Trade Marks (International Treaties and Enforcement) Amendment Bill

I wish to advise that in the course of this debate, I have been offered some counterfeit goods. I will just find them here. It is pretty serious, but it is what happens with modern technology. It is very straightforward. It says “Buy cheap, pirated software here”.

💬 Hon Rodney Hide: Where?

Well, I will tell the member: “http://”—is the member taking this down?

💬 Hon Rodney Hide: Yep.

—“cheapestsoftinc.com/”. Shall I do that again or did the member get it the first time? OK. The Hon Rodney Hide, sharp as a knife, got the website stuff down the first time. The point is that even as we have been debating the ubiquitous nature of counterfeiting and its omnipresence, it came up on my phone. Unbelievable! Who would have thought? I do not know whether anyone else has checked their phone to see whether they have been tempted with counterfeit goods, but I have in the course of this debate. If necessary—and the officials could indicate this to me—I would be happy to forward this email on to them for further investigation, should they wish. The point is that with modern technology, any form of counterfeiting is pretty straightforward, and all of us know all the spam we have to clear off our little phones, laptops, or whatever they may be. Every morning from the night before, there will be some counterfeit goods on the market. That is why legislation like this matters.

It matters for another reason—that is, that this country will not get there on cows and tourism alone. We will have to look to the innovative components of our economy and the innovative nature of our people and our ability to protect the intellectual property that New Zealanders devise if we are to have an economic future that will have a broader base than exists at the moment. That is why we need to be reasonably staunch on intellectual property matters.

Last year I was in Geneva. I went up to the World International Property Organization—I dropped in; I rang first. I dropped into the World International Property Organization for an afternoon and I asked a few questions. The World International Property Organization is one of the bodies of the United Nations. It is headed up by an Aussie guy, quite a smart guy. Pretty much, my question was that now that the world economy is changing from the dominance of so-called developed nations to the greater hegemony of China and India, in particular, but also in due course Brazil, Russia, Indonesia, and so on, are we seeing a change in the average approach around the world to intellectual property, or is the white man’s approach to intellectual property, which is to defend it staunchly, still in the ascendancy? Answer: we are seeing a change. It is not a big change, said this guy, but it is there. As there are now more and more developing countries joining the world economy, and some of them with spectacular pace, their attitudes to intellectual property, which is not as defensive or protective as ours, are starting to infuse the debate globally a little.

He made the second point that as those countries make more money from their intellectual property, so the value that they place on intellectual property will rise. Let us take India as an example. It is a massive producer of generic pharmaceuticals. It is a huge producer. Dr Reddy’s Laboratories recently sold out—one of the world’s largest pharmaceutical companies. A massive export for India had been these generics. Well, not any more. More and more, India’s pharmaceutical effort is going into original molecules. More and more, India is not the one waiting for the patent to drop away or for the time-limited patent to come to an end. More and more, India is the one that is trying to get the product to market in a timely way, because that country is moving from being, if you will, a copycat to an originator.

So too, to an extent, is China. It may be to a lesser extent, and it may also be that in China it is a lot more variable. But China now has an extraordinary effort going into its scientific endeavours that did not exist even 10 years ago. In parts of Beijing, the north-east quadrant of Beijing, there are more universities than Australia and New Zealand put together in that one city. The intellectual capacity of some of those centres is now bewildering, at least to a New Zealander. China is famously good at counterfeiting and ripping people off. The Lord of the Rings was launched in Wellington one day and could be seen in Beijing the following day. Those days are still with us, but they are in retreat a little. I suppose that as things move on and as the next and last continent—which is, of course, Africa—goes through that process of development, we will see the whole thing play out again, perhaps not in my lifetime but certainly in my children’s lifetime.

I think that our approach to intellectual property will probably remain in the ascendancy foreseeably, but it is true that it does change as new, big, bulky countries join the international trading arena, as China and India have done so spectacularly in recent times.

I would like to take another call on the Trade Marks (International Treaties and Enforcement) Amendment Bill. One of the most important things about the impact of this bill, apart from stamping down on the illegal trafficking of materials and counterfeit merchandise into New Zealand, is that it is about encouraging innovation. It is about taking legislation and trying to update and modernise it. That is a really important thing to do. I commend the Government on doing that and hope that all other legislation is treated in that vein.

It is important that all Governments take the view that they do not know everything and that they can move with the times and learn a few things along the way. I note that the Minister in the chair, the Minister of Commerce, is shaking his head, so I guess that means he disagrees with me and that he thinks he does know everything, which is a pity because he does not and it would be a good thing to acknowledge that.

The important thing about this bill is the extent of the problem. I think Pete Hodgson talked about the 260,000 items that are being detained each year. I do not know when that figure was last updated, but that is a lot of items. It could be that there are many, many more items out there that could be detained. Prosecutions could be brought, and the national enforcement unit could exercise its powers and become much more efficient. There would be the effect of stamping down on the illegal counterfeiting of goods and pirated works, which is ultimately the intent of this bill.

I would just like to say, I guess from the industry’s point of view, just exactly how industry is likely to benefit from the enforcement that will occur across the nation, hopefully, as a result of the bill. I think it is difficult to quantify the benefits, which was acknowledged during the development of the bill. It was said that enforcement action by the national enforcement unit is expected to lead to a significant reduction in the manufacture, importation, and sale of counterfeits in New Zealand through that deterrent effect. We are talking about large numbers of items and the significant ability for people to make money out of them. That deterrent effect is really important.

The reduction in the sale of counterfeits is likely to result in increased sales for rights-holders, an increase in their profits from the New Zealand market, and an increase in the reputation of the quality of the rights-holders’ goods. That is that important brand I was talking about. As Pete Hodgson has rightly said, there can be a difficulty in determining the difference between the real bona fide brand and the counterfeit brand. It is extremely important that the manufacturers of those bona fide brands have the ability to reap the rewards and the profits from them, rather than having to compete against those knock-off items, as they have been described.

Although the knock-off items might not look a lot different, generally they are different and are of much poorer quality. We have also heard that in some cases there are personal health and safety risks associated with them. One of the memorable phrases from tonight is “exploding pyjamas”. I am not quite sure whether that was what was meant, but it has certainly left an enduring visual memory, in terms of the impact of those exploding pyjamas.

I move, That the question be now put.

Like a bill we were debating earlier on in the evening that dealt with the tracing of animals, the Trade Marks (International Treaties and Enforcement) Amendment Bill assists New Zealand in developing our position in the 21st century global economy. It assists with dealing with both the opportunities and the threats that our existence as part of a global economy presents to us. The opportunities of developing our own intellectual property and our own particular niche goods and services and being able to export them to markets around the world is a very important opportunity for New Zealand. Trademarks and copyrights of that intellectual property and of those goods are important for New Zealand’s ability to express our high-value brands around the world—the likes of Zespri, Fonterra, and Beef and Lamb New Zealand, for instance. These are known as high-quality products around the world, and we need to be able to protect them.

We also need to be able to protect our own consumers here in New Zealand to ensure that they know when they are purchasing a product that has been imported into New Zealand whether they are purchasing the genuine article or something that is a knock-off of the genuine brand. As has been discussed, it is sometimes quite difficult to determine whether a product is the real thing. As our economy develops and grows, it will be about not just protecting our well-known agricultural brands but also being able to develop new technologies and new ideas, and being able to send those into niche markets around the world as well.

For those reasons, although the material in this bill is reasonably dry—and there has been some amusement about the debate this evening—it is hugely important and it does warrant discussion in the House. Although these things do tend to get a little bit overlooked, and it is not the sort of thing we expect to read on the front page of the Dominion Post, the functionality of a bill like this and of New Zealand signing up to the treaties that are ratified in this bill is actually hugely important for our ability as a nation to deal with some of the trade deficits that we are dealing with in this country—the fact that we are still importing more than we export—and our ability to go out there on the world stage and make some money. That is all embedded deeply in this legislation and, indeed, in the animal tracing legislation that we dealt with earlier on in the night.

Labour is very much in favour of this bill. It is our pleasure to continue to support it. We hope that its commencement occurs in as timely a fashion as possible and that its progress through the House is able to continue. I do not have too much more to add to the debate at this point, so I shall take my seat.

I move, That the question be now put.

The CHAIRPERSON (Lindsay Tisch): I remind members that we are on clauses 1 and 2, which are the title and commencement clauses. You must bring those into the debate.

I want to start on the commencement clause because, as has been pointed out by a number of the speakers tonight, the Trade Marks (International Treaties and Enforcement) Amendment Bill was first brought to the House in 2008. Now, in 2011—3 years later—it is certainly our wish that the bill passes as quickly as possible and gets through to its third reading—

💬 Hon Rodney Hide: Great!

—and is able to move into law before Parliament goes into recess. The interjection of Mr Hide makes me reflect on the fact that in this Chamber tonight there are a number of people whom we will not be seeing after that time: Mr Locke, Mr Hide, Mr Hodgson, Mr Power, and Mr Henare, who is at No. 40. The House will be a sadder place for their not being here.

💬 Hon Rodney Hide: I’d swap 40 on National to Mt Albert for Labour.

Mr Hide does not have to worry about that wherever he goes.

Let us get on to the bill. This is the Trade Marks (International Treaties and Enforcement) Amendment Bill. As has been said, this bill is more of an omnibus bill. It will amend both the Trade Marks Act 2002 and the Copyright Act 1994. These two Acts—again, as has been said during the course of the debate—are extremely important for New Zealand. The idea of us protecting our intellectual property is something that perhaps we do not take as seriously as we possibly could. I am thinking about trademarks. Somebody mentioned Adidas, but we could easily also mention Canterbury Apparel and the Kathmandu clothing range, for example. These are all New Zealand products that could be copied or changed in some way. They are certainly identifiable as New Zealand products. Making the cheaper rip-offs, or rip-offs that do not involve the research and the marketing behind the products but just use the symbol or the actual product itself without all of that investment, is unfair. It certainly disadvantages those designers and manufacturers who have put that effort in.

This bill also gives effect to the Government’s decision to accede to the Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks. It enables us to accede to the Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks, which is known as the Nice agreement. As we said before, it will give us the ability to sit at the Nice classification, which is updated on a 5-yearly cycle. Parties to the Nice agreement consider amendments to it, and we will be able to consider amendments that will be advantageous to our manufacturers and our businesses here in New Zealand. Finally, it ratifies the Singapore Treaty on the Law of Trademarks, which, as was mentioned earlier in the debate, aims to make national trademark registration systems much more user-friendly and reduce business compliance costs for trademark owners. That is obviously not only important for our businesses but also important for those out there who may be tempted to flout the law of both copyright and trademarks and try to produce goods that infringe that law. That treaty enables them to at least understand exactly their position under law.

It would also, as I mentioned before in the debate on Part 2, empower the three agencies that relate to this bill: the Ministry of Economic Development, the Customs Service, and the police.

I move, That the question be now put.

I raise a point of order, Mr Chairperson. I just point out that debate on clauses 1 and 2, which is the conclusion of the Committee stage of the debate, is often wide ranging, and it is a surprise to me—

The CHAIRPERSON (Lindsay Tisch): I know what the member is saying. I have listened intently. There have been more calls on clauses 1 and 2 than on Part 2. I brought to the Committee’s attention that although this is a peroration, a tying-in, the title and commencement must be mentioned because in previous speeches they have not been mentioned. I feel that at this stage we have run the course of time and there is no new material. I have accepted the closure motion.

I raise a point of order, Mr Chairperson.

The CHAIRPERSON (Lindsay Tisch): If the member is trifling with my decision—

I am certainly not. I seek leave to give a contribution of no longer than 5 minutes, strictly around matters to do with commencement.

The CHAIRPERSON (Lindsay Tisch): Leave is sought for that purpose. Is there any objection? There is no objection.

Very good, Mr Chairman.

💬 Jo Goodhew: Yes.

The CHAIRPERSON (Lindsay Tisch): Sorry, I have ruled no objection.

I thank the Committee; I thank the Committee indeed—

💬 Hon Member: There was objection.

Oh, there is objection.

The CHAIRPERSON (Lindsay Tisch): I will put the leave again; my apologies. Leave is sought for the Hon Pete Hodgson to speak briefly on the commencement. Leave is sought for that purpose. Is there any objection? There is objection.

Motion agreed to.

Clause 1 agreed to.

The question was put that the amendments set out on Supplementary Order Paper 83 in the name of the Hon Simon Power to clause 2 be agreed to.

Amendments agreed to.

Clause 2 as amended agreed to.

The Committee divided the bill into the Trade Marks Amendment Bill and the Copyright Amendment Bill (No 2), pursuant to Supplementary Order Paper 85.

Bill reported with amendment.

Report adopted.