Properly regulated, IP has the potential to contribute significantly to the economy.  Poor regulation of IP, however, can obstruct innovation and hamper economic growth.  Given that UK firms invest more in intangible assets and IP than in physical ones, it is crucial that the framework for regulating IP fosters a healthy and competitive creative market.

On 3 August, Business Secretary Vince Cable unveiled the UK Government’s response to the review of the UK IP framework delivered in May of this year by Professor Hargreaves.

The Hargreave’s Report concluded that certain areas of IP law desperately need to be adapted to modern forms of innovation, creativity and technology.  Otherwise, warned Professor Hargreaves, we risk losing out on vast opportunities for economic growth.  The UK Government has accepted this overall conclusion and set out its agenda for change.

On the Government’s Radar: Key Areas for Reform

The Government proposes to make changes in a number of key areas including:

	Establishing a new, world-leading Digital Copyright Exchange (DCE) This is by far the most radical proposal for reform and will involve the creation of a freely accessible, virtual marketplace where copyright material is exchanged.
	Opening up the UK’s copyright exceptions regime This will include proposals for a limited private copying exception; to widen the exception for non commercial research, as well as text- and data-mining (an IT tool used to extract previously unknown information from different written sources).  Crucially, the Government’s response states that these new copyright exceptions will not be able to be overridden by contract. Assuming these exceptions to copyright are implemented (and not removed or watered down following lobbying by the copyright industries) these reforms are likely to benefit a wide variety of professionals, particularly academic and research institutions.
	Ensuring the patent system is not anti-competitive and hence, anti-innovation Over the past few decades, the protection offered by patents has been extended to cover various emerging technologies including, for example, within the life sciences and biotechnology sectors. In certain areas, this has resulted in the presence of patent “thickets” - dense webs of overlapping IP rights that innovators must navigate through in order to actually commercialise new technology. The Government has promised to investigate and explore options for resolving these barriers. In addition, the Government is committed to promoting greater collaboration and work-sharing between patent offices to cut backlogs in patent applications. The Government is due to consult on the detail of its proposals over the coming months, following which it will set out its plans for legislating change in Spring 2012.

Our Thoughts

The UK Government’s recognition of the need to bring IP law up to date with today’s "digital economy" is to be welcomed.  The proposals for reform are likely to have a significant impact on the legal framework for IP in the UK, particularly with regards to copyright.

However, as with everything in the legal world, the devil will be in the detail and we look forward to finding out how these proposals will be brought to fruition over the coming months.