§ Order for Second Reading read.
§ The PARLIAMENTARY SECRETARY to the BOARD of TRADE (Mr. Hore-Belisha)
I beg to move, "That the Bill be now read a Second time."
1891 I hope that the House will approve of the method of presentation which we have adopted in connection with the Bill which I now introduce. A White Paper has been laid which sets out, in what might be termed consolidated form, the whole of the legislation relating to patents and designs, so that it is possible to read it in sequence as a narrative. By employing varying types of print, we have been able to show where the text remains unaltered, where it is proposed to omit certain words or passages from the text and where it is proposed to make insertions in the text. In this way we have avoided the evils attaching to legislation by reference, which has been so much criticised.
In our consideration for the convenience and time of the House, and of those interested in these matters, we have added in the Bill, in the margin after each Clause, certain figures in brackets indicating passages in the Report of the Departmental Committee upon which the Clauses are based. The Bill is to give effect to the recommendations of the Departmental Committee. The Committee was appointed in May, 1929, and it reported in March, 1931. In those two years, it made an exhaustive examination of all the legislation connected with patents and designs, and heard evidence from every quarter. The constitution of the Committee was such as to ensure that the members had particular qualifications to make sound recommendations to the Board of Trade. It was presided over by Sir Charles Sargant, a former Lord Justice of Appeal. I think we have followed their advice almost entirely. The Committee was appointed by the last Conservative Government; its main recommendations had the approval of the Labour Government, and we have seen no reasons to dissent. On the contrary, we have seen every reason to advance those recommendations in our desire to improve the status of patents in this country.
The actual proposals are, of course, intricate and technical, but the House will be able to follow them, because of the method of presentation to which I have referred. Some of the Clauses are merely a statement of the existing law; Clause 3, for example, which sets out the grounds upon which patents may be revoked. Other Clauses, such as Clauses 11 and 6, remove certain weaknesses 1892 which have been disclosed in our present practice. I do not think that I need fully explain to the House what those weaknesses were, for they are so fully examined in the report of the Departmental Committee. There are, however, two major changes in the. law to which I deem it my duty to make some reference. The first relates to the area of search. As the House is aware, when application is made on behalf of an invention for a patent, it becomes the duty of the Comptroller of Patents to make a search—I am now dealing with Clause 2. The scope of the search is at present statutorily confined to the public specifications deposited in applications made in the United Kingdom within the previous 50 years. That is to say, the Comptroller may look only at British specifications filed in the previous half century. Anyone who, at a later stage, wishes to take objection to the patent, may cite other documents, and disprove the novelty of the claim. Accordingly, we propose to allow the Comptroller, at his-discretion, in the future to extend his search to any document other than British specifications in which he is of opinion that a possible anticipation may be found. It may be that this will involve the Comptroller in some additional expense, and it is only right that that expense should fall upon the shoulders of those who benefit from his labours. Consequently it is made permissive to increase the fee; charged on the filing of the complete specification, by up to one pound, and this will cover any further cost which may be incurred.
The second major change concerns the jurisdiction of my hon. and learned Friend the Solicitor-General. As the law stands to-day, there is an appeal from the Comptroller, at any moment up to the granting of the patent, to the Law Officer of the Crown. He is the judicial authority. His authority is a historic authority, and is not founded on utility. We propose to remove that authority from him, and to transfer it to a Judge of the High Court, a judge who will he appointed because of his knowledge and experience in Patent Law. This, of course, is not to lay any criticism upon the manner in which the Law Officers of the Crown have hitherto adjudicated. There is no reason to believe that their decisions have given anything but com- 1893 plete satisfaction. Apart from that consideration, the House will bear in mind that Law Officers come and Law Officers go. They change with each Government, but judges, or at any rate some of them, seem to go on for ever. Perhaps I should say that the Judicature is permanent, whereas the Law Officers of the Crown are not, and, therefore, I trust that the House will agree that it is a convenient as well as a logical change that the jurisdiction now exercised by my hon. and learned Friend shall be transferred to a Judge of the High Court.
Those who have had audience hitherto before the Law Officers of the Crown may have been either counsel or solicitors or patent agents, and we do not propose to deprive the parties to an appeal of such representation as they have hitherto enjoyed. It will, therefore, be possible for them to instruct counsel or solicitors or patent agents to appear before the learned judge, just as they have instructed one of these categories to represent them before my hon. and learned Friend. I hope that this will not involve any increased commitment to the taxpayer. There is no reason why it should. There are only about 36 appeals in any given year, and the staff at the Law Courts ought to be quite adequate to deal with the slightly heavier work which we shall cast upon them. I do not think, therefore, that the economists need have any fear that the taxpayer will have to pay a greater contribution.
These are the major proposals of the Bill to which I deemed it my duty to refer. These two major proposals, coupled with the other Clauses of which I have made a cursory note in passing, do, in the opinion of those qualified to judge, definitely put the British patent on as high a basis as that claimed to be enjoyed by any other patent in any other part of the world.
§ Major PROCTER
Doubtless there will be opportunities of discussing in detail the various Clauses of this Bill. Tonight I should like briefly to call attention to the wonderful opportunity that was presented to us of producing a monumental Measure which would make British patent law at least equal to any patent law in the world. Despite what the Parliamentary Secretary has just said, I beg leave to join issue with his statement that this Measure will make 1894 the standard of the British patent equal to that of any other in the world. At the moment the monopoly which is granted by a British patent is infinitely weaker than that granted by Germany, and far more expensive than that granted by America; and the search, of which the hon. Gentleman has just spoken, which is undertaken by the examiners, is not as efficient as in either of the two countries which I have just named. One of the weaknesses of this Measure is that discretionary, and only discretionary, power is given to the examiner to make a search in those countries in which he thinks there might be the possibility of anticipation. What is the effect of this; and what is the effect of the law as it is at present?
An inventor may apply for a patent in this country. He may be a poor man—many inventors are poor men. The search is made, and he is granted a patent, not because he has produced any new technical effect, as is the case in Germany, but because he has made some slight improvement, which in his opinion is a real improvement. He applies for the patent, a search is made over the last 50 years, and then he goes away rejoicing. He may find some financier who will put his money into that patent, only to discover that, after the expenditure of, perhaps, thousands of pounds on the part of the financier, and the work of many years on the part of the inventor, the monopoly which he has been granted by the British Government is not worth the paper on which it is written, because it has been anticipated in some other country where the examiner has no statutory power to look for such an anticipation.
Therefore, it seems to me that the word "discretionary" should be expunged from the Bill, and that we should do what America and Germany do, namely, make a world-wide search, so that the man who has not the resources that the Patent Office has can avail himself of those resources and enlist the aid of the examiners in amending his specification so as to meet possible anticipations in other countries, and thereby make his patent a valid patent. If this were done, a British patent would then be equal, in the estimation of those whose business it is to exploit patents, to a German or an American patent. I am sure it would be a source of pride to this National Government if, instead of the inquiry 1895 being made, as it is at present, "Have you a German patent?"—because that is the highest of all patents from the viewpoint of validity—the financier will say, "Have you a British patent?" and that will be the hall-mark of the validity of a patent monopoly.
Then there is the wonderful concession that has been given, that, for an increased fee of only one guinea per year, this discretionary power will be exercised, not if the inventor desires it, but if the examiner or the Comptroller desires it. I would call the attention of the House to the fact that one of the most expensive patents in the world is the British patent. It has been said, I think by the President of the Board of Trade, that the inventor is of far greater worth than the politician. At any rate, if we look at the history of our country, we shall see that the milestones that measure its advancement are the inventions that have been produced by our countrymen—poor men like Arkwright, Compton, and the rest, who made it possible for 44,000,000 people to live in a country that is only capable of sustaining by its own resources 12,000,000. And yet how greatly were these men penalised! An inventor—he may be a workman—has to pay £155 for every patent that he produces. If he takes out a patent this year, and then makes a slight improvement next year, for each patent that he takes out £155 is demanded as tribute by the British Government in order to give him a monopoly and protection for 14 years, after which period his invention is added to the storehouse of wealth of the people of England to use. In America the fee is £8, and that includes a world-wide search.
I hope the House will not be satisfied with the Bill. While many learned men well versed in patent law have been con suited, I do not know whether any inventors have been brought into their consultations. It seems to have been made by lawyers in the interest of lawyers and not in the interest of inventors, and especially poor inventors. I suggest that it might be possible for the Government to see at the forthcoming Ottawa Conference if it is not possible to get an inter-British Empire patent, so that, instead of a man having to take out a patent in England and others, if he wants 1896 protection, in the Irish Free State, Ceylon, India and every one of our Possessions separately, he could have one all-comprehensive patent which will give him protection throughout the British Empire. I hope at a later stage to make some suggestions whereby the inventor will get a better deal than the Bill gives him. The Patent Office has been a great source of income throughout the years. I hope, if it is a question of economy, that it may be found possible to reduce the holidays of some of the officials and give the inventor the benefit of this increase of £l that you are putting on him, and you will have done something to help the cause of invention upon which we so much depend.
§ Lieut.-Commander ASTBURY
There is one Clause in this Bill which, if passed into law, will do palpable harm to the cotton trade of Lancashire. It is Clause 53 (3), the effect of which is to cut down the present 15 years' duration of a patent to 10 years. When I tell the Parliamentary Secretary that for the third five years we are paying 20 times as much as for the first, it will be apparent to him that we are placing a great value on the last five years. These designs are to a great extent for foreign nations, and they are for those nations where we are facing the fierce competition of Japanese trade. If we cannot get these designs retained for the five years, it means that the Japanese can come in and more readily cut us out. In most other countries the duration is for 15 years. In France it is for 50. When I tell my hon. Friend that in China alone there are designs going today which were put on 100 years ago, he will, perhaps, realise the great safeguard that it is to those concerned in the trade of Lancashire. I am not speaking simply on my own behalf; I am speaking on behalf of the Federation of Calico Printers and of the merchants in Lancashire. I raise the question to see if my hon. Friend will give the matter serious consideration between now and the Committee stage.
§ 10.0 p.m.
§ Sir F. FREMANTLE
I want to raise the question of the patenting of food and drugs and to call attention to a point of great and growing importance which is omitted from the Bill designedly because of the difficulty of the subject. I should 1897 like to ask for some explanation of the attitude of the Ministry in regard to this most important point. I do not think it is sufficiently known that the patenting of a large number of the most important medical drugs and medicines recently discovered is subject to a patent law which has, unfortunately, put our research at the mercy of certain foreign countries. The position is extraordinary. I think most people will know the vital difference to the food of the country between fresh butter and margarine. Margarine is coming more and more into use, naturally enough, and yet it has been discovered of recent years that what it really lacks is a certain substance called vitamin D. The discovery of vitamin D was made only a few years ago, and it was due to research in this country when it was discovered how, by the use of ultra violet rays, it could be produced out of a certain material called ergosterol. Unfortunately the patent for the manufacture of this vital material was taken out by Professor Steenbock, a worker in an American university, and it is known as the Steenbock patent. It gave patent rights over not only America but all other countries, including this country, for all forms of manufacture of vitamin D. Professor Steenbock gave the patent rights over to the university. The university submitted it to a committee, and it is run by the committee for the benefit of that university.
The patent rights are made out with definite conditions in this country which are found to be very hampering to research. It is considered that the patent ought not to cover the more modern processes, which have not been discovered there but here, and would, as is the custom in this country, be given to the research workers for their free use. The university has built up very large sums. It is a wealthy corporation and no one cares to challenge its rights. It is extracting large royalties from all who use this process of treatment of our food, and it is also hampering our research work. A large amount of the very best work is done in these subjects by the big manufacturing houses, but they find it worth while to pay the royalty rather than fight a corporation of that sort. They pay the royalties themselves and pass it on to the consumer, so that our consumers suffer because our patent 1898 rights are not sufficient to protect us against the patent rights taken out in America.
In the same kind of way we are at the mercy of a foreign patent with regard, for instance, to the subject of insulin. When insulin was discovered in Canada, the patent right was given over to a Canadian University, which most nobly gave it to our Government. Our Government passed it on to the Medical Research Council, and they are able to use the patent rights in insulin and to prevent any commercialisation of it, which would have been fatal to a large number of our people, and they have seen that it is properly used and produced. There is a third product, the discovery of Dr. and Mrs. Dick working together in Chicago. They discovered the streptococcus of scarlet fever, the toxin and the antitoxin serum. They took out patent rights and gave them to the University of Chicago. They were used commercially and mercilessly by the committee running the trust, and the result has been to hinder and very largely to stop research in this country.
These matters were put before the Board of Trade by the Medical Research Council three years ago with a view to giving evidence before the Departmental Committee upon whose report the Bill is founded, yet no action has been taken officially to incorporate their representations in this Measure. I maintain that that is a serious blot, although there may be good reasons for their omission. Perhaps it may be one of expediency. It is a very difficult subject, and I feel that the matter requires considerable explanation. If the Board of Trade are able to give good reasons for not including this most important principle in the Measure, I hope that they will be able to give some kind of undertaking that they are seriously considering the matter, which goes right to the root of the health of the people of the country. It is a matter which requires investigation even if it cannot be brought in as an Amendment to the Bill. A conference was called by the British Medical Association and it was attended by the President of the College of Surgeons and Physicians and members of the Medical Research Council and the matter was gone into. They came to the conclusion that they would first of all see the Board of Trade, and, having 1899 seen them, they were asked to consider whether it was advisable to move an Amendment to the Measure. We have been asked not to move any Amendment at the present time. We can only implement that undertaking if we are given some pledge from the Board of Trade that they recognise the seriousness of the position.
The matter requires a good deal of international work, and a good deal of thought as to what we can do in this country. The medical profession definitely maintain that the results of research should be open to everybody and be above board, and it should be applied to universal use, and that there should be no patent rights whatever. As regards what are called animal medicines and products, vitamins, sera, anti-toxins and the rest of them, no patents should be allowed which are a disadvantage to other countries. As regards synthetic compounds made by chemical drug houses and so on, it would be impossible that patents should not be given for those purposes, but as a common practice, and a right one in this and other countries medical men should not be allowed to take out patents to make a profit out of them. It should be compulsory, as the conference suggested, that patents for such articles for medical use should be dedicated to universities or some public trust or body for general use. We require legislation to deal with all these matters. No doubt the League of Nations and their work and international matters come in, but it takes a long time to get anything through the League of Nations as we know full well, or internationally. In the meantime we ought to act. There are signs that we are not acting, that the Department do not understand these things, and that the Government are paying no attention whatever to them. I hope that we shall receive some explanation from the Board of Trade that they realise the seriousness of the situation and that they will do something to consider the matter in due course.
§ Sir S. CRIPPS
I did not intend to intervene in the Debate because I thoroughly agree with what is in the Bill, but there is one matter which the hon. Member for St. Albans (Sir F. Fremantle) has mentioned upon which I 1900 should like to say a few words. He has pointed out the difficulty as regards medicines and food products. The difficulty he mentioned with regard to ergosterol I know very intimately from inside information, but there is one way in which the difficulty can be overcome and that is by giving the Government power to expropriate patents. At present the Government have power to take patents, but only for the purpose of war uses; that is to say, if someone invents a particularly poisonous kind of bomb, the Government can acquire it for the purposes of national use, subject, of course, to compensation settled by the Treasury. I do not see any reason why a useful article such as some medical or food product should not also be subject to acquisition by the Government in the same way, and why it should not be capable of being put into safe custody to be used under the auspices of the Medical Research Council or some other such body for the benefit of the whole community.
I would point out to the hon. Member that there might be other cases beside foodstuffs where it might be very desirable for the Government to be able to get the use of patents. Let me take a case which may not necessarily be a case in point, but suppose that the Government decided that they wanted to produce oil from coal or that they wanted to enter into the organisation of a body which could do it, some public utility corporation, at the present time the Government would be practically helpless because of the patents which would stand in the way. There would be no power to acquire and expropriate those patents for the purposes of some such national utility corporation. The only way by which any powers to use them could be got would be by applying to the Comptroller for a compulsory licence under each of the patents. It would be an unsatisfactory means of doing it. I do not criticise in the slightest degree the Comptroller or the way he exercises his discretion in the matter, but it is done in a way very often which does not succeed. I suggest to the hon. Gentleman that if some Clause could be put into the Bill which would extend the existing power to expropriate patents—patents other than those applied to war purposes—it would enable the Government 1901 to get over the difficulty both as regards foodstuffs and the possible anticipated difficulty as regards other matters. There would be no question of confiscation. The terms would be the same as those which exist as regards war material, and it would really be an extension of the existing powers to cover, if required, other matters besides war material.
§ The SOLICITOR-GENERAL (Sir Boyd Merriman)
I do not think that it is necessary for me to reply at great length on the Bill, because no one is seriously threatening to oppose the Second Reading. But, as regards one or two of the criticisms which have been made, I should like, first of all, to answer the point made by my hon. and gallant Friend the Member for West Salford (Lieut.-Commander Astbury) who spoke about the curtailing of the period for renewing designs. I need scarcely say that if it can be shown that it is going to have a serious effect upon any particular industry the matter will seriously have to be considered in Committee. But I should like the House to understand that the Clause has been put into the Bill upon the recommendation of the Departmental Committee on the strength of statistics which were put before them to this effect, that the first period of the renewal was only applied for in under 8 per cent. of the eases, and that the second period of renewal of copyright and designs had in practice only been applied for in 1.3 per cent. of the cases. It really does not look, therefore, as if the curtailment of the right to make a second application is one which, prima facie at any rate, is likely very seriously to affect industry.
§ Lieut.-Commander ASTBURY
Would my hon. and learned Friend allow me to say that; the 8 per cent. is the proportion, or some part of the proportion, which, as I said, deals with designs which we are sending to foreign countries, and those are countries where we find the fiercest competition with the Japanese.
§ The SOLICITOR-GENERAL
I need scarcely say that any representation upon that matter which may be made in Committee—I cannot say more than that—will receive further consideration. With regard to the point made by the hon. and gallant Member for St. Albans (Sir F. Fremantle), about research, let me 1902 say that there is already power to compel people who make anything which is the subject of a patent, available for the public service. That, of course, involves the payment of royalties to the inventor. I suggest to the House that there is no reason why a man who has made researches connected with health should be deprived of the result of his researches. Indeed it is not to be expected that he will devote his life to making researches unless he is going to get some reward for it. There is no more reason why a person who has spent his life in research and invention in connection with health should be deprived of the fruits of his labours than should any other inventor. The logical result of my hon. Friend's suggestion is to be seen in the intervention of the hon. and learned Member for East Bristol (Sir S. Cripps), who went further and said that the Government should be able to appropriate inventions of any sort. As the hon. and learned Member knows, there is power under the existing law to enable the Government to appropriate for public service. It is true that there are special provisions with regard to munitions of war, keeping plans secret, etc., but, as I understand the law, there is no more power to appropriate without compensation in the case of munitions than there is in the case of any other invention.
§ Sir S. CRIPPS
I think I am right—I had not the Statute before me—that the power, although it appears to be a wider power, when one reads the Section, is limited to such things as are useful for war purposes, and so on. That is certainly my impression.
§ The SOLICITOR-GENERAL
Wider power is contained in the earlier Section which enables any Government Department at any time to exercise and use an invention for the service of the Crown. That is not one relating only to war service.
§ Sir S. CRIPPS
But "the service of the Crown" has been interpreted as meaning the Air Force, the Army and the Navy and not as meaning any other service, such as running an electricity plant, or anything of that sort.
§ The SOLICITOR-GENERAL
I should not like to be positive about that, but I would point out that it is the next sec- 1903 tion which deals with the question of munitions of war and expressly mentions the War Office, the Admiralty and the Air Service. However that may be, I want to make it perfectly plain that the Government are not prepared, as at present advised, to consider any question of expropriation, without compensation, of any particular form of invention.
§ The SOLICITOR-GENERAL
I was not referring to what the hon. and learned Member said, but to the hon. and gallant Member for St. Albans, who held the view that in regard to any question of health and medical research it should be made open to the public and should not be the subject of patent. The hon. Member for Accrington (Major Procter), who has great experience in these matters, made an appeal for a much wider and ampler Bill. That may be an excellent ideal for the future. This Bill is professively a modest Bill. It is designed to give literal and absolute effect to the recommendations for an amendment of the law which were made by the Departmental Committee. It is nothing more or less than that. We claim that the Bill does this. It may be that something more may be done in the future but we ask the House to-night to let us have this modest Bill.
§ Dr. O'DONOVAN
There is a great difference in the outlook on life between the legal and the medical profession, and it is because of that that the Solicitor-General has not followed whole-heartedly the lead given him by the hon. Member for St. Albans (Sir F. Fremantle). My profession has always resented any suggestion coming from His Majesty's Government that we have the right to exploit the people. There is no question that patents can be used for exploitation, and the idea that the sons of Hippocrates should be unfaithful to an oath which has been held for over 2,000 years has been made for the first time this evening. To me the suggestion is repulsive. It is true that chemists are entitled to the result of their studies in organic chemistry, but that the results of medical research should be followed by action and that 1904 again protected by patent is a conception which is new to the ideals of medicine. I was grieved to hear it from the Front Bench, and I hope that the point which has been put so boldly by my hon. Friend the Member for St. Albans will be borne in mind by the Government in the future discussions on this Bill.