UK sets out the new Science and Technology Framework

The new Department for Science, Innovation and Technology (DSIT) recently released its Science and Technology Framework, which will act as a "strategic anchor" for government policy aiming to make the UK a science and technology superpower by 2030.

The framework is divided into ten strands. The first sets out five technologies that have been identified as critical to the UK's future growth and will be the focus of strategic advantage building: artificial intelligence (AI), in particular machine learning; engineering biology; future telecommunications; semiconductors; and quantum technologies.

The other nine strands of the framework set out tools that the government can use to support these critical technologies and create an environment for their success; for example, investment in research and development, procurement, and regulation and standards.

While the new framework sets out an ambitious plan for future economic growth driven by science and technology, it is clear that there are legal uncertainties that need to be resolved to materialise the envisaged growth. Although strand nine focuses on regulation and standards, striking the right balance between pro-innovation policy and intellectual property (IP) rights will be crucial in paving the way for long-term economic success.

'Pro-innovation' AI approach

The framework makes it clear that initial work concerning AI will be developing a "pro-innovation" approach to regulation, which includes the newly released and much-anticipated white paper on AI governance.

The Pro-Innovation Regulation of Technologies Review has also been carried out by Sir Patrick Vallance, which was recently released and accepted by the government. The Vallance review acknowledges that there is a need for regulatory certainty to unlock the potential of AI. The government response notes that it will "act at pace" to provide clarity in relation to the application of IP law to the AI sector.

It further sets out that the UK Intellectual Property Office (UKIPO) will produce a code of practice by summer 2023 after meeting with both AI firms and rightsholders. The code of practice will provide guidance to AI firms on accessing IP protected works for AI training purposes while ensuring there are appropriate protections (it gives the example of labelling) on generated output to support rightsholders.

The government response goes even further in stating that AI firms that commit to the code of practice can expect to be offered a "reasonable licence" by rightsholders in return. Although it is intended that the code of practice will be voluntary, the government also cautions that it may be followed up by legislation if the code is not adopted or agreement is not reached.

AI and IP consultation

The Vallance review and the government response follows much toing and froing over whether to expand the copyright exception for text and data mining (TDM), a process of finding patterns and extracting knowledge from data using AI tools.

The present TDM exception is narrow, stating that a person does not infringe copyright in a work if a copy is made by someone who has lawful access to the work and carries out "computational analysis" for the "sole purpose of research for a non-commercial purpose".

However, after consultation, the government stated that it planned to introduce a more expansive TDM exception covering both copyright and database rights that would allow TDM for any purpose, provided that the works were lawfully accessed. It also noted that there would be no option for rightsholders to opt out of this exception nor would they be able to charge for licences for TDM.

The government later backtracked on introducing this new expansive exception and now seems to be trying to establish a voluntary reasonable licensing ecosystem. However, it remains to be seen whether rightsholders will accept this approach and if there can be agreement as to what a reasonable licence might look like. The government may decide to take a stricter, pro-AI development legislative approach if agreement and uptake is not forthcoming, but the shadows of the previous abandoned policy ideas and their opposition might loom large.

Future telecommunications

The focus of the framework on future telecommunications will be on the evolution of infrastructure for digitised data and communications.

The framework states that some of the government's initial work in this area will be working with global standards development organisations (SDOs), including the United Nation's International Telecommunication Union, ISO/IEC (the International Organization for Standardization/the International Electrotechnical Commission), the European Telecommunications Standards Institute (ETSI) and the Internet Engineering Task Force, to "ensure that the standards underpinning our critical technologies reflect our UK values".

The inclusion of ETSI in this list is notable given the proliferation of global FRAND (fair, reasonable and non-discriminatory) licensing disputes in the English courts (and elsewhere) concerning patents declared essential to ESTI standards (SEPs).

Mandatory arbitration?

The UKIPO also opened a consultation concerning SEPs and innovation at the end of 2021. In the response to the consultation the legal framework concerning SEPs, licensing and litigation was specifically addressed. It noted that there has been "considerable industry and sector interest" in the role of national courts setting global FRAND licensing rates, which the English courts have been prepared to do. However, it also stated that "reliance on courts to resolve such disputes can be inefficient and costly for users of technologies in which SEPs are embedded".

It then went on to suggest that the government would seek views on how best to "encourage and promote greater use of arbitration" and whether there should be government intervention. This comes after mandatory arbitration proposals were made by Lord Justice Arnold , an experienced IP judge.

ETSI's inclusion of an arbitration clause in its IP rights policy was rejected by participants in the early 1990s. However, the government's ambitions to work with SDOs such as ETSI could mean that it seeks to put arbitration back on the agenda for ETSI and other similar organisations.

Whether that would be successful is another question, especially since ETSI operates on a "consensus basis" and there are very polarised views by participants on this issue, so it would appear difficult to reach a consensus. Further, the number of national courts willing to set global rates in FRAND disputes is expanding; for example, China confirmed its ability to set global FRAND terms in the Supreme People's Court decision in Sharp v Oppo.

Too much work, too little time?

The framework represents an ambitious programme of work, particularly considering the work currently underway at the UKIPO (and other departments) in relation to the proposed Retained EU Law (REUL) Bill, which potentially automatically revokes vast swathes of EU-derived law at the end of 2023.

The UKIPO has been carrying out a review of legislation to determine what is potentially considered to be EU-derived law in the IP context and what might be affected by the REUL Bill. This steadily increasing list is currently at 82 pieces of legislation.

The extent of the challenge posed by the REUL Bill cannot be understated and it has already caused the UKIPO to slow down work on other workstreams, such as the ongoing design-law consultation. Quite how progress on meeting the deadlines identified in this ambitious new framework will be affected by the ongoing review task necessitated by the REUL Bill is unclear.

Revolving door of IP ministers

Alongside the various consultations and policy direction changes at the UKIPO, there have been a number of changes in the minister responsible for IP and departmental reshuffles in government.

The IP brief now sits within the new DSIT and Viscount Camrose, a hereditary peer who joined the House of Lords in 2022 and whose background is not well documented, has recently been appointed to the new joint brief of minister for AI and intellectual property. Viscount Camrose is the 13th appointment with responsibility for IP since 2010, which might give some insight into changing policy positions.

The joining together of the AI and IP briefs is an interesting move given the tensions between accessing data for AI training on the one hand and IP rights potentially limiting such a use on the other. It seemingly underscores the need to provide legislative clarity on this increasingly important issue.

Osborne Clarke comment

The government's new framework sets out an ambitious plan to set the UK on the path of becoming a science and technology superpower by 2030. Although the framework sets out a well-defined focus on five critical technologies, the other nine strands are broad and cover wide-ranging tasks. In order for strategic gains to be made with respect to the five critical technologies, legal clarity is needed, particularly with respect to the interface of technological advancement and IP rights.

The UKIPO has already undertaken work in the areas of AI and future telecommunications but clarity is still needed. The scope of the task of developing a coherent legislative position that is both pro-innovation and protects IP rightsholders and the UK's position as a strong and sophisticated IP jurisdiction should not be underestimated.

The scope of the work being asked of departments such as the UKIPO is vast, particularly in the context of the ongoing task of the REUL Bill legislative review that needs to be undertaken by the end of the year. It is not clear that there is a sufficient amount of personnel to carry the proposed policy agenda, particularly given that the UKIPO has already had to slow down work on ongoing consultative activities. The framework promises that DSIT will publish an update setting out the progress that has been made by the end of 2023. This should give a better indication of how quickly or not things are progressing.