yet again explained on behalf of the Government how two organisations will work together and co-operate without being absolutely clear who will do which bit, as we have pointed out. However, in the interests of getting on with the debate, and given the Government’s predilection for this sort of arrangement, which always ends up being a mess, I beg leave to withdraw the amendment.

Amendment 250 withdrawn.

Amendment 251

Tabled by

251: Clause 41, page 45, leave out lines 21 to 41 and insert—

“Where there are two designated authorities, in the event that a video game includes one or more video works which are not video games, responsibility for making arrangements for determining whether such a video work is suitable for the issue of a classification certificate or for the issue of a classification certificate of a particular description falls with—

(a) the video works authority for any video work included in the video game;(b) the video games authority for the rest of the video game.”

I share the concerns of the noble Lord, Lord Howard of Rising, in that the thing is not at all clearly explained. The situation is very muddled and confusing in many respects. Again, as he has said, we will have to read very carefully what the Minister has said, although the Minister has gone a long way to try to set out something that is as clear as mud, for which I thank him. I hope that it will be clearer when one reads it in detail.

Amendment 251 not moved.

Clause 41 agreed.

Amendment 251A

Moved by

251A: After Clause 41, insert the following new Clause—

“Duty to promote online safety

(1) It shall be the duty of internet service providers and mobile phone operators to take such steps, and to enter into such arrangements—

(a) to bring about, or to encourage others to bring about, a better public understanding of online safety;(b) to provide prominent, easily accessible and clear information on filtering options of public electronic communication services for the purposes of online safety—(i) at the time of purchase of the service; and(ii) to make such information available for the duration of the contract.(2) In this section “online safety” means safe, responsible use of the internet and other communication devices by children and young people.”

My Lords, in moving Amendment 251A, I shall also speak to Amendment 255A. I do so on behalf of CARE, which has a particular interest in the safety of children, particularly as far as online material is concerned.

Amendment 251A would require those who sell internet access—internet service providers and mobile phone operators—to provide customers with prominent, easily accessible and clear information about the availability of parental control software at the point of purchase and throughout the contract. The key words “prominent” and “accessible” have been taken from the recommendations on social networking websites by the Home Office Task Force on Child Protection on the Internet. To date, the Government’s energies have focused on trying to protect children with respect to the internet via best practice guidance, but this has been problematic, as Professor Byron explained. She says:

“crucially, performance against these standards is not monitored, so the public has no way of knowing which companies are adopting good practice”.

Moreover, although the Home Office task force has produced guidelines on various issues, it has not provided ISPs and mobile phone operators with guidance on filtering. Neither has the industry produced self-regulatory mechanisms in its code of conduct. The Internet Service Providers’ Association makes no specific mention in its members’ code of practice relating to informing customers of filtering software. It does have a section on ISP’s requirements in relation to the Internet Watch Foundation. However, much more needs to be done to deal with material that, although not illegal, should not be accessible by children. The Mobile Broadband Group’s code of conduct is better, but still lacks the vital protection proposed by this amendment, which makes information about child protection filtering mechanisms prominent and easily accessible at the point of purchase and for the duration of the contract.

I am aware that many companies make filtering options available, but surely it is time to move things forward by requiring the industry to make the option of accessing filtering software prominent and accessible at the point of purchase and throughout the duration of the contract. This amendment is simple and modest and will increase the chances that parents or guardians who buy internet access will acquire it with appropriate safeguards for their children.

Amendment 255A requires online retailers who sell or allow access to age-restricted goods or services to have,

“in place a clearly-identifiable and robust age-verification scheme”,

that prevents minors from purchasing or accessing the goods or services in question. I bring this issue to your Lordships’ attention because I believe that we must do more than we have so far to prevent children and underage teenagers from purchasing or accessing inappropriate online goods and services. The incongruity between what happens online and what happens offline makes a mockery of our law and creates a dangerous division between the real and the virtual world which we really should not continue to tolerate. Quite apart from the problems relating to children accessing inappropriate film content online, an issue which I have already covered, there is the issue of playing games online. One example of particular concern is “Quake Live”, which is based on the offline first-person shooter game and has received an 18 rating. It is very disturbing that any boy or girl can access “Quake Live” online when they would not be able to purchase a comparable game from a shop.

Online retailers who sell age-restricted goods such as alcohol, tobacco, or access to gambling services are already required to make suitable arrangements not to sell goods to underage individuals. In practice, however, these often amount only to self-certification. My amendment would not only require a more robust framework to be put into place; it would also apply to all goods and services that are age-restricted. I am assured that gambling websites, which operate under the licensing regime of the Gambling Commission, function in a responsible way and could be a model for some, if not all, forms of online sales. They offer a number of ways in which age can be verified.

Before I end, I must say a word in anticipation of those who may be about to suggest that these amendments will place too great a burden on business. I very much hope that the Minister will agree that it is crucial that the well-being of children is indeed well protected. If it is not inappropriate to expect the state to develop and enforce complex laws to protect adults from unscrupulous businesses in order to protect both employees and customers, it cannot be inappropriate to expect the state and businesses to go the extra mile in protecting children and the vulnerable.

Amendments 251A and 255A are amendments whose time has come. I point out to your Lordships that tomorrow is Safer Internet Day, and it is clearly rather appropriate that we should bear it in mind. I was also interested to see in The Times last month some interesting research that had been carried out by the Australian Research Centre in Sex, Health and Society. On these issues—particularly pornography and near-pornography—the centre says that there is compelling evidence from around the world that pornography has negative effects on individuals and communities. This is something which we all know but which we need to bear in mind when framing new legislation. I beg to move.

My Lords, I support the amendments moved by the noble Baroness, Lady Howe of Idlicote, first of all on the basis of promoting online safety. In a recent comment, the director of research for IBM, discussing a report which IBM produced, said that the internet was like the Wild West. Exactly what he meant by that may mean different things to different Members of the Committee, but it appeared to me that he meant that it was utterly uncontrolled, at least in some respects. If that is true, then it is particularly true in relation to children.

Dr Tanya Byron, who has already been referred to, was involved with TalkTalk in a research project looking at the interaction between children and the internet. That research reached the conclusion that 63 per cent of children had lied to their parents about their online behaviour. In other words, they knew that they were doing something online of which their parents would disapprove, and therefore the best protection was to refuse to tell them; in other words to lie about what they were doing. Some 44 per cent boasted that they could hide unsuitable internet activity from their parents. No doubt the lies were part of that hiding operation, but there may have been other ways of doing so as well. Some 53 per cent had deleted their browser history, so that their parents could not check where they had been, or which particular websites they had been visiting.

There is certainly an incongruity between the presence of proper legal protections offline and their absence online. We have very strong protections for all sorts of activities, as the noble Baroness has said. Although there has been some attempt to produce a safe and secure environment without recourse to the law, through the promotion of voluntary self-regulation and good practice guidance, the truth is that there is still great room for improvement. In that respect, I believe that the law and this Bill have a part to play. Although it is undoubtedly true that many providers of internet access already make filtering options available for purchase, Amendment 251A will ensure that we fully benefit from filtering protection by requiring providers to make filtering options available and to make them available in a prominent place on the website as it is offered, at the point of purchase and for the duration of the contract. This provides a very simple, light-touch type of control which would have a very good chance of being effective.

We know the dangers to which children are exposed via the internet from a number of sources. Amendment 255A deals with age verification, which is already required in quite a number of instances. It seems right to have the same concern for protecting underage children from accessing unsuitable material on the internet as we have for protecting them from accessing unsuitable things such as cigarettes, alcohol and the like offline. Why not do the same for online things as we do for offline things? I hope the Minister will be able to accept the spirit of these amendments, if not their words. I am sure that the wording can be improved by the labours of parliamentary counsel, but I think the principle is reasonably clear.

I am very pleased to support the amendments tabled by the noble Baroness, Lady Howe of Idlicote. I remember very clearly the debates during the passage of the Criminal Justice and Immigration Act 2008 when the Government criminalised the storing of photographs of activities between consenting adults in the privacy of their own home but did nothing to protect children from all sorts of violence and pornography, despite many of us urging them to do so. I am particularly pleased that the noble Baroness has returned to this issue. The Government’s argument then was all about protecting society. It was extraordinary that they ran that argument but did nothing to protect under-18s. This is a chance to remedy that. I hope the Government will grasp this opportunity.

An issue which strikes me in relation to these helpful amendments is that responsible retailers who have invested in more robust age-verification systems fear being commercially penalised as their less scrupulous competitors will become magnets for those seeking to bypass the age-restriction laws. I appreciate that this makes it no less illegal for them to sell to minors, but the fact remains that we currently provide neither stick nor carrot for them to invest more heavily.

My support for these timely amendments, especially Amendment 255A, is borne partly by the practical desire to clamp down on these irresponsible online retailers, and partly from a wider concern—one that stretches to the nature of communication and interaction online. It is difficult for retailers to know whether the person at the end of the mouse is old enough to buy their goods. That belies the wider fact that the internet can create anonymity and fabricate masks. If we encrypt our identities, for whatever malevolent intent, the people at the other end will suffer. In this case, young people are asking retailers to break the law. As the noble and learned Lord, Lord Mackay of Clashfern, said, they often lie to, or hide the truth from, their parents.

We need to face up to the consequences of doing more and more things in our technological age without real interpersonal connectivity. I do not wish to detain your Lordships on this matter this evening, but I raise the issue because this amendment helpfully points to some interesting and also disturbing shifts in the tectonic plates which undergird our common life. In common with other noble Lords who have spoken, I very much hope the Minister will respond in a positive way, at least to the spirit of what has been said in this debate.

I lend my support to the noble Baroness’s amendment. I am trying to recall the date when I spoke on the Criminal Justice and Police Bill—it was either 2000 or 2001. At that time, I asked for the very same safeguards to be considered by the Government. I was watching my own children do just as my noble and learned friend has described: accessing all kinds of stuff on the screen without my knowledge and without my understanding. So many parents either turn a blind eye to this or, in many cases, simply do not understand how easy it is for their children to access all sorts of material without their knowledge. I hope that we have come a long way as regards accepting this since 2001 when I was told that it was too difficult to do something about this. The reality is that the technology is there and it is just a question of cost. Obviously it is a cost that providers would have to take on board, as I believe they should.

The objective behind these amendments is extremely laudable and my sympathies lie entirely with my noble friend Lady Howe. We have to be careful that what is in these amendments will work and it is technically possible. Once you have a connection with an internet service provider, your homepage could be with anyone, although it will probably be Google or the BBC or one of the other big providers. It may be that the responsibility should lie with someone else to produce a button showing how you can access parental control. It may not be best placed with your internet service provider.

On the duty to confirm age, we have to be very careful not to penalise companies which are purely resident or have their servers in Britain. There is the problem of where a transaction takes place. If you use Mozilla, for example, you can have something which tells you the true residence of the server through which you are purchasing. I find it helpful in telling me whether the site is likely to be genuine or not. The number of companies which appear to be British but in fact are hosted abroad is amazing and, therefore, the products come from a foreign jurisdiction. So where does the liability lie? Perhaps we ought to put in some provisions like Rome II, which deals with suing for goods which are not fit for purpose. It may turn out to be more complicated. So although I fully understand the amendments and my sympathies lie with them, much more thought and extra work may be required.

It will be highly interesting to hear the Minister's response to these amendments. I was under the impression that there was a clear legal duty to ensure that age-restricted products are not sold to those who are not old enough to purchase them. However, having listened to my noble and learned friend Lord Mackay, I see that that may not be the case. Perhaps the Minister can tell the House.

I would also be grateful to know whether any assessment has been made of the efficiency and efficacy of the existing legislation. Has it made a measurable impact on restricting inappropriate access by the under-18s? Listening to the statistics quoted by my noble and learned friend Lord Mackay, I do not think so, which makes one wonder, laudable though the intentions behind these amendments may be, how they can possibly be made to be effective, as suggested by my noble friend Lady Buscombe. I look forward to the Minister's comments.

I shall not agree with the amendments but at least I shall take most of the House with me when I express our constructive approach to these very difficult problems, as opposed to Opposition Front Bench Members who seem to throw up their hands in horror and say that nothing can be done. I shall turn to what can be done in a moment.

Of course, I entirely sympathise with the objectives behind the amendments and the concern about the safety of children on the internet or when using other modern communication devices. We showed the importance we attach to this by commissioning the recent report, to which much reference has been made in the past hour, from Dr Tanya Byron entitled Safer Children in a Digital World. We did not merely accept all her recommendations but—this may take the breath away of noble Lords who can adopt from time to time a somewhat critical stance with regard to the Government—we have already seen action on them. The work is being led by the UK Council for Child Internet Safety, which was set up in December and brings together the Government, law enforcement agencies—I am glad that the issue of the law and how effective it can be has come up in these discussions—charities, other NGOs and a wide range of companies. The council has been hard at work since its foundation. It is already doing much to promote a greater understanding of online safety among children and, crucially, their parents and carers, and to improve education in schools by making online safety part of the curriculum.

The council is also working with industry to implement effective regulation of online services that children use, which will be reviewed independently to test how effectively safeguards work. I agree with the representations made this evening about needing to know the effectiveness of the action taken. In addition, the council will launch the Click Clever, Click Safe public awareness campaign with an online version of the green cross code—Zip it, Block it, Flag it—which is intended to see the digital code become as familiar as the green cross code was to communicate with parents. I heard what the noble Baroness, Lady Buscombe, said about parents’ awareness. I could not agree more, but a great deal of the difficulty is not that children conceal things from their parents, but that their parents are unaware of what they ought to be looking at and for. That is what this process is designed to deliver.

The work of the council already anticipates two points that were made in this discussion. It has already said that it is important that monitoring is carried out. There is no doubt that we need to see monitoring of performance against the codes of conduct, and the council has stated that it will take responsibility for ensuring that that is done. The noble Baroness, Lady Howe, indicated that tomorrow is Safer Internet day. That is a Europe-wide sponsored event, but the council supports it and is launching its public awareness campaign tomorrow as part of developments on that day.

The answer to the well founded anxieties about these issues is that action is already being taken and largely takes on board the points raised in this debate, save for the issues raised by Amendment 255A. I am eager to confront the noble Lord, Lord Howard of Rising, on his rather negative stance with regard to this, although I am not too sure that I eagerly accept his invitation to clash with the noble and learned Lord, Lord Mackay, on how the law will be affected. It is a serious problem that children using the relative anonymity of the internet can purchase age-restricted goods and services that they would find hard to get if they were buying them in person. However, we already have clear laws in place. The issue is enforcement. That was the question that the noble and learned Lord, Lord Mackay, identified, and he was followed by several other noble Lords who have contributed to this debate and by the right reverend Prelate. The Government’s principle is quite clear and it underpins the law: what is illegal offline is also illegal online. There is no distinction between the two; there are no separate laws. The Bill cannot be used to create a different framework from what obtains elsewhere. The issue is how we enforce the law.

The right reverend Prelate identified the fact that business has a clear interest that if the law is to be effectively enforced, it must be universal or else there will be a comparative advantage to those who break and defy the law. We have recently seen slightly safer, although difficult, areas. On the selling of tobacco, although we never rest content, we are somewhat reassured about how the law is enforced. On alcohol, the challenges still remain. The degree of public concern about the sale of alcohol to young people is being reflected in business practice across the country and the widespread public concern and anxiety that action should be taken. By the same token, that has to apply online. Retailers must already have robust systems for verifying the age of their customers and can be challenged and brought before the courts if they fail to carry out verification and sell to underage customers. We have got to make sure that that obtains for the sale of goods and services online.

I share the Committee’s anxieties. I am trying to go one considerable stage further, almost the diametric opposite to the noble Lord, Lord Howard of Rising, who identified the problem with his usual accuracy but is doubtful whether there is any solution. There is a clear solution. Public opinion is demanding of government, law enforcers and the community. The council brings together all those who are concerned with effective action to protect our children and guarantee that the law is effectively enforced. The structure is there. There is no need to amend the Bill. What we need is public awareness, public action and action by all those with responsibility for the safety of our children. That is the basis of the Government’s position. The final one, which these amendments contradict, is that what is unlawful offline is also unlawful online. I hope the noble Baroness will withdraw her amendment on that basis.

My Lords, I am very grateful to the Minister for having set out quite carefully and fully what the Government are doing with advertising campaigns and so on. However, I can see no reason why he would not support the idea of having internet service providers inform customers about filtering software, for example. They could do that perfectly well and it would not cost huge sums of money. It would be another way of informing the public whom we have all heard are not at all aware of much of what their children are watching, should not be watching and would not be watching if there were no access online.

I thank everybody who has taken part in this debate because it illustrates the fact that these issues are still of considerable concern. In accepting, as I have done, that the Government are doing a certain amount, it is also clear that more needs to be done. I hope, too, that the noble Lord, Lord Howard of Rising, will be listening hard to some of the speeches made by his noble friends, which might help the Opposition to think a little more positively than it appears at the moment.

I thank the noble Baroness, Lady Miller of Chilthorne Domer, for reminding us of previous battles. It is another illustration of how far back all this goes. We continue to fight and we shall continue to air these issues in future. I am sure that the right reverend Prelate the Bishop of Manchester will accept thanks for the support that he has given to the debate.

I certainly want to read what has been said and to discuss anything further that we can do to see whether there is a case for coming back on Report. In the mean time I beg leave to withdraw the amendment.

Amendment 251A withdrawn.

Amendment 251B

Moved by

251B: After Clause 41, insert the following new Clause—

“Additional protection from harmful material through online on-demand programme services using age verification scheme

For section 368E(2) of the Communication Act 2003 (harmful material), substitute—

“(2) An online on-demand programme service must not contain any material which might seriously impair the physical, mental or moral development of persons under the age of eighteen.

(3) If an online on-demand programme service contains the following material, the material must only be made available using a clearly identifiable and robust age verification scheme to determine that the person purchasing or otherwise obtaining access to the material is not under eighteen—

(a) material which might seriously impair the physical, mental or moral development of persons under the age of eighteen;(b) material which is contained in a video work for which a classification certificate has been issued containing the statements mentioned in section 7(2)(c) of the Video Recordings Act 1984 (recordings to be supplied only in licensed sex shops);(c) material which falls within subsection (4) unless it is contained in a video work for which a classification certificate other than one containing the statements mentioned in section 7(2)(c) of the Video Recordings Act 1984 (recordings to be supplied only in licensed sex shops) has been issued.(4) Material falls within this subsection if it is pornographic and portrays, in an explicit and realistic way, any of the following—

(a) an act of penetration of the vagina or anus of a person with a part of a person’s body or anything else;(b) the performance by a person of an act of intercourse or oral sex;(c) the performance by a person or an act of intercourse or oral sex with an animal;(d) an act of masturbation;(e) an act of ejaculation;(f) human genital organs or human urinary or excretory functions; or(g) an act of restraint or violence which is associated with sexual activity.(5) In this section—

“classification certificate” and “video work” have the same meaning as in the Video Recordings Act 1984;

“pornographic” has the same meaning as in section 63 of the Criminal Justice and Immigration Act 2008 (possession of extreme pornographic images).””

The Committee will be pleased to know that this is the last in the line and refers to an age verification scheme for certain defined online pornographic material access to which could otherwise be harmful to children.

I believe that the amendment is necessary because the current regulatory regime under the Communications Act relating to video on demand services operating from the UK is insufficient to protect children from harm. The Video Recordings Act ensures that in the physical world the supply of R18 hardcore pornography is limited to licensed sex shops. We must not forget that that is all behind very definitely closed doors when in the real world, as it were. Children are not permitted to even enter, let alone purchase products from these stores. Mail-order supplies of R18 DVDs are prohibited in this country. These restrictions are in place because as a society we believe that children should not have access to such material. In contrast in the online world there is no such restriction, even for UK-based hardcore pornography. Indeed, service providers are free to provide such pornographic content without any access controls to prevent viewing by children.

The Communications Act only requires service providers to place content behind access controls such as credit card payment or checks against the electoral roll, if the material,

“might seriously impair the physical, mental or moral development of persons under the age of eighteen”.

I have already referred to some research that has been done, which seems to indicate that viewing such material has an effect on youngsters growing up.

Ofcom, which currently regulates video on demand services and ATVOD—the Association for Television On-Demand—which is expected to regulate this area in the near future, have both concluded that material classified by the BBFC in any category including R18 would not be considered likely to “seriously impair” children. This interpretation of the Act means that the new online regulated environment is sufficiently robust to protect children from potentially harmful content, particularly hardcore pornography and material which would be rejected under the Video Recordings Act in the physical world.

The amendment would ensure that the current regulations would be strengthened to provide protection for children from R18 and R18-equivalent content in regulated video on demand services. The amendment would require additional regulations which clearly and specifically target R18 and R18-equivalent material and place it behind access controls, coupled with an outright prohibition on content which goes beyond that which would be classified by the BBFC in any category. I hope that the Government will carefully consider this amendment which will ensure a more consistent regulatory approach to the online and physical world to protect children from harmful content. I beg to move.

My Lords, I do not think that the noble Baroness, Lady Howe, should in any sense feel that there will be relief all round the Chamber now that she has come to the end of her series of amendments. She is to be congratulated on raising a significant number of important matters that must be addressed. On this matter, I am sure that the Minister and your Lordships will feel that there are clear issues of concern, and I hope that the Minister will show that the Government take them very seriously.

My Lords, I am happy to reassure the noble Baroness, Lady Howe, and the right reverend Prelate the Bishop of Manchester on these points, but I cannot accept the amendment because we have a law in place that achieves its effect. Section 368E(2) of the Communications Act was introduced by the Audiovisual Media Services Regulations 2009 and requires that, if an on-demand programme service contains material which might cause serious impairment to children or young people, it should only be shown in a way that would ensure that they do not usually see it or hear it. The regulations are in response to a European Union directive that applies to all on-demand programme services all the time. I accept entirely the anxieties of the noble Baroness about these issues, which prompted her to table the amendment, but the question is whether we should go further than the present regulations. We are in discussion about this with Ofcom and the Association for Television On-Demand, the leading video-on-demand industry body to make sure that any moves we make are the right ones to ensure that children are adequately protected. If it turns out on reflection that it is necessary for the Government to take action, we can introduce further regulations under the same provision as those in force at present, to strengthen and reinforce the protection. I reassure the noble Baroness that she has raised an important topic but her amendment is not necessary.

My Lords, I am grateful to the Minister for what he has said. I cannot say that he has completely reassured me. No doubt, not only I but CARE, BBFC and others will look at what he has said. We shall see whether there is a reason to come back on Report. I should also like to thank the right reverend Prelate the Bishop of Manchester for his support. On that basis, I beg leave to withdraw the amendment.

Amendment 251B withdrawn.

Schedule 1 : Classification of video games etc: supplementary provision

Amendments 252 and 253 had been withdrawn from the Marshalled List.

Amendment 254

Moved by

254: Schedule 1, page 52, line 19, leave out sub-paragraph (5)

My Lords, I should like to probe the Minister as to why, under paragraph 2(5) of Schedule 1, the Government are giving up control of the fee an authority may charge for classification. The idea of a Government giving up control of something, when those involved apparently did not ask for it, is unusual enough for it to warrant further investigation. I look forward to hearing what the Minister has to say.

Amendment 255 is more substantial. Paragraph 4 of Schedule 1 allows an authority to charge for the classification of the same material every time it is reproduced in a different format, despite the material being identical. I understand that it is the practice for PEGI, and very lucrative it must be, with so many different ways of playing video games. I am glad that the BBFC apparently has no intention to start that practice and will instead continue to charge one fee for each video work, regardless of whether it is brought out on different platforms. Does the Minister feel that multiple fees of this nature are right? It seems artificial to insist on a distinction between the same material received in a different manner. I beg to move.

My Lords, I thought that the noble Lord was for the moment going to congratulate the Government on an unusual and particularly attractive action, but he did not quite manage the latter part of that phrase. I want to assure him that what we are doing is attractive. We do not want the designated authority to charge unduly burdensome fees by virtue of this legislation, but it must charge reasonable fees to reflect the level of work which is undertaken. I am sure that the noble Lord will agree with that.

We believe that it is right that the Secretary of State has a consultative role in the fees tariff, which is one stage back from central government authority. It should have a consultative role in the fees tariffs, which should be set by the designated authority. There is no need to have a formal approval process. We want to create a fair and transparent system with every reason to believe that the designated authority will act responsibly and properly in relation to setting the fees. If that were not the case, the whole process of setting up a designated authority could obviously be called into question. We are seeking the power to be exercised by the designated authority and for the Secretary of State to be kept at a distance. I hope that that commends itself sufficiently to the noble Lord for him to feel that his amendment can be safely withdrawn.

Amendment 255 refers to the section which makes clear what is covered by a classification certificate and what the certificate relates to. This is particularly pertinent to video games because a change in format can lead to a different perception and impact of the game. This is a practical and effective measure to take account of existing and future formats in a changing technology. It means—this is the most readily appreciable reason why this section is as it is—that publishers will not be able to take several already classified works, cut them and repackage them in a new way and then seek to rely on the previous classification certificate for the work in question. We all know that such cutting and pasting, although the process is slightly more sophisticated than that phrase suggests, can change content. That is why we are seeking to ensure that if changes of that nature are effected, the designated authority could make a new specification if it felt the need to do so, although it does not have to.

I say to the noble Lord, Lord Howard of Rising, that the present section will commend itself because it is permissive. The designated authority does not have to act, but if it felt the need was there to act, it has the power to do so, which is why I want to defend the section as it stands and to resist Amendment 255.

I give belated but sincere congratulations. I was so worried about the out-of-character action that I completely forgot to give my applause, which I now do belatedly. I hope that the Minister will accept it. I also bow to his much greater knowledge of video games than mine. I do not know when he finds time to play them, but I accept his explanation and beg leave to withdraw the amendment.

Amendment 254 withdrawn.

Amendment 255 not moved.

Amendment 255ZA

Moved by

255ZA: Schedule 1, page 53, line 25, at end insert “and insert—

“(2) Regulations under this section may require content advice issued with the classification certificate by the designated authority to be shown in a manner so specified.””

My Lords, this amendment would ensure that consumer advice is added to every video work, along with the classification. The inclusion of voluntary consumer advice has become widespread and provides a useful tool for consumers.

The type of material a person finds offensive or unpleasant varies enormously. Some people object to watching violence while finding explicit sexuality acceptable. Others are exactly the opposite. Many parents would not mind their children being exposed to a single use of a swear-word but would find a profanity-filled film too much. Consumer advice is a quick and simple way to see what sort of material triggered the classification. Since the BBFC automatically writes consumer advice for every work it classifies and the size of the classification label remains the same whether or not the advice is included, it is no surprise that the majority of major producers include the advice as a matter of course. Indeed, it is hard to think of a reason why a producer would not include the advice except where, as has happened occasionally, it is to the production company’s commercial advantage that people do not know the full story about what they are buying. I beg to move.

My Lords, once again the noble Lord is reflecting his authoritarian instincts and seeking to make compulsory that which at present is mainly advisory and permissive. The Government are, of course, concerned that the BBFC and the VSC need to make their classification on DVDs and games clear. Additional advice is at present permitted and often welcome as a way of providing additional information to consumers. Most DVDs and games provide sufficient information about the contents to allow the consumer to make an informed choice. After all, if the consumer buys something which he did not intend to buy, his reaction is likely to be very critical of the provider. There is absolutely no evidence to suggest that making additional advice compulsory would provide any additional protection.

There was no call for compulsion in this area during the extensive consultation we undertook before drawing up the legislation. It is an extra imposition on industry, especially given that there is no restriction on what the designated authorities might impose. So the noble Lord might, in fact, be proposing an excessive demand on the industry because he is leaving it to the designated authorities to make that judgment. We believe that there is some benefit in additional advice and it is often provided to the advantage of the consumer. However, we do not see the case for making it compulsory beyond the necessary certification advice which is already provided for. I hope, therefore, that the noble Lord will return to his normal bent and feel that his amendment ought not to put an extra burden on industry where it is not necessary.

I thank the Minister for his remarks. I do not think it would be a burden on industry but I am so upset about him calling me authoritarian that I cannot put my argument very well. My amendment is meant to provide a form of practical assistance with the proliferation of unsuitable material which we have been talking about quite a lot recently. I beg leave to withdraw the amendment.

Amendment 255ZA withdrawn.

Schedule 1 agreed.

Amendment 255A not moved.

Clause 42 : Extension and regulation of licensing of copyright and performers’ rights

Amendment 255B

Moved by

255B: Clause 42, page 46, leave out lines 4 to 42 and insert “30 insert—

“Extension and regulation of acts permitted in relation to copyright works30A Orphan works

(1) The Secretary of State may by regulations provide that acts in relation to an orphan work which would otherwise require the consent of the copyright owner may be done notwithstanding the subsistence of copyright.

(2) A work shall become an orphan work when the copyright owner cannot be found.

(3) The burden of proof that the copyright owner cannot be found shall be on the person who publishes the orphan work, and the burden shall be discharged by proof that a diligent search to identify and locate the copyright owner has been undertaken and has not been successful.

(4) Fair dealing with an orphan work shall not infringe copyright.

(5) The work shall cease to be an orphan work when the identity and location of the copyright owner becomes known.

(6) The regulations may provide for determining the rights and obligations of any person if a work ceases to be an orphan work.

(7) The copyright owner shall be compensated in an amount equal to the licence fee he would have received had he been identified at the time of publication and he shall be entitled to aggravated damages if the person who publishes the work is unable to discharge the burden of proof described in subsection (3).

(8) The regulations may provide for the Secretary of State to determine whether any requirement of the regulations for a person’s becoming or remaining authorised has been met or ceased to be met.

(9) In this Part references to a work as, or as ceasing to be, an orphan work are to be read in accordance with regulations made by the Secretary of State.

(10) Regulations under subsection (6) may operate by reference to guidance published from time to time by any person.””

My Lords, as this is the first time I have spoken at this stage of the Bill, I declare an interest as a non-executive director of the Bridgeman Art Library, which is a photographic archive, and a member of the British Association of Picture Libraries and Agencies and the Creators’ Rights Alliance, both of which have briefed me but not on this amendment. I shall not be pressing Amendment 255B in the name of my noble friend Lady Buscombe and myself since it is a probing one, but I wish to speak briefly to it because some important points are associated with it.

In addressing the orphan works problem, there are some honestly held differences of opinion between the licensing approach in new Clause 116A and the exceptions route represented by Amendment 255B and new Clause 30A. It is clear from contact that I have had with interested parties to the Bill that the licensing route is the option favoured by the majority, but by no means all, of stakeholders. I am well aware that all sides of your Lordships' House wish this Bill to pass into law in this Parliament, which is the basic reason why I shall not press my amendment at this stage. I am also cautiously reassured by the intentions expressed in the Government’s recent briefing paper that there will be wide consultation in connection with the framing of the regulations and the code of practice that will derive from them. I thank the Minister for facilitating a meeting with his officials and the Intellectual Property Office, which I gather will be responsible for drawing up these regulations. However, some important aspects are associated with this amendment, which I hope that the Minister will take note of for possible considerations in the later stages of this Bill and in the crucial task of framing the regulations.

The proposed Clause 30A would be an additional permitted act to set beside those already set out in Chapter 3 of the Copyright, Designs and Patents Act 1988. It is effective, inexpensive and entirely consistent with a cornerstone and the existing structure of copyright law, which goes back centuries, in that it preserves the integrity of the exclusive right to copy. This is the foundation of copyright. As it stands, Clause 116A alters the basis of copyright law, which confers on the first owner an inalienable right until he voluntarily parts with it. The exceptions route achieves the objective without depriving the owner of his or her property rights. Secondly, it places the burden of proof for establishing orphan status where logically it should belong—with the user—and not in the hands of a third party, a licensing body. In this, it contrasts with Clause 116A, in which a third party, namely a licensing body, can be interposed between copyright and owner. The owner can lose control of his copyright. It is a basic point, which this House should be aware of. I am also aware that that point is addressed in a new clause recently tabled by the Government, so I am grateful for that.

I make it clear that the ambit of the exception should be confined to institutions approved by the Secretary of State and would be aimed at those who hold the major collections of orphan works. The composition of those collecting societies is covered in amendments about to be discussed. There is nothing to prevent these institutions from combining together to create their own licensing body. Clause 30A is but one of a number of alternative solutions to the orphan works question. In not moving it, I am pleased to put my name to those amendments in the range Amendments 260 to 272, in the names of the noble Lords, Lord Clement-Jones and Lord Razzall, which should have the laudable effect of improving certain aspects of the clause as currently drafted.

I make two further important points. The first is that straightforward procedures are put in place to enable the rights owner to assume control of this work once he or she has made himself known. The standard of proof required to establish title should be reasonable—and again I have to concede that the new government amendment refers to that.

In the Times of the past week, there have been two letters, one from the curators or leaders of the majority of the major museums in this country, supporting the present proposal. It was followed today by a letter written by the executives of institutions representing a large body of creators who have grave concerns about this Bill due to the possible exploitation of their members’ rights by unscrupulous users. I know that my noble friend Lady Buscombe will speak further on that matter. Those settling the secondary legislation must bear in mind that monopolies or quasi-monopolies by collecting societies should be tolerated only as long as such structures are the only means of protecting effectively the rights of individual owners. I beg to move.

The point is probably academic, but if this amendment were to be passed, I could not call Amendments 256 to 282AZA by reason of pre-emption.

My Lords, I rise to speak in support of Amendment 255B, to which my name is added. Clause 42 delegates to the Secretary of State the power to settle regulations which will transfer a property right, the right to copy, from one person to another without consent. This is, in jurisprudential terms, a very significant derogation from widely accepted principles of law.

I entirely accept, and indeed very much support, strong arguments for broadening public access to art works which are currently restricted by copyright law. However, unless the regulations are created with clear and adequate safeguards, the impact on the creation and dissemination of visual arts will be significant.

A very positive aspect of Clause 42 is that it has generated considerable discussion and debate beyond your Lordships’ House, and highlighted some crucial aspects of copyright law which have been referred to by my noble friend Lord Bridgeman, and which I very much hope the Government will address in drafting the regulations.

My noble friend referred to two letters published in the Times: one of 3 February with the headline, “Unlock collections for digital access to all”, and another from today, “We must not jeopardise the fundamental rights of their creators”. These letters explain why my noble friend Lord Bridgeman and I believed it important to propose a route to broadening public access to art works which are currently restricted by copyright law, while seeking to protect the fundamental rights of their creators. To those who care only for freeing up access for all, without regard to the future commercial viability of creators, I say, “Be careful what you wish for”. As it stands, Clause 42 does not achieve this necessary effect.

While I am conscious, as all in your Lordships’ House are, of the desirability of seeing this Bill passed, we must do all in our power to avoid unintended consequences which may do more harm than good—particularly in the longer term, given that none of us can predict where technology will take us and thereby test the boundaries of copyright in years to come.

My Lords, my noble friend Lord Addington and I did not make ourselves available for the digital economy tour, but we turned up and therefore were pressed into service in the absence of three of our noble friends.

These amendments in the names of the noble Lords, Lord Clement-Jones and Lord Razzall, endeavour to enhance this clause on the licensing of orphan works. Clearly, my noble friends are unhappy with the looseness of proposed new Section 116A, and believe that it needs strengthening.

The noble Lord, Lord Davies of Oldham, will recall that we dealt with orphan assets on a previous occasion and another Act: the Dormant Bank and Building Society Accounts Act. Much of the discussion during the passage of that Act was over the worry and concern about assets being reunited, and in Amendment 272 to this Bill, for example, there is reference to the orphaned work and the copyright owner being “searched for”.

There are now several amendments to Clause 42, and there is real concern about whether and how, once the author returns, these matters will be dealt with. These amendments are the work of my noble friends, not me, and I place them before the Committee.

My Lords, I am very grateful to the noble Viscount, Lord Bridgeman, and the noble Baroness, Lady Buscombe, for acknowledging that we have here a problem that needs a sensible, civilised and practical resolution. It is very important that masses of material that is in some of our great national collections should be released so that it becomes available for scholarly, educational or other cultural uses in the public interest. I do not think that anybody desires to deprive rights holders of their legitimate rights, but we are talking about orphan works that are, by definition, works where rights holders cannot be identified or traced. We need to acknowledge that this is a very large-scale problem.

In a speech to the ALAI congress last year, the chief executive of the British Library, Dame Lynne Brindley, explained just how significant this issue is to the British Library, which has estimated that over 40 per cent of its archive collections may be orphan works. That figure was corroborated by a recently released international study entitled In from the Cold, which found that up to 50 per cent of works in large archives were orphan works and, indeed, that in excess of 50 million orphan works were held in somewhat more than 500 organisations which were surveyed. A huge amount of content is thus effectively off-limits under the way that copyright law is at present constructed. It is hence accessible only with difficulty, providing little value or benefit to anyone. I am sure that the Committee will agree that it is highly desirable to find a workable solution to this problem, while balancing the legitimate rights of rights holders.

British Library staff, the chief executive said, have spent literally thousands of working hours trying to identify rights holders who often cannot realistically be found and probably do not exist. For example, in one oral history project involving a series of unpublished interviews held in the 1960s and 1970s at St Mary-le-Bow church in the City of London, 302 hours were recorded as being spent by British Library staff and their paid contractors in looking for 259 rights holders. Some of those rights holders were famous and easily identified, but many were local teachers, bankers, clergy or professionals who, all those years afterwards, could not be tracked down.

Despite all the time and trouble that the library took, it was only able to locate 14 of those rights holders, all of whom then gave permission for their material to be used freely. Much of that material is of considerable potential educational and scholarly value, but of no commercial value; it was never created with commercial value in mind. Spending so much time on fruitless searches for rights holders is really not a sensible or, I would suggest, a proper use of public resources—a very important question in these times of financial stringency. It is not surprising, then, that much of the cultural sector is agreed on wanting an exception in copyright law for orphan works.

It is essential to maintain legal and reputational certainty for libraries, archives and museums, which are putting parts of their collections on the web, and to enable that material to be released into use. It therefore seems to me that whereas collective licensing and collecting societies are important for commercial purposes, we are talking of non-commercial, educational, scholarly and cultural purposes. Those should be treated differently in the public interest, and it is right that an educational or cultural body should be able to receive a licence from the Secretary of State, as the Government propose—and, as I thought, was compellingly argued in the letter in the Times of 1 February, signed by 26 leading figures from the educational, research and cultural sectors.

I was surprised by the tone of the letter in today’s Times from the distinguished writers and publishers, who said that the Bill would allow any individual or institution, regardless of their motivation, to conduct a rudimentary search, decide that a work appears to be orphan, and license themselves on that basis to exploit it. However, Clause 42 envisages that the Secretary of State would use regulations to govern the manner in which those licensed may proceed. Schedule A1 would confer on the Secretary of State power to provide for codes of practice relating to licensing bodies and the regulation of licensing bodies and of other persons authorised.

It seems that the Government have recognised a real problem, put forward a sensible and decent solution, which will allow important cultural resources to be released and made widely available for the public benefit, while not jeopardising legitimate copyright interests. I am happy with the government amendments. I personally hope that the House will reject amendments that seek to unravel this well constructed measure.

We are not talking of fly-by-night pirates but of the professional staffs of the British Library, the National Libraries of Wales and Scotland, the national museums, the Wellcome Foundation: people of profound scholarship and professional scruple, who naturally respect copyright as essential to the academic edifice, the creative endeavour and the publishing industry. It is very odd to suppose that they would play fast and loose. They have powerful protections for copyright carefully built into their operational systems and have been wrestling strenuously and conscientiously with copyright issues in the digital era.

Within the framework proposed by the Government, if a rights holder turns up after their work has been exploited as orphan, they will receive fair compensation. The licence would only be granted on this basis. Libraries, knowing the background of their collections, may well be better placed to search for a rights holder of, say, private diaries, a locally published history or hand written letters or notes than a collecting society representing—very competently and appropriately as they do—mainstream commercial material. The Government’s proposals seem well balanced.

My Lords, I take issue with the noble Lord, Lord Howarth. He was suggesting that we did not have orphan works in mind at all. In fact, the exception proposal is exception from copyright. So, at that stage, anybody using an orphan work would not, in that respect, be infringing copyright. The requirements to search are common to both routes. I would be delighted to continue elsewhere.

My Lords, the Government have finally accepted, late in the day, that something needs to be done to address a long-running problem. However, unfortunately, they have failed to work out a solution or done the necessary preparatory work before coming to Parliament to demand extensive new powers. The question of whether orphan works should be licensed and used and the best way to do that has been around for many years. For some time, there have been calls for government action on this point. There has been plenty of opportunity to produce properly thought-out legislation rather than what we debate today.

Many stakeholders have welcomed this clause with enthusiasm. It must have been deeply frustrating for organisations storing endless corridors of fascinating material which cannot be used, distributed or displayed. I sympathise with their relief that finally these treasure troves will be opened up. However, that relief should not cloud the consideration of whether the final scheme is appropriate, fair or sensible. The desire to use genuine orphan works must not lead to any weakening of legitimate copyrights. Such a move would be deeply unfair and would sit most uncomfortably with the first part of the Bill, which is all about protecting copyright.

So far, the Government have told us little about how an orphan works scheme will operate. Any safeguards in this Bill, such as the code under which the licensing bodies might operate, are optional. There is nothing in the Bill, as currently drafted, to require a licensed body to make appropriate efforts to find the copyright owner, nor to require that copyright owners will be suitably recompensed if they turn up. Indeed, there is no guarantee that the scheme will do what it is intended to do, which is to allow organisations to use orphan works without fear of future legal action. The noble Viscount’s amendments make a good start in filling in some of these blanks. I look forward to hearing the Minister’s response.

My Lords, I apologise in advance for giving a lengthy reply, but this is the first time we have debated this issue and it merits such a reply. I thank the noble Viscount, Lord Bridgeman, for his constructive approach to this matter.

This group of amendments appears to have three objectives. The first is to insert a definition of “orphan works”, including requirements for a diligent search. The Government genuinely sympathise with the intention of this amendment, and, taking on board the report from the Delegated Powers and Regulatory Reform Committee, have tabled Amendment 282AZA, which we shall discuss later. I believe that this new definition provides for the diligent searching which the amendment seeks to achieve, so I would urge noble Lords to consider withdrawing it.

The second objective of the group of amendments is to make provision for payment for use of orphan works, including an indemnity for the user. I understand that the intention of these amendments is to clarify how payment for use of orphan works would work in practice. The Bill gives the Secretary of State powers to deliver a solution to the long-standing problems caused by orphan works, and this includes powers to make regulations dealing with royalties paid for the use of orphan works. As I say, we intend to define those in regulations. There will be full consultation on the regulations later in the year.

Amendment 265 requires the person authorising the use of an orphan work to indemnify its licensees for any liability they incur through use of the orphan work. As authorisation gives consent for the use of an orphan work, any licensee will not infringe copyright, so an indemnity would serve no purpose. It is worth making it clear that, as I said, the Government are committed to engaging in extensive and full consultations with interested parties to inform the final shape of the regulations—the noble Baroness, Lady Buscombe, referred to that—that will govern orphan works schemes. We fully understand the importance of those. The regulations will ensure that we get the balance right between the creator and the desire to share these orphan works with the public at large.

The third and final issue in this group of amendments is raised in the definition introduced by Amendment 255B, which seeks to provide that fair dealing in an orphan work does not infringe copyright. As drafted, Clause 42 inserts powers to make regulations providing for the use of orphan works. There is a power to make consequential amendments to the Copyright Act inserted by Clause 42, but at present there is no intention to alter the exceptions contained in that Act. Again, any changes to the current system of exceptions, if that were proposed, would be introduced only after full consultation.

The noble Viscount, Lord Bridgeman, talked about the two letters to the Times, one of which was welcoming and the other of which expressed concern. I can understand the concern. This is a big step. We are all seeking to get the balance right without destroying any creator’s rights. I do not think that I could have put it any better than my noble friend Lord Howarth who talked about the mass of material in the British Library, something like 40 per cent of it being orphan works. The situation was perhaps even more graphically described by the noble Lord, Lord Howard, who referred to the treasure troves. Indeed, they are treasure troves. We have no intention of weakening legitimate copyright.

The letter in the Times said that any institution can set itself up and after a rudimentary search declare a work orphan. That is not true. My noble friend Lord Howarth described the position correctly. Bodies will have to be authorised and regulated and will have to carry out a diligent search as defined in the government amendments. These safeguards will protect the rights of absent rights owners. If I were them, I could understand why they would write that letter, because if they have any doubts at all, they want to get the point home to the Government. In a desire to express their concern, they have made a rather simplistic, inaccurate description of what will be required. It is not the case that anyone can set up this body, do a quick search and orphan works will be declared. Nothing could be further from the truth.

I have referred to the subsequent government Amendment 282AZA, in which we took on board comments from the Delegated Powers and Regulatory Reform Committee. I hope that in the light of the explanation and the assurances that I have given, the noble Viscount will feel able to withdraw the amendment.

My Lords, I have clearly been unsuccessful in persuading the Minister and the noble Lord, Lord Howarth, that this provision facilitates the exploitation of orphan works incidentally without the expenses payable to a third party. It is a direct contract between the holder of the image and the user. I am sure that this matter will be revisited at later stages. In the mean time, I beg leave to withdraw the amendment.

Amendment 255B withdrawn.

Amendment 256

Moved by

256: Clause 42, page 46, line 8, leave out “or other person”

My Lords, in moving Amendment 256, I will speak also to other amendments in the group. Essentially, the amendment is designed to probe the intentions of government regarding those bodies other than collective licensing schemes which the clause appears to permit. The noble Lord, Lord Howarth, is correct that it is entirely valid for many cultural organisations to have the ambition to be licensing schemes. However, no distinction appears to be made between commercial and cultural organisations. That is the fear at the root of the clause. No doubt all of us will have more to say on later amendments. In the absence of proper reassurance from the Government that there is a distinction to make between commercial and non-commercial organisations, the amendment is designed to say that the only licensing organisations should be those run by copyright holders.

We now seem to have a definition of an orphan work which is much more satisfactory. No doubt we will come to that in a moment when we consider the government amendments. There is no doubt that the clause has been improved, but these amendments are designed to deal with a number of clarifications in terms of the sorts of administrative costs that could be charged by a collective licensing body and so on. A great deal could be said here, and no doubt we will use the amendments as we go through our proceedings to explicitly talk about further aspects. This group of amendments is about the right for others, which are not collective schemes, to be licensed. It is extremely important that the Government give reassurance on that matter, particularly regarding commercial organisations. I beg to move.

I agree entirely with the concerns of the noble Lord, Lord Clement-Jones, as to the nature of the licensing bodies. As with so much else in the Bill, there are endless questions to be answered about the make-up, numbers and priorities of the bodies, not least the difference between commercial and other organisations as mentioned by the noble Lord. How many authorisations does the Minister anticipate making in the first round? Are we looking at a few large bodies or will there be numerous smaller ones? Will there be any sort of review process to establish whether an authorised body is operating well or will the Secretary of State rely on industry complaints to identify a problem?

Noble Lords are also right to highlight the conflict of interest that might well arise if an authorised body’s primary concern is to make available as much material as possible. In no way should those provisions be used as a convenient route around a reclusive or unco-operative copyright owner who has no wish to license his material out or engage in a discussion with a licensing body.

Amendment 273 was suggested by the British Library, which had some understandable concerns about this mysterious person who would be issuing guidance. It wanted to ensure that the guidance will be produced by someone with an understanding of public and private interests and so be able to produce a balanced view. I hope the Minister will take this opportunity to give a little more explanation as to what this guidance might consist of.

This group of amendments seeks to limit eligibility for authorisation to use or license the use of orphan works. It also seeks to ensure that licences and authorisations for orphan works are non-exclusive. I shall explain the difficulty that this will create.

A lot of historical and archived material contains one or more orphaned rights. The average number of orphaned works in public sector collections is estimated at some 5 to 10 per cent. The British Library, as we have already been informed, tells us that some 40 per cent of its collection is orphaned while the BBC has roughly 1 million hours of programming which is similarly orphaned and cannot currently be used. That gives the Committee some idea of the scale of orphaned works.

The inclusion of “other person” in the current wording of new Section 116A of the Copyright, Designs and Patents Act introduced by Clause 42 would allow these organisations to be authorised to use or license the use of the orphan works in their own archives. Limiting the scope to licensing bodies would mean that these organisations would have no option but to rely on an authorised licensing body when they might wish to operate their own schemes. As I have already said, the conditions for eligibility to use and authorise the use of orphan works will be considered fully as part of the Government’s consultation and the regulations made will be informed by it. There will be a full consultation between all appropriate parties before we draw up these regulations.

We believe that it would not be right at this stage to rule out the possibility of certain large, respected, not-for-profit institutions, particularly those funded by public money, administering some schemes themselves. For these reasons, too, we do not believe there is any need to restrict those eligible for authorisation or to insert a new definition of licensing body into the Copyright, Designs and Patents Act as Amendment 269 seeks to do. Amendment 256A is unnecessary as new Section 116A(2) of the Copyright, Designs and Patents Act, inserted by Clause 42, provides that both authorisations and licences granted under them are non-exclusive. I hope that Amendment 273 has been addressed by a government amendment that we will address in a later group of amendments. It removes the possibility of orphan works provisions operating by reference to guidance issued by third parties.

The noble Lord, Lord Howard, asked how many authorised licensing bodies there would be. Our view is that it is a question of not how many, but how well regulated the bodies are. We stress that what is important is not the amount, but ensuring that they are properly regulated and understand that they must take a balanced approach. In their desire to release orphan works, they must not neglect the need to search for the possible owners of the works, regardless of how reclusive they may be. Nobody is suggesting that they should opt out of that process.

I hope that, with those explanations, noble Lords will not press the amendments in this group.

My Lords, I thank the Minister for that reply. I feel that a strong attempt is being made by the Minister and his team to answer the criticisms, but that they are not addressing the crucial point. I hope that the Minister has read the letter in the Times today that expresses some of these fears. There is no issue about cultural organisations. We have all had correspondence from the British Library, the Natural History Museum and the directors of many museums. There is no issue about allowing those organisations to exploit their archives for their own educational or cultural purposes and for orphan works to be dealt with in a proper manner. There would be no great fear if those cultural organisations had their own collecting societies. The problem is the threat of commercial organisations using orphan works without due diligence.

I thank the noble Lord for giving way. As I looked at my note, I realised that I had not referred to the concern about commercial organisations. I will address the distinction between commercial and non-commercial cultural organisations. We understand that different sectors have different needs. The clause gives us the flexibility to set the right framework for different types of use. After all, there is no such thing as a clearly defined non-commercial body. For example, the BBC covers both commercial and non-commercial uses. The regulations will be flexible enough to allow for this. We must get the regulations right, so that we do not allow a commercial body to exploit works in a way that is unregulated and unlicensed, and disturbs the balance that we are trying to achieve in these regulations.

My Lords, we are a long way away from getting a sensible resolution to this. That was a valiant attempt by the Minister. I agree that there are problems with definition, but Clause 42 is such a broad clause. It is controversial in the view of many people; for example, freelance photographers. They, along with the Royal Photographic Society, have made strong representations. Later we will discuss amendments that deal with their interests. The Government must think more carefully about how the clause can be refined. We know that there will be a problem in the other place, where Members will not have time to debate the issues. We will have what is traditionally called the wash-up at the other end. I will say that parts of the Bill will have a much easier passage than this set of proposals. I would hate these proposals to fall in their entirety because I believe it is highly frustrating for the British Library and for other cultural institutions not to have these orphan rights properly spelt out. Gowers talked about orphan rights and so on and so forth. It is not as if there is not some pedigree for orphan rights proposals and for them to be dealt with. The Government have not, however, spelt out in the way they should how these orphan rights will be limited in their scope and how these collecting societies and other licensees—licensors, I suppose I should say—are going to be dealt with.

As these amendments go through, we will continue to express dissatisfaction with this clause for entirely understandable reasons without wishing to sound as though we are trying to do down the cultural institutions that many of us value very highly.

My Lords, before the noble Lord sits down, perhaps I may add briefly—I entirely agree with everything the noble Lord, Lord Clement-Jones, has said—that the issue does come down to a different situation, whether it is commercial or non-commercial. I take issue with the suggestion from the noble Lord, Lord Howarth, in the previous amendment that somehow we are not focusing—of course we are—on the important issue of freeing up orphan works for educational purposes and so on. There is a strong issue here and I am so grateful to noble Lords, including my noble friend Lord Bridgeman, for raising these issues in debate. Clause 42 is too simplistic. It is approaching copyright as an all-encompassing law, as if copyright relating to music is the same as copyright relating to images. It is rather more complex than that. Because of that, I am concerned that we may be leaving too much to regulation. I wish there was a way that we could improve the Bill rather than leaving all this to regulation as it is too important to get it wrong. We have waited years to address this issue. Although we are grateful to the Government for taking this issue on board, let us please work at it to get it right.

My Lords, I want to give some assurance. We understand the importance of getting this right and we will reflect carefully on this debate, especially in relation to the commercial aspects. Just because we are resisting these amendments is not to say that we will not reflect on the issues that have been raised.

Amendment 256 withdrawn.

Amendment 256ZA

Moved by

256ZA: Clause 42, page 46, line 10, at end insert—

“( ) Regulations under subsection (1) shall only provide for authorising a licensing body that represents a substantial number of authors or, as appropriate, performers of the type of works for which the licence is to be granted.”

My Lords, this is a disparate group of amendments. Amendments 256ZA and 276A both carry on the criteria for collecting societies and are intended for the benefit of the framers of the regulations. They are designed to ensure that the collecting societies are accustomed by their work to dealing with the sort of institutions for which they will be granting licences. Amendment 259A was our attempt to frame the definition of due diligence, which again has been covered by the government amendment. I hope the Government will consider that amendment with any others when finalising that definition in the later stages of the Bill.

Amendment 280A is a special amendment relating to libraries. It seeks to ensure that libraries are properly defined as public libraries which are defined in legislation. They are wholly owned trading subsidiaries. It is designed to ensure for instance that institutions such as the British Library fall within that but that possibly the search engines which are there for commercial purposes do not.

Finally, on Amendment 282A, I detect a whiff of a Henry VIII clause in new Section 116D(2)(b) on the power,

“to make different provision for different purposes”.

The amendment relates to the subjects that are covered in new Sections 116A and 116B. I beg to move.

These amendments raise very important issues. Probably the most important issue, despite the Government’s introduction of a requirement for the search to be “reasonable”, is how much diligence is applied to the search for an orphan work.

The European Digital Libraries Initiative set of EU guidelines on what constitutes a diligent search is a remarkable and comprehensive document that is extremely useful. It came rather too late to table an amendment to reflect it, but I believe that “diligent” should be used instead of “reasonable” in relation to a search. One of the ways in which the Government could provide greater reassurance in Clause 42 in particular is by ratcheting up the amount of diligence that is required on a search. The British Library, the National Libraries of Wales and of Scotland and the European Library have been consulted on this document, so I think it has quite a lot of acceptance in the cultural sector. I wanted to highlight it, rather sneakily, in our debate on this set of amendments. I could not speak in our debate on a previous group of amendments, so this was a convenient moment in which to mention this set of guidelines.

I omitted to remind the Committee that Amendment 280A is also aimed at commercial partners who seek to piggyback on a public library to get in on the act. The amendment is designed especially to prevent that.

I do not really understand what Amendment 280A is about. What is wrong with commercial partners exploiting a copyright?

It is one thing to have an extended licensing scheme for a body that already has a particular work that it needs to exploit in different formats over time and another to have a completely new work over which it tries to acquire rights through this process. If the BBC has a programme that it wants to exploit over new media, such as an iPhone, but it does not have the right to do so, I can understand the need for a collective licensing scheme. However, some circumstances need to be narrowed. This is not some free for all. The circumstances must be narrowed to the particular purposes for which the case has been made and not for purposes for which the case has not been made.

We are coming up against what will prove to be impossible over the next decade or two: maintaining the idea that the copyright owner has control rather that a right to remuneration. I do not see how control stands in the internet age.

For the wholly owned subsidiary that is a trading subsidiary of a charity that cannot trade on its own account, commercial exploitation will be open to that subsidiary in any form.

My Lords, on Amendment 256ZA, there is no good reason at this stage to exclude, for example, libraries and archives from applying for authorisation to use or license the use of orphan works. I understand the concern expressed by the noble Viscount, Lord Bridgeman, about ensuring that libraries are properly defined. I must admit that in the light of our previous comments about commercial partners, I tend to share that aspect of the contribution of the noble Lord, Lord Lucas, though I am not sure that I would go quite as far as he did on the question of control.

These organisations have acted as foster parents to large numbers of orphaned works and may have specific expertise that could mean that they are best equipped to use or license the use of orphan works. They may ultimately decide to use licensing bodies to run their orphan works schemes if that proves more efficient, but that is for the market to decide. I know that the noble Lord, Lord Clement-Jones, has been concerned that we are not getting this right in terms of sufficient provision in the Bill for finding the copyright owner before a work is declared orphaned. He has expressed his concern about what is reasonable and diligent and I do not dismiss it.

However, the Government have tabled amendments to specify what must be done to satisfy the requirement for a reasonable search. Perhaps we will reflect on “diligent”, but we have endeavoured to meet that. This includes looking at a number of sources, including licensing bodies, associations of publishers or authors, systems for identifying works of the type concerned, published library catalogues and indices, and public databases. The requirements for the search—this is very important in the light of what was mentioned—are in line with best practice, including the guidelines developed by the European high-level expert on digital libraries, as referred to by the noble Lord, Lord Clement-Jones.

Licensing bodies authorised to set up extended licensing schemes will be expected to give wide notice of the establishment of their individual schemes. Previous reference to this has been made, including, for instance, schemes concerning different mediums, one of which was photography. They will also be expected to give wide notice of the distribution of royalties. This should give copyright owners, including photographers, ample notice and opportunity to come forward. In addition, it is expected that authorised licensing bodies will have obligations to seek out copyright owners in order to reimburse them for the use of their works. It might be better to say that licensing bodies carrying on extended licensing can be subject to regulation, including requirements to operate a code of practice, and to have an ombudsman for dispute resolution. These safeguards will work to ensure that rights holders’ interests are respected. I hope that this more detailed explanation is helpful.

I have dealt with Amendment 259A, which seeks to insert a requirement for diligent search. In response, as I said on the recommendations of the Delegated Powers and Regulatory Reform Committee, we have tabled amendments which include the insertion of a definition of orphan works into the copyright Act. They provide that a person may classify a work as orphan only after he has conducted an extensive search for the copyright owner. On Amendment 276A, I must stress that extended licensing, where it operates in the EU, is based on the principle of extending the repertoire of a licensing body which represents a critical mass of rights where it is in the public interest to do so.

On Amendment 280A, we do not see any justification for limiting the availability of licences to public libraries. We consider that licences available under extended licensing schemes should be available to all. Similarly, on Amendment 275A, there appears to be no justification for providing in proposed new Section 116B of the copyright Act that extended licensing cannot be used in relation to certain categories of works. I reassure the noble Lord by reiterating that the Government will consult fully on the exercise of these powers in proposed new Section 116B of the copyright Act before they are exercised. This consultation will include issues such as conditions for authorisation and the extent to which a licensing body is representative of copyright owners within a certain area. It would be premature to define representation requirements on the face of the Bill. For that reason, I would ask the noble Lord to consider not pressing his amendment.

Amendment 282A seeks to limit the exercise of the power to make different provisions for different purposes to proposed new Sections 116A and 116B and Schedule 1. That limitation already exists in proposed new Section 116D(1). I hope that this will reassure the noble Viscount, Lord Bridgeman, and persuade him not to press this amendment.

I am grateful for the Minister’s reply to a wide variety of amendments. I beg leave to withdraw the amendment.

Amendment 256ZA withdrawn.

Amendment 256A not moved.

Amendments 257 and 258 had been withdrawn from the Marshalled List.

Amendment 259 and 259A not moved.

Amendment 260

Moved by

260: Clause 42, page 46, line 14, leave out “may” and insert “shall”

I must have spoken already to Amendment 260 and to some of the other amendments in this group. These amendments are designed to tighten up the way in which royalties will be paid. Sometimes debates on “may” and “shall” are somewhat fruitless but this House is very good at them. As we need reassurance for these rights holders, despite what the noble Lord, Lord Lucas, said, it is extremely important for the freelance writer, composer, creator, photographer and so on to have the reassurance that there will be a payment of royalties and that all these other amendments to the clause will be made. The Minister has so far been quite sympathetic to some of the points made. I hope that, as part of his review of this clause, this sort of detail will be considered. I beg to move.

The lack of detail in the Bill regarding the money issue is worrying. The Government have indicated that the matter will be resolved by consultation. However, as earlier provisions in the Bill show, when it comes to the fair division of costs and revenues, sometimes there is no agreement. If there is a deep and irreconcilable conflict between copyright owners and wannabe licensees, the Secretary of State will have to pick a middle ground. Can the Minister give us any more details of what sort of principles the Government will follow when passing regulations in this area? Who will ensure that the administration costs charged by the licensing bodies are fair and not excessive? Will there be any process of checking that royalties are being collected and retained properly? How long does the Minister think that bodies should be required to hold on to those royalties?

Amendments 261 and 262 seek to insert some of the detail on orphan works into the Bill. The Government have had ongoing discussions with stakeholders on this area of policy and have committed to a full and wide-ranging consultation to inform the detail of the orphan works regulations. This consultation will allow the Secretary of State to ensure that the use of the powers in Section 116(3) results in a workable system for the deduction of costs that are reasonable, and it will also deal with the issue raised in Amendment 262 as it will inform the correct determination of the period for which royalties should be held.

Amendments 264 and 267 seek replace the word “may” with “shall” to make it mandatory for certain matters to be included in the secondary legislation covering the operation of orphan works schemes. Permissive language has been used to reflect the Government’s commitment to consultation before finalising the regulations.

On the specific points made by the noble Lord, Lord Howard, on royalties and costs, we shall write not just to him but to all who have participated in this debate to see whether we can put a bit more flesh on the bones. In light of those comments and assurances, I hope that the noble Lord will feel able to withdraw the amendment.

I thank the Minister for his interesting reply that the language cannot be in Bill so that the consultation can be that much more flexible. There are circumstances where having something in the Bill provides the kind of reassurance necessary, and I suspect that any rights holder consulted on this aspect would say that he would like to have some certainty. I do not think that the Government are doing anybody any favours by not having this language in the Bill. I hope—as with other aspects of this clause, and it is becoming quite a long list—that the Minister will consider this for inclusion despite the point he made about wanting to have permissive language, because that is not something that all those rights holders would want. I do not wish to torture the Minister any further, so I beg leave to withdraw the amendment.

Amendment 260 withdrawn.

Amendments 261 to 265 not moved.

Amendment 265A

Moved by

265A: Clause 42, page 46, line 22, leave out “a work ceases to be an orphan work” and insert “an interest in copyright ceases to be included in an orphan works register (see section 116BA)”

My Lords, we now move on to a large group of government amendments to Clause 42 that take into account a number of discussions and comments. I shall not go through each and every amendment in detail as there is a substantial amount of repetition between the parts and I take into account the time, but I feel it is important to outline in brief the purpose of the amendments and their intended effect.

This clause as originally drafted was intended to strike the right balance, as we have said many times during this debate, between marking the limits of what the Government consider appropriate in this area and maintaining enough flexibility to allow full consultation with affected parties before details are fixed in the subsequent regulations. The Delegated Powers and Regulatory Reform Committee highlighted a few areas where it thought we had not quite got the balance right, and these amendments are intended to address those concerns.

In brief, these amendments provide for the inclusion in the Bill of a definition of an orphan work, subject to amendment by regulations made by affirmative procedure. This will provide greater certainty for those concerned about the scope of these provisions. The amendments remove the ability of the Secretary of State to refer to guidance produced by a third party when defining “orphan works” in secondary legislation. The definition is instead detailed in the Bill. The amendments limit the power in this clause for the Secretary of State to amend the Copyright, Designs and Patents Act 1988 by regulations, so that it can be used only to make consequential amendments. This ensures that the power is focused only where it is needed and appropriate.

The amendments require that the first regulations made under this power—that is, the creation of the first orphan works regulations, the first extended collective licensing regulations and the first exercise of the powers to introduce codes of practice and enforcement provisions for these codes and for the regulation of licensing of orphan works and extended licensing—are subject to the affirmative procedure. That was a long sentence and will need careful reading in Hansard. I think it makes it clear that all those regulations, codes and enforcement provisions are subject to the affirmative procedure, but noble Lords will have check Hansard. The amendments introduce a maximum penalty of £50,000 where the requirements for authorisation under Clause 42 are breached. Finally, there are equivalent amendments for performers’ rights. Amendment 299D introduces the same amendment for performers’ property rights.

The Government have listened to concerns and we have proposed some substantial amendments to address these. The amendments clarify the scope of these provisions and strengthen the safeguards that surround their use while maintaining the function and purpose that was originally envisaged, which is widely supported by our cultural and creative sectors. I beg to move.

I have two questions on Amendment 282AZA in this group. First, each licensing body has to maintain its own register, so will there be a central register accessible by all? Secondly, what period of notice is the licensing body required to give? I am envisaging a small photographer who may have just missed the announcement. How long will it remain on the public record?

I apologise to my noble friend for entering this lengthy debate so late in the day. I do so at the instigation of the Periodical Publishers Association of which I am the vice-president. It is an unpaid post and not a very onerous one.

The PPA wants to draw attention to Amendment 282AZA. While it agrees that the licensing of orphan works is needed, it wants to know what an orphan work is. That brings us to the definition. The PPA thinks that the definition suggested in the amendment is vague and useless in any real sense. I had thought that since this relates to the Copyright Act 1988 there might have been a definition there. I could not find one, and I certainly do not remember one while the Act was being debated. The PPA considers that the definition should be much more precise than that proposed by the Government and that an orphan work should be a published copyright work where it is impossible after a reasonable search to establish the identity of or to locate the author or copyright owner of that work. That is not in the amendment. I do not want to go on about it but I hope that the Government will refer back to the PPA and discuss it.

While I am at it, let me say briefly that the PPA believes that the proposal to introduce extended collective licensing, which is in the same part of the Bill, is contrary to the fundamental principle that owners of literary and artistic works must consent to the exploitation of their work when the owner is known and can be located. I shall not detain the Committee any longer but I hope that my noble friend will reflect on the views of the PPA and reconsider the definition in the Bill.

I thank the Minister for tabling the amendments which go some way to addressing the many concerns about the provisions. Amendment 277 is a probing amendment suggested by the British Library which is concerned that since much of the material it hopes now to be able to use has never been published, it will not be excluded from being designated ineligible under new Section 116A as it is under new Section 116B. I should be grateful if the Minister could give some guidance on that point.

Returning to the government amendments, I am interested to know what a reasonable search would consist of. How much time or money would a body have to spend to fulfil the requirements? Stakeholders have indicated that they spend a little less than half a day on seeking copyright owners. Is that the sort of effort the Government are thinking of? I should also welcome a clarification of proposed new Section 116BA(2)(b) to be inserted in the Copyright, Designs and Patents Act 1988 under Amendment 282AZA. What evidence will be required to meet this threshold?

As I understand it, there would be a multitude of registers, each one to be maintained by a single licensing body. Is that correct? Does the Minister have any intention of connecting the registers so that there is a one-stop shop for copyright owners to check whether their works have been mistakenly included? It would also be useful for would-be licensees to access the full range of the material that will I hope be opened up by these provisions. Finally, moving more of the regulations into the affirmative procedure is to be welcomed.

My Lords, I welcome some of these amendments from these Benches. Obviously, a number of amendments already have formed themselves in the minds of Committee Members, as we have discussed, particularly in terms of the kinds of search required. I accept that the Government have addressed themselves to some of those issues, but I do not want to lull the Minister into a false sense of security so that he thinks that we have accepted these amendments and that they are completely apposite. A great deal more work needs to be done.

I support some of what my noble friend said. These days, it is not necessary to create a single register, but format requirements need to be imposed on the registers so that a single search engine can search them all with consistency.

My Lords, I shall endeavour to respond to the points made, first, in relation to Amendment 277 moved by the noble Lord, Lord Howard. The amendment seeks to include unpublished works in the extended licensing scheme. Including unpublished works would mean, for example, that anyone who has ever written anything could have their work included in an extended licensing scheme unless they opted out. This could put a burden of opting out on a large proportion of the population. It would also create a risk of the system collapsing under the weight of the opt-out notifications. For those reasons, unpublished works were excluded.

I was interested in the point made by the noble Lord, Lord Lucas, on the central register and we will write to him on that. We will also write in relation to the period of notice and the licensing authority. My noble friend Lord Howie did not like our definition of an orphan work. He did not say that it was indeterminate, but he thought that it was too vague. We will look at a more precise definition.

I may have here some inspiration from the Box, which might enable me to answer a few more questions. On the central registering body and the one-stop shop, the intention is that each authorised body will keep a register of orphan works which can be accessed by copyright owners. The point made by the noble Lord, Lord Lucas, now has even more relevance. Perhaps we will come back to him on that.

I have tried to answer all the points that have been raised. Perish the thought that we should ever be lulled either into a false sense of security or complacency. There is still some way to go. The sheer delights of Report stage loom ahead, which is why we welcome the comments that have been made. I hope that the noble Lord, Lord Howard, will feel able not to move Amendment 277.

Amendment 265A agreed.

Amendments 266 to 268 not moved.

Amendment 268A

Moved by

268A: Clause 42, page 46, leave out lines 26 to 30

Amendment 268A agreed.

Amendments 269 to 273 not moved.

Amendment 274

Moved by

274: Clause 42, page 46, line 34, at end insert “licensing”

My Lords, it is so long since we started this Bill that I am not sure whether these two amendments are of any significance. I have no doubt that if they threaten the architecture of the Bill, the Minister will tell me. They are designed to clarify what kind of body we are talking about and to make sure that we are clear that it is a licensing body. Their intention is no more sinister than that. I beg to move.

I declared an interest at the start of Committee but I should declare again that I am a literary executor. I have a great many concerns about the proposed new Section 116B and will be listening with interest to the Minister’s responses to the next few groups. Proposed new Section 116A targets a known problem that everyone wishes to see resolved. I am far less convinced about the need for such broad powers as are set out in proposed new Section 116B. Is there any evidence that copyright owners are proving incapable of handling their own rights? Are these provisions designed to help copyright owners assert their rights or are they to make it easier for would-be licensees to override the restrictions and limitations copyright owners wish to put on their work? It would be quite wrong and contrary to the spirit of the first part of the Bill if a natural desire on the part of the public—even for unimpeachable reasons such as education—to use material that is owned by someone should ever be allowed to override a copyright holder’s right to withhold the material. I am sure these provisions do not intend to do that but without stringent safeguards on the licensing bodies, on the types of material that fall under these schemes, and on the requirement to engage with copyright owners, it is quite possible that such abuses will occur. I believe, therefore, that a clear code of practice that covers these points is essential and I hope the Minister will agree.

My Lords, proposed new Section 116B(1) comprises one sentence which begins by referring to a “licensing body”. The sentence subsequently refers to the licensing body as the “body”. It is the same. The addition of the word “licensing” is therefore unnecessary and I ask the noble Lord, Lord Clement-Jones, to consider withdrawing Amendments 274 and 275.

Amendment 276 would require regulations made under powers to be introduced by Clause 42 to provide that licensing bodies must adopt a code of practice before they can be authorised to operate an extended licensing scheme. I can assure the noble Lord, Lord Howard, that there is no way we wish to see licensees overriding the rights of copyright owners.

Licence bodies must adopt a code of practice before they can be authorised to operate an extended licensing scheme. This can already be achieved through use of the powers currently contained in the Bill. Schedule A1 enables the Secretary of State to make regulations requiring licensing bodies authorised to set up extended licensing schemes to adopt codes of practice complying with requirements in the regulations. Is there any evidence that copyright owners find it difficult to exercise their rights? The exclusive right of the copyright owner to control their work is kept intact through the opt-out mechanism. In being able to opt out at any time, the copyright owner retains total control of their work. I hope that that is a further assurance. In the light of these assurances, I hope that the noble Lord will feel capable of withdrawing his amendment.

I cannot see, although I am sure that it is there somewhere, where the copyright owner has the right to opt out at any time.

That is what I am reliably informed—that that will be the case. I am looking to my Box for inspiration, and they are nodding. We will draw the noble Lord’s attention to where that is in the Bill explicitly in writing.

My Lords, I thank the Minister for his response. I am sure that we all look forward to hearing a promise of a torrent of letters from the department, as the night progresses. I beg leave to withdraw the amendment.

Amendment 274 withdrawn.

Amendments 275 to 277 not moved.

Amendment 277A

Moved by

277A: Clause 42, page 46, line 37, after “work” insert “, unless it is a broadcast or a work included in a broadcast”

Amendment 277A agreed.

Amendment 278

Moved by

278: Clause 42, page 46, leave out lines 38 and 39

This is a brief probing question to elicit more details from the Minister as to what he would consider an appropriate system for establishing whether a copyright owner has withdrawn consent for being included in one of these schemes. Will there be an equivalent of the orphan works register for collectively licensed works? If not, how is a copyright owner to know if someone is licensing off his material? Secondly, what sort of notification process will it be necessary for a copyright owner to negotiate to have his material removed from a scheme? Will he be able to withdraw the rights from some of his works, but not others? Will he be able to put some limited restrictions on them, such as for them not to be licensed to certain formats or certain people? I shall be quite happy for most of this to be answered in writing. I beg to move.

My Lords, the provisions on extended licensing preclude the inclusion of works for which the copyright owner has given notice that they want them to be excluded from an extended licensing scheme. The importance of the opt-out is that copyright owners retain control of their work and cannot be compelled to have their works licensed under a scheme. There is no overriding policy reason to interfere with the copyright owner’s control. In relation to the point about partial withdrawal for a body of work, I am seeking confirmation from the Box, but I am not getting anything. Communication is a wonderful thing—when it works. I am pretty sure that we can confirm that in writing, together with another point which we will need to deal with. I think I have given plenty of assurance on the question of control, the opt-out and the extensive nature of that, but where I have not we will explain further in writing. In the light of the explanation, I hope the noble Lord will feel able to withdraw his amendment.

My Lords, I thank the Minister. Another important question is how you opt out, but in anticipation of his further response, I beg leave to withdraw the amendment.

Amendment 278 withdrawn.

Amendment 279

Moved by

279: Clause 42, page 46, line 38, after “rights” insert “specifically”

My Lords, this is one of the most interesting parts of the Bill, because there is some level of bafflement about the precise circumstances in which extended licensing is appropriate. As I mentioned earlier, the clearest example I have been given is clearance of rights in a backlog of programmes owned by the BBC. Some say that current arrangements pretty much allow for that, because if collecting societies have a particular set of rights cleared, they will find it relatively straightforward to clear an additional set of rights. It would be useful to hear from the Minister the kinds of bodies he envisages would want to take advantage of extended collective licensing.

In that context the question arises of whether it is only orphan works which are the issue. If this is designed to go further than orphan works, what kind of works are we talking about? Amendment 280 is designed specifically to make sure that works other than orphan works are excluded from the scheme. We are dimly looking through to the Government’s intentions behind this, but if clarity was needed for proposed new Section 116A, even greater clarity is required for proposed new Section 116B. I beg to move.

My Lords, in order to shorten my speech today, I had better send a letter to the Minister on Amendment 282. I shall be interested in the replies to the amendment tabled by the noble Lord, Lord Clement-Jones.

The issue harks back to Clauses 4 to 17, and my efforts to persuade principally the music and film industries to come up to date a bit. At present, there is an attempt, organised by the Association of Independent Music, to promote a scheme involving music rights holders and an ISP to offer a viable alternative to piracy—something that will be easy, appeal more and will not be too expensive. If the noble Lord is not aware of this, his colleagues will be. They will also be aware that some of the major rights holders are proving extremely slow to co-operate in this and similar initiatives. I hope that much of the Government’s mission in pushing this Bill forward is to encourage the industry to adapt, and to make it clear to the industry that, in contrast to bullish statements being made in the United States, this Bill will not solve the piracy problem for all time. It will not solve the problem: it is a breathing space and it has to be used to adapt.

My Lords, I share a number of these concerns and, in particular, I support Amendment 280. As we have said before in these debates, it seems almost absurd to have one part of the Bill devoted to protecting copyrights and another devoted to taking them away. I simply do not understand why safeguards inserted to protect copyright owners from having their works mistakenly classified as orphan are not extended to this proposed new section.

My Lords, the extended licensing proposals allow the copyright owner to opt out of an extended licensing scheme at any time. If the copyright owner wants all their works to be removed from a licensing scheme, there would be no need for them to specify them, but if they wanted just one or a few rights to be removed, they would naturally need to specify them in order for the collecting society to identify those rights and remove them from the scheme. That actually answers a question raised by the noble Lord, Lord De Mauley in the previous debate. I suggest that there is no need to add “specifically” and I hope that this will persuade noble Lords not to press their amendments.

I welcome what I believe is the intention of Amendment 280—to protect the interests of copyright owners who may be affected by the establishment of an extended licensing scheme. I assure noble Lords that the powers in the Bill will allow for regulations requiring the Secretary of State to consult with those likely to be affected before authorising such a scheme. We intend to consult as widely as possible, allowing us to take account of the views of different interest groups.

Regarding Amendment 281, there are powers in new Section 116A for the Secretary of State to determine in regulations how long royalties collected for the use of orphan works will be kept and for their disposal if the owner is not identified at the end of that period. Those powers may be extended to cover orphan works licensed under an extended licensing scheme, so it is unclear why this provision would need to apply to royalties from works which are not orphan but are licensed under extended licensing schemes. An authorised licensing body will be able to distribute royalties to owners of works which are not orphan, so it is unnecessary to make provision for the distribution of those sums if they are unclaimed.

The noble Lord, Lord Clement-Jones, asked whether we were intending this to go beyond orphan works; the answer is yes. Extended licensing is not a new business model that will be imposed on different sectors. Any licensing body wishing to extend its repertoire will need to make a business decision to do so, presumably with the consent of the rights holders on behalf of whom it acts. It will then need to make a specific application for authorisation from the Secretary of State, who may grant that authorisation if certain specified criteria which have been consulted on are met. The Bill does not give the Government the power to impose extended licensing schemes on any sector that they wish.

Amendment 282 requires the Secretary of State to put forward proposals on the use of the powers introduced by Clause 42 to make regulations providing for extended licensing for,

“music, film and broadcast works in electronic form … within one year”,

of the Bill becoming an Act. I have made it clear that the Government are committed to consulting before introducing regulations under these powers.

The noble Lord, Lord Lucas, noted the fact for the Committee that music rights holders and an ISP will be coming up with an alternative to piracy; we await that with interest and have said that we welcome those developments. The noble Lord is right to describe the nature of the Bill as a breathing space; in the world of IT, we know that there is no such thing as a stasis, so his assessment is probably right—and that is probably why Clause 17 somehow came into being, but I hesitate to mention that again. I hope that, in the light of those assurances and explanations, the noble Lord will feel able to withdraw the amendment.

My Lords, I thank the Minister for that reply, which illustrated some interesting and useful information and will be required reading in Hansard. The fuzziness still remains. The Minister—I think I quote him correctly—referred to certain specified criteria which will be the subject of consultation. I feel as though I am dealing with a sponge. This is the very opposite of certainty. Maybe, it is because we do not have the benefit of the consultation document in front of us. Maybe, it is because those criteria were not included in the Minister’s speech. The more hard-edged the Minister can be about the nature of these particular beasts, which many rights holders believe threaten their economic viability, the better. I live in hope. In the mean time, I beg leave to withdraw the amendment.

Amendment 279 withdrawn.

Amendments 280 to 282 not moved.

Amendment 282AZA

Moved by

282AZA: Clause 42, page 46, line 42, at end insert—

“116BA Orphan works: supplementary

(1) A work is an orphan work, for the purposes of an authorisation given or to be given to a person (an “authorised person”) under section 116A or 116B, if any interest in copyright in the work is entered in a register maintained for the purposes of this section by that person (an “orphan works register”).

(2) An authorisation in respect of an orphan work does not affect the need for any consent—

(a) from the owner of an interest not entered in the authorised person’s orphan works register (except in the case of an authorisation under section 116B that extends to other interests), or(b) from the owner of an interest that is entered in that register, if the authorisation does not apply to that interest.(3) An authorised person must not enter an interest in an orphan works register unless the authorised person—

(a) has complied with the requirements of subsection (8) in respect of that interest and has not found the owner of the interest, or(b) has reasonable grounds for believing that another person has complied with those requirements in respect of that interest and that the owner of that interest has not been found.(4) An entry in an orphan works register relating to an interest in copyright must include the record kept in accordance with subsection (8)(c).

(5) If an authorised person finds the owner of an interest entered in that authorised person’s orphan works register, the authorised person must remove the entry.

(6) If in relation to an interest entered in an authorised person’s orphan works register, the authorised person—

(a) is aware that the requirements of subsection (8) were not complied with, or(b) is aware of information that makes it no longer reasonable to rely on what was done in compliance with those requirements,the authorised person must comply as soon as possible with the requirements of subsection (8) or remove the entry. (7) A failure by an authorised person to comply with any of subsections (3) to (6) in relation to an interest to which an authorisation applies—

(a) does not affect the authorisation in relation to that interest, except so far as regulations may provide, but(b) is actionable as a breach of statutory duty owed to the owner of that interest.(8) The requirements of this subsection in respect of any interest in copyright are—

(a) to carry out a reasonable search to find or, if necessary, to identify and find, the owner of the interest,(b) after the search, to publish notice of the proposal to enter the interest in an orphan works register, in a way designed to bring the proposal to the attention of the owner of that interest, and(c) to keep a sufficient record of the steps taken under paragraphs (a) and (b) and of the results of those steps.(9) For the purposes of subsection (8)(a) the person carrying out the search must in particular—

(a) make such use as is reasonable of sources of information, including sources within subsection (11), relating to the work’s apparent country of origin, and(b) have regard to any presumptions under section 104 or 105 that would apply in relation to the work in any proceedings.(10) The sources referred to in subsection (9)(a) are—

(a) licensing bodies;(b) associations of publishers or authors;(c) systems for identifying works of the type concerned;(d) published library catalogues and indexes;(e) public databases, including public records that may indicate successors in title.(11) For the purposes of subsection (9)(a) a work’s apparent country of origin is the country which the person carrying out the search reasonably believes is most likely to be—

(a) the country of the work’s first publication, or(b) if the work has not been published, the country with which its making is most closely connected.(12) Any guidance issued by the Secretary of State must be taken into account in deciding whether the requirements of subsection (8) have been complied with.

(13) The Secretary of State may by regulations amend any of the preceding provisions of this section.”

Amendment 282AZA agreed.

Amendments 282ZA to 282ZD not moved.

Amendment 282ZE

Moved by

282ZE: Clause 42, page 47, line 9, leave out “and 116B” and insert “to 116BA”

Amendment 282ZE agreed.

Amendment 282A not moved.

Amendment 283

Moved by

283: Clause 42, page 47, leave out line 13

Amendment 283 agreed.

Amendment 283ZA

Moved by

283ZA: Clause 42, page 47, line 14, at end insert—

“( ) The power referred to in subsection (2)(a) to make consequential provision includes power to amend this Part.”

Amendment 283ZA agreed.

Amendment 283A not moved.

Amendment 283B

Moved by

283B: Clause 42, page 47, line 15, leave out “and 116B” and insert “to 116BA”

Amendment 283B agreed.

Amendment 283C

Moved by

283C: Clause 42, page 47, line 20, leave out from beginning to “may” in line 21 and insert—

“(5) Subsection (6) applies to a statutory instrument containing any of the following—

(a) the first regulations made under section 116A;(b) the first regulations made under section 116B;(c) the first regulations made under paragraph 1 of Schedule A1;(d) the first regulations made under paragraph 3 of Schedule A1;(e) regulations under sections 116A to 116BA or Schedule A1 amending section 116BA or another provision of this Part.(6) The statutory instrument”

Amendment 283C agreed.

Amendment 284

Moved by

284: Clause 42, page 47, line 23, at end insert—

“116E Registry of copyright

(1) OFCOM shall maintain on the web a registry of other websites where copyright material may be located.

(2) OFCOM shall, at the request of the website owner, add a website to the registry if that website complies with OFCOM’s rules for such additions as are then in force.

(3) The rules under subsection (2) shall require—

(a) that each copyright work on the site may be readily identified from information openly provided on that site,(b) that accurate and complete information on how to licence each copyright work is provided on that site,(c) that each copyright work on that site is available for licence, and that there are arrangements in place for binding arbitration of disputes relating to the extent or the cost of a licence,(d) that the architecture of the site allows the search facilities that OFCOM provides under subsection (4) full access.(4) OFCOM shall maintain, and may charge for the use of, facilities to enable a user to establish whether a copyright work of a given description exists in any of the websites listed on the registry maintained under this section, and to provide a certificate of what such works exist or that no such work is to be found.

(5) No claim may be made under section 116A that a work is an orphan work if a certificate under subsection (4) has not beeen obtained.””

My Lords, this is the reflection of the earlier amendment of my noble friend Lord Howard. Just as I agree with him that those running registries should make it easy for people to establish what is in them, those holding and wishing to assert copyrights should make it easy for people to find them. I suggest that there should be a system run by Ofcom but not costing it anything, which allows those who wish to ascertain who owns the copyright of a particular piece of material to perform a simple search and find the answer. In the course of time this should mean that not only is it easy for a little photographer or a little creator of any kind to register the copyright in their work so that it cannot be overlooked by even the most short-sighted of exploiters of that copyright, but it becomes easy and simple for those who wish to establish who owns the copyright to find the answer. This is really only possible with modern technology where you can have image search engines and fast-tech search engines and you can characterise music. It would not be a Google search but a search provided by a specific engine provided by Ofcom, licensed by Ofcom and paid for by people who wish to search for copyright. It is perfectly technically feasible and would save people a lot of trouble. I beg to move.

I recognise where the noble Lord is coming from, but we feel there are already many databases of copyright information available online, such as the excellent ARROW project, with which I have no doubt the noble Lord, Lord Lucas, is familiar. Where there is a publicly accessible database of this sort, it would be sensible to search it before a work can reasonably be considered “orphaned”.

The government amendments that we have moved recognise that such databases are an invaluable resource for those seeking to identify the owners of works, and require that they be searched before any work can be declared orphan. The government amendments also introduce a requirement for those administering an orphan works scheme to maintain a register, but I think that is slightly different from what is envisaged by the noble Lord, Lord Lucas, with this amendment.

The maintenance of registers of orphan works with details of the diligent search that has been undertaken will ensure that the process is properly adhered to and documented. This is not the same as requiring Ofcom to create and maintain what would amount to a shop window of online works available to license. While, as I say, we understand the intentions, we do not believe that they are appropriate for the reasons I have given. In the light of those, I trust that the noble Lord, Lord Lucas, will feel able to withdraw the amendment.

Amendment 284 withdrawn.

Amendment 284ZA

Moved by

284ZA: Clause 42, page 47, line 29, leave out “116A(6)” and insert “116BA”

Amendment 284ZA agreed.

Amendment 284A not moved.

Amendment 284B

Moved by

284B: Clause 42, page 47, line 31, leave out “1A(6)” and insert “1BA”

Amendment 284B agreed.

Debate on whether Clause 42, as amended, should stand part of the Bill.

My Lords, I do not wish to prolong the agony but I have given notice that I wish to oppose Clause 42 standing part. It is possible simply to sketch out some of the issues that have been raised in the debate. I know that the Minister has taken note, and I very much hope that it is not necessary to go into any great detail about the failings of Clause 42, despite many of the welcome government amendments. The problem is that the distinction is not made between cultural and commercial uses.

There is a big issue as far as the profession of photography is concerned, and I have had quite a lot of communication with the Royal Photographic Society on this issue. It clearly represents the interests of its members. It believes that because it is so easy to strip out information about copyright attribution from photographs that are put on the web, for instance, many hundreds of orphan works are being created every week. It feels that this problem is of particular significance to its profession. It believes that these provisions would not act in its best interests and that they will be a way in which commercial interests will be able to pay less than the market price for the use of such photographs.

One of the flaws in all this is the fact that, alongside the provisions about orphan rights, no provision is made for moral rights or rights of attribution to be added. The noble Viscount, Lord Bridgeman, has an amendment about moral rights. One of the underlying issues is that very little distinction is made here between modern and historic collections. Until the recent government amendments, there was no proper definition of “orphan work”. Even now, as we have said, there is too little emphasis on the need for proper, diligent investigation of ownership of copyright before orphan work provisions can take effect. In the last group of amendments, we described how there is insufficient explanation of exactly how extended licensing will operate, which bodies are intended to operate it, what works it is meant to apply to, and so on.

All of us have been at pains to point out that generally the cultural sector has made a good case for new orphan works provision. Indeed, the Gowers report did so. I mentioned before that the British Library, the Natural History Museum, the National Museum Directors’ Conference and the Association of Independent Museums have been eloquent in their representations. We want to see them being able to use their archival material for educational and cultural purposes. They have quoted many convincing examples of where these provisions are needed. The big question is how and whether the commercial sector should take advantage of the provisions. The key issue is that on the face of it, the clause is far too wide. There are fears among many creators—writers and photographers in particular—that this will be a means of using their works at a knock-down price on the basis that they have been temporarily classified as an orphan work. There are aspects of the clause that we can fully support, but the Government need to pare it down to its essentials before we can fully support it.

My Lords, the noble Lord, Lord Clement-Jones, an amendment or two ago, referred to the flabby brief that we have because so much of the regulation will be left outside the Bill for secondary legislation. It is the usual bleat from the Opposition that this happens. We accept that time has been very short on this one, and framing of the regulations has not been possible to date. I make a plea that if the Government were able on Report to bring some of the substance of the regulations—I do not expect that it will be all of them—on to the face of the Bill, it will be easier to have a meaningful debate on Report.

My Lords, this clause helps modernise copyright licensing. First, orphan works, as we all now know, cannot at present be used without the specific permission of the copyright owner. The new provision will enable large numbers of potentially valuable cultural works to be used on a regulated and licensed basis, with money held to reimburse the copyright owner if they later come forward. The clause introduces a definition of “orphan works” and regulations made under these powers will contain the detailed procedures for the use and licensing of works so classified. Orphan works are works protected by copyright but for which the copyright owner cannot be identified or traced even after a diligent search. That is a succinct definition.

We said we would reflect on the definition in light of the previous contribution.

The second provision is to allow for extended licensing schemes to be authorised by the Secretary of State. Currently, rights clearance can be complex and time consuming. We aim to help simplify and update the process by allowing an authorised licensing body, under appropriate circumstances, to grant copyright licences on behalf of copyright owners from whom it does not have specific authority to act. As with orphan works, those authorised to operate extended licensing schemes will be subject to safeguards to achieve a balance between the interests of creators, users and stakeholders.

Thirdly, where a licensing body’s own system of self-regulation is failing, the Secretary of State will have the power to require the licensing body in question to adopt a code of practice that meets requirements in the regulations. Our intention here is that licensing bodies should be subject to these requirements if they are authorised to license orphan works or to carry out extended licensing. All other licensing bodies should put in place systems of self-regulation. Fourthly, equivalent powers are introduced for performers’ property rights, together with a definition of “orphan rights”.

On consultation before secondary legislation is drafted and before the first schemes are set up, we recognise that different sectors have different needs. That is why we have tried to draft this legislation to give flexibility in the way orphan work schemes are set up and run. If we find that certain types of work, such as contemporary photography, cannot be included in this framework without causing harm to rights holders then we will have the flexibility to exclude them from any schemes. However, this is not something we can say today and it will be consulted on widely before regulations are drafted.

On moral rights, we recognise that some creators have concerns about the current moral rights system. We also know that many users of copyright material will be equally concerned about any change to that system. Intellectual Property Office officials have carried out an informal review of this issue and will continue to work to identify any evidence for change. It would not be right to make any changes to the moral rights system until we have evidence from all sides of the debate.

This clause will ensure that we are able to access our cultural heritage and utilise modern licensing schemes, while still, as I said, ensuring that copyright owners and owners of performers’ rights control the use of their work and are paid for that use if they wish. Nothing in these provisions is intended to undermine that principle. Indeed, the inclusion of an opt-out for rights holders in both cases will ensure that they retain control of their rights. The Government intend to consult extensively on the detail of regulations before they are made by the Secretary of State under these powers.

I will respond briefly. I thank the Minister for his reply. Despite the fact that we have had a long debate over the past hour and a half on Clause 42, there were some new elements to his reply that I found welcome. I refer in particular to the response about the possible exclusion of commercial photographers if the consultation goes a certain way. There may be a quid pro quo here. The Minister said that it would not be right to introduce moral rights without proper consultation. The quid pro quo may be that commercial photographers are excluded until such time as moral rights are introduced. The Minister was almost juxtaposing that himself: it is an interesting concept. His reply raised some useful points and I look forward to him coming back at Report with a blinding new set of amendments. I will not press my opposition to the clause standing part.

Clause 42, as amended, agreed.

Amendment 285

Moved by

285: After Clause 42, insert the following new Clause—

“Format shifting

(1) The Copyright, Designs and Patents Act 1988 is amended as follows.

(2) In section 17, at the end insert—

“(7) Where a person acquires the right to use a copyright work in electronic form for his personal use, he also acquires the right to copy that work into other electronic formats for his personal use.

(8) Regulations may specify a sum upon payment of which the Registrar of Public Lending Right or a Licensing Scheme may grant a person the rights in subsection (7) in respect of works acquired by him before the coming into force of this section.””

My Lords, unless the Committee objects, I will telescope proceedings by speaking also to all my remaining amendments. I hear no objections: this is good. The amendments have three things in common. First, I will not move them this evening because they are all probing amendments. Secondly, I cannot imagine that under any circumstances they will end up in the Bill in their current form. Thirdly, if I do not get a reasonable answer from the Minister this evening or by letter before Report, they will certainly re-emerge then, and will probably contain a requirement that Ofcom continues to investigate, or that in some other way progress continues to be made.

Amendment 285 concerns format shifting, which is an old chestnut. It is something that is widely done. It is pretty universally accepted that if you buy a CD, you can put it on your MP3 player; but it is none the less against copyright. If copyright owners tried to pursue this hard, the Government and public would react swiftly against them. None the less, there is a right there that remains unremunerated. Copyright owners have been pressing for this to be dealt with, as it is on the continent, by a levy on the kit used for format shifting.

Another way of dealing with it might be that one could acquire a licence to format shift from the relevant licensing authority in whatever form the Government choose, so that rather than burdening ourselves with creating a new system of getting revenue via hardware, we use the existing system of licensing bodies to allow people to acquire a licence to format shift, much in the same way as people acquire a television licence. Format shifting is an unsettled area of copyright in which we should be making gentle progress.

Amendments 286 and 287 concern the artist’s right to remarket. Only a minority of music and other material is available on the net. Many artists find that substantial parts of their back catalogues are not for sale: they are locked up by people who have acquired the copyright interests and who do not find it worth their while marketing the work, so the artist gets no revenue from it. I think that there is a scheme—the noble Lord will tell me if I am wrong—that covers programmes provided by independent producers to ITV. After a certain period, if the programmes are no longer being actively used by ITV, they become open for remarketing by the companies that made them. If they successfully remarket something, they pay, I think, 50 per cent back to ITV. ITV acquires a revenue stream for which it has to make no effort at all. The original producer—who after all ought to be the concern of this Bill as much as the copyright owner—acquires a revenue stream where before there was no hope of income. Both sides benefit. This arrangement has been reached in this one small corner of the industry, although it could certainly be extended to music without any damage to anyone. The industry ought to be encouraged to make progress on this and, if we come to a proper reform of copyright, ought to be included. I want to hear from the Government what their position is on this and what progress they hope to be making in that direction.

I shall not address Amendment 289. I shall not move it at the appropriate time.

Amendment 290 relates to a practice which has grown up among some of the major rights holders. They look at licensing the material they have control of to a scheme and say, as some internet schemes do, “All you can eat for $15 a month”, or whatever the right wording for that is in relation to music. Rather than requiring a payment from the scheme they are licensing, they say, “You can have access to our music for a proportion of your equity”. They then say to the creators of this content, “No, you’re not entitled to any of this. This is not income, this is something else. It is ours, not yours”. This Bill should be concerned as much with the creators as with the owners of copyright. This injustice is likely to grow in the context of the way in which one can envisage the business of distribution of copyright materials on the net developing, and it ought to be ended because the interests of the creator ought to be preserved even if the rights have been disposed of in return for equity.

Amendment 291 is an attempt to move the industry, and particularly the music industry, on a bit. It probably goes a bit far to discuss this evening.

Amendment 292 returns us to something we have discussed peripherally this evening; namely, the way in which search engines and copyrights interact. That is amplified in Amendment 292BA, which looks at links. To deal with the latter amendment first, some major groups have asserted that to link to their material on the internet is to infringe their copyright. This is an extremely undesirable development and we ought to state clearly that we are against it and will take action against it. I return to my earlier comments on copyright—copyright is a compact between a Government and the creators of copyright content to enable the creation of that content by disadvantaging its citizens. I do not see that copyrighting or allowing the copyrighting of links advantages citizens in any way. There is no creation involved in that act. It merely starts to balkanise and destabilise the web and it should not be allowed.

We should think carefully about what we want search engines to do and what we want the web to look like. It comes down to the question of whether we want to run the web British style or Chinese style. Are we interested in search engines being able to reach anything that people have put out on the web and that is not specifically blocked, or do we want to allow something that is more balkanised and where whole sections of the web are available only through subscription to a certain ISP or site? We ought to take the clear view that the breadth of knowledge on the web should be available to all, and that commercial interests on the web should be confined to relatively small corners of it and not allowed to take over vast swathes of it. In most cases, a search engine taking a small extract of copyright material—what is on a search engine is copyright material—should be regarded as fair usage and a proper part of the way in which the citizen and the copyright holder interact. I beg to move.

My Lords, I do not know whether to respond to the thoughtfulness of the noble Lord, Lord Lucas, in grouping together all his remaining amendments on the Marshalled List at this late stage of the day and speaking to them, or to his threats that the Government are in for very serious trouble on Report if my responses are not good enough. I will respond in a similarly constructive way. I am all too aware that he somewhat syncopated the quality and range of the arguments that he might have put in defence of his amendments, although, by the same token, the Government’s replies will not be as extensive as they might have been, so I undertake here and now to write to him with a fuller response. I am well aware that there will be conspicuous gaps in my response to his arguments and to the issues that he raises, although I hope to be able to cover some of the more significant points of principle so that we clarify the position.

Amendment 285 deals with the format-shifting question, to which the Government have given the most careful consideration both in the recent copyright strategy and in the second-stage consultation on the Gowers recommendations on copyright exceptions. We have concluded that a UK-only solution will not be able to deliver the kind of access and use that private individuals would like while at the same time respecting the needs of rights holders for appropriate remuneration, and that a solution that is suitable for the digital age can be delivered only in an EU-wide context. The noble Lord will appreciate that we have a great deal more work to do in this area, and I hope he will recognise that we cannot accept the amendment.

Amendments 286 and 287 deal with artists’ right to remarket. As stated in the recent copyright strategy, the Government plan to draw together a group to develop model contracts or contract clauses that strike a fair balance between the rights of creators and publishers to form a benchmark for good practice. We are already working with industry representatives to take this forward, and we recognise the importance of this point.

I do not think that the noble Lord spoke to Amendment 289, which is the only amendment for which I have a specific answer that might have been regarded as satisfactory and all encompassing. He did, however, speak to Amendment 291, which would take away the control of the creator. We do not think that there is a compelling policy reason to do so in this case.

Likewise, we are worried about Amendment 292. Interfering with the balance of current rights and exceptions would have far-reaching consequences for those who run web services and for rights holders and consumers. There is also a real danger of unintended consequences when legislating for particular technology-specific issues. We therefore do not think that it would be right to legislate further in this area without having examined fully whether a further exception is necessary, and without having determined the full consequences of these actions.

I recognise that the noble Lord put forward an important argument in this area, and this is certainly one of the responses which I know he will say in a moment or two is somewhat less than satisfactory. I will certainly undertake to write to him with regard to that amendment, and to flesh out our arguments on the other amendments.

Finally, on Amendment 292BA, we are not clear whether all of the activities within the scope of this amendment would infringe copyright in any event. In some cases, it would depend on the circumstances of a particular case. The amendments may legitimise some aspects of unlawful file-sharing and so would of course conflict with one of the aims of the Bill.

The Government want—and the noble Lord did say how important it was for us to have a definition of what we wanted from the web—web users to continue to be able to use the web freely for legitimate uses, but we do not want to condone or to encourage copyright infringement. Those are the principles which underpin our approach to the web. Once again, I know that I am craving the noble Lord’s indulgence with such a sparse response to some intensive arguments, which he mercifully at this late hour kept to a few well-chosen words. We will write to him on all those amendments and I know very well that if he is less than satisfied with the responses on that very mildly-presented point, we may hear more from him. We will certainly bear that in mind in the letters that we write to him. I hope that he will withdraw his amendment.

My Lords, there is certainly potential in the letter that the noble Lord will write to satisfy the questions that I have raised in these amendments. I look forward to reading it. He did not address Amendment 290. Given that it is a somewhat technical amendment, I will be satisfied with a letter on that subject too. I will be particularly interested in the detail on Amendments 286, 287, 290, and 292BA. Those are the ones where the noble Lord has excited my interest most in terms of what can possibly be conveyed through a letter. I look forward very much to receiving it. I beg leave to withdraw my amendment.

My Lords, I regret my omission of Amendment 290. That was a mistake on my part. I am not going to go into it in great detail now, but we do have very considerable sympathy for the intention behind this amendment. However, we are not sure that this is the way to achieve what we think we have in mind as a common aim. If that is an encouragement to the noble Lord, he will find the letter at least reasonably positive in that direction.

Amendment 285 withdrawn.

Amendments 286 to 292 not moved.

Amendment 292A

Moved by

292A: After Clause 42, insert the following new Clause—


(1) The Copyright, Designs and Patents Act 1988 is amended as follows.

(2) In section 296ZG (electronic rights management information)—

(a) after subsection (3) insert—“(3A) This section also applies where a person (F), knowingly and without authority, distributes, imports for distribution or communicates to the public or makes available to the public any device, product or component, or provides services which are designed or promoted to remove or alter electronic rights management information.”(b) after subsection (4) insert—“(4A) A person D or E or F shall be liable on summary conviction to a fine not exceeding level 5 on the standard scale.””