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Hargreaves 'Google Review' backs digi-rights swap shop

No fair use for UK: Trademarks, patents largely ignored

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The "Google Review" – Ian Hargreaves' Independent Review of IP and Growth – has been published. The report's language is more Dave Spart than Geoff Taylor; it reflects legal academia's view that IP is an oppressive hindrance on our way to a cybernetic utopia, rather than the creator and business' view that IP is a temporary monopoly necessary for investment to support inventions.

Hargreaves says there's been too much industry lobbying – ironic for a review that was set up as a result of industry lobbying, and which earned itself the Google moniker almost overnight.

But the language may be window-dressing. The raison d'etre for the review, and Google's most keenly sought reform, was "fair use", and this hasn't been touched.

"The Review into Copyright and a few other bits" might have been more appropriate, for the review has some surprising omissions: patents are barely mentioned and trademarks not once. The two big ideas are almost entirely geared to the music and movie sectors. You wouldn't think the UK was a world leader in design, for example, an industry which yields £1bn a year.

Mary Ellen Field of Brand Finance thought the omission of trademarks was bizarre, given their major contribution to intangible assets.

"Cadbury was not acquired by Kraft for its factories, but its brands," she says.

Although the review team recommends the exchange be "voluntary", it also recommends that the government explore penalising rights-holders who refuse to take part, essentially creating two tiers of creators.

The main bit

Hargreaves recommends a voluntary digital copyright exchange should be up and run by the end of 2012. This is described as a "common platform", or interoperable databases, in which participation would be voluntary. It's intended to lower transaction costs, and make the licensing of copyright material easier.

What incentives are there to take part?

It's voluntary, and Hargreaves review team acknowledges that that "Government goodwill and blandishments will not suffice alone to bring the exchange into existence." The positive incentives aren't clear, but the review urges penalties for not got getting involved.

It recommends the provision that "remedies, for example damages, are greater for infringement of rights to works available through the licensing exchange than for other works; [and] making DEA sanctions apply only to infringements involving works available through the exchange".

In other words, if you opt out, you wouldn't get the full protection of UK law; by taking part, you must give up either flexibility of negotiating the terms on which you sell your stuff, or you give up protecting your stuff effectively. Heads you win, tails you lose.

It is going to be hard to enforce, as international copyright treaties exist to protect creative individuals from this kind of coercion by government, as much as pirates. I asked one of the team how long they'd spent mulling the implications of this, and he said not as long as he'd have liked; the Hargreaves team was given six months to report. He added that the team envisages stronger enforcement rights for participants in the digital exchange – but that's not what the report recommends.

The USA has something similar – and similarly in breach of Berne. If you don't register with the copyright office, you don't get statutory damages. But the UK may not be able to get away with it – and businesses will simply vote with their feet, where they aren't faced with such unenviable "voluntary" choices.

(And where they may enjoy the bonus of lower corporation taxation. Hello, Google).

Martin Spence of BECTU said the review was unlikely to appeal to TV and film companies. Since it's a non-starter with the music industry, it's pretty much dead on arrival.

The eternal dilemma is that while everyone wishes rights-holders would do the right thing, and everyone wishes the internet was a lucrative market, it's theirstuff: you can't coerce or confiscate their rights without consequences.

Other recommendations are to strengthen the courts' ability to protect small businesses, particularly over patent and trademark disputes, widening exemptions for satire, and creating a research exemption for databases.

Hargreaves also recommends photographers and visual artists be thrown under a bus: the DEA's abandoned Clause 43 reappears, with the relaxation of the use of orphan works if the user claims they've done a diligent search for the owner.

For software patents, the report is skeptical about the benefits, and highlights confusion in interpretation under the European Patent Convention (EPC).

Welcoming the report – "I'm not endorsing it", he warned – Vince Cable told an IP conference this morning that the UK is now heavily dependent on intangible assets created by IP. Cable said the UK IP framework was "the best in the world – but can be improved."

Cable cited OECD work, suggesting that small investments in stronger protection for patents, trademarks and copyright had increased foreign investment in the economy by factors of between 8x and 20x. It's an impressive set of stats, but one not mentioned by the Hargreaves Review. ®

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