Ministers Pushing EU Directive that will Harm Industry

FOR IMMEDIATE USE: 4 October 2005

The government is using the UK's presidency of the European Union to push an intellectual property enforcement directive (IPRED) which will harm British industry and undermine basic freedoms, according to Internet think-tank the Foundation for Information Policy Research (FIPR).

The directive will force the UK to make patent infringement a crime, and will also criminalise incitement to infringe patents or copyrights. It is being promoted by the big drug companies and the music industry.

If passed, the police will have more powers against copyright infringers than they have against terrorists. At present, the EU cannot freeze assets if a suspected terrorist financier is a European citizen. Yet the Government wants to empower IP lawyers to seize the assets of EU citizens accused of aiding and abetting infringement -- such as the parents of children who might have downloaded music files.

Innovation will also lose out. A technology entrepreneur today has to take risks with patents, as it's impossible to tell what patents might be in the pipeline. If her business succeeds, she can afford to fight legal cases and pay royalties if she loses. But if patent infringement becomes a crime, then the risks involved in starting a technology firm will be much greater. Britain will be at a particular disadvantage to the USA, where patent infringement will remain a civil matter. It will be very tempting for entrepreneurs to just start their businesses in America instead.

The FIPR response to these proposals may be found at http://www.fipr.org/copyright/ipred2.html

This issue is particularly topical because tomorrow (Wednesday) the Right Hon. Tessa Jowell MP, Secretary of State for Culture, Media and Sport, is launching the Creative Economy Conference in London. for details see http://www.creativeeconomyconference.org

Quotes

Said Ross Anderson, Chair of FIPR and Professor of Security Engineering at Cambridge University:

"Whitehall spin-doctors are telling us that the Government will foster the creative industries, but the IPR Enforcement Directive will have exactly the opposite effect. It will interfere with enterprise and choke off competition. It will push up prices for consumers at a time of rising global inflation, and do particular harm to the software and communications industries. It will also harm universities, libraries and the disabled."

Said Terri Dowty, Director of Action on Rights for Children and member of FIPR's Advisory Council:

"We have already seen the kind of pressure that companies are prepared to exert on the parents of children who download music without due thought. We fear that they would not baulk at mounting criminal prosecutions of children.

"It is monstrous that a ten-year old (or an eight-year old in Scotland) could be criminalised by the careless download of files. Children often assume that if something is available it must also be legitimate, and it is unreasonable to expect parents to monitor their every action -- and most will not have the specialist knowledge to understand whether or not a particular download will be a crime."

Said Nicholas Bohm, FIPR's General Counsel:

"Criminalising patent and other IPR infringement could expose a range of business advisers (accountants, lawyers, bankers) to threats of prosecution as accessories if a company involved in a deal they were arranging or implementing was subject to an infringement complaint."

Contact for enquiries

Ross Anderson
Chair of FIPR and Professor of Security Engineering, Cambridge
University
01223 334733
0791 905 8248
chair AT fipr.org

Terri  Dowty
Director, Action on Rights for Children
020 8558  9317
Archrights AT aol.com

Nicholas Bohm
General Counsel, FIPR
01279 871272
07715 419728
nbohm AT ernest.net

Notes for editors

1. The Foundation for Information Policy Research (http://www.fipr.org) is an independent body that studies the interaction between information technology and society. Its goal is to identify technical developments with significant social impact, commission and undertaken research into public policy alternatives, and promote public understanding and dialogue between technologists and policy- makers in the UK and Europe.
2. The Foundation for Information Policy Research (http://www.fipr.org) is an independent body that studies the interaction between information technology and society. Its goal is to identify technical developments with significant social impact, commission and undertaken research into public policy alternatives, and promote public understanding and dialogue between technologists and policy- makers in the UK and Europe.
3. The free software movement is particularly concerned about the new directive, as it could be used to scare people away from using free software: http://www.fsfeurope.org/projects/ipred2/
4. Although some large software companies are supporting the directive in Europe, they are pushing in the opposite direction in the USA, where the Business Software Alliance wants the damages for patent infringement to be much lower. The USA and Europe may end up with very different patent enforcement rules, which put Europe at a disadvantage when it comes to innovation.
5. Criminalising patent and other IPR infringement would greatly extend the range of business activities that might turn out to be criminal. Professional advisers to businesses which might be at risk would need to consider making precautionary reports to the National Criminal Intelligence Service under the Proceeds of Crime Act. NCIS is already overstretched by the volume of reports, and might not welcome a new deluge of trivia.
6. 5. An IP Enforcement Directive was presented to the European Parliament in 2003. It contained measures similar to those now proposed, but the Parliament's Legal Affairs committee removed them following lobbying by FIPR and others. The measures have now returned with the Commission using an unusual procedural mechanism -- a directive attached to a framework decision -- which makes it technically more difficult for the European Parliament to oppose them.