The United Kingdom’s recent Intellectual Property Bill (the Bill) is intended to modernize the IP system in in the UK to ensure it “operates more efficiently, is clearer and more accessible, thus increasing legal certainty.” The Bill, which has a primary focus on patents and designs, has broadly been welcomed by businesses and commentators alike.

Criminal Sanctions for Infringement

One aspect is, however, proving controversial. This is the proposed introduction of criminal sanctions for infringements of registered designs (Clause 13) in circumstances where the infringer has, in the course of business, copied the registered design, with penalties of up to 10 years imprisonment, an unlimited fine, or both.

The stated intent behind the proposal is to: (1) strengthen the protection of design rights through giving creators an extra tool to help protect their designs from copying; and (2) to show recognition that the creativity of designs is as important to the economy as music or the written word (which is protected by copyright) and brands (which are protected by trademarks) – in respect of both of which criminal sanctions are already available under statute. See Bill Overview; see also the IPO’s Report: The Consultation on the Reform of the UK Designs Legal Framework Government Response (April 2013).

Yay or Nay to Sanctions

Not all stakeholders share enthusiasm for the proposal. The IP Federation, which is a membership organization that represents the views of UK industry in both IP policy and practice matters, opposed the proposed introduction of these criminal sanctions. In an open letter the Federation argued that criminal sanctions would create an over-deterrence that would be damaging to innovation as the threat of criminal sanctions would discourage international companies from investing in and commissioning design in the UK. See Federation Policy Paper.

Supporters of the proposals argue that the same protection should be afforded to designs as exists under current copyright and trademark law as the current civil law sanctions are inadequate and not enough of a deterrent. Supporters of Clause 13 have also argued the criminal sanctions should not be restricted to registered designs and should be extended to cover unregistered designs.

Parliamentary Compromise

In the third reading of the Bill in Parliament earlier this month the concerns surrounding the introduction of Clause 13 were considered. A compromise of sorts was proposed whereby a defense of ‘good-faith belief’ that a design was not ‘a copy’ of a registered design should be available, provided that the belief is based on reasonable grounds. See Parliamentary Third Reading.

Whether the addition of this defense will satisfy the various stakeholders remains to be seen.

The Bill will now go back to the House of Commons for further consideration later in the year and we will provide a further update in due course.