Role of the IPO

A different type of roll

Some soul-searching for the United Kingdom's Intellectual Property Office (IPO) comes in the form of the recently published government response to the Hargreaves review on the Role of the IPO. The response begins with “The purpose of the IP regime is to incentivise innovation” which gives you an idea as to the Hargreaves proposed changes.  As Katonomist posts have indicated, your Katonomist thoroughly sees IP regimes as innovation policy, but recognises that this is a matter of opinion. 

The IPO is staffed by dedicated civil servants who 

“promote innovation by providing a clear, accessible and widely understood IP system, which enables the economy and society to benefit from knowledge and ideas.” 

At the same time, the IPO must navigate the waters of politics.  Such waters are known for placing occupants between the devil and the deep blue sea.  Let’s take a look at where the tide is flowing in the case of the role of the IPO.

Hargreaves proposed the following (as paraphrased in the response): The IPO

should have an overarching legal mandate to promote innovation and growth, and state that IPO decisions will be based in evidence and take due account of the impact of the IP system on innovation and growth.  The aim of the proposal was to improve the way in which the IPO gathers evidence to inform the development of policy. To do this, the Review proposed four new functions:

A duty to keep under review the impact of IP and IP rights, and market positions founded on IP rights, on innovation and growth, including adverse impacts on competition and the competitive spur to growth, and to report annually.

Powers to prepare one-off reports on specific areas or cases where there appears to be detriment to competition or consumer welfare.

Powers to require information to support the exercise of these reporting functions.

Powers to make recommendations to the competition authorities, and to fund investigations that competition authorities may make as a result.

These proposals make your Katonomist a very happy kat.  Proper scrutiny of IP under the innovation lens would allow the IPO to better inform IP policy.  A focus on competition and consumer welfare could also provide balance to IP debates which focus on supplier welfare.  But the powers to require information, also know as evidence, are tantalising.  All of that lovely data and the means to access it?  Very nice. (Merpel asks if trade secrecy and privacy concerns would scupper this power.) 

The response continues:

It is, however, important to note that, although growth is the Government’s top priority, there are other issues that sometimes come into play when developing policy on IP. While IP makes a substantial contribution to the UK economy, it also has an impact on society as a whole – on culture, education and the dissemination of knowledge and information.

The Government therefore considers that the most effective way of strengthening the IPO’s focus on innovation and growth would be to require it to report annually on the extent to which its activities had promoted those two ends. This increased transparency would act as a powerful incentive to develop policy based on the best available evidence, and to be clear about the respective weightings given to economic and social impacts on individual policy issues. Where the data are not as robust as we might like, a requirement to report will act as a spur to improve the quality of evidence.

The proposed response to Hargreave’s proposals is to have an annual report. This report is meant to lead to improved quality of evidence.  However, the problem with evidence has nothing to do with the IPO and has everything to do with the fact that either measurement of intangibles is very difficult or that the data is held privately.  This is significantly watered down from the original proposal that the IPO being granted the ability to require information and does not appear to advance the IPO’s current position.  It might, however, bring more attention to problems with evidence as a whole.

The government further proposes, “The IPO will therefore publish, alongside its Impact Assessments, a summary stating the impact that its analysis indicates the policy will have on innovation and growth.” Impact Assessments (some here) already include much of this but a focus on innovation and growth would highlight the policy implications. 

The response also details the potential problems that IP can cause in terms of competition.  The government concludes that “the IPO should strengthen its cooperation with the Office of Fair Trading (OFT). The IPO has therefore agreed a Memorandum of Understanding (MoU) with the OFT.”  This is promising as competition concerns are often neglected in IP debates.

These measures are currently under review – care to comment? Comments can be sent to iporole@ipo.gov.uk by 28 September 2012.

Finally, a disclaimer: Your Katonomist was a fellow at the UK IPO in the academic year 2010-2011.