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Baroness O'Cathain: This issue has been running and running. I wish to make two points. The National Consumer Council does not seem to have as much concern as the noble Viscount expressed. Indeed, a recent survey by the Consumers' Association confirmed that customers are not confused by look-alikes. I think that we all realise that most customers consider price. Mechanisms are already in place for resolution of the issue. I do not deny that there was a period when this sort of thing occurred. But the industry supports the Standing Advisory Committee on Intellectual Property's contention that the Trade Marks Act 1994 needs time to work. There are mechanisms for the registration of distinctive signs and packaging. Tort provides measures for the passing-off issue.
As I am sure the noble Viscount knows, a strong, informal relationship between manufacturers and retailers has resulted in a code of practice. I believe that the issue should not be dealt with in this Bill. The mechanisms under the Trade Marks Act 1994 should be given time to work.
Lord Borrie: There is no doubt that it is a difficult question. There is the matter of what is fair and unfair competition. For many years as Director General of Fair Trading I laboured under the disadvantage that people would often make complaints to me ending with the
Yet the noble Viscount has a point in pushing the amendment; namely, that if customers are confused between two goods, one produced by one manufacturer, another produced by a different manufacturer, and they are made to look alike in terms of packaging, an anti-competitive practice may arise out of the confusion and certainly a form of conduct that might be regarded as reprehensible.
However, it does not automatically follow that, because goods look fairly alike in the way they are presented by way of their packaging, that is necessarily anti-competitive or even unfair. Many consumers, when searching in the supermarket for a packet of cornflakes or a particular form of liquid, will be looking for a certain type of package, because that is the way in which, over the years, that particular article has been packaged. It is in a bottle of a certain shape, or a certain type of cardboard package, indeed with a certain colour. If any manufacturer were to produce a bottle or package of an entirely different colour, that would not be competitive or very successful.
There are certain cues which a consumer has in his or her mind when shopping which prompt him or her to look for packaging of a certain type. It is what tells a customer that that is the product that he or she seeks. Part of the penalty of success, as in the case of, for instance--if I dare use the name of one manufacturer--Kellogg's is that anybody who wants to produce cornflakes, in order to make any kind of impact on the market, will almost certainly have to produce cornflakes with a package that looks rather like the Kellogg's packet. So there is a certain inevitability in there being a look-alike package. That is the difficulty in the case made by the noble Viscount.
However, I am tempted to say, since the previous speaker quite properly declared an interest as a director of Tesco, that I have examples in front of me of which Tesco ought to be ashamed. The packaging is not merely similar to the packaging of well-known manufacturers but is so incredibly similar that I do not believe it is entirely a matter of chance--or is entirely a matter of "cue", as I mentioned. The noble Baroness said that there may have been a problem in the past, but not at present. I hope that she is right. I hope that the information I have received from the British Brands Group is not entirely up to date and therefore there is no need for any change in the law. In any case, I agree with the noble Baroness that I do not believe that this is the appropriate Bill for the introduction of any such change. The law of trade marks, the law of passing off and so on, is far more appropriate than this particular vehicle.
Lord Graham of Edmonton: As the noble Baroness said, we have discussed this matter before. My noble friend Lord Borrie quoted Kellogg's. This is a cereal that will run, and run, and run! While we do not welcome having to be here at a quarter-past 10 at night, the noble Viscount has done the Committee a service--although I think that going over the top or being too precipitate puts the issue out of court.
We in this House are great believers in taking careful note of committees of some standing and authority. I am told that the Standing Advisory Committee on Intellectual Property recently indicated that in its view it was too early to take a decision on this point--not that there may not be a case or that there are not things which need to be put right. I do not rest on the argument that this may not be the right Bill. If there were a general view that something needed to be done, this would be the right Bill.
I am indebted for background information to the British Retail Consortium, which has a direct link with the All-Party Retail Group, of which my beloved Co-op is a part. It has not advised me directly, but we all have our own experience. I am bound to say that in Edmonton, or in Loughton, where I live, they do not talk of little else but this issue. However, this is undoubtedly an issue to those in the trade who aim to expand their sales and their profits. Whether it is looked upon by the general public with humour, ridicule or interest is a difficult balance.
I understand where the noble Viscount and the organisation to which he referred are coming from. They refer to damage as included in the dilution of good will and reputation which precludes the necessity of demonstrating consumer confusion. I am not at all certain about it. These people firmly believe in fair competition but the nexus that motivates them is the desire to drive their competitors out of business. That is how they become bigger. They are not in the business of retaining what one might call a perfect market; they are in the business of becoming bigger, fatter, more profitable and more loved by the public. Therefore they ought not to be too upset at competition that I would call maybe a little shady, maybe a little on the margin.
We know all about the trademarks legislation in this country. We also know that the design of packaging is already governed by a number of factors to ensure that passing off is very difficult. Standard EC sizes, acceptability, technology, protection, portability, ease of opening and storage all condition what one can and cannot do. With regard to this aspect of competition one needs to look at the register of marks that we already have. The category of unregistered marks has also been raised. I do not believe that there should be no differentiation between the quality or acceptability of goods which are registered and those which are unregistered. If there were no difference, it would prove a disincentive to anybody--manufacturers or producers--to register a trademark. At one time a trademark was a very limited thing, almost a logo. Now there is a range of things which can be included in a trademark.
Lord Fraser of Carmyllie: Perhaps I may make a few remarks in support of the noble Viscount on the clauses he proposes should be added to the Bill. I am bound to say that this is a serious matter and your Lordships' Chamber would not do a great deal of good or enhance its reputation if we were to attempt to conclude discussion on it this evening. If the noble Viscount wishes to return to it at a later stage, I signal to him our support for such an approach.
I shall be interested to hear about one technical matter from the Government Benches. If there is an argument on their part that the inclusion of such clauses within the Bill would be beyond it, it would be helpful to know that now. I shall be surprised if that is the case, given the fact that Amendment No. 270A refers to the action of unfair competition. In such circumstances it ought to be permissible for such clauses to come within the Bill.
All I wish to say at this stage is this. With my noble friend sitting behind me and the noble Lord sitting opposite, I generally agree that the British Retail Consortium provides your Lordships with sensible, helpful briefing. However, on this occasion it does not seem to me to be the most satisfactory briefing that I have ever received from that organisation, for this reason. It seems to me that the BRC is prepared to undertake the risk of confusing the issue of own brands with look-alikes. Nobody would suggest that supermarkets or anyone else should not avail themselves of the opportunity, often if not invariably, of providing own-brand goods at a price cheaper than better known brands--Kellogg's cornflakes or whatever it may be. But I am not prepared to accept that there is no distinction between the issue of own-brand goods and look-alikes.
The noble Lord, Lord Borrie, clearly has in his possession a set of photographs which I too possess. I shall not detain the Committee with them at this stage, but from looking at the photographs, it is not simply a matter of providing the product in the type of packaging which gives the customer a cue to the range of goods within which it is dealing. It is pretty conclusive, even from a superficial examination of the photographs, that the intention must be to try to convey to people that it is the same product. If that is not the intention, then legislation should be put in place to ensure that people are never misled.
With those few remarks, I simply indicate to the noble Viscount that we should leave the matter now. But it is an important issue. It affects some important companies in this country and we should not dismiss their concerns lightly.
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