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Report says archaic intellectual property laws obstruct innovation and economic growth, particularly online Professor Ian Hargreaves has made 10 major recommendations to free-up restrictive intellectual property and copyright laws that “obstruct innovation and economic growth in the UK”. Hargreaves, who has today published the conclusions of a five-month review in a 123-page report, found that businesses aiming to take advantage of opportunities in areas such as the internet are being held back by often archaic laws. “Could it be true that laws designed more than three centuries ago, with the express purpose of creating economic incentives for innovation by protecting creators’ rights, are today obstructing innovation and economic growth?” said Hargreaves. “The short answer is: yes.” Hargreaves said that the single biggest failing in the current system relates to copyright – “once the exclusive concern of authors and their publishers” – for which the current laws are “falling behind what are needed”. “The UK cannot afford to let a legal framework designed around artists impede vigorous participation in these emerging business sectors,” he said. “This does not mean, however, that we must put our hugely important creative industries at risk”. The recommendations include the formation of a Digital Copyright Exchange by the end of 2012 to act as a “one-stop shop” to make it easier to get clearance for the use of copyrighted content. “This will make it easier for rights owners, small and large, to sell licences for their work and for others to buy them,” argues the report. “It will make market transactions faster, more automated and cheaper.” The new body, to be run by rights holders, would be part of the solution to the long-running issue of IP rights relating to “orphan works” – where the original musicians, writers, heirs or other copyright owners cannot be traced. The report refers to this content as a “vast treasure trove” of work that is “effectively unavailable” for use. Other recommendations aim to clear up anachronistic regulations, including getting rid of the law that makes it illegal to download a CD on to an MP3 player, known as “format shifting”. Intellectual property laws around parody, which are considerably more stringent than in countries such as the US, should be relaxed to allow comedians, broadcasters and other content creators more scope – ensuring that spoofs such as the YouTube hit Newport State of Mind are no longer removed. The Hargreaves report also pointed out that the UK “does not allow its great libraries to archive all digital copyright material, with the result that much of it is rotting away”. It argued that “taking advantage of these EU-sanctioned exceptions [to free up regulation] will bring important cultural as well as economic benefits to the UK”. “The UK should give a lead at EU level to develop a further copyright exception designed to build into the EU framework adaptability to new technologies,” the report said. “This would be designed to allow uses enabled by technology of works in ways which do not directly trade on the underlying creative and expressive purpose of the work.” While the report admitted that the creative industries need to be protected from illegal activities – such as the downloading of pirated music, film and TV material – it also said that “reliable data about scale and trends is surprisingly scarce”. The report went further, criticising industry estimates on illegal downloads in the UK and arguing that a “detailed survey of UK and international data finds that very little of it is supported by transparent research criteria”. It noted that one submission put the level of illegal downloads at 13% of the total, while another suggested it was 65%. “Meanwhile, sales and profitability levels in most creative business sectors appear to be holding up reasonably,” the report said. “We conclude that many creative businesses are experiencing turbulence from digital copyright infringement, but that at the level of the whole economy, measurable impacts are not as stark as is sometimes suggested.” The Hargreaves report rejected calls for the adoption of US-style “fair use” rules on copyrighted material. Companies such as Google and YouTube exploited US fair use law to build their digital aggregation websites without fear of prosecution for using copyrighted content. “We concluded that importing fair use wholesale was unlikely to be legally feasible in Europe,” said the report. “The approach advocated here stops short of advocating the big once and for all fix of the UK promoting a fair use copyright exception to the EU, as recommended by Google and under examination by the Irish government.” The report estimated, albeit with a “high degree of uncertainty in such projections”, that if the government adopted its recommendations this would add between 0.3% to 0.6% to annual GDP growth. Intellectual property Digital media Media law Piracy Mark Sweney guardian.co.uk