INTELLECTUAL PROPERTY (MISCELLANEOUS AMENDMENTS) BILL

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INTELLECTUAL PROPERTY (MISCELLANEOUS AMENDMENTS) BILL: Order for Second Reading read.

6.00 pm

The Minister for Law (Prof. S Jayakumar): Mdm Deputy Speaker, I beg to move, "That the Bill be now read a Second Time."

This Bill seeks to amend the Copyright Act, the Registered Designs Act and the Layout-Designs of Integrated Circuits Act. The amendments are:

Firstly, to update Singapore's IPR infrastructure related to these Acts, and to implement our commitments under the USSFTA; and

Secondly, to provide greater certainty relating to copyright licences acquired by the Government.

Copyright Act

First, the Copyright Act. The Copyright Act was amended in 1999 to implement Singapore's obligations under the TRIPS Agreement. When we amended the legislation at that time, I assured the House that the Government would keep our copyright legislation abreast with technological changes as well as in the light of our economic development. The present amendments

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are one of two sets of amendments to the Copyright Act which we will move this year. A second Bill will be introduced in the later part of the year.

Extension of term of protection for copyright works

Currently, the Copyright Act provides for a protection period which covers the life of the author and another 50 years after his death. This applies to literary, musical, dramatic and artistic works. Sound recordings, films and performances are protected for 50 years after the first publication. With clause 2(a) of the Bill, we will extend the term of protection by an additional 20 years for both categories of works. This will provide more benefits to our local creators and give a greater push for the development of Singapore's creative industries. Because international copyright protection works on the principle of reciprocity, a longer copyright term of protection will also provide benefits to local creators who export their works. They will now get to enjoy longer protection in countries which have a similar term of protection. This includes 33 other countries like the United States and European Union members, with more, I believe, following suit.

This is a timely move. Already, we are seeing bustling activity in industries like media design, film and TV production, and the arts and entertainment industries. With this extension of copyright term, we will be able to give our industry players a playing field that is levelled up to their overseas counterparts.

Provisions relating to copyright licences acquired by the Government and Government bodies

This amendment is related to an earlier announcement of a new Government policy where contractors will be able to

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own the IP generated from Government procurement contracts. As a general rule, from 1st July 2004 onwards, the Government will procure a licence to use the IP for its own purposes. The contractor will be able to own the IP, which means he can improve on it and build new products and services to generate more value-added activities for Singapore. As we implement this policy, we must make sure that the public interest is protected. The ability of Government agencies and statutory boards to deliver public services must not be affected, which means that we must ensure that Government and statutory board licences must continue to operate. Hence, subclauses 2(d) and (f) amend sections 194(4) and 195(3) so that these Government licences will still be binding on bona fide purchasers of the copyright. This win-win arrangement is a result of extensive consultation with Government agencies and vendors, and was also a recommendation by the Economic Review Committee last year.

Repeal of Provisions on Compulsory Licence

The third amendment repeals Part Six (VI) of the Copyright Act. This Part allows a user, under specific circumstances, to apply to the Copyright Tribunal for a compulsory licence to translate copyright works into our official languages. Internationally, we need to recognise that a compulsory licence that compels the copyright owner to make his work available should be used only in extreme circumstances. Furthermore, we have not received any requests for the operation of this section since its enactment in 1998. Therefore, to provide greater assurance to copyright holders, subclause 2(b) will repeal Part Six (VI) of the Copyright Act.

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Registered Designs Act and Layout-Designs of Integrated Circuits Act

Finally, I turn to the amendments in the Registered Designs Act and Layout-Designs of Integrated Circuits Act which will let exclusive licensees proceed with legal action without having to involve the owners. May I say that these are similar to the amendments in the Trade Marks and Patents (Amendment) Bills.

To conclude, Mdm Deputy Speaker, this Bill will be an additional step to enhance our copyright regime, to give an extra boost to Singapore's nascent creative industries, as well as to provide exclusive licensees with greater flexibility to exploit and enforce their IP.

Mdm Deputy Speaker, I beg to move.

Question proposed.

Dr Ahmad Mohd Magad (Pasir Ris-Punggol): Mdm Deputy Speaker, thank you for allowing me to speak on this Bill.

It is my understanding that the Bill seeks to amend a number of past Acts that fall under the umbrella of intellectual property (IP). In approaching IP broadly, it is important to appreciate the extent to which competition is increasingly pre-eminent in our law. This was indeed acknowledged by the Minister earlier.

Since the introduction of our intellectual property protection laws in the 80s and 90s, I am glad to note that Singapore has progressed up the ladder as a nation with an environment that encourages creativity and innovation and has correspondingly expanded the recognition of the value of IP in encouraging innovative activities. However, as we do this, it is important that we tread cautiously and not fall into the "mousetrap myth" . I am sure quite a few of us would have heard of this quote in one form or another:

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'If a man can ... make a better mousetrap than his neighbour, though he builds his house in the woods, the world will make a beaten path to his door.'

The quote may be somewhat ambiguous, but many construe it to mean that anyone who invents a new mousetrap will be wealthy, particularly if they can patent it. Well-informed patent lawyers know this as the "mousetrap myth".

Looking back briefly into history, this is a myth illustrated by the experience of Chester M Woolworth, president of the Animal Trap Company. In the early 1920s, the company sold a mousetrap for five cents. In 1928, Woolworth succeeded in improving the trap, but the improved version cost 12 cents. Unfortunately, Woolworth failed to consider that once a mouse had been caught, people usually disposed of both the mouse and the trap. Apparently, as consumers were obligated to clean and not discard a trap costing almost two and a half times more than Woolworth's other trap, sales were low.

A patent would not have improved the appeal of Woolworth's invention. Yet, each year, independent inventors spend millions of dollars on patents. If established manufacturers can make as big a mistake as Woolworth's, imagine the odds of commercial failure faced by those with less experience.

Nevertheless, in the context of a rapidly global environment, I believe it is critical, as the Minister does too, for us to keep pace with changing ideas about creativity, incentives and respect for individual inventions, and also with changes in the new communications media and markets, from printed books to digital television broadcasts.

My modest discussions within the SME community, our creative sector, MNCs and academia reveal a general

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thumbs up for these amendments. The majority heralds the proposed amendments as necessary to be on par with other developed nations and also to gain wider respect of our IP protection environment. I share their optimism that these tools will enable our island nation to enhance its status as a beacon of strength in a fast transforming sea of change. These laws should help harness an individual's or a company's potential and provide a deterrent, at the very least, to unscrupulous business intentions.

While it is noted that a relatively large portion of these amendments takes reference to the US-Singapore FTA, I do not believe that these amendments consequentially behove us to embrace the American or any western system. I note that in the numerous FTA negotiations we have held with the US and various countries, Singapore has always stood firm in safeguarding our country's interest and has, as far as possible, adopted an independent approach with its partner nations. Neither American nor European-centric, our nation has humbly found a position that is unique to our own. An example of this is our copyright protection, which is granted automatically - freeing us from the need to add the ubiquitous 'C' or copyright symbol to every document or speech. Not many may have realised this and therefore have chosen instead to follow the practices of our international counterparts.

Another clause allows our university students to access certain copyright materials without infringing on copyright laws. A 'Class' fee helps balance the academic needs of our universities without compromising the rights of authors and thereby creates a solution unique to our needs.

However, I do have some concerns if the Minister could help clarify. First, is the extension of the copyright protection from the current 50 years to 70 years. At

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first glance, extending protection for creative work by an additional 20 years could be viewed as a step in the right direction. US lawyer Zechariah Chaffee noted in his 1945 Reflections on the Law of Copyright that, "intellectual property is, after all, the only absolute possession in the world ... The man who brings out of nothingness some child of his thought has rights therein which cannot belong to any other sort of property."

However, as a nascent knowledge-based economy, I would think that this would inhibit the exchange and proliferation of intellectual property that should be brought to the public domain sooner for the benefit of consumers. I believe, Madam, our goal in formulating these laws is to strike a balance amongst the three forces that orbit this realm - the creator, the industry and the consumer. By creating a framework that nurtures an idea for an industry, the consumer inadvertently ends up paying for these additional safeguards. Whilst we are not disputing these benefits, as these are distributed, we must ask whether we are going too far in protecting the creator and industry without safeguarding the interests of the consumer, whose interest lies in securing dated material within a reasonable timeframe. Perhaps the Minister could clarify the rationale for the extension.

Another is the removal of requirements for marks to be visually perceptible. The Bill removes the requirement for a trademark to be "visually perceptible" before it is registrable. As a result, this may be interpreted to mean that sounds and smells may be registrable in Singapore. As interesting as the advancement may be for our regime, the mechanics of how such marks are to be described and protected have yet to be determined.

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Given shorter product life cycles, quicker turnovers and rapid changes in technology, could we create an IP regime that parallels our changing lifestyles, our quest for new frontiers and our thirst for knowledge? Using the 20-year life of a patent as an example, could we find a 'sweet spot' where the 'costs' involved in filing a patent is commensurate with the technology it is designated for?

Cost, Mdm Deputy Speaker, is generally what it all boils down to. A segment of our economy has emerged where ideas are now treated as property - to be bought and sold or bartered. Whilst the benefits of this are obvious, especially for large companies, how could we ensure that the SMEs can take advantage of this regime without incurring a large overhead?

How could IPOS help spread the message of IP and, particularly, have our SMEs become more cognisant of these new laws without having them lose sight of their bottom line? Our residents too must also understand the subtle message of these laws. IPOS' campaign to educate the majority of the ills of piracy is an excellent step towards trumpeting this message.

On the average, the cost of filing a trade mark ranges between $1,000 and $5,000. For patents, it can run into a five-figure sum and could take years to finalise. On the understanding that the application process and the technicalities involved in filing trade marks and patents are quite complex, it is in our best interest to provide a means for the lone inventor or scientist with limited resources to affordably access this system. This will help bolster the entrepreneurial drive within our shores and will help remove the stigma that IP is the domain of those only with deep pockets or that of big businesses.

Given its extensive reach, the Government plays an important role in setting the right tone for the private

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sector to follow. We must ensure that the public sector respects and adheres to these lofty goals that we wish to promote. Not too long ago, the case of an entrepreneurial team with an idea to vend food in mobile vehicles was 'adopted' by the URA and balloted to the general public. I feel such actions weaken our position as an example setter and should not be repeated again in the future.

Lastly, Madam, a parting thought as we warm ourselves to the league of nations with advanced IP laws. As we move forward and refine our IP law, could we consider evolving a culture where we balance the valuation of our creative capital with our Asian value system? Could we explore and find an approach that could take away or lessen the burden of our legal system and evolve an environment where ideas and creations are respected in our society in the spirit of fair competition, without always having the long arm of the law to intervene in such processes?

On this note, Madam, I support the Bill.

Prof. Jayakumar: I thank Dr Magad for his comments and strong support of the Bill, and for his feedback that those whom he spoke to gave a thumbs up for the Bill. But he has raised a few observations which I will deal with.

First, he was concerned with the increase of the copyright term of protection from 50 to 70 years. I believe he was concerned whether this was timely, whether we were balancing the needs of the creator, the industry and the consumer. And he was also concerned whether at the end of the day, the consumers will end up paying more and how we are going to strike a balance. Indeed, he is right. As with so many other things in legislation, we have to balance different interests. We have been mindful of this balance.

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First, let me say that on the increase of the term of protection from 50 to 70 years, we have to recognise that internationally, if the copyright term for a local work has expired in Singapore, then other countries with a longer term of protection are not obliged to protect the Singapore work. So, are we worse off or better off? As we answer the question, we should not just take Singapore as it was in the past, or as it is now with a nascent creative industry, but we have to look ahead in relation to our objective of enlarging this area of industry.

Our main export markets already provide for a longer term of protection. As I said, some 33 countries, including US, EU, already provide for a longer term of protection. So when we make this amendment, Singapore creators can enjoy longer terms of protection, not just in Singapore, but also in those countries. I think it is good for local authors, local artists, musicians, producers who have achieved, and some who are achieving, international recognition and whose works have been performed in the region and worldwide. Examples you are familiar with are the late theatre doyen Kuo Pao Kun's plays and Ong Keng Seng's pan-Asian theatre productions, to name just two examples.

On the question of balancing the needs of creator, industry and consumer, let me say that the extension of the copyright term of production does give a greater incentive for more local works to be produced and exported. I would say that this can only be beneficial also for consumers in the longer time. There will be more works produced and over time, these works will enter the public domain.

Copyright fair dealing provisions present in the Copyright Act will continue to operate to ensure a balance between creators, industry and consumers. Let me

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say that there are exceptions such as for the purpose of research, private study, criticism or review, for reporting current events and for libraries and educational institutions. Let me assure the Member that we will continue to monitor international and domestic trends to ensure that the right balance is struck.

He asked how can IPOS help so that the smaller players will not be disadvantaged or will be made familiar with the new laws. I think it is an important point that he has made. It is important to help our local businesses take advantage of the IP regime. IPOS has done its part and will continue to do so. It has launched a nation-wide IP awareness programme with public and private sector partners. IPOS has also developed various free tools to help companies become more savvy about managing IPs. I would not go into the details, but there are several programmes - Surf IP, Scope IP, IP 101 Clinics, Working with Multipliers, IP Taskforce, and so on. And the statistics show that over the last eight years or so, there has been a steady rise in the total number of patents filed by Singapore residents. For example, patent filing by Singapore residents has grown by four times since 1995. And for trade mark applications, the numbers grew by 30% over the last three years, which I think is not insignificant a figure.

He also raised the point about costs. We are conscious about the need to keep costs down and filing fees are benchmarked against other patent and trade mark offices. I would say that the patent and trade mark filing fees here are quite comparable or even less than those charged in other countries. But, in any case, these fees should be seen as a business investment since the fees enable the companies to get protection of their R&D outcome and to market exclusivity.

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He mentioned a point about the URA. I believe he was referring to the mobile food vendor service which was initially proposed by entrepreneurs. He felt it was not fair that the idea was taken away. I am not sure how that is germane to this Bill. The Government will actively play its part in developing a conducive environment for IP creation. I am not familiar with all the details of that case. But let me say, by way of clarification, that idea per se does not fall under the protection of IP laws. This is an international practice, and it is to ensure that IP laws do not constrain the development of new ideas. For patent protection, for example, an idea has to be translated into a product or process before it can be protected. For copyright, the idea has to be fixed in a tangible form, and only the expression is protected. As far as I can remember, in the URA case that he refers to, the idea of food vans in URA-managed car parks was not a new one. I believe that several other companies had approached the URA with a similar proposal. But I take his point, which is a more general point, about entrepreneurship. But it is not really directly related to the provisions in the Bill.

Mdm Deputy Speaker, I believe I have touched on most of the points.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. - [Prof. Jayakumar].

Bill considered in Committee.

[Mdm Deputy Speaker in the Chair]

Clause 1 ordered to stand part of the Bill.

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Clause 2 -

Prof. Jayakumar: Could I have your permission to take my three amendments together?

The Chairman: Yes.

Prof. Jayakumar: Madam, I beg to move,

(1) In page 3, line 2, to leave out, "SAVINGS AND";

(2) In page 5, line 6, after "day.", to insert " "."; and

(3) In page 5, to leave out line 7 to line 21 in page 6.

Basically, Madam, the amendments are to delete section 268 from the Bill. We drafted the new section 268 as a savings provision, to cater for the possibility that an investor may have invested resources in a certain work, expecting the copyright term to remain 50 years. We did not want to inadvertently penalise this investor because of the extension of the copyright term to the new 70-year term. Hence, section 268 would have enabled such an investor to retain his ability to continue with his plans, as long as he pays an equitable remuneration to the right owner.

We have received further feedback that this provision creates some uncertainty for businesses, and that we should avoid creating such uncertainties. After all, the group of investors section 268 addresses is likely to be very small, if it exists at all.

Madam, this is an issue of extending an existing right, which investors would be familiar with. We are not dealing with the creation of a new right, which had not existed previously. Furthermore, the extension of the copyright term of protection is covered under the US-

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Singapore Free Trade Agreement, the text of which was made public more than a year ago, in March last year. Since then, IPOS and MTI have held many public consultation seminars to discuss the changes to our copyright regime. Any businessman, who had plans to invest in copyright works, would have taken an active interest in these discussions, and adjusted his plans accordingly.

Madam, I beg to move.

Amendments agreed to.

Clause 2, as amended, ordered to stand part of the Bill.

Clauses 3 and 4 ordered to stand part of the Bill.

Bill reported with amendments, read a Third time and passed.