Patents (Amendment) (EU Exit) Regulations 2018

Considered in Grand Committee

Moved by

That the Grand Committee do consider the Patents (Amendment) (EU Exit) Regulations 2018.

My Lords, I beg to move that the Committee considers the draft Patents (Amendment) (EU Exit) Regulations 2018, which were laid before the House on 28 November.

Intellectual property plays a vital role in the UK’s knowledge economy, and this will continue to be the case after our departure from the European Union. Ensuring strong and balanced IP protection and enforcement is central to the Government’s aim of encouraging businesses to innovate and develop new ideas and technologies, which forms part of the industrial strategy. Our IP system is consistently rated one of the best in the world.

I am very grateful to the Minister for giving way. Can he tell us—the same issue came up with the previous regulation—what consultation there has been on the regulation?

I will answer that in due course. The noble Lord will have an opportunity to speak after my speech, and we might make better progress if I take it in that manner.

The regulations are part of the work being delivered by the Intellectual Property Office to ensure that the IP system for the UK continues to function effectively in the event of no deal being agreed when we leave the EU in March. This is essential to ensure a smooth transition for business and provide maximum certainty and clarity.

The draft instrument before the Committee today uses the powers provided by the European Union (Withdrawal) Act 2018 to address deficiencies in UK patent law which would arise on exit. The majority of UK patent law is domestic in origin or derived from various international agreements, so will not be affected by leaving the EU. Only a few specific areas of patent law are governed by EU legislation, and it is those areas which the draft instrument is intended to address.

I shall focus in particular on supplementary protection certificates, which are a special type of IP rights connected with patents. Noble Lords may recall that SPCs were created in the 1990s by way of EU legislation to deal with a growing issue affecting pharmaceutical and agrochemical products. Before such products can be made available on the market, the regulatory body must be satisfied that they are safe for use in order to authorise them for sale. As this process is extensive and often lengthy, it can stop the innovator enjoying the full period of exclusivity which a patent on such products normally provides. The aim of the SPC system is to limit the effect of that by providing up to five and a half years of additional protection to an authorised product after the expiry of the patents. This arrangement gives the maker of the product more time to recoup the costs involved in research and development, which is especially important in relation to pharmaceuticals.

Unlike other EU IP rights, SPCs granted under the EU legislation take effect at the national level. This means that it will not be necessary to convert or replace existing rights at exit as UK SPCs will continue to be in force. However, it is still important to ensure that the framework remains functionally the same so that the scope of the right is unchanged and users of the system can have confidence in how it operates. The draft instrument therefore makes only technical changes to the retained EU regulations so that the SPC system can continue to operate effectively. For example, the EU regulations currently state that only authorisations which have been granted in accordance with certain EU directives can be used as the basis for an SPC application. After we leave the EU, UK authorisations would not count under this requirement. The instrument therefore makes changes so that the UK authorisations are covered. This will include any authorisations granted centrally by the European Medicines Agency which are converted into national authorisations at exit.

Similarly, the term of an SPC is determined based on the time between applying for patent and the grant of the first marketing authorisation in the European Economic Area. Again, amendments make sure that a UK authorisation can still form part of that calculation so that the term of an SPC is based on a calculation which everyone is accustomed to. Some of the amendments in this area are contingent on changes that will be made to the regulatory regime for medicines in the event of no deal, in particular to the paediatric extension which rewards carrying out additional testing to see if the product can be used to treat children. The transitional provision will ensure that the pre-exit conditions on when the extension can be granted will continue to apply to extensions already approved and applications in progress.

In addition to SPCs, the instrument will make some technical changes in other areas of patent law which are also governed by EU legislation. Where a patent and a plant variety might overlap in the protection they provide, the EU directive on biotechnological inventions allows the holders to seek a compulsory licence if they are unable to agree terms between themselves. The instrument will ensure that the UK transposition of the directive continues to provide that ability to the holders of UK rights. The instrument will also amend EU regulation 816/2006 to retain the ability to obtain a compulsory licence for manufacturing a patented medicine in the UK for export to a country with a public health need. The regulation relates to the flexibilities provided by the WTO TRIPS agreement which the Government continue to support.

Finally, there are miscellaneous adjustments to the Patents Act 1977, the Patent Rules 2007 and the Copyright, Designs and Patents Act 1988 to reflect the fact that the UK will no longer be a member state or a member of the European Economic Area. In conclusion, these regulations form a small but vital part of ensuring that the intellectual property system continues to function if a no-deal outcome arises. I commend them to the Committee.

Before the noble Lord sits down, he said that he was going to cover the issue of consultation later in his remarks and he urged me not to intervene. He has not covered the issue of consultation at all. Would he care to do so now?

My Lords, I did not say that and the noble Lord should not put words into my mouth. I said that when I come to respond at the end, I would deal with the point. No doubt the noble Lord would like to intervene to make the point and I have now listened to it. If the noble Lord would like to stay until the end of the debate, I will respond to it them.

My Lords, I do not think that that is a satisfactory response at all. Our consideration of this regulation, which we are just about to engage in, crucially depends on the Minister telling us what consultation has taken place. It is not good enough for him to say that he will speak at the end of the debate when we raise the issue. I have raised the issue because I wish to respond, as will other Members of the Grand Committee, to what he has to say about the consultation that has taken place.

The noble Lord intervened more than once during the previous debate. I had a number of responses to give to him but sadly he did not think it necessary to stay until the end.

My Lords—

I am not giving way.

I was in the Chamber.