INTELLECTUAL PROPERTY, BIOGENETIC RESOURCES AND TRADITIONAL KNOWLEDGE
Graham Dutfield
London • Sterling, VA
First published by Earthscan in the UK and USA in 2004 Copyright © Graham Dutfield, 2004 All rights reserved ISBN:
1-84407-049-2 paperback 1-84407-048-4 hardback
Typesetting by MapSet Ltd, Gateshead, UK Printed and bound in the UK by CPI Bath Cover design by Susanne Harris For a full list of publications please contact: Earthscan 8–12 Camden High Street Tel: +44 (0)20 7387 8558 Fax: +44 (0)20 387 8998 Email:
[email protected] Web: www.earthscan.co.uk 22883 Quicksilver Drive, Sterling, VA 20166-2012, USA Earthscan publishes in association with WWF-UK and the International Institute for Environment and Development A catalogue record for this book is available from the British Library Library of Congress Cataloging-in-Publication Data Dutfield, Graham. Intellectual Property, biogenetic resources and traditional knowledge / by Graham Dutfield. p. cm. Includes bibliographical references (p. ). ISBN 1-84407-049-2 (pbk.) – ISBN 1-84407-048-4 (hardback) 1. Germplasm resources, Plant. 2. Ethnoscience. 3. Intellectual property. I. Title. SB123.3.D879 2004 333.95'34–dc22 2004004914 This book is printed on elemental chlorine-free paper
CONTENTS
List of Tables and Boxes Preface List of Acronyms and Abbreviations
vii viii xi
PART 1 KNOWLEDGE, PROPERTY AND TRADE 1
Sovereignty, Common Heritage and Property Rights Permanent sovereignty Common heritage Intellectual property rights
2
Biotechnology and the Expanding Boundaries of Intellectual Property Protection Biotechnology and the life science industries The commercial importance of biogenetic resources and traditional knowledge Intellectual property in the life sciences
3
The International Law of Biogenetic Resources and Intellectual Property The TRIPS Agreement The UPOV Convention The Convention on Biological Diversity The International Treaty on Plant Genetic Resources for Food and Agriculture
3 5 10 11 14 14 18 20 25 25 33 37 39
PART 2 CONFLICTS AND CONTROVERSIES 4
National Sovereignty, Benefit Sharing and the Patenting of Life Fair and equitable Patenting natural products Patent quality problems
45 45 48 49
iv Intellectual Property Rights, Biogenetic Resources and Traditional Knowledge 5
Biopiracy The hoodia case The neem patents The quinoa case The enola bean case ‘Biopiracy’ through plant variety protection Rights and wrongs
52 52 53 53 54 55 56
6
Environmental Impacts Intellectual property rights and monocultures Plant variety protection and genetic uniformity Intellectual property rights and crop-agrochemical linkages
60 60 61 62
7
Agriculture, Food Security and Nutrition Plant variety protection and research priorities Plant variety protection and the interests of poor farmers Intellectual property rights and the availability of genetic resources for breeding Empirical evidence Alternatives to UPOV
66 66 67
8
9
Beyond Intellectual Property: Technology Protection Systems High stakes Pros and cons Terminator and the patent system Life Science Innovation, Biotechnology Transfer and Developing Countries The importance of life science innovation in trade and development Technology transfer
68 69 70 74 76 77 78 80 80 82
PART 3 PROTECTING TRADITIONAL KNOWLEDGE 10
11
Traditional Knowledge and the Intellectual Property System The nature of traditional knowledge Why protect traditional knowledge? Can intellectual property rights protect traditional knowledge?
100
Alternative Approaches to Traditional Knowledge Protection Defensive protection Positive protection Strategic considerations
110 110 117 122
91 91 97
Contents v
PART 4 FORUMS, PROCESSES AND INITIATIVES 12
13
International Forums and Processes The World Trade Organization The World Intellectual Property Organization The Conference of the Parties to the Convention on Biological Diversity
127 127 131
Government and Regional Initiatives Philippines Executive Order 247 and its Implementing Rules and Regulations Andean Community Common Regime on Access to Genetic Resources The Costa Rica Biodiversity Law The African Model Legislation for the Protection of the Rights of Local Communities, Farmers and Breeders, and for the Regulation of Access to Biological Resources Analysis
138
136
138 143 148 153 159
PART 5 NATIONAL CASE STUDIES 14
India Introduction Biodiversity: conservation, trade and development India’s bio-scientific and technological capacities: an assessment Implementing TRIPS: current progress TRIPS and the national bio-industries: threat or opportunity? Conclusions
165 165 166 174 186 190 201
15
Kenya Introduction Biodiversity: conservation, trade and development Kenya’s scientific and technological capacities: an assessment Implementing TRIPS: current progress TRIPS, UPOV and the national bio-industries: threat or opportunity? Conclusions
204 204 204
Lessons from the Case Studies Introduction Plant variety protection Patents and agro-biotechnology Patents and the health sector Intellectual property rights and traditional knowledge Intellectual property rights, value addition and conservation
219 219 219 220 220 220 221
16
208 212 214 217
vi Intellectual Property Rights, Biogenetic Resources and Traditional Knowledge Notes References Index
222 235 252
LIST OF TABLES AND BOXES
TABLES 6.1 10.1 14.1 14.2 14.3 14.4 14.5 15.1
Addressing causes of biodiversity losses linked to agriculture Reasons to protect traditional knowledge Documentation of biological diversity in India Export performance trends for agricultural and processed food products, 1996–1999 Export of crude drugs and essential oils from India, 1985–1995 Selected biotech products and processes in India Total number of practices from Gujarat documented by SRISTI – Honey Bee Network Percentage contribution of major agricultural products and manufactured goods to Kenya’s total export value, 1990 and 1995
64 100 167 171 172 176 181 207
BOXES 1.1 The Consultative Group on International Agricultural Research 10.1 Some copyright cases in Australia involving Aboriginal artworks 10.2 Could basmati rice be protected by a geographical indication?
8 102 108
PREFACE
According to the Devil in George Bernard Shaw’s Man and Superman, ‘[I]n the arts of life man invents nothing; but in the arts of death he outdoes Nature herself, and produces by chemistry and machinery all the slaughter of the plague, pestilence and famine.’ Such a dark vision of human nature seems to sum up the views of many people who oppose the patenting of life-forms, genetic modification and industrial agriculture, except that the blame is more likely to be ascribed to industrial capitalism than the shortcomings inherent to human beings. This becomes evident when the same people extol the virtues of indigenous peoples and others who, in the language of the Convention on Biological Diversity (CBD), ‘embody traditional lifestyles’ for having a more environmentally friendly lifestyle than the rest of us, and for giving so much to the fount of human knowledge without getting a cent in return. At the other extreme we have the ‘techno-optimists’ who have a much stronger faith in our inherent creativity to improve on what we have inherited from nature and from past generations of humans. The purpose of this book is not to persuade readers that one or the other view is the one that should be held. As a practical guide to the issues, it treats the world as it is – not out of any conviction that what we have is either the best or the worst of possible worlds, but because the subject of the book is essentially descriptive and analytical in nature as opposed to prescriptive. Its subject matter is the law and regulation of intellectual property rights (IPRs), biogenetic resources and traditional knowledge, which it aims to make as clear and understandable as possible to readers who are not assumed to be experts. It does not go out of its way to praise or condemn the various elements of the relevant legal and regulatory norms and institutions currently in force or under development, though it may well provide useful ammunition for both critics and supporters. But it is not impartial either, since the analyses contained in the book are, in part, based on the view that one of the key criteria for effective law and policy-making in this area as in others, in addition to efficiency, is fairness. This book consists of five parts. Part 1, entitled Knowledge, Property and Trade, has two goals. The first is to clarify the economic importance of industries that use biogenetic resources and traditional knowledge (TK) as both tangible and intangible ‘raw materials’, the extent to which they are dependent upon them, and the way that modern intellectual property (IP) law has evolved to meet their needs. The second goal is to describe the relevant international law.
Preface ix
In view of the importance of IPRs in international trade, the role of transnational corporations in the negotiating history of the World Trade Organization’s Agreement on Trade-related Aspects of Intellectual Property Rights (the TRIPS Agreement), and the specific requirements it contains, it should surprise nobody that certain aspects of IPRs have attracted a great deal of debate. The extension of the scope of patent rights to cover life-forms, for example, has aroused strong feelings among those who argue that it is immoral or unethical to ‘own life’. These sentiments are expressed by people not just in developed countries where ‘patenting life’ is already quite common, but also in those developing countries where such patents are not yet allowed but will be in the next few years. Equally strong sentiments are expressed by representatives of the life science firms who argue that such patents are essential to generate innovation in highly expensive and risky fields of scientific research. But, as Part 2 of the book shows, this is not the only reason why intellectual property protection in the area of life science innovations and biogenetic resources has given rise to controversies. The first of these controversies to be discussed in Part 2 concerns the alleged conflicts between the patenting of natural products and life-forms and the principles and objectives of the CBD, especially the sovereign rights of countries over their biological resources, and the requirement that benefits from the commercialization of genetic resources should be shared in a fair and equitable manner. This matter is shrouded in polemics to the extent that it is sometimes difficult to be sure where exactly the truth lies. Chapter 4 attempts to make the situation clearer to the reader. The second controversy is that of ‘biopiracy’, or the unauthorized commercial exploitation and monopolization of TK and genetic resources, which is covered in Chapter 5. Some critics argue that the IP system encourages and legitimizes the misappropriation of the knowledge, innovations and practices of indigenous peoples and local communities. Third, it is sometimes claimed that there may be a link between the availability and adoption of patent or plant variety protection (PVP) and the replacement in many areas of the world of complex, diverse agro-ecosystems containing a wide range of traditional crop varieties with monocultures of single genetically uniform, agrochemical-dependent varieties. The merits of such assertions are considered in Chapter 6. Related to this is a fourth controversy, which is that the IP rules may have dire implications for food security, as discussed in Chapter 7. Some nongovernmental organizations (NGOs) argue that IPRs may undermine food security and nutrition in three ways. The first is by encouraging the cultivation of a narrow range of genetically uniform crops including non-food cash crops, with the possible consequences that people’s diets will become nutritionally poorer and crops will be more vulnerable to outbreaks of devastating diseases. The second is by limiting the freedom of farmers to acquire the seeds they wish to plant without payment to breeders, and thereby impoverishing them further. The third is by restricting the free circulation of plant genetic resources, which is generally considered essential for the development of new plant varieties.
x Intellectual Property Rights, Biogenetic Resources and Traditional Knowledge A fifth controversy concerns the development of technological protection systems that seek to prevent the re-use of IPR-protected seed and thereby strengthen and even extend the monopoly provided by the law through patents and PVP. The best known of these is the so-called ‘terminator technology’ discussed in Chapter 8. A sixth controversy, which is not restricted to biotechnology and the life sciences, surrounds the issue of how IP protection impacts on innovation and the dissemination of new technologies to, and also within, the developing countries. While IPRs have the potential to foster innovation and encourage technology transfer – and in fact these have historically been among their raisons d’être – many critics are doubtful whether the current international standards of IP protection can enable countries which lack the capacity to undertake independent research into life sciences and biotechnology to become more innovative. In addition, IPRs have been criticized for blocking the transfer of technologies – including biological ones – to developing countries, or at least to institutions and businesses in those countries that are not domestic affiliates of transnational corporations. Part 3 focuses on TK protection. Chapter 10 seeks to clarify what is meant by the term ‘traditional knowledge’. It then goes on to consider the reasons why TK should be protected, as well as the applicability of IP protection. Chapter 11 presents some proposed measures for making up for the inadequacies of the present intellectual property rules in respect of TK protection, both through reforms of the present IP system and through completely new types of measure. As the chapter shows, legal solutions to the protection of TK may be sought in terms of either ‘positive protection’ or ‘defensive protection’. To many countries and NGOs, defensive protection is necessary because the IP system, and especially the patent regime, is considered defective in certain ways and allows companies to unfairly exploit TK. It may also be true that defensive protection may be more achievable than positive protection in the real world. This is because some of the most commonly discussed defensive protection measures are basically enhancements to or modifications of existing IPRs. Effective positive protection is likely to require a completely new system whose development will require the very active and committed participation of many governments. Part 4 covers international, regional and national negotiations, policymaking and legislation dealing with the relevant international instruments, which is dealt with in Chapter 12, and the relevant initiatives of national governments operating alone or with neighbouring countries, as examined in Chapter 13. Finally, Part 5 focuses on two developing countries rich in biogenetic diversity – India and Kenya. The purpose of this part is to find out how far such countries – taking into account the international rules as they currently exist and their freedoms as sovereign states to pursue their own economic interests – may harness their natural endowments to develop their economies, and whether success will encourage the conservation and sustainable use of the resource base.
LIST OF ACRONYMS AND ABBREVIATIONS
ABS AICRPE AIPPI
access and benefit sharing All India Coordinated Research Project on Ethnobiology Association Internationale pour la Protection de la Propriété Industrielle (International Association for the Protection of Industrial Property) ARA Academic Research Agreement (Costa Rica) ARIPO African Regional Industrial Property Organization ASSINSEL Association Internationale des Selectionneurs pour la Protection des Obtentions Végétales (International Association of Plant Breeders) CBD Convention on Biological Diversity cDNA complementary DNA CEFIC European Chemical Industry Council CGRFA Commission on Genetic Resources for Food and Agriculture (FAO) CGIAR Consultative Group on International Agricultural Research CIAT International Center for Tropical Agriculture CIPR Commission on Intellectual Property Rights CIP International Potato Center CLR compensatory liability regime CONAGEBIO National Biodiversity Management Commission (Costa Rica) COP Conference of the Parties to the Convention on Biological Diversity CPGR Commission on Plant Genetic Resources (FAO) CRA Commercial Research Agreement (Costa Rica) CSIR Council for Scientific and Industrial Research (South Africa) CTE Committee on Trade and Environment DBF dedicated biotechnology firm DENR Department of Environment and Natural Resources (Costa Rica) DOST Department of Science and Technology (Costa Rica) EMRs exclusive marketing rights EPC European Patent Convention EPO European Patent Office ETC Group Action Group on Erosion, Technology and Concentration (formerly RAFI) EU European Union FAO Food and Agriculture Organization of the United Nations FDA Food and Drug Administration FDI foreign direct investment
xii Intellectual Property Rights, Biogenetic Resources and Traditional Knowledge GATT GBK GBS GIs GIAN GIPID GM GURTs HYVs IACBGR IARC ICC ICIPE ICNCP IGC INDECOPI IP IPGRI IPR ISAAA IUCN IUCN-ORMA IUPGR KARI KEFRI KEMFRI KEMRI KETRI KIPO KWS MEAs MoEF MTA NBA NBSAP NCEs NEMA NGO NIF NMK
General Agreement on Tariffs and Trade Gene Bank of Kenya Global Biocollecting Society geographical indications Gujarat Grassroots Innovations Augmentation Network Global Intellectual Property Issues Division (WIPO) genetically modified genetic use restriction technologies high yielding varieties Inter-Agency Committee on Biological and Genetic Resources (Philippines) International Agricultural Research Centre International Chamber of Commerce International Centre for Research in Insect Physiology and Ecology International Commission for the Nomenclature of Cultivated Plants Intergovernmental Committee on Intellectual Property and Genetic Resources, Traditional Knowledge and Folklore (WIPO) National Institute for the Defence of Competition and Intellectual Property (Peru) intellectual property International Plant Genetic Resources Institute intellectual property right International Service for the Acquisition of Agri-biotech Applications International Union for the Conservation of Nature and Natural Resources (World Conservation Union) IUCN’s Regional Office for Mesoamerica International Undertaking on Plant Genetic Resources Kenya Agricultural Research Institute Kenya Forestry Research Institute Kenya Marine and Fisheries Research Institute Kenya Medical Research Institute Kenya Trypanosomiasis Institute Kenya Industrial Property Office Kenya Wildlife Service multilateral environmental agreements Ministry of Environment and Forests (India) material transfer agreement National Biodiversity Authority (India) National Biodiversity Strategy and Action Plan (India) new chemical entities National Environment Management Authority (Kenya) non-governmental organization National Innovation Foundation (of India) National Museums of Kenya
List of Acronyms and Abbreviations xiii OAU OAU/STRC ORMA PBRO PBRs PGRWG PIC PLT PO PRDC PROMUDEH PTO PVP R&D RAFI rDNA S&T SBSTTA SCP SETAI SINAC SPDA SRISTI TBGRI TCM TK TKDL TNC TRIPS UCSF UNCTAD UNESCO UPOV USDA USTR VCU WIMSA WIPO WTO WWF
Organization of African Unity Scientific, Technical and Research Commission of the OAU Regional Office for Mesoamerica (IUCN) Plant Breeders’ Rights Office (Kenya) plant breeders’ rights Plant Genetic Resources Working Group (Kenya) prior informed consent Patent Law Treaty People’s Organization Pharmaceutical Research and Development Committee (India) Ministry for Promotion of Women and Human Development (Peru) Patent and Trademark Office (US) plant variety protection research and development Rural Advancement Foundation International (renamed ETC Group) recombinant DNA science and technology Subsidiary Body on Scientific, Technical and Technological Advice (CBD) Standing Committee on the Law of Patents (WIPO) Technical Secretariat of Indigenous Affairs (Peru) National System of Conservation Areas (Costa Rica) Peruvian Society of Environmental Law Society for Research and Initiatives for Sustainable Technologies and Institutions Tropical Botanic Garden and Research Institute Traditional Chinese Medicine traditional knowledge Traditional Knowledge Digital Library (India) transnational corporation Agreement on Trade-related Aspects of Intellectual Property Rights University of California at San Francisco United Nations Conference on Trade and Development United Nations Educational, Social and Cultural Organization Union Internationale pour la Protection des Obtentions Végétales (International Union for the Protection of New Varieties of Plants) United States Department of Agriculture United States Trade Representative value for cultivation and use Working Group on Indigenous Minorities in Southern Africa World Intellectual Property Organization World Trade Organization World Wide Fund For Nature
Part 1
KNOWLEDGE, PROPERTY AND TRADE
Chapter 1 SOVEREIGNTY, COMMON HERITAGE AND PROPERTY RIGHTS
This book is about the relationships between intellectual property (IP), biochemical and genetic resources (‘biogenetic resources’ for short – both as they exist in nature and in the form of commercial products) – and knowledge relating to practical applications of these resources, including traditional knowledge (TK). These relationships are not new. Consider the patenting of natural substances: Louis Pasteur patented a culture of yeast cells in 1873; adrenaline and insulin were patented in the early 20th century. While there has been a general assumption that living things cannot be patented, patents were occasionally granted in some countries on plants and micro-organisms. The US even had a plant patent system from as early as 1930. As for TK, a frequently quoted estimate is that, of the 119 plant-based compounds used in modern medicine, 74 per cent had the same or related uses as the medicinal plants from which they were derived (Farnsworth, 1988). What is new is, first, that the relationships have become politicized. As soon as the disappearance of these resources became apparent and their perceived economic value increased, the uncertain legal situation became a source of conflict between and within nations on matters relating to conservation, commercialization and ownership. Governments differed with other governments about how the world’s biogenetic resources should be regulated, while political activists and civil society organizations denounced (as they continue to do) the behaviour of businesses, public sector institutions or governments seeking to appropriate these resources in ways they consider to be unfair, immoral or illegal. Second, and largely in response to this politicization, there is a growing body of international law that seeks to clarify the legal uncertainties, but that in practice only seems to exacerbate them. Three important international agreements have resulted from the new biogenetic resource politics, which dates back to the late 1970s. These are the 1983 International Undertaking on Plant Genetic Resources, which will be superseded by the International Treaty on Plant Genetic Resources for Food and Agriculture, and the 1992 Convention on Biological Diversity (CBD). A fourth agreement, which is perhaps the most important of all these in terms of
4 Knowledge, Property and Trade economic stakes and human welfare, is the 1994 Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS), which is administered by the Geneva-based World Trade Organization (WTO). The politicization of these relationships and the rapid evolution of international law in this field are ultimately related to the fact that the variety of biogenetic resources existing in the world is apparently being rapidly eroded. Concerns about genetic erosion are not new, dating back to the 1930s in the US, but the issue was for many years of little interest to anybody other than a few scientists and officials. This situation changed drastically in the early 1980s when the politicization of genetic erosion was achieved by just a few activists and international bureaucrats, transforming an obscure topic into a matter for high level diplomacy and political activity. In the early 1980s, Cary Fowler and Pat Mooney – two North American political activists who were among the first to denounce the extension of intellectual property rights (IPRs) to life-forms in the US and internationally – identified the Food and Agriculture Organization of the United Nations (FAO) as the most promising arena for their campaigning. Mooney had already become well known by writing a controversial book called Seeds of the Earth (published in 1979) that took a critical stance on IPRs. In hindsight, it seems reasonable to characterize the book as the first shot across the bows in what became known as ‘the Seed Wars’, for which the FAO constituted the principal battleground. The main source of dispute was the alleged abuse of the free exchange principle by developed countries and their firms. Developing countries became convinced of two things: first, that most of the world’s base crop collections were held in the developed world even though most of the accessions had come from the developing world; and, second, that while traditional cultivars and other genetic resources were treated as being the common heritage of mankind, plant breeders in the developed countries were securing IP protection for their own varieties. Initially, somewhat separate from these developments, the 1990s saw the emergence of an international consensus among scientists and policy-makers that ‘biological diversity’ was facing its greatest crisis for 65 million years. ‘Biological diversity’ and the contracted form of the term, ‘biodiversity’, were coined in the early 1980s at a time when several prominent biologists were calling attention to the dangers of an anthropogenic ‘extinction spasm’.1 The motive was not so much to contribute to science per se as to pursue a conservationist agenda. However, the scientists and conservation organizations that became involved discovered that pursuit of their agenda meant walking into a political minefield. Within a few years, conservation of biological diversity became a subject of heated debate, pitting the developing countries against developed countries, and indigenous peoples and their supporters against governments and big business. There are a number of explanations for this. The most telling explanation relates to the fact that, as the world was becoming more biologically uniform, rapid advances in the applied life sciences, and especially in the new biotechnologies, led people to assume that undiscovered biogenetic resources in the richly endowed developing world had
Sovereignty, Common Heritage and Property Rights 5
massive economic potential.2 Yet despite this, there was a huge disparity in the way the commercial benefits from industrial use of these resources were distributed, with the lion’s share going to large corporations in the developed world. Resentment about this situation made developing countries resistant to pressure from the rich countries to conserve their biological diversity at their own expense for the enrichment, as they perceived it, of these corporations.3 It also directed attention to modern intellectual property (IP) law, especially patents and (albeit to a lesser extent) plant variety protection (PVP), in the skewed distribution of benefits arising from commercialization of biogenetic resources. Central to these disputes have been sharp differences about which of three property-related regimes should apply to naturally occurring and human modified biochemicals and genetic materials, and how far these regimes are compatible with each other. These regimes are: permanent sovereignty; the common heritage of mankind; and intellectual property. The intensity of the debate over which regime should prevail can largely be explained by the size of the economic stakes involved. Unfortunately, it often appears to have much less to do with concern that the health of the planet and the future of humanity might well depend on an effective stewardship of the world’s biological wealth that is presently lacking.
PERMANENT SOVEREIGNTY It is a fundamental principle of international law, and of the nation state system, which is considered to date back to 16th century Europe, that sovereign countries are ‘territorial polities’ that are: legally equal, differing in capabilities … but with the same standing in international society, which means that the norm of non-intervention is central – no sovereign has the right to intervene in the affairs of another’ (Brown, 2002, p35). It follows from this that independent states have a right to permanent sovereignty over their territories including the natural resources existing within them. The United Nations General Assembly confirmed this in 1962 by adopting Resolution 1803 on Permanent Sovereignty over Natural Resources. The CBD quite explicitly upholds this principle, affirming in the preamble that ‘states have sovereign rights over their own biological resources’. This is not an absolute right, as the CBD acknowledges when it clarifies that ‘the conservation of biological diversity is a common concern of humankind’, and also that ‘states are responsible for conserving their biological diversity and for using their biological resources in a sustainable manner’. Preference for ‘sovereignty’ (accompanied by ‘common concern’) over the alternative of ‘common heritage’ followed some difficult negotiations, pitting negotiators representing governments from the industrialized world against those of biodiversity-rich developing countries. Some developing countries felt
6 Knowledge, Property and Trade resentful that influential conservation organizations and developed country governments were expecting them to protect their forests at their expense and forgo the economic benefits from selling timber or converting them to other uses. Realizing the potential economic value of their biogenetic resources and needing to improve their scientific, technological and financial capacities to exploit them, they asserted their sovereign right to control their resources and demand benefits such as technology transfers in return for the granting of access to them. Consequently, many developing countries have enacted access and benefit sharing (ABS) regimes, making access to their resources and commercial use of them subject to certain conditions. On the other hand, developed countries and transnational corporations wanted as few restrictions as possible on access to biogenetic resources and preferred that transactions with resource providers should be made as simple as possible. While accepting that they could no longer acquire resources as cheaply as before,4 many businesses concluded that bioprospecting contracts were preferable to access regulations since they do not involve bureaucracy, are more flexible and, in theory, keep transaction costs low. Adoption of the sovereignty principle in the CBD was a clear victory for the developing country negotiators. Whether or not it was a victory for developing country interests is less obvious though. In theory, treating biogenetic resources as state property to be administered by governments would lead to their more efficient utilization. It would do this by facilitating bargaining between suppliers (ie, national governments) and users (presumably companies) that would result in developing countries capturing a greater share of benefits. Consequently there would be stronger incentives to conserve and sustainably exploit the resource base since the increased benefits would help meet the opportunity costs of conserving species and biodiverse ecosystems while securing long-term benefits from their industrial application. Demsetz (1967) argued that property rights are created when, as a result of changes in relative prices or technology, it becomes more beneficial to establish and enforce them in spite of the costs of doing so than continuing without them. The assertion of national sovereignty over genetic resources may well be a case in point since this coincided with increases in their value as a result of biotechnological advances in industrialized countries. The Demsetzian approach suggests that the international community’s agreement to uphold national sovereignty rights is a predictable response to this increased value and perhaps also a recognition of the threat to the resource base. However, if we first consider the case of plant genetic resources for food and agriculture, the bargaining position of individual developing countries is weak for five main reasons. First, they tend to lack the scientific and technological capacity to capture the benefits from agro-biodiversity themselves. Second, apportioning the benefits fairly may be impossible or unfeasible. New plant varieties are often the product of generations of breeding and cross breeding, which in turn are the result of selection and breeding by farmers throughout the world and of the evolution of non-domesticated varieties. Since a new variety may descend from dozens of varieties from many dispersed locations, compensating all
Sovereignty, Common Heritage and Property Rights 7
provider countries and/or communities will involve high transaction costs, and the share of benefits to each recipient is likely to be modest. Third, countries are interdependent and not even biodiversity-rich tropical developing countries are self-sufficient. Every country is ultimately dependent upon exotic (that is, non-indigenous) germplasm5 in such forms as wild crop progenitors, semi-domesticated crop relatives, landraces and cultivated varieties (cultivars), and therefore benefit from free access to germplasm collected previously in other countries. To give just one example, when Brazil started to breed soybeans, the country imported germplasm from the US. Interestingly, the origin of soybean is not North America at all, but East Asia. Despite this interdependence, it is ironic that during the 1990s, the extent of plant germplasm collecting activities was reduced due, in no small part apparently, to concerns by some countries about ‘biopiracy’ (Fowler, 2002). Fourth, a great deal of germplasm is stored in ex situ collections, such as those at universities, botanic gardens and the Consultative Group on International Agricultural Research (CGIAR) system genebanks held at the various International Agricultural Research Centres (IARCs). It is to the professional plant breeder’s advantage to acquire genetic material from these sources for three reasons: first, because the collections are extensive and freely accessible; second, because basic information on accessions is usually available; and third because, in many cases, CGIAR breeding programmes have already selected some of the material for its desirable characteristics (see Box 1.1, which describes the CGIAR system). Finally, temperate zone countries may lack the species richness of tropical countries yet may still be well-endowed in terms of crop genetic diversity. The concentration of the world’s biodiversity richness in the tropical zone may not necessarily coincide with the geography of agro-biodiversity richness, especially of the major food crops. Temperate developed countries that have cultivated certain crops for centuries may be well-endowed in balanced genetic structures, genes and traits that are desirable for crop breeders, and developing countries often need to import crop germplasm from these countries for this reason. Strong evidence suggests, then, that if a developing country establishes a strong regulatory regime for access to crop germplasm, industrialized-world crop breeders would be affected far less than breeders in the South that might wish to exchange germplasm with countries sharing the same agro-climatic conditions. The bargaining opportunities for biodiversity-rich developing countries in the field of biogenetic resources for the pharmaceutical industry are slightly more promising in two senses. First, a new pharmaceutical is likely to be derived from a single active principle isolated from a particular species or at least a mixture of a small number of plants. So there would probably be fewer benefit claimants. Second, international transfers of biogenetic resources are more likely to flow in a general South to North direction for this industry than in the more complex crop germplasm situation. This suggests that there is a lower degree of interdependence between countries than for the supply of suitable crop germplasm.
8 Knowledge, Property and Trade
BOX 1.1 THE CONSULTATIVE GROUP ON INTERNATIONAL AGRICULTURAL RESEARCH (CGIAR) The Consultative Group on International Agricultural Research (CGIAR) is an informal association founded in 1971, whose mission is to contribute to food security and poverty eradication in developing countries through research, partnerships, capacity building, and policy support, promoting sustainable agricultural development based on the environmentally sound management of natural resources. The CGIAR’s membership consists of 46 countries (of which 24 are developing countries), four private foundations,6 and 13 regional and international organizations, and is sponsored by the FAO, the International Fund for Agricultural Development, the United Nations Development Programme (UNDP) and the World Bank. The CGIAR supports an international network of 16 international agricultural research centres (IARCs), which include the International Plant Genetic Resources Institute (IPGRI, based in Rome), the International Rice Research Institute (IRRI, based in the Philippines), the International Maize and Wheat Improvement Center (CIMMYT, based in Mexico), and the International Center for Tropical Agriculture (CIAT, based in Colombia). Of these centres 11 together hold the world’s largest ex situ collections of plant genetic resources, with over 700,000 accessions of crop, forage, and agroforestry species, encompassing farmers’ varieties, improved varieties and wild relative species. Of these, 533,000 are held under the auspices of the FAO ‘in trust for the benefit of the international community, in particular the developing countries’. These are treated as public goods and as such are made freely available to researchers anywhere in the world subject to a standard material transfer agreement on the understanding that no intellectual property protection may be sought on the material received from the IARC ‘or related information’.
Nevertheless, there are three reasons why substantial benefits are unlikely to be captured at present by developing countries, especially if their ambitions are limited to exporting unscreened biogenetic material. First, as with crop breeding, many developing countries lack scientific and technological capacity to identify and capture the full potential economic benefits possible from industrial pharmaceutical research and development (R&D) based upon natural products. Second, natural-product pharmaceutical research is one of many competing approaches to drug development. Although many pharmaceutical companies invest in natural-product research, such an approach competes with others such as combinatorial chemistry, rational drug design, genomics,7 proteomics8 and RNA interference.9 Moreover, many of these firms maintain large ‘compound libraries’ and often see no reason to prospect for more compounds. Nevertheless, as long as it remains extremely difficult for therapeutic molecules to be designed and manufactured from scratch without using existing chemical structures as initial leads, many firms will continue to
Sovereignty, Common Heritage and Property Rights 9
screen natural compounds. Even the new combinatorial chemistry techniques need to work on existing lead structures, which will originate from natural or mineral sources, to generate the large compound libraries firms use in their screening programmes (ten Kate and Laird, 1999, pp50, 57). So, combinatorial chemistry does not necessarily conflict with natural product research. Even so, if developing countries raise the price of accessing and using biogenetic material, one can expect that other approaches will become comparatively more cost-effective and will be emphasized more in consequence. Third, the bargaining position of individual countries is likely to be much weaker if valuable compounds are ubiquitous. In a large number of cases, the same pharmacologically active compounds exist in several countries. Intercountry competition will reduce the bargaining power of individual countries. And if countries collaborate to fix prices, it may become more cost-effective for corporations to synthesize compounds instead. One commentator has argued that because individual developing countries will always lack sufficient bargaining power to benefit from bioprospecting if they act alone, they would do better to pool their sovereignty and form genetic resource supply cartels. These cartels, as described by Vogel (1997a), would include all countries possessing an identical resource. There would be a fixed royalty rate of 15 per cent of sales of products derived from the resource. This amount would be shared among the countries concerned. An additional small percentage (Vogel suggests 2 per cent) would go to the actual supplier country. While the royalty rate seems high, Vogel believes that such countries have little to lose given the paucity of benefits they currently receive from existing arrangements. In any case, the cartels could still decide to lower royalty rates in the future. There is of course a danger that cartels might have so many members that the benefits going to each one, even at such a high royalty rate, would be very low. One way to improve Vogel’s proposal might be to include a mechanism for distributing the benefits in proportion to the efforts individual countries make to conserve and sustainably use biodiversity. It does not seem fair that countries which are the most environmentally destructive should receive the same as more responsible countries. However, it is very doubtful that setting up ‘genetic resource OPECs’ is feasible. First, many species have an extremely wide geographical distribution. Second, genetic resources are reproducible and highly portable, making it difficult to track their movements (Parry, 2000, p389). Third, it is to a large extent the information about the resource that makes it a ‘resource’ rather than its actual physical content. Thus, once this information has been gleaned, the physical resource is unlikely to be of much interest. Fourth, whereas oil is a single natural resource with proven value, groups of countries would be trying to control not one but many resources almost none of which has any significant commercial applications. And it can take many years after discovering a piece of genetic information from, say, a plant to identify a genuine commercial application, especially if this would require the information to be combined with other pieces of genetic information from different species and even
10 Knowledge, Property and Trade different (biological) kingdoms. At the same time, these countries would continue to need to access other resources from non-cartel members.
COMMON HERITAGE Another important principle to have emerged in international law with implications for access to natural resources, and rights to benefit from their use, is common heritage. This need not conflict with the principle of permanent sovereignty because it is normally applied to extraterritorial (and extraterrestrial) non-living resources. The common heritage principle of international law is explicitly included in two international treaties. These are the 1979 Agreement Governing the Activities of States on the Moon and Other Celestial Bodies, and the 1982 United Nations (UN) Convention on the Law of the Sea. Common heritage resources are owned by nobody, but members of the international community of nations have an equal duty to conserve them and a right to benefit from their use (Birnie and Boyle, 2002, p143). Common heritage resources may be contrasted with common property ones, which in international law are also unowned but are subject to no access controls, and which may include both living and non-living resources outside national jurisdictions. Classic common property resources include the high seas and airspace. Scarcity – or at least perceptions of scarcity – of resources considered previously to be abundant and requiring few if any conservation measures is a key motivation for governments and others to turn away from common heritage and common property regimes to more restrictive ones such as permanent sovereignty and private property.10 It is commonly but erroneously assumed that until the 1990s, when the CBD came into force, biogenetic resources were subject to the common heritage of mankind principle. It is true that the 1983 International Undertaking on Plant Genetic Resources (IUPGR) treated plant genetic resources as the common heritage of mankind. But this was a non-legally binding agreement and did not really constitute an explicit renunciation by signatory countries of their permanent sovereign rights over natural resources even though the resources it applied to were territorial. Indeed, the concept was initially popular with many developing countries not because they felt it diminished their rights in any way, but because they intended it as an attack on IPRs, particularly plant variety protection.11 In fact, the IU defined ‘plant genetic resources’ in a way that included not just currently used, newly developed, obsolete and primitive cultivated varieties and wild and weed species, but also special genetic stocks. Initially, the IU made no mention at all of IPRs, which suggested that stocks held by firms, including those under IPR protection, were also a heritage of mankind. For this reason, the seed industry found the IUPGR threatening, and in 1989 it was agreed through a special resolution of the FAO Commission on Plant Genetic Resources that plant breeders’ rights are not incompatible with the IUPGR (see Chapter 3 for more discussion of the IUPGR and the agreement that has succeeded it, the International Treaty on Plant Genetic Resources for Food and Agriculture).12
Sovereignty, Common Heritage and Property Rights 11
Beyond North versus South politics, though, the advantages for individual countries of aggressively asserting their sovereign rights over biogenetic resources were not so obvious (albeit with some important exceptions). For crop genetic resources, the appropriateness of applying the principle of permanent sovereignty appeared doubtful for a number of reasons. First, ever since the beginning of agriculture 10,000 years ago, these resources have generally been freely circulated. Attempts to restrict the movement of particularly valuable ones, such as when Brazil sought to prevent the exportation of rubber germplasm, have tended to be unsuccessful. Second, for many of these resources, it was no longer possible even to know their original source countries. Third, even countries rich in naturally occurring biogenetic diversity, such as Brazil and Kenya, may generate far more foreign exchange from the cultivation of (for them) exotic crops than from indigenous ones. Fourth, a vast quantity of crop genetic resources had already been transferred to and stored in ex situ collections of the CGIAR system, purportedly for the benefit of the international community including the developing countries. This situation also made policy-making complicated. Because so much crop germplasm was stored outside their source countries – which in many cases was difficult if not impossible to identify anyway – it was often very unclear which particular existing regime applied to particular resources.
INTELLECTUAL PROPERTY RIGHTS The businesses that use biogenetic resources are major users of intellectual property rights (IPRs) such as patents, plant variety protection (PVP) (or ‘plant breeders’ rights’ – PBRs), copyrights, trade marks and trade secrets. Two IPRs are of primary importance in the context of this book. These are patents and PVP (or PBRs). Patents provide inventors with legal rights to prevent others from using, selling or importing their inventions for a fixed period – nowadays normally 20 years. Applicants for a patent must satisfy a national patent issuing authority that the invention described in the application is new, susceptible of industrial application (or ‘useful’ in the US), and that its creation involved an inventive step beyond the present state of the art or would be unobvious to a skilled practitioner. For life science firms, which often need to spend heavily to discover new products, develop them and acquire regulatory approval to sell them, patents are essential for achieving high returns on their R&D investments. Patents are the subject of several international agreements, perhaps the most important being TRIPS and the 1883 Paris Convention for the Protection of Industrial Property.13 PVP systems protect new plant varieties that are distinct, uniform and stable. In both cases the rights are limited in time. PVP is the subject of the Convention of the International Union for the Protection of New Varieties of Plants, commonly known as the UPOV Convention.14 Unlike TRIPS and the
12 Knowledge, Property and Trade Paris Convention, neither of which deals exclusively with patents, UPOV’s rules are detailed and specific in terms of the legal system that countries must provide to be members of the union. IPRs are one of three emerging institutions that regulate the distributive aspects of the commercial use of biogenetic resources and related TK,15 the other two being national and regional ABS regimes and bioprospecting contracts. IPRs seem to be the most important of these in terms of influencing the way benefits are generated and distributed. For one thing, patents and PVP certificates can be extremely significant economic assets for firms. For another, they are, arguably, necessary incentives for undertaking commercially oriented life science R&D. Furthermore, there is a very clear correspondence between the unequal distributions and concentrations of patent and PVP portfolios and the unequal share of benefits obtained from the industrial use of biogenetic resources, which is unlikely to be coincidental. One possible explanation for this correspondence is that these IPRs are designed to protect certain forms of intellectually based productions which the developed countries are good at coming up with, but in which developing countries do not excel. Thus, while corporations can acquire huge IP portfolios, holders of valuable knowledge common in developing countries – such as indigenous communities – find that the system does not meet their needs at all. To critics, this is unfair both for these communities and for those developing countries where the presence of local populations possessing and producing such knowledge could potentially provide competitive advantages for their economies. For example, treating ‘unimproved’ plant genetic resources in the form of landraces (or traditional cultivars) as common heritage while treating ‘improved’ ones as private intellectual property seems particularly unjust to those who would argue, with some justification, that to assume that plant genetic resources are mere gifts of nature fails to give credit to the knowledge and resource management practices of traditional communities past and present. A second possible explanation is that the economic power which transnational corporations acquire through intellectual property ownership actually hinders developing countries’ own efforts to harness their biogenetic resources for development through the wider use of advanced technologies. This power enables these businesses to control markets and place restrictions on access to and use of their products and technologies. However, IPRs can be tools for development. Just as inappropriate systems may harm the interests of developing countries, well designed IP regimes could, at least in theory, be highly beneficial and help such countries to add value to their biogenetic wealth. Two ways to achieve such value addition for the benefit of their economies would be, first, to come up with lucrative new science-based products by enhancing their research, development and production capacities and, second (alternatively or in addition), for developing countries to more effectively identify, develop and market high-value primary and semi-processed products. IPRs can certainly assist in the pursuit of both these objectives. As this book will show, there are good reasons to be sceptical that the TRIPS
Sovereignty, Common Heritage and Property Rights 13
Agreement and the UPOV Convention provide sufficient flexibility to allow countries to introduce supportive IP systems. With respect to the relationship between IPRs and national sovereignty, it is commonly believed in developing countries that the patenting of isolated biological compounds and genes breaches the sovereign rights of countries from which these materials were acquired or originally came. This is another important issue that the book will discuss. Finally, there is one more possible reason for the special significance of PVP in the present context, which the book will investigate. This is that these rights may create perverse incentives to focus research on a narrow pool of genetic resources that supports agricultural systems based upon the large-scale cultivation of genetically uniform crop varieties (Rangnekar, 2000a), and thereby erode biodiversity and perhaps even undermine food security.
Chapter 2 BIOTECHNOLOGY AND THE EXPANDING BOUNDARIES OF INTELLECTUAL PROPERTY PROTECTION
BIOTECHNOLOGY AND THE LIFE SCIENCE INDUSTRIES One of the defining features of the modern economy and the international trade system is that those countries in which high-technology corporations are headquartered, or at least do their research and development (R&D), have experienced a transformation in the composition of their export trade in manufactures. Since about 1970, for most developed countries, the contribution of advanced technologies to economic performance in terms of manufacturing value added and exports has increased substantially. Indeed, there appears to be a strong link between the ability of a country to conduct state-of-the-art applied research, the strength of its economy and the prosperity of its citizenry. Industrial development based on the applied life sciences, including biotechnology, is on the way to becoming a key source of economic growth in the developed world and has the potential to contribute to the economies of the developing countries as well as to the health and welfare of their populations. What is biotechnology? It is important to be aware that biotechnologies are both new and very old. This becomes evident if, as some experts do, one divides biotechnologies into three generations. The first generation includes traditional technologies like beer brewing and bread making, which go back thousands of years, and the second begins with the microbiological applications developed by Louis Pasteur culminating in the mass production by fermentation of the antibiotics. Tissue culture and modern plant and animal breeding also fall within this ‘generation’. The third generation biotechnologies, or ‘the new biotechnologies’, include the various genetic engineering techniques for transferring DNA from one life-form to another to make transgenic organisms expressing new and useful traits. The first such technique, known as recombinant DNA (rDNA), was invented in 1973 by Stanley Cohen at Stanford University and Herbert Boyer at the University of California at San Francisco
Biotechnology and the Expanding Boundaries of Intellectual Property Protection 15
(UCSF), and patented by the former university. The technique enabled foreign genes to be inserted into micro-organisms and passed on to others through cell division. Since then other genetic engineering techniques have been invented. This latest generation of biotechnologies also includes hybridoma technology,1 polymerase chain reaction (PCR)2 and cloning. To date, most government funding and commercial activity relating to the new biotechnologies has been in the area of health. Health biotechnology is not only used to develop new types of drug but is also used in diagnostics and to enhance the efficiency of the drug discovery process. In fact, the latter has become the main objective of such research. The types of product being developed include so-called ‘biopharmaceuticals’ such as genetically engineered therapeutic proteins and vaccines. Other common types of product are diagnostic kits for diseases linked to genetic defects. Agricultural biotechnology is a much smaller field in the US and Europe. Much of the research done so far has been geared towards the development of new seed products with introduced traits providing mainly agronomic benefits such as disease resistance, pest resistance and herbicide tolerance, and also to extend the shelf-life of harvested produce. Little of the research has been directed so far at improving output quality for the benefit of consumers, although this situation is beginning to change. This is one important reason why genetically modified (GM) crops are so controversial in Europe. The perception among many people is that consumers are expected to accept the unknown risks of consuming GM products and bear the consequences should something go wrong. Yet, unlike genetically engineered pharmaceuticals, these products provide no additional benefits for the public, as they would if they were cheaper or more nutritious. Unlike the healthcare arena, there are relatively few dedicated biotechnology firms (henceforth ‘DBFs’) working in agriculture, even in the US. Of the two fields, healthcare products tend to be more commercially attractive. This is because they have potentially much higher returns, and because demand tends to be much less cyclical. Most of the remaining biotechnology companies provide industrial or environmental products and services such as industrial enzymes and pollution diagnostics. The ‘biotechnology industry’ is not a discrete industrial sector. Rather, there are DBFs that do nothing but biotechnology, and other companies, universities and public research institutes that conduct biotechnological work but do not specialize in it. The new biotechnology and genomics revolutions have created completely new commercial opportunities, and spawned the following four types of business: 1 2 3
technology providers who manufacture DNA sequencing machines and other equipment; information providers that collect and organize sequencing information; research firms, consisting mainly of the DBFs that generally do the upstream (ie, basic) research but lack the resources or the ambition to do the downstream (ie, close to market) research, as well as the product development and marketing; and
16 Knowledge, Property and Trade 4
health, agricultural and industrial biotechnology firms. These include the larger vertically integrated DBFs, and much longer established businesses, which are mostly pharmaceutical, chemical and life science corporations.
These business types are not necessarily discrete. For example, while the companies Incyte and Celera are essentially information providers, Millennium Pharmaceuticals and Human Genome Sciences are also involved in drug discovery and development. As with other science-based sectors, the road leading from basic research to product development is long, winding and has many branches, some of which may be short cuts but are mostly dead ends. This road is also very expensive to use, especially as journey’s end approaches. In addition, the companies best equipped to carry a product to the end of the road are not necessarily the most competent to start the journey, just as front runners are often ill-equipped to complete a marathon course. This situation provides both obstacles and opportunities for business. For new start-up firms it is difficult to transform themselves into biopharmaceutical corporations. The opportunities lie in the fact that, as the big firms concentrate on their core competences, they outsource more and more tasks that may be essential elements of the R&D process. Therefore niches are created that new small and medium-sized science-based firms can profitably occupy. Arguably, biotechnology patents encourage such a diversification of business activity by stimulating the foundation of small but highly innovative firms and then by helping them to survive and remain independent. It has always been crucial to have access to large amounts of investment capital just to stay in business. Patent portfolios are the main magnet for outside investors – which also include larger science-based firms – and the larger the portfolio, the greater the interest from investors. In common with other industries, patents also become a form of currency in inter-firm transactions: [F]ew products can be developed, tested, approved by regulatory agencies, and on the markets in time to generate enough cash to save most biotechnology companies. For many companies, the patent becomes the product – the product that can be dangled before the investment community for more funds, or the product that can literally be sold to other companies (Fowler, 1994, p173). Research decisions in many companies can depend as much, if not more, on the advice of patent lawyers as the opinions of the scientists. Naturally, companies have a strong interest in securing patents that encompass the broadest possible scope and whose claims are drawn in ways that seek to anticipate future scientific developments. But from the view of the public interest, there is a danger in the increasing disintegration of the genomics innovation chain. For new DBFs that provide genetic information to the drug development firms, what they sell are, to them, final products, whereas to their customers further down the chain these products are merely research tools. In order to protect these ‘products’ – and to
Biotechnology and the Expanding Boundaries of Intellectual Property Protection 17
secure funding to produce further ones – the DBFs have a strong incentive to privatize their information through intellectual property rights (IPRs). But since the development of future commercial products such as therapeutic proteins or genetic diagnostic tests often requires the use of multiple research tools such as gene fragments, an increasing number of which are being patented, companies intending to develop such products will need to acquire licences from other patent holders. In doing so, they will incur large (and possibly prohibitive) transaction costs. To return to the road metaphor, the danger is that more and more tollgates will be installed, making the journey ever-more expensive and excluding more and more potential travellers. So not only is the product development race becoming a relay race with more and more runners, but each runner is being forced to pay for the privilege of receiving the baton from the previous runner. The question is, will this slow down innovation and lead to fewer products on the market than would otherwise be available? And if so, how should the regulation of innovation through intellectual property (IP) protection be re-contoured in response? To date much if not most of the basic research in biotechnology and genomics has been financed and conducted by governments, universities and private foundations. But private sector investment has increased in recent years, especially in the US where commercial biotechnology really began. There are various reasons why the US has dominated from the start. Two of the more important ones are, first, the considerable amount of related state-funded basic research that had already been conducted by the universities and government agencies and, second, the large quantities of venture capital funds that are available to start-up companies with a promising business plan. While the US system has been relatively effective at turning new discoveries made by public sector and university researchers into commercial products, Europe and Japan have been less successful in putting together the downstream linkages, from fundraising for basic research all the way to commercialization. However, since the 1980s, the European Community countries and Japan have been preoccupied with catching up with the US. Both the European Commission and the European Union (EU) member governments have sought to stimulate biotechnology R&D through industrial policy and more business friendly product and IPR regulation. So far they have been only partly successful, raising the question of whether developing countries can succeed no matter how carefully their IPR systems are designed. Developing countries vary considerably in the capacity of their research institutions and businesses to put the new biotechnologies to work and generate innovations of their own. Bhagavan (1997, pp3–4) divides developing countries according to their science and technology (S&T) capacities. Thus, these countries are members either of the ‘strong’, ‘medium’ or ‘weak’ South. The strong South includes Brazil, China, India and Mexico, which are moving into high-technology fields such as the third-generation biotechnologies. The medium South includes Indonesia, Malaysia and Argentina, while the weak South consists of most other countries which are as technologically dependent on the developed countries as they were before decolonization.
18 Knowledge, Property and Trade Several developing countries, including India, China, Brazil and Cuba, have the capacity to use third-generation biotechnologies. However, the overwhelming bulk of biotechnology applications, even in these countries, is of the earlier generations, such as fermentation and tissue culture. While health biotechnology is more important than agro-biotechnology in the US and Europe, agro-biotechnology has been prioritized by many developing-country governments, such as India and Kenya. This is largely due to the dependence of most emerging national economies on the viability of agricultural sectors for food security and employment, and in many cases, foreign exchange and political stability. Given the likelihood that sequencing and analysing human, animal, plant and microbial genomes and proteomes will take less and less time and money, one can anticipate a lowering of barriers to entry. This increases the possibility that a few developing countries like India, China and Brazil will become sources of innovations in this field in the coming years. It is perfectly feasible, then, to envisage a time in the near future when a developing country like India will not just be a recipient of gene technologies and products but will be a provider to global markets as well. It is frequently argued – or at least strongly implied – that biotechnology has nothing to offer developing countries. This view tends to be founded upon two convictions: first, that transnational corporations are aggressively promoting inappropriate and potentially dangerous genetic modification (GM) technologies in countries where biosafety regulations either do not exist or cannot easily be enforced (Masood, 2000); and second, that traditional natural products like cocoa and vanilla, upon which some countries are heavily dependent, may be displaced by laboratory-produced substitutes. Supporters of biotechnology are likely to counter that whether or not transnational life science corporations are guilty of foisting inappropriate and unnecessary technologies on developing countries, the dangers of genetically modified organisms have been exaggerated. Furthermore, there are no scientific reasons why GM crops cannot be designed with the needs and interests of poor farmers and consumers in mind. Moreover, most second- and third-generation biotechnologies are not capital intensive compared to most other advanced technological fields (Juma and Ojwang, 1992, pp28–29). Therefore, entry barriers need not be prohibitively high as long as there are adequate capacities in all the related disciplinary fields including fermentation science and chemical engineering, and a conducive institutional environment.3
THE COMMERCIAL IMPORTANCE OF BIOGENETIC RESOURCES AND TRADITIONAL KNOWLEDGE According to ten Kate and Laird’s (1999) detailed study on the commercial use of biodiversity, the annual market for products derived from genetic resources is between US$500 billion and $800 billion. This figure is based on statistics on the following industrial sectors, which depend to a greater or lesser degree on
Biotechnology and the Expanding Boundaries of Intellectual Property Protection 19
biogenetic resources: pharmaceuticals, botanical medicines, agricultural produce (including agricultural seed), ornamental horticultural products, crop protection products, biotechnologies in fields other than healthcare and agriculture, and personal care and cosmetics products. It should be noted that while not all of these are normally considered as being high-technology industries as such, the largest and most profitable industries, such as pharmaceuticals and industrial biotechnology, tend to require participating firms to have advanced science and technology capacities. Breaking these figures down by sector, ten Kate and Laird (1999) estimate the present size of the global market for pharmaceuticals as between US$75 billiion and $150 billion per annum (of which 25–50 per cent of the products derive from genetic resources). For agricultural seeds, the figure for annual sales is US$30 billion. For botanical medicines, it is US$20 billion to $40 billion. Other researchers have come up with figures supporting the case that biogenetic resources for health, food and agriculture and related traditional knowledge (TK) are of tremendous importance for the global economy. The estimated market value of plant-based medicines sold in Organisation for Economic Co-operation and Development (OECD) countries in 1990 was US$61 billion (Principe, 1998, pp44–45). Many of the pharmaceutical companies are likely to have used TK as leads in their product development, as demonstrated by Farnsworth’s estimate, referred to earlier, that of the 119 plant-based compounds used in medicine worldwide, 74 per cent had the same (or related) uses as the medicinal plants from which they were derived (1988, p95). A more recent estimate for the US is that from 1989 to 1995, 60 per cent of new anti-cancer and anti-infective drugs were of natural origin (Cragg et al, 1997, p52).4 Studies on the value of landraces as inputs in modern plant breeding are few and far between. But one study on the use and value of landraces for rice breeding in India estimated that rice landraces acquired from India and overseas contributed 5.6 per cent, or US$75 million, to India’s rice yields (Evenson, 1996). Assuming that landraces contribute equally to other countries where rice is cultivated, the global value added to rice yields by use of landraces can be estimated at US$400 million per year. Despite this obvious dependence of industry on biogenetic resources and TK over the years, does this mean that they still depend on resources and knowledge they have not yet discovered? Perhaps not so much. The failure of Shaman Pharmaceuticals, which sought to develop new drugs from ethnobotanical information provided by indigenous communities, is sometimes cited to demonstrate that TK provides no short-cuts for the industry in its costly search for profitable new cures. Moreover, according to ten Kate and Laird (1999, p57): natural products are likely to remain an important, although minor, component of drug discovery… However, the techniques of molecular biology and genetic engineering are likely to become the dominating factor in drug discovery, design and development.
20 Knowledge, Property and Trade On the other hand, the rapidly growing botanical medicine industry – which is particularly well established in countries with their own traditional health systems, like India and China – is very much dependent on plant genetic resources and traditional knowledge. As ten Kate and Laird explain (1999, p92), ‘traditional knowledge is widely used in the botanical medicine industry as the basis for determining safety and efficacy, to develop agronomic practices for cultivation of materials, and to guide the development of new products’. Mention of traditional use of a medicine is also frequently used in marketing. However, companies in this sector tend, for sound business reasons, to depend heavily on existing and well known natural products, and many of them are not seeking alternatives to these. As far as the development of new crop varieties goes, it is commonly agreed that the value of plant genetic resources for food and agriculture is increasing due to: the need for more food as a result of global population growth; the limited amount of new land being opened up for food production; and the increasing adoption of new biotechnologies (Brush, 1994), which allow gene transfer between more distantly related organisms, thereby expanding the pool of genes potentially available for the breeding of new crop varieties. Nevertheless, crop breeders still tend not to use landraces and ‘wild’ varieties in their breeding programmes.5 Landraces may be a useful source of desirable single genes, but will not be adapted for a wide range of conditions. They may also require considerable effort to breed out extraneous genetic material. Breeders thus tend to use varieties held in their own collections and those bred in public institutions. Increased adoption of genetic engineering and other biotechnological techniques, including transgenics, is expected to further reduce dependency on exotic plant germplasm (and local knowledge and skills). However, it is important not to overstate the point. Exotic germplasm is likely to be used when particular traits are sought, new breeding programmes are being started, or for long-term genetic enhancement, and also in the breeding of certain crops (eg potatoes). Indeed, even though a survey revealed that only 2.4 per cent of germplasm used in the development of new varieties comes from wild species or landraces maintained in situ (see Swanson, 1996), these resources are still important. Securing effective protection from diseases and pests in the long term is absolutely dependent on inputs of genes and traits that are new to the system in the sense of being undiscovered or known only to indigenous or traditional communities. This suggests that the large stocks of biogenetic resources in many developing countries may not have as much commercial potential as many people think. But this is not the same as saying that they have no potential. This is recognized by the many companies that are still keen to access and screen these resources.
INTELLECTUAL PROPERTY IN THE LIFE SCIENCES Intellectual property is very important for industries that develop products derived from biogenetic resources. For the pharmaceutical industry, patents are
Biotechnology and the Expanding Boundaries of Intellectual Property Protection 21
essential for companies to recoup their R&D expenses, which are well known as being very high. For plant breeding businesses, plant variety protection (PVP) is also important. As for the small DBFs operating in the health and agriculture sectors, as we saw earlier, patents are an essential means for acquiring outside financial support.
Patents The evolution of developed-country IPR regimes in the 20th century has been characterized by three phenomena. These are the broadening of existing rights, the creation of new rights, and the progressive standardization of the basic features of IPRs. At a superficial level, it may be argued that this evolution reflects the development of new technologies, the growth of industrial sectors that use them, and also the increased importance of IPRs to world trade. However, interest group politics involving businesses and IP practitioners has also had a tremendous influence on the expansion and strengthening of IP protection (see Braithwaite and Drahos, 2000; Dutfield, 2003; Matthews, 2002; Sell, 2003). In recent decades this evolution has been quite rapid. In the life sciences, most of the significant changes in patent law have taken place within the last 40 or so years. France began to allow patents on pharmaceuticals from 1960, and several other countries followed suit soon after, such as Ireland (from 1964), Germany (from 1968), Japan (from 1976), Switzerland (from 1977), Italy and Sweden (both from 1978) and Spain (from 1992). In 1969, the German Federal Supreme Court accepted the principle that animal breeding methods are patentable. In 1980, in the famous Diamond versus Chakrabarty case, the US Supreme Court ruled by a narrow majority that a micro-organism could be classed as a ‘composition of matter’ or an ‘article of manufacture’, and therefore be treated as a patentable invention. From about the same year, DNA sequences began to appear in patents. Since then, sequences of isolated and purified DNA from plants and other organisms are increasingly being claimed in patent applications. This has been criticized by those who wonder how, if patents apply to inventions but not discoveries, naturally occurring genes isolated in a laboratory can be patented. Companies and researchers defending such patenting argue that locating, isolating and describing molecular biological matter requires considerable ingenuity. If in doing so they have revealed to the world something that was previously unknown, and are able to explain its function and its possible industrial application, then they have an invention that should be patentable. Moreover, many claims are not actually for DNA in its raw state but for complementary DNA (cDNA). Therefore, defenders argue, as with any other synthetic chemicals, cDNA sequences should be patentable provided that they fulfil the normal criteria of inventiveness and that the application discloses a credible function. This view is consistent with European practice. In 1995, the Opposition Division of the European Patent Office (EPO) declared DNA to be ‘not “life”, but a chemical substance which carries genetic information’, and therefore patentable just as any other chemicals are.
22 Knowledge, Property and Trade Many critics are sceptical that the deletion of ‘junk DNA’ is inventive enough to deserve the reward of a patent on the grounds that a claimed cDNA molecule is likely to be obvious to somebody ‘skilled in the art’ who knew the sequence of its naturally occurring equivalent. Furthermore, as some critics point out, gene function is so complex that treating genes as patentable inventions on the basis of a single discovered function is more a reflection of ignorance than of insight. Another argument is that the patenting of genes and gene fragments used in basic research may be placing undesirable restrictions on the ability of other scientists to use these in their own research. At the macro-biological level, the patenting situation has also changed since the early 1980s. In a 1985 patent appeals case, the US Patent and Trademark Office (PTO) affirmed the patentability of plants, seeds and plant tissue cultures. In 1987, the PTO announced that it would accept applications for multicellular organisms. A year later the first ever animal patent was granted for ‘a transgenic nonhuman mammal’ containing an activated oncogene sequence.6 Although Europe is generally considered to be a follower of the US down the ‘slippery slope’ of life-forms patenting, this has not always been the case. In 1975, five years before the US, the German Federal Supreme Court ruled that micro-organisms were patentable. Also, the UK Patent Office granted a patent on Chakrabarty’s oil-eating bacterium during the 1970s without publicity. However, ‘patenting life’ became much more controversial in Europe than in the US, and it was only in 1988 that the EPO granted the first patent on a plant. The European oncomouse patent was granted after initially being rejected, but has attracted fierce and determined opposition ever since. When the European Commission decided in the late 1980s to draft a directive on the legal protection of biotechnological inventions, there was tremendous opposition from civil society organizations. The European Commission was motivated by concerns about the legal uncertainties which, it was felt, could be prejudicial to the future of biotechnology in Europe, and fears that some European countries might respond to mounting controversy by banning patents on living organisms and genes. It was expected that the directive would harmonize European patent law relating to biotechnology around high minimum standards, while preventing European Commission Member States from ‘backsliding’. However, it was only in 1998 that the Directive on the Legal Protection of Biotechnological Inventions was finally adopted, and it has still not been implemented in all EU Member States. As for Japan, micro-organisms became patentable in 1979, plants in 1985 and animals in 1993. In the developing world, in contrast, there was little interest in following such trends. But following the TRIPS Agreement coming into force in 1995, this situation is changing (see Chapter 3). These trends have caused a great deal of alarm and protest. Without going into the various arguments employed on both sides of the divide, it is interesting to briefly discuss the fundamental issue of whether patents were ever meant to protect living things. It is a popular assumption that patents are for mechanical devices, with mousetraps frequently mentioned as typical examples of what inventors seek patents for. But this has never really been accurate. To illustrate this point, in 1724 Thomas Greening was granted an
Biotechnology and the Expanding Boundaries of Intellectual Property Protection 23
English patent for ‘grafting or budding the English elm upon the stock of the Dutch elm’. In 1785, Philip Le Brocq acquired a patent for ‘rearing, cultivating, training, and bringing to perfection, all kinds of fruit trees, shrubs, and plants; protecting their leaves, blossoms, flowers and fruits’. Nonetheless, the patenting of plants, seeds and plant parts was never common in the past and only appears to have started in the 1930s, and even then it was quite rare. The US Plant Patent Act of 1930 provided a type of patent to asexually reproduced plants. In Europe, patents were occasionally granted during that period. In 1936, for example, the German Appeal Board accepted an application for a patent that claimed seed material of certain varieties of lupin. During the 1940s and early 1950s, countries adopted a range of approaches, from denying all intellectual property protection (for example, Britain and Denmark), to allowing patents (Italy from 1948, France from 1949, and Belgium from 1950), and creating specific IP systems for plant varieties (for example, the Netherlands in 1941, Austria in 1946, and Germany in 1953). South Africa followed the US example by introducing a modified patent system for plants in 1952. In 1985, as we have seen, the US led the way in extending the patent system more clearly to plants and plant material. By 1988 over 40 patents on crop plants had already been issued. By the end of September 2001, there were more than 1800 US patents with claims to plants, seeds, or plant parts or tissues. Nonetheless, the 1985 decision did not permanently settle the question of whether or not plants are patentable. In December 2001, the Supreme Court finally confirmed the legality of patents on plants. The opportunity to do so arose because lawyers representing a company called J.E.M. Ag Supply, that was being sued by Pioneer Hi-Bred for patent infringement, requested the court to determine whether plant-related patents were invalid because of the existence of two intellectual property laws designed specifically to protect plants: the 1930 Plant Patent Act and the 1970 Plant Variety Protection Act. By a 6–2 majority, the Supreme Court rejected J.E.M. Ag Supply’s argument and upheld Pioneer’s patents. The situation in Europe with respect to the patenting of plant-related inventions has been plagued by legal uncertainties. The 1973 European Patent Convention (EPC) states in Article 53(b) that patents shall not be granted in respect of ‘plant or animal varieties or essentially biological processes for the production of plants or animals’. This did not settle matters completely. Although from 1988 the EPO began to grant patents on plants, in 1995 the EPO Technical Board of Appeal in Greenpeace versus Plant Genetic Systems ruled on an appeal against the upholding of a plant-related patent and determined that a claim for plant cells contained in a plant is unpatentable since it does not exclude plant varieties from its scope, and also that ‘plant cells as such cannot be considered to fall under the definition of plant or of plant variety’. This implied that transgenic plants per se were unpatentable because of the plant variety exclusion. Consequently, for the next four years the EPO stopped accepting claims on plants per se. However, in December 1999, the EPO Enlarged Board of Appeal decided that, while ‘plant varieties containing
24 Knowledge, Property and Trade genes introduced into an ancestral plant by recombinant gene technology are excluded from patentability… a claim wherein specific plant varieties are not individually claimed is not excluded from patentability under Article 53(b), EPC even though it may embrace plant varieties’.7 According to Article 3(2) of the Directive on the Legal Protection of Biotechnological Inventions, ‘biological material which is isolated from its natural environment or produced by means of a technical process may be the subject of an invention even if it previously occurred in nature.’ As with the convention, animal and plant varieties and essentially biological processes for the production of plants and animals are excepted. Article 2.2 clarifies that ‘a process for the production of plants or animals is essentially biological if it consists entirely of natural phenomena such as crossing or selection.’ This definition has been accepted by the EPO. Outside Europe and the US, the legal situation is even more uncertain and has not yet been resolved by the international rules. Article 27.3(b) of the TRIPS Agreement echoes the EPC by allowing countries to exclude from patentability ‘plants and animals other than micro-organisms, and essentially biological processes for the production of plants or animals other than nonbiological and microbiological processes’. It also states that countries ‘shall provide for the protection of plant varieties either by patents or by an effective sui generis system or by any combination thereof.’ Yet many developing countries have yet to fulfil their obligations in this respect, and it would be fair to say that a number of them are unclear on how they should best do so. The majority do not allow plants to be patented. However, many of those governments, expressing a preference for alternative intellectual property systems to protect plant varieties, are generally reluctant to extend patent protection to biotechnological inventions, and have criticized the distinction between micro-organisms and other types of organism, and between microbiological processes and other biological ones, as being artificial and contrary to the basic tenets of patent law (see Chapter 12).
Plant variety protection Plant variety protection (PVP) certificates provide legal rights for breeders over the varieties they produce which fulfil the criteria of novelty, distinctness, uniformity and stability. Virtually all national and regional PVP systems are based to a greater or lesser degree on the UPOV Convention. The UPOV Convention is covered in Chapter 3.
Chapter 3 THE INTERNATIONAL LAW OF BIOGENETIC RESOURCES AND INTELLECTUAL PROPERTY
As explained in Chapter 1, the key international agreements relevant to intellectual property (IP) and biogenetic resources are the TRIPS Agreement, the UPOV Convention, the Convention on Biological Diversity (CBD), and the International Treaty on Plant Genetic Resources for Food and Agriculture. This chapter presents the most relevant provisions of these agreements and discusses some of their wider implications.
THE TRIPS AGREEMENT The TRIPS Agreement is now the key international agreement promoting the standardization of national intellectual property right (IPR) regimes.1 TRIPS was one of the outcomes of the Uruguay Round of trade negotiations of the General Agreement on Tariffs and Trade (GATT), which established a new intergovernmental organization known as the World Trade Organization (WTO). The reason for the inclusion of IPRs in the Uruguay Round agenda had much to do with the effective lobbying of industrial concerns, mostly in the US, and the attraction to the developed countries and corporations of the existence of a dispute settlement mechanism within GATT that was lacking from the World Intellectual Property Organization (WIPO), the United Nations specialized agency dealing with IPRs. While the Agreement is highly beneficial for science-based corporations, the copyright industries and businesses that market well known brands, seeking to expand their sales in developing countries and blocking free-riding, it has also come under heavy criticism. One of the main criticisms is that the relatively high standards of protection and enforcement set by the Agreement do not appear to be appropriate for developing countries that are net importers of technologies and IP-protected goods and that would probably benefit more from much lower standards at the present time (Commission on Intellectual Property Rights (CIPR), 2002). This section presents the main objectives and general principles of the Agreement and the provisions most relevant to the subject matter of the book.
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Objectives and general principles The objective of the protection and enforcement of IPRs as required by the TRIPS Agreement, is to ‘contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations’. This clearly acknowledges the public policy objectives of IPRs. Article 8.1 allows WTO Members, ‘in formulating or amending their laws and regulations, [to] adopt measures necessary to protect public health and nutrition, and to promote the public interest in sectors of vital importance to their socioeconomic and technological development’, but with the proviso ‘that such measures are consistent with the provisions of this Agreement.’ By virtue of Article 3, Members accept the principle of national treatment, which is that each country must treat nationals of other Members at least as well as it treats its own nationals. This principle is well established in international law, dating back to the 19th century. National treatment should be contrasted with the principle of reciprocity, according to which rights or concessions are available only to foreigners from countries that provide the same rights or concessions. Foreigners from other countries are unable to avail themselves of protection according to the latter principle. The US applied the principle of reciprocity rather than national treatment when it enacted its 1984 Semiconductor Chip Protection Act, as did the European Union with its 1996 Directive on the Legal Protection of Databases.2 Application of the reciprocity principle to IPR regulation is contrary to the TRIPS Agreement. Article 4 upholds the principle of most-favoured-nation. This means that any concession granted by one Member to another must be accorded to all other Members ‘immediately and unconditionally’. So if country A agrees to take special measures to prevent the copying of the products of a company from country B, but turns a blind eye when the company is from country C, D or E, such inconsistency of treatment will violate this principle. Although this principle of international trade law is well established, TRIPS is the first multilateral IPR treaty that refers to it. All countries must have applied Articles 3, 4 and 53 within one year of the entry into force of the WTO Agreement. But the developing countries and the former centrally planned socialist states were allowed a period of five years from the date of entry into force of the WTO Agreement to apply the full provisions of TRIPS, which was until 1 January 2000. Developing country Members that are required to extend product patent protection to areas of technology not hitherto covered in their laws are permitted to delay such extension until 1 January 2005. The least-developed countries are allowed until 1 January 2006 to apply TRIPS in full. Upon request to the Council for TRIPS, they may also be granted further extensions to this period. The 2001 Doha Declaration on the TRIPS Agreement and Public Health allows least-developed countries to delay implementation of patent protection for pharmaceutical products and legal protection of undisclosed test data submitted as a condition
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of approving the marketing of pharmaceuticals until 1 January 2016. Countries joining the WTO after its establishment are also required to comply with these deadlines.
Patents According to the first paragraph of Article 27, which deals with patentable subject matter, ‘patents shall be available for any inventions, whether products or processes, in all fields of technology, provided that they are new, involve an inventive step and are capable of industrial application’. Paragraph 1 also requires that patents be available and patent rights enjoyable ‘without discrimination as to the place of invention, the field of technology and whether products are imported or locally produced’. To understand the meaning and purpose of this clause, it needs to be divided into the three areas in which it forbids discrimination. The first, relating to place of invention, required the US to change its patent law. The US is now unique in its persistence with a first-to-invent system as opposed to first-to-file, which operates elsewhere in the world. The problem at the time was that when it came to establishing priority of invention in cases of dispute, the US patent system and the courts were barred from accepting foreign evidence of dates of invention and consequently discriminated against foreign inventions (Charnovitz, 1998, pp133–134), which of course tended to be made by non-US nationals.4 The second area of non-discrimination relates to field of technology. This provision is very favourable for corporations which dislike the idea that technological fields such as pharmaceuticals can be excluded from patentability. In fact, the requirement that WTO Members extend protection to pharmaceutical products was an important victory for this industry. The third area of non-discrimination means that in countries where governments require inventors to place their patented products, or products manufactured from their patented processes, on the market, this does not mean they have to make them locally in order to enjoy their patent rights. They can simply import them instead (Carvalho, 2002, p162). Paragraph 27 also permits certain exclusions. Subparagraph 2 states as follows: Members may exclude from patentability inventions, the prevention within their territory of the commercial exploitation of which is necessary to protect ordre public or morality, including to protect human, animal or plant life or health or to avoid serious prejudice to the environment, provided that such exclusion is not made merely because the exploitation is prohibited by their law. The terms ‘ordre public’ and ‘morality’ are not defined in TRIPS although references to human, animal or plant life or health and the environment provide some context. The language of Article 27.2 follows very closely that of the European Patent Convention (EPC), yet even in Europe, the true meaning and potential extent of the ordre public/morality exclusions remain unresolved. In French civil law, ‘ordre public’ has a wider meaning than ‘public order’ and is
28 Knowledge, Property and Trade more akin to ‘public policy’. According to one interpretation of the term, ‘although the expression includes “public order” in so far as this relates to, for example, rioting, the expression primarily covers such matters as good government, the administration of justice, public services, national economic policy and the proper conduct of affairs in the general interest of the state and society’ (Board of Trade (UK) 1970, p68). Accepting this rather broad interpretation of the term appears to give WTO Members quite a lot of freedom to exclude inventions they consider to be undesirable. But legal experts tend to assume that TRIPS compatibility requires governments to apply the ordre public and morality exclusions narrowly on a case-by-case basis rather than to broad classes of patents such as life-forms in their broadest sense (Moufang, 1998). Otherwise, such patents would have been outlawed by TRIPS, or, at the very least, the option to outlaw them would have been explicitly indicated. Article 70.8 requires that Members that do not provide patent protection for pharmaceutical and agricultural chemical products in accordance with the permitted grace periods, as described above, to provide a facility by which applications for such inventions can be filed (a so-called ‘mailbox’ system). Paragraph 9 requires that where a product is the subject of a patent application, exclusive marketing rights shall be granted for a period of five years after obtaining market approval in that Member State or until a product patent is granted or rejected there, whichever period is shorter, if a patent and marketing approval have been obtained in another Member State.
‘Patenting life’ and the sui generis option Paragraph 3 states that members may also exclude from patentability: (a) diagnostic, therapeutic and surgical methods for the treatment of humans or animals; (b) plants and animals other than micro-organisms, and essentially biological processes for the production of plants or animals other than non-biological and microbiological processes. However, Members shall provide for the protection of plant varieties either by patents or by an effective sui generis system or by any combination thereof. The provisions of this subparagraph shall be reviewed four years after the entry into force of the WTO Agreement. With respect to products, plants and animals may be excluded from patentability. As regards processes, essentially biological processes for the production of plants or animals may also be excluded. Patents must be available for micro-organisms as products and for non-biological and microbiological processes for producing plants or animals. Patent protection need not be available for plant varieties but an effective IPR system is still obligatory. This may be an UPOV-type plant variety protection (PVP) system, another sui generis alternative, or some combination of systems. As indicated, this provision is subject to review.
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Otherwise, the meaning of Article 27.3(b) is far from straightforward, and is open to different interpretations. Difficulties arise both in the definition of terms and in the extent to which exceptions are allowed. One of the key areas of uncertainty, or opportunity as some might see it, is how ‘micro-organism’ should reasonably be defined in the law or interpreted by the patent granting offices. Few biologists would dispute the definition of microorganism as ‘any of various microscopic organisms, including algae, bacteria, fungi, protozoa, and viruses’.5 But the patent rules do not necessarily have to stick to such a definition, and have in fact tended not to. Thus, the European, US and Japanese patent rules do not actually define the term, but the granting offices in each of these jurisdictions have interpreted ‘micro-organism’ in such a way as to include plant and animal cells (Adcock and Llewelyn, 2000). For example, referring to Europe, Philip Grubb (1999), an Intellectual Property Counsel at Novartis, notes that ‘the term “micro-organism” is interpreted broadly so as to include not only bacteria and fungi but also viruses, and animal and plant cells’. Similar interpretations hold in the US and Japan. While this is no doubt a good thing for many businesses, the notion that a single cell from a multi-cellular organism is itself an organism seems somewhat questionable and is not one that other countries are required to adopt. In Chapter 1, we saw how difficult it can be to distinguish between a plant and a plant variety. In addition, one may reasonably wonder where one draws the line between an essentially biological process on the one hand and nonbiological and microbiological ones on the other. Article 27.3(b) draws on the language of the EPC, which in turn drew upon the Council of Europe’s Convention on the Unification of Certain Points of Substantive Law on Patents for Invention, which was adopted in 1963. The negotiating history of the latter Convention is somewhat helpful. It tells us that ‘essentially biological’ replaced the term ‘purely biological’ from an earlier version of the text. The Council’s Committee of Experts on Patents, which was responsible for drafting the convention, changed the wording to broaden the exclusionary language to embrace such ‘essentially biological’ processes as varietal selection and hybridization methods even if ‘technical’ devices were utilized to carry out the breeding processes (Bent et al, 1987, pp66–67). It should be noted that two years earlier, the UPOV Convention had been adopted, which sought to protect plant breeding innovations derived from such biological processes. The singling out of microbiological processes and products was made at the suggestion of an NGO called the International Association for the Protection of Industrial Property (AIPPI), which pointed out that micro-organisms were commonly used for industrial purposes, such as in brewing and baking (Bent et al, 1987, p66). Since that time, the European Patent Office (EPO) has sought to further clarify the term. According to the EPO guidelines for examiners, The question whether a process is ‘essentially biological’ is one of degree depending on the extent to which there is technical intervention by man in the process; if such intervention plays a significant part in determining or controlling the result it is desired to achieve, the process would not be excluded.
30 Knowledge, Property and Trade In 1995, the EPO Technical Board of Appeal in Greenpeace versus Plant Genetic Systems NV affirmed that ‘a process … comprising at least one essential technical step, which cannot be carried out without human intervention and which has a decisive impact on the final result’ is not essentially biological and would thus be patentable. On the other hand, conventional plant and animal breeding methods and other techniques such as artificial insemination would not be (Warren-Jones, 2001, p122).
Geographical indications Geographical indications (GIs) are defined in the TRIPS Agreement as ‘indications which identify a good as originating in the territory of a Member, or a region or locality in that territory, where a given quality, reputation, or other characteristic of the good is essentially attributable to its geographical origin’. GIs are similar in function to trade marks, the difference being that the former identifies a product with a particular territory, whereas the latter identifies a product with a company or brand (Moran, 1993). According to Vivas-Eugui (2001), the GI concept embraces various elements including that: GIs identify goods rather than services; GIs do not protect ideas or procedures, but simply identify and differentiate products in the market; and there must be a special link between the origin and the quality, reputation or special characteristics. Perhaps the best known type of geographical indication is the appellation of origin. Appellation of origin was originally a French system that was applied to products considered to be distinctive due to a combination of traditional know-how and highly localized natural conditions. The system evolved in France in response to problems of illegal labelling and overproduction. A government agency validates Appellation d’Origine Contrôlée, so that producers of wines, cheeses and other foodstuffs, whose goods are renowned for their distinctive qualities and geographic origins, are protected from those who would undermine or exploit their good reputation by making similar, but false, claims (Bérard and Marchenay, 1996). For example, wines from the Champagne region of France are protected this way; local producers acting collectively have prevented the use of the word ‘Champagne’ on bottles of perfume, English wine, and German shampoo (Freedman, 1994). However, some other wine-producing countries do not accept the necessity for an appellation system. In the US, it is considered allowable under certain circumstances to use a French appellation preceded by the origin of the wine (eg Californian Chablis) (Moran, 1993). WTO Members are required to permit legal action enabling traders to prevent: (a) the designation or presentation of a good (such as a trade mark) that suggests, in a manner that misleads the public, that the good in question originates in a geographical area other than the true place of origin; and (b) any use which constitutes unfair competition (Article 22.2, 22.3). Article 23 deals solely with wines and spirits, which are subject to additional protection. This evidences how far the European wine- and spirit-exporting countries were willing to go in pursuit of their economic interests with respect to such goods.
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The application of the provisions of this section of TRIPS is to be reviewed periodically by the Council for TRIPS (Article 24). In November 2001, the WTO Members attending the Doha Ministerial Conference agreed ‘to negotiate the establishment of a multilateral system of notification and registration of geographical indications for wines and spirits by the Fifth Session of the Ministerial Conference’. With respect to the extension of the protection of geographical indications to products other than wines and spirits, it was agreed that issues related to this matter would be addressed in the Council for TRIPS, an indication of the lack of consensus. For many developing countries, the additional protection extended to such goods is an example of the lack of balance in TRIPS. For example, New World developing countries like Chile and Argentina and also South Africa are competitors with Europe but are unable to avail themselves of GI protection to the same extent. Therefore, some of these countries feel, additional protection will only undermine their competitive advantage. Some developed countries, such as Australia, feel the same way. To another set of developing countries, the additional protection is unfair but for another reason: while they consider that GIs could be useful for certain goods, they do not produce significant quantities of wines and spirits. So to confine the additional protection to wines and spirits is discriminatory and can be of no economic benefit to them. Since the interests and negotiating positions of developing countries are quite divergent, and those of the developed countries also differ quite widely, it is unclear where these negotiations will lead. Nonetheless, the European Union (EU) and the Swiss government are very keen to promote GIs worldwide, claiming that this part of TRIPS can potentially provide substantial gains for developing countries. This seems plausible when one considers that GIs are especially appropriate for the produce of small-scale producers and cultivators, and, it should be underlined here, not just for foods and beverages but also handicrafts and other handmade items. Indeed, it may be argued that when countries adopt such an IPR, they implicitly accept ‘the underlying philosophy of the distinctiveness of local and regional products’, and also that ‘globalization of … artisanally-based principles’ inherent to GIs ‘counters the standardization of products which is normally considered the outcome of the internationalization of the agro-food industries [and] assists small family firms to resist the industrialization and corporatization of production’ (Moran, 1993). For several developing countries, then, GIs would appear to have real potential in terms of developing and exploiting lucrative markets for natural products including those manufactured by resource-poor farming communities. But they are useless without good standards of quality control and marketing, and up-to-date information on markets, including foreign ones, if the products are to be exported. At present the potential of GIs for developing countries is somewhat speculative because this type of IPR has been used in only a few countries outside Europe. It should be borne in mind that many GIs have quite small markets, and a relatively small number trade internationally. Moreover, some countries are concerned that the present enthusiasm for GIs among Europeans is really about protectionism.
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Undisclosed information The inclusion of undisclosed information in TRIPS was strongly opposed by developing countries that did not consider confidential information to be a form of IP. However, Switzerland and the US, who were concerned to safeguard trade secrets internationally, successfully persuaded other governments to accept their proposal for such protection (Blakeney, 1996). Because no previous convention provides for the protection of undisclosed information, the strategy adopted by the two countries was to argue that such protection is a necessary measure if countries are to fulfil their obligations to suppress unfair competition as required by Article 2 of TRIPS – which requires Members to comply with various parts of the Paris Convention including the provisions dealing with unfair competition. Members must enable natural and legal persons to prevent ‘information lawfully within their control from being disclosed to, acquired by, or used by others without their consent in a manner contrary to honest commercial practices.’ Acts contrary to honest commercial practices that are mentioned include breach of contract and breach of confidence. To be protected, information must be secret (ie not generally known among or readily accessible to persons within the circles that normally deal with the kind of information in question); have commercial value because it is secret; and have been subject to reasonable steps to keep it secret. It can be argued that trade secrets do not serve the public interest as well as patents. This is because, while society may benefit from availability of the product or technology associated with a trade secret, this kind of IPR keeps technical information that would be disclosed in a patent application outside the public domain. Nevertheless, effective trade secrecy protection is widely considered to be essential for encouraging technology transfer. It is also important for the seed industry where it is commonly used to protect the inbred parent lines of hybrids, since if this information were accessed by competitors, the same hybrids could easily be developed by these rivals.
Trade marks Trade marks are marketing tools used to support a company’s claim that its products or services are authentic or distinctive compared with similar products or services of competitors. TRIPS defines a trade mark as ‘any sign, or any combination of signs, capable of distinguishing the goods or services of one undertaking from those of other undertakings’. Trade marks usually consist of a distinctive design, word or series of words placed on a product label. In some jurisdictions, sounds, shapes and smells can also be protected as trade marks. Registered trade marks must be renewable indefinitely (Article 18), though in most jurisdictions this is subject to continued use. The trade mark owner has the exclusive right to prevent third parties from using identical or similar marks in the sale of identical or similar classes of goods or services, and thereby confuse customers. Trade marks make products identifiable from similar products available in the market and encourage producers to strive to maintain the value of their marks.
The International Law of Biogenetic Resources and Intellectual Property 33
THE UPOV CONVENTION The existence of the UPOV Convention can be largely attributed to two organizations: the International Association for the Protection of Industrial Property (AIPPI), and the International Association of Plant Breeders (ASSINSEL). At the 1952 AIPPI Congress, the delegates, partly at the urging of ASSINSEL’s representatives, discussed the issue of plant varieties. There was general agreement that plant varieties should be legally protected in some way. The most concrete ideas came from the German AIPPI group, which submitted a detailed technical report. As the report noted, it is a normal requirement of patentability that other people skilled in the art should be able to reproduce the invention described in the specification. That is to say, following the instructions provided in the specification should result in the invention as claimed. However, as the authors explained, when it comes to plant breeding, being able reliably to reproduce the new variety from the beginning is difficult because it depends on natural processes over which breeders do not have total control, and which are to some extent random. But repeating the whole breeding process is not necessarily important or even necessary. What really matters is that the new plant that has been brought into existence can be directly propagated. For sexually reproducing plants, this means that they must breed true so that the offspring are identical to their parents. As the report’s authors saw it, patents in their present form would accommodate a certain amount of innovation in plant breeding and should be made available to breeders. But, for many new varieties, workable IP protection would require a relaxation of the novelty and inventive step requirements so that varieties reflecting incremental improvements on existing ones and that were already known about could nonetheless be protected. The 1952 Congress could not reach a consensus on the means of protection, as AIPPI also failed to do at its next Congress two years later. One of the main reasons was that some of the patent lawyer members of AIPPI opposed the patenting of plant varieties on the grounds that doing so would stretch basic patent law concepts like inventiveness to the point of undermining the credibility of the patent system. ASSINSEL’s members decided at their own Congress in 1956 to abandon the patent route and to call for an international conference to consider the possibility of developing a new international instrument for protecting plant varieties. ASSINSEL requested the French government to organize what became the International Conference for the Protection of New Varieties of Plants. The Conference, which convened in May 1957 in Paris, established the basic principles of PVP that were later incorporated into the UPOV Convention. At the second meeting of the Conference in November 1961, the International Convention for the Protection of New Varieties of Plants (the UPOV Convention) was adopted. It was revised in 1972, 1978 and 1991. The 1978 Act entered into force in 1981, and the 1991 Act in 1998. The Convention established the International Union for the Protection of New Varieties of Plants (UPOV), which is based in Geneva and has a close association with WIPO.
34 Knowledge, Property and Trade To be eligible for protection under the UPOV system, plant varieties must be novel, distinct, stable and uniform (in UPOV 1991) or homogeneous (in UPOV 1978). To be novel, the variety must not have been offered for sale or marketed, with the agreement of the breeder or his successor in title, in the source country, or for longer than a limited number of years in any other country. To be distinct, the variety must be distinguishable by one or more characteristics from any other variety whose existence is a matter of common knowledge. To be considered as stable, the variety must remain true to its description after repeated reproduction or propagation. Unlike patents, there is no information disclosure requirement. Instead, applicants are required to submit the plant material for which protection is sought to the responsible governmental authority for testing to ensure that the above eligibility requirements have been met. This material may then be used by a government institution to demonstrate stability and homogeneity conclusively through propagation trials. The question arises of what a ‘plant variety’ is and how it may be distinguished, for the purposes of IPR protection, from a ‘plant’. This is very important given the increased application of genetic engineering to crop research and the fact that in some jurisdictions, plants are patentable but plant varieties are only protectable under national PVP systems. The original 1961 version of the UPOV Convention defined ‘plant variety’ as including ‘any cultivar, clone, line, stock or hybrid which is capable of cultivation’. Article 1 of the 1991 revision contains a more detailed definition, according to which a plant variety is: a plant grouping within a single botanical taxon of the lowest known rank, which grouping, irrespective of whether the conditions for the grant of a breeder’s right are fully met, can be: • • •
defined by the expression of the characteristics resulting from a given genotype or combination of genotypes, distinguished from any other plant grouping by the expression of at least one of the said characteristics, and considered as a unit with regard to its suitability for being propagated unchanged.
UPOV 1978, which several countries are still contracting parties to, defines the scope of protection as the breeder’s right to authorize the following acts: ‘the production for purposes of commercial marketing; the offering for sale; and the marketing of the reproductive or vegetative propagating material, as such, of the variety’. The 1991 version extends the scope of the breeders’ rights in two ways. First, it increases the number of acts for which prior authorization of the breeder is required. These include ‘production or reproduction; conditioning for the purpose of propagation; offering for sale; selling or other marketing; exporting; importing; stocking for the above purposes’. Second,
The International Law of Biogenetic Resources and Intellectual Property 35
such acts are not just in respect of the reproductive or vegetative propagating material, but also encompass harvested material obtained through the use of propagating material, and so-called ‘essentially derived’ varieties. However, the right of breeders both to use protected varieties as an initial source of variation for the creation of new varieties and to market these varieties without authorization from the original breeder (the ‘breeders’ exemption’) is upheld in both versions. One difference is that UPOV 1991 extends rights to varieties which are essentially derived from the protected variety. So the breeder of PVP-protected variety A has the right to demand that the breeder of variety B secure his or her authorization to commercialize B if it was essentially derived from A. The main idea is that breeders should not be able to acquire protection too easily for minor modifications of extant varieties or free-ride without doing any breeding of their own, problems that the increased application of biotechnology in this field appeared likely to exacerbate. Beyond resolving these particular issues, but related to them, the provision was also intended to ensure that patent rights and PVP rights operate in a harmonious fashion in jurisdictions where plants and their parts, seeds and genes are patentable and access to these could be blocked by patent holders. Such a practice would undermine one of the main justifications for PVP protection, which is that breeders should be able to secure returns on their investments but without preventing competitors from being able freely to access breeding material. An example might be helpful to illustrate this point. Let us consider the case of a PVP-protected variety called A and a patented genetic element owned by a separate company (see Jördens, 2002, p6). The owner of a patent on this genetic element is free to use A to produce his or her variety B and, absent of the essential derivation provision, place B on the market with no obligations to the owner of A despite the fact that B differs from A only in the addition of the patented genetic element. However, the owner of A would need a licence from the producer of B to use the patented genetic element in the breeding of further varieties. In such a situation, then, patents can have the effect of blocking the breeders’ exemption that PVP rights normally provide.6 It should be noted that the PVP-issuing office will not itself determine whether a variety is essentially derived from an earlier one. This will be left to the courts. There is no reference in the 1978 version to the right of farmers to re-sow seed harvested from protected varieties for their own use (often referred to as ‘farmers’ privilege’).7 The Convention establishes minimum standards such that the breeder’s prior authorization is required for at least the three acts mentioned above. Thus, countries that are members of the 1978 Convention are free to uphold farmers’ privilege or eliminate it. The 1991 version is more specific about this. Whereas the scope of the breeder’s right includes production or reproduction and conditioning for the purpose of propagation (Article 14), governments can use their discretion in deciding whether to uphold the farmers’ privilege. According to Article 15, the breeder’s right in relation to a variety may be restricted ‘in order to permit
36 Knowledge, Property and Trade farmers to use for propagating purposes, on their own holdings, the product of the harvest which they have obtained by planting … the protected variety’. Although the seed industry generally dislikes the farmers’ privilege, most countries upheld it until recently, either explicitly or by default. However, the EC Regulation 2100/94 on Community Plant Variety Rights, which was adopted in 1994, restricts farmers’ privilege to certain crops, and breeders must be remunerated through the payment of royalties unless they are small farmers, in which case they are exempted. The US is less strict in this regard, but seed saving must be restricted to the amount necessary for on-farm replanting. UPOV 1991 extends protection from at least 15 years to a minimum of 20 years. This later version is silent on the matter of double (that is, both patent and PVP) protection, whereas the earlier version stated that members ‘may recognize the right of the breeder provided for in this Convention by the grant either of a special title of protection or of a patent’. Removing the bar on double protection was intended to ensure that the US remained compliant with UPOV. Nonetheless, many countries expressly forbid the patenting of plant varieties, including most European countries. Supporters of UPOV 1991 argue that the changes encourage breeders to investigate minor crops and to bring whole new species into cultivation. Opponents, however, are sceptical about this claim and can offer empirical evidence casting doubt on whether PVP does much to encourage investment in plant breeding at all, except perhaps in just a few commercially important crop species such as wheat and soya (Janis and Kesan, 2002, pp775–776; Rangnekar, 2002a). Critics also argue that, even if breeders did turn to neglected crops, many of the small farmers who grow them would not be better off if their freedom to dispose of saved seed were diminished. In most developing countries a very large proportion of the farming population consists of smallholders, and for these people ‘seed saving from their harvest for further propagation, selling and exchanging of seeds is a common practice’ which contributes to food security (Verma, 1995, p286). In India, for example, farmers produce two-thirds of the country’s annual seed requirement (ibid.).8 UPOV advocates also deny that the 1991 revision is a move towards a form of patent protection. According to Lange, PVP and patents differ in quite fundamental ways, not just in terms of criteria for protection, but also of how the rights and obligations of producers and users are balanced. He argues that ‘breeding (including genetic engineering) is always based on what already exists, requires a broad range of variability and demands the free use of material’ (Lange, 1997, p27). Moreover: Since the purpose of plant variety protection is not to protect an invention, for instance a specific property in plant material, but the creation (including the discovery) of a new plant variety (that is to say a unique new ‘shuffled’ genotype with a corresponding phenotypical expression) ..., there must be the continuing possibility of using the protected material of competitors to develop new varieties with a new and unique genotype (for example, by crossing – that is to say a new ‘reshuffle’), without there being dependency [on the authorization of plant variety right holders] (Lange, 1997, p27).
The International Law of Biogenetic Resources and Intellectual Property 37
Until the late 1990s, the overwhelming majority of UPOV members were developed countries, reflecting the fact that in many developing countries, especially in Africa, private sector involvement in plant breeding and seed supply is quite limited. Moreover, as just mentioned, in many of these countries smallscale farming communities are responsible for much of the plant breeding and seed distribution, as they have been for centuries. Consequently, until recently, there would have been few domestic beneficiaries of a PVP system, especially if state involvement in breeding was also quite limited. However, many developing countries are now joining UPOV. In many if not most, cases, this is not because of any strong domestic demand for PVP, but because of their obligations under Article 27.3(b) of TRIPS. The UPOV system is the only sui generis system for plant varieties that exists in international law and is currently being actively promoted worldwide by the organization itself, as well as by the US and the EU through bilateral free trade agreements that require developing country parties to join UPOV. Despite the increasing membership of UPOV, one may reasonably wonder why breeders still tend to prefer PVP to patents, and also whether this particular IPR has a future. After all, patents provide much stronger legal protection. Moreover, breeders nowadays tend to work not for small independent seed firms, but for large life science corporations that invest huge sums in biotechnological research and hold massive patent portfolios. Probably the main reasons for this preference for PVP is the breeders’ exemption, which allows them such broad access to breeding material, and their concerns that the patenting of biotechnological research tools may jeopardize this access. This suggests that as long as there is profit-motivated plant breeding, PVP rights will continue to exist alongside patents, and sometimes in tension with them.
THE CONVENTION ON BIOLOGICAL DIVERSITY The Convention on Biological Diversity (CBD) came into force in 1993 and now has 188 Parties.9 The CBD has three main objectives: the conservation of biological diversity; the sustainable use of its components; and the fair and equitable sharing of the benefits arising out of the utilization of genetic resources, including by appropriate access to genetic resources and by appropriate transfer of relevant technologies, taking into account all rights over those resources and to technologies, and by appropriate funding. The key provisions in the CBD relating to intellectual property or traditional knowledge are in Articles 8, 15 and 16. Article 8(j) places three obligations on Contracting Parties to the CBD. These are as follows: 1 2
respect, preserve and maintain knowledge, innovations and practices of indigenous and local communities embodying traditional lifestyles relevant for the conservation and sustainable use of biological diversity; promote the wider application with the approval and involvement of the holders of such knowledge, innovations and practices; and
38 Knowledge, Property and Trade 3
encourage the equitable sharing of the benefits arising from the utilisation of such knowledge, innovations and practices.
The language is somewhat vague. Moreover, since the provisions are preceded by such terms as ‘subject to national legislation’ and ‘as far as possible and as appropriate’, the specific legal obligations of governments are difficult to discern and are probably quite limited. In 2000, the Conference of the Parties to the Convention on Biological Diversity decided to clarify things a little by adopting a decision, according to which ‘access to traditional knowledge, innovations and practices of indigenous and local communities should be subject to prior informed consent or prior informed approval from the holders of such knowledge, innovations and practices.’ Laudable and necessary as this is, applying prior informed consent (PIC) procedures to knowledge and biological material transactions involving indigenous peoples raises difficult practical and cultural issues and is therefore more easily said than done (Greene, 2002). Article 15 on access to genetic resources assigns to national governments the authority to determine such access,10 which is subject to the PIC of the provider country and the fair and equitable sharing of benefits. Presumably, the expectation here is that the exercise of such authority will enable countries to capture more of the benefits from industrial use of their biogenetic resources while conserving and sustainably utilizing biodiversity. Intellectual property is only explicitly referred to in the CBD in the context of technology transfer, which is supposed to be one of the main forms of benefit provider countries may receive.11 Article 16 on access to and transfer of technology requires parties to the Convention to undertake to provide and/or facilitate access and transfer of technologies to other parties under fair and most favourable terms. The only technology referred to is biotechnology, but Article 16 is concerned with any technologies ‘that are relevant to the conservation and sustainable use of biological diversity or make use of genetic resources and do not cause significant damage to the environment’. Recognizing that technologies are sometimes subject to patents and other IPRs, access to such technologies, according to Article 16.2, must be ‘on terms which recognize and are consistent with the adequate and effective protection of intellectual property rights’. Clearly this is nothing for industry to feel too concerned about. Indeed, the clause beginning ‘adequate and effective protection’ was specifically to establish a link with the draft TRIPS Agreement, which also used this language, as did the final version. Paragraph 16.5 is a little more controversial, requiring the parties to cooperate to ensure that patents and other IPRs ‘are supportive of and do not run counter to’ the CBD’s objectives. This reflects the profound disagreement during the negotiations between those who believed that IPRs conflict with the CBD’s objectives and others that saw no contradiction. While the language is not particularly threatening, life science firms in the US were nonetheless unhappy with the CBD’s coverage of IPRs and with the Convention more generally, and persuaded President George Bush (senior) that it was not in
The International Law of Biogenetic Resources and Intellectual Property 39
America’s best interests to sign it. Although the US did sign later, it remains one of the few countries in the world not to have ratified the CBD.12
THE INTERNATIONAL TREATY ON PLANT GENETIC RESOURCES FOR FOOD AND AGRICULTURE In 1983, the new Commission on Plant Genetic Resources (CPGR) of the Food and Agriculture Organization of the United Nations adopted the International Undertaking on Plant Genetic Resources (IUPGR).13 The objectives of the IUPGR were ‘to ensure the safe conservation and promote the unrestricted availability and sustainable utilization of plant genetic resources for present and future generations, by providing a flexible framework for sharing the benefits and burdens.’ Apart from the controversial common heritage doctrine, the implications of which were explained in Chapter 1, the IUPGR introduced another key concept: farmers’ rights. This was incorporated into the IUPGR in 1989 as part of a bargain, in return for which the developed countries’ insistence on excluding IPR-protected plant varieties from application of the common heritage principle was also acknowledged. In this context, it should be noted that the term ‘farmers’ rights’ has to be distinguished from the ‘farmers’ privilege’ as permitted under most PVP laws and the UPOV Convention. The latter is an exception to the breeders’ exclusive right. ‘Farmers’ rights’ is not an IPR as such, but it is frequently suggested as a principle that could be implemented as a compensation or benefit-sharing mechanism. CPGR Resolution 5/89 defined farmers’ rights as ‘rights arising from the past, present and future contributions of farmers in conserving, improving and making available plant genetic resources particularly those in the centres of origin/diversity. Those rights are vested in the international community, as trustees for present and future generations of farmers, and supporting the continuation of their contributions as well as the attainment of overall purposes of the International Undertaking [on Plant Genetic Resources]’. Implementation of farmers’ rights was principally to be through the voluntary International Fund for Plant Genetic Resources. Farmers themselves would not directly benefit from this FAO-administered fund, which would be disbursed to governments. In any event the fund failed on account of the lack of contributions. In May 1992 the Conference for the Adoption of the Agreed Text of the Convention on Biological Diversity (Nairobi Final Act) adopted Resolution 3 on ‘The Interrelationship Between the Convention on Biological Diversity and the Promotion of Sustainable Agriculture’. This recognized the need ‘to seek solutions to outstanding matters concerning plant genetic resources … in particular: (a) Access to ex situ collections not acquired in accordance with this Convention; and (b) The question of farmers’ rights’. In 1993, CPGR Resolution 93/1 called for the IUPGR to be revised in harmony with the CBD. To this end, the Commission, now called the
40 Knowledge, Property and Trade Commission on Genetic Resources for Food and Agriculture (CGRFA), held a series of negotiations to revise the IUPGR. Protracted discussions progressed, albeit slowly, at several extraordinary sessions of the CGRFA, and at a series of contact group meetings convened by the Chair of the CGRFA. These negotiations were finally concluded in November 2001, when a text for the revised IUPGR was adopted and then converted into a legally binding treaty, named the International Treaty on Plant Genetic Resources for Food and Agriculture. Recognizing both the sovereign rights and the inter-dependence of countries over their plant genetic resources for food and agriculture, the International Treaty establishes a multilateral system that aims to facilitate access and benefit sharing. So far the countries involved in the negotiations have agreed on a list of approximately 60 crops and forages which will be included in the multilateral system and, as such, will be made available to all countries free of charge or at cost. It is likely that the list will grow as countries become more confident in the effective functioning of the system. The ex situ collections held in trust by the International Agricultural Research Centres of the CGIAR are also to be incorporated into the multilateral system. Access and benefit sharing are to be regulated principally by means of a standard material transfer agreement (MTA), which will apply also to transfers to third parties and to all subsequent transfers. One of the most controversial parts of the Treaty is Article 12.3(d), which states that ‘recipients shall not claim any intellectual property or other rights that limit the facilitated access to the plant genetic resources for food and agriculture, or their genetic parts and components, in the form received from the Multilateral System’. Such an undertaking is to be provided in the standard MTA adopted to regulate the facilitated access. Japan and the US opposed this language and abstained from the vote on the adoption of the Treaty, although the US has since signed. What exactly is the issue here? In some legal jurisdictions, it is possible to patent DNA sequences and chemical substances that have been isolated from plant material without any structural modification. Therefore a patent holder could restrict – subject to possible research exemptions – use of the protected sequence or compound by others, and even access if the patent covered the method of isolation. To some developed countries, allowing such patents is necessary to encourage innovation and disclosure of the ‘invention’. But to many developing countries (and even some developed countries), these patents legitimize misappropriation of resources to which they have sovereign rights, and are contrary to the spirit of an international agreement that emphasizes exchange rather than appropriation. Article 13(d) of the International Treaty requires that ‘a recipient who commercializes a product that is a plant genetic resource for food and agriculture and that incorporates material accessed from the Multilateral System, shall pay to [a financial mechanism to be established] an equitable share of the benefits arising from the commercialization of that product, except whenever such a product is available without restriction to others for further
The International Law of Biogenetic Resources and Intellectual Property 41
research and breeding, in which case the recipient who commercializes shall be encouraged to make such payment.’ In effect, this means that a recipient that sells a food or agricultural product incorporating material from the multilateral system must pay monetary or other benefits from commercialization under the following circumstance: that he/she owns a patent on the product and – as is normally the case – there is no exemption in the patent law of the relevant jurisdiction that would freely allow others to use it for further research and breeding. If the product is a plant variety protected under a UPOV Convention-type system with such a research exemption, the recipient selling the product would be encouraged to pay benefits. The Treaty does not define farmers’ rights and leaves it up to national governments to give effect to these rights as they see fit. Article 9 refers to three measures that governments should take to protect and promote them. These are: ‘(a) protection of traditional knowledge relevant to plant genetic resources for food and agriculture; (b) the right to equitably participate in sharing benefits arising from the utilization of plant genetic resources for food and agriculture; and (c) the right to participate in making decisions, at the national level, on matters related to the conservation and sustainable use of plant genetic resources for food and agriculture. While none of these is necessarily IPRrelated, the last paragraph of Article 9 points out that ‘Nothing in this Article shall be interpreted to limit any rights that farmers have to save, use, exchange and sell farm-saved seed/propagating material, subject to national law and as appropriate.’
Part 2
CONFLICTS AND CONTROVERSIES
Chapter 4 NATIONAL SOVEREIGNTY, BENEFIT SHARING AND THE PATENTING OF LIFE
As we saw earlier, the Convention on Biological Diversity (CBD) affirms that ‘States have sovereign rights over their own biological resources’. What does this have to do with intellectual property (IP)? Consider the following scenario, which seems quite common and should show how the two are linked, at least as far as many critics are concerned. A substance is taken from a country and a foreign patent is granted claiming the substance or a close derivative. The substance is not acquired in accordance with the provider country’s access regulations, and the patent owner has made no legal commitment to share the benefits from commercialization.1 In addition, the country granting the patent imposes no requirement that the owner should share benefits with the provider country either at the point of patent grant or commercialization. How have the Convention’s terms been violated? Arguably in three ways. First, the patent ownership itself can be said to conflict with the sovereign rights of states over their natural resources. Second, the owner inventor, company, university or research agency has broken the law in the provider country by failing to agree to share benefits in accordance with its regulations. Third, the country granting the patent may be failing in its obligation under Article 15.7, which requires all state parties to take legislative, administrative or policy measures … with the aim of sharing in a fair and equitable way the results of research and development and the benefits arising from the commercial and other utilization of genetic resources with the Contracting Party providing such resources.
FAIR AND EQUITABLE As we have seen, one of the main objectives of the CBD is ‘the fair and equitable sharing of the benefits arising out of the utilization of genetic resources’. But what does ‘fair and equitable’ actually mean, and how might the phrase be operationalized? It may be worthwhile briefly discussing the terms ‘fair’ and ‘equitable’ in the present context, and consider what factors would
46 Conflicts and Controversies need to be taken into account in order for an action reasonably to be deemed unfair or inequitable. Byström, Einarsson and Nycander (1999) conducted an important study on this matter, in which they noted that ‘according to Webster’s New Collegiate Dictionary the words “fair” and “equitable”, along with related terms such as “just” and “impartial”, have a shared meaning element: “free from favour toward either or any side”’. Nuances in the meaning of the words are described as follows: ‘Fair’ implies an elimination of personal feelings, interests, or prejudices so as to achieve a proper balance of conflicting needs, rights, or demands. ‘Equitable’ implies a less rigorous standard than ‘just’ and usually a fair and equal treatment of all concerned. (‘Just’ implies a precise following of a standard of what is right and proper.) (Byström, Einarsson and Nycander, 1999, p20). Two of the examples offered are ‘the judge’s decision was absolutely fair’ and ‘a form of society which will provide for an equitable distribution of … riches.’ The authors offer some tentative criteria for assessing whether benefits are fair and equitable (Byström, Einarsson and Nycander, 1999, p27). Thus, the benefits: •
• • • • • •
• •
should contribute to strengthening the situation of the less powerful party/parties at all levels in the sharing relation, including by enabling: – equal access to information, – effective participation by all relevant stakeholders, – capacity building, – privileged access to new technology and products; should contribute toward, or as a minimum not counteract, the two other objectives of the Convention: conservation of biological diversity and the sustainable use of its components; must not interfere with existing forms of fair and equitable benefit sharing, including customary benefit sharing mechanisms; must respect basic human rights; must respect value and legal systems across cultural borders, including customary law and indigenous intellectual property systems; must allow democratic and meaningful participation in policy decisions and contract negotiation by all stakeholders, including stakeholders at the local level; must be transparent enough that all parties understand the process equally well, especially local and indigenous communities, and have time and opportunity to make informed decisions (effective prior informed consent – PIC); must not unnecessarily restrict access to non-rival goods and resources; must, if contractual relations are involved, include provisions for independent third party review to ensure that all transactions are on mutually agreed terms (MAT) and preceded by PIC;
National Sovereignty, Benefit Sharing and the Patenting of Life 47
• •
must, if contractual relations are involved, provide for identification of the origin of genetic resources and related knowledge; must, if contractual relations are involved, make information about agreed terms publicly available.
Without going into a detailed discussion on the feasibility of such criteria, it is reasonable to point out that apportioning the benefits and determining the beneficiaries on the basis of fairness and equity is not always an easy task or one on which a consensus could easily be reached in each case, even with unlimited goodwill on the part of all parties. To illustrate this point, in the 1950s the rosy periwinkle (Catharanthus roseus), a plant originally found in Madagascar, yielded two anti-cancer alkaloids, vincristine and vinblastine, which have generated huge profits for Eli Lilly since they came onto the market around four decades ago. To some, this is the classic biopiracy case with Madagascar and its people the unfortunate victim (Stone, 1992). In fact, while the plant is thought to originate from Madagascar, it exists throughout the tropics and has grown in the Caribbean for long enough to be considered as a native plant there (Morton, 1977, p237). It is many years since the company relied on Madagascar for supplies of the plant, and most now come from plantations in Texas. As for the ethnobiological knowledge, information on the use of the plant for medicinal purposes that attracted Eli Lilly researchers, and those at the University of Western Ontario who also discovered the anti-cancer properties of the plant, came not from the island state at all, but from the Philippines and Jamaica. In both countries, the plant was used by rural communities not to treat cancer but diabetes.2 So who, if anyone, should Eli Lilly share the benefits with in accordance with the principles or fairness and equity, and in what proportions? It would be difficult to make a convincing case that Madagascar should get anything. Nonetheless, it is reasonable to ask whether the patent system skews the distribution of benefits in ways that are unfair and inequitable. According to Jeff Kushan, former US negotiator on trade, intellectual property rights (IPR) and the Convention on Biological Diversity (CBD), ‘patents shield the collective interests of all participants’.3 Accordingly, patents may be necessary to ensure that commercial benefits can be shared fairly and equitably between all parties. What are the grounds for believing this to be the case? The main argument is that patents, as with other kinds of property, provide exclusive rights that allow markets for certain things, in this case valuable information in the form of inventions, to operate where they otherwise could not do so. As Geroski puts it, ‘patents are designed to create a market for knowledge by assigning propriety rights to innovators which enable them to overcome the problem of nonexcludability while, at the same time, encouraging the maximum diffusion of knowledge by making it public’ (1995, p97). The public goods justification for patents posits that such rights are likely to have various beneficial effects. Several economists and others have countered convincingly that knowledge is not exactly like other public goods and that such justifications need to be qualified (see David, 1993, pp27–28). Persuasive as these counter-arguments may be, let us for the sake of argument accept that knowledge is a public good.
48 Conflicts and Controversies Accordingly, two such beneficial effects should be mentioned here. The first is that patents encourage investment in invention and the research and development (R&D) needed to turn inventions into marketable innovations. The second – and this takes us back to Kushan’s point – is that the partners to, say, bioprospecting agreements, can exploit the market value of an invention in ways they could not do without a patent. How would this work? Ownership of the patent could be shared, or it could be held by one party on behalf of the others through an arrangement that all would benefit from successful appropriation of the patent’s market value, either by developing a product or selling or licensing the patent to someone else interested in developing it. Since many innovations and patents are dependent upon earlier patents, it is conceivable also that the patent could be used to engage profitably in transactions with follow-on innovators. So much for the theory. What about the practice? In reality, while patents could indeed shield the collective interests of all partners and no doubt often do, when it comes to bioprospecting this very rarely happens.4 Why is this? In cases where an indigenous community is one of the partners, one problem is that indigenous peoples tend to have a weak bargaining position due to poverty and their inability to assert whatever legal rights they have under national law. This makes it easy to exploit them. Another possible reason is that private sector interest in the screening of plants on the basis of ethnobotanical information may be quite limited, and a lot less than many NGOs assume to be the case.5 As for states that provide resources, the problem for them is that once these have been taken outside the country without their authorization, it becomes very difficult for them to control their use. But it can also be argued that certain features and trends in patent law itself are also responsible, and it is to this matter that the discussion now turns. One can identify two closely related issues that potentially, and almost certainly in reality, make the patent system unhelpful in promoting fair and equitable benefit sharing, and may also, arguably, cause conflicts with the CBD’s sovereignty principle. These are the extension of patents to substances discovered in nature, and the problem of patents being granted that would not be if the novelty and inventive step criteria were properly applied. The latter is a particularly serious problem in many countries, including the US and Japan.
PATENTING NATURAL PRODUCTS In Europe and North America, where there is the most experience in the patenting of such apparently natural substances, there has never been any kind of blanket exclusion of inventions based on the argument that only something that is 100 per cent human-made can be an invention. For example, adrenaline was first patented in 1903,6 and insulin in 1923.7 Shortly after the Second World War, Merck was granted patents on two products extracted from a microorganism called Streptomyces griseus: the antibiotic streptomycin and vitamin B128 (Dutfield, 2003, p116). While there was a general assumption that living
National Sovereignty, Benefit Sharing and the Patenting of Life 49
things could not be patented, patents were occasionally granted in some countries on plants and micro-organisms. But for most of the 20th century, the legal situation in Europe and North America was uncertain. From the 1970s, however, things became clearer as the scope of patent protection was extended not just to micro-organism products but to micro-organisms themselves, followed later by DNA sequences, plants and plant parts, and animals (see also Chapter 2). How can such ‘natural’ products, some of which are obviously discoveries, be protected by patents as if they are inventions? The technical explanation is that patent law treats them as if they are chemical substances, and these have been patentable for at least 150 years. It is well established in the patent laws of Europe and North America that, while you cannot claim as an invention something as it occurs in nature, it is possible to do so if you extract it from nature and thereby make it available for industrial utilization for the first time. This argument may not always convince a patent examiner or a court, however. But you almost certainly will have a convincing argument if you change the substance or life-form in some way, such as by adding something to it (for example a gene), subtracting something from it (by purifying it), mixing it with something else to create a new or synergistic effect, or structurally modifying it so that it differs in an identifiable manner from what it was before. The European Patent Office (EPO) Guidelines for Examination state that: if a substance found in nature has first to be isolated from its surrounding and a process for obtaining it is developed, that process is patentable. Moreover, if the substance can be properly characterized either by its structure, by the process by which is it obtained or by other parameters … and it is ‘new’ in the absolute sense of having no previously recognized existence, then the substance per se may be patentable.9 It may not be obvious to everybody that allowing patent claims to cover natural substances that have been isolated, purified or merely just described for the first time in chemical terms and found to be useful is necessarily a bad thing, at least as far as benefit sharing is concerned. On the other hand, experience shows that patents do legitimize the monopolization of benefits in the hands of single institutions or firms in cases where access regulations are lacking or are not complied with, and are not supported by complementary measures in the countries where genetic resources are used for commercial ends. To say this, however, is not to argue that the patenting of biochemical substances or living things should therefore be prohibited, but to show that certain perverse consequences are likely to arise.
PATENT QUALITY PROBLEMS As the volume of patent applications rapidly increases each year and the ability of national and regional patent offices to process them properly becomes an
50 Conflicts and Controversies ever more acute concern, the granting of patents for ‘inventions’ that appear in effect to privatize parts of the public domain has become a huge controversy that has brought the whole patent system into serious disrepute. So the problem caused by patent rules allowing discovered natural substances to be protected is compounded by the increasing numbers of patents being granted for ‘inventions’ that lack novelty and an inventive step and are essentially reformulations of existing knowledge with claims covering products that differ minimally, if at all, from those that already exist. The US Patent and Trademark Office in particular has been severely condemned for its granting of patents that should have been rejected and for turning the patent system into what, to the outsider, appears almost to be a quasi-registration system. In addition, the law in the US is that undocumented knowledge held only in foreign countries does not form the state of the relevant art.10 Although an applicant is not allowed to receive a patent if ‘he did not himself invent the subject matter sought to be patented’,11 there are concerns that this loophole, which to be fair is not unique, sometimes allows people to copy such undocumented foreign knowledge and claim they have come up with a new invention.12 The notorious patent on the use of turmeric powder for wound healing13 granted to the University of Mississippi Medical Center may be an example of this.14 The patent provoked considerable anger in India because such use of turmeric was common knowledge there. Yet the Indian government agency that challenged the patent had to do more than persuade the US Patent and Trademark Office that this was true. It had to provide published documentation, and by doing this the patent was revoked (Ganguli, 2001, p156). Yet the patent should never have been granted in the first place. Many such patents do not really do any harm except to waste the time of patent examiners.15 But some are potentially harmful and others are actually harmful. Two potentially harmful patents are associated with a plant related to mustard called maca (Lepidium meyenii). Maca, sometimes dubbed ‘natural viagra’, is a traditional crop that Andean populations have cultivated for centuries for use as a food and as the basis for several medicinal formulations. One of the US patents, owned by Pure World Botanicals Inc., is for an isolated maca extract which, it is claimed, can be used to treat cancer and sexual dysfunction, as well as the process of preparing it.16 The latter use is already well known. Indeed, the company has for several years been importing maca into the US and selling it for this very purpose (ETC Group, 2002). The other patent, which is owned by Biotics Research Corporation,17 covers a mixture of powdered maca and antler and the process of increasing testosterone levels in men by administering this mixture in various forms. The consumption of both maca and antler is already known to be associated with increased testosterone levels. This casts doubt on whether the company has a genuinely patentable invention. Suggestions that Peruvian maca farmers depending on exports could be harmed by these patents are speculative. However, the enola bean patent, described in Chapter 5, shows how actual harm may be caused by an improperly awarded patent. Evidently, it is easier than it should be to receive a patent. This is because in many countries, and the US is a very good example of this, the examination
National Sovereignty, Benefit Sharing and the Patenting of Life 51
process is not as thorough as it should be. This is largely because too few examiners are handling too many applications with the result that a lot of bad quality patents are being issued. It would be wrong to make scapegoats out of the patent examiners for this unacceptable state of affairs. Like World Cup referees who can hardly meet the impossibly high competence standards expected of them in the face of rampant gamesmanship and cheating by players, we should rather blame the system and its many unscrupulous users whose behaviour makes their work so difficult if not impossible. Given the controversies in other fields like software and business methods, the cases described are clearly not isolated ones. We are not dealing with the odd bad patent. The problem seems to be systemic.
Chapter 5 BIOPIRACY
The issue of biopiracy has become highly contentious and seems to have played a catalysing role in the introduction of access legislation in some developing countries (see Chapter 13). The word ‘biopiracy’ is applied somewhat loosely to the extent it is not always clear who the victims actually are, or if indeed there are any.1 But it normally refers either to the unauthorized extraction of biological resources and/or associated traditional knowledge from developing countries, or to the patenting of spurious ‘inventions’ based on such knowledge or resources without compensation. Developed world companies, and also academic and public sector scientists, are increasingly accused of stealing or ‘pirating’ the knowledge of indigenous peoples through the act of acquiring patents. Critics of such practices complain that the patent and plant variety protection (PVP) systems are being used to misappropriate traditional knowledge and that such practices are not only immoral but are also a violation of the human rights of the people whose knowledge is being pirated. This chapter investigates this controversy by addressing four questions. First, can patents and PVP legally appropriate traditional knowledge? Second, what duties, if any, do the holders of these rights have to members of indigenous communities whose knowledge contributed to the patented invention or plant variety? Third, is such patenting inherently exploitative? And fourth, if it is not, at what point might use of the patent system in this context become exploitative? We start the investigation by considering some real cases of alleged biopiracy.
THE HOODIA CASE Certain groups of San (Bushmen) people (inhabiting the Kalahari desert of Southern Africa), known as Khomani, eat parts of a plant called hoodia as an appetite suppressant. This helps them to endure long hunting trips in areas of the desert where food is scarce. The practice was noticed by South African soldiers who used Khomani people as trackers during the 1980s when Namibia was fighting for its independence (Kapner, 2002). The South African Council for Scientific and Industrial Research (CSIR), a government institution,
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investigated the plant and patented certain compounds possessing appetite suppressant activity. The CSIR has high hopes that it will form the basis of a successful anti-obesity treatment and will become Africa’s first blockbuster drug. A British company, Phytopharm is now involved in developing the drug in the hope of turning it into a product for the US and European markets. There are hopes that its sale will be approved by 2008 (Chennells, 2003). The patent specification may well provide the first biochemical description of how the plant produces its commercially promising effect.2 But the intended use of the plant would hardly be considered as novel by the Khomani, who are not mentioned at all in the patent. Ironically, the head of Phytopharm was reported as saying about the Khomani that ‘the evidence seems to show that they used the plant as a food supplement and didn’t even think about obesity’ (Kapner, 2002). Following an investigation by a South African activist, Rachel Wynberg, and a subsequent newspaper exposé, the CSIR and the two companies found themselves criticized by international NGOs and also by a San organization called the Working Group on Indigenous Minorities in Southern Africa (WIMSA). The main criticism was that none of the partner organizations had, at any time, seen fit to contact the San to explain the situation and enter into negotiations with them on the sharing of benefits. In 2001, the CSIR responded by negotiating a memorandum of understanding, which led in 2003 to a benefit sharing agreement that sets up a ‘San Hoodia Benefit-Sharing Trust’. The Trust will receive milestone payments and royalties from the CSIR, to be distributed to the San people (Chennells, 2003).
THE NEEM PATENTS The neem tree (Azadirachta indica) has been the subject of a considerable number of patents, with more than 40 in the US alone and at least 150 worldwide. The inventions described in virtually all of the neem-related patents used public domain traditional knowledge as a starting point. They have aroused considerable controversy, especially in India, where most of the traditional knowledge holders originate. There have been at least two patent challenges: (1) to a European Patent Office (EPO) patent for the fungicidal effects of neem oil (Patent No. 436 257 B1) owned by W. R. Grace & Co., and (2) to a US patent for a storage-stable azadirachtin formulation (Patent No. 5124349) also owned by W. R. Grace. The challenge to the former patent succeeded in 2000 when the EPO revoked the patent on the grounds of lack of novelty and inventive step.
THE QUINOA CASE The quinoa patent is an example of how the breadth of a patent’s claims may appear to encompass not just new varieties but traditional plant varieties as well. Quinoa (Chenopodium quinoa) is a highly nutritious drought-resistant food crop
54 Conflicts and Controversies grown in the cold high-elevation regions of the Andean countries of South America. Indigenous communities in Bolivia and Peru have bred numerous varieties, including Apelawa, named after a village in Bolivia. Although it is a little-known food outside these countries, there is a growing demand for quinoa among health-conscious Europeans and North Americans, and industrial plant breeders have started to take an interest. In order for plant breeders to produce hybrids from self-pollinating quinoa plants, the male properties of one parent must be eliminated so that plants of two different varieties do not fertilize themselves, as well as each other, leaving progeny that are mixtures of the hybrid and the two parental varieties. Use of male sterile plants in the breeding of hybrids can avoid the labour intensive work of removing anthers from plants. In April 1994, a US patent was awarded for Cytoplasmic Male Sterile Quinoa. The patent accepts that male sterile quinoa lines have been reported in the literature, but the specification claims that ‘a reliable system of cytoplasmic male sterility has not been reported, and cytoplasmic male sterile plants have not heretofore been available for commercial production of quinoa hybrids’. The patent states that ‘the cytoplasm conferring the property of male sterility is derived from the Apelawa variety of quinoa’. However, in an Internet exchange between one of the named inventors, Professor Sarah Ward, and Pat Mooney of Rural Advancement Foundation International (RAFI), the former states that she found the cytoplasm in question in quinoa plants of the Bolivian Apelawa variety growing in a field in Colorado, US. The cytoplasm, she argued, does not exist in quinoa plants growing in South America but had been transferred naturally from a related weed species growing nearby (in Colorado). This was not made clear in the patent. Consequently, the failure to indicate the non-Bolivian provenance of the cytoplasm inducing male sterility or to refer to its discovery made it possible to interpret the patent very broadly in ways the inventors may not have intended. For example, the first two patent claims were for a quinoa seed of the variety Apelawa having male sterile cytoplasm and a quinoa plant produced from this quinoa seed. Although it is difficult to see how Andean farmers could be directly affected by the patent – since the existence and value of quinoa plants with the male sterility characteristic were known to many traditional cultivators – it was understandable that those farmers exporting quinoa to the US would feel threatened by these claims. An international campaign involving RAFI and Bolivia’s National Association of Quinoa Producers, calling for Colorado State University to let the patent lapse, was successful when, in May 1998, Professor Ward admitted that it had been abandoned.
THE ENOLA BEAN CASE In 1999, a US patent was granted on a field bean cultivar dubbed ‘Enola’ by its ‘inventor’, Larry Proctor.3 Proctor’s company, Pod-Ners, has been using the patent to block the sale of imported beans with the same colour as the one described in the patent, whose description would cover several – not very novel – traditional bean varieties. The patent claims not only a certain yellow-coloured
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Phaseolus vulgaris bean seed, plants produced by growing the seed as well as all other plants with the same physiological and morphological characteristics, but also the breeding methods employed. Two things are extraordinary about this patent. The first is that many bean cultivars exist and the specification provides no evidence that none of these cultivars possess the same characteristics falling within the patent’s rather broad claims.4 The second is that Mr Proctor employed conventional crossing and selecting breeding methods that are in no way novel. Yet the patent prevents others from using the bean and other beans with similar characteristics in their own breeding programmes. None of this would necessarily matter if the owner had not decided to assert the patent aggressively. Soon after receiving the patent, Proctor sued a company called Tutuli that had been importing Mexican yellow bean cultivars called Mayocoba and Peruano from that country since 1994, and, with customs inspectors disrupting supplies, Tutuli began to suffer financially as did Mexican farmers who had been selling their beans to this firm. Proctor’s company has since filed lawsuits against various other small bean companies and farmers. The patent is being challenged by the International Center for Tropical Agriculture (CIAT), which holds the largest collection of bean varieties and claims that six of its 260 yellow bean accessions very closely resemble Enola and may well fall within its claims. CIAT’s Director, Dr Joachim Voss, reportedly called the patent ‘both legally and morally wrong’ and claimed to have ‘solid scientific evidence that Andean peasant farmers developed this bean first, together with Mexico’ (quoted in Pratt, 2001). But according to one report, the patent owner intends to get revenge on Mexico if he loses: ‘Proctor warns that if his patent is reversed he’ll flood the Mexican market with beans, depressing an already-weak bean price’ (quoted in Carlsen, 2001). The enola bean case illustrates how a mistakenly granted patent causes problems when an owner acts aggressively to defend it. In this case, the consequence included the closure of a market for producers of traditional varieties from the exporter country.
‘BIOPIRACY’ THROUGH PLANT VARIETY PROTECTION The misappropriation of folk varieties is certainly possible and may be facilitated by the fact that distinctness and novelty standards may be insufficiently demanding to prevent the registration of extant varieties. Given that professional breeders can be expected to have far greater financial resources, legal experience and scientific facilities than local communities, there is a danger that traditional cultivars will be misappropriated with minimal, if any, modification. For example, in 1998, the Canadian NGO ETC Group (then known as RAFI) claimed to have uncovered 147 cases of mostly public institutions seeking PVP for varieties acquired from the CGIAR (Commission on Plant Genetic Resources) network (RAFI, 1998a, 1998b). Many of these varieties, it was alleged, are landraces that have been subjected to little, if any, additional breeding.
56 Conflicts and Controversies The novelty criterion makes clear that varieties cannot be protected if they have been previously placed on the market by others. Given the relative ease of acquiring plant variety rights as compared to patents, the less rigorous novelty criterion, and the fact that there is no prior art search, it is possible for a landrace (or a variety resulting from a mere ‘cleaning’ of a landrace) to slip through the net. However, given the general lack of commercial potential for landraces and their immediate derivatives, this is probably not a significant concern, especially when we consider that the vast majority of the tens of thousands of plant variety titles in force worldwide are the result of breeding work done on commercial varieties by a previous generation.
RIGHTS AND WRONGS Defenders of strong patent systems are likely to argue that companies holding patents derived from knowledge acquired from local communities cannot prevent members of these communities from continuing to use their knowledge, and moreover such companies have never attempted to do so. For example, just because a US company holds a patent for, say, a stable storage form of neem pesticide, this does not prevent Indian farmers from continuing to use neem as a pesticide as they have done for generations. Defenders may also assert that, as long as the patent requirements of novelty, inventive step and industrial application are strictly upheld by patent offices, there is no reason for local communities to feel exploited since, if their knowledge were simply copied, there would be no invention to patent. The hoodia example could be deployed to support this case. Both of these arguments are reasonable except that the quinoa and enola bean examples, and the turmeric and maca cases described in Chapter 4, show how the theory and practice of patenting differ. In those cases, patents claiming traditional knowledge within their scope were granted. In the enola case, the patent owner abused his right by restraining trade in old products. On the other hand, while the meaning of novelty might appear to be rather clear cut, it is to some extent a relative term, especially when viewed from a cross-cultural perspective. This was nicely explained by Lord Hoffman of the British House of Lords in a 1995 patent appeal case: There is an infinite variety of descriptions under which the same thing may be known. Things may be described according to what they look like, how they are made, what they do and in many other ways. Under what description must it be known in order to justify the statement that one knows that it exists? 5 Hoffman went on to use the example of quinine: The Amazonian Indians have known for centuries that cinchona bark can be used to treat malarial and other fevers. They used it in the form of powdered bark. In 1820, French scientists discovered that the active ingredient, an alkaloid called
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quinine, could be extracted and used more effectively in the form of sulphate of quinine. In 1944, the structure of the alkaloid molecule (C20H24N2O2) was discovered .... Does the Indian know about quinine? My Lords, under the description of a quality of the bark which makes it useful for treating fevers, he obviously does. I do not think it matters that he chooses to label it in animistic rather than chemical terms. He knows that the bark has a quality which makes it good for fever and that is one description of quinine. On the other hand, in a different context, the Amazonian Indian would not know about quinine. If shown pills of quinine sulphate, he would not associate them with the cinchona bark. He does not know quinine under the description of a substance in the form of pills. And he certainly would not know about the artificially synthesised alkaloid.6 The hoodia patent case exemplifies this point, as do the patents relating to maca, and another one based upon Phyllanthus niruri, a medicinal plant used in India for treating various ailments including jaundice, which was discovered in tests to show effectiveness against viral hepatitis-B and E. The Fox Chase Cancer Center, which had carried out these tests, was awarded a US patent7 for a pharmaceutical preparation comprising an extract of the plant. While the invention was sufficiently new, useful and non-obvious to be patentable, Indian Ayurvedic healers are unlikely to be as impressed as the Patent and Trademark Office examiner who granted the patent. So it seems that, while a plant or animal extract or mixture of extracts known by an indigenous group to have a useful characteristic cannot be patented due to its lack of novelty, the achievement of being first to explain the extract’s effectiveness by way of some tests, by describing its mode of action in the language of chemistry, or even by just modifying the mixture in some modest way seems to be sufficient in some jurisdictions to merit the award of a patent. Often such patents make no reference to the relevant traditional knowledge (eg the hoodia patent) or merely mention it in a cursory manner as if it is of little importance (eg the turmeric patent). Under these circumstances, it is not really surprising that indigenous groups believe the patent system to be exploitative and predatory. This is hardly an ideal state of affairs for industry either. Such patents make it much harder for trusting relationships to be developed between indigenous groups and researchers and businesses that could benefit all parties. The business sector generally fails to take this problem seriously except for issuing the occasional public statement.8 The fact that some companies get attacked even when they sincerely try to do the right thing does not excuse the passive stance of these corporations, many of which continue to abuse the patent system by seeking – all too often successfully – to patent the unpatentable, and by stretching out their patent monopolies on money-spinning drugs for periods that are sometimes far longer than is reasonable.9 But what of morality and human rights? An article by Stenson and Gray (1997), took the position that moral entitlement theories do not justify indigenous peoples’10 intellectual property rights (IPRs) over their knowledge. The problem with their analysis is that they based it on a simplistic conception
58 Conflicts and Controversies of traditional knowledge, assuming that it is, by definition, collectively held and generated and part of the public domain.11 This makes their argument appear more plausible than it should. To argue that traditional knowledge when defined this way should enjoy a privileged legal status vis-à-vis other public domain knowledge originating from non-traditional sources, such as public or private sector research programmes, does indeed prima facie seem problematic from a moral entitlement-based perspective. However, what should not be overlooked is the question of how traditional knowledge usually falls into the public domain. Indigenous peoples have for centuries endured abuses of their basic human rights, and they still tend to be politically, economically and socially marginalized. It would, therefore, be naïve to suppose that it has ever been normal practice for their knowledge to be placed in the public domain and disseminated, with their prior informed consent and with respect for their customary laws and regulations concerning access, use and distribution of knowledge. It can plausibly be argued, then, that unconsented placement of knowledge into the public domain does not in itself extinguish the legitimate entitlements of the holders and may in fact violate them. Second, while Stenson and Gray’s argument is relevant to cases of widely distributed and long-documented traditional knowledge such as that related to neem, a great deal of knowledge is more localized in its distribution and may be held only by small numbers of people or even an individual. Third, it is unreasonable to suggest that indigenous peoples have no reason to complain as long as their knowledge is not directly copied in a patented invention. For example, the outrage felt by many South American indigenous peoples about the US plant patent on a sacred plant, ayahuasca, is legitimate. Nevertheless, Stenson and Gray (1997) usefully demonstrate that advocates of indigenous peoples and local communities’ rights need to be consistent in their argumentation.12 For example, let us assume that the traditional knowledge about neem had been forgotten by most Indians so that only a few farmers still held the knowledge. Would the use of their knowledge by a company as a lead for a patented invention make these people victims of intellectual piracy? If the farmers were identifiable, one could possibly build a strong case that the company’s act was economically exploitative by using some of the arguments provided earlier. But – unlike the quinoa case – it is more difficult to argue that it is intellectual piracy. This is because, to be consistent, one would also have to argue that a temporary monopoly right to an incremental improvement (which is what a patent essentially is) is inherently exploitative of all people, past and present, who had contributed to the state of the art (or more accurately all the states of the arts) relevant to the patent. Such a position is difficult to sustain and is highly inappropriate in this case (see Menon, 1993). The state of the art includes not only the knowledge that neem seed extracts are an effective pesticide, but also the industrial techniques that can be applied to produce neem derivatives that are in one way or another more useful than the natural product.13 Following a more critical perspective, it is tempting to draw an analogy between the taking of indigenous peoples’14 knowledge without permission and patenting inventions based upon this knowledge, and seizing their territories and displacing them from their homelands. In each case, it seems
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that territories, ecosystems, plant varieties (whether domesticated or not) and traditional knowledge, are treated as if they are res nullius (the property of nobody) before their ‘discovery’ by explorers, scientists, governments, corporations and conservation organizations (Dutfield, 1999). During the Colonial period, sparsely populated ‘wildernesses’ were regarded as being, to all legal intents and purposes, vacant prior to colonization.15 Settler societies, such as in Australia, built up legal systems based upon the terra nullius (the land of nobody) doctrine.16 According to such a view, open access is the rule for land, traditional knowledge and resources, whereas enclosure is the rule as soon as these are proved to have economic value. The analogy is powerful and persuasive even if it is conceded that, whereas lands and territories are finite, new knowledge is constantly being generated and is, at least in theory, inexhaustible. Nevertheless, the analogy does seem to reflect indigenous peoples’ views – based as they are upon bitter historical experience – more accurately than the conventional (and Western) arguments favouring IPRs for holders of useful knowledge. Also, it accurately reflects the sentiments of indigenous peoples who see Western law as an imposition that seems to negate their own custom-based regulations. After all, if indigenous peoples in World Trade Organization (WTO) member states are required to accept the existence of patents that they are economically prevented from availing themselves of, why shouldn’t their own knowledge-related regimes be respected by others? It is perhaps this point, that one type of IPR system is being universalized and prioritized to the exclusion of all others, which causes the most legitimate disquiet among those peoples and communities that are least able to benefit from what, to them, is an imposed system. It is of course reasonable to argue that if indigenous peoples are not affected by the Western IPR system, it can hardly be called an imposition. At least two immediate responses can be given. First, as we have seen, several countries (eg the US) do not recognize undocumented knowledge held abroad as prior art. This may encourage people simply to copy this knowledge and apply for a patent. Second, patents with overly broad claims, encompassing non-original products or processes are sometime mistakenly awarded. Due to poverty, most indigenous groups are in a weak position to challenge patents in the courts on the grounds that their knowledge or, say, folk varieties, have been fraudulently or erroneously claimed. Even if it is still debatable whether strong patent systems modelled on those of Europe or the US are inherently harmful to indigenous peoples and local communities, arguments that such systems reinforce existing injustices are persuasive. The question to be asked, then, is whether perverse characteristics of the system are integral to IPRs or whether they could be mitigated by rigorous patent examinations or by careful drafting of IPR laws. A strong argument can be made that IPR systems should be available to protect holders of all useful knowledge whose dissemination is beneficial to the wider public. To the extent that they cannot do this, they are inherently flawed. But, on the other hand, some defects could be corrected without necessarily having to make radical changes (see Chapter 11).
Chapter 6 ENVIRONMENTAL IMPACTS
Until the 1980s, few if any people considered intellectual property rights (IPRs) to have anything whatsoever to do with genetic erosion. This is not the case now. Critics maintain that IPRs provide perverse incentives which encourage activities that are prejudicial to biodiversity. Are they right? One way to investigate this issue is to frame it in the form of three sets of questions, which will be discussed in this chapter. These are as follows: 1 2 3
Do IPRs encourage the spread of monocultural agriculture? And if so, does this cause erosion of biodiversity? Do plant variety rights (PVPs) encourage the breeding of genetically uniform varieties and the use of a relatively small pool of genetic material? And if either of these is the case, is it prejudicial to biodiversity? Is the increasing production and sale of seed-agrochemical ‘packages’ (such as transgenic crops sold with pesticides and/or herbicides for which they have a built-in resistance) harmful to biodiversity? And if so, are IPRs an inducement for companies to produce these kinds of ‘package’? In other words, is this an IPR issue?
INTELLECTUAL PROPERTY RIGHTS AND MONOCULTURES With respect to the first set of questions, one of the most plausible critiques of IPRs is by Reid (1992), who identifies a strong connection between IPRs and a bias towards centralized research, and believes that this has an impact on agrobiodiversity. He finds that the prevailing policy framework for the use of genetic resources for food and agriculture favours ‘centralized crop breeding and the creation of uniform environmental conditions, and discourages agro-ecological research or local breeding tailored to local conditions.’ IPRs enhance incentives to develop seeds with a large potential demand. To ensure maximum demand for their products, the seed companies will tend to focus their research on commonly utilized high-value crops and develop varieties that can be cultivated
Environmental Impacts 61
as widely as possible. To do so means either breeding through selection of genes for maximum adaptability, or introducing the new seeds while also promoting farming practices that reduce environmental heterogeneity. The biodiversityerosive effects of this IPR-supported bias towards centralized crop breeding programmes are: decreased crop diversity; decreased spatial genetic diversity; increased temporal genetic diversity due to the need to replace cultivars with new ones every few years; and increased use of external inputs. It is important to point out that monocultural agricultural systems are not inherently biodiversity-erosive. It is true that they may cause biodiversity loss if they replace more biologically diverse ecosystems. But if a monocultural system produces higher yields per harvest and/or more harvests per year compared to the more polycultural agro-ecosystem it replaced, pressure to open up biologically diverse ecosystems to cultivation may be reduced as a consequence (though the opposite result is also possible). Kothari and Anuradha (1997) conclude that IPRs alone cannot be held responsible for the loss of agro-biodiversity, but that IPRs are bound to encourage the displacement of a wide diversity of traditional local varieties in favour of a small number of widely adapted hybrids and homogeneous modern varieties. Moreover, they point out that one of the lessons of the Green Revolution is that the development of new varieties by the seed industry is unlikely to match the loss of traditional varieties after the new varieties are introduced. It is important also to point out, however that this trend in crop breeding dates back to when the Green Revolution began, and earlier still in some countries. The varieties most commonly associated with the Green Revolution were developed by public crop breeding institutions, not corporations. On the face of it, this suggests that this may not be an IPRrelated problem at all. According to a preliminary study produced for the Secretariat of the CBD for consideration of the 3rd meeting of the COP (Conference of the Parties to the Convention on Biological Diversity) (CBD Secretariat, 1996a), other policies that might encourage the use of new crop varieties and the loss of landraces include: government farm credits and subsidies, and extension services; the policies and programmes of international agencies and donor institutions; the marketing and R&D policies and programmes of transnational corporations; and the increasingly concentrated corporate control of pesticide and agro-biotechnology research and distribution.
PLANT VARIETY PROTECTION AND GENETIC UNIFORMITY Rangnekar has argued that PVP encourages plant breeding based upon existing material already in scientific use, while providing ‘juridical legitimization to the breeding of genetically uniform varieties’ (2000a, p1). On what basis may such claims be credible?
62 Conflicts and Controversies Let us consider first the point that PVP encourages the use of a narrow pool of germplasm by crop breeders. What makes such a claim plausible is the breeders’ exemption, which, since it permits free use of plant genetic resources already in circulation, does little to encourage the discovery and input of resources that may exist in the fields of traditional cultivators and other types of ecosystem characterized by relatively high levels of biodiversity. Defenders of PVP may counter that the number of varieties introduced into European and northern markets is probably greater than it would have been without the incentive of a PVP system. On the other hand, an increased quantity of plant varieties being cultivated does not necessarily mean that agro-biodiversity is greater than would otherwise exist in farmers’ fields. This is because new varieties tend to be based on the recombination of genes acquired from a fairly limited gene pool shared by plant breeders, who generally do not claim exclusionary rights over discovered genes or plants into which they are inserted. Furthermore, Rangnekar claims that PVP rights encourage breeders to adopt strategies of planned obsolescence ‘to reduce the durability of plant varieties so as to induce regular replacement purchases by farmers’ (2000b, p1; 2002b). He claims some empirical evidence that UK wheat breeders do adopt such strategies. If we turn to the point about juridical legitimization, this relates to the fact that the International Union for the Protection of New Varieties of Plants (UPOV) PVP rules require individual plant varieties to be genetically uniform.1 Consequently, the genetic variability of each protected variety is quite limited as compared to folk varieties. In defence of UPOV, however, the trend towards cultivation of genetically uniform varieties is also due to the seed certification requirements of many countries, which can often apply more stringent uniformity standards than UPOV (Louwaars, 1999).
INTELLECTUAL PROPERTY RIGHTS AND CROP-AGROCHEMICAL LINKAGES With respect to the second set of questions, it is true that seed companies often develop hybrids and other modern varieties that depend upon applications of agrochemicals (such as fertilizers, herbicides and insecticides) to achieve high yields. A common accusation is that excessive use of these chemicals is encouraged and other plants growing nearby are killed as a result. However, IPRs are unlikely to be directly responsible for this trend in crop breeding, which dates back to the time when the Green Revolution began, and earlier still in some countries. The Green Revolution is frequently blamed for the development and spread, during the 1950s and 1960s, of high-yielding wheat and rice varieties requiring heavy applications of agrochemicals, but the varieties most commonly associated with the Green Revolution were developed by public crop breeding institutions and were not IPR protected. However, the IPR link appears stronger in the case of genetically modified crops. In recent years, life science corporations (often originally chemical
Environmental Impacts 63
companies that have bought seed companies) have increasingly been creating transgenic plants with built-in resistance either to herbicides marketed by the same company (see Bell, 1996; Kloppenburg, 1988) or to insect pests. In the former case, both the herbicide and the seed for which it is designed are likely to be patent protected. For example, Monsanto had made enormous profits from one of its patented agrochemicals, a glyphosate-based herbicide marketed under the name of Roundup, and was concerned to ensure that once the patent expired, it would not face too drastic a shortfall in revenues as competing producers of the same herbicide entered the market. Monsanto turned to biotechnology for a solution. The company developed and patented transgenic soybeans, canola, cotton and corn containing a gene providing resistance to its Roundup. Monsanto’s patents protect the gene for Roundup resistance and all plants containing it, and these have several more years to run. As farmers who buy these ‘Roundup Ready’ seeds are contractually obliged to purchase Monsanto’s patented herbicides, sales of the seeds are good for sales of the herbicides and vice versa. It is unclear, however, that this strategy will work in the long term. Roundup Ultra went off patent in 2000 and farmers may well turn to cheaper versions sold by competitors. An example of a crop with built-in resistance to a pest (rather than a herbicide or pesticide) is Monsanto’s NewLeaf potato, which claims to provide total protection against the Colorado beetle (Magretta, 1997). Another is Novartis’ patented Bt corn, which is designed to resist the European corn borer pest. The position of the large life science corporations such as Monsanto and Novartis is that genetic engineering can reduce or even obviate pesticide use. Monsanto’s claim is that when they produce packages of herbicides and plants resistant to these herbicides, their aim is not to ensure that farmers will need to increase herbicide use. Their main interest is to ensure that farmers use their herbicides. If these are more effective than alternative products, overall herbicide use may decrease. According to the company, ‘Roundup herbicide can reduce the number of weed treatments and can also help reduce tillage to conserve soil moisture and reduce erosion of valuable topsoil.’2 Environmentalists and some scientists counter that genetically engineered herbicide resistance has negative environmental effects.3 Among the claims commonly made are that use of herbicide-resistant transgenic plants may: encourage excessive use of herbicides which may kill other plant varieties and species (Bell, 1996); accelerate the development of resistance among pests (Jenkins, 1998); and create the possibility of herbicide-resistant genes crossing over to other plants, including the weeds being targeted. This could create ‘superweeds’ which would render the herbicide ineffective in the long term, and cause ecological impacts that cannot easily be predicted. It may also be possible that transgenic plants themselves could become ‘weeds’ if the added characteristic gives them a competitive advantage over neighbouring wild species (de Kathen, 1996), although this is unlikely in the case of the most highly domesticated crop species. Some critics also allege that herbicides are far more toxic than the manufacturer companies are willing to admit, and that the
Proximate causes
• Policies that support HYVs, uniformity and chemicals (subsidies, credit, market standards) • Demographic changes • Demographic changes • Disrespect for local knowledge and structural inequities
Heavy use of agrochemicals Poor tillage practices Use of monocultures Extensification in marginal land Drift/spillover from chemicals
• Replacement by uniform species
• • • • •
• Heavy use of pesticides • Use of monocultures • Loss of organic material
Demographic changes • Industrial/Green Revolution Model that stresses uniformity • Disparities in resource distribution and in control of land • Pressures and influences of seed/agrochemical companies • Policies that support HYVs, uniformity and chemicals (subsidies, credit, market standards) • Producers/companies focus on short-term returns to neglect of longer-term social factors • Disrespect for local knowledge and structural inequities • Policies that support HYVs, uniformity and chemicals (subsidies, credit, market standards) • Demographic changes
Underlying causes (for all problems)
Source: (derived from Thrupp 1997 [with changes suggested by Takase (pers comm 1998)])
Erosion of habitat diversity (social and private costs) Erosion of indigenous methods for using agrodiversity
Erosion of soil diversity • Leads to fertility loss • Productivity decline
Erosion of insect diversity
Erosion of genetic • Spread of High Yielding Varieties (HYVs) resources (livestock and and monocultures plants) • Biases in breeding methods • Leads to disease/ • Weak conservation methods insect pests • Loss of insect diversity
Problems
Table 6.1 Addressing causes of biodiversity losses linked to agriculture
64 Conflicts and Controversies
Environmental Impacts 65
health of both farmers and consumers could be affected (McNally and Wheale, 1996; Tappeser and von Weizsäcker, 1996). Concerns are also expressed that an increased use of hybrids and other modern varieties specifically designed for use with other proprietary agricultural inputs such as fertilizers and pesticides may have serious social impacts, especially in developing countries. These crop–herbicide–pesticide linkages can be considered to represent a shift towards capital intensive agriculture that increases the costs of farming and may therefore be detrimental to small farmers. Consequently, critics maintain that farmers must have the right to choose whether or not to accept these packages and should not be subjected to aggressive sales promotion campaigns or seed regulations that limit their freedom of choice. Even if we accept that these concerns are well founded, are IPRs implicated just because plants (whether transgenic or not), herbicides and pesticides can be patented? Corporations in these technological fields tend to claim that without IPR protection they would have no incentive to invent or to innovate. This suggests that these products would not exist without IPRs. But this does not mean that the national patent office is the appropriate place to deal with marketing approval for such products. Most countries have an agency with jurisdiction over such matters, and such a body is probably much better placed than the patent office to decide whether plant–herbicide–pesticide packages are in the public interest or not. In conclusion, there is a dearth of reliable empirical evidence on the IPR–genetic erosion connection. What can be presumed with some certainty is that the loss of agro-biodiversity cannot be attributed to a single cause. One study of the relationships between biodiversity erosion and agriculture came up with numerous proximate and underlying causes, but IPRs were not mentioned (see Table 6.1).
Chapter 7 AGRICULTURE, FOOD SECURITY AND NUTRITION
The term ‘food security’ applies to more than just ensuring that an adequate amount of food is cultivated or made available through the market. It also embraces the question of whether people can afford to buy or cultivate enough food to satisfy their basic nutritional requirements. If not, as is frequently the case throughout the developing world, it can be argued that food security is lacking. What is the connection with intellectual property rights (IPRs)? In the developed world, while plant biotechnologists tend to use the patent system, plant breeders have generally sought IPR protection for new plants, including new foodstuffs, through plant variety protection (PVP).1 The main point at issue is whether the international acceptance of common standards of PVP through the UPOV Convention, initially developed to meet the conditions in the advanced industrialized countries, and of patents on plants, are inappropriate for developing countries to the extent that they may have the effect of undermining food security. Concern has been raised that the UPOV system was drawn up by European countries, and is designed to accommodate the specific characteristics of the capital-intensive large-scale commercial agricultural systems that generally prevail in that continent. As a result, it is often argued, the system is unsuitable for most developing countries (see Gaia Foundation and GRAIN, 1998). Among such critics, the current system of IPR protection for plants has raised concerns over their impact on food security in three areas: PVP and research priorities; the interests of poor farmers; and the availability of genetic resources for further breeding.
PLANT VARIETY PROTECTION AND RESEARCH PRIORITIES Many resource-poor farmers cultivate minor food crops that enable them to meet the nutritional needs of their rural communities more effectively than if major crops such as wheat, rice and maize alone are cultivated. In the hills and
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valleys of Nepal, for example, villages may grow more than 150 crop species and cultivated varieties (Riley, 1996). However, the evidence so far suggests that PVP generally does not encourage breeding related to minor crops with small markets. This is because the returns on breeders’ research investment will be small. Rather, they encourage breeding targeted at major crops with significant commercial potential. Moreover, protected varieties of plants may not even be food crops. In Kenya, for example, until very recently, about half the protected new varieties were foreign-bred roses cultivated for export (see Chapter 12). It is conceivable, then, that PVP may contribute to a trend whereby traditional diverse agro-ecosystems, containing a wide range of traditional crop varieties, are replaced with monocultures of single agrochemical-dependent varieties, with the result that the range of nutritious foods available in local markets becomes narrower. Admittedly this trend is a global phenomenon whose beginning predates the introduction of PVP systems. Nevertheless it is one that the existence and increasingly widespread use of PVP may indirectly encourage. On the other hand, there is nothing to stop developing countries from encouraging research on minor crops that are important for local communities, either by providing strengthened IPR protection for such species, or through non-IPR-related measures such as public subsidies.
PLANT VARIETY PROTECTION AND THE INTERESTS OF POOR FARMERS The second issue is that in most developing countries, a large proportion of the population depends on agriculture for employment and income. Many of these farmers are small-holders for whom seed saving, across-the-fence exchange and replanting are common practices. This is especially true in countries where neither the public nor private sectors play a significant role in producing or distributing seed. Although the UPOV system allows on-farm replanting, its rules restrict farmers’ freedom to buy seed from sources other than the original breeders or their licensees. Seed companies argue in response that farmers do not have to purchase PVP-protected seed just because it is available. They point out that the farmers are free to continue cultivating non-plant variety protected seed, including traditional local varieties, if they so wish. Therefore their basic freedoms are unaffected by PVP. While this is likely to be true, folk varieties are often disparaged and may be excluded from the government-approved seed lists that are maintained in some countries. Moreover, in many developing countries, government support for farmers, including credit is sometimes conditional on the sowing of particular crops and types of seed, such as hybrids (Sperling, pers comm 1999). Also seed aid is often used by providers as a way to promote the use of particular crops and seeds. It should be noted here that seed saving is not always a cost-effective option for farmers. According to van Wijk (1996, p4), ‘the cost advantage of saving seed is eroded by the deterioration of saved seed, causing yield losses
68 Conflicts and Controversies over time. Deterioration is especially rapid with hybrids, but even here, the wide gap between new seed prices and the cost of seed-saving has encouraged some farmers in Latin America to save hybrid maize for a second generation’. It must be borne in mind, though, that the purchase of seed is one among several agricultural inputs that must be paid for, and even poor farmers may decide to pay a higher price for better quality seed if they expect a bigger harvest to result. Wherever the exact truth lies, the ‘sui generis’ clause in TRIPS does give governments a certain amount of freedom to tailor their PVP systems to address such concerns. Thus, while an increasing number of developing countries are joining UPOV, some countries are devising alternative PVP systems that aim in part to strengthen food security. They do this, for example, by allowing farmers to acquire protected seed from any source and/or requiring protected varieties to display qualities that are genuinely superior to existing varieties. The Indian parliament has passed legislation that would maintain farmers’ freedom to save, sell and exchange all produce of a protected variety (see Chapter 14), and the African Union (formerly the Organization of African Unity) has developed a model law for the consideration of member governments, known as the African Model Legislation for the Protection of the Rights of Local Communities, Farmers and Breeders, and for the Regulation of Access to Biological Resources (Chapter 13). In both cases, as much importance is attached to the interests of farmers as to those of breeders.
INTELLECTUAL PROPERTY RIGHTS AND THE AVAILABILITY OF GENETIC RESOURCES FOR BREEDING Plant breeders and other supporters of UPOV tend to stress the necessity of being able to freely access genetic material including that which is IPR protected. This is why the UPOV Convention contains such a broad breeders’ exemption. Patent law tends to have a much narrower research exemption which is often limited to non-commercial scientific or experimental use. Moreover, while a protected plant variety is covered by a single title, plantrelated biotechnological inventions are likely to be protected by a patent and in some cases several patents. The patents may cover not just plants, but also seeds, genes and DNA sequences. The effect of patents is to restrict access to the patented ‘products’. It has been argued that ‘locking up’ genetic resources with patents is a bad thing because innovation in plant breeding is cumulative and depends on being able to use as wide a stock of material as possible, including material owned by others. It was to deal with this concern that the FAO International Treaty introduced a number of provisions, as were laid out in Chapter 3. However, apart from patents, the restrictions on access to breeding material may have causes other than IPRs. For one thing, some countries have chosen to except certain categories of plant genetic resources, which they consider to
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be strategically important, from the multilateral system to be set up under the International Treaty. Also, some developing countries have been exercising their rights under the CBD to regulate access to their genetic resources and in doing so have restricted their free flow. This may well be detrimental to long-term food security even in their own countries (Fowler, 2002). But beyond these issues about how specific IPRs privatize the genetic material needed for breeding is the association of IPRs with the privatization of agricultural research, the shrinkage of non-proprietarian public sector research, and the increased concentration of ownership of breeding material, research tools and technologies in the hands of a small number of giant corporations (see Herdt, 1999). Not only does this trend reduce the free circulation of breeding material, but it can also make public policy-making aimed at enhancing food security harder to put into practice. This is because it is much more difficult for governments to influence companies than the public institutions they partly or wholly fund.2
EMPIRICAL EVIDENCE This discussion on how PVP affects food security and nutrition in developing countries leads one to consider in more general terms the applicability of such an IPR to these countries. Unfortunately, we have very few empirical studies on this issue. However, one relevant study was a joint project of the InterAmerican Institute for Cooperation in Agriculture and the University of Amsterdam, carried out in 1994, which examined ‘the (expected) impact of plant breeders’ rights (PBR) on developing countries with respect to: private investment in plant breeding; the breeding policies of public institutes; the transfer of foreign germplasm; and diffusion of seed among farmers’ (Jaffé and van Wijk, 1995, p7). Five countries were used as case studies, of which three (Argentina, Chile and Uruguay) had PVP systems already in place and two (Colombia and Mexico) were about to introduce them. These countries are similar in the sense that there are basically two seed markets. The hybrid seed market is controlled by transnational corporations, whereas the seed market for self-pollinating varieties is dominated by domestic firms. However, Argentina differs from the others in that it is the only country in which PVP-right owners have successfully enforced their rights to the extent that their control over seed supply for wheat and soya is comparable to that of their counterparts in the US. This leads the authors of the study’s report to conclude that, in all probability, PVP in that country has ‘prevented the local wheat companies from reducing or even terminating their breeding activities and triggered the reactivation of some soya bean breeding programmes’ (Jaffé and van Wijk, 1995, p8). With respect to exotic germplasm, there is little evidence to show that PVP has led to any significantly improved access for domestic seed companies to modern cultivars, special genetic stocks and genomic material from abroad
70 Conflicts and Controversies (Jaffé and van Wijk, 1995, pp61–68). Moreover, companies with licences from overseas breeders to use proprietary varieties may sometimes have to contend with restrictions on where they can export to. For example, in 1994, Argentinian strawberry plant growers were prevented from exporting their plantlets to Europe because the US breeder and the European licensees did not want these plantlets to compete with those that were already produced in Europe. In Argentina and Chile, public agricultural research centres are using PVP to secure income and collaborate with companies. According to the report, this is shifting the orientation of public research away from the needs of poorer farmers and reduces the public availability of their germplasm. How are farmers affected? First, Argentinian seed dealers must now pay royalties and taxes on the seed they trade. So far these costs have not been passed on to the farmers. Second, PVP legislation in the three countries where it is well established has not prevented the replanting of farm-saved seed. Third, as the report indicates, ‘since many modern plant varieties are not appropriate for resource-poor farmers, PBR predominantly favour plant breeding for those farmers who operate under relatively prosperous conditions’ (Jaffé and van Wijk, 1995, p9).
ALTERNATIVES TO UPOV TRIPS allows World Trade Organization (WTO) members to provide a sui generis alternative to patents for the protection of plant varieties. Frequently such an alternative (to patents) is assumed to be a system based upon the UPOV Convention, either in its 1978 version or the 1991 revision. But Article 27.3 (b) makes no mention of UPOV and permits countries to design their own PVP system as long as it is considered to be effective. The sui generis system may be defined and provided in various legal forms. For example, the system could be a standalone plant variety law, or it could be provided by, say, a modified patent law, as is, for example, by the US Plant Patent Act, which protects asexually reproduced plants through a modified patent system. Alternatively, the sui generis system could be embedded within nonIPR legislation, such as a biodiversity conservation or access and benefit sharing law (see Chapter 13). Realistic proposals for non-UPOV PVP systems have been few and far between. This is probably one of the reasons why more developing countries are joining UPOV. Nonetheless, it is important to consider alternatives to UPOV so that informed decisions can be made. In order to help countries devise an appropriate sui generis system, the International Plant Genetic Resources Institute (IPGRI) (1999) drew up the following list of key questions that decision makers should take into account: • • • •
What kind of domestic seed industry exists? What kind of public breeding sector exists? What kind of seed supply system is in place? To what extent is farm-saved seed used in the country?
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• • • • • • •
What is the current capacity of breeders? What do local breeders want to do in the next 5–10 years? Are external inputs to agriculture low or high? What are the country’s production needs and objectives? What is the country’s biotechnology capacity? What are the goals and realistic expectations of the biotechnology sector? What kinds of strategic alliances will the country want to enter into in the next 5–10 years and how involved will other countries be?
The fact that the answers to these questions will vary widely from one country to another suggests that, as with patents, one size is unlikely to fit all. A detailed discussion of all the issues involved falls outside the scope of this book, but it is important at least to discuss the matter of what the requirements for protection should be and the scope of an alternative system.
Requirements for protection How could a sui generis system be devised to resolve the alleged difficulties concerning UPOV’s protection requirements? Leskien and Flitner (1997), in their report for IPGRI on options for a sui generis system, suggest a number of alternative requirements. The first is to apply a less strict interpretation of ‘uniformity’ and ‘stability’ requirements. In theory this might provide an incentive for breeders to reduce their reliance on elite germplasm and to seek out less researched and more genetically diverse resources. This could result in more seed varieties appearing on the market and those available differing more widely from the others. More choice for farmers is likely to enhance the viability of agricultural systems everywhere. The second is to differentiate between homogeneous/uniform varieties and heterogeneous and traditional varieties in extent of rights available. The latter varietal types could still be protectable if they are clearly identifiable, but since broader claims would result, the rights should be weaker. However, one possible danger of allowing broader claims in this way is that corporate bioprospectors rather than local communities would take advantage of this and ‘jump the queue’ by promptly submitting applications for discovered landraces (or those they already hold in their collections).
Scope of the protection The scope of the protection offered by UPOV 1978 is somewhat weaker than that of UPOV 1991 and might be preferable for developing and least developed countries that have no experience of administering a plant variety right system and find it difficult to identify possible domestic users of an IPR system for plant varieties. Upholding the farmers’ privilege would lessen possible intrusion on the customary practices of local communities. Therefore, a sui generis system using UPOV 1978 as its model in terms of scope of protection but with different protection requirements as described above might be more
72 Conflicts and Controversies appropriate than a patent or UPOV 1991-type system for some countries. However, countries that wish to join UPOV are now required to accept the 1991 version.
Additional provisions Leskien and Flitner (1997) refer to various additional components to balance the IPRs granted to plant breeders with the interests of society as a whole and/or to local communities. One is an additional requirement for protection, based on early German PVP law, of ‘value for cultivation and use’ (VCU). Defining the VCU requirement would be left to national governments and could be adopted to ensure that breeders contribute to certain national priorities. For example, for a new variety to acquire protection, VCU might require applicants to demonstrate the socio-economic welfare or environmental benefits of the new variety, such as how it might benefit small farmers in terms of, say, enhancing productivity or requiring fewer inputs. Another is to introduce a community gene fund. Such a fund might be financed through a levy on the gross value of seeds sold. If the genetic material in these seeds can be traced to a locality, the communities could be rewarded for their efforts in conserving the genetic material in question. In cases where provenance cannot be established, Leskien and Flitner (1997) suggest that funds could then be used to support in situ conservation in priority regions where biodiversity is particularly threatened. However, for the reasons given in Chapter 1 when discussing the apportioning of benefits, it may be unrealistic to suppose that such a fund would be very large or could benefit single communities to any significant extent. Moreover, the transaction costs incurred in the tracing of beneficiaries and distributing of benefits would probably be too high for community gene funds to serve as an effective benefit sharing mechanism. Some interesting sui generis systems have been proposed with Article 27.3 (b) in mind, notably Leskien and Flitner’s (1997) PVP seal model, as described in the above report, and Butler and Pistorius’ (1996) remuneration system. These are briefly presented and analysed below. 1 The plant variety protection seal model 3 would grant the right holder an exclusive right to a seal or certificate for a variety that has fulfilled the requirements laid down in the sui generis system, one of which they suggest could be identifiability. The difference between such a seal and a trade mark is that the seal would not only constitute the variety’s denomination but would also certify full compliance of the variety with the protection requirements. Only the use of the seal in combination with the registered denomination and the material of the variety would be the exclusive right of the holder and those having the holder’s authorization. Once seed has been sold by the seal owner or others authorized by the owner, there will be no further restrictions on the use and sale of the variety. Thus farmers would be allowed to save and sell seed. Leskien and Flitner argue that in spite of this, the seal holders could still enjoy a competitive advantage,
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especially if the protection requirements of the sui generis system were adapted to the needs of farmers. Given that the rights are not as strong as those provided by the UPOV Convention or patents, Leskien and Flitner suggest that the duration of the right could be made longer than the minimum protection terms required by UPOV or the TRIPS patent provisions. However, it seems very doubtful that seal holders really could sustain a comparative advantage for any length of time when other breeders (or farmers) can so easily produce and sell the same variety. Therefore, the system would almost certainly be highly unpopular with plant breeders, who, if the system came into existence, would very likely respond by focusing more of their research on crops that lend themselves to hybridization. 2 The ‘remuneration without ownership/property right’ model (Butler and Pistorius, 1996) is designed with the following three objectives: to remunerate innovative plant breeding and provide incentives to encourage the development of novel plant varieties; to allow farmers access to varieties available on the commercial market and to save, sell, exchange, and use these varieties for breeding purposes, without violating private property rights; and to provide incentives to preserve, create and enhance biodiversity. Butler and Pistorius propose that the system should follow the example of a Dutch law in force between 1941 and 1966 by eliminating the concepts of ‘ownership’ and ‘property rights’ in plant genetic resources and relaxing the conditions for the registration of new varieties. The model would require all farmers to pay a tax on each crop based on the number of hectares they planted of each crop variety. The funds collected would be used to pay plant breeders a remuneration for breeding new varieties, with payment based on the proportion of total hectares planted each year for 25 years. The right of farmers to save, sell and use seed for breeding purposes would not be restricted. According to Butler and Pistorius (1996), although breeders are likely to be concerned about these freedoms, in developing countries they may have little to lose from not being able to enforce exclusive rights to their varieties. This is because most of the seed trade in developing countries is in the informal sector, and farmers often cannot afford new commercial varieties. Butler and Pistorius also acknowledge that estimating the areas of cropland planted in a particular variety could be difficult. One might go further and suggest that the costs of monitoring and enforcement could be so huge as to make the system unworkable, especially in large countries and those in which most farms are small-holdings. Besides, TRIPS states that IPRs are private rights, yet this system does not allow the breeders even to control the level of remuneration due to them. Therefore, it may well be considered unacceptable by the TRIPS Council.
Chapter 8 BEYOND INTELLECTUAL PROPERTY: TECHNOLOGY PROTECTION SYSTEMS
Terminator technology, as its name suggests, was coined not by proponents but by an activist, Pat Mooney, a Canadian, who was seeking to direct negative publicity towards it. In this he was highly successful. Terminator first came to Mooney’s attention in 1998 when he saw an announcement that a patent had been granted jointly to the US Department of Agriculture and Delta and Pine Land, a major American cotton seed company, describing molecular biological techniques for controlling gene expression in plants, plant parts or seeds so that traits can be switched on and off between generations (Charles, 2001, pp218–221).1 Conceivably, farmers could benefit from these techniques, depending upon the traits in question whose expression or non-expression may help to determine the success of the harvest. But among the claims is a method for producing seed that is incapable of germination, or to be more specific, a technology that would render harvested seed sterile. On the face of it, it seems extraordinary to invest so much effort and expense in developing a means to produce sterile seed. But despite the involvement of a public sector institution, this is strictly business. The purpose is to prevent farmers from replanting saved seed and thereby to undercut seed company monopolies. In doing so, it provides a means not only of preventing the infringement of intellectual property protection, but of ensuring the continuation of the monopoly beyond the life of any patent or plant variety certificate, assuming such activities require the authorization of the right-holder in question. Not only this, but terminator technology has grave implications for the activity of breeding, which requires unrestricted access to plant varieties to be used as sources of initial variation. The development of this technology seems to reflect the increased determination of the private sector (in this case, and in common with hybrids as we will see below, with the assistance of a public agency) to eliminate the replanting of proprietary seeds, which is also reflected in the increasing use of licensing agreements stipulating that customer-farmers must not replant their patent-protected seeds. Such agreements would of course become unnecessary if this technology became widely used.
Beyond Intellectual Property: Technology Protection Systems 75
Genetic use restriction technologies (GURTs), of which terminator is just one, are not new. In the early 20th century, a US public sector plant scientist called George Shull discovered the phenomenon of (what he called) ‘heterosis’ in the corn plants resulting from his cross-breeding of inbred pure lines. This phenomenon, commonly referred to as ‘hybrid vigour’, is manifested in heightened yields. But because they are hybrids, the offspring cannot breed true and the yield enhancements thus last for only a single generation. So while farmers stand to benefit from seeds providing this hybrid vigour, they need to buy seeds at the beginning of every planting season to enjoy equally productive future harvests. This necessity was and continues to be a boon for the seed companies. Indeed, ‘of the US$15 billion market in commercial seed at present, hybrids account for approximately 40% of sales, and most of the profit’ (Sehgal, 1996, p18). But as long as the cost of seed purchases is exceeded by additional revenues obtained through the hybrid vigour, farmers will continue to use hybrids in place of their open pollinating counterparts.2 The hybrid route to the breeding of better seeds is generally assumed to be a very good thing for the development of the seed industry, and some believe, also for farmers. In fact, several of the world’s major 20th-century seed companies first came to prominence through their successful breeding of hybrid corn varieties. These include Pioneer Hi-Bred, DeKalb, Pfister and Funk. But sceptics argue that the massive investments in the development of hybrid varieties that were made in the 1920s and 1930s could have been allocated to breeding based on more conventional techniques that would have achieved similar yield increases but without preventing farmers from being able to replant their harvested seeds. Berlan and Lewontin (1998) are particularly negative (as they are about terminator), arguing that hybridization is a kind of ‘deterioration technique’ that not only enables seed companies to eradicate onfarm saving and exchange but actually eliminates all opportunities to improve crops through selective breeding. Farmers may gain in the short term, but widespread adoption of hybrid varieties may not necessarily be in their longterm interests. At the beginning of the 20th century, hybrid productivity was not much greater than their conventionally bred counterparts (Bugos and Kevles, 1992). However, from the middle of the century, increased private investment was considerably improving the yields of hybrid corn. Unfortunately for breeders, hybridization does not work so easily for some of the most widely cultivated crops like wheat and rice, and is consequently less commercially viable. This, of course, presents problems for breeders. Plants are self-reproducing. With no law to prevent it, there is nothing to stop farmers from replanting harvested grain as seed, or even multiplying seed for the purpose of selling it in competition with the breeder (assuming this would be more profitable for them than selling harvested produce).3 Terminator technology appears to provide the solution to the problem. But unlike the earlier biotechnology protection system and other GURTs still under development that seek merely to control the expression of specific traits, terminator, which uses seed sterility as the basis of its use restriction, provides
76 Conflicts and Controversies no productivity or agronomic benefits to the farmer who buys the seed. Worse still, there is actually a net loss, since freedom is removed but there is no compensating gain offered as there was with hybrid corn and as the so-called trait-specific GURTs promise to provide. This point gives rise to some important questions. The most basic one is whether the terminator controversy affects the future of agriculture or not. Second, if patenting is about promoting inventive activity for the benefit of the public, is terminator the kind of invention that should be encouraged? Third, if not, are there sufficient legal grounds for preventing its legal protection through the patent system? Finally, if these grounds are lacking, ought countries expand the applicability of the ordre public and morality exclusions available to World Trade Organization (WTO) member states by virtue of Article 27.2 of TRIPS (which is construed rather narrowly in Europe), so that such technologies can no longer be protected? This chapter seeks answers to these questions, while also putting forward three arguments. First, countries have the sovereign right to determine whether or not it is appropriate to extend a patent monopoly to inventions it deems morally objectionable or contrary to the public interest, but, nonetheless, it must be kept in mind that the commercialization of the technology in question is a matter for national regulatory and competition authorities to decide upon and not the patent granting office. Second, countries need to adopt rational and wellconceived competition policies to ensure that GURTs do not lead to anticompetitive corporate concentration in the seed production and distribution markets. Finally, but perhaps most importantly, as businesses become better able to maximize returns from their agro-biotechnological research outputs through legal and technological means, it becomes ever more vital to support public sector research targeted not just at commercial agriculture but also at poor subsistence farmers in the developing world.
HIGH STAKES When even mild criticism of the technology irritates the US government enough for it to become heavy-handed with intergovernmental organizations, it becomes clear that the stakes are high. Terminator does matter, although it is difficult to be certain about its long-term impacts. The Conference of the Parties to the Convention on Biological Diversity (CBD) has for several years been concerned about GURTs and, at its sixth meeting in 2002, adopted a decision which invited UPOV to examine ‘the specific intellectual property implications of genetic use restriction technologies, particularly in respect of indigenous and local communities’. The UPOV Office’s memorandum, submitted to the CBD secretariat in January 2003, was a fairly tame document that expressed some mild scepticism of the benefits of GURTs but did not condemn them outright, and was mostly concerned to uphold the integrity of the UPOV system of plant variety protection (PVP) (UPOV, 2003a). The US Patent and Trademark Office was sufficiently alarmed about this to write to UPOV Vice Secretary-General Rolf Jördens expressing its objection to the
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submission of the document and its disagreement with the document’s views concerning GURTs, and requesting that it be withdrawn.4 UPOV complied and in April this year sent the CBD secretariat a rather bland position paper, which curiously barely mentioned GURTs (see UPOV, 2003b). Perhaps the main indicator of terminator’s importance, though, lies in the fact that the US Department of Agriculture (USDA) has been developing GURTs with the private sector as part of the US government’s wider and longterm effort to protect the intellectual property of its businesses in overseas markets, including developing countries. Indeed, according to a spokesman from the USDA, the aim is for the technology to be ‘widely licensed and made expeditiously available to many seed companies’ in order ‘to increase the value of proprietary seed owned by US seed companies and to open up markets in Second and Third World countries’ (quoted in RAFI, 1998c). Dr Harry Collins of Delta and Pine Land, co-owner of the patent with the USDA, claimed that the patent ‘has the prospect of opening significant worldwide seed markets to the sale of transgenic technology for crops in which seed currently is saved and used in subsequent plantings.’5
PROS AND CONS Terminator has some potential benefits. For one thing, it could allay one of the concerns of opponents of genetically modified (GM) crops, which is the risk that genes from these plants may cross over to other species, a phenomenon called horizontal gene transfer that, ironically, many advocates of GM agriculture dismiss as being nothing to worry about anyway. In addition, secure protection might encourage further investment in agricultural biotechnology and plant breeding including in directions that benefit small farmers. The former is plausible, while the latter is completely speculative. There is some anecdotal evidence that weak PVP in the US, which until the mid-1990s allowed ‘brown-bagging’ (the sale of harvested seed by farmers), led to the closing down of at least one commercial seed production programme (Srinivasan and Thirtle, 2002, p157). But this was before the law was tightened up through an amendment to the Plant Variety Protection Act and a Supreme Court decision, and when the patenting of plants was less common than it is today. Besides, if their public justifications are an indication, the USDA and Delta and Pine Land are more interested in applying terminator in foreign markets than their domestic one. Perhaps the main problem with terminator, if we suppose for a moment that the technology will encourage small farmer-oriented research, is its restriction on seed replanting, exchange, diffusion and on-farm breeding activities. To explain why, it is important to understand that developing country subsistence farmers generally acquire their seeds from their own farms or those of neighbours. Maintaining the freedom to do this is very important for two reasons. First, subsistence farmers often lack funds or credit to buy seed at the start of each planting season. For them, buying seed is a considerable
78 Conflicts and Controversies investment. If it turns out that the benefits of terminator-protected seed are insufficient to compensate for its higher price, farming may become even more risky for the poor. Admittedly, farmers can presumably return to their traditional varieties, but one poor harvest accompanied by increased debt may be enough to cause destitution. Second, many developing country small-scale farmers do much more than simply grow seed produced elsewhere. Indeed, local varieties are themselves the result of generations of improvement through on-farm selection and experimentation, and nowadays such practices can involve modern varieties which may need to be adapted to suit local conditions. Turning such farmers into mere customers of companies selling terminator-protected seed will halt these practices. This may not only be detrimental to local food security but, if it became a global phenomenon, could weaken plant breeding efforts worldwide by reducing the variety of germplasm available. For these reasons, subsistence farmers are unlikely to be sympathetic to, or gain much comfort from, Collins’ assertion that ‘the centuries-old practice of farmer saved seed is really a gross disadvantage to Third World farmers who inadvertently become locked into obsolete varieties because of their taking the “easy road” and not planting newer, more productive varieties’. If yields from GURT-protected seed prove to be disappointing, and if such seed is more dependent on inputs like agrochemicals than traditional varieties (which is often the case with modern varieties), then farming communities could suffer destitution. Defenders will no doubt argue that farmers still have a choice. But in reality they may not, for the reasons given in Chapter 7.
TERMINATOR AND THE PATENT SYSTEM For many critics, being able to patent such a technology is an indictment of the patent system. It may be reasonable to question whether or not society should be encouraging such research through the promise of a patent monopoly. Moreover, it is legitimate to be concerned that protecting seeds through both patents and GURTs is overprotective in a similar way that support for encryption through copyright law in the form of banning circumvention devices is overly generous to owners.6 In addition, countries might consider such inventions to be immoral or contrary to ordre public, and this is a decision that deserves to be respected. Legally, they have the right to determine their own criteria for what is immoral or contrary to ordre public. India has already banned terminator and one can easily envisage other developing countries following suit. For such countries, terminator is clearly not the sort of technology they want their patent systems to encourage. However, one can argue that there is no particular need to respond to terminator-type patents by broadening the application of these exceptions.7 In fact, if terminator could not be patented on these or other grounds, this might further encourage research in this area. GURTs would appear to be especially useful in jurisdictions where IPR protection is weak. Besides, the patent itself is
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not a right to commercially exploit. The freedom to use such technologies should not be automatic but subjected to an approval process founded on sound science, socio-economic and environmental assessments of its impacts and, arguably, the precautionary principle. Patent-granting authorities are not qualified to do any of this. There are two main issues highlighted by the terminator patent, even though these have often been ignored in the controversy. First, terminator technology exemplifies the way agricultural research is more and more expensive, commercially oriented and technologically advanced. Consequently, the sector is becoming one which an ever smaller number of companies is able to enter, while those that are already in and can compete come to dominate. In fact, terminator may accelerate this visible process of corporate concentration8 while further undermining public sector research. It may do this by tightening the locks on plant genetic resources so others must either do without them or pay too financially burdensome licence fees (Swanson and Goeschl, 2002, pp60–61). If so, countries need to adopt competition and seed regulations that ensure that farmers and consumers continue to have a choice and which maintain the public sector’s freedom to operate in agricultural research. One measure they might consider is compulsory licensing. However, one should bear in mind that if companies cannot easily capture the benefits from technological innovation through the patent system, this may make them even more determined to control markets through other means, such as by taking over supply networks and by integrating horizontally so they can market ‘packages’ of products that need to be used together (Rangnekar, 2002b, p1016).9 This issue is difficult to resolve but at least forces us to reflect upon what should be considered an appropriate rate of return on private investments. Second, we allow the private sector to monopolize agricultural research at our peril, and the peril especially of developing country farmers, who are bound to be ignored in the same way that drug companies ignore the diseases of the poor for sound economic reasons. Terminator could make the situation worse for the poor because, even if GURT-protected seeds are developed for the use of poor farmers, this may have a detrimental effect, as the scope for on-farm breeder experimentation – often necessary to adapt varieties so they better meet the specific needs of farmers – will be reduced. It could also be disadvantageous if public sector researchers in other countries have the same motivations as the USDA in supporting terminator. Public sector agricultural research is declining worldwide (Knight, 2003). Yet research targeted at poor farmers is as necessary as it has ever been. Not all public sector research does this, as the terminator research amply demonstrates, but we can be sure that even less will be done if business is left to conduct all the research. Indeed, the termination of public sector research may be a bigger problem for poor farmers than terminator technology.
Chapter 9 LIFE SCIENCE INNOVATION, BIOTECHNOLOGY TRANSFER AND DEVELOPING COUNTRIES
THE IMPORTANCE OF LIFE SCIENCE INNOVATION IN TRADE AND DEVELOPMENT The case was made in Chapter 1 that biodiversity-rich developing countries probably have little to gain from simply exporting biological samples and extracts. They may benefit more by considering two other approaches, either as alternatives to, or in combination with, the export of samples and extracts. The first of these is the improvement and integration of advanced life science research and development (R&D) and production capacities. The second is the identification, development and marketing of high-value primary and semiprocessed products. A static understanding of the principle of comparative advantage might lead us to suppose that while option 2 is feasible, biodiversity-rich developing countries need not consider attempting option 1, and should stick to exporting raw biological material. This generalization is quite sweeping, and is unlikely to be true for those developing countries that are relatively advanced in science, technology and industrial development. Nonetheless, one must be cognizant of the very real obstacles to following option 1, especially the huge investments in training, education and advanced R&D facilities that would be required. Enhancing the scientific and technological bases of developing countries requires appropriate regulatory and legal frameworks providing rewards and incentives for innovation and investment. The task for developing countries is, one can argue, to follow successful former developing countries like Japan and South Korea by transforming their comparative advantage from producing lowvalue commodities to high-value goods and services while increasing employment possibilities for the poor and not just for the well educated. So in the present context, the challenge for today’s developing countries is to exploit their de jure control of biogenetic resources by: identifying technological fields or industrial or market sectors where they may be able to compete internationally; acquiring and/or channelling the necessary investments to
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develop and market high value products; and putting in place the institutional reforms needed to ensure that efforts to conserve biodiversity and utilize biological resources do not conflict but are mutually supportive. While science-based research-intensive industries and technologies like pharmaceuticals and the new biotechnologies are extremely important for adding value to countries’ biogenetic resources, competitive high value-added products can be developed without cutting-edge scientific knowledge and equipment. High value products may succeed in the market based on knowledge acquired from sources such as traditional communities. Products derived from biogenetic resources will command high prices in international markets only if they are knowledge-intensive, but this does not by definition require them to be science-based, high tech, R&D intensive, or for that matter based on traditional knowledge. In fact, various kinds of knowledge must be acquired and used for any product to succeed in the increasingly competitive global economy. According to Mytelka and Tesfachew (1998, p2), these kinds of knowledge include: product design; process engineering; quality control; management and maintenance routines; knowledge about markets and investment opportunities; and the skills and capabilities needed to undertake changes in products and processes, create networks, and sustain partnering activity. This much broader conception of ‘knowledge’ comes close to Schumpeter’s definition of ‘innovation’ (ie ‘carrying out new combinations’), which comprises: 1 2 3 4 5
The introduction of a new good …. The introduction of a new method of production … which need by no means be founded upon a discovery scientifically new…. The opening of a new market …. The conquest of a new source of supply of raw materials …. The carrying out of the new organization of any industry … . (Schumpeter, 1983, p66, emphasis added)
Innovation as understood in this broad sense is essential for countries seeking to produce high value-added manufactured goods and commodities rather than low-value raw materials. Innovation connotes newness, but it is possible to argue that an innovation for one company or national economy may not necessarily be innovative to another. Ernst et al (1998, in Mytelka and Tesfachew 1998, pp1–2) make this point when they define ‘innovation’ as ‘the process by which firms master and implement the design and production of goods and services that are new to them, irrespective of whether or not they are new to their competitors – domestic or foreign.’ Although this definition has the weakness of blurring the distinction between innovation and imitation, it does at least make clear that promoting innovation in developing countries also means facilitating the acquisition, dissemination, and (where necessary) adaptation of knowledge and technologies from elsewhere.
82 Conflicts and Controversies While it is the private sector that will be most involved in commercialization and external trade, governments have a vital role to play in capacity building and in creating a conducive institutional-regulatory environment to promote innovation from basic research to commercialization. According to the United Nations Conference on Trade and Development (UNCTAD) (1997, p5): ‘today more than ever before, it is recognized that the production and distribution of generic knowledge, be it in the form of basic science or basic general training, is a responsibility of governments. The incentives for the private sector are not strong enough to guarantee an adequate level of investments in these’.
TECHNOLOGY TRANSFER Although innovation takes place in all parts of the world, developing countries tend to be net importers of modern technologies. Consequently, for several decades, international technology transfer has been a major priority for these countries. In any informed discussion on technology transfer, it is important to be clear what ‘technologies’ are and to be aware of the mechanisms by which they are normally transferred. Crespi and Straus (1996, p12) see technologies as ‘industrial and agricultural processes and products, and the relevant enabling technology for practical realization’. According to Brenner (1997), technology has tangible and intangible elements, including products, machines and technical knowledge: In its original sense, technology implies a knowledge both theoretical and empirical of given techniques. Products and machines constitute its visible and tangible aspects, but technology also has an intangible component that is present in the minds and memories of the individuals, in the organization structures and in the behaviour (Brenner, 1997). Industrial technologies are conventionally transferred through such formalized means as foreign direct investment (FDI), joint ventures and licensing, of which FDI is the main channel (Radosevic, 1999, p28). According to Roffe (1999), formal private-sector1 technology transfer: is a commercial operation that takes place through firm-to-firm arrangements and involves flows of knowledge, be they embodied in goods (as in the sale of machinery and equipment) or in the form of ideas, technical information and skills (through licensing, franchising or distribution agreements). Technology transfer can take place at arm’s length, as in the case of the export of capital equipment or of licensing agreements between unaffiliated firms, or it can be internalized through the transfer of new production techniques within a transnational corporation, between affiliate firms (Roffe, 1999, p151).
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In fact, a great deal of formal international ‘technology transfer’ takes place within the same companies. Given that these companies continue to control access to the technologies, it seems reasonable to question whether such transactions are genuine technology transfers of the kind that would result in widespread adoption in developing countries. It is also worth noting that some companies are alleged to adopt fraudulent accounting practices when declaring the cost of such transactions for tax evasion purposes. Informal technology transfers can also take place on a large scale and in those countries in the early stages of industrialization these may be far greater in number than formal ones (Kim, 2002). It is noteworthy in this context that Article 18 of the CBD acknowledges the existence of ‘indigenous and traditional technologies’, which rarely flow though formal transactions. By definition, informal transfers are not based on any monetary transactions or legal agreements. If intellectual property rights (IPRs) exist to create markets for knowledge, such transfers presumably do not depend at all on the existence of intellectual property protection. Consequently, this chapter focuses on formal technology transfer. The relationship between levels of IPR protection and the volume and direction of inward technology flows is highly complex. According to Maskus (2000, p123), in countries with strong IPR protection and enforcement, transnational corporations are likely to favour technology licensing agreements and joint ventures. In countries with weak IPRs, FDI would be the favoured business strategy in overseas markets.2 But technology flows are nonetheless likely to involve a great many factors whose relative importance will vary widely from one country to another. Theoretically, it seems logical to assume that IPR availability would be a prerequisite for the international transfer of new technologies, at least those that can easily be copied. One would expect companies to be reluctant to lose control over technologies that may have cost them millions of dollars to develop in countries where domestic firms can adopt the technologies and produce goods that will compete with those of the technology owners. Accordingly, the only way that companies would feel encouraged to transfer proprietary technologies is where IPR protection is sufficiently strong for them to charge high enough licence fees to reflect the costs of innovation, or alternatively by means of FDI or joint ventures where they maintain more control over the technologies.3 However, a counter-argument can be made that the overall effect of IPRs will inhibit technology transfers. The views of the critics who argue that IPRs inhibit technology transfer and reinforce North–South inequalities can be summarized as follows: As an intervention in the free market, patents restrict the number of people who could otherwise freely make, use, sell or import the protected products and processes. This enables owners to maintain high prices, avoiding a situation where the price of their products or processes is driven down towards the marginal cost of reproduction. Foreign patent owners can use their legal rights, either to block access to their technologies or to charge licence fees that are too
84 Conflicts and Controversies high for domestic firms. If so, one might argue that the best ways for developing country governments to help domestic firms and public institutions to acquire technologies might be to weaken patent rights, for example by allowing compulsory licensing on licensee-friendly terms. According to Reichman and Hasenzahl (2002, p8) ‘about one hundred countries recognized some form of non-voluntary licensing in their patent laws by the early 1990s’. This may not be the case, however. It is important to understand that reading a patent specification is unlikely to be sufficient to gain access to a technology. There are three reasons for this. First, patents do not necessarily disclose the invention to the extent that a person skilled in the art could manufacture it. Undisclosed tacit knowledge is often essential for reproducing an invention. Also, ‘in the public domain’ is not synonymous with ‘freely available’. According to Macdonald (1998, p74): Legal fiction maintains that all the information needed to re-create the invention is contained in the patent specification. The fact is that the specification is forced to refer again and again to other information, information that is in the public domain, which means that it is available somewhere but must be acquired from these sources before the information in the specification can be used. Much of this information will be tacit and uncodified information. Macdonald adds that ‘the information contained in patent specifications is available only to those who consult them directly, or who pay others more adept at arcane classifications and the language of lawyers to do so.’4,5 Second, the potential to take commercial advantage of information disclosed in expired patents may be precluded by multiple overlapping IPR portfolios. For example, companies sometimes apply for further patents or use trade marks or copyright protection as a means to extend the life of a monopoly beyond the expiry date of the original patent. Third, many developing countries lack the institutional capacity to adopt and adapt new technologies. As for the geography of patent ownership, this is heavily skewed in favour of the North. Despite the recent increased developing-country membership of international IPR agreements such as TRIPS, the Paris Convention and the Patent Cooperation Treaty, the vast majority of patents continue to be filed by companies based in North America, Western Europe and East Asia. Since such companies are the main users of the patent system, in the short term at least, they will be the major beneficiaries of new patent laws in developing countries. And, given the economic power of these companies, it may be more difficult than ever for developing countries to negotiate favourable terms for technology. Drahos (1997) suggests a worst-case scenario: ‘if it turns out that the global market in scientific and technological information becomes concentrated in terms of the ownership of that information it might also be true that the developmental paths of individual states become more and more dependent upon the permission of those intellectual property owners who together own most of the important scientific and technological knowledge’ (p56).
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What is the empirical evidence concerning the links between stronger IPRs, investment flows, R&D and technology transfers? In fact, the data produced so far are hardly conclusive and suggest that FDI decisions may depend on a host of factors including the general investment climate. A study by Maskus (1998) claimed some evidence of a positive correlation, while conceding that IPRs are one of several factors that may facilitate technology transfers, and also that strengthening IPRs will involve unavoidable costs (in terms of legislation, administration and enforcement) as well as benefits for developing countries (UNCTAD, 1996; Finger and Schuler, 1999). A World Bank study was even more cautious and recommended further research before firm conclusions could be made (Primo Braga and Fink, 1999). Evidence from Turkey found that the banning of pharmaceutical patents appeared to have no significant effects on levels of FDI, technology transfers or domestic innovation (Kirim, 1985). Similarly, a study on Brazil, taking the manufacturing industry as a whole, found no evidence that FDI levels were greatly affected by patent protection (Kondo, 1995). On the other hand, Mansfield’s (1994) well-known study, based on interviews with intellectual property executives of US corporations in several industrial sectors, indicated that a large proportion of respondents from the chemical and pharmaceuticals industries claimed that their FDI decisions were affected by the levels of IPR protection available. Research by Kim (2000) on the experience of South Korea suggests that ‘strong IPR protection will hinder rather than facilitate technology transfer and indigenous learning activities in the early stage of industrialization when learning takes place through reverse engineering and duplicative imitation of mature foreign products’ (2002, p5). He also concludes that ‘only after countries have accumulated sufficient indigenous capabilities with extensive science and technology infrastructure to undertake creative imitation in the later stage will IPR protection become an important element in technology transfer and industrial activities’ (2002, p5). Similarly, Kumar (2002) found that in the East Asian countries he studied (Japan, South Korea and Taiwan), a combination of relatively weak IPR protection and the availability of second-tier patents (utility models) and designs, encouraged technological learning. The weak IPRs helped by allowing for local absorption of foreign innovations. The second-tier systems encouraged minor adaptations and inventions by local firms. Later on, the IPR systems became stronger, partly because local technological capacity was sufficiently advanced to generate a significant amount of innovation, and also as a result of international pressure. India’s experience is somewhat similar, except that no second-tier protection was provided. This did not hurt the chemical or pharmaceutical industries, but may have hindered the development of innovative engineering industries. In short, much uncertainty remains as to the effects of IPRs on technology transfers to developing countries. But there is empirical evidence to suggest that the effect of IPRs on technology transfer depends on the level of development of a country, the specific technological fields involved, and the behaviour and absorptive capacity of individual firms (Kim, 2002). Accordingly,
86 Conflicts and Controversies TRIPS is likely to benefit some countries, harm others, and make no difference elsewhere. But bearing in mind the highly concentrated market structures of some industries, it is possible that the bargaining power of all developing countries and their companies is likely to be weak and getting weaker still, especially in smaller countries that are unlikely to be an important market for the technology-owning firms. Yet the situation is not entirely bleak. There is some evidence from Africa to suggest a certain willingness of transnational corporations to share proprietary technologies on concessional terms (see Stokes, 1998). But often this is only for as long as domestic companies do not produce competing products for sale in that market or abroad.
Transfer of technologies relevant to conservation and sustainable use of biodiversity According to the CBD, access to and transfer of technology must be ‘provided and/or facilitated under fair and most favourable terms’ but: where subject to patents and other intellectual property rights, such access and transfer shall be provided on terms which recognize and are consistent with the adequate and effective protection of intellectual property rights (Article 16.2). The private sector plays a key role in technology transfer, yet it is governments that are required to implement the CBD. Therefore, while governments can act as facilitators6 by, for example, helping to provide financial incentives, funding and appropriate technical assistance, the providers of technologies will mostly be companies. Since few developed-country governments have been active in this regard, this provision of the CBD has been inadequately implemented. With respect to technologies relevant to the conservation and sustainable use of biological diversity, which make use of genetic resources, and/or do not cause significant damage to the environment, some authorities claim that many of them are in the public domain already (Juma, Mugabe and Ojwang, 1994; WTO-CTE, 1996a), either because the patents have expired or because they were never IPR-protected. The note by the Secretariat of the CBD to the second meeting of the Subsidiary Body on Scientific, Technical and Technological Advice (SBSTTA) refers to in situ and ex situ conservation technologies and sustainable use technologies (CBD Secretariat, 1996b). Often these are interlinked or even identical. In situ conservation and sustainable use technologies include aerial survey equipment, Geographic Information Systems, fencing equipment, and ‘technologies associated with low-external input agriculture, integrated pest management, re-vegetation and other on-farm management techniques’ (CBD Secretariat, 1996b). Soft technologies may take the form of ‘know-how, management routines, and behavioural patterns and attitudes’ (CBD Secretariat, 1996b). Ex situ conservation and sustainable use technologies include ‘tissue culture, field-based propagation, protoplast fusion, and cryopreservation’ (CBD Secretariat, 1996b). Common mechanisms for transferring such technologies
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include: ‘joint R&D, the training of nationals in foreign universities and other institutions, [and] technology partnerships undertaken under biodiversityprospecting arrangements’ (CBD Secretariat, 1996b). In addition, organizations exist that provide technology transfer brokerage services.7 We also have what the CBD refers to as indigenous and traditional technologies. These include: know-how concerning the preparation, processing, or storage of useful species; knowledge of formulations involving more than one ingredient; knowledge of individual species; knowledge of ecosystem conservation; and classification systems of knowledge, such as traditional plant taxonomies (Posey and Dutfield, 1996, p12). While acknowledging the abundance of public domain technologies and knowledge, the licensing of IPR-protected inventions (and plant varieties) is undeniably important as a means to facilitate transfers of technology to developing countries. In the case of IPR-protected plant varieties, licensing can enable developing country recipients to acquire valuable know-how and access to inbred lines, and enhance their technology-absorbing capacity by such means as training and the transfer of production techniques, although, as we saw in Chapter 7, empirical evidence about this is lacking.
Part 3
PROTECTING TRADITIONAL KNOWLEDGE
Chapter 10 TRADITIONAL KNOWLEDGE AND THE INTELLECTUAL PROPERTY SYSTEM
THE NATURE OF TRADITIONAL KNOWLEDGE To investigate how traditional knowledge (TK) can be legally protected, it is necessary first to explain what ‘traditional knowledge’ actually is. If one studies the literature on the subject, it becomes evident that the term is understood, misunderstood and applied in a confusing variety of ways. These assumptions relate to the following areas: 1 2 3 4 5 6
the identity and nature of TK holding societies; the relationship between TK and other forms of knowledge; the extent to which TK can (or cannot) be new and innovative; property rights in TK holding societies; authorship in traditional societies; folklore and TK and the public domain.
Traditional knowledge commonly refers to knowledge associated with the environment rather than knowledge related to, for example, artworks, handicrafts and other cultural works and expressions (which tend to be considered as elements of folklore). According to one expert, traditional knowledge (or what she calls ‘traditional environmental knowledge’) is: a body of knowledge built by a group of people through generations living in close contact with nature. It includes a system of classification, a set of empirical observations about the local environment, and a system of self-management that governs resource use (Johnson, 1992, pp3–4). Arguably, TK may be found in all societies no matter how modern they might appear to be and how untraditional much of the knowledge in circulation within them is. This is not to suggest that TK is easy to find in every society, but that the urbanization and westernization processes that have transformed
92 Protecting Traditional Knowledge many of the world’s societies are unlikely to have resulted in the complete eradication of TK even in those countries which have experienced these phenomena the most. However, many people tend to apply the term more narrowly to the knowledge held by tribal populations that are outside the cultural mainstream of the country in which these peoples live and whose material cultures are assumed to have changed relatively little over centuries or even millennia. Those who use the term this way consider TK as referring primarily to the knowledge of indigenous and tribal peoples as defined under the International Labour Organization Convention 169 Concerning Indigenous and Tribal Peoples in Independent Countries. According to the Convention ‘tribal peoples’ refers to those: whose social, cultural and economic conditions distinguish them from other sections of the national community, and whose status is regulated wholly or partially by their own customs or traditions or by special laws or regulations. ‘Indigenous peoples’ refers to those peoples: who are regarded as indigenous on account of their descent from the populations which inhabited the country, or a geographical region to which the country belongs, at the time of conquest or colonization or the establishment of present state boundaries and who, irrespective of their legal status, retain some or all of their own social, economic, cultural and political institutions. Because it is so common to characterize TK-holders as being members of such societies, the term ‘indigenous knowledge’ is sometimes used instead of, interchangeably with, or as a sub-set of, traditional knowledge. However, to make matters still more complicated, ‘indigenous knowledge’ is also used by others – often academics – in a slightly different way to express the localized nature of the knowledge they are referring to. Holders of indigenous knowledge, according to this view, may come from a diverse range of (indigenous and non-indigenous) populations and occupational groups, such as traditional farmers, pastoralists, fishers and nomads, whose knowledge is linked to a specific place and is likely to be based on a long period of occupancy spanning several generations. Often, this knowledge is differentiated with more generally held knowledge and with the knowledge of urbanized and western (or westernized) societies. Others would claim that such conceptual approaches are unnecessarily narrow in the sense that TK is not necessarily local and informal, and that to assume it is would exclude formalized traditional systems of knowledge that are well documented in ancient texts and are part of the cultural mainstream of some countries, such as the Ayurvedic, Siddha and Unani health systems of the South Asian countries. In some countries, these systems are formalized to the extent that they are studied at universities and have just as high a status as western biomedicine. In India, some commentators differentiate these
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knowledge systems from local folk knowledge, which still tends to be orally transmitted, even though they consider all these kinds of knowledge to be traditional. To this writer, in light of the above discussion, it seems reasonable that TKholding individuals, groups and communities may be members of culturally distinct tribal peoples as well as traditional rural communities that are not necessarily removed from the cultural mainstream of a country. These TKholding societies may inhabit areas of both the developing and the developed world, although they are more likely to be found in culturally (and biologically) diverse developing countries where indigenous groups continue – in the terminology of the Convention on Biological Diversity (CBD) – to embody traditional lifestyles. But while TK-holders tend to inhabit rural areas, including very remote ones, members of such peoples and communities may live in urban areas and still continue to hold TK. Traditional knowledge may also be held and used by individuals in urbanized and westernized societies that have no other connection with the societies from which the TK may have originated. Evidently, we should avoid a fixed and dogmatic idea of what TK-holders and their communities look like. But at the same time, it is important not to conflate the differing concerns and interests of the various types of TKholding society. For indigenous and tribal groups facing cultural extinction, preserving their knowledge may take on a special importance (even if respect for their land rights could be more crucial still). Because TK is difficult to define, some experts have tried to clarify its meaning, either by describing what it is not rather than what it is, or by identifying various features that make it completely opposite to scientific knowledge as the latter term is understood in urban, western, westernized or secular societies. Leaving aside the point made earlier that traditional knowledge also persists in the latter types of society, albeit to a limited extent, such a dichotomy seems at first to be quite plausible. Johnson identifies several ways that TK is generated, recorded and transmitted, which the relevant academic literature considers makes TK completely different to western scientific knowledge (Johnson, 1992, pp7–8). Thus, traditional knowledge: 1 2 3 4 5 6 7 8
is recorded and transmitted orally; is learned through observation and hands-on experience; is based on the understanding that the elements of matter have a life force; does not view human life as superior to other animate and inanimate elements but believes that all life-forms have kinship and are interdependent; is holistic rather than reductionist; is intuitive rather than analytical; is mainly qualitative rather than quantitative; is based on data generated by resource users themselves rather than specialized group of researchers; is based on diachronic rather than synchronic data;
94 Protecting Traditional Knowledge 9
is rooted in a social context that sees the world in terms of social and spiritual relations between all life-forms; and 10 derives its explanations of environmental phenomena from cumulative, collective and often spiritual experiences. Such explanations are checked, validated and revised daily and seasonally through the annual cycle of activities. Is this dichotomy simplistic or even false? It seems credible, based as it is on a thorough review of the literature. Yet it needs at least to be qualified. Few if any populations are completely isolated or have been for a long time. Crosscultural transfers of knowledge and consequent hybridization and cross-fertilization between different systems of knowledge are thus likely to be the norm rather than the exception. One should therefore be cautious in assuming that traditional knowledge systems are discrete, pristine and susceptible to generalizations of the kind made by Johnson. As another anthropologist has argued, the same may be said for scientific knowledge, which ‘is indisputably anchored culturally in western society, where it largely originated, although with the contemporary communications revolution and cultural globalization, hybridization is occurring and blurring distinctions between scientific and other knowledge on socio-cultural grounds’ (Sillitoe, 1998, p205). It is worth adding that even if these differentiations are completely reliable, one should not conclude that TK is inherently unscientific. Johnson’s findings confirm that a great deal of traditional environmental knowledge is empirical and systematic, and therefore scientific. Further support for the view that TK is scientific comes from anthropologists and other academics who use the ethnoscience approach to studying TK relating to nature, and treat this knowledge as being divisible into western scientific fields. Accordingly, we have ethnobiology, ethnozoology and ethnomedicine, for example. Of course, not all TK would fall into these categories – nowhere in the world is all knowledge associated with nature scientific. But it seems reasonable to claim that some TK is to some degree scientific, even if the form of expression may seem highly unscientific to most of us. For example, an indigenous person and a scientist may both know that quinine bark extract can cure malaria. But they are likely to describe what they know in very different ways, which may be mutually unintelligible (even when communicated in the same language).1 To some, traditional knowledge is by definition age-old knowledge, and creativity and innovation are generally lacking. Otherwise it would not be traditional. But recent empirical studies of traditional communities have discredited this view. As Barsh explains: What is ‘traditional’ about traditional knowledge is not its antiquity, but the way it is acquired and used. In other words, the social process of learning and sharing knowledge, which is unique to each indigenous culture, lies at the very heart of its ‘traditionality’. Much of this knowledge is actually quite new, but it has a social meaning, and legal character, entirely unlike the knowledge indigenous peoples acquire from settlers and industrialized societies (Barsh, 1999, p73).
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In short, knowledge held and generated within ‘traditional’ societies can be new as well as old. People who point this out are likely to emphasize that TK has always been adaptive because adaptation is the key to survival in precarious environments. Consequently, while TK is handed down from one generation to another, this does not mean that what each generation inherits is what it passes on; TK develops incrementally, with each generation adding to the stock of knowledge. Similarly, while the traditional classical health systems of China, India, Japan and Korea are based upon ancient texts, these systems continue to evolve and many present-day innovations take place. This is demonstrated by the existence of numerous Chinese patents on refinements of ‘traditional’ medical formulations.2 Who owns knowledge in traditional societies? Is it the individual creator or holder? The leader or leaders of a community? The whole community? A group of people within a nation, tribe or community such as a clan or lineage group? Or alternatively, is traditional knowledge shared freely because traditional societies do not have concepts of property or at least do not apply these concepts to knowledge? Discussions on these questions are often characterized by tendentious and misleading generalizations. Even if we narrow the scope of our discussion to indigenous peoples such as those of the Amazon, Siberia or the Pacific, these questions defy easy answers. Many traditional communities have a strong sharing ethos, but this does not mean that everything is shared with everybody. This is confirmed by a wealth of anthropological literature which reveals that concepts such as ‘ownership’ and ‘property’ – or at least close equivalents to them – also exist in most, if not all, traditional societies.3 In fact, many traditional societies have their own custom-based ‘intellectual property’ systems, which are sometimes very complex. Customary rules governing access to and use of knowledge do not necessarily differ greatly from western intellectual property formulations, but in the vast majority of cases they almost certainly do. They also differ widely from each other. Therefore, to assume that there is a generic form of collective or community intellectual property rights (IPRs) would be misleading, since it would ignore the tremendous diversity of traditional proprietary systems. Despite this, it is often assumed that traditional knowledge is shared freely and that where property rights do exist, they are always collective in nature rather than individual as in the West. In some ways this view may do a disservice to traditional societies concerned about the misappropriation of TK. When TK that has been disclosed to non-members of a small community or group of people, it is usually considered to be in the public domain – unless its disclosure arose through illegal or deceptive behaviour by the recipient such as a breach of confidence. If no property rights exist, then whose rights are being infringed by somebody’s publishing this knowledge, commercially exploiting it or otherwise appropriating it? Arguably nobody’s. Of course, one may consider such behaviour to be unjust whether or not the knowledge is the property of the TK creator, holder or community. But it may become harder to justify this view if we overstate the case that TK is shared without restrictions.
96 Protecting Traditional Knowledge Having made this point, however, other arguments may still be deployed. One such argument derives from the problematic nature of the public domain concept, at least from the view of many traditional societies in which TKholders or others, such as tribal elders, have permanent responsibilities with respect to the use of knowledge irrespective of whether the knowledge in question is secret, is known to just a few people, or is known to thousands of people throughout the world. Custodianship responsibilities do not necessarily cease to exist just because the knowledge has been placed in the so-called public domain. And there is no doubt that a tremendous amount of TK has been disclosed and disseminated over the years without the authorization of its holders. In this context, the following observation about indigenous peoples by Barsh is revealing: Indigenous peoples generally think in terms of the freedom of individuals to be what they were created to be, rather than being free from certain kinds of state encroachments. Along with this highly individualized notion of ‘rights’ is a sense of unique personal responsibilities to kin, clan and nation. Each individual’s ‘rights’, then, consist of freedom to exercise responsibilities towards others, as she or he understands them, without interference (Barsh, 1995, p42). In short, indigenous societies often consider each member as having individual rights and collective responsibilities that are inextricably linked. Indeed, the reason why the formal IPR system is inappropriate may have at least as much to do with these responsibilities as with the supposedly collective nature of customary rights over TK. Besides, individual property rights over knowledge are not necessarily absent from many traditional societies, but these will often be accompanied by certain duties. Attribution is far from being a simple matter in many traditional societies. Many commentators, especially those supporting the rights of traditional peoples and communities in the developing world, emphasize the collective nature of creative processes in traditional societies, which they contrast with the individualistic view of creativity (and of ownership in the end-product of that creativity) that prevails in western societies. Such generalizations have some truth to them, but it is important not to exaggerate the differences either. The sources of a great deal of TK are difficult to trace, either because two or more peoples or communities share the knowledge, or because the originator is simply unknown. What of the perceptions of indigenous peoples and other traditional communities? Again, views vary widely. Some indigenous groups actually consider it presumptuous to attribute authorship to a human being or a group of people. According to the late ethnoecologist Darrell Posey, who spent many years studying and working with the Kayapó people of the Amazon, ‘indigenous singers ... may attribute songs to the creator spirit’ (1995, p17). Blakeney states: ‘if the beliefs and practices of Australian indigenous peoples are any guide, authorship may reside in pre-human creator ancestors… Authorship is replaced by a concept of interpretation through initiation’ (Blakeney, 2000, pp251–252). But for other groups, this may not be true at all.
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WHY PROTECT TRADITIONAL KNOWLEDGE? Apart from treaties and emerging international norms, which imply both legal and moral imperatives for protecting traditional knowledge, there are a number of reasons why developing countries may feel motivated to protect TK. These are set out below.
To improve the livelihoods of traditional knowledge holders and communities Some indigenous and local communities depend on TK for their livelihoods and well-being, as well as to sustainably manage and exploit their local ecosystems, for example through sustainable low-input agriculture. According to the World Health Organization, up to 80 per cent of the world’s population depends on traditional medicine for its primary health needs. For those comprising the poorest segments of developing-country societies, traditional knowledge is indispensable for survival (United Nations Conference on Trade and Development (UNCTAD), 2000). Increasingly, TK is being accepted as an important source of useful information in the achievement of sustainable development and poverty alleviation. Until the 1970s, development planning and conservation policies were usually based on very negative assumptions about traditional rural societies. Poor rural dwellers were generally assumed to be backward and inimical to change, and their livelihood practices, such as shifting cultivation, were thought to be, at best, inefficient and unproductive and, at worst, environmentally destructive. More enlightened attitudes towards the knowledge, skills and subsistence practices of rural communities in developing countries emerged in the 1970s, according to Adams (1990, p169): ‘as part of a liberal and populist reaction against the unsuccessful technological triumphalism of rural development practice’. These attitudes have become increasingly mainstream in academia and among international development and conservation agencies. Many multilateral and bilateral donor agencies, including the World Bank; United Nations agencies such as the FAO, UNESCO and UNEP; and several of the International Agricultural Research Centres now recognize and actively promote the role of traditional knowledge in sustainable rural development programmes (Warren, 1995). It appears that protecting TK would help local people to maintain livelihood security and physical well-being while providing opportunities for economic development. However, at a time when TK is enjoying a measure of mainstream acceptance it has not had before, human cultural diversity is eroding at an accelerating rate as the world steadily becomes more biologically and culturally uniform. According to the IUCN Inter-Commission Task Force on Indigenous Peoples (1997, p60), ‘cultures are dying out faster than the peoples associated with them. It has been estimated that half the world’s languages – the storehouses of peoples’ intellectual heritages and the framework for their unique understandings of life – will disappear within a
98 Protecting Traditional Knowledge century’. According to the Task Force, the main threats include genocide, uncontrolled frontier aggression, military intimidation, extension of government control, unjust land policies, cultural modification policies, and inappropriate conservation management. This suggests that measures to protect TK and the rights of TK-holders and their communities need to be implemented with some urgency.
To benefit national economies National economies benefit from TK and there is potential for further benefit. Such TK-based products as handicrafts, medicinal plants, agricultural products and non-wood forest products (NWFPs) are traded in both domestic and international markets and can provide substantial benefits for exporter countries. For example, some 150 NWFPs are traded internationally in significant quantities (UNCTAD, 2000). The total value of the world NWFP trade is in the order of US$11 billion (FAO, 1995). Modern industries, such as pharmaceuticals, cosmetics, agriculture, dietary supplements, industrial enzymes, biopesticides and personal care also draw on TK. In most cases, virtually all the value added is captured by firms based in developed countries who can harness advanced scientific, technological and marketing capabilities. This situation needs to be addressed so that the developing countries can capture much more of the value added. However, one should not overestimate the industrial demand for in situ genetic resources and associated TK. While enhanced abilities to screen huge quantities of natural products and analyse and manipulate their DNA structures might suggest that bioprospecting will become more popular, it seems more likely that advances in biotechnology and new drug discovery approaches based, for example, on combinatorial chemistry and human genomics will, in the long term, reduce industrial interest in natural product research for food, agriculture and health, as well as associated TK. On the other hand, concerns about food safety and other unknown side effects of DNA-modified products may promote interest in natural product research, especially in organic agricultural products (UNCTAD, 2000). As we saw in Chapter 2, attempts have been made to estimate the contribution of TK, particularly biodiversity-related TK, to modern industry and agriculture. Such estimates suggest that the economic potential of TK is very high indeed. Nonetheless, estimating the full value of TK in monetary terms is difficult if not impossible. First, TK is often an essential component in the development of other products. Second, as many (and possibly most) TKderived products never enter modern markets, they are excluded from sectoral or GNP indices. However, if those who depend on TK-derived products were deprived of them, the cost of replacing them through purchases of substitutes in the market would probably be quite high, particularly as a portion of their incomes (UNCTAD, 2000). In short, it seems that protecting TK has the potential to improve the performance of many developing country economies through greater commercial use of their biological wealth and increasing exports of TK-related
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products. But at the same time, it is important not to overestimate the economic potential of TK either. Much of it has no commercial application whatsoever.
To conserve the environment That a conservation ethic is a prevalent feature of the subsistence and resource management practices of many present-day indigenous or native peoples and traditional communities is supported by a large number of field studies (eg Bodley, 1976; Clad, 1984; Martin, 1978; Reichel-Dolmatoff, 1976). But this view is sometimes dismissed as romanticism. Some anthropologists claim that in many such societies, this ethic either is not observed by many of their members or is entirely non-existent (eg Hames, 1991; Kalland, 1994). Ellen (1986) argues that the many traditional societies observed to impact minimally on the environment do so merely because they are the smallest and most isolated ones. Redford and Stearman (1993) also are sceptical of the ‘ecologically noble savage’ hypothesis (see also Redford, 1991). They feel it is inappropriate to generalize about native peoples and traditional communities and make broadly applicable assertions about their environmental values. They also argue that expecting them to continue using only traditional technologies and low-impact subsistence strategies places an unfair burden of responsibility on them and implicitly denies the right of such peoples to develop according to their own preferences. Nevertheless, academic studies of such communities provide ample evidence that the protection of traditional knowledge can provide significant environmental benefits. For example, in many forest areas, members of traditional societies plant forest gardens and manage the regeneration of bush fallows in ways that take advantage of natural processes and mimic the biodiversity of natural forests. Researchers are increasingly aware of the extent to which traditional natural resource management can enhance biodiversity and in this way have realized the extent of anthropogenic landscapes even within ‘pristine’ tropical forests (eg see Hecht and Posey, 1989; Posey, 1990). According to Oldfield and Alcorn (1991, p37) ‘much of the world’s crop diversity is in the custody of farmers who follow age-old farming and land use practices that conserve biodiversity… These ecologically complex agricultural systems associated with centres of crop genetic diversity include traditional cultivars or “landraces” that constitute an essential part of the world’s crop genetic heritage and non-domesticated plant and animal species that serve humanity in various ways’.
To prevent biopiracy The issue of biopiracy was the subject of Chapter 5. To many countries, the prevention of biopiracy seems to be the primary motivation for protecting TK. In conclusion, there are ample reasons for governments to take steps to legally protect traditional knowledge, as presented in Table 10.1. However, it cannot be emphasized enough that protection of TK cannot satisfactorily be dealt with in isolation from the more fundamental needs, interests and rights of
100 Protecting Traditional Knowledge Table 10.1 Reasons to protect traditional knowledge REASONS Moral
Legal
Utilitarian
To fulfil moral obligations towards indigenous/local communities
To comply with international treaties on biodiversity, plant genetic resources and human rights
For local economic, welfare (health and food security) and subsistence benefits
To prevent ‘biopiracy’
For national economic and welfare benefits For global economic and welfare benefits For improved sustainable management of biodiversity and conservation
the holders of TK, innovations, practices and technologies and their communities, such as land rights (Greene, 2002).
CAN INTELLECTUAL PROPERTY RIGHTS PROTECT TRADITIONAL KNOWLEDGE? The application of IPRs such as copyrights, patents and trade secrets (or undisclosed information) to TK protection presents a range of conceptual and practical challenges, which are presented below.
Copyright At the international level, the idea of applying copyright law to protect intangible cultural expressions, including those of traditional peoples and communities, dates back to the 1960s. The term commonly applied to such manifestations of culture was not TK but folklore, or ‘expressions of folklore.’4 The possibility of protecting folklore by means of copyright was raised at the Diplomatic Conference of Stockholm in 1967 for the revision of the Berne Convention for the Protection of Literary and Artistic Works. While the issue was not fully resolved, the following – and it must be said rather unsatisfactory – provisions were included in Article 15.4 of the Stockholm Act of the Convention, and retained in the most recent revision adopted in Paris in 1971: In the case of unpublished works where the identity of the author is unknown, but where there is every ground to presume that he is a national of a country of the Union, it shall be a matter for legislation in that country to designate the competent authority who shall represent the author and shall be entitled to protect and enforce his rights in the countries of the Union.
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Countries of the Union which make such designation under the terms of this provision shall notify the Director General [of the World Intellectual Property Organization (WIPO)] by means of a written declaration giving full information concerning the authority thus designated. The Director General shall at once communicate this declaration to all other countries of the Union. Over the years many traditional peoples and communities have condemned the unauthorized reproduction of their fixed and unfixed cultural expressions such as artistic works, handicrafts, designs, dances, and musical and dramatic performances. Not only do outsiders frequently neglect to ask permission to reproduce these items, but they also fail to acknowledge the source of the creativity, and even pass off productions and works as authentic expressions or products when they are not. Yet, traditional peoples and communities find it difficult to prevent such practices. Could the copyright provisions of TRIPS provide a solution? In Australia, Aboriginal artists have successfully sued on the basis of copyright infringement (see Box 10.1). Copyright law is also being used by the Dene of Canada, as well as several other indigenous groups worldwide, to control use by others of compilations of their TK (Greaves, 1996, p31). This suggests that, as developing countries fully comply with the levels of enforcement required by TRIPS, more and more peoples and communities will be able to avail themselves of copyright protection. Despite these successes, copyright law has some fundamental limitations in the folklore context. First, whereas copyright requires an identifiable author, the notion of authorship is a problematic concept in many traditional societies. Second, copyright has a time limit, whereas for folkloric expressions that are important elements of people’s cultural identity it would be more appropriate to have permanent protection. Third, copyright normally requires works to be fixed. Frequently, folkloric expressions are not fixed but are passed on orally from generation to generation, and this normally excludes such expressions from eligibility for copyright protection. With respect to the first problem, authorship, many experts emphasize the collective nature of creative processes in traditional societies, which they contrast with the individualistic view of creativity (and of ownership in the end-product of that creativity) that prevails in western societies. The sources of much TK and folklore are difficult to trace, either because the knowledge is shared by two or more peoples or communities, or because the author is simply unknown. And, as we saw earlier, for some traditional peoples and communities it would be presumptuous to attribute authorship to a human being anyway. It also needs to be borne in mind that intra-community conflicts can arise between the interests of indigenous artists and community elders with respect to the use, dissemination and further development of artistic works. Nonetheless, this does not mean the possibility of using copyright should be discounted completely. In fact, it is not essential to name an author to acquire copyright protection. Indeed, the copyright industries have – with the help of supportive copyright legislation – devised ways of making authors disappear.
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BOX 10.1 SOME COPYRIGHT CASES IN AUSTRALIA INVOLVING ABORIGINAL ARTWORKS Aboriginal art is now a major source of income for many communities in Australia. The art industry provides employment for thousands of people, including artists and employees of art centres where the works are sold. According to Golvan (1992, p227), ‘The works of Aboriginal artists have become our national artistic symbols. It has become inconceivable for any major public building to be opened today which does not feature some Aboriginal art.’ Unfortunately, there have been many cases of non-Aboriginal people producing distorted and trivialized versions of Aboriginal artworks. In some instances such acts have been challenged in the courts.
Bulun Bulun vs Nejlam Pty Ltd In 1989, John Bulun Bulun, who had discovered that a T-shirt manufacturer had printed shirts displaying an unauthorized reproduction of two of his paintings, sued for copyright infringement. The company and two shops that had sold the T-shirts agreed in court to withdraw them from sale. Later, 14 other artists brought claims against the same company. These cases were settled out of court with the artists receiving $AU150,000 in compensation and to cover their costs.
Milpurruru vs Indofurn Pty Ltd This 1995 case involved the unauthorized importation and sale by an Australian firm of carpets manufactured in Vietnam on which had been reproduced the designs of three living and five deceased Aboriginal artists. The plaintiffs’ claim was that the company had violated the Copyright Act of 1968’s prohibition on parallel importation of copyrighted works (Puri, 1998). The action of the company did not cause economic loss to the artists, since they had no intention of commercializing these works anyway. However, because they had failed to prevent these works of deep cultural and spiritual significance from being reproduced in this way, the artists had breached customary law and might have been subjected to chastisement and possibly severe punishment from the traditional custodians of the stories being depicted in the designs. The fact that the plaintiffs won the case was by no means the most significant outcome. More importantly, the judge awarded additional damages on the basis not only that the firm had been guilty of a particularly flagrant disregard of the artists’ rights, but also ‘to reflect the harm suffered [by them] in their cultural environment’. According to Blakeney (1998, p988) this case ‘establishe[d] the principle that where the unauthorized reproduction of such works involved a breach of copyright, customary Aboriginal laws on the subject may be taken into account in quantifying the damage which had been suffered’.
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Bulun Bulun vs R & T Textiles Pty Ltd This 1998 case related to the infringement of an Aboriginal artist’s copyright in a work known as ‘Magpie Geese and Water Lilies at the Waterhole’. The case was brought by the artist John Bulun Bulun and by George Milpurrurru, both of whom belong to the Ganalbingu people. Milpurrurru claimed that the Ganalbingu were equitable owners of the copyright. While the respondents admitted to infringing Bulun Bulun’s copyright, the real significance of the case was that the artist was held to be under fiduciary obligation to his community as to the use of the material. Specifically, the court imposed the obligation on Bulun Bulun ‘not to exploit the artistic work in such a way that is contrary to the laws and customs of the Ganalbingu people, and, in the event of infringement by a third party, to take reasonable and appropriate action to remedy infringement of the copyright in the artistic work’.
For example, this can be achieved in the US by taking advantage of the workfor-hire doctrine (se Jaszi, 1991, pp485–491) or, as in the UK, requiring authors to waive their moral rights.5 As a result, a community or organization representing the work could likewise hold copyright over a work originating in that community whether or not there is an identifiable author. Turning to the second problem, copyrights have time limits and most people would probably agree that it is a good thing they do. For many traditional peoples and groups, however, certain expressions and works are central to their cultural identity and should therefore never be fully released into the public domain, at least not to the extent that others would be free to do whatever they like with them. This is not to say that copyright protection should be permanent for culturally significant expressions and works, but that copyright law is simply not the appropriate approach. As for the third requirement, fixation, it is true that copyright protects works in physical form and not unfixed expressions. Since communities often lack the means to record their cultural expressions, they cannot acquire copyright protection. But this bar to protection can be removed with the will to do so. Several countries have incorporated protection of folkloric expressions into their national copyright laws. These include Tunisia in 1967, Bolivia in 1968 and Kenya in 1975. Given the way copyright has been transformed to, for example, treat computer programs as literary works, it hardly seems radical to extend the definition of copyrightable subject matter to unfixed cultural expressions or even to create a new IPR based on copyright for such an end.6 However, the most powerful actors in international IPR negotiations are still resistant to the idea of modifying international copyright rules to more effectively protect folklore. And, to date, developing-country proposals to reform TRIPS to protect TK have paid little attention to copyright. Unfixed cultural expressions can, to a limited extent, also be protected under performers’ rights in cases where performances have been fixed without
104 Protecting Traditional Knowledge the authorization of the original performers. The 1961 Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations is partially incorporated in TRIPS, allowing performers to prevent the recording and reproduction of their performance on a phonogram, and the broadcast and public communication of a live performance. But neither the Rome Convention nor TRIPS makes any reference to folklore. However, the 1996 WIPO Performances and Phonograms Treaty defines ‘performers’ as ‘actors, singers, musicians, dancers, and other persons who act, sing, deliver, declaim, play in, interpret, or otherwise perform literary or artistic works or expressions of folklore’. It is possible that a future revision of TRIPS will incorporate this treaty. Nonetheless, the scope of protection is quite narrow. Apart from these theoretical difficulties, there are practical obstacles, too. For example, the entity wishing to assert its copyright – or indeed to claim any other IPR – must have a legal personality. Collective groups such as rural communities and smaller groups within communities rarely have the status of being juristic persons according to a national legal system.
Patents Blakeney (1999) notes that while folklore tends to be discussed in copyright terms, when it comes to traditional knowledge, the discourse shifts from copyright towards patent law and biodiversity. Can patent law, despite the problems with patents discussed in Chapter 5, provide promising solutions? The general feeling is that it cannot, with four main objections being given. These are that traditional knowledge is collectively held and generated while patent law treats inventiveness as an achievement of individuals; patent applicants must supply evidence of a single act of discovery; patent specifications must be written in a technical way that examiners can understand; and applying for patents and enforcing them once they have been awarded is prohibitively expensive. The merits of each objection are considered below. It is often asserted that because TK is collectively held and generated, patent law is fundamentally incompatible. This is because patents require that an individual inventor be identifiable. Yet while TK is merely part of the public domain, a new and non-obvious modification to this knowledge achieved by an individual can be the subject of a patentable invention. Although modern patent law and doctrine has accommodated the collective notion of inventiveness since the late 19th century, the requirement to name inventors remains. But it is not actually true that TK is by definition in the public domain or collectively held and generated. Many of the 10,000 ‘grassroots innovations’ documented by the India-based Honey Bee Network are attributed to and claimed by individuals (see Chapter 14). Nonetheless, the requirement to name inventors is a serious obstacle in many cases. While there need be no demonstrable ‘flash of genius’, patent specifications must nonetheless provide evidence of an inventive step or an act that would not be obvious to one skilled in the art. Applying the same criteria to TK would exclude much of it from patentability. But the same is true of western scientific
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knowledge, much of which is just as cumulative and equally unpatentable. So this may not be a valid objection to the patent approach. Patent specifications must be written in a technical way that examiners can understand. For TK-holders this would mean hiring a patent attorney to translate their knowledge into technical terminology. This is likely to be too expensive. The lack of economic self-sufficiency of many traditional communities, the unequal power relations between them and the corporate world, and the high cost of litigation, would make it very difficult for them to protect and enforce their IPRs through the patent system. In the US, for example, it costs about $20,000 to prepare and prosecute a patent application, including legal and filing fees (Barton, 1999, p127). This is well beyond the financial means of most communities. Even though patent fees in some jurisdictions may be reduced for small and medium-sized enterprises, the cost of acquiring a patent is still likely to be prohibitive. On the face of it, the use of patent law has some genuine possibilities. Among the options that might be considered are: traditional peoples, communities or their representative organizations could apply for patents; they could share ownership with companies who would apply on their behalf; or companies could file patents, but with community members named as inventors possessing contractual rights of compensation. Nevertheless, most traditional peoples and communities seem to be fundamentally opposed to patents, and few – if any – are rushing to patent offices to submit their applications (or are likely to do so in the future). There are various reasons why traditional peoples and communities are sceptical that patent law can be utilized to further their interests. Some of these are practical while others are ideological. The main practical difficulty that deters traditional peoples and communities from filing patents is the expense of doing so, including payments to the patent attorney hired to complete the application, and the filing, prosecution and renewal fees. Legally enforcing the patent against infringers is likely to be even more expensive.
Trade secrets While the sharing of knowledge is common in many traditional societies, healers and other specialist knowledge-holders as well as clans and lineage groups are likely to have knowledge that they will not wish to share with anyone. Trade secret protection, however, does not necessarily require that knowledge be known only by a small number of people. According to a 1993 report of the Congressional Research Service, ‘if a shaman or other individual has exclusive access to information because of his status in the group, that individual or the indigenous group together probably has a trade secret’ (Axt et al, 1993, p63). If a company obtains such information by illicit means, legal action may then be used to force the company to pay compensation. Conceivably, a considerable amount of TK could be protected under trade secret law. An experimental project based in Ecuador and supported by the InterAmerican Development Bank is currently trying to protect TK as trade
106 Protecting Traditional Knowledge secrets (Vogel, 1997b). The project, entitled ‘transforming traditional knowledge into trade secrets’, aims to enable traditional peoples and communities to benefit from bioprospecting through effective trade secret protection of their knowledge. An NGO called Ecociencia is documenting the botanical knowledge of the participating indigenous groups, and registering it in closed-access databases. Checks are made to see whether each entry is not already in the public domain and whether other communities have the same knowledge. If an entry is not in the public domain, the community or communities with the knowledge have a trade secret. The trade secret can then be disclosed to companies with benefit sharing guaranteed by a standardized contract. These benefits can then be distributed among the trade secret-holding communities and the Ecuadorian government. To date, the database contains 8000 entries provided by six participating indigenous groups. Sixty per cent of the uses appear not to have been disclosed through publications. So far, three companies have expressed interest in accessing the database.7 Thus, as developing countries implement the TRIPS section on undisclosed information, the possibility exists for trade secrecy to be deployed as a means to protect TK and to realize its commercial potential for the benefit of the knowledge holders and their communities (see Chapter 11 for a proposal to take better advantage of this part of TRIPS to protect TK).
Trade marks One kind of trade mark that exists in the laws of some countries is the certification trade mark. Certification marks can be used by small-scale producers to guarantee to customers that goods are genuine in some way, and perhaps to support production that is conducted in an environmentally sustainable manner. Certification marks indicate that the claims made by the traders have been authenticated by an organization independent of the individual or company making or selling the product. This is likely to be a regional trade association that has registered its own collective mark. In Britain, the makers of a British cheese called Stilton are entitled to use the ‘Stilton’ certification trade mark. To be eligible, cheese must be produced in or near the village of Stilton, with the traditional ingredients, and in accordance with the traditional manufacturing techniques. Producers cannot use the mark if they fail to conform to these conditions of manufacture (Dutfield, 1997, p:19). In the US, the Intertribal Agriculture Council licenses use of its annually renewable ‘Made by American Indians’ mark for the promotion of agricultural or other Indian-made products that have been produced and/or processed by enrolled members of recognized Tribes. However, labelling has been unsuccessful in some US states in terms of promoting trade in indigenous peoples’ products. This may be because customers are unaware of the marks, do not care whether the articles they purchase are genuine (Axt et al, 1993, p46), or are confused by the labels. These problems illustrate the difficulties that can arise from the use of trade marks, certification and geographical indications for manufactured goods and artwork.
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Nevertheless, they can be successful marketing strategies, especially if traders have a clear understanding of why people wish to buy their articles.
Geographical indications Although the use of geographical indications (GIs) has been confined mainly to certain beverages and foodstuffs, the principles of GIs could guide laws to protect certain traditional know-how and help to maintain the economic value of locally produced goods, including herbal formulations. To illustrate the potential of GIs, it is interesting to consider how this IPR could be used to protect basmati rice (Box 10.2).9
Plant variety protection It is sometimes suggested that since traditional farmers are often breeders as well, they should be able to acquire plant variety protection (PVP) certificates in the same way as formal professional plant breeders. It is certainly easier and less expensive to acquire a plant variety right than a patent.10 However, the uniformity and stability requirements mean that only breeders of genetically uniform varieties can use the system. Landraces tend to be genetically quite diverse. This makes it difficult to class them as ‘varieties’ as such. This point becomes evident when we bear in mind that, according to the International Code of Nomenclature for Cultivated Plants,11 a ‘cultivar’ (ie cultivated variety) is distinct, uniform and stable. Similarly, in many jurisdictions, and Europe is a good example of this, a variety that is not distinct, uniform and stable is not a plant variety as far as the law is concerned. But having said all this, there is very little evidence that local communities are interested in acquiring PVP for their landraces anyway.
Utility models As Suthersanen (2001, p320) explains: ‘the term “utility model” is a generic term which is usually reserved for the protection of technical ideas and inventions which cannot fulfil the patentability criteria’. The main differences from patents are that the inventive step requirement tends to be low, the term of protection is shorter, and there is often no examination for novelty and inventive step. National utility model systems vary quite widely because there are no international agreements or conventions to standardize them to any significant extent. They are not referred to in TRIPS. Juma (1989, pp231–232) gives five reasons why utility models are appropriate for many developing countries. The first is that they enable artisans to secure protection for innovations that do not meet the stricter novelty and inventive step requirements of patent law. Second, they make it possible to increase the role of traditional innovators and artisans in economic development and help them stay in business in the face of new technologies that might threaten their livelihoods. Third, they act as a spur to enhanced levels of innovation. Fourth, they are cheaper to acquire than patents. And finally,
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BOX 10.2 COULD BASMATI RICE BE PROTECTED BY A GEOGRAPHICAL INDICATION? Basmati rice is a long-grained aromatic rice variety cultivated in areas of Northern India and Pakistan. Basmati is exported to North America and Europe and commands a high price on account of its high quality and, most probably, its authenticity. Two corporations in France and the US have been actively appropriating the high reputation of basmati rice and are, in this way, threatening a lucrative market for India and Pakistan. A food company called Etablissements Haudecoeur La Courneuve has been granted two French trade marks using the word ‘Basmati’: ‘Riz Long Basmati’ and ‘Riz Long Basmati Riz du Monde’ (Economic Times, 1998), and a US company called RiceTec has for several years been selling rice in the US and the Middle East under the name ‘Texmati’. In 1999, the Indian government passed legislation on GIs. Given that TRIPS does not require a WTO member to protect GIs unless they are protected in their country of origin, this was necessary. But will it help? Most probably India cannot challenge use of the name ‘Texmati’, which connotes Texas more strongly than it does the Indian subcontinent. But what about the name ‘basmati’? Success would depend upon rejection of any claims that basmati is a generic term, and acceptance of the argument that basmati is a variety of rice made distinctive, not only by its inherent qualities, but also by its geographical origin and local knowhow. The taste and quality of basmati rice, but above all its reputation (since these are to some extent subjective attributions), must be inextricably linked to its place of origin. If consumers in countries where basmati is sold do not associate basmati rice with the Indian subcontinent, then ‘basmati’ is not protectable as a GI, and may even have become a generic term for a type of long-grained fragrant rice. But one of the major difficulties is that basmati is not a geographical expression per se. In addition, Pakistan and India disagree on the meaning of ‘basmati’. According to Pakistan, authentic basmati must be grown in Punjab. India argues that the exact location is not so important as long as it is cultivated near the foothills of the Himalayas. The Indian government appeared to make no attempt to use the existing regulations to protect the basmati name in the US. Instead this was left to two US NGOs and an Indian one, which together unsuccessfully petitioned the US Department of Agriculture and the Federal Trade Commission to preserve the basmati name for certain varieties of aromatic rice grown in India and Pakistan (and also jasmine rice for aromatic rice from Thailand). The best way for basmati rice growers to increase exports and secure good prices is not through litigation but through effective marketing, which could be assisted greatly by the use of certification or collective trade marks if not of GIs.
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they may become a source of data on innovative activity and experience in technological management. It is noteworthy that in Kenya, utility models are available for ‘microorganisms or other self-replicable material, herbal as well as nutritional formulations which give new effects’. However, up to 2000 no applications had ever been filed. Overall, IPRs do not appear to provide many opportunities of which traditional peoples and communities can avail themselves. On the contrary, framing the issue of TK protection in the discourse of western intellectual property rights does not go very far unless it is embedded in much broaderbased negotiations between traditional peoples and communities, national governments, businesses and scientists in which the most fundamental concerns of these peoples and communities, such as self-determination (for indigenous peoples), territorial rights and human rights, are openly and comprehensively addressed.
Chapter 11 ALTERNATIVE APPROACHES TO TRADITIONAL KNOWLEDGE PROTECTION
Legal solutions to the protection of traditional knowledge (TK) may be sought in terms of ‘positive protection’ and ‘defensive protection’. To many countries and non-governmental organizations (NGOs), defensive protection is necessary because the intellectual property system, and especially patents, is considered defective in certain ways and allows companies to unfairly exploit TK. It may also be true that defensive protection may be more achievable than positive protection in practice. This is because some of the most commonly discussed defensive protection measures are basically enhancements to or modifications of existing intellectual property rights (IPRs). Effective positive protection is likely to require a completely new system, whose development will require the very active and committed participation of many governments. The problem for advocates of positive protection is the lack of existing models. Several have been proposed, and these are presented in this chapter, but none has ever been tested. Few countries have enacted sui generis protection for TK, but one which has is Peru and the legislation of that country is presented here.
DEFENSIVE PROTECTION Two important proposals have come out of international negotiations to provide defensive protection of TK through the patent system. The first is to require patent applicants to disclose the origin of genetic resources and associated TK relevant to the invention and, according to one variant of the proposal, to provide proof that regulations governing the transfer of the resources and associated TK were complied with. Disclosure of origin is usually proposed as a means to make patent rules compliant with the principle of national sovereignty, but is also seen by proponents as a means of preventing TK from being misappropriated. The second is to compile databases of published information on TK for patent examiners to identify potentially novelty-destroying prior art. In addition, a promising alternative approach may be to develop a misappropriation regime.
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Disclosure of origin The compulsory disclosure of genetic resources and associated TK in patent applications was originally mooted by civil society organizations. The proposal is intended to help realize fair and equitable benefit sharing as required by the Convention on Biological Diversity (CBD). It is supposed to do this by ensuring that the resources and, in some cases, TK were acquired in accordance with biodiversity access and benefit sharing regulations in the source countries, and also Article 8(j). Proposals relating to disclosure have weak, medium and strong forms. The weak form is that such disclosure would be encouraged or even expected but not required and its omission would not disqualify the patent from being granted. The medium form is that disclosure of origin would be mandatory. The International Chamber of Commerce (ICC) supports the weak version (2002), which was adopted in the 1998 European Union Directive on the Legal Protection of Biotechnological Inventions. Recital 27 states that: Whereas if an invention is based on biological material of plant or animal origin or if it uses such material, the patent application should, where appropriate, include information on the geographical origin of such material, if known; whereas this is without prejudice to the processing of patent applications or the validity of rights arising from granted patents.1 It is interesting to note that Belgium is seeking to implement Recital 27 by linking compliance with the CBD to requirements that exploitation of an invention not be contrary to ordre public and morality. In 2000, a draft proposal to modify the 1984 Belgian Patent Act was prepared that ‘stipulates that the exploitation of an invention is contrary to ordre public and morality when the invention is developed on the basis of biological material that was collected or exported in breach of Articles 3,2 8(j), 15 and 16 of the CBD’ (van Overwalle, 2002, p234).3 In addition, ‘a patent application should contain, not only a formal request, a description, one or more claims, drawings and an abstract, but also the geographical origin of the plant or animal material on the basis of which the invention was developed’ (van Overwalle, 2002, p234). India has actually introduced the medium form into the Patents (Amendment) Act, 2002, which adds two new grounds for revocation: that patents may be revoked on the ground ‘that the complete specification does not disclose or wrongly mentions the source or geographical origin of biological material used for the invention’, and ‘that the invention so far as claimed in any claim of the complete specification was anticipated having regard to the knowledge, oral or otherwise, available within any local or indigenous community in India or elsewhere.’ In addition, a significant new item is added to the list of things that are not inventions within the meaning of the Act: ‘an invention which, in effect, is traditional knowledge or which is an aggregation or duplication of known properties of traditionally known component or components.’ Similarly, Article 31 of Brazil’s Provisional Measure No. 2.186-16 stipulates that:
112 Protecting Traditional Knowledge The grant of industrial property rights by the competent bodies for a process or product obtained using samples of components of the genetic heritage is contingent on the observance of this Provisional Measure, the applicant being obliged to specify the origin of the genetic material and the associated traditional knowledge, as the case may be. The strong form goes beyond disclosure in the patent specification to require – like the first of the new provisions being considered in Belgium – that patent applicants comply with the CBD’s access and benefit sharing (ABS) provisions. One way to implement this is to establish a certification of origin system according to which applicants would have to submit official documentation from provider countries proving that genetic resources and – where appropriate – associated TK were acquired in accordance with the ABS regulations, including conformity with such obligations as prior informed consent and benefit sharing. Applications unaccompanied by such documentation would automatically be returned to the applicants for re-submission with the relevant documentation.4 Two questions arise here. First, is compulsory disclosure of origin incompatible with TRIPS? Second, is compulsory disclosure actually a good idea? The answer to the first question depends on whether we are talking about the weak, medium or strong versions. Clearly there is no problem whatsoever with the weak version. As for the medium version, it is difficult to accept the view that this establishes another substantive condition. One can easily argue that such disclosure of TK is essential for a full description of how the invention came about and for clarifying the extent to which it builds upon the state of the art. As for the source of the genetic material, it is difficult to see why inventors should not be expected to indicate where they got it from. The medium and strong versions would seem to conflict with TRIPS if failure to conform would result in a rejection of the application. To one legal expert, the main issue is what the consequences of non-compliance with a disclosure requirement would be for the patent holder. If the consequence would be a rejection of the application or a post-grant revocation, there would be a conflict. Consequently, the way to avoid a conflict with TRIPS is not to make the disclosure requirement a condition for granting the patent but a condition for its enforceability after it has been granted (Carvalho, 2000). The expert suggests that framing the disclosure requirement as a condition for enforcement could be adopted multilaterally in the framework of the World Intellectual Property Organization (WIPO) and then, perhaps, incorporated into TRIPS. However, a careful application of the strong version may provide a more satisfactory resolution. There is no compelling reason at all why the compulsory submission of a document, such as a certificate of origin, would impose another substantive condition as long as it is not linked to determining the patentability of the invention. After all, examination and renewal fees normally have to be paid by patent applicants and owners, and TRIPS does not prevent them merely because they are not mentioned in the Agreement. Similarly, the submission of documentation attesting to the fact that the applicant had
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complied with the relevant ABS regulations, such as a certificate of origin, would be just another administrative requirement. In short, the following interpretation seems plausible: it would not be a violation of TRIPS for countries to require patent applicants to fulfil two conditions: to describe the relevant genetic material and TK in the specification and second to submit documentary evidence that the ABS regulations were complied with. But it probably would be a violation to require patent applicants also to disclose the geographical origin of the relevant genetic material and associated TK in the specification. Consequently, imposing such a requirement will entail a revision of TRIPS. Alternatively, these requirements could be introduced outside of the search and examination processes as administrative measures. The problem is that a patent applicant may be tempted to omit disclosure of the relevant TK. There is no particular reason for an examiner to suppose that a given invention is based on TK unless the applicant discloses the fact. So, in most cases, his or her suspicions are unlikely to be aroused and the patent will then be granted assuming it is deemed to fulfil the normal requirements. Turning to the second question, mandatory disclosure could probably operate quite well for resources with health applications, especially pharmaceuticals. The pharmaceutical industry generally bases its new drugs on single compounds. Tracing and declaring the sources of these should not normally be a particularly onerous task. The measure would still need to determine the extent to which the obligation would extend to synthetic compounds derived from or inspired by lead compounds discovered in nature. But in the case of plant varieties, which can be patented in some countries, genetic material may come from numerous sources, some of which may no longer be identifiable because of the lack of documentation and the length of time between its acquisition and its use in breeding programmes. Since new varieties may be based on genetic material from many different sources, the value of individual resources is relatively low. In addition, the seed industry is much smaller than the pharmaceutical industry and will never generate as many benefits to share. Therefore, for plant varieties developed through conventional breeding methods, the system may be unworkable and may not necessarily benefit developing countries if it were. The patent applicants may be unable to comply and the examiners would not be in a position to verify whether the identities of the countries and indigenous communities of origin have been fully disclosed and are the true ones. It is also possible that the requirement could reinforce the tendency for plant breeders to rely on material in existing collections rather than to search for hitherto undiscovered resources from the countries of origin. This would have the effect of increasing the genetic uniformity of new plant varieties. The FAO International Treaty on Plant Genetic Resources for Food and Agriculture may offer a solution. This is because facilitated access to plant genetic resources for food and agriculture of those crop species covered under the multilateral system is to be subject to a standard material transfer agreement (MTA), which, as we saw earlier, will require benefits to be shared from the use, including commercial use, of the resources acquired.
114 Protecting Traditional Knowledge As for the certification of origin system, one of the practical complications is that many countries still do not have ABS regulations. In effect, there would be no appropriate authority to provide the official documentation from the source country that must accompany the patent. In this case, presumably, the requirement for certification would have to be waived. But if so, what is to stop a company from claiming that a resource was obtained from such a country when it was actually collected illegally from another country that did have ABS regulations? In short, mandatory disclosure and certification of origin are promising ideas that can help enhance compatibility between the CBD and the patent system. But the practicalities still need to be thought through carefully.
Traditional knowledge prior art databases India has been strongly in favour of TK databases and has already begun to develop a Traditional Knowledge Digital Library (TKDL), which is a searchable database of information already documented that relates to traditional Ayurvedic health knowledge and the medicinal plants used by Ayurvedic practitioners (see Chapter 14). The Indian government wants to make the TKDL available to patent examiners in India and elsewhere. Clearly, the question of TRIPS incompatibility does not arise. Such databases would simply be used to improve the efficiency of prior art searches. But would TK databases actually be useful? They could certainly stop patents like the notorious turmeric patent from being granted. It is by no means certain, however, that they would have prevented other controversial patents. They may have narrowed their scope but even this is by no means certain. How would TK have to be described in order to constitute novelty-destroying prior art? Let us consider the example of a patented therapeutic compound isolated from a medicinal plant. Most likely, the examiner will treat the TK relating to the plant as being quite distinct from the chemical invention described in the specification. In this context, it is important to note that national and regional patent laws vary with respect to how information or material in the public domain should be presented or described in order that it constitutes novelty-defeating prior art. For example, the European Patent Convention (EPC) considers an invention ‘to be new if it does not form part of the state of the art’, which is ‘held to comprise everything made available to the public by means of a written or oral description, by use, or in any other way, before the date of filing of the European patent application’. This indicates that articles which are publicly available may form the state of the art whether or not they have been described in writing or even orally. In this context, it is noteworthy that the EPO Technical Board of Appeal has ruled that ‘the concept of novelty must not be given such a narrow interpretation that only what has already been described in the same terms is prejudicial to it… There are many ways of describing a substance’. Furthermore, as two legal authorities explain, ‘the information disclosed by a product is not limited to the information that is immediately apparent from looking at the product. Importantly, the information available to the public also
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includes information that a skilled person would be able to derive from the product if they analysed or examined it’ (Bently and Sherman, 2001, p420). This might suggest that patents on isolated therapeutic compounds from medicinal plants may be vulnerable to a challenge on the basis of lack of novelty. However, one should also be cautious about this because ‘any information that is obtained as a result of an analysis undertaken by a person skilled in the art must be obtained without undue burden or without the need to exercise any additional inventive effort’. This analysis of how Europe defines and assesses novelty-defeating prior art suggests that many so-called biopiracy cases could not be legally challenged there, and that TK databases will make little difference.
Misappropriation regime Correa has proposed the development of a misappropriation regime. According to his proposal, ‘national laws would be free to determine the means to prevent it, including criminal and civil remedies (such as an obligation to stop using the relevant knowledge or to pay compensation for such use), as well as an obligation to stop using the relevant knowledge or to pay compensation for such use), as well as how to empower communities for the exercise and enforcement of their rights’ (2001b, p18). He recommends that in view of the lack of experiences to date in developing such a regime, a step-by-step approach may be necessary. In the first instance, such a regime should contain three elements: documentation of TK; proof of origin of materials; and prior informed consent. Correa refers to two United Nations documents that implicitly support his proposal. The first of these is CBD-COP Decision V/16, which: Request[ed] Parties to support the development of registers of traditional knowledge, innovations and practices of indigenous and local communities embodying traditional lifestyles relevant for the conservation and sustainable use of biological diversity through participatory programmes and consultations with indigenous and local communities, taking into account strengthening legislation, customary practices and traditional systems of resource management, such as the protection of traditional knowledge against unauthorized use. The second is the ‘Principles and Guidelines for the Protection of the Heritage of Indigenous Peoples’, which were elaborated in 1995 by Erica-Irene Daes, then Special Rapporteur of the UN Subcommission on Prevention of Discrimination and Protection of Minorities. Paragraphs 26 and 27 state the following: National laws should deny to any person or corporation the right to obtain patent, copyright or other legal protection for any element of indigenous peoples’ heritage without adequate documentation of the free and informed consent of the traditional owners to an arrangement for the sharing of ownership, control, use and benefits.
116 Protecting Traditional Knowledge National laws should ensure the labelling and correct attribution of indigenous peoples’ artistic, literary and cultural works whenever they are offered for public display or sale. Attribution should be in the form of a trademark or an appellation of origin, authorized by the peoples or communities concerned. Arguably, such a misappropriation regime could and probably should incorporate: the concept of unfair competition; moral rights; and cultural rights. Unfair competition would deal with situations in which TK-holders engaged in commercial activities – relating, for example, to know-how, medicinal plants, artworks or handicrafts – had their trade affected by certain unfair commercial practices committed by others. According to Article 10bis of the Paris Convention, the following acts are prohibited on the grounds of constituting unfair competition: 1 2 3
all acts of such a nature as to create confusion by any means whatever with the establishment, the goods, or the industrial or commercial activities, of a competitor; false allegations in the course of trade of such a nature as to discredit the establishment, the goods, or the industrial or commercial activities, of a competitor; indications or allegations the use of which in the course of trade is liable to mislead the public as to the nature, the manufacturing process, the characteristics, the suitability for their purpose, or the quantity, of the goods.
It is noteworthy that the TRIPS Agreement explicitly mentions Article 10bis in the sections dealing with geographical indications and undisclosed information. Specifically, World Trade Organization (WTO) members must provide the legal means to prevent any use of geographical indications that would constitute unfair competition. Also, members must ensure effective protection against unfair competition with respect to undisclosed information. Moral rights are provided in Article 6bis of the Berne Convention, and usually consist of the rights of authors to be identified as such (sometimes referred to as the right of paternity), and to object to having their works altered in ways that would prejudice their honour or reputation (the right of integrity).5 It could be argued that free-riding on the knowledge and cultural works and expressions of traditional communities who are not themselves interested in commercializing them does no direct harm. Consequently, misappropriation does not apply to such acts. But is it really the case that there are no victims? One could argue that such behaviour infringes on certain cultural rights that these communities are entitled to enjoy. Prott (1988) identifies a set of individual and collective rights that could be described as ‘cultural rights’, and which are supported to a greater or lesser extent by international law. Of these, the following (of which only the first is an individual right) stand out in light of the present discussion: the right to protection of artistic, literary and scientific
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works; the right to develop a culture; the right to respect of cultural identity; the right of minority peoples to respect for identity, traditions, language and cultural heritage; the right of a people to its own artistic, historical and cultural wealth; and the right of a people not to have an alien culture imposed on it. So to the extent that unauthorized or improper use of a cultural group’s artefacts and expressions imbued with cultural, spiritual or aesthetic value erodes the integrity of the culture of origin, it is reasonable to treat such uses as manifestations of misappropriation that the law should arguably provide remedies for.
POSITIVE PROTECTION Entitlement theory and experience to date both suggest that extant legal systems for protecting knowledge and intellectual works tend to operate as either property regimes, liability regimes, or as combined systems containing elements of both. Perhaps a consideration of these is a good way to start. What is the difference between property and liability regimes? A property regime vests exclusive rights in owners, of which the right to refuse, authorize and determine conditions for access to the property in question are the most fundamental. For these rights to mean anything, it must of course be possible for holders to enforce them. A liability regime is a ‘use now, pay later’ system, according to which use is allowed without the authorization of the right-holders. But it is not free access. Ex-post compensation is still required. A sui generis system based on such a principle has certain advantages in countries where much of the TK is already in wide circulation but may still be subject to the claims of the original holders. Asserting a property right over knowledge is insufficient to prevent abuses when so much traditional knowledge has fallen into the public domain and can no longer be controlled by the original TK-holders. A pragmatic response is to allow the use of such knowledge, but to require that its original producers or providers be compensated. There are different ways the compensation payments could be handled. The government could determine the rights by law. Alternatively, a private collective management institution could be established which would monitor use of TK, issue licences to users, and distribute fees to right-holders in proportion to the extent to which their knowledge is used by others. They could also collect and distribute royalties where commercial applications are developed by users and the licences require such benefits to go back to the holders. Such organizations exist in many countries for the benefit of musicians, performers and artists. Alternatively, in jurisdictions in which TKholders are prepared to place their trust in a state or government-created competent authority to perform the same function, a public institution could be created instead. While such organizations have the potential to reduce transaction and enforcement costs, considerations of economic efficiency should not be the
118 Protecting Traditional Knowledge only criteria for designing an effective and appropriate sui generis system. TKholders and communities will be its users and beneficiaries. They will not be interested in a system that does not accommodate their world views and customs but rather imposes other norms with which they feel uncomfortable and wish to have no part. Clearly, TK-holders and communities must be partners in the development of the sui generis system to avoid the development of an inappropriate and unworkable system. There will, of course, be objections from those who would oppose a liability regime on the principle that we should not have to pay for public domain knowledge. This view may be countered by saying that ‘the public domain’ is an alien concept for many indigenous groups. Just because an ethnobiologist described a community’s use of a medicinal plant in an academic journal without asking permission, this does not mean that the community has abandoned its property rights over that knowledge or its responsibilities to ensure that the knowledge is used in a culturally appropriate manner. Seen this way, a liability regime should not be considered an alternative to a property regime but as a means to ensure that TK-holders and communities can exercise their property rights more effectively. Whichever approach is selected – and a combination of both is probably essential – the question arises of whether rights must be claimed through registration, or whether the rights exist in law irrespective of whether they are filed with a government agency. It seems only fair that the rights should exist regardless of whether they are declared to the government and that these rights should not be exhausted by publication unless the holders have agreed to renounce their claims. Yet, protection and enforcement would probably be more effective with registration. In addition, knowledge transactions would become much easier to conduct if claims over TK were registered. Consequently, the sui generis system should encourage the registration of rights claims but not make this a legal requirement for protection. Finally, it must be cautioned that devising the most sophisticated and elaborate system is useless if the potential users and beneficiaries are unaware of its existence and/or have more immediate concerns such as extreme poverty, deprivation and societal breakdown caused by the insufficient recognition of their basic rights.
Peru’s Regime of Protection of the Collective Knowledge of Indigenous Peoples Very few countries have passed legislation providing positive protection for TK. One of the few is Peru, which in 2002 passed legislation known as the Regime of Protection of the Collective Knowledge of Indigenous Peoples. The legislation was drawn up by a Peruvian government agency, INDECOPI (National Institute for the Defence of Competition and Intellectual Property), to protect the collective knowledge of the indigenous peoples of that country. The idea for national legislation to protect TK did not emerge out of thin air.6 In this context, it is important to point out that the Andean Community, of which Peru is a member, had in 1996 adopted a Common System on Access to
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Genetic Resources (see Chapter 13). This regime, whose elaboration had involved an unprecedented level of participation from civil society, sought inter alia to establish a basis for recognizing and appreciating genetic resources, their derivatives and related ‘intangible components’. The intangible component means any knowledge, innovation or practice (individual or collective) of actual or potential value associated with a biogenetic resource or derivative whether or not it is protected by intellectual property rights. The eighth interim measure of Decision 391 suggests the idea of harmonizing standards ‘to provide greater protection of the knowledge, innovations and traditional practices of indigenous, Afro-American and local communities’. At about the time of adopting the Common System, a bioprospecting project in the Amazon involving Searle (then the pharmaceutical arm of Monsanto) and the Aguaruna people attracted a great deal of controversy, drawing attention both to the commercial potential of traditional knowledge and bioprospecting partnerships involving indigenous peoples and the private sector, and also to the possibility of exploitation. In January 1996, the Peruvian Society for Environmental Law (SPDA) and the advisors to the Aguaruna in their negotiations with Searle and Washington University (another party in the bioprospecting agreement), all of whom had been involved in the Decision 391 process, approached INDECOPI to explain the benefits for the country of developing a system to protect TK. INDECOPI responded fairly promptly and, together with the Ministry of Agriculture, decided to establish several working groups, one of which was mandated to develop a legal framework for the protection of indigenous peoples’ knowledge. Further support for such an initiative followed in April that year with a Legislative Decree on Industrial Property, which included a provision calling for a special regime for the protection of knowledge of indigenous and ‘campesino’ (peasant) communities. The Working Group established by INDECOPI and the Ministry of Agriculture began its work to develop a draft law early in 1996. It consisted of representatives of INDECOPI, a number of government ministries, and two NGOs, one of which was the SPDA. At first, indigenous peoples had no representation. This situation changed after some of the working group members pointed out that this was an omission needing to be corrected. In April and May 1999, INDECOPI and the Technical Secretariat of Indigenous Affairs (SETAI) of the Ministry for Promotion of Women and Human Development (PROMUDEH) held two workshops with indigenous peoples to discuss the proposed legislation. The first took place in Lima, and the second in Urubamba. In April and May 1999, INDECOPI and PROMUDEH held two workshops with indigenous peoples to discuss the proposed legislation. INDECOPI also sent copies of the draft Regime to several indigenous communities of the Andean region to request their comments. In October the draft Regime was published with a request for comments and suggestions. Initially INDECOPI gave a 60-day deadline by which comments should be forwarded. This deadline was subsequently extended to 20 May 2000 following criticisms by some civil society organizations, including some representing indigenous peoples, that 60 days did not allow sufficient
120 Protecting Traditional Knowledge time. In August 2000 a slightly amended Regime was published along with the comments and suggestions on the earlier version made by government agencies, academics (both Peruvian and foreign), indigenous peoples’ organizations, politicians, environmental NGOs, a domestic business association and international organizations. The Regime aims specifically to protect the collective knowledge of indigenous peoples relating to the properties of biological resources. All other categories of traditional knowledge are excluded, as are traditional exchanges of knowledge among and between indigenous peoples, and use of knowledge associated with biological resources for the domestic market that have not been processed industrially. The collective knowledge of indigenous peoples forms part of their cultural heritage. Those who wish to access TK for scientific, commercial or industrial application are required to secure the prior informed consent of the holders of the knowledge. For commercial use or industrial application, a (non-exclusive) licence is required guaranteeing an access fee plus 0.5 percent of the value of future sales to go to a Fund for the Development of Indigenous Peoples. The Fund is intended to contribute to the development of indigenous peoples by funding community projects, and will be administered inter alia by individuals representing indigenous peoples’ organizations. With respect to knowledge in the public domain, indigenous peoples will still be able to make an agreement with and request compensation from outside parties. Again, 0.5 per cent of the value of sales of product developed from the knowledge must go to the Fund. A Register of Collective Knowledge will be created for which INDECOPI will take responsibility. The Register’s objectives are to: • •
preserve the collective knowledge of indigenous peoples; and provide the Competent National Authority with information enabling it to defend the interests of those communities or indigenous peoples that have registered their knowledge.
Access to the register will require written consent of the indigenous peoples who own specific knowledge of interest to those requesting access. In addition the Regime forsees the option for communities and peoples of developing their own registers independent of INDECOPI’s. Legal rights over knowledge are not dependent upon its existence in the register. But by including knowledge in the register, communities will, presumably, be in a better position to assert their rights to it.
Database rights Nuno Carvalho of WIPO has suggested that TK databases be protected under a special database right (Carvalho, nd). These days, there is tremendous interest in documenting TK and placing it in databases. But as Carvalho points out, traditional communities and TK-holders are rarely the ones responsible for compiling or holding the databases. Moreover, it might be presumed that they will wish to control access to and use of the information held in the databases,
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rather than the way this information is presented or expressed. For these reasons, copyright law does not provide an adequate solution. As Carvalho explains: ‘it is necessary to establish a mechanism of industrial property protection that ensures the exclusivity as to the use of the contents of the databases, rather than to their reproduction (copyright)’. The basis for his proposal may be found in Article 39.3 of TRIPS which deals with test or other data that must be submitted to government authorities as a condition of approving the marketing of pharmaceutical or agrochemical products, where the origination of such data involves considerable effort. The Article requires governments to protect such data against unfair commercial use. It also requires them to protect data against disclosure, except where necessary to protect the public. This allows for the possibility that certain information will have to be protected against unfair commercial use even when that information has been disclosed to the public. To Carvalho, such additional protection could be extended to TK in the form of a legal framework for a TK database system. The system would retain the following three features derived from Article 39.3 of TRIPS: the establishment of rights in data; the enforceability of rights in the data against their use by unauthorized third parties; and the non-fixation of a predetermined term of protection. Carvalho suggests that such databases be registered with national patent offices and that to avoid the appropriation of public domain knowledge, enforcement rights be confined to knowledge that complies with a certain definition of novelty. Novelty need not be defined in any absolute sense, but as commercial novelty (as with the TRIPS provisions on layout-designs of integrated circuits and the UPOV Convention). In other words, knowledge disclosed in the past could be treated as ‘novel’ if the innovation based upon it has not yet reached the market.
Global biocollecting society Drahos (2000) proposes the creation of a Global Biocollecting Society (GBS). This is a property rights-based institution that would reduce transactions costs while improving the international enforcement of rights over traditional knowledge associated with biodiversity. It would also generate trust in the market between holders and commercial users of TK. The GBS would be a form of private collective management organization as is common in the area of copyright and related rights. These operate at the national level. One key difference is that the GBS would be an international institution. Another is that its mandate would be to implement the objectives of the CBD, particularly those relating to TK. Membership of the GBS would be open to traditional groups and communities and companies anywhere in the world. The GBS would be a repository of community knowledge registers voluntarily submitted by member groups and communities. These would be confidential except that the identities of the groups or communities submitting registers would be made known. In doing so, it would trigger a dialogue between a community known to have submitted a register and a company interested in
122 Protecting Traditional Knowledge gaining access to information in this register. The result would be an arrangement to access TK in exchange for certain benefits. To improve the chances for successful transactions of benefit to traditional communities, the GBS could provide a range of services in addition to serving as a repository of TK registers. It could, for example, assist in contractual negotiations and maintain a register of independent legal advisors willing to assist traditional communities. It could monitor the commercial use of TK including by checking patent applications. The GBS could also have an impartial and independent dispute settlement function. Its recommendations would not be legally binding, but there would still be incentives to adhere to them. For example, failure to do so could result in expulsion from the GBS, in which case the excluded party, if a company, might face negative publicity that would be well worth avoiding.
Compensatory liability regime The compensatory liability regime (CLR) idea proposed by Reichman (2001) differs from the previous proposals in that it is – as its name indicates – a liability regime rather than a property-based system. It adopts a conception of TK as know-how, or at least it aims to protect certain TK that may be characterized as know-how. Know-how is taken to refer to knowledge that has practical applications but is insufficiently inventive to be patentable. For such knowledge, a property regime is considered likely to afford excessively strong protection in the sense that it will create barriers for followon innovators. Such a regime will also intrude on the public domain. Reverse engineering ought to be permitted, but not improper means of discovering the know-how, such as bribery or industrial espionage. However, know-how holders face the problem of shortening lead time as reverse engineering becomes ever-more sophisticated. So what is to be done? In the interests of striking the right balance between the reasonable interests of creators of subpatentable innovations and follow-on innovators, a liability regime is needed to ensure that for a limited period of time, users should be required to compensate the holders of know-how they wish to acquire. Such a regime would apply to know-how for which lead times are especially short and which do not, therefore, lend themselves to trade secret protection. Compensation would not be paid directly but through a collecting society. The CLR would require knowhow to be registered and in so doing would provide short-term legal protection during which all uses by second comers should be compensated. Royalty rates would be low and could be based on standard form agreements. The CLR would not apply to all TK, but to new knowledge, while a misappropriation regime could apply to old knowledge.
STRATEGIC CONSIDERATIONS At least two important questions arise in the negotiation and implementation of legal solutions that need to be considered carefully. First, should efforts be
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devoted to developing a national sui generis system first in order to gain experience that makes it easier to determine what a workable international solution should look like, or is a multilateral settlement a precondition for the effective protection of the rights of TK-holders in any country? Second, how might concerned countries overcome the limitation with national sui generis systems to protect TK, which is that they will have no extra-territorial effect? While each country will no doubt come up with good reasons to answer these questions differently, there seems to be a consensus among countries supporting sui generis systems of positive protection and groups representing TK-holding people and communities that the problem with having a national system in a world where few such systems exist is that no matter how effective it may be at the domestic level, it would have no extraterritorial effect. Consequently, TK-right holders would not be able to secure similar protection abroad, and exploitative behaviour in other countries would go on as before. In April 2002, the Government of India, in cooperation with UNCTAD, held an International Seminar on Traditional Knowledge in which representatives from Brazil, Cambodia, Chile, China, Colombia, Cuba, Egypt, Kenya, Peru, Philippines, Sri Lanka, Thailand, Venezuela and India participated. At the end, a communiqué was issued which noted that national sui generis systems ‘provide the means for protection and growth of TK within national jurisdictions’; these were inadequate to fully protect and preserve TK. But as the participants went on to explain: ‘the ability of patent offices in a national jurisdiction to prevent bio-piracy as well as to install informed consent mechanisms to ensure reward to TK-holders does not ipso facto lead to similar action on the patent application in other countries. A need was therefore expressed for an international framework for protecting TK.’ The following components of a framework for international recognition of various sui generis systems, customary law and others for protection of TK were suggested: local protection for the rights of TK-holders through national level sui generis regimes including customary laws as well as others and its effective enforcement inter alia through systems such as positive comity of protection systems for TK; protection of traditional knowledge through registers of TK databases in order to avoid misappropriation; a procedure whereby the use of TK from one country is allowed, particularly for seeking IPR protection or commercialization, only after the competent national authority of the country of origin gives a certificate that source of origin is disclosed and prior informed consent, including acceptance of benefit sharing conditions, obtained; and an internationally agreed instrument that recognizes such national level protection. This would not only prevent misappropriation but also ensure that national level benefit sharing mechanisms and laws are respected worldwide. This sounds very positive. However, as was pointed out by a Canadian indigenous peoples’ organization, the Four Directions Council, in a paper submitted in 1996 to the Secretariat of the Convention on Biological Diversity:
124 Protecting Traditional Knowledge Indigenous peoples possess their own locally-specific systems of jurisprudence with respect to the classification of different types of knowledge, proper procedures for acquiring and sharing knowledge, and the rights and responsibilities which attach to possessing knowledge, all of which are embedded uniquely in each culture and its language. For this reason: Any attempt to devise uniform guidelines for the recognition and protection of indigenous peoples’ knowledge runs the risk of collapsing this rich jurisprudential diversity into a single ‘model’ that will not fit the values, conceptions or laws of any indigenous society. It is therefore inappropriate for countries to come up with a one-size-fits-all international sui generis system. Any new international norms will have to be flexible enough to accommodate this jurisprudential diversity. If not, they will fail. Close collaboration with TK-holders and their communities is essential in the design of the sui generis system. This point cannot be emphasized strongly enough. But even this may not be enough. Groups and individuals that have control over their own destinies are far better placed to benefit from legal protection for their knowledge. For example, indigenous groups empowered with rights to control access to their lands and communities have a better chance of preventing misappropriation of their knowledge and of negotiating favourable bioprospecting arrangements. But in all too many cases, indigenous groups and TK-holders suffer from extreme poverty, ill-health, unemployment, lack of access to land and essential resources, and human rights violations. In consequence, cultural diversity is, as mentioned earlier, eroding at an accelerating rate. This suggests that measures to protect TK and the rights of the holders, custodians and communities need to be implemented with some urgency. As the late Darrell Posey so poignantly expressed it: With the extinction of each indigenous group, the world loses millennia of accumulated knowledge about life in and adaptation to tropical ecosystems. This priceless information is forfeited with hardly a blink of the eye: the march of development cannot wait long enough to even find out what it is about to destroy (Posey, 2002, p59). Yet this tragedy is not inevitable. As Posey explained, ‘if technological civilization begins to realize the richness and complexity of indigenous knowledge, then Indians can be viewed as intelligent, valuable people, rather than just exotic footnotes to history’ (Posey, 2002, p59).
Part 4
FORUMS, PROCESSES AND INITIATIVES
Chapter 12 INTERNATIONAL FORUMS AND PROCESSES
The global intellectual property right (IPR) regime, as with international law generally, is in a state of continuous evolution under the influence of institutions, forums and processes at various levels. This chapter describes the work of the most relevant intergovernmental forums with an assessment of how they are likely to influence the global IPR regime in the coming years.
THE WORLD TRADE ORGANIZATION Two World Trade Organization (WTO) bodies are of particular relevance to this book: the Council for TRIPS, which oversees the functions of the TRIPS Agreement, and the Committee on Trade and Environment (CTE). Unlike meetings of the Conference of the Parties to the Convention on Biological Diversity (CBD), neither is open to the public but only to official delegates nominated by governments. These are normally Geneva-based diplomats.
The Council for TRIPS The Council for TRIPS has four main responsibilities: monitoring the operation of TRIPS, and in particular members’ compliance; affording members the opportunity to consult on matters relating to trade-related IPRs; assisting members in the contest of dispute settlement procedures; and carrying out other duties assigned to it by the members (Article 68). According to the builtin agenda of TRIPS, the Council was to review Article 27.3(b) in 1999, and the implementation of the whole Agreement in 2000, and at two-year intervals thereafter. Since 1998, numerous proposals have been submitted to the Council of TRIPS and also to the WTO General Council – the second most important WTO institution after the Ministerial Conference – concerning the review of Article 27.3(b). However, at the time of writing, this review remains to be concluded. Initially, the US sought to remove most of the exceptions to patentability permitted under Article 27.3(b). A US government communication to the
128 Forums, Processes and Initiatives WTO General Council, dated 19 November 1998, noted in reference to the 1999 review that the TRIPS Council is ‘to consider whether it is desirable to modify the TRIPS Agreement by eliminating the exclusion from patentability of plants and animals and incorporating key provisions of the UPOV agreement regarding plant variety protection’ (WTO General Council, 1998). That this ignores the options both of leaving Article 27.3(b) unaltered and of developing sui generis systems that do not incorporate key provisions of the UPOV convention appeared to be a deliberate attempt to pre-empt the agenda of the review. The US and the European Community (EC) have also been keen to ensure that the morality and ordre public exclusions may only be applied in individual cases and construed narrowly, and that countries that exclude plant varieties from patentability join UPOV. One successful solution has been bilateral free trade agreements in which developing country parties agree to join UPOV and adopt more biotech-friendly patent systems in exchange for enhanced market access. However, because of stronger developing-country resistance at the TRIPS Council to such attempts, the US has limited its ambitions and joined the EC in seeking to maintain the status quo and prevent developing countries from revising Article 27.3(b) in ways that could restrict the patentability of biotechnological inventions or place additional obligations on patent applicants, for example requiring mandatory disclosure of origin. In August 1999 developing countries submitted two documents to the General Council dealing with intellectual property (IP), biogenetic resources and traditional knowledge (TK). One of these, from the Permanent Mission of Venezuela, proposed that the next review of TRIPS inter alia should ‘establish on a mandatory basis within the TRIPS Agreement a system for the protection of intellectual property, with an ethical and economic content, applicable to the traditional knowledge of local and indigenous communities, together with recognition of the need to define the rights of collective holders’ (WTO-GC, 1999a). And the African Group of countries proposed to the WTO General Council that, in the sentence on plant variety protection (PVP) in Article 27.3(b): a footnote should be inserted stating that any sui generis law for plant variety protection can provide for [inter alia]: (i) the protection of the innovations of indigenous farming communities in developing countries, consistent with the Convention on Biological Diversity and the International Undertaking on Plant Genetic Resources (WTO-GC, 1999b). This latter communication, which attracted considerable worldwide support from non-governmental organizations (NGOs), also warned that ‘by mandating or enabling the patenting of seeds, plants and genetic and biological materials, Article 27.3(b) is likely to lead to appropriation of the knowledge and resources of indigenous and local communities’. In October of 1999, twelve developing countries from Asia, Africa and Latin America submitted two joint papers to the General Council detailing the implementation issues to which they were seeking solutions (WTO-GC, 1999c,
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1999d). The two papers put forward several TRIPS-related proposals. One of these argued that TRIPS is incompatible with the CBD and sought a clear understanding that patents inconsistent with Article 15 of the CBD, which vests the authority to determine access to genetic resources in national governments, should not be granted. Several other proposals were directed to Article 27.3(b) and the review of its substantive provisions. One proposal was that the paragraph should be amended in light of the provisions of the CBD, taking fully into account the conservation and sustainable use of biological diversity, and the protection of the rights and knowledge of indigenous and local communities. In the same month, a detailed proposal for a legal framework on TK was submitted to the General Council by the governments of Bolivia, Colombia, Ecuador, Nicaragua and Peru (WTO-GC, 1999e). Specifically, the document proposed that the WTO establish a mandate in a future trade round with three purposes: 1 2 3
To carry out studies, in collaboration with other relevant international organizations, in order to make recommendations on the most appropriate means of recognizing and protecting TK as the subject matter of IPRs. On the basis of the above-mentioned recommendations, initiate negotiations with a view to establishing a multilateral legal framework that will grant effective protection to the expressions and manifestations of TK. To complete the legal framework envisaged in paragraph (2) above in time for it to be included as part of the results of this round of trade negotiations (WTO-GC, 1999e).
At the fourth meeting of the WTO Ministerial Conference, which took place in Doha in November 2001, a Ministerial Declaration was adopted according to which the WTO member states instructed: the Council for TRIPS, in pursuing its work programme including under the review of Article 27.3(b), the review of the implementation of the TRIPS Agreement under Article 71.1 and the work foreseen pursuant to paragraph 12 of this Declaration, to examine, inter alia, the relationship between the TRIPS Agreement and the Convention on Biological Diversity, the protection of traditional knowledge and folklore (Paragraph 19). As a contribution to this examination, Brazil, China, Cuba, Dominican Republic, Ecuador, India, Pakistan, Thailand, Venezuela, Zambia and Zimbabwe jointly submitted a paper to the Council for TRIPS in June 2002 (WTO-TRIPS, 2002). The paper, noting the relevant provisions of the Bonn Guidelines (see below), proposed that TRIPS be amended to provide that WTO member states must require: that an applicant for a patent relating to biological materials or to traditional knowledge shall provide, as a condition to acquiring patent rights: (i) disclosure of the source and country of origin of the biological resource and of the traditional
130 Forums, Processes and Initiatives knowledge used in the invention; (ii) evidence of prior informed consent through approval of authorities under the relevant national regimes; and (iii) evidence of fair and equitable benefit sharing under the national regime of the country of origin. It is very hard to imagine TRIPS being revised to ban the patenting of lifeforms. As for TK, it seems highly unlikely that a new legal framework will be inserted into TRIPS anytime soon. At most, minimalist measures to safeguard TK from misappropriation could conceivably be agreed upon. A greater danger is that trade negotiators will sacrifice the interests of TK-holders once concessions in other areas of intellectual property or other trade-related issues are secured in return. In fact, for developing countries, TK serves a strategic purpose at the WTO that is unlikely to serve the interests of traditional peoples and communities. While some trade negotiators and ministries may see TK as a significant moral or economic issue, it is difficult to imagine many developing countries pursuing this issue with any great determination. And for governments genuinely interested in TK, whether out of a sense of social justice or because they believe TK can benefit national economies, solutions need to be found at the national level. These solutions have more to do with basic human rights than with IPRs. Indeed, the significance of the TK issue should be seen as transcending its role in TRIPS negotiations and should not be reduced to a problem merely for IPR experts or trade negotiators to solve. It is not that elements of TK cannot be protected through patents, copyrights, and trade secrets, but that the exploitation of traditional peoples and communities, including holders of TK, is fundamentally due to a widespread failure to respect their basic rights, and not to the inadequacies of IPRs to protect TK.
The Committee on Trade and Environment The 1994 Marrakech Ministerial Decision on Trade and Environment, which set out the terms of reference for the Committee on Trade and Environment (CTE), required the CTE, which was formally established by the General Council the following year, to consider the relevant provisions of TRIPS ‘as an integral part of its work’. Traditional and indigenous knowledge has been discussed during several CTE meetings, and a few governments have argued in favour of the need to reform the patent system and to protect indigenous knowledge, such as through trade secrets and sui generis systems consistent with CBD Article 8(j). For example, the Nigerian delegation opposed the patenting of life-forms and argued that TRIPS must be construed to ‘accord recognition to traditional interest and right holders’ (WTO-CTE, 1996b). An Indian representative argued that: the worst casualty, in an IPR regime for plant varieties, was the knowledge, innovations and practices of indigenous and local communities embodying traditional lifestyles relevant for the conservation and sustainable use of biodiversity, highlighted in Article 8(j) of the Biodiversity Convention (WTO-CTE, 1996b).
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In November 1996, the Committee adopted its Report to the Singapore Ministerial Conference (WTO-CTE, 1996c). The Report concluded that further work was needed to better appreciate the relationship of the relevant provisions of TRIPS to environmental protection and sustainable development and whether and how these provisions relate to: The creation of incentives for the conservation of biological diversity, the sustainable use of its components, and the fair and equitable sharing of the benefits arising from the utilization of genetic resources including the protection of knowledge, innovations and practices of indigenous and local communities embodying traditional lifestyles relevant to the conservation and sustainable use of biodiversity (WTOCTE, 1996c). Paragraph 31 of the 2001 Ministerial Declaration stated, in part, that ‘with a view to enhancing the mutual supportiveness of trade and environment, we agree to negotiations, without prejudicing their outcome, on: (i) the relationship between existing WTO rules and specific trade obligations set out in multilateral environmental agreements (MEAs)’. This statement should be considered in the light of two articles of the CBD. First, Article 16.5, which recognizes that ‘patents and other intellectual property rights may have an influence on this Convention’ and requires states to cooperate ‘subject to national legislation and international law in order to ensure that such rights are supportive of and do not run counter to its [ie the CBD’s] objectives’. Second, Article 22.1, according to which: The provisions of this Convention shall not affect the rights and obligations of any Contracting Party deriving from any existing international agreement, except where the exercise of those rights and obligations would cause a serious damage or threat to biological diversity. The issue of priority in the case of two international agreements with provisions and aims that may be in conflict arises here. International law does not provide a definitive answer in this particular case (see Cameron and Makuch, 1995), and the CTE deliberations evince a strong disagreement among members about the relationship of MEAs like the CBD to WTO rules. Wherever the truth lies, the most substantial exploration of the TRIPS–CBD relationship has taken place in the TRIPS Council and not the CTE. Indeed, the CTE is sometimes dismissed as little more than a talking shop with very little influence.
THE WORLD INTELLECTUAL PROPERTY ORGANIZATION Most international conventions pertaining to intellectual property rights are administered by the World Intellectual Property Organization (WIPO), a
132 Forums, Processes and Initiatives United Nations specialized agency. Although its origins can be traced to the Paris and Berne Conventions adopted in 1883 and 1886, respectively, WIPO was formally established in 1967. The WIPO’s primary objectives are to administer international treaties on intellectual property laws; to provide assistance to member states in promulgating intellectual property laws; and to seek harmonization of national laws, aiming to promote the protection of IP throughout the world. The IPR treaties administered by WIPO include the following: • • • • • • •
Paris Convention for the Protection of Industrial Property (1883, revised most recently in 1967 at Stockholm) Berne Convention for the Protection of Literary and Artistic Works (1886, revised most recently in 1971 at Paris and amended in 1979) The WIPO Performances and Phonograms Treaty (1996) Madrid Agreement Concerning the International Registration of Trademarks (1891, revised most recently in 1967 at Stockholm and amended in 1979) Lisbon Agreement for the Protection of Appellations of Origin and their International Registration (1958, revised in 1967 at Stockholm and amended in 1979) Patent Cooperation Treaty (1970, amended in 1979 and modified in 1984) Budapest Treaty on the International Recognition of the Deposit of Microorganisms for the Purpose of Patent Procedure (1977, amended in 1980).
Unlike the WTO and its GATT predecessor, WIPO does not have a dispute settlement mechanism to deal with alleged cases of non-compliance with treaties. This is one of the main reasons why the developed countries worked hard to ensure that one of the outcomes of the Uruguay Round was an IPR agreement promoting minimum standards throughout the world while allowing members to challenge the perceived failures of other members to implement these standards. This does not mean that WIPO is becoming marginal to the global IPR regime. Indeed, WIPO is by far the most important international institution dedicated to IPRs, and is likely to increase its influence as it builds closer links with other institutions such as the WTO and the CBD Conference of the Parties (COP) and Secretariat . Moreover, WIPO is collaborating with the WTO to help developing countries to meet their TRIPS obligations by 2000 through the provision of technical assistance, for example, ‘in preparing legislation, training, institution-building, and modernizing intellectual property systems and enforcement’.1 The involvement of WIPO in TK goes back more than 20 years. In the 1970s and 1980s, WIPO, with UNESCO, held a series of meetings on folklore that culminated in the 1982 adoption of the Model Provisions for National Laws on the Protection of Expressions of Folklore Against Illicit Exploitation and Other Prejudicial Actions. In 1984, WIPO and UNESCO convened a meeting to explore the possibility of developing an international treaty on
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folklore based on the Model Provisions. However, participants at the meeting were unable to reach agreement and the proposal for a treaty was withdrawn. Consequently, WIPO dropped the issue of folklore from its programmes for several years. The next collaboration between WIPO and UNESCO on folklore was the 1997 World Forum on Folklore in Phuket, Thailand. The idea of having such an event was proposed in February 1996 by several of the developing country delegations attending the joint sessions of the WIPO Committee of Experts on a Possible Protocol to the Berne Convention, and the WIPO Committee of Experts on a Possible Instrument for the Protection of the Rights of Performers and Producers of Phonograms.2 The Committees subsequently recommended to the WIPO Governing Bodies that an international forum on folklore be arranged. The majority of participants at the World Forum agreed that copyright law was inadequate to protect folklore and therefore urged WIPO and UNESCO ‘to pursue their efforts to ensure an effective and appropriate international regime for the protection of folklore.’3 Most of the participants suggested the following actions: •
• •
A Committee of Experts should be set up in cooperation with UNESCO as soon as possible, consisting of experts in both the conservation and protection of folklore and representing a fair balance of global geographical distribution. Regional consultative fora should take place. The Committee of Experts should complete the drafting of a new international agreement on the sui generis protection of folklore.4
In early 1998, shortly after Kamil Idris of Sudan had become the new DirectorGeneral, WIPO established a unit called the Global Intellectual Property Issues Division (GIPID). The purpose of this new Division was to identify and respond to the new challenges for the intellectual property system of globalization and rapid technological change. As part of this mandate, the Division sought to identify potential new beneficiaries of IPRs, including traditional peoples and communities. The Division researches and explores various issues including protection of TK, innovations and creativity, and the protection of folklore.5 During 1998 and 1999, WIPO embarked on nine fact-finding missions in various parts of the world on TK, innovations and culture to investigate the needs and expectations of TK-holders, bearing in mind the possible use of existing IPRs to protect their knowledge, innovations and culture (see WIPO, 2001). In addition, WIPO held four regional consultations on the protection of expressions of folklore, again jointly with UNESCO. Since 2001, GIPID, which has been renamed the Traditional Knowledge Division, has sought to go beyond identifying and investigating the issues involved and to find out the views of TK-holders by addressing basic conceptual problems and testing practical solutions. The emphasis of its work
134 Forums, Processes and Initiatives has shifted towards such activities as pilot projects on the use of existing IPRs to protect TK, exploration of customary law and its relationship with the formal intellectual property system, and training and awareness-raising programmes for the benefit of TK-holders.6 Is this work likely to lead to a new treaty on TK? This does not seem possible. According to one commentator: GIPID’s mandate is limited. American support for the new mandate was secured in return for the concession that GIPID was not ‘on a norm setting track’; that is to say, that its work is not intended to feed into a process which would end with the creation of a treaty or recommendations (Halewood, 1999, pp986–987). Despite this sceptical assessment, there is a great deal of interest in this work, and an intergovernmental forum now exists under WIPO’s auspices to discuss the interrelated issues of genetic resources, TK and folklore. The establishment of this forum, the Intergovernmental Committee on Intellectual Property and Genetic Resources, Traditional Knowledge and Folklore, was an unintended outcome of a proposal submitted to the third session of WIPO’s Standing Committee on the Law of Patents (SCP), which took place in September 1999. The session was to be devoted mainly to discussing a draft Patent Law Treaty (PLT). The PLT was intended to harmonize certain patent procedures while steering clear of matters relating to substantive patent law. The Colombian delegation at the session submitted a brief document entitled ‘Protection of biological and genetic resources’ that turned out to be quite controversial (WIPO-SCP, 1999). The delegation proposed that the PLT include an article based on the two proposals that the document comprised. The first was that ‘all industrial property protection shall guarantee the protection of the country’s biological and genetic heritage. Consequently, the grant of patents or registrations that relate to elements of that heritage shall be subject to their having been acquired legally’. The second was that: Every document shall specify the registration number of the contract affording access to genetic resources and a copy thereof where the goods or services for which protection is sought have been manufactured or developed from genetic resources, or products thereof, of which one of the member countries is the country of origin. (WIPOSCP, 1999) This idea of linking patent filing with access and benefit sharing regulations gained the support of Bolivia, Paraguay, China, Namibia, Cameroon, Mexico, South Africa, Chile, Cuba, India, Kenya, Costa Rica and Barbados. Predictably, it did not go down well with some of the other delegations, including the US, the EC, Japan and Korea, all of which argued that the proposed article related to substantive patent law and therefore had no place in the PLT. As things turned out, Colombia’s proposal did not fail completely, as the concerns behind it were given other opportunities for expression within WIPO.
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As a compromise, the SCP invited WIPO’s International Bureau to do two things. The first was to include the issue of protection of biological and genetic resources on the agenda of that November’s meeting of the Working Group on Biotechnological Inventions. The second was to arrange another meeting specifically on that issue. This Meeting on Intellectual Property and Genetic Resources took place in April 2000 and reached a consensus that: ‘WIPO should facilitate the continuation of consultations among Member States in coordination with the other concerned international organizations, through the conduct of appropriate legal and technical studies, and through the setting up of an appropriate forum within WIPO for future work’ (WIPO, 2000). Two months later the Diplomatic Conference for the Adoption of the Patent Law Treaty took place. While the main purpose was of course to agree upon and formally adopt the PLT, there were also consultations on genetic resources. Based upon these consultations, WIPO’s Director-General Kamil Idris read out an agreed statement announcing that ‘Member State discussions concerning genetic resources will continue at WIPO. The format of such discussions will be left to the Director General’s discretion, in consultation with WIPO Member States’ (WIPO, 2000). After the Conference, Idris continued to consult with member states on how such discussions could continue. For the 25th Session of WIPO’s General Assembly, the Secretariat prepared a document that invited member states to consider the establishment of an Intergovernmental Committee on Intellectual Property and Genetic Resources, Traditional Knowledge and Folklore (IGC). The WIPO Secretariat suggested that the IGC constitute a forum for members to discuss three themes that it had identified during the consultations. These were ‘intellectual property issues that arise in the context of (i) access to genetic resources and benefit sharing; (ii) protection of traditional knowledge, whether or not associated with those resources; and (iii) the protection of expressions of folklore’ (WIPO, 2000). This suggestion was enthusiastically supported by a large number of developing countries and approved without formal opposition. The first three sessions of the IGC convened in April and December 2001, and in June of the following year. At the third IGC, substantive discussion relating to how patent law might more effectively promote benefit sharing and prevent the misappropriation of TK focused on two possible approaches. The first was to require patent applicants to disclose the origin of genetic resources and/or associated TK in related patent applications. Some delegations believe such applicants should also provide documentary evidence of prior informed consent (PIC) and compliance with the access and benefit sharing (ABS) regulations of provider countries. The US delegation stated that such requirements would conflict with TRIPS by creating another substantive condition on patentability beyond those already provided by the latter. Countries like India and Brazil have repeatedly stated that such a measure is necessary to make patents supportive of the CBD. They claim that mandatory disclosure of origin would do this by preventing private monopoly rights from extending to illegally acquired genetic resources (see WIPO, 2002).
136 Forums, Processes and Initiatives The second approach was to improve the availability of public domain TK to patent examiners to prevent cases where patents whose claims extend to TK are improperly awarded. Two possible ways to do this are to provide an inventory of publications that regularly document TK, and to compile databases of public domain TK. India is a very keen proponent of such databases and is already setting up its own Traditional Knowledge Digital Library. The specifics of these proposals and their feasibility were considered in Chapter 11 and will not be discussed further.
THE CONFERENCE OF THE PARTIES TO THE CONVENTION ON BIOLOGICAL DIVERSITY To review implementation of the CBD, the Conference of the Parties (COP) (composed of all Contracting Parties) meets periodically (usually biannually). It is noteworthy that close links exist between many of the national delegations and well-organized networks of highly articulate and politically astute activists representing international civil society organizations that attend virtually all inter-governmental meetings relating to the CBD. The openness of the CBD forums, not just the COP but the other bodies set up to assist the COP in its work,7 has made the building of such links easier. Sometimes activists are invited onto the official delegations. At the Sixth Meeting of the Conference of the Parties (COP 6), which took place in The Hague in May 2002, the Bonn Guidelines on Access to Genetic Resources and Fair and Equitable Sharing of the Benefits Arising out of their Utilization were officially adopted (in CBD Secretariat, 2002). The Guidelines, which are intended to be used when developing and drafting legislative, administrative or policy measures on ABS and contracts, have a number of provisions relating to IPRs. It is suggested that parties with genetic resource users under their jurisdiction consider adopting ‘measures to encourage the disclosure of the country of origin of the genetic resources and of the origin of traditional knowledge, innovations and practices of indigenous and local communities in applications for intellectual property rights’ (Paragraph 16(d)(ii)). As a way to implement the CBD provision that benefit sharing be upon mutually agreed terms, two elements to be considered as guiding parameters in contracts and as basic requirements for mutually agreed terms are that: ‘provision for the use of intellectual property rights include joint research, obligation to implement rights on inventions obtained and to provide licences by common consent’, and ‘the possibility of joint ownership of intellectual property rights according to the degree of contribution’. While the Bonn Guidelines are voluntary and are likely to have little direct impact on international law, they may well influence national policy-making. COP Decision VI/24, to which the Bonn Guidelines were annexed, also called for further information gathering and analysis regarding several matters, including:
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• • • • •
impact of intellectual property regimes on access to and use of genetic resources and scientific research; role of customary laws and practices in relation to the protection of genetic resources and TK, innovations and practices, and their relationship with intellectual property rights; efficacy of country of origin and PIC disclosures in assisting the examination of IPRs application and the re-examination of IPRs granted; feasibility of an internationally recognized certification of origin system as evidence of PIC and mutually agreed terms; role of oral evidence of prior art in the examination, granting and maintenance of IPRs.
Chapter 13 GOVERNMENT AND REGIONAL INITIATIVES
Genetic resource access and benefit sharing (ABS) laws are being used by some countries to place conditions on the exercise of intellectual property rights (IPRs) as a way of harmonizing them with objectives related to the Convention on Biological Diversity (CBD). The Philippines pioneered the enactment of such regulations, although it consciously avoided any reference to intellectual property. The Andean Community’s Common System on Access to Genetic Resources reflects the first attempt to regulate access at regional level. Perhaps the most ambitious and detailed regulations, however, are those of Costa Rica, which aims to implement the CBD in its entirety rather than just its provisions relating to ABS. The Organization of African Unity member states are considering a draft model law on community rights and access to biological resources. These initiatives are presented and analysed in this chapter.
PHILIPPINES EXECUTIVE ORDER 247 AND ITS IMPLEMENTING RULES AND REGULATIONS The Philippine ABS experience is significant initially because it was the first country to introduce bioprospecting regulations, and second because it set a trend for such kinds of national system to be developed through processes of consultation with civil society organizations and indigenous and local communities. Executive Order No. 247 became law in 1995. An Executive Order is different from an Act of the Congress in that it comes from the executive branch of government. This might suggest that it was developed with little civil society participation. On the contrary, it was the result of a consultative process involving a wide range of stakeholders. The original suggestion for such a law came from the Philippine scientific community, in fact a network of natural product chemists. And it was these university scientists who produced the first draft. They then invited a lawyer, Antonio La Viña, working for a non-governmental organization (NGO) at the time, to revise it. This initial drafting group was then joined by the National
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Academy of Science and Technology, an institution affiliated to a government department. The first consultations were held with academics and university scientists, subsequently with government officials and scientists, and were later opened up to include other government departments, NGOs, organizations representing the indigenous communities, and the (mostly Philippine) private sector. Shortly after the Executive Order was signed by President Ramos in May 1995, work began on the Implementing Rules and Regulations (IRRs). This was the task of a new regulatory body established by EO 247 to enforce and implement its provisions: the Inter-Agency Committee on Biological and Genetic Resources (IACBGR). When La Viña was appointed Department of Environment and Natural Resources (DENR) Under-secretary in January 1996 he was given overall responsibility for drafting the IRRs. Drafts were circulated for comments to government departments, universities, the national private sector, and also to some NGOs and POs. The final version was signed in June that year by the DENR Secretary. The purpose of EO 247 is to regulate the prospecting of biological and genetic resources so that these resources are protected and conserved, are developed and put to the sustainable use and benefit of the national interest. Its scope covers the prospecting of all biological and genetic resources in the public domain, including natural growths in private lands, intended to be utilized by both foreign and local individuals, entities and organizations, whether government or private.
Core elements Prior informed consent According to the IRRs, prior informed consent (PIC) refers to the consent obtained by the applicant from: the local community; indigenous people; protected area management board; or the private land owner concerned, after disclosing fully the intent and scope of the bioprospecting activity, in a language and process understandable to the community, and before any bioprospecting activity is undertaken. Unlike Decision 391 and similar to the Costa Rican law, PIC is not required at the level of the State. Rather, applications for academic or commercial research relating to bioprospecting must be accompanied by a PIC certificate issued by one (or more) of the above types of entity. Nonetheless, the amount of detail to be provided to the IACBGR before access can be granted amounts to a de facto PIC requirement. Mutually agreed terms Permission for bioprospecting depends on a research agreement between the bioprospector and the government. For an agreement to be granted, a research proposal must be submitted to the government, with a copy submitted to any community that may be affected. There are two kinds of research agreement: the Academic Research Agreement (ARA) and the Commercial Research
140 Forums, Processes and Initiatives Agreement (CRA). Certain minimum terms apply to all agreements, while a number apply specifically to ARAs and CRAs. The applicants for a research agreement of either kind must agree to a list of 17 minimum terms and conditions. These deal with such matters as: • • • • • • • •
• •
the deposit of voucher specimens and samples; access to specimens deposited in international genebanks for Filipinos and Philippine government entities; controls on the export and transportation of biological and genetic material; periodic reports on the collections made; the availability of commercial products derived from Philippine resources to the national government and local communities concerned; submission of a list of species collected, utilized or currently being developed; equitable sharing of immediate, medium- and long-term benefits resulting from the bioprospecting activities among the government, communities concerned and the entity that is party to the research agreement; the requirement that all bioprospecting research, including the technological development of a product derived from the collected biological and/or genetic resources by any foreign individuals or entities be conducted in collaboration or cooperation with Philippine scientists from domestic institutions; the requirement that technologies developed from research on Philippine endemic species be made available royalty-free for commercial and local uses to the national government; the requirement that a separate agreement be made for the transfer of royalties, benefits and technologies.
With respect to ARAs, an important condition is that collected data and materials are for the exclusive use of the parties and are not transferable to commercial entities unless the agreement is reclassified as a CRA. As for CRAs, one of the most important conditions is that if a technology or a commercial product is developed and marketed out of the biological and/or genetic resources/specimens collected in the Philippines, an equity or remittance, in the amount to be mutually agreed upon by the parties concerned, shall be equitably shared with the Philippine government, or with the protected areas fund if the materials or resources come from the protected areas, or with the concerned indigenous people or local community who gave the PIC and with the individual person who modified such material or resource that came from private property. Roles, responsibilities and participation of stakeholders Due to the comprehensive nature of the IRRs, the Philippine system is relatively explicit about the roles, responsibilities and participation of the various stakeholder groups. Thus, parties to ARAs envisaged by the IRRs include:
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• • •
Philippine universities and academic institutions; domestic governmental entities; and intergovernmental entities.
Parties to CRAs are: • • •
private persons; corporations; and foreign international entities.
In addition, the IACBGR consists of a broad cross-section of such groups and others. According to Section 6 of EO 247, the IACBGR is constituted by under-secretaries of two government departments: the DENR and the Department of Science and Technology (DOST); and representatives of: the Departments of Agriculture, Health and Foreign Affairs, the Philippine academic science community, the National Museum, an NGO active in biodiversity protection, and a People’s Organization (PO) with membership consisting of indigenous cultural communities and/or their organizations to be selected by the PO community. In situ and ex situ conservation and sustainable use The IRRs make few references to conservation or the sustainable use of biodiversity. With respect to research agreements, it is stipulated that in the case of benefit sharing arrangements, beneficiaries must include the local communities, indigenous peoples or protected areas concerned and be allocated for conservation measures. In the case of CRAs, benefits from commercialization should go to the Integrated Protected Areas Fund if the biological or genetic material came from a protected area. Mechanisms for benefit sharing, including technology transfer and joint research and development According to the IRRs, benefit sharing refers to the sharing of the results of bioprospecting activity and the benefits arising from the utilization or commercialization of the biological or genetic resources fairly and equitably with the indigenous cultural community/local community/protected area/private land owner concerned and the national government by the Principal/Collector. Among the results and benefits that may be shared are payment for access to specimens, royalties, data, technology, capacity building, training and joint research. Means to ensure the maintenance and protection of traditional knowledge, innovations and practices According to the IRRs, Indigenous Cultural Communities or Indigenous Peoples refers to a homogenous society identified by self-ascription and ascription by others, who have continuously lived as a community on
142 Forums, Processes and Initiatives communally bounded and defined territory, sharing common bonds of language, customs, traditions and other distinctive cultural traits, and who, through resistance to the political, social and cultural inroads of colonization, became historically differentiated from the majority of Filipinos. The preamble of EO 247 affirms that it is in the interests of the State’s conservation efforts to identify and recognize the rights of indigenous cultural communities and other Philippine communities to their traditional knowledge and practices when this information is directly and indirectly put to commercial use. Similarly, the IRRs refer to the CBD and its recognition of the close and traditional dependence of many indigenous and local communities embodying traditional lifestyles on biological resources, and the desirability of sharing equitably any benefits arising from the use of TK, innovations and practices relevant to the conservation of biological diversity and the sustainable use of its components. However, while EO 247 and the IRRs regulate access to biological and genetic resources on the ancestral lands and domains of indigenous cultural communities and indigenous peoples, they do not refer directly to the transfer to bioprospectors of associated TK, innovations and practices. So while the interests of these peoples and communities in the resources existing on their lands and domains are supported through the PIC procedure and the requirement that benefits from commercialization should be shared with them, procedures for strengthening their rights over their knowledge, innovations and practices are apparently not provided for. Intellectual property rights The EO 247 hardly deals with IPRs, except that one of the duties and functions of the IACBGR is to study and recommend to the President and the Congress appropriate laws on the utilization of biological and genetic resources, including new laws on IPRs. Tangible property The preamble of EO 247 asserts that wildlife, flora and fauna, among others, are owned by the State and the disposition, development and utilization thereof are under its full control and supervision. However, the State’s sovereignty rights are not absolute, in that prospecting is only permitted within the lands of private owners and the ancestral lands and domains of indigenous cultural communities with the PIC of such land owners and communities, obtained in accordance with communities’ customary laws.
Progress in implementation In terms of the implementation of EO 247 and the IRRs, given the pioneering nature of both the process and the regulations themselves, one should not be too surprised that difficulties have arisen. There is, for example, concern that the rules and regulations are too complex and bureaucratic. This may well be true because, since 1995, only two research permits have been issued.
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ANDEAN COMMUNITY COMMON REGIME ON ACCESS TO GENETIC RESOURCES The Andean Community1 Decision 391, establishing a ‘Common System on Access to Genetic Resources’ was the culmination of a two-year process that began in 1994 when the International Union for the Conservation of Nature and Natural Resources World Conservation Union was invited to provide a technical report outlining the basic elements for a draft ABS system that could be drawn upon by government drafters. The first draft of the report was prepared soon afterwards with an IUCN member NGO, the Peruvian Society of Environmental Law (SPDA). From the start it was intended that indigenous peoples and civil society organizations would participate in the process of developing the system through their attendance at workshops and expert meetings, and by requesting their comments on drafts. But at a workshop in August 1994, which was attended by a large number of indigenous peoples’ organizations and other NGOs, a small number of these groups apparently mistook the second draft report – intended for discussion only – for an actual draft law, and sought to have it rescinded. As a consequence of the controversy surrounding this incident, civil society involvement became more limited. At the same time, there were differences between governments concerning some basic provisions of the system, leading to delays. But a text was finally agreed and adopted by the Andean Community member countries in 1996 as Decision 391. Article 2 sets out the objectives of Decision 391, which are to regulate access to genetic resources and their derivatives in order to: • • • • •
create the conditions for fair and equitable sharing of the benefits accruing from such access; establish a basis for the recognition and appreciation of genetic resources, their derivatives and related intangible components, particularly where indigenous, Afro-American and local communities are involved; encourage the conservation of biological diversity and sustainable use of biological resources containing genetic resources; promote the consolidation and development of scientific, technological and technical capacities at local, national and subregional level; and strengthen the negotiating capacity of the member countries.
Article 3 establishes the scope of the Decision, which applies to: • • •
genetic resources for which the member countries are countries of origin; their derivatives and intangible components; and the genetic resources of migratory species found for natural reasons in the territory of the member countries.
In conformity with the CBD, the Decision proclaims that member countries have sovereign rights over the use and exploitation of their genetic resources
144 Forums, Processes and Initiatives and the right to determine conditions of access. However, the Andean Community has gone further than the CBD by extending sovereign rights to the derivatives of these resources. ‘Derivative’ is defined in Article 1 as a molecule or combination or mixture of natural molecules, including raw extracts of living or dead organisms of biological origin, derived from the metabolism of living organisms. A derivative should thus be differentiated from a ‘synthesized product’, which is a substance obtained by means of an artificial process, using genetic information or other biological molecules. This includes semi-processed extracts and substances obtained through treatment of a derivative using an artificial process. An example of a derivative would presumably be a herbal formulation, while a synthesized product would be a pharmaceutical compound modelled on a natural compound. By including derivatives within its purview, the Decision goes beyond the CBD, which regulates access only to genetic resources. Such derivatives may not necessarily contain functional units of heredity. An ‘intangible component’ refers to any knowledge, innovation or individual or collective practice of actual or potential value associated with the genetic resource, its derivatives or the biological resource containing them, whether or not it is protected by intellectual property systems. As will be explained below these terms are extremely significant.
Core elements Prior informed consent Although the Decision makes no explicit reference to PIC, applicants are required to afford competent national authorities with all information concerning the genetic resource and its derivatives with which they are familiar or are in a position to know at the time of presenting the application. This information shall include the actual and potential uses of the resource, its derivatives or intangible components, its sustainability and risks which should arise from accessing it. There is no requirement to provide such information to any other institution or stakeholder group. Mutually agreed terms All access procedures must include an application (including a project proposal) and a contract. Parties to such contracts are the applicant and the State represented by the competent national authority. It is by means of contracts that terms of access are mutually agreed. Such contracts must include various conditions including the following: • •
participation by nationals of the subregion in research activities into genetic resources, their derivatives and associated intangible components; support for research contributing to the conservation and sustainable use of biological diversity being carried out under the jurisdiction of the member country which is the country of origin of the genetic resource, or in any other country of the subregion;
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• • • • •
strengthening of mechanisms for the transfer of knowledge and technologies, including biotechnologies, which are culturally, socially and environmentally safe and healthy; strengthening and development of national or subregional institutional capacities connected with genetic resources and their derivatives; strengthening and development of the capacities of indigenous, AfroAmerican and local communities with regard to the intangible components associated with genetic resources and their derivatives; obligatory deposit, in institutions designated by the Competent National Authority, of duplicates of all material collected; obligation to inform the Competent National Authority of the results of research carried out.
Because only the State has the authority to grant access, other stakeholders are excluded from participation in these contracts. Nonetheless, all access contracts are required to take into consideration the rights and interests of suppliers of genetic resources and their derivatives, and of biological resources and their intangible components. And if access is sought to genetic resources or their derivatives with an intangible component, an annex must be included in the contract providing fair and equitable sharing of the benefits arising from the said component. The annex will have to be signed by the supplier of the intangible component. It may also be signed by the competent national authority. There is no clear indication that the supplier of an intangible component must be a representative of the indigenous, Afro-American or local community that is its source. Other types of contract are also possible, though, such as: framework access contracts between the authority and universities, research centres or recognized researchers; access contracts with ex situ conservation centres; and access contracts with third parties which are likely to be ex situ conservation centres outside the Andean Community region concerning genetic resources whose origins are the member country. The Decision also provides for accessory contracts for the purposes of developing activities connected with access to a genetic resource or its derivatives. Parties to such contracts are applicants and, for example, owners, holders or administrators of the property in which the bioprospecting is to be carried out, and ex situ conservation centres. These contracts are subordinate to the access contracts described earlier. Roles, responsibilities and participation of stakeholders Apart from the state as represented by the competent national authority, the roles, responsibilities and participation of the various other stakeholders are not described in any great detail except as parties to the contracts as presented earlier. But the following stakeholders are referred to: •
applicants for access;
146 Forums, Processes and Initiatives • • • • • • • • • • • •
the member states of the Andean Community, represented by the Competent National Authority; suppliers of genetic resources and their derivatives, and of biological resources and their intangible components; suppliers of any knowledge, innovation or individual or collective practice of actual or potential value associated with the genetic resource, its derivatives or the biological resource containing them; owners, holders or administrators of the property on which biological resources containing genetic resources are found; ex situ conservation centres; owners, holders or administrators of biological resources containing genetic resources; national support institutions; universities; research centres; recognized researchers; other bodies carrying out activities involving access to genetic resources; ‘third party’ suppliers.
In situ and ex situ conservation and sustainable use One of the objectives of the Decision is to encourage the conservation of biological diversity and sustainable use of biological resources containing genetic resources. How is such an objective to be realized through the regulation of access? In Article 9, the States undertake to safeguard and facilitate, by means of the necessary contracts, access to technologies using genetic resources and their derivatives that are appropriate to the conservation and sustainable use of biological diversity and are not harmful to the environment. In addition, one of the aforementioned conditions to be provided in access contracts is research contributing to the conservation and sustainable use of biological diversity. With respect to ex situ conservation it is noteworthy that two International Agricultural Research Centres exist in the Andean Community region: the International Center for Tropical Agriculture (CIAT) and the International Potato Center (CIP). It seems that CIAT and CIP will need to conform fully to the access regulations when they wish to conduct fieldwork. There is a possibility that the work of these centres could be hampered if their activities become strictly regulated. Mechanisms for benefit sharing, including technology transfer and joint research and development Essentially, the Decision seeks to implement the relevant provisions of the CBD in various ways, including by requiring the incorporation of technology transfer requirements into the access contracts. Joint research is referred to in Article 10 but only in the context of subregional cooperation and is therefore not linked to access procedures.
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Means to ensure the maintenance and protection of traditional knowledge, innovations and practices With regard to traditional communities, the Decision recognizes their historical contribution to biodiversity, its conservation, development and sustainable use, and the benefits provided by such contribution. It also acknowledges that the close interdependence between these communities and biodiversity must be strengthened. Communities are not specifically mentioned as potential parties to any of the types of contract described above. But it is possible for them to be parties as suppliers of an intangible component or as owners, holders or administrators of the property on which the biological resource containing a genetic resource is found. To an extent, therefore, the effectiveness of the Common System’s support for community rights depends on the extent to which such communities already enjoy recognition of their land rights and are able to enforce these rights. Given that a particular derivative may have been discovered through the application of an intangible component, the question arises of whether the extension of national sovereignty to include derivatives might conflict with Article 8(j) of the CBD. For example, traditional remedies often consist of plant extracts. Should such extracts be the property (or patrimony as the case may be) of the nation, or of the shaman or community that originally produced it and used it for a particular disease? The tension here may be resolved if the intangible component is separated for legal purposes from the derivative with which it is associated. But if the derivative is of a type that does not occur naturally (such as a plant extract), it is difficult to see why states should claim sovereignty over it. The fact that the Decision excludes from its jurisdiction the exchange of genetic resources, their derivatives and the biological resources in which they are found, and related intangible components among traditional communities and for their own use, does not resolve the confusion. Intellectual property rights The Decision states that any rights, including IPRs, to genetic resources, derivatives, synthesized products or related intangible components obtained or developed through non-compliance with these terms of access, shall not be recognized by the member states. Moreover, national IPR offices having evidence that products or processes for which protection is sought were obtained or developed from genetic resources or their derivatives for which a member state is a country of origin, must require applicants to submit a copy of their access contract as a precondition of the concession of an IPR. Of course, given that the Decision has no legal effect outside the Andean Community member states, it is difficult to see how such patents granted abroad could be challenged. Tangible property The Decision separates genetic resources from biological resources. National
148 Forums, Processes and Initiatives sovereignty extends to genetic resources and their derivatives, but such a right is without prejudice to the systems of ownership applicable to the biological resources containing them, property on which they are located, or to any associated intangible component.
Progress in implementation The Decision has been barely operationalized at the national or international level.2 Only Bolivia has passed implementing regulations, but these have not yet been put into effect. Colombia and Venezuela have opted not to produce implementing regulations, but to apply Decision 391 directly. Moreover, cooperation between the respective governments has been lacking, suggesting a lack of conviction that the cartel approach is superior to the ‘go-it-alone’ strategy whereby each country regulates access without reference to the interests of its neighbours. At the same time, the Decision was intended to be a genuine common system that set uniform rules for the whole region so that the interests of the region would take priority over national interests. It becomes difficult, therefore, for each country to adapt the rules to further its specific needs and interests.
THE COSTA RICA BIODIVERSITY LAW In spite of being one of the smallest Latin American countries, Costa Rica is believed to contain within its borders 4–5 per cent of the world’s biodiversity. On the other hand, the country is culturally quite uniform in comparison with many other Latin American countries. Most of the population is of European descent, although a few indigenous groups exist. In April 1998, the Legislative Assembly of Costa Rica passed the Ley de Biodiversidad, or Biodiversity Law. The Costa Rican experience in drawing up the legislation was characterized by a great deal of stakeholder participation including the involvement of indigenous peoples and local communities. The original proposal for the Law was made by an ex-politician and former president of the Environmental Commission of the Legislative Assembly, who enlisted the technical support of IUCN’s Regional Office for Mesoamerica (IUCN-ORMA) to develop a draft. At the beginning of the process, ORMA and the Environmental Commission agreed on a philosophical framework for the legislation and also its guiding principles, before beginning the first phase of consultations. These consultations included such stakeholders as indigenous peoples, small farmer groups, legal experts, scientists, civil servants and representatives of the private sector. The purpose was to establish the basic contents of the legislation before drawing up the first draft, which was published in June 1996. Once the first draft had been circulated and comments and suggestions had been received, a more substantive draft was drawn up. But progress was stalled due to the wide and conflicting range of views.
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The Environment Commission set up a Special Mixed Subcommission to draw up another draft of the Law. This consisted of representatives of the following institutions and stakeholder groups: • • • • • • • • • •
the National Indigenous Forum; the Costa Rican Federation for Environmental Conservation (FECON); the National Small Farmers Forum; the University of Costa Rica; the National University; the Union of Chambers for Private Business; the National Biodiversity Institute (INBio); the Advisory Council to the Minister of the Environment and Energy (COABIO); the National Liberation Party (PLN); the Christian Socialist Unity Party (PUSC).
The draft was completed in November 1997, and was passed by the legislative assembly in April the following year; it became Law No. 7788 in May 1998. To date this is perhaps the most ambitious and elaborate national law to implement the CBD. The Biodiversity Law was intended to fill a legal gap in the sense that while existing laws covered certain types of natural resources (eg wildlife and forests), there was no specific legislation on biological and genetic resources, and neither were there any specific access and benefit sharing regulations. The Law’s overall objective is to conserve biodiversity, sustainably utilize resources, and distribute fairly the derived benefits and costs, and its 107 Articles cover the full range of issues contained in the CBD including: biosafety; conservation and sustainable use of ecosystems and species; access to genetic and biochemical elements of biodiversity; PIC; protection of scientific and traditional biodiversity-related knowledge through IPRs and/or sui generis systems; education and public awareness; technology transfer; environmental impact assessment; and incentives. The Law has ten chapters of which one is devoted to ‘Access to genetic components and biochemicals and protection of associated knowledge’, and another to ‘Education and public awareness, research and technology transfer’. These are the two main chapters that deal with access and benefit sharing. Article 7 deals with definitions. Within the definition of ‘biodiversity’ is included ‘intangible elements’, which are: traditional, individual or collective knowledge, innovations and practices with real or potential value associated with biochemical and genetic resources whether or not protected by intellectual property systems or sui generis register systems. The intangible element concept is the same as the intangible component of the Andean Community’s Decision 391. The Law sets up a National Biodiversity Management Commission (CONAGEBIO) to formulate and coordinate policy and to oversee implementation of the Law.
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Core elements Prior informed consent The Law does not define PIC other than as the procedure by which providers of biological resources or associated intangible components – who may be the State, private owners, or local or indigenous communities – agree terms for access with users. Consent is required from representatives of the place from which access is sought, who may include the regional councils of Conservation Areas, landowners or indigenous communities. Applications for access are submitted to the Technical Office and need to be accompanied by the PIC of the appropriate stakeholder group. Mutually agreed terms The only direct reference to mutually agreed terms appears in the definition of PIC, which establishes that PIC is the procedure through which mutually agreed terms for access can be negotiated. But Article 63 (‘Basic requirements of access’) implicitly links mutually agreed terms to benefit sharing. Permission for access requires that the terms of technology transfer and equitable distribution of benefits, when there are any, be agreed in the permits, agreements and concessions, as well as the type of protection of associated knowledge demanded by the representatives of the place where the access will occur. In addition, the party seeking access is expected to define the ways in which the said activities will contribute to the conservation of species and ecosystems. Roles, responsibilities and participation of stakeholders As was indicated earlier, a wide range of stakeholders was involved in developing the legislation. Not surprisingly, then, these groups are also involved in overseeing the implementation of the Law through their participation in the work of CONAGEBIO. In fact, CONAGEBIO consists of representatives from various government ministries and agencies, the national protected areas system, the university sector, the private sector, and the national peasants’ and indigenous peoples’ associations. In situ and ex situ conservation and sustainable use The Law links access to conservation and sustainable use in three ways. Applications for access should indicate possible environmental impacts, and its contribution to conservation. And more specifically, 10 per cent of the research budget of the party applying for access will have to be deposited in favour of the National System of Conservation Areas. Mechanisms for benefit sharing, including technology transfer and joint research and development The Law provides few details of the kinds of benefit that might be shared between users and providers. Also, there is no explicit requirement that benefits
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should be linked in any way to future commercialization of genetic resources or TK. However, technology transfer is indicated as a form of benefit sharing to be included in the PIC procedures. And Article 88 (‘Research and technology transfer related to biological diversity’) commits the State to promoting information and scientific technical cooperation as well as access to technologies relevant to the conservation and sustainable use of biodiversity. Although Article 88 is not explicitly linked to access to genetic resources, it can be assumed that such technologies and cooperative relationships may best be achieved through the access procedures. Means to ensure the maintenance and protection of traditional knowledge, innovations and practices Articles 82–85 deal specifically with the intellectual rights of indigenous peoples and local communities, implicitly acknowledging that a final solution to this issue has not been reached by stating that, within an 18-month period, CONAGEBIO was to define a participatory process to elaborate an appropriate sui generis system. Even so, the State already expressly recognizes and protects what is referred to as ‘sui generis community intellectual rights’, ie the knowledge, innovations and practices of indigenous peoples and local communities. Similar in this respect to copyright, these rights have juridical recognition without the requirement of prior declaration or official registration. The participatory process, which will include indigenous peoples and peasants, will determine the nature, extent and conditions of the sui generis community intellectual right, as well as the form the right will take, who will be entitled to hold the legal right, and who will receive its benefits. By means of this process, a registry will be made comprising those intellectual rights that communities wish to register with the Technical Office of the Commission. Such registration will be voluntary and free. The existence of such rights claims in the registry will bind the Technical Office to the obligation to oppose the grant of IPR protection being requested for the same element or knowledge. It is not essential for the right to be officially registered for the refusal to be made, provided that the reason is fully justified. Indigenous peoples and local communities are fully entitled to refuse access to their resources and knowledge for any reason. Moreover, the State will promote the recovery, maintenance and dissemination of traditional technologies and practices useful for conservation and sustainable use of biodiversity. Intellectual property rights Articles 77–85 are devoted to the subject of intellectual and industrial property rights. This section of the Law begins with a statement recognizing the need to protect knowledge and innovations through appropriate legal mechanisms, and refers specifically to patents, trade secrets, plant breeders’ rights, sui generis community intellectual rights, copyrights and farmers’ rights. Remarkably for a
152 Forums, Processes and Initiatives biodiversity law, parameters for the scope of IPR protection permitted by the State are drawn very explicitly. Excepted from IPR protection are the following: 1 2 3 4 5 6 7
DNA sequences; plants and animals; non-genetically modified organisms; essentially biological processes for the production of plants and animals; natural processes or cycles per se; inventions essentially derived from knowledge associated with traditional biological or cultural practices in the public domain; and inventions which, through their commercial exploitation in monopoly form can affect agriculture and livestock processes or products considered basic for nutrition and the health of the country’s inhabitants.
In order to ensure that these exceptions are observed, the National Seeds Office and the Intellectual and Industrial Property Registries are required to consult the National Biodiversity Management Commission,3 a State body set up by this Law, before awarding IPR protection for innovations involving biodiversity elements. In every case, a certificate of origin issued by the Technical Office of the Commission and statement of PIC will have to be presented with the IPR application. Such consent may include that of indigenous authorities in cases where bioprospecting takes place on their lands. Tangible property With respect to property rights, lands and the resources on them may be owned by the State, private landowners or local communities. However, the Law separates the physical elements of biodiversity from their intangible informational aspects. While biodiversity components per se are subject to the exclusive sovereignty of the State, the properties of these components can be owned by nobody, not even those who discover or may be aware of these properties.
Progress in implementation The Biodiversity Law still has not been implemented and the situation is somewhat confused. It is expected that the Law will be subject to some amendments. Furthermore, some of the functions of CONAGEBIO4 have been challenged by the Ministry of Environment and Energy on the grounds that they allegedly violate the constitution. As a consequence of this situation, CONAGEBIO has not been able to receive funds. In spite of this, CONAGEBIO has set up a subcommision to draw up norms for access to genetic and biochemical resources. A draft of the first part of the norms (dealing with general provisions and access permits) was submitted to CONAGEBIO in April 2000 and subsequently published. The second part of the norms deals with intellectual property and community intellectual rights. External funding support is being solicited to initiate the participatory process to develop these norms.
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THE AFRICAN MODEL LEGISLATION FOR THE PROTECTION OF THE RIGHTS OF LOCAL COMMUNITIES, FARMERS AND BREEDERS, AND FOR THE REGULATION OF ACCESS TO BIOLOGICAL RESOURCES In March 1998, the Scientific, Technical and Research Commission of the Organization of African Unity (OAU/STRC) task force on community rights and access to biological resources met to develop a Draft Model Legislation on Community Rights and Access to Biological Resources as a basis for national legislation and an Africa-wide convention. In June 1998, governmental delegates at the OAU Ministerial Meeting in Ouagadougou agreed to recommend that member governments: 1
2 3
4
give due attention as a matter of priority to the need for regulating access to biological resources, community knowledge and technologies and their implication for IPRs as entrenched in the international trade regime of the TRIPS Agreement; adopt the draft model legislation on access to biological resources and call on member states to initiate the process at national level involving all stakeholders in accordance with national interest and enacted into law; initiate a process of negotiation among African countries to formulate and adopt an African Convention on Biological Diversity with an emphasis on conditions for access to biological resources and protection of community rights; and develop an African Common Position to safeguard the sovereign rights of member states and the vital interests of our local communities and forge alliances with other countries of the South on the revision of TRIPS in 1999.
The draft model legislation was further developed and expanded by experts from Eastern and Southern African countries meeting in June 1999 in Lusaka, Zambia. Seeking to implement in a way appropriate for the African continent CBD Articles 8(j), 15(1) and 15(2), the IUPGR, and the TRIPS requirement that plant varieties be protected under an IPR system, the result was a much more substantial document, entitled the African Model Legislation for the Protection of the Rights of Local Communities, Farmers and Breeders, and for the Regulation of Access to Biological Resources. The African Model legislation is not just an ABS or an IPR instrument, but it is both. Its 68 Articles are divided into seven parts, which are: 1 2 3 4
objectives; definitions and scope; access to biological resources; community rights;
154 Forums, Processes and Initiatives 5 6 7
farmers’ rights; institutional arrangements; plant breeders’ rights.
Its main aim is to ensure the conservation, evaluation and sustainable use of biological resources, including agricultural genetic resources, and knowledge and technologies in order to maintain and improve their diversity as a means of sustaining the life support systems. But there are 11 specific obligations in total, which cover recognition of the rights of local communities and breeders, regulation of access to biological resources and community knowledge and technologies, promotion of benefit sharing mechanisms, and various others relating to participation, community rights, capacity building, conservation and the sustainable use of plant genetic resources, agricultural sustainability and food security.
Core elements Prior informed consent Prior informed consent is necessary for access not only to biological resources but also to the knowledge, innovations, practices or technologies of local communities. Consent should be acquired from the State and the concerned local communities, ensuring that women are also involved in decision making. Those seeking access to PIC must apply to the National Competent Authority, and must provide the following information: 1 2 3 4 5 6 7 8 9
the identity of the applicant and the documents that testify to her/his legal capacity to contract; the resources to which access is sought, including the sites from which it will be collected, its present and potential uses, its sustainability and the risks which may arise from access to it; whether any collection of the resource endangers any component of biological diversity and the risks which may arise from the access; the purpose for which access to the resource is requested, including the type and extent of research, teaching or commercial use expected to be derived from it; description of the manner and extent of local and national collaboration in the research and development of the biological resource concerned; the identification of the national institution or institutions which will participate in the research and be in charge of the monitoring process; the identity of the location where the research and development will be carried out; the primary destination of the resource and its probable subsequent destination(s); the economic, social, technical, biotechnological, scientific, environmental or any other benefits that are intended, or may be likely to, accrue to the country and local communities providing the biological resource as well as the collector and the country or countries where he/she operates;
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10 the proposed mechanisms and arrangements for benefit sharing; 11 description of the innovation, practice, knowledge or technology associated with the biological resource; and 12 an environmental and socio-economic impact assessment covering at least the coming three generations, in cases where the collection is in large quantities. This is very detailed compared to most other ABS instruments. Mutually agreed terms Access permits may be academic research permits, commercial research permits, or commercial exploitation permits. The difference between these types of permit is not made clear. Article 11 sets out the terms for all access applicants whether for academic or commercial purposes as follows: 1
2
3
4
The National Competent Authority shall subject all applications for access to a biological resource, a community innovation, practice, knowledge or technology to the prior informed consent of the concerned community or communities. The National Competent Authority shall determine the appropriate conditions to be met under the written agreement required for the grantiing of a permit referred to in Article 8, by academic and research institutions, public agencies and inter-governmental institutions. The application for access for research purposes shall clearly state the objective of the research and the relation of the applicant to industry. Neither the sample nor the associated information shall be transferred without a material transfer agreement reserving the prior rights of the State and/or community or communities. Where the institutions referred to in this Article change their activities to be predominantly the commercialization of a biological resource, the National Competent Authority shall cause the conditions and terms to be varied accordingly.
Collectors are required to comply with the following minimum requirements: 1 2
3
to adhere to a limit set by the National Competent Authority on the quantity and specification of the quality of the biological resource that the collector may obtain and/or export; to guarantee to deposit duplicates of, with complete field information on, each specimen of the biological resource or the records of community innovation, practice, knowledge or technology collected with the duly designated governmental agencies and, if so required, with local community organizations; to inform immediately the National Competent Authority and the concerned local community or communities of all findings from research and development on the resource;
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5
6 7
8
9
not to transfer the biological resource or any of its derivatives or the community innovation, practice, knowledge or technology to any third party without the authorization of the National Competent Authority and the concerned local community or communities; not to apply for any form of intellectual property protection over the biological resource or parts or derivatives thereof and not to apply for IPRs protection over a community innovation, practice, knowledge or technology without the PIC of the original providers; to provide for the sharing of benefits; access shall be conditioned upon a commitment to contribute economically to the efforts of the State and concerned local community or communities in the regeneration and conservation of the biological resource, and the maintenance of the innovation, practice, knowledge or technology to which access is sought; submit to the National Competent Authority a regular status report of research and development on the resource concerned and where the biological resource is to be collected in large quantities on the ecological state of the area; and abide by the relevant laws of the country particularly those regarding sanitary control, biosafety and the protection of the environment as well as by the cultural practices, traditional values and customs of the local communities.
As with PIC, these terms apply to all collectors and collecting institutions whether national or foreign. Roles, responsibilities and participation of stakeholders The stakeholders referred to in the Model Legislation in the context of ABS are as follows: • • • •
the State as represented by the National Competent Authority; collectors; local communities including farming communities, and their women members; academic research institutions, public agencies and inter-governmental institutions.
It is the first three whose roles and responsibilities are most clearly delineated. For example, with respect to the National Competent Authority, its duties as set out in Article 58 are to: 1 2
create and operate a regulatory mechanism that will ensure effective protection of community intellectual rights and farmers’ rights, and the regulation of access to biological resources; carry out the process of consultation and participation of local communities, including farming communities, in the identification of their
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3 4 5 6 7 8
rights as provided for under the customary practices and laws of the communities; identify types of community intellectual rights and farmers’ rights; identify and define the requirements and procedures necessary for the recognition of community intellectual rights and farmers’ rights; develop criteria and mechanisms to standardize procedures; develop a system of registration of items protected by community intellectual rights and farmers’ rights according to their customary practices and law; issue licences for the exploitation and commercialization of biological resources, including protected species, varieties or lineages, and community innovations, practices, knowledge and technologies; identify relevant technical institutions that will assist local communities, including farming communities, in the categorization and characterization of their biological resources, innovations, practices, knowledge and technologies.
With respect to the local communities, the State is required to respect their rights over the following: 1 2 3 4 5 6
their biological resources; the right to collectively benefit from the use of their biological resources; their innovations, practices, knowledge and technologies acquired through generations; the right to collectively benefit from the utilization of their innovations, practices, knowledge and technologies; their rights to use their innovations, practices, knowledge and technologies in the conservation and sustainable use of biological diversity; the exercise of collective rights as legitimate custodians and users of their biological resources.
Plant breeders are another important stakeholder group, although they are not involved in the ABS sections of the legislation. Several other institutions are established to implement the legislation as a whole. These are: • • • •
a National Inter-Sectoral Coordination Body; a Technical Advisory Board; a National Information System; a Community Gene Fund.
In situ and ex situ conservation and sustainable use The legislation applies to biological resources in both in situ and ex situ conditions and has among its objectives to promote the conservation, evaluation and sustainable utilization of biological resources. But it does not deal with conservation or sustainability issues in great depth.
158 Forums, Processes and Initiatives Mechanisms for benefit sharing, including technology transfer and joint research and development Benefit sharing is defined as ‘the sharing of whatever accrues from the utilization of biological resources, community knowledge, technologies, innovations or practices’. But mechanisms for benefit sharing are not well elaborated; neither are the various possible forms that benefit sharing might take detailed. However, the PIC procedures require applicants to inform the National Competent Authority of the intended or expected benefits. Article 12 stipulates that the State and the community or communities shall receive a share of the earnings derived from when any biological resource and/or knowledge collected generates, directly or indirectly, a product used in a production process. At least 50 per cent of such benefits are to be channelled to the concerned local community or communities in a manner which treats men and women equitably. These benefits are to be guaranteed through a written contract between the State and the collector. Means to ensure the maintenance and protection of traditional knowledge, innovations and practices The African Model Legislation is quite ambitious in its treatment of TK, innovations, practices and technologies. It adopts two terms: community rights and farmers’ rights. Community rights include the rights of communities: to their knowledge, innovations, practices and technologies, as well as to collectively benefit from their utilization, and to use them in the conservation and sustainable use of biodiversity: and to exercise their collective rights as legitimate custodians and users of their biological resources, and to collectively benefit from their use. The State recognizes and protects these rights as they are enshrined and protected under the norms, practices and customary law of the concerned local and indigenous communities. According to Article 26, farmers’ rights include the right to: 1 2 3 4 5 6
the protection of their TK relevant to plant and animal genetic resources; obtain an equitable share of benefits arising from the use of plant and animal genetic resources; participate in making decisions, including at the national level, on matters related to the conservation and sustainable use of plant and animal genetic resources; save, use, exchange and sell farm-saved seed/propagating material of farmers’ varieties; use a new breeders’ variety protected under this law to develop farmers’ varieties, including material obtained from genebanks or plant genetic resource centres; and collectively save, use, multiply and process farm-saved seed of protected varieties.
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Intellectual property rights Apart from the section of the legislation dealing with plant breeders’ rights, Article 9 states that patents over life-forms and biological processes are not recognized and cannot be applied for. Consequently, the collector cannot apply for patents over life-forms and biological processes relevant to the regulation of access and use of a biological resource, community innovation, practice, knowledge and technology, and the protection of rights therein. Neither can any other form of IPR protection be applied for in respect of biological resources or parts or derivatives thereof, or over a community innovation, practice, knowledge or technology without the PIC of the original providers. Tangible property The African Model Legislation does not mention any other property than intellectual property. In common with – and possibly inspired by – Third World Network’s Community Intellectual Rights Act, the legislation avoids the word ‘property’ in its description of the rights of local communities. On the other hand, holders of community rights are legitimate custodians and users of their biological resources. Nonetheless, ‘local community’ is defined as a human population in a distinct geographical area, with ownership over its biological resources, innovations, practices, knowledge and technologies governed partially or completely by its own customs, traditions or laws.
ANALYSIS It should be emphasized from the start that hardly any of these instruments have been fully implemented. Therefore, it is still too early to provide definitive conclusions concerning the effectiveness of the ways they deal with the various elements in practice. Nevertheless, some provisional remarks can be made with respect to the potential advantages and disadvantages of each of the initiatives presented above. Prior informed consent The instruments vary in terms of: whether or not they define PIC; and from whom PIC must be obtained – the Competent National Authority, the local community, landowners, or more than one party. Concerning the former, the OAU Model Law provides the most detail on the information that would be required for the consent to be properly informed. This extent of information should not be too onerous for applicants. The other instruments appear somewhat deficient regarding this particular element. With respect to the latter, Decision 391 requires applicants to acquire the PIC only of the State, while the Philippines Executive Order 247 and the Costa Rica Biodiversity Law do not require that the State give its PIC at all, although of course the approval of its representative body is still necessary for access to
160 Forums, Processes and Initiatives be granted. Applicants under the OAU Model Law require the PIC of both the State and the local communities. It seems fair that local communities should have the opportunity to be fully informed about access applications, especially when applicants also desire to acquire TK related to the resources of interest to them. Mutually agreed terms With some instruments, the terms of access vary according to whether the intended bioprospecting is for academic or commercial purposes. This is the case for the Filipino regulations and the African Model Law. It seems reasonable that the terms should be less demanding for academic research than for commercial research. The problem is that drawing a distinction between such kinds of research is not always easy to do. On the other hand, subjecting basic research to onerous terms may be detrimental to the national interest since it may inhibit the carrying out of such research, especially if the regulations apply equally to domestic and foreign applicants. Roles, responsibilities and participation of stakeholders Again, the different instruments vary in the extent to which the various stakeholders are referred to and have their roles and responsibilities clearly delineated. It is not clear at this stage whether it is better to describe the roles of each stakeholder comprehensively or not to do so and leave room for more flexibility. In situ and ex situ conservation and sustainable use Consistency with the CBD requires that conservation and sustainable use – with benefit sharing – should be treated as being the most important objectives of any ABS regulations. Access to genetic resources should go further than simply not harming biodiversity but should actually promote conservation and sustainable use. Among the possible means of supporting conservation and sustainable use, referred to in the instruments, are through access to technologies appropriate to conservation and sustainable use, research, the earmarking of access fees or benefits from commercial use for the national protected areas system, and the creation of a fund. Mechanisms for benefit sharing, including technology transfer and joint research and development A country’s ABS regulations should be seen as a key element of its strategic plan for sustainable development. In this way, the benefits derived from the scientific and commercial use of biodiversity will not just be short term, but will have medium- and long-term capacity-building potential as well. However, not all the instruments place great emphasis on technology transfer and joint research. Decision 391 is quite detailed in this respect, as it seeks to build such capacity at local, national and regional levels. The African Model Law provides
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few specifics concerning the nature of the benefits to be shared except monetary benefits. It is possible that non-monetary benefits, such as technology transfer and joint research, may actually be preferable to cash transfers. Means to ensure the maintenance of traditional knowledge and innovations All of the instruments consider the maintenance of TK to be an important element. However, mechanisms to make it a priority tend to be lacking. The instruments offer a range of approaches, such as requiring benefits to be shared with TK-holders and their communities, making communities parties to access contracts, and the development of a sui generis system to protect the intellectual rights of traditional communities. Generally such sui generis systems are not well elaborated. But this is to be expected. Since there are few existing models for such systems, developing an effective system will require a great deal of consultation with both legal experts and potential users. This is likely to take a long time to carry out, perhaps longer than it takes to develop the basic ABS framework. The Costa Rican approach, therefore, may be the most pragmatic one. Intellectual property rights While the Filipino ABS regulations deliberately avoid IPRs, some of the other instruments place great emphasis on this topic. Some ABS frameworks are premised on the conviction that expansive IPRs encourage exploitative behaviour. Therefore, the right to acquire IPR protection needs to be constrained. Other regulations start with the same premise but, rather than place limits on IPRs, they introduce certain administrative requirements into the IPR system to make it more supportive of the ABS regulations. This is the case with Decision 391, which requires IPR applicants to include a copy of the access contract. The Costa Rican law both constrains the rights and introduces administrative requirements into the IPR system. It is not clear which particular approach is the best one. There is a danger that limiting the freedom of companies and researchers to secure IPR protection will drive applicants away. On the other hand, there is no doubt that some patents are improperly awarded, since the inventions they describe are almost the same as the traditional knowledge or genetic resource acquired by the patent-holding institution. It does seem reasonable, then, to deal with IPRs in some way or another in ABS regulations. Tangible property National sovereignty over genetic resources does not mean that individuals and groups cannot own the land on which the genetic resources exist or the biological material in which they may be discovered. Some of the instruments explicitly separate ownership of genetic materials from biological resources and land.
Part 5
NATIONAL CASE STUDIES
Chapter 14 INDIA
INTRODUCTION India is one of the world’s most biologically and culturally diverse countries. It is also one of the poorest in terms of per capita income. The existence of mass poverty on an enormous scale belies two important facts: first that the country exports natural products that command high prices in overseas markets, such as basmati rice and Darjeeling tea, as well as products like medicinal and aromatic plants that are major inputs in rapidly expanding industries; and second that India has achieved significant capabilities in industrial chemistry and the life sciences. This chapter begins by describing the status of India’s biodiversity, discussing several key developmental priorities, and showing how these could be addressed through wider use and industrial application of genetic resources and increased trade in products derived from them. The next section assesses the country’s present scientific and technological capacities in the public and private sectors as well as at the community level in the context of India’s agreed obligations to reduce trade barriers. In order to benefit from trade liberalization – and in line with current orthodox thinking – the government is encouraging national firms to increase their participation in foreign trade including science-based industries, such as pharmaceuticals, and technologies, such as biotechnology. The aim of this part of the chapter is to ascertain the types of high-value biodiversity-based goods and services in which Indian companies enjoy competitive advantages in international markets or could with the right institutional structures in place. I emphasize the food/agriculture and healthcare industries because of the sheer size of the global markets in products from these industrial sectors. The subsequent section looks at and assesses the prevailing policy and legal frameworks that seek to increase India’s bio-scientific, technological and other capacities to exploit the commercial potential of its biodiversity while conserving its resource base. The final part of the chapter directly answers the question of whether the international intellectual property right (IPR) regime limits or enhances India’s
166 National Case Studies opportunities to add value to its genetic resources while conserving and sustainably using biodiversity.
BIODIVERSITY: CONSERVATION, TRADE AND DEVELOPMENT
The status of India’s biodiversity India is one of the world’s ‘megadiversity’ countries (see Table 14.1), coming ninth in the world in terms of higher plant species richness. At the ecosystem level, India is also well-endowed, with ten distinct biogeographic zones (Ministry of Environment and Forests (MoEF), 1998, p1). It also contains two of the world’s 25 biodiversity hotspots, so-called because of their extraordinarily high levels of species-richness and endemicity, and threatened status (Myers et al, 2000, p853). India is considered to be the centre of origin for the following crop species: pigeon pea, egg plant, cucumber, and possibly cotton and sesame (Hammond, 1995, p127). But for millennia, numerous other crop species have been introduced to India and adapted to localized conditions. As a consequence of both the diversity of these conditions and of the various ethnic populations living in India, the country has become an important centre of diversity of a great many domesticated species, including various cereals, millets, legumes, vegetables, temperate and tropical fruits, fibre crops, and medicinal and aromatic plants (Chandel, 1996, p21). According to the Tata Energy Research Institute,1 India’s biodiversity is threatened by the destruction and degradation of ecosystems, and by overexploitation of species. More specifically, the threats are inter alia due to the following: 1 2 3
Large-scale development projects such as mining and dam and road construction. Conversion of biodiversity-rich ecosystems, such as tropical forests, to farmlands and industrial and residential sites. Poaching of wildlife and over-harvesting of forest products.
While there has been no comprehensive assessment of biodiversity loss, three or four mammal species have been lost since 1950, as have 15–20 plant species. Ten per cent of India’s flowering plant species are threatened with extinction (Kothari, pers. comm., 2001). Of particular seriousness is the loss of agro-biodiversity. In one district of the state of Andhra Pradesh 95 per cent of rice varieties previously cultivated are no longer found (Kothari, pers comm, 2001). Although the causes are various, this situation is due primarily to the replacement of low-input polycultural agricultural systems with higher-input monocultures.
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Table 14.1 Documentation of biological diversity in India TAXA
Number of species India World [endemics]
Percentage of India to the world
Bacteria 850 Viruses Unknown Algae 6,500 Fungi 14,500 Lichens 2,000 Bryophyta 2,850 Pteridophyta 1,100 [200] Gymnosperms 64 Angiosperms 17,500 [4,950] Protists 2,577 [640] Mollusca 5,050 [967] Anthropoda 60,383 Other invertebrates 8,329 Protochordata 116 Pisces 2,546 [78] Amphibia 206 [123] Reptilia 485 [182] Aves 1,228 [60] Mamalia 372 [44]
4,000 4,000 40,000 72,000 17,000 16,000 13,000 750 250,000 31,290 70,000 1,065,000 87,121 2,173 21,723 5,145 5,680 9,672 4,629
21.25 – 16.25 20.14 11.80 17.80 8.46 8.53 7.00 8.24 7.21 5.67 9.56 5.34 11.72 4.00 8.54 12.69 8.03
TOTAL
1,719,183
7.36
126,656
Source: MoEF (1998, pp27–28), using information from the Ministry, the Botanical and Zoological Surveys of India, and Heywood (1995).
Biodiversity and India’s development priorities This section considers the following two aspects: how these resources currently serve as economic and welfare-enhancing assets for the people of India; and in what ways they could benefit Indians even more if greater value could be added to those which have commercial potential. Poverty alleviation and wealth creation Biodiversity is important for all socio-economic sectors of the population. Above all, it offers great subsistence value to rural communities, which can benefit in many different ways from having a wide range of species to exploit rather than just a limited number. Many such communities play a major role in maintaining biodiversity. Some may even increase diversity. Traditional rural communities tend to be an integral part of the ecosystem, since they interact so closely with the local biota. Destroying biodiversity is likely to eliminate the subsistence base of many communities, reducing them to destitution. Gadgil and Guha (1995) refer to members of such traditional Indian communities as ‘ecosystem people’, contrasting them with more wealthy urban ‘biosphere people’ who draw upon – and draw down – the resources of the whole
168 National Case Studies biosphere through their much greater and more resource-intensive consumption levels. Most Indian rural communities are poor, many desperately so. Trading in natural products such as medicinal plants and other items manufactured from local resources can help many poor people to meet their basic needs. Science-based industrial use of biodiversity creates employment, 2 increasing the demand for scientifically-trained personnel. Many of India’s best-educated people find career possibilities limited or even non-existent in their home country. For example, an extremely high proportion of scientists working in the US software and biotechnology industries are expatriate Indians.3 The further advancement of India’s life-science industries is likely to create a virtuous circle by attracting India’s brightest and best, who in turn would contribute to ever higher levels of advancement. Industrial use of biodiversity should also improve India’s trade balance by increasing exports of high-value products and technologies, by reducing imports of these, or both. However, such commercialization of biogenetic resources should not be at the expense of poor rural communities living in areas where the resources were found and who may have played a role in their discovery. Whether industrial users are national firms or transnational corporations (TNCs), such communities should receive a share of benefits. And whether the resource in question is used by them or not, wider use should not lead to scarcities. Food security According to Shariff and Mallick (1999, p1790): ‘India’s nutrition problem is ... not so much one of lack of foodgrains at the national level, as of lack of adequate access to food.’ One of the major dilemmas that India faces – as with other developing countries that are self-sufficient in terms of the quantity of food produced – is that of ensuring food prices are low enough for the urban poor to afford, while at the same time enabling farmers to secure sufficient incomes minimally to cover their costs. Achieving an optimal balance so that both are achieved is hugely difficult. While several intellectuals and activists have condemned biotechnology and argued that the results of scientific plant breeding in India have more often jeopardized food security than improved it, science-based research can contribute to food security by increasing yields, reducing water usage and expensive and possibly dangerous chemical input requirements, and lengthening the shelf-life of perishable foods so that they reach distant markets without rotting (Sahai, pers. comm., 1999).4 A frequently raised development concern is that when agriculture becomes oriented more towards international markets, non-food cash crops are emphasized at the expense of subsistence food crops for local and domestic consumption. Hence, international trade can decrease food security, especially if the benefits accrue mainly to those who are already relatively wealthy. This is a highly complicated issue, but it is sufficient to mention this as a possible consequence.
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A counter-argument is that if local people and the domestic economy as a whole can cost-effectively develop products that are higher in value and that attract a large number of customers in the country or outside it, food security may be enhanced if incomes are increased as a result, especially among the poor. Public healthcare provision Biodiversity is extremely relevant to health. This is obvious to most Indians, since the vast majority of them depend for their health care needs upon folk and classical Indian remedies based largely on plants, other biological material, and minerals. Only about 30 per cent of Indians have access to pharmaceuticals (Lanjouw, 1998, p23). India’s traditional health knowledge can be divided into the classical systems, as documented in ancient texts: the Ayurveda, Unani, Siddha and Tibetan systems of medicine, and local folk knowledge that has not been fully documented (Shankar and Majumdar, 1997). According to Hafeel and Shankar (1999, p28), ‘apart from the 600,000 licensed medical practitioners of classical systems ..., there are over one million community-based traditional health workers in rural India’. Of the 25,000 plant species that exist in the Indian Subcontinent, as many as 8,000 are used medicinally (Pradeep, 1998). In addition, using natural products in traditional health systems, compounds with undiscovered therapeutic applications are bound to exist, given the huge diversities of plants and micro-organisms (see below). Environmental sustainability India’s population, which has just reached 1 billion, is expected eventually to overtake China’s, making it the world’s most populous country. India will need to meet the needs of this enormous population without severely polluting the atmosphere or depleting scarce natural resources. Ways need to be found to ensure that the use and application of the widest possible range of biogenetic resources with economic, health or nutritional value does not lead to over-use and extinction of species. Greater industrial utilization of the country’s biodiversity may become a force for environmental sustainability by signalling that biogenetic resources have potential economic value that cannot be realized as long as the reckless destruction of biodiversity goes on. India’s trade in natural products India has been undergoing a liberalization of its economy, and is gradually becoming more export-oriented in conformity with the conventional wisdom on economic development, and with India’s obligations as a World Trade Organization (WTO) member, which require countries to minimize barriers to trade. It is difficult to establish the proportion of India’s exports and imports that are biological resource-based goods since official indices do not distinguish them from synthetic products in sectors such as the pharmaceutical and crop protection industries, which manufacture both natural products and synthetic substances.
170 National Case Studies Table 14.2 provides figures for exports of agricultural and processed foods over a three-year period (1996–1999), and shows that cereals constitute an annual average of 54 per cent of the total. One high-value product, basmati rice, contributes a substantial share, earning India US$270.2 million, $365.0 million, and $407.8 million of foreign exchange in 1996–1997, 1997–1998 and 1998–1999 respectively.5 Tea is another important export. In 1997, India exported US$384.4 million worth of tea, increasing to $467.9 million the following year.6 Other important exported natural products are fish (US$1,039 million in 1998–1999) and cashew nuts (US$393 million in 1998–1999) (World Bank, 2000). Among the most lucrative single products are basmati rice and Darjeeling tea, both of which command high prices in international markets. India has much to gain by exporting high-value products. But the lower-value bulk products, such as wheat and rice (non-basmati), are extremely important foreign exchange earners and sources of employment that should be considered no less important simply because of their much lower unit value. Moreover, many high-value natural product markets can be quite unstable, especially when substitutes exist. Darjeeling tea is a distinct product in itself, but to an extent it also competes with similar teas. Indian basmati competes mainly with Pakistani basmati, but also with US ‘texmati’, ‘kasmati’ and ‘jasmati’, other speciality rices, and of course with all other rice products. India is also an important exporter of medicinal plants and essential oils (see Table 14.3). Although the export value of medicinal plants is higher, India supplies as much as 20–25 per cent of the world essential oils market (Kulkarni, 1999). There is also an illegal trade in medicinal plants that is not reflected in these statistics. While the figures indicate revenues going to India, medicinal plants and herbal formulations are sold for much higher prices in foreign markets than the prices received by the Indian exporters. Thus there is scope for India to capture much greater value from this sector. Adding value through industrial use may be achieved through any of the following means (De Silva 1997, p38): • • •
isolating pure active compounds for formulation into drugs; isolating intermediates for the production of semi-synthetic drugs; or preparing standardized galenicals (extracts, powders, tinctures, etc.)
For India to capture such added value, these activities will need to be carried out within its borders. It should be noted that India is a country whose high value-added products do not necessarily have to be targeted at overseas markets. With a population of 1 billion and a middle class considered to be about 200 million strong, India itself is a huge market for many of these goods.
The national system of conservation Biodiversity management consists of three types of activity: surveying and characterizing biodiversity; regulating its protection; and ensuring its sustainable utilization.
1,077.395 5,823.234 4,737.776 8,035.914 18,359.176 39,194.534 19,247.218 12,476.338 6,984.518 486.460
77,228.029
Floriculture and seeds Fruits and vegetables Processed fruits and vegetables Animal products Other processed foods Cereals Non-basmati rice Basmati rice Wheat Other cereals
GRAND TOTAL
1.395 7.540 6.135 10.405 23.773 50.752 24.923 16.155 9.044 0.630
% of total
72,707.573
1,371.401 5,852.750 7,614.967 9,083.676 14,948.881 33,835.898 16,859.689 16,850.269 0 125.94
Value (Million Rs) 1.886 8.050 10.473 12.493 20.560 46.537 23.188 23.175 0 0.173
% of total
1997–1998
96,742.066
1,733.690 5,527.722 7,058.753 8,634.855 11,183.483 62,603.563 43,659.019 18,827.532 27.062 89.950
Value (Million Rs)
1.792 5.714 7.296 8.926 11.560 64.712 45.129 19.462 0.028 0.093
% of total
1998–1999
Source: Based on figures provided by the Agricultural and Processed Food Products Export Development Authority (APEDA), Ministry of Commerce, Government of India, 15 March 2000. (1 Million Rs = £14,937.79; US$21,659.09 as at 5 October 2000.)
Value (Million Rs)
PRODUCT TYPE
1996–1997
Table 14.2 Export performance trends for agricultural and processed food products, 1996–1999
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172 National Case Studies Table 14.3 Export of crude drugs and essential oils from India, 1985–1995 (US$ million at 1996 exchange rate) Year 1985–1986 1986–1987 1987–1988 1988–1989 1989–1990 1990–1991 1991–1992 1992–1993 1993–1994 1994–1995 Total revenue
Crude drugs 19.272 16.848 22.489 17.805 25.504 36.802 41.345 48.417 45.355 53.219 327.056
Essential oils 4.553 6.889 4.638 4.974 8.600 5.821 15.592 15.267 19.504 13.250 99.088
Total revenue 23.825 23.737 27.127 22.779 34.104 42.623 56.937 63.684 64.859 66.469 426.144
Source: CHEMEXCIL (1996), in Lambert et al (1997, p31).
There is no single piece of legislation or governmental organization covering all aspects of biodiversity management understood thus. Rather, the ‘national system of conservation’ – in the words of Mugabe and Clark (1998) – consists of ex situ conservation bodies, R&D organizations, human resource institutions, in situ institutions, as well as the norms, regulations and laws which determine their roles, and seek (successfully or otherwise) to ensure they operate effectively and in synergy. So while there is no specific law dealing with biodiversity management in this broad sense, a number of laws are relevant. These include the Environmental Protection Act, 1986, and the Forest Conservation Act, 1980. India has made considerable progress with respect to surveying and characterizing biodiversity from the time that the Botanical and Zoological Surveys of India were established (in 1890 and 1916 respectively). Even so, as many as 400,000 species may exist in India that have been neither identified nor characterized (MoEF, 1998). With respect to in situ conservation, India has a large protected areas system comprising 4.2 per cent of the national territory. The country also has a well developed network of genebanks, as well as botanical and zoological gardens for ex situ conservation. To fill the policy and regulatory gaps, the MoEF is developing a National Biodiversity Strategy and Action Plan (NBSAP), and in 2000 drafted legislation that was passed in 2002 as the Biological Diversity Act. It is likely that provisions relating to access and benefit sharing (ABS) and IPRs will be included in the NBSAP.7 Both issues are central to the Act. In fact, regulating access to India’s biogenetic resources is no less controversial than reforming the country’s patent system. Law and policy-making in both the biodiversity and IPR fields is greatly affected by domestic politics, both parliamentary and extra-parliamentary. Interest and advocacy groups include business associations such as the Confederation of Indian Industry and the Seed Association of India, and some highly vocal and determined national and grassroots-level non-
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governmental organizations (NGOs), many of which have a view on trade and biodiversity that could be described as ‘bio-mercantilist’. Bio-mercantilism in varying degrees of intensity, no doubt a legacy of India’s colonial experience and rooted in the post-colonial ideology – associated with Gandhi and Nehru – of self-reliance, exists throughout the full extent of Indian social and economic sectors. The conventional view among such people is that the country did not benefit when biological resources were the common heritage of humankind and that in order for India to profit from its great biological wealth it must start by strictly controlling the export of biological material. And ambivalence – if not hostility – towards the TRIPS Agreement is often an element of such a viewpoint, especially the section on patents. The patents on ‘Indian’ natural products like neem tree biopesticides, turmeric powder, and basmati rice have provoked a furore throughout India, and is indicative of the perception shared by many Indians that their biological wealth is being plundered by TNCs while successive governments seem unable or unwilling to do anything to prevent it. To a large extent, then, the concern is not just to find ways for Indian people, communities and firms to use resources more profitably, but to prevent unscrupulous foreign individuals and firms from doing so. Consequently, throughout the 1990s, governments were constantly pressured to develop appropriate strategies and laws to prevent the misappropriation of Indian resources and traditional knowledge (TK), and condemned for those policies considered weak or half-hearted. The Biological Diversity Act sets up inter alia a National Biodiversity Authority (NBA). The NBA is empowered to grant or refuse authorization from foreigners and foreign companies (including Indian-based firms not wholly owned and managed by Indians) to access biological resources occurring in India or associated knowledge for purposes of research or commercial use. It will also require authorization for transfer to foreigners or foreign companies of the results of research relating to any biological resources occurring in or obtained from India. Finally, it will require prior approval for applications for IPR protection in India or elsewhere based on any research or information on a biological resource obtained from India. In cases where such approval is granted, the NBA may impose benefit-sharing requirements. The NBA is required to ensure that the terms and conditions of the approval guarantees equitable benefit sharing ‘arising out of the use of accessed biological resources, their by-products, innovations and practices associated with their use and applications and knowledge relating thereto.’ The NBA has some discretion in determining the specific forms that benefit sharing should take, but the following are specifically referred to: 1 2 3
grant of joint ownership of intellectual property rights to the National Biodiversity Authority or where benefit claimers [sic] are identified, to such benefit claimers; transfer of technology; location of production, research and development units in such areas which will facilitate better living standards to the benefit claimers;
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association of Indian scientists, benefit claimers and the local people with research and development in biological resources and bio-survey and bioutilization; setting up of venture capital fund for aiding the cause of benefit claimers; payment of monetary compensation and other non-monetary benefits to the benefit claimers as the National Biodiversity Authority may deem fit.
In addition, the NBA may take measures to oppose the grant of IPRs in any country outside India ‘on any biological resource obtained from India or knowledge associated with such biological resource which is derived from India’. Even before it was passed, the Biological Diversity Act was criticized for creating a bureaucratic structure whose functions in certain respects run counter to the rights and freedoms of researchers and traditional communities (Srinivas, 2000). So while the Act reflects a serious effort to further what is widely considered to be the national interest with respect not only to access to biological resources but also to IPRs, it is not without its faults.
INDIA’S BIO-SCIENTIFIC AND TECHNOLOGICAL CAPACITIES: AN ASSESSMENT Western/industrial life-science and technology capacities India is one of the most advanced developing countries in terms of scientific capabilities, including the life sciences. This is perhaps not surprising considering that India had 869,000 tertiary-level students of natural science in 1990 (Lall, 2000, p44). In the same year the US had only 496,000 (Lall, 2000, p44). India was the only developing country to appear in a survey of the top ten countries for scientific literature citations (Menon, 1997, p99). Of course, it is one thing to produce a large volume of high-quality scientific literature, and quite another to turn scientific discoveries into commercial opportunities. However, when it comes to scientific and technological development, India is again in the forefront among developing countries. Menon (1997, p100) notes that India has research capabilities in a broad range of biotechnologies and biotechnological applications including: • • • • • • •
industrial biotechnology; medical biotechnology; microbial biotechnology; plant molecular biology and agricultural biotechnology; biological pest control; aquaculture and marine biotechnology; animal biotechnology including veterinary sciences, animal husbandry and leather biotechnology;
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• • • •
biochemical engineering; downstream processing; biomedical technology; bioinformation.
In consequence of India’s high standing compared to most other developing countries and the achievements made so far, there is optimism within and outside the government that India is fully capable of harnessing its biodiversity to alleviate poverty, to create prosperity inter alia by expanding trade in highvalue products, and to improve the health of its population. According to Manju Sharma, Secretary of the Department of Biotechnology (pers. comm., 2000), ‘the application of biotechnology on a sustainable basis to utilize [India’s] natural resources can convert the biodiversity into economic wealth for the country’. Similarly, Suman Sahai of the NGO Gene Campaign, and an advisor to the government on both IPRs and biodiversity management policy, argues that India’s strength in secondgeneration biotechnologies like fermentation and tissue culture provides a firm foundation for the better exploitation of India’s biological wealth (Sahai, 1998). Her optimism is partly due to the fact that these technologies are more labour than capital intensive, and that India has a large supply of graduate life-science technicians who are relatively inexpensive to employ (Sahai, 1997). R A Mashelkar, Director General of the Council for Scientific and Industrial Research, expects that more and more TNCs will follow the example of the Swedish pharmaceutical firm Astra (now merged with Zeneca) by setting up R&D centres in India (Mashelkar, 1995, p1172). Other approaches for harnessing and building upon present S&T capabilities that Mashelkar considers feasible are contract research and consultancy services, collaborative research with foreign firms, licensing of technologies developed in India, and specialized testing and training (Mashelkar, 1995, p1172). Table 14.4 shows some of the biotechnology products and processes that had been commercialized by 1992. It also clearly illustrates the major role of public sector institutions such as the National Chemical Laboratory and the National Institute of Immunology in their development. Since 1992 more biotech products have gone on the market in India, including two biopesticides manufactured by processes patented by Anna University in Madras (Jenny, 1999, p13). To what extent is this optimism justified? I now undertake a brief assessment of India’s scientific and technological capacities relating to food and agricultural sciences, and to health. Food and agriculture sciences According to Prakash (1998), ‘agriculture accounts for 30% of India’s GDP and employs over 60% of the workforce’. Since such a high proportion of the population depends on the viability of subsistence and other agricultural systems oriented towards staple foods, it is essential that devoting land and resources towards increased production of export crops does not disrupt the
176 National Case Studies Table 14.4 Selected biotech products and processes in India Product
Institute/company
Fermentation technology Immobilized yeast National Chemical Laboratory Microbial enzymes for IMTECH alcohol Tissue culture Mungbean, black gram, pigeon pea, oil seeds, rice, groundnut Wheat, soybean, grapes Cardamom, sugarcane, rubber Banana, cardamom, papaya, sugarcane Tomato Diagnostic kits Filariasis detection kit
Pregnancy slide tests Dot ELISA pregnancy test Typhoid fever detection kit Amoebic liver abscess detection Blood grouping Detection of hepatitis-B Leprosy immunomodulator
Industry VDSI, Dhanpur Sugar Mills Vittal Mallaya Science Research Foundation, Union Biotech
Bhabha Atomic Research Centre
State Seed Corporation
MACS National Chemical Laboratory Lupin
State Seed Corporation AV Thomas, EID Parry
Madurai Kamaraj University
—
Mahatma Gandhi Institute of Medical Sciences National Institute of Immunology (NII) NII
Cadila Labs Ltd
NII; All India Institute of Medical Sciences NII NII NII NII
Lupin Labs Ltd
Ranbaxy Labs Ltd Ranbaxy Labs Ltd
Cadila Labs Ltd Ranbaxy Labs Ltd Cadila Labs Ltd Lupin Labs Ltd Cadila Labs Ltd
Source: TIFAC (1992), in Menon (1997, p103).
staple foods sectors. However, during the first half of the 1990s, India experienced a contraction in the area of land used for food grain cultivation due to a shift towards cultivation of non-staple crops, including those targeted at overseas markets (Pray and Basant, 1999; Prakash, 1998). Nonetheless, if the wider application of agro-biotechnology can truly satisfy the needs of low external-input subsistence farmers, commercial farmers producing food for domestic consumers and export-oriented cultivators, then gains to one sector
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do not necessarily have to conflict with the interests of the other two. This is, of course, a big ‘if ’, raising such important questions as: What actually are the needs of the various stakeholders within the agricultural sector as a whole? To what extent can the ‘biotechnology fix’ satisfy them? How far is agrobiotechnological research biased so that the interests of some stakeholders are prioritized while those of others are ignored? I do not intend to resolve these questions definitively, but to investigate the possibility that IPRs will have an influence on the progress, directions and dissemination of agro-biotechnology, especially those applications likely to have trade implications (see below). In fact, the evidence provided by Menon and the views of experts such as Mashelkar indicate that India’s agro-biotechnology capabilities are quite substantial as compared to most other developing countries. India has a lot of experience in agricultural research dating back to the colonial era. Most of the research is carried out by the public sector, but since the mid-1980s annual increases in public research have declined. At the same time, the private sector has becoming increasingly committed to research, mainly on hybrids. Private sector plant breeding research expenditure is now about US$4.4 million per annum (Pray and Ramaswami, 1999), and for food and agriculture research as a whole is about US$39–43 million (Pray and Basant, 1999). Agro-biotechnology is applied not only to R&D but is also utilized in the production of exportable products. Acharya (1999, p70) reports that among a growing number of tissue culture companies producing inter alia ornamental plants and flowers are two which have set up biotechnology departments ‘where tissue culture techniques are being applied to a large number of indoor and commercial plants’. Foreign firms are increasingly entering the Indian market and investing in research, as are growing numbers of Indian firms. This can be explained by the fact that India is among the world’s largest markets for agricultural inputs such as fertilizers and pesticides, and also that it has one of the biggest and fastest growing food industries (Pray and Basant, 1999). At the same time, market shares of State-owned corporations have declined while new regulations since 1986 have allowed large Indian and foreign firms to increase their presence in the seed and biotechnology industries. Even so, India is largely an untapped market. For example, as we saw earlier, Indian farmers themselves ‘produce two-thirds of the country’s annual seed requirement’ (Verma, 1995), and many of them are organic farmers by default since they cannot afford to use chemical inputs. This does not mean they can secure good prices, however. This would require their produce to be certified as organic by an independent association. Pray and Basant (1999) note that ‘part of the increase in research in the last decade is due to foreign input firms deciding that the Indian market was simply too big to ignore even if many of the policies were not conducive to high profits’. Among the unfavourable policies mentioned is the lack of strong IPR protection. However, the decision of agricultural input firms to invest in India was not only for this reason since there were also a number of push factors. First, selling agricultural inputs in the developed countries became less profitable from the 1980s, forcing companies in those countries to seek new markets. Second, the life-science industry focus on very expensive research
178 National Case Studies aimed inter alia at integrating different types of product into new packages (such as herbicide-resistant GM seeds with associated herbicides) required them to sell worldwide to cover their substantial R&D expenditures. However, one must be sceptical that the private sector will focus much of its R&D resources on applications that benefit small farmers. Technologies are not just tools: they are also instruments of power and control. The new biotechnologies are a case in point. One possible danger is that companies will only develop products suitable for better-off commercial farmers and disregard the needs of poorer farmers. Another is that they will market products that may benefit farmers in the short term but will, in the longer term, increase dependency and make their livelihoods less secure. For example, Bt transgenic crops are likely to increase productivity but may accelerate Bt resistance among common pests.8 But as long as the public sector maintains its commitment to both second- and third-generation biotechnologies and to prioritize research areas that are unprofitable for the private sector, it would be wrong to assume biotechnology cannot and will not be applied to help small farmers. Health Apart from traditional medicine, India’s health-related S&T capabilities lie mainly in diagnostics, vaccines and fermentation processes, rather than in pharmaceutical products (Menon, 1997, pp100–102). India has some outstanding research institutions, such as the National Institute of Immunology, which is working in, for example, DNA fingerprinting and hybridoma techniques (Menon, 1997, p100). A number of health products developed by the public sector have been commercialized. The private sector consists of 20,000 registered pharmaceutical firms (Abraham, 2000, p98), of which 7–8,000 are actively manufacturing drugs and drug formulations. The top five companies make up about 20 per cent of the domestic market in sales (Abraham, 2000, p98). Investment in R&D is low by developed-country standards but has increased, especially among larger firms. Total R&D expenditure for the industry increased 73-fold between the periods 1965–1966 and 1997–1998, although this still averages only 2 per cent of total turnover as compared to 16 per cent among US firms (Prakash, 1998; PRDC, 1999). Several of these companies are quietly building up their patent portfolios in overseas markets. Ranbaxy has been granted 24 US patents since 1990, and 112 worldwide. Other Indian drug companies actively patenting their inventions abroad are Dr Reddy’s Lab (DRL) with 15 US patents, and Lupin with 10. These quantities are minuscule compared to giants like Merck and GlaxoSmithKline. But, considering that all of these patents have been granted since 1990, the trend is clearly for a steady increase. Although they are mostly for processes of manufacturing drugs rather than for new chemical entities, both Ranbaxy and DRL have discovered several new chemical entities (NCEs) that are undergoing clinical trials. The Indian market is large in terms of volume but small in terms of sales due to extremely low prices. Consequently the more ambitious Indian firms are
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turning their attention to overseas markets where the returns are higher. According to Prakash (1998): Indian firms have established an international niche. Ranbaxy is already the world’s second largest manufacturer of cefaclor (the world’s largest selling antibiotic at US$1 billion a year). Similarly, Lupin is the world’s largest producer of ethambutol, an anti TB drug and DRL is the second largest producer of ranitidine, an antiulcerant. However, as these firms become oriented towards overseas markets but lack the financial resources to turn an NCE into a marketable product by themselves, they are bound to focus on therapeutic areas likely to be the most profitable in those markets and of interest to the TNCs with which they will need to collaborate. There are signs that this is happening. For example, Ranbaxy is now doing research on treatments for long-term (and therefore profitable) ailments like cardiovascular diseases and hypertension (Abraham 2000, p104; Raizada, 2000, pers. comm.). It would be unfortunate if the Indian industry were to focus its attention more on the health needs of North Americans and Europeans than those of the Indian population. But it may be inevitable for large firms to do this as they respond to a worldwide phenomenon common in many industrial sectors: the increasing disintegration of the innovation chain. Rather than conducting all of the expensive and time-consuming drug discovery and R&D in-house, the TNCs often cut costs by outsourcing certain activities such as clinical trials (PRDC, 1999). They also license new chemical and biological entities from other firms that lack the financial resources to bring them to market, as well as new uses and delivery systems for their own drugs. This potentially creates many new opportunities for firms in countries like India to specialize in certain activities (Abraham 2000, pp96–103; Ramanujam, 2000, p271), as long as they do not get locked into the low-value links of the innovation chain. Some of the larger firms are fully aware of these opportunities. For example, Ranbaxy has licensed its proprietary delivery system for ciprofloxacin to Bayer, the company which first developed it. And DRL has licensed a treatment for diabetes to Novo Nordisk, which will conduct the clinical trials and market the final product (Abraham, 2000, pp102–103).
Traditional knowledge and technologies Utilizing India’s existing S&T capabilities also means using traditional biodiversity-related knowledge and technologies. A number of events awakened people to the commercial value of TK. From the mid-1990s the disclosure that patents in other countries, especially the US, were being acquired for inventions closely related to knowledge held by traditional communities in India provoked worldwide protests. In two cases, such patents were successfully challenged on the grounds of lack of novelty by Indian governmental agencies and NGOs. In 1995 the Tropical Botanic Garden and Research Institute (TBGRI) granted an Ayurvedic company, Arya Vaidya Pharmacy, an exclusive 7-year licence to
180 National Case Studies manufacture and sell a product based on extracts of a sub-species of the Trichopus zeylanicus plant called jeevani, which was used by members of the tribal Kani people of Southern India (Bagla, 1999; Pushpangadan, Rajasekharan and George, 1998). To date, perhaps the most profitable health product based on Indian TK is reserpine, a tranquillizer and antihypertensive derived from the medicinal plant Rauwolfia serpentina (Stone and Darlington, 2000, pp132–133). Estimated sales of antihypertensives derived from this plant exceeded US$240 million in 1994 (ten Kate and Laird, 1999, p41). Other commercially promising natural products include Phyllanthus amarus (or niruri), a medicinal plant used in India for treating various ailments including jaundice (Jain, 1991, p142). It was discovered in tests to display effectiveness against viral hepatitis-B and E, resulting in a number of patents, including a US patent9 awarded to the Fox Chase Cancer Center (US) (Shankar, Hafeel and Suma, 1999, pp10–11) for a pharmaceutical preparation comprising extractable components of Phyllanthus, and a European patent10 to an Indian company, Dabur, for a polyherbal composition including extracts of Phyllanthus. Several governmental and non-governmental initiatives are being undertaken to investigate and document traditional biodiversity-related knowledge. Perhaps the most important is the All India Coordinated Research Project on Ethnobiology (AICRPE), which was launched by the government in 1982 and completed in 1998, and involved 27 government organizations including TBGRI, the Central Drugs Research Institute, the Botanical Survey of India, and the Zoological Survey of India (Pushpangadan, 1994). The project focused on various aspects of tribal life, culture and traditions, and aimed to: • • •
generate and document the multi-dimensional perspectives of tribal life, culture, traditions and their impact on the environment; preserve and conserve those traditional beliefs and knowledge systems that promote conservation-oriented practices and sustainable utilization of the local resources; and develop or provide a scientific basis for sustainable resource management as well as to evolve appropriate welfare to improve the quality of life of the tribal communities.
The resulting database, which is held by the Ministry of Environment and Forests, provides a wealth of information on uses of plants and animals by the 70 million tribal people of India. It reveals inter alia that 10,000 wild plants are used for various purposes ‘with 2,000 new claims warranting scientific scrutiny’ (Pradeep, 1998), and that 76 animals are sources of medical treatments. Of these, ‘more than 25 animal products have been short-listed for scientific investigation’ (Pradeep, 1998). The discovery by TBGRI scientists of jeevani’s health-giving properties resulted from an AICRPE expedition. Other TK documentation projects are being undertaken by the M S Swaminathan Research Foundation, the Honey Bee Network,11 and the Indian
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Table 14.5 Total number of practices from Gujarat documented by SRISTI – Honey Bee Network12 Categories of innovation
Quantity
Crop protection Crop production Animal husbandry Grain storage Pisciculture Poultry Leather industry Soil and water conservation Forest conservation Farm implements Organic farming Local varieties of seeds Informal institutions (common property resources) Ecological indicators
1487 264 5329 173 32 51 19 187 46 164 14 30 17 303
Total
8116
Institute of Science (Gadgil and Utkarsh, 1999, p336; Gadgil et al, 2000). According to the founder of Honey Bee, Anil Gupta (1999, p349): The Honey Bee database has more than 10,000 innovations with name and addresses of the innovative/creative communities and/or individuals along with the name of the communicators through whom we have learned these innovations. About 85–90 percent of these innovations are Indian (Gupta, pers. comm., 2000) and fall into 13 categories. Table 14.5 gives the total number of documented innovations from the State of Gujarat. A sister organization, the Gujarat Grassroots Innovations Augmentation Network (GIAN), was established in 1997 to explore commercialization possibilities. Several local innovations in the Honey Bee database have been licensed through GIAN to Indian companies including three herbal veterinary drugs and a kind of bullock cart (Gupta, 1999, p352). So far approximately seven patents have been filed on behalf of innovators (Rai, pers. comm., 2000). An interesting recent development is the Department of Science and Technology’s establishment in 1999 of a National Innovation Foundation (NIF). The NIF, which was initially allocated $5 million by the government, is based on the principles and practices of the Honey Bee Network and GIAN. Its official goals are as follows:13 1 2
To help India become an inventive and creative society and a global leader in sustainable technologies. To ensure evolution and diffusion of green grassroots innovations in a time-bound and mission-oriented manner.
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To support scouting, spawning, sustaining and scaling up of grassroots green innovations and link innovation, enterprises and investments. To strengthen R&D linkages between excellence in formal and informal knowledge systems and create a Knowledge Network. To promote wider social awareness and possible commercial and noncommercial applications of innovations.
No other government has made such a significant official commitment to harnessing TK for sustainable development.
Where do India’s competitive advantages lie? Much if not most of India’s huge stocks of in situ biological resources have not been fully investigated scientifically. This suggests the likelihood of there being some considerable commercial possibilities remaining to be ascertained. There are grounds for optimism, then, but also for caution. Pray and Basant (1999) refer to a foreign company that has been screening plants collected from India for biopesticidal properties for 20 years. The fact that this company has still not developed a commercial product shows that deriving commercial benefits from the discovery of new genes and compounds even in biodiversityrich countries is far from easy. India’s trade potential with respect to natural products and their derivatives should be assessed according to the extent of the demand for such products, and of the ability of the country to supply the various international natural product markets. On the demand side, the potential is huge. On the supply side, India should be well placed to substantially increase its export performance in all of the various natural product markets. Success depends upon how effectively India can apply its biological and human resources to increase market shares, especially in the major importer countries. Among the interesting possibilities are pharmaceuticals, botanical medicines, cosmetics and toiletries. And as we saw, India is already one of the main exporters of essential oils. Success depends on many factors: efficient production methods, quality control, good marketing, and also on friendly trade and health product regulations in importing countries. But above all, success hinges on the extent to which India can apply and improve upon its science, technology and production capacities to discover commercial applications for its biological resources, turn them into products, and market them successfully. In the case of products requiring especially large R&D investments, partnerships with foreign firms are likely to be essential. It is worth mentioning at this point that applying and improving S&T capacities, marketing new products, and collaborating with foreign firms are all IPR-related issues. An accurate assessment of India’s competitive advantages from the wider application of the new biotechnologies is complicated in the sense that they are generic technologies. That is to say ‘they are radically altering techniques and systems in wide areas of production and distribution’ (Bhagavan, 1997, p5) that promise to transform a broad spectrum of industrial sectors. The likelihood is that many
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applications remain to be discovered. So the situation looks fairly promising overall. Discussion of competitive advantage begs the question of how important it really is for a country like India. Compared to smaller countries, it is conceivably less important because firms can become large by international standards catering exclusively for the domestic market. Expert-led development may not be as beneficial a strategy as it was for countries like Switzerland and the Netherlands in the 19th century and South Korea in the 20th. On the other hand, it can still be advantageous for Indian firms to export, especially to developed countries. Profit margins are likely to be higher than in the domestic market and competition in outside markets should encourage participants to achieve and maintain high-quality and efficient production standards.
Trade and biodiversity conservation: is there a conflict? There are now two questions to be addressed. First, to what extent are India’s agricultural and health systems based upon its own biogenetic resources? And second, in what way might the export of high-value-added agricultural products and processed foods, and health products be linked to conservation and the sustainable use of biodiversity? Food and agriculture Not even the most biodiversity-rich countries are self-sufficient in biogenetic resources for food and agriculture. However, to a greater extent than many, India’s agricultural system is based on crops that either originated in India or have been cultivated there for centuries, and which have diversified genetically since their introduction to India. Even so, the public sector network of genebanks held at public institutions (such as the National Bureau of Plant Genetic Resources, the Indian Agricultural Research Institute, the Central Institute of Medicinal and Aromatic Plants, and the TBGRI) receives germplasm from more than 80 countries (Paroda, 1996, p46), and this is stored for the use of both public and private sector breeders. It is difficult if not impossible to quantify the dependence of India on foreign germplasm. Pray and Basant (1999) consider imports of commercial seed for field crops to be ‘negligible’, but for vegetable seed imports are somewhat larger in volume. Sectors which are especially dependent on foreign resources include poultry and flowers (Pray and Basant, 1999). While the Indian seed industry depends almost entirely on germplasm available in public collections, companies seeking to develop new biopesticides are interested in natural products used in traditional agriculture, such as neem tree extracts and plant growth regulators (Pray and Basant, 1999), as well as bioprospecting. As to the future, India’s tremendous range of agro-climatic zones means the country has a large diversity of biogenetic resources to draw on in addition to associated TK. This suggests that India has the potential to transform its food and agriculture industries through wider use of its own resources and associated knowledge (Sahai, pers. comm., 1999).
184 National Case Studies Turning to the link between food and agriculture on the one hand, and conservation and sustainability on the other, there is arguably a basic incompatibility between trying to increase agricultural productivity and protecting the environment. Undoubtedly, converting biologically diverse ecosystems such as tropical forests and low-input polycultural agro-ecosystems into high-input monocultural croplands and plantations reduces biodiversity. Moreover, traditional agro-ecosystems and small farms may actually be more productive than big farms cultivating single crop species. This is because while output per hectare of any one crop may not necessarily be as high, the costs associated with traditional agriculture are much lower, and they are more labour intensive (Rosset, 1999). How might biotechnology enhance productivity without eroding biodiversity? Biotechnology has the potential to benefit poor farmers if it can help reduce their dependence on external inputs. Tissue culture greatly increases opportunities to conserve and store germplasm, accelerate plant breeding, and replace diseased or low-yielding plant material with disease-free or high-yielding varieties. For Walgate (1990, pp7–8) the benefits of agrobiotechnology for developing countries are essentially threefold: 1 2 3
It increases the resistance of high-yielding modern crop varieties to pests and disease, and extends their ability to thrive in harsher conditions. It increases the productivity of crops grown in marginal lands. It improves certain food and cash crops that have proved resistant to conventional breeding.
These, of course, are not the same as conserving biodiversity or encouraging its sustainable utilization. But if biotechnology can be applied to improving exportable food and cash crop varieties, and enhancing the productivity of existing ones, it could reduce pressure to bring more land, including biodiverse areas, into cultivation. Such a consequence is speculative, however. Another possible consequence is that, as the cultivation of certain crops becomes more profitable, the area of land used for the same purpose will be expanded. However, turning from S&T considerations to marketing strategy, opportunities definitely exist for expanding the export of biodiversity-friendly products. Growing numbers of consumers in developed countries are demanding foods produced by environmentally preferable methods that do not exploit local communities, and are thus willing to pay higher prices for organic and fair trade produce. Increased affluence in the developed-country markets can also make it possible for new high-value products to become profitable. It is worth bearing in mind Von Moltke’s observation (1998, in Downes, 1999) that: It has been argued that a good strategy for commodity producers – notoriously at the mercy of market forces – seeking to gain greater control over markets and prices is to segment the market by differentiating different types of products within the commodity market.
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It is possible that such IPRs as trade marks, geographical indications and labelling (including eco-labelling) can help to reinforce such market segmentation and ensure profitability in competitive markets. Darjeeling tea producers have benefited from high prices in domestic and international markets in part through the use of trade marks and labelling. Genuine Darjeeling tea carries a trade-marked logo which is the property of the Tea Board of India. In those countries where the trade mark is held, only such tea can be referred to on the packaging as ‘Darjeeling’, ‘pure Darjeeling’ and ‘100% Darjeeling’.14 Organic Darjeeling tea is also exported. Organic tea gardens are certified by two international organizations, the Institut für Marketecologie, and Naturland-Verband. Health The case has already been made that the health of most Indians depends heavily on a tremendous variety of native species of plants (as well as other organisms). However, many of the largest domestic pharmaceutical firms, such as Ranbaxy, Cipla, Lupin and DRL, which are beginning to expand their in-house R&D facilities, are not primarily interested in bioprospecting or screening Ayurvedic or other traditional formulations. Nevertheless, an increasing number of firms, for example Maharishi Ayurveda Products, Zandu and Dabur, are seeking to tap into the growing demand for botanical medicines and Ayurvedic treatments abroad (Sahai, 2000). Demand has grown in Japan, Europe and North America to the extent that India’s exports increased by 60 per cent between 1994 and 1997 (EXIM Bank, 1997a, p53). To take the example of one company: ‘Maharishi Ayurveda Products is planning to enter the roughly US$4 billion Japanese market with a portfolio of 120 ayurvedic products. This will include food supplements, aromatic oils, cosmetics and body care products’ (UNCTAD, 2000, p18). There is still much to be done before India benefits substantially from commercial use of its huge diversity of medicinal plant species. While India is the world’s leading exporter of raw medicinal plants, it only reaches fifteenth place as a producer of herbal health products (EXIM Bank, 1997a, p70). Companies marketing botanical medicines and Ayurvedic treatments in India and abroad use plants that are mostly native to India. Although this suggests the possibility of creating incentives for conservation, 95 per cent of the medicinal plants used by industry are collected from the wild (EXIM Bank, 1997a, p12). Harvesting is frequently carried out with no consideration of longterm sustainability. Consequently, many species are in serious danger of being over-harvested out of existence. According to Bose (1999b) ‘nearly 100 medicinal plants are facing extinction in India and the government has banned formulations derived from 84 plants’. This is especially unfortunate given that India’s range of agro-climatic zones makes it suitable for cultivating most of the medicinal plants that are traded (EXIM Bank, 1997a, p14). So if present trends continue, as exports of plant-based medicines increase there will be a reduction of biodiversity. This would, of course, be detrimental to those millions of Indians who depend on the existence of medicinal plants for
186 National Case Studies their health or their livelihoods. Clearly, measures must be introduced to encourage the conservation, sustainable use and cultivation of medicinal plants. An interesting development in the middle of 2000 was the government’s announcement that it would ban the export of raw medicinal plants (Mathew, 2000). The intention behind the decision is to encourage value addition in India while protecting the resource base. It remains to be seen whether such a measure will succeed. Enforcement will be extremely difficult and illicit harvesting is very likely to go on as before.
IMPLEMENTING TRIPS: CURRENT PROGRESS At the time the Uruguay Round was concluded, the patent law in force was the Indian Patents Act (1970). It remains in force today with some amendments. Although the Patents Act replaced the colonial-era Patent Act of 1911, the new law in certain respects had more in common with early 20th-century European practice in its limitations both on what could be patented and on patent holders’ rights. The earlier Act was considered too favourable to right-holders who, in the case of chemicals, foods and drugs, were most likely to be TNCs. In contrast, the 1970 Act includes in the list of what are not inventions ‘methods of agriculture or horticulture’. And with respect to inventions ‘claiming substances intended for use, or capable of being used, as food or as medicine or drug, or relating to substances prepared or produced by chemical processes’, only the methods or processes of manufacture can be patented, not the substances themselves. The term ‘medicine or drug’ includes inter alia agrochemicals (ie ‘insecticides, germicides, fungicides, weedicides and all other substances intended to be used for the protection or preservation of plants’). For inventions claiming methods or processes of manufacturing substances intended for use, or capable of being used, as food or as a medicine or drug, the term of the patent is the shorter of five years from the date of granting the patent, or seven years from the date of submitting the application and complete specification. For any other invention, the term is 14 years from the date of application. Rao (1999, p6) points out that the patent law does not explicitly prohibit the patenting of living organisms or biotechnological inventions, though the spirit of the act is against such patenting. However, a number of plant biotechnology applications have been granted including one to a US biotechnology firm Agracetus for ‘Methods of Producing Transformed Cotton Cells by Tissue Culture’ (as a chemical process patent).15 Nonetheless, the language of the Act evidently precludes more than a small number of patents on biotechnological inventions from ever being granted. To encourage the production of goods in India and to prevent importers from monopolizing their supply, the Act allows for the possibility of revocation on the grounds of non-working. Merely importing patented products and products made by a patented process does not constitute working of the patent.
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The Act also allows greater possibilities to acquire a compulsory licence than does TRIPS. Even so, this provision has only rarely been exploited (Ganguli, 1998a, p138). In addition, all process patents relating to drugs, foods and agrochemicals are endorsed with the words ‘licences of right’ from three years after the patent has been sealed (ie granted). This means that ‘any person who is interested in working the patented invention in India may require the patentee to grant him a licence for the purpose on such terms as may be mutually agreed upon’. If such agreement cannot be reached, either party may request the Controller of Patents to determine the terms upon which the licence may be granted. It is also possible for the applicant to request permission from the Controller to work the patent on such terms as the Controller of Patents may think fit to impose. The Act reflected a conscious attempt at consistency with constitutional provisions concerning the fair distribution of wealth, resources and means of production (Keayla, 1999, p29). It was intended to achieve greater self-reliance, and reduce dependency on foreign companies for the supply of strategic products and medicines in line with other government policies.16 According to Ganguli (pers. comm., 2000): A key factor that was considered while framing the Indian Patents Act 1970 was socio-economic and science and technology status of India in the year 1947 when she came off British Rule. The emphasis was on self reliance, capability building and a drive to meet the daily needs of the Indian people in a cost-effective and affordable manner. The present patent system, however well or badly it functions in practice, definitely serves the interests of the domestic industry much more than those of the TNCs. This is not because it allows local firms to patent processes for making drugs and agrochemicals developed by foreign companies, but because the local drug and agrochemical firms can copy freely, sell for a profit at low prices (by international standards), and export to other countries where patents on the same products do not exist. Given the short period of protection, most domestic firms did not find it worthwhile applying for patents on their processes. It takes anything from 5 to 8 years to acquire a patent (Ganguli, 1998b, pp56–57), and in early 2000 the 30 examiners of the Indian Patent Office had to contend with a backlog of 33,000 applications going back to 1994 (Ahmad, pers. comm., 2000; Trivedi, pers. comm., 2000), a year when the number of applications began to increase significantly (Ganguli, 1998a, p140). Given the exceptions to patentability, the huge backlogs, and the limitations on the rights once they are granted, the sharp fall in the number of patents in force in India between the early 1970s and the mid-1990s, from over 30,000 to less than 10,000 (Ganguli, 1998a, p139) seems entirely understandable. Measured against the objectives of the Act, however, a strong case can be made that it has been successful. According to Ganguli:
188 National Case Studies This protected patent regime provided a safe platform on which pharmaceutical and chemical industries could strike roots and grow in India and also meet the need to increase production rather than relying on imports, which was critical for the national economy. For example, pesticide imports were reduced from around 12,000 tonnes in 1965–66 to a mere 1100 tonnes in 1992–93 (Ganguli, 1998a, p131). Moreover, the share of Indian firms in the supply of bulk drugs and formulations for the domestic market has significantly increased since the Act came into force in 1972, as has the number of people employed in the pharmaceutical industry. Both were a result of the Patents Act and related measures introduced around the same time (such as import restrictions and price controls) to enhance self-sufficiency (Lanjouw, 1998, p4). Almost certainly the incentive for agrochemical and drug firms to develop new processes was driven less by the possibility that they could patent these processes than by the freedom they had to copy in the absence of product patent protection. Like Germany and Switzerland in the late 19th century, India had deliberately excluded product patents to exploit and further develop its capabilities in organic chemistry. And, just as it was for these two countries, the strategy was a success. The current patent regime is fundamentally incompatible with TRIPS. But implementing the TRIPS requirements relating to patents and the protection of plant varieties has been a political ‘hot potato’ for successive governments since 1995. This is because of the common perception among domestic firms, politicians and the educated public that the present law has successfully furthered the national interest, and that TRIPS represents a defeat for India. Consequently, India failed to keep pace with the transitional periods. The first step towards TRIPS compatibility came in March 1999 when the Patents Act was amended following a WTO dispute with the US. In November 1996 the US had requested the WTO Dispute Settlement Body to establish a panel because of the alleged failure of India to comply with Article 70.8 of TRIPS, that is to provide a ‘mailbox system’ for the filing of patent applications for pharmaceutical and agrochemical products, and a legal authority for the granting of exclusive marketing rights (EMRs) for such products. The Panel and Appellate Body concurred that India had failed to comply with its obligations in this regard, and the parties in dispute agreed to accept the decision. The Patents (Amendment) Act, 1999 provided the mailbox facility and EMRs, but with the exception that EMRs would not be allowed for products based on Indian traditional systems of medicine. Another bill was introduced into Parliament in December 1999, known as the Patents (Second Amendment) Bill, 1999. This was eventually passed into law and is now the Patents (Amendment) Act, 2002. The Act aims, among other things, to make the Indian patent regime compliant with the TRIPS stipulations on compulsory licensing and the 20-year minimum term of protection, and to make more explicit the exceptions on patenting life-forms (except microorganisms) that TRIPS permits. Thus, it excepts from patentability: ‘plants and animals in whole or any part thereof other than micro-organisms but including
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seeds, varieties and species and essentially biological processes for production or propagation of plants and animals’. It also introduces safeguards with respect to biodiversity and TK, adding two additional grounds for pre-grant opposition to the grant of a patent and also for revocation: that the complete specification does not disclose or wrongly mentions the source or geographical origin of biological material used for the invention; and that the invention so far as claimed in any claim of the complete specification is anticipated having regard to the knowledge, oral or otherwise, available within any local or indigenous community in any country. If we assume these provisions are TRIPS-compatible (and this is a reasonable assumption to make), they support an argument that there is sufficient flexibility within the global IPR regime for rewards and incentives favourable to developing-country providers of biogenetic resources and TK, and products derived from them, to be introduced at the national level. On the other hand, TRIPS imposes no obligations on developed-country users of these resources and associated TK to introduce supportive measures. But a more serious problem than what TRIPS actually states or does not state is that some governments, notably the US, have their own views on what is and is not TRIPS-compatible, and the capability effectively to pressure developing countries to see things their way. In fact, the Office of the United States Trade Representative (USTR) (2000a, p160) notes that ‘certain provisions of the Bill appear to be TRIPS inconsistent’, but does not specify which ones. Ominously, the USTR’s 2000 Special 301 Report (2000b, p8) warned that ‘there are a number of … WTO Members that … appear not to be in compliance with their TRIPS obligations, and which we are still considering as possible future dispute settlement cases’ [emphasis added]. India was mentioned as one of these countries. With respect to plant variety protection, the Indian government chose the sui generis option by drafting the Protection of Plant Varieties and Farmers’ Rights Act, which was passed by parliament in 2001. The main objectives are threefold: to stimulate investments for research and development both in the public and the private sectors for the development of new plant varieties by ensuring appropriate returns on such investments; to facilitate the growth of the seed industry in the country through domestic and foreign investment which will ensure the availability of high-quality seeds and planting material to Indian farmers; and to recognize the role of farmers as cultivators and conservors [sic] and the contribution of traditional, rural and tribal communities to the country’s agrobiodiversity by rewarding them for their contribution through benefit sharing and protecting the traditional rights of farmers. While sharing similarities with UPOV 1978, additional provisions are included to protect the interests of public sector breeding institutions and the farmers. For example, the Bill upholds ‘the right of a farmer to save, use, exchange, share or sell his farm produce of a [protected] variety’ except ‘in case where the sale is for the purpose of reproduction under a commercial marketing arrangement’.
190 National Case Studies The Act appears to reflect a genuine attempt to implement TRIPS in a way that supports the specific socio-economic interests of all the various producer groups in India, from private sector seed companies to public corporations and research institutions, and resource-poor farmers. However, India is in the process of joining UPOV under its 1978 Act, and it seems certain that the 2001 legislation will need to be modified.
TRIPS AND THE NATIONAL BIO-INDUSTRIES: THREAT OR OPPORTUNITY? It should now be possible to answer – in the Indian context – the question of whether the global IPR regime is helping or failing to provide an enabling environment for India to add value to its biogenetic resources while conserving and sustainably utilizing the resource base. In answering the question, I will treat the food/agriculture and health sectors separately. This is because the challenges and opportunities they face vary somewhat. It is important before proceeding to bear in mind that what is possible legally may not be possible politically. This point requires a brief explanation. Legally, India may choose to interpret TRIPS creatively with the aim of minimizing threats and maximizing the opportunities felt to exist. It might seek, for example, to exploit the full range of exceptions and restrictions on the rights it has to provide in accordance with its own interpretations of the relevant provisions in TRIPS. India might choose to define the term ‘micro-organism’ narrowly or ‘ordre public’ expansively. But to what extent will India be able to get away with doing this even if its interpretations are consistent with TRIPS? The likelihood is that certain governments and economically powerful interest groups will challenge any such interpretations that conflict with their interests. India may thus be pressured to concede even on points of interpretation where its legal position is strong. Resistance to pressure may be undermined by, for example, promises of trade concessions in other areas, or threats to withdraw concessions already granted. In short, the analysis must accommodate wider political realities. This underlines the fact that the global IPR system consists not just of the WTO, WIPO, and the various multilateral agreements and treaties; the US government and, albeit to a lesser extent, the European Union, Japan and some of the key business associations, also play the role of enforcers and standard-setters.
The food and agricultural sectors What is the likely impact of the global IPR regime on efforts to increase both value addition and trade in agricultural products based on India’s biogenetic resources? The evidence provides no easy answer. The full effects are unlikely to be entirely good or bad. So what we really need to know is whether on balance the impact will be negative as measured, not just in terms of monetary receipts but also taking into account human welfare and the state of the environment. The
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emphasis of this book on enhancing value addition and boosting export and domestic trade performance does not mean welfare considerations should not be entered into the equation. If the incomes of poor Indians do not increase as a result, one must question whether such economic achievements are a good thing after all. In fact, based on the evidence gathered here, the likelihood is that the impact of the global IPR regime may be positive in terms of value addition and export performance, but the difference will not be great. If gains prove to be at the expense of poor Indian farming communities they are very unlikely to provide appreciable improvements to the state of India’s biodiversity. In what ways could the global IPR regime improve India’s export performance? With respect to plant varieties, since India has clearly opted for the sui generis approach, only non-hybrid varieties will be affected. Since hybrids do not breed true to type, unauthorized reproduction and sale of varieties with identical qualities is precluded.17 As for agro-biotechnology, while life-forms other than micro-organisms will not be patentable, the range of patentable biotech-related products and processes will of course increase, as will the term of protection. Agro-biotechnology is very important in this context since it has the potential to enhance the quality, range and price competitiveness of both processed and unprocessed agricultural products. In addition, IPR-protected agro-biotech processes and research tools are marketable ‘products’ in their own right that can be sold or licensed. But mostly what we need to assess is the shorter- and longer-term influence of PVP and patents on the export trade in agricultural products. It is also worth assessing the value-addition possibilities of using non-patent IPRs such as trade marks and geographical indications, areas where India has already passed laws. Plant variety protection, value addition and trade At present, India’s seed industry is mainly interested in supplying domestic demand. This is unlikely to change as the new regime comes into force. Therefore, it is probably more interesting to estimate the impacts of PVP on domestic commercial activity. In the context of seeds and plant varieties, value addition is realized in the market place for three types of product: seeds and other propagating material; harvested produce; and processed goods based on these seeds and harvested products. Here I will focus on the first two product types, seeds and harvested produce, since the relationship between PVP and the third type, processed goods, is more tenuous. Two questions immediately arise. First, in what way can we say that the breeding of new varieties adds value to biodiversity? Second, if seed products have greater commercial value than that of the sum of genetic material that breeders introduce into them, does this encourage conservation? Plant breeding and value addition Value addition does not necessarily require breeders to create something new or better than what already exists in nature or in a traditional farmer’s field.
192 National Case Studies Neither would it be accurate to suppose that breeders create value from nothing, even though the germplasm they use is normally a free input. In fact, a genetic trait identified in such germplasm and used to develop a ‘new’ variety may already be known to and highly valued by traditional farmers. It may even have economic value in its own right if it benefits farmers commercially, for example if the trait makes the crop more nutritious and enables the farmer to charge a higher price. Of course, it is very difficult to capture the value of single genetic traits anyway, and while they may be patent protectable in some countries (as may the plants into which the trait is inserted), they are otherwise not appropriable as products per se. The point is that a new variety’s profitability may be due to factors other than that the seed company has created something substantially better than the folk varieties that may have been used as sources of useful (but inappropriable) traits. For example, it may simply be because the trait has been inserted into a commercial product (ie a seed) that traditional farmers do not normally treat it as a commodity. Another possible reason is that the new variety is being purchased by large numbers of farmers primarily due to good marketing and/or the company’s widespread distribution network. It may also be because the company has a good reputation for providing reliable and disease-free seed. In short, adding value is not simply a matter of improving what already exists, but may have more to do with creating markets for things not previously considered to be products (eg seeds), as well as effective and efficient distribution, marketing, quality control and customer service. Plant breeding and conservation With respect to conservation, we need to be clear that Indian seed companies (like those elsewhere) tend to use germplasm that has already been collected rather than going on bioprospecting expeditions. Even so, since plant breeding is dependent on inputs of fresh germplasm into the system of exchange, breeders do have an economic interest in the condition of the resource base, and therefore an incentive to help conserve it. But this does not of course mean they will actively seek to protect it. Indeed, at present they do not seem to be greatly concerned with in situ conservation. This is not really surprising given the quantity of germplasm already in circulation, and the fact that no individual company has an incentive to act unilaterally if rival companies would also benefit. As for the farmers, does their use of new varieties encourage them to conserve the resource base? At present the answer is very simple: since the wider adoption of new crop varieties is so closely associated with the spread of monocultural agriculture, their use encourages the erosion of the resource base. Farmers who do not use new varieties are more likely to continue with polycultural agro-ecosystems that maintain biodiversity. But whether farmers should adopt new varieties and monocultural agriculture or continue with their traditional varieties and cultivation systems should be a matter for them to decide. Their choice will depend on whether the breeding of these new varieties benefits them by increasing productivity (as defined by themselves)18 and/or
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sustainability. In other words, the farmers’ rate of return from the use of new varieties should be high enough to warrant purchasing these seeds. And if they are prevented from saving seed in the future, the rate of return will have to be high enough to make it worth their while buying seeds every growing season, assuming of course that by then they will still have alternatives such as local landraces. Otherwise, they will not be interested in buying the seeds, and there will be no incentive for anybody to conserve the resource base on the basis of its use in plant breeding. In short, it seems inconceivable that a seed industry could exist if social rates of return were low. Turning more specifically to PVP, to what extent will the type of system that is likely to be adopted in India encourage value addition at the level of seeds and agricultural products and encourage protection of the resource base? First, the private seed industry’s commercial orientation means that it focuses on research likely to have profitable outcomes. Insofar as PVP encourages such R&D, it is likely that their products will benefit many Indian farmers, but that many others will be excluded. This need not matter greatly unless the public sector withdraws from research oriented towards resourcepoor farmers. If so, the latter may find themselves increasingly marginalized. In the long term this may not be harmful for India’s development, since the experience of all developed countries is that as industrialization has taken place and average income levels have increased, the numbers of people working on the land has decreased. But, if in the short term there is greater unemployment in rural areas without the blotting paper of new jobs in urban areas to soak up this surplus labour, mass destitution on a massive and unjustifiable scale could ensue. So what is the evidence to support the notion that PVP will create incentives to develop new varieties that farmers will want to purchase but that research benefiting the resource-poor majority will diminish? In fact the evidence from India and elsewhere suggests that we cannot be at all certain that PVP will increase the number of varieties available that provide clear benefits for farmers. According to Rangnekar (2000c), who considers the empirical evidence from the UK and the US, PVP protection in India will probably increase the rate of private investment in R&D and consequently the number of varieties on the market.19 But even if this does happen, it is not necessarily the same thing as encouraging greater innovation (in its narrow sense). Rangnekar suggests that ‘varieties may be genetically similar (ie like overlapping patents), some may be agronomically inferior and some may be cosmetically differentiated (ie strategies of product differentiation)’ (Rangnekar, 2000c). Therefore, in the absence of a legal requirement that protected varieties must demonstrably provide a qualitative advantage, farmers will not necessarily be better off. This begs the question of why farmers would want to purchase new varieties that are no better than old ones. As we saw earlier, Rangnekar has argued that breeders have an incentive to adopt strategies of planned obsolescence. With respect to research priorities, empirical evidence from India, the US and elsewhere suggests that the private sector tends to orient its research
194 National Case Studies towards crops providing high returns, especially hybrids, and that the introduction of IPR protection will not change this significantly. As for the structure of the seed industry, PVP is likely to act as a barrier to entry for new firms and thereby contribute to consolidation of the seed business (Rangnekar, 2000c). As the number of seed firms decreases, those remaining in business will be able to raise their prices, and if farmers lack alternative sources of seed they will have no choice but to pay these prices. This is not at all an immediate problem, though, given the point made earlier that the overwhelming majority of farmers do not acquire their seed from the private sector. Related to this issue is the concern felt in India that PVP will encourage TNCs to take control of the seed industry and that this will be detrimental to farmers and domestic seed companies, especially the smaller ones. It is difficult to tell whether the increasing influx of transnational corporations into the Indian seed sector is a good or bad thing on balance. On the one hand, their participation may stimulate innovation across the industry through increased competition and technological spillovers, and may also bring foreign germplasm into the exchange system. Conversely, a small number of them may at some time in the future completely dominate the market by buying up the larger firms and pushing the smaller ones out of business. This may be alarmist in view of the extent of seed saving, but the scepticism among critics that TNCs will transfer their proprietary technologies to domestic firms may be justifiable in view of the potential magnitude of the Indian market and the existence of domestic firms that could become rivals. Shiva and Crompton (1998) refer to a senior representative of Monsanto who: does not consider technology transfer to be an important factor in the liberalisation of the Indian economy, and does not foresee transfer of Monsanto technology to domestic companies. He says that it was made clear before Monsanto developed its agricultural biotechnology business in India that this would be controlled solely by the multinational and that there would be no agreements for licensing the technology to others (Shiva and Crompton, 1998, p150). As with other developing countries, India will need to have adequate competition regulations to ensure that a small number of TNCs do not block off important areas of research (Watal, 2000, p54) and/or swallow up the domestic firms. And as to whether TNCs will introduce more new varieties to India as soon as PVP becomes available, there is no consensus even among corporate representatives on whether they will do so or not (Shiva and Crompton, 1998, p148). This is a moot point in view of our interest in India’s biodiversity, but it does at least demonstrate that industry itself is sending mixed signals with respect to how it will respond to the introduction of PVP. Rangnekar (2000c) makes several proposals to improve India’s PVP legislation, including the following:
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1 2 3
Revision of the conditions for grant of protection to include an agronomic merit test along with the standard requirements of distinctness, uniformity and stability. Introduction of a system remunerating breeders without providing exclusive rights. Introduction of mandatory declarations of geographical origin, prior informed consent and participation in equitable benefit sharing at the time of application for protection.
Rangnekar also recommends that the public sector maintain its basic research and breeding programmes targeted not only at subsistence farmers and minor crops but also commercial farmers, since this will help to prevent private companies from monopolizing supply and raising prices to unreasonable levels. While proposals 1 and 3 are definitely TRIPS compatible, it is possible that proposal 2 would be deemed to be ‘ineffective’ given its denial of exclusive rights.20 TRIPS is silent with respect to the role of the public sector. But as happened in the US (Dutfield, 2003, p179), the private sector is beginning to oppose competition from the public sector in the production and distribution of new varieties of major crops (Morris et al, 1998; Tripp and Pal, 2001). At some future time it may also oppose public sector breeding. In short, it is possible that PVP will stimulate value addition by expanding the trade in seeds and increasing the total value of agricultural produce derived from them. But this is unlikely to create any incentives for conservation or sustainable use of in situ resources. Moreover, it is possible that millions of resource-poor farmers will be excluded from most of the benefits that may go to their wealthier neighbours. And they will probably be worse off if the state withdraws from crop breeding. Patents, agro-biotechnology and trade What is the link between patents, agro-biotechnology and the objective of adding value to India’s biodiversity? First, Indian firms might seek to develop and commercialize biotechnological processes like those for producing new biopesticides and biofertilizers, and research tools such as biosensors that may be based on enzymes or bacteria found in India. They might then seek to acquire patents and license or sell these to other firms in India or abroad. Here the issue is whether the availability of patents will encourage, facilitate and reward such research and types of transaction, resulting in a greater volume of sales and licence fees. Second, biotechnological applications, including tissue culture and genetic modification techniques (controversial as these are), have the potential both to improve the quality, quantity and price competitiveness of existing food and agricultural products, and to create ‘new’21 products. In this case, agrobiotechnology is used as an input into product development (and perhaps product differentiation) rather than as a product itself. Of course, while the products may be based on India’s own biogenetic resources, these applications
196 National Case Studies may have to be acquired from foreign-owned firms based in India or overseas. Some may also be available from Indian universities and public research institutes where critics argue that many of them are locked up (see Jenny, 1999, p12; Tewari, pers. comm., 2000). In fact, there is a severe lack of both publicprivate sector and inter-company research collaborations and strategic alliances of the kinds common in North America and Europe (Ramani, 1996, p20), and it is important to consider whether IPRs would facilitate the establishment of such collaborations and alliances which can help to create a more conducive climate for both technology acquisition and accelerated learning.22 Taking the first type of linkage, while opportunities for protecting and commercializing biotechnological inventions in India will expand because of TRIPS, restrictions will continue to be much greater than in, say, the US. Nonetheless, the greater availability of process patents and the stronger levels of protection would be a great help for Indian firms seeking to market these technologies in India. The extent to which they could take advantage of patents would in large part depend on their ability to secure adequate funding for their research. But this is a two-way relationship, since it is usually the case that patents attract venture capital and other forms of investment. Would it matter if many of these patent applications came from TNCs doing research in India? If they did, this would imply that TNCs were increasing their investment in research in India due to the existence of a friendlier patent system and were willing to submit themselves to biodiversity legislation requiring them to share benefits with India. This is a hypothetical question given the unclear relationship between IPRs, FDI and decisions on setting up R&D facilities overseas. If TNCs do not respond to the new patent regime, the above question will not arise. But if they do – and the sheer size of the Indian market suggests they are likely to – this will be a good thing for India. Not only will it increase employment for Indian scientists who might otherwise be tempted to emigrate and even encourage Indian scientists based abroad to return to India, but it improves the opportunities for patent-holding domestic firms to engage in strategic alliances with these TNCs. But whether research tools themselves should be patented as products is another question. The likelihood in the short term is that micro-organisms will be defined narrowly and that DNA sequences, cell lines and proteins will not be patentable. Nonetheless, the possibility that research priorities will become skewed in ways that ignore the needs of poorer farmers is a reasonable concern. Public research will therefore need to continue. To sum up, in this sense at least, the easier availability of patents on biotechnological processes, as required by TRIPS, is unlikely to harm India’s efforts to add value to biodiversity and may be highly beneficial. Turning to the second type of linkage, biotechnological applications, these products will not be patentable anyway, since India is not going to allow patents on plants and animals. Therefore, TRIPS will make no difference. The more important issue here is whether TRIPS will improve the availability of these applications for producers, including those that would need to be acquired from abroad, and that would significantly increase sales volumes of products derived from them. The fact that many biotechnological applications are in the public
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domain suggests that TRIPS would make little difference in many cases. But where an application is patent protected abroad and – as a result of TRIPS – the foreign firm is allowed to acquire a counterpart patent in India, then TRIPS will be a hindrance if we assume that an Indian firm could otherwise have used the technology by reading the specification of the original foreign patent. However, it is hard to imagine that a foreign firm would apply for a patent in India and not in another country (such as the US and/or Europe). Our conclusion here does not conflict with the previous one, which was more optimistic. This is because the earlier conclusion was based on only those technologies derived in some way from India’s biogenetic resources and therefore requiring access to India’s biodiversity and then becoming subject to those areas of regulation likely to come into force in the near future. Here we refer to any biotechnology of use to domestic firms. Once again, it is important to understand that so many potentially useful biotechnological applications are in the public domain, and India has the capability not only to use them but also to adapt and improve upon them. Geographical indications, trade marks and trade At the end of 1999, the Indian Parliament passed legislation on both trade marks and GIs. The former provides for two types of trade mark not actually mentioned in TRIPS:23 collective marks and certification trade marks. Both kinds of trade mark could potentially serve as extremely useful marketing tools for firms and producer associations trading in natural products such as foodstuffs, beverages and herbal remedies. But we will not discuss them further, since TRIPS neither requires nor prevents India from introducing such trade mark categories. With respect to GIs, WTO members are required by virtue of TRIPS Article 22.2 to provide the legal means for interested parties to prevent: (a) the use of any means in the designation or presentation of a good that indicates or suggests that the good in question originates in a geographical area other than the true place of origin in a manner which misleads the public as to the geographical origin of the good; [and] (b) any use which constitutes an act of unfair competition. The Indian government provided these legal means in the form of legislation known as the Geographical Indications of Goods (Registrations and Protection) Act, 1999. Compared to the patent and PVP bills, the drafting and passage of this legislation was uncontroversial. This is mostly because it was considered essential to defend overseas markets, for products like basmati rice, from foreign companies using the same name for their own goods. In fact, the new law was a response to the behaviour of the US company RiceTec, which sells what it calls ‘Long grain American basmati’, has trade marked the word ‘Texmati’, and in 1998 received a US patent for ‘Basmati Lines and Grains’. Even some of the harshest critics of TRIPS feel that this section of the agreement can provide solid gains for India (eg Sahai, 1998). Are they right to think so?
198 National Case Studies It does not appear that Indian traders use the GIs of foreign producers in marketing their own products to any significant extent. Therefore, this section of TRIPS creates possibilities for India that might not otherwise exist and without imposing any new restrictions on the current practices of domestic producers and exporters. The new law may encourage Indian producers and exporters to differentiate their goods in domestic and foreign markets and help them to benefit commercially from doing so. In addition, the law provides greater opportunities for enforcing GIs in foreign courts. This is because while all WTO members must provide legal means for the protection of GIs, they are not required to provide such means with respect to GIs that are not protected in their country of origin. It seems, then, that this section of TRIPS can provide rewards and incentives for efforts to add value to India’s biogenetic resources. In fact, GIs are quite appropriate for many goods that, in India, tend to be manufactured by small-scale producers and cultivators. Among the high-value products that could be protected as GIs are the following: Darjeeling tea, Assam tea, and basmati rice (or local varieties of basmati having their own designations such as Lalkilah and Red Fort (Owen, 1993)).
The health sector Pharmaceuticals Despite external pressure to introduce product patents on pharmaceuticals before 2005, the Indian government seems determined to take full advantage of the transition period by complying as late as possible. This appears to be due to the strength of domestic opposition. Nevertheless, some of the larger Indian firms have become much less anti-TRIPS than before. This is evidently a consequence of their belief that the period from 1972 (when the Patents Act came into effect) to 2005 is a long enough transitional period to prepare them for the new regime. In fact, some of them (eg Ranbaxy) now see it more as an opportunity than a threat. After all, the experience of pharmaceutical companies in other countries is that, as the cost of developing new drugs increases, patent protection becomes extremely important. But this view is by no means shared by the smaller firms, many of which are likely to go out of business or be forced to merge once trade barriers are further eroded and the new patent regime takes effect. Before going further, we need to consider whether the expected emergence of a large research-based pharmaceutical sector that holds patents and respects the patent rights of rival firms is actually good for India. While in some ways it is, there is a real conflict between the ‘good’ of value addition and the ‘good’ of affordable medicines. Perhaps the economic and welfare interests of the Indian people would best be served through a domestic pharmaceutical industry that can achieve large profit margins in countries where drugs can be sold at a higher price, while strict price controls would remain in force in India. In summary, the most significant effects of the forthcoming patent regime are likely to be:
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1
2
3
A restructuring of the Indian pharmaceutical industry resulting in fewer firms, of which a small number will increase their market share and collectively dominate the domestic market, albeit with increased competition from TNCs. A deterrent to process innovation. This will be detrimental to many firms, including those beginning to invest in in-house R&D. Product patents are broad in the sense that they protect the product whatever the process employed to make the product. Product patent regimes do not encourage other firms to develop more efficient or cost-effective processes to make existing products as compared with regimes allowing only process or product-by-process patents. Since some Indian drug firms are competent at process innovation while fewer have achieved competence at product innovation, the overall result is likely to be to stifle the kind of innovation that many Indian scientists are good at. An increase in FDI but a decrease in access to those foreign technologies whose adoption could otherwise be achieved by reading patent specifications. Again this will be detrimental to domestic firms but not entirely. What is the evidence for this? The introduction of stronger patent laws in some other developing countries, such as Nigeria, Chile and Mexico led to a fall in FDI and a rise in drug imports (EXIM Bank, 1997b, p23). But given that India had the weakest patent regime of all these countries and that it is the biggest developing-country producer of pharmaceutical products, it cannot be assumed that India will have the same experience. In fact, India’s huge market potential, and its advanced pharmaceutical S&T capacity, achieved with the help of the long period of product patent nonavailability, suggests that TNCs may increasingly find it worthwhile to invest in India, including by setting up R&D facilities. But this does not mean they will be willing to share their technologies with domestic firms through licensing or joint ventures. In fact the size of the Indian market and the emergence of large, increasingly research-based domestic firms, suggests they may be quite unwilling to do so except on extremely demanding terms.
What about patents and natural product research? As was explained earlier, for Indian pharmaceutical companies interested in producing new drugs through their own research, natural product research tends not to be their primary approach to drug discovery. Will product patents make any difference to this situation by encouraging greater investment in the discovery of therapeutic compounds in nature? Given the wealth of biodiversity at the disposal of Indian industry that will be much less accessible to foreign firms when the new biodiversity regime comes into effect, it is highly plausible that most patents for therapeutic products and processes based on or derived from India’s biogenetic resources will be held by Indians. Holding such patents should encourage such firms to invest in natural product R&D. But this does not mean there will be a large number of such patents. First, the bureaucratic structure that the forthcoming biodiversity regime will set up might discourage bioprospecting (although it would favour domestic
200 National Case Studies firms over TNCs). Second, it remains unclear to what extent companies discovering therapeutic compounds in nature will be able to acquire effective patent protection given the ambivalence towards patenting life in India. But in the long run, the most important argument for scepticism that companies will benefit from such patents is the scarcity of new drugs being developed from natural sources elsewhere in the world. It is extremely doubtful that any significant quantity of new pharmaceuticals will result from bioprospecting expeditions in any one country, including India. And it is only if such an outlook is proved wrong (which is very unlikely) that there is any possibility of bioprospecting by the pharmaceutical industry creating any incentives for conservation or sustainable extraction of biogenetic resources. Traditional and herbal formulations The situation with respect to traditional and herbal formulations is much more promising than that of pharmaceuticals, because this is a rapidly expanding industrial sector, and India’s modern and traditional science and technology (S&T) capacities in this area are very strong. As a result, and also because the forthcoming biodiversity regulations will restrict TNC access to India’s biogenetic resources, Indian firms are likely to acquire large portfolios of patents of such products with much less competition from TNCs than in the pharmaceuticals case, so long as the access regulations are not overly restrictive or bureaucratic. Of course concerns about anticommons situations arising and misappropriation of TK could prove to be well founded. With respect to the latter concern, India is fortunate to have a well-established and vigilant NGO sector that exposes and condemns abuses. These NGOs may well prove to be effective in deterring such acts. One very important condition for success is how Indian companies will deal with the traditional communities. While benefit sharing should not be a consideration in the case of Ayurvedic and other classical formulations prescribed in the ancient texts, the commercial use of local adaptations of such formulations and other traditional remedies should be subject to the prior informed consent (PIC) of the communities and healers involved and formal benefit-sharing arrangements. This would help to build trust between communities and companies of a kind that has barely previously existed, encouraging traditional healers to disclose their knowledge to companies, and resulting in a wider range of commercial products. IPR protection should not be used to exploit healers and communities. The filing of patents for herbal formulations that are essentially identical to those of local healers will lead to an adversarial relationship between companies and communities that would be detrimental to the interests of both. Ideally, applicants should be required to provide evidence of benefitsharing arrangements, and – where appropriate – to share patent ownership and/or name healers as co-inventors. In this way, IPR protection could be used as a means of helping to ensure that local collaborators receive a fair return, thereby encouraging the discovery and development of more commercial products and encouraging conservation and sustainable harvesting.
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An interesting recent development is the decision of the government to compile a Traditional Knowledge Digital Library (TKDL), an initial draft of which is being prepared by the Department of Indian Systems of Medicine and Health and the National Informatics Centre. The idea is to compile a public database of ancient and modern texts on TK in India to provide evidence of prior art so as to prevent the fraudulent patenting of ‘inventions’ that are essentially identical to public domain TK (Somasekhar, 2000). The TKDL would be made available to patent examiners and could be used as evidence where patents are being opposed on the grounds that they have misappropriated TK. This is a long-term commitment given the huge volume of published information, and it is far from certain that patent-related biopiracy is so common that such a commitment in time and resources can be justified. But, once complete, it might help to build trust and a more constructive relationship between TK-holders and their communities, NGOs and the private sector.
CONCLUSIONS In the pre-TRIPS era, India designed its patent system in accordance with its development priorities. In large measure this system was a successful one. The new regime, which is supposed to be fully implemented in 2005, allows India – as with other developing countries – much less freedom to tailor the system to fit its perceived national interest. Nonetheless, the IPR and biodiversity management laws that the government has drafted and enacted are serious attempts to reconcile the country’s international commitments with its concerns about access to genetic resources, sustainable use, and equitable benefit sharing. To the extent that such laws are TRIPS-compatible, which they largely appear to be, the global IPR regime does allow a significant measure of flexibility. But many developing countries may encounter external pressure that inhibits them from taking full advantage of this. India’s ability to resist such pressure is relatively strong given its importance as an emerging economic power with a huge domestic market. Furthermore, successive governments have faced very strong parliamentary and extra-parliamentary criticisms whenever they have sought to introduce legal instruments to implement the patent and PVP-related provisions of TRIPS, ensuring that the TRIPS implementation process is very slow. So is the overall effect of the global IPR regime an allocation of rewards and incentives that will hinder or help India to add value to its biogenetic resources while encouraging conservation and the sustainable use of biodiversity? If we consider first the case of PVP, it seems likely that while such a system will encourage crop breeding for commercial agriculture, the interests of small farmers will be disregarded, and research will focus mainly on the major crops and on a fairly narrow pool of germplasm. It is unlikely that a small number of TNCs will dominate the industry in the near future, but the possibility of this happening within the next 10–20 years should not be discounted either. While
202 National Case Studies total agricultural productivity may increase, at least in the short term, and this may be reflected in the trade indices, the system is likely to accelerate the monoculturization of Indian agriculture to the detriment of the county’s biodiversity. It is absolutely essential that the public sector continues to carry out research oriented towards the interests of the poorer farmers, including the crop species that they cultivate, most of which are native to India. In short, PVP is likely to help India add value to its biogenetic resources but this will almost certainly be detrimental to local efforts to conserve and sustainably use the resource base in all its diversity, and may well have adverse distributional implications. Turning to patents, the prognosis is promising for biotechnology products and processes – as long as the system is designed with care. This is because of the tremendous importance of patents for protecting investments in such research, for attracting further investment from outside, and in developing strategic partnerships with other firms. As a country that has achieved impressive advances in biotechnology and with a huge natural resource base, India may now be ready for a patent regime allowing for the protection of biotechnological inventions. And because of the exceptions that TRIPS allows, such as plants and animals, India can, and definitely should, take a step-by-step approach to expanding its patent system, starting with micro-organisms. Of course there is a danger of process innovation being blocked by TNCs aggressively taking out product patents in huge volumes. Probably the best response is for India to introduce a competition regime to ensure that no single firms or corporate networks exploit their patent portfolios to dominate the agro- and health biotechnology markets. Turning to traditional knowledge and technologies, the most promising types of good for increased commercialization are probably Ayurvedic and herbal health products for domestic and international markets, and those highvalue food products and beverages that either have established markets abroad or have genuine potential subject to their achievement of international standards of production and packaging, and good marketing. Patenting activity among such firms may well increase. Unfortunately, IPR protection is hardly available for holders of TK. Without such protection, the incentive for these individuals and groups to share their knowledge is very limited and may well decrease as they become aware of the extent to which companies can profit from their knowledge. While companies producing and marketing such products may well file more patents than pharmaceutical companies discovering natural therapeutic compounds, the industry is not as dependent for its existence on patents as the seed industry is on PVP (and of course hybrids). Evidently, the international patent regime provides little incentive to add value to India’s biogenetic resources, but it is certainly not a disincentive either. As for conservation, again, commercial use is more likely to accelerate degradation of biodiversity. However, when it comes to GIs, there seem to be only advantages. It does not appear that any Indian businesses will be prevented from manufacturing goods it already produces, while the commercial possibilities for traders in at
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least some well-known high-quality goods are definitely enhanced, both abroad and in India (given its large middle class in absolute numbers). Geographical indications have the potential to encourage the continued use of traditional crop varieties and the application of local skills and technologies. The problem is that, as with so many related legal and policy initiatives in India, the decision to introduce this system was not motivated by the priority of sustainable development but by a determination to prevent (or be seen to be trying to prevent) others from ‘pirating’ India’s resources and TK. This highlights the importance of developing a coordinated sustainable development programme of which IPRs and biodiversity management regulations should be treated as major components, rather than to bring in regulations in reaction to exploitative behaviour by foreigners. In conclusion, TRIPS will have both positive and negative consequences. One likely positive consequence is an increase in the sales volume of natural product exports, many of which will be derived from biogenetic resources of Indian origin. More pessimistically, the range of such exports will probably narrow rather than expand. Moreover, increased trade revenues may do little to benefit the majority of Indians who are poor, live in rural areas, and depend on a diversity of local species for food, health security and for subsistence. Furthermore, the new regime will likely do nothing to encourage conservation and the sustainable use of biodiversity.
Chapter 15 KENYA
INTRODUCTION Like India, Kenya is a country with a low per capita income that is a large exporter of natural products, including those which benefit the economy because they have a high value in international markets and some which do not substantially benefit the economy in spite of the high market value of products derived from them. However, like most African countries, Kenya has limited industrial development and scientific capacity and is a member of the so-called Weak South. Nonetheless, the country has a patent law that is somewhat closer to TRIPS compatibility than that of India. It has also had plant variety protection (PVP) regulations since 1972, and has been a member of Union Internationale pour la Protection des Obtentions Végétales (UPOV) since 1999. Therefore, the situation is quite different to India, which built up its not inconsiderable S&T capacity in the absence of a patent system providing broad protection of life-science-based inventions, and the complete absence of a PVP system.
BIODIVERSITY: CONSERVATION, TRADE AND DEVELOPMENT
The state of Kenya’s biodiversity Kenya is not as biodiversity-rich as India, but is otherwise extremely wellendowed. The country is positioned at the meeting place of four important zones of plant species diversity: the Guineo-Congolian; the ZanzibarInhambane Mosaic; the Somali-Maasai Region; and the Afro-Montane Region (Ministry of Environmental Conservation, 1998, p8). According to Kenya’s Ministry of Environmental Conservation (1998, p17), Kenya is ‘the most species dense country in Africa’. Kenya is estimated to have a total of 34,863 species, of which 1,841 are micro-organisms, 6,817 are plants, and 25,375 are animals. But future scientific investigation is likely to
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reveal a great many more species of micro-organisms and insects. Kenya has a wealth of non-domesticated varieties of crop species and relatives including cereals, pulses, tubers, oil crops, fruit trees and vegetables, and other plant species with commercial and industrial potential (Ministry of Environmental Conservation, 1998, p17). Drought-resistant wild relatives of coffee are also believed to exist in isolated areas (Ministry of Environmental Conservation, 1998, p17). It is estimated that 392 higher plant species are endemic to Kenya, and 336 more are endemic to this part of Africa (Ministry of Environmental Conservation, 1998, p9). While the most biodiversity-rich areas are the forests, it is in the arid and semi-arid lands covering 80 per cent of the national territory that most of Kenya’s world-famous megafauna can be found. Human activities throughout the country are causing the erosion of species and intra-species diversity. These activities include changes in land use such as converting forests into croplands and unsustainable levels of resource extraction. The underlying cause appears to be Kenya’s extremely high population growth rate and resulting migrations to fragile environments. Between the 1940s and 1986, Kenya’s wildlife habitat decreased by almost a half (Ogolla and Mugabe, 1996, p93). At least 258 species are known to be threatened and six species have become extinct (Ministry of Environmental Conservation, 1998, p9), while intra-species crop genetic diversity is being lost for similar reasons as elsewhere in the world. In addition, 15 per cent of bird species are endangered (Ogolla and Mugabe, 1996, p93).
Kenya’s development priorities and the biotrade This section considers how Kenya’s biogenetic resources currently benefit the populace, and how adding value to these and other resources could provide greater benefits. Since the situation of Kenya’s biotrade-related development priorities is broadly similar to that in India, this section is quite brief. As with India, Kenyans living in rural areas following traditional lifestyles are highly dependent on local resources for their own consumption and for trade. In addition to the use of landraces in small-scale agricultural systems, many rural Kenyans gather and trade forest products such as medicinal plants, gums and resins (Mogaka, 2000) Food security is extremely important throughout Kenya, but especially for the 14 per cent of the population who inhabit the arid and semi-arid lands. This is true for both cultivators and pastoralists, who may find it necessary to diversify their subsistence activities by utilizing a wider range of species and gathering natural products that they can sell in local markets. For example, during periods of drought, they are likely to depend on minor crops and wild plants, which may be valuable sources of essential nutrients (Onyango, 2000). As in most developing countries, poor rural and urban populations depend on traditional remedies rather than modern pharmaceuticals. Herbalists play a vital role in primary healthcare throughout the country. And as with India, science-based industrial use of Kenya’s biodiversity should benefit the national economy not only because of the potentially huge
206 National Case Studies augmentation to the value of the resources, much of which can then be captured by Kenya itself, but also because it generates demand for skilled and highly trained personnel who might otherwise trade their knowledge and skills abroad. In short, such an approach promises to take better advantage of some of Kenya’s most valuable – and scarce – human resources.
Kenya’s trade in natural products Kenya depends heavily on trade in natural products, especially tea, coffee and horticultural produce including vegetables and cut flowers (Table 15.1). After tourism, tea is the second biggest source of foreign exchange. These products are extremely important, not just because they provide foreign exchange but also as sources of employment and income for rural people. Each type of product is grown not just by large land and estate owners but by smallholders. The international biotrade, therefore, does not just benefit the wealthy landowners. However, most crops cultivated for export markets are not native to Kenya but were introduced during or since the colonial period (from the 1880s–1963).1 For example, coffee cultivation was begun in 1894 by a British planter who had brought seeds from Aden (Juma, 1989, p41). Tea was introduced to Kenya in 1903 (Ali, Choudhry and Lister 1997, p37). Some of the most widely grown types of maize, the most important Kenyan staple food, were introduced at about the same time (Juma, 1989, p182). Juma (1989, p180) notes that ‘from the early days of the evolution of Kenya’s modern agriculture, there was a preference for exotic crops’. This is quite different from India, which has built up its agricultural export trade on a mix of exotics and indigenous crops and those that have become naturalized and then diversified since their original introduction to the country. Furthermore, the introduction and expansion in the cultivation of these crops has often required the clearance of biodiversity-rich forests and the replacement of landraces (Markandya et al, 1999, p89; also see Wallis, 1997, p131). Therefore, in a sense the expanded trade in natural products has been at the expense of Kenya’s biodiversity. Also, certain crops like coffee, tomatoes and cut flowers, require heavy doses of agrochemicals which can damage the environment. As for medicinal plants and herbal health products, unlike India but in common with most African countries, Kenya is not a significant exporter. In short, Kenya is not a large exporter – or even domestic producer – of natural products consisting of or based upon indigenous biological resources. But this does not mean that it will not be in the future given the diversity of species that exist. Most of the genetic resources held in collections have not been characterized, meaning that their potential is completely unknown (Wambugu, pers. comm., 2000). The question that arises, and which I will need to answer in this chapter, is: will IPRs encourage plant breeding and scientific/industrial research on minor crops and species that are native to Kenya?
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Table 15.1 Percentage contribution of major agricultural products and manufactured goods to Kenya’s total export value, 1990 and 1995 2
1990 1995
Tea
Coffee
25.5 19.3
17.9 15.5
Horticulture Manufactured goods 13.0 11.4
16.8 32.3*
Others 26.8 21.5
* 1994 figure
The national system of conservation As with India, several laws and state entities exist to deal with the various aspects of biodiversity management. This section describes some of the key institutional elements of Kenya’s national system of conservation. The key agency conducting scientific research aimed at conserving Kenya’s biodiversity is the National Museums of Kenya (NMK).3 The NMK’s Centre for Biodiversity coordinates all biodiversity conservation-related research activities conducted both at the NMK and at other agencies. In addition, the NMK’s Department of Molecular Genetics is charged with ‘assessing the extent of genetic variability existing in wild populations of plants and animals that are rare, threatened or endangered or of economic, medical or social importance’.4 The herbarium, which contains 700,000 specimens, has a Plant Conservation and Propagation Unit devoted to the conservation of threatened and endemic flora. The NMK also acts as the secretariat for the Plant Genetic Resources Working Group (PGRWG), which brings together all the main agencies involved with the research, management and conservation of plant genetic resources. In addition to the NMK, these are the Kenya Agricultural Research Institute (KARI), the Kenya Forestry Research Institute (KEFRI), the Forest Department, and the Kenya Wildlife Service (KWS). The mission of the PGRWP is ‘to ensure, in partnership, effective conservation of the country’s PGR and their utilization for sustainable development.’ The PGRWG urged the government to domesticate the Convention on Biological Diversity (CBD) by developing access and benefit sharing (ABS) regulations. These were subsequently drafted by a task force comprising individuals from the above agencies and others including the University of Nairobi, the African Centre for Technology Studies, and the Access and Benefit Sharing Expert Working Group (an initiative led by the National Council for Science and Technology). According to these regulations, which are not yet in force, a new governmental organization would act as the lead implementation agency. This agency, the National Environment Management Authority (NEMA), was supposed to have been set up by the Environmental Management and Coordination Act (passed in January 2000). However, the situation is extremely unclear, since the NEMA still does not exist, and neither the PGRWG nor the ABS Expert Working Group are functioning effectively at present (Lettington, pers. comm., 2000).
208 National Case Studies Two important components of Kenya’s national conservation system are the Gene Bank of Kenya (GBK) and the KWS. The GBK is the largest germplasm repository in the country. About 80 per cent of its accessions are forage crops while the remaining 20 per cent are food crops (Mugabe, Marekia and Mukii, 1998, p111). The GBK focuses on such crops because of their importance for agricultural research. It has been criticized for neglecting Kenya’s many non-domesticated species which, it is alleged, the GBK assumes to have limited agricultural value and therefore that their conservation is less necessary (Mugabe, Marekia and Mukii, 1998, p112). The KWS is the main agency responsible for in situ conservation and sustainable utilization of Kenya’s flora and fauna, implementing the Wildlife (Conservation and Management) Act of 1976 (amended in 1989). The act provides for a system of national parks and reserves that cover 7.65 per cent of the country (Eriksen, Ouko and Marekia, 1996, p200). The main difference between national parks and national reserves is that while the former severely restricts land use other than for wildlife conservation, the latter may allow other land uses, albeit with restrictions (Eriksen, Ouko and Marekia, 1996, p205). Kenya’s protected area system reflects the so-called ‘guns and guards’ approach to conservation that is increasingly discredited for failing to accommodate the rights and interests of local people, and for seeking to maintain pristine wildernesses in spite of massive population pressure in adjacent areas (Mugabe, Marekia and Mukii, 1998, pp99–100).
KENYA’S SCIENTIFIC AND TECHNOLOGICAL CAPACITIES: AN ASSESSMENT Western/industrial science and technology capacities In common with most developing countries, Kenya invests very little in R&D, and almost all of it is conducted by the public sector. In 1991–1992, total expenditure amounted to 0.75 per cent of GDP5 with 90 per cent of this funded by the government. Most funding is allocated to agricultural research; medical research comes second, followed by forestry and then marine and fisheries research. Industrial research is the most poorly funded area of government research (Government of Kenya, 1996, p176). Food and agriculture The Kenya Agricultural Research Institute is the administrative and institutional focal point of Kenya’s national agricultural research system (Mugabe, Marekia and Mukii, 1998). The Institute is responsible for agricultural research, including conventional crop breeding and biotechnology, and also for ex situ conservation of genetic resources. The institute’s orientation is towards food security, productivity and the needs of small farmers. Other parastatal agencies set up under a 1979 amendment to the 1977 Science and Technology Act to conduct research in specific life-science areas include KEFRI, the Kenya
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Medical Research Institute (KEMRI), and the Kenya Marine and Fisheries Research Institute (KEMFRI). The breeding work undertaken by KARI focuses on cereals, legumes, oils crops, horticultural crops and tree fruits (Ngugi and Mugo, 2000, p156). Material for breeding is aimed both at crossing parental lines to identify progenies with useful traits and at adapting exotic germplasm acquired from the International Agricultural Research Centres (IARCs) such as by crossing with local germplasm (Ngugi and Mugo, 2000, p156). Apart from KARI, organizations carrying out agro-biotechnology research include the Moi University, University of Nairobi, Jomo Kenyatta University of Agriculture and Technology, the NMK, the Coffee Research Foundation, the Tea Research Foundation, the Pyrethrum Board of Kenya, and the international research institutions based in Kenya such as the International Centre for Research in Insect Physiology and Ecology (ICIPE), and the International Centre for Agroforestry (Anyango and Shiundu, 1999, pp4–5; Emerton and Maganya, 2000, p36; Makau and Kameri-Mbote, 1995, p110). Research projects underway in Kenya include the following (Emerton and Maganya, 2000, p35): • • • • • • • • • •
development of Bt-based biopesticides for crop pests integrated management; genetic analysis of bean rhizobium; development of rhizobia-based biofertilizer innoculants; tissue culture of citrus and banana for production of disease-free seedlings; tissue culture for supply of disease-free planting materials for various plants including, sweet potatoes, Irish potatoes, ornamental flowers, banana, macadamia and pyrethrum; crop improvement through molecular market research; molecular marker research technology focusing on the development of Kenya maize varieties against stem borer pests and drought tolerance; crop improvement through transformation of sweet potato feathery mottle virus; transformation and regeneration of a transgenic sweet potato that is resistant to feathery mottle virus; tissue culture for rare flora species such as orchids.
Health As with agriculture, most research is carried out by the public sector. The lead agency is KEMRI, whose main focus is biomedical research. Specific areas include the following: AIDS and other sexually transmitted diseases; nutrition disorders; dental health; traditional medicines and drugs; and leprosy.6 Most of these programmes are applied research for the benefit of rural communities. Africa Online7 lists the following achievements of KEMRI: • •
the establishment of drug resistance testing in malaria; the identification of a dengue epidemic in 1982;
210 National Case Studies • • • • •
the establishment of systems to diagnose such viral diseases as marburg and haemorrhagic fevers; the development of short treatment regimens for tuberculosis; developing rapport with traditional doctors, thus opening the way for scientific investigations of traditional medicines; setting up tissue typing in support of kidney transplantation programmes; the establishment of parasite banks and techniques for characterizing leishmanial parasites.
Other institutions involved in biomedical research include the Kenya Trypanosomiasis Institute (KETRI) and the University of Nairobi. However, the private sector is at a much lower stage of development than in India. It does not appear that any domestic firms are ready to become research-based pharmaceutical companies. Although generic drugs are manufactured in Kenya, the country – unlike India – is a net importer of pharmaceuticals. In fact, Kenya is one of India’s export markets.
Traditional knowledge and technologies Although Kenya is not as culturally diverse as India, in large expanses of the country cultural communities follow traditional lifestyles that have changed little, at least until recent times. Since so much of Kenya’s land surface is arid and semi-arid, intimate knowledge of the natural environment is essential for survival. Groups like the Turkana of north-western Kenya, for example, have a highly sophisticated natural resource management system that has enabled them to survive in an environment that many would consider to be extremely hostile. According to Barrow (1996): The people of Turkana have evolved well-managed and sound ecological strategies which enable them to utilize the vegetation on a sustainable basis. They exploit different ecological niches by having grazing livestock (cattle, sheep and donkeys) and browsing livestock (camels and goats) and diversified food procurement strategies (Barrow, 1996, p266). Barrow also emphasizes their ‘well-developed knowledge of their flora and its uses’ and goes on to explain how the Turkana take advantage of the full diversity of woody species to meet their many subsistence needs through their use as sources of food, fuel, building materials, and human and veterinary medicines. In spite of urbanization, traditional systems of health are still practised throughout the country. Traditional herbalists are active in both rural and urban areas. In order to be officially certified, herbalists are required not only to register with the Ministry of Culture, but also to provide KEMRI’s Centre for Traditional Medicine and Drug Research with samples of all plants used including full information on each plant such as the part used, the method of preparation, and the dosage (Chege, 1997, p14). In return, herbalists are given some general scientific information on each sample such as whether prescribed
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dosages are safe and whether or not it contains ingredients with genuinely therapeutic effects (Chege, 1997, p14). Although KEMRI is mainly interested in ensuring that safe standardized herbal treatments are available for rural communities rather than in pharmaceutical development, collaborative work with KEMRI’s Centre for Virus Research has resulted so far in ten plant extracts showing activity against HIV in vitro (Rukunga [of KEMRI], in GIFTS of Health, 2000).
Where do Kenya’s competitive advantages lie? The sustained success Kenya has enjoyed in exporting natural products like tea and coffee and, in recent years vegetables and cut flowers, suggests that the country’s competitive advantages lie in producing exotic natural products for overseas markets. With the exception of pyrethrum, no native species or natural products exist which form the basis of a lucrative export business. While it may be possible to identify natural products that are endemic to Kenya or at least to East Africa, and that might be exported profitably, such as herbal medicines, fruits or cosmetics, such products will at best be few in number. Compared to India, Kenya has other disadvantages with respect to trading profitably in its own biodiversity. First, given India’s huge population and established classical health traditions, it is hardly surprising that a herbal health product sector has developed to satisfy their huge domestic demand for such remedies, nor that some of these firms have reached a level of development sufficient for them to seriously contemplate exporting to Europe, Japan and North America. Second, there are millions of people outside India who are either non-resident Indians or who have Indian ancestry and are likely to be familiar with such goods and to want to purchase them. None of these advantages exist for Kenya. In addition, while the Kenyan economy continues to benefit to the current extent from these exotic crops, the incentive is to expand production of them even when this means opening up biodiversity-rich forest lands to cultivation (and perhaps even expelling the populations who use these lands for their subsistence needs) if increased productivity cannot be achieved on the farms and plantations where cultivation is currently taking place. Whatever the relationships may be between demand trends and changes in the land area devoted to cultivation, the very fact that land is being used to cultivate exotic species for export that might otherwise be utilized less intensively hardly leads one to the conclusion that the trade–biodiversity connection is a mutually supportive one. But it would be wrong to conclude that smallholder farmers cannot benefit. In fact, smallholders produce a great deal of Kenya’s coffee, tea and horticultural output for both domestic and foreign markets. So biodiversity’s loss could still be a gain for many poor farmers. This is a rather depressing outcome for nature-lovers, but not necessarily for many poor Kenyans whose land is their only source of income generation.
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IMPLEMENTING TRIPS: CURRENT PROGRESS Until 1989, Kenya’s patent system was essentially an extension of that of the UK. Patent applications were examined in the UK. Only after they had been issued there could registration of the rights be applied for in Kenya. Rights and obligations were defined in conformity with the UK Patent Act of 1949, and patents remained in force and expired in Kenya according to their status in the UK (Chege, 1997, pp4–5). Provision for the public disclosure of patent specifications was completely inadequate (Juma, 1989, p230). This situation was obviously unsatisfactory for a sovereign nation and so, in 1989, the government passed a law intended ‘to provide for the promotion of inventive and innovative activity and to facilitate the acquisition of technology through the grant and regulation of patents, utility models, rationalization models and industrial designs and for connected purposes.’8,9 While the Industrial Property Act was not TRIPS-compatible, it was considerably more consistent with TRIPS than was India’s Patents Act prior to 2002, suggesting that there is less ideological opposition to intellectual property than there is in India (or perhaps people are simply less informed). This is borne out by the fact that Kenya has been a party to the Paris Convention since 1965 and to the Patent Cooperation Treaty since 1994, has had a PVP law in place since 1972, and was a founder member of the African Regional Industrial Property Organization (ARIPO). The Industrial Property Act established a new institution called the Kenya Industrial Property Office (KIPO) whose functions were to: examine applications for, and grant, industrial property rights; screen technology transfer agreements and licences; provide patent information to the public; and promote inventiveness in Kenya. The extent of what may be considered to be an invention is far more expansive than in India. Only the following are not considered patentable: • • •
plant varieties as provided for in the Seeds and Plant Varieties Act, but not parts thereof or products of biotechnology processes; inventions contrary to public order, morality, public health and safety, principles of humanity, and environmental conservation; any other inventions that may be declared non-patentable by the Minister responsible for supervision of the Office. (This could of course be construed quite broadly.)
In addition the following are considered not to be inventions for the purposes of the Act: •
discoveries or findings that are products or processes of nature where mankind has not participated in their creation (including animals, plants and micro-organisms) and scientific and mathematical methods and theories;
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• • •
schemes, rules or methods for doing business, performing purely mental acts or playing games, and computer programs; methods for treatment of the human or animal body by surgery or therapy, as well as diagnostic methods; except products, in particular substances or compositions, for use in any of those methods; or mere presentation of information.10
Otherwise, no fields of technology or industrial sectors are explicitly excluded from the patent system. The Act provides quite generous scope for the patenting of biotechnological inventions compared to many developing countries, including India. With respect to the patenting of life-forms, it provides guidance to applicants for fulfilling disclosure requirements only in respect of microorganisms, and not plants and animals. But there is no reason to suppose the latter are not patentable. ‘Self-replicable matter’ defined as ‘matter possessing the genetic material necessary to direct its replication by way of a host organism or in any other indirect way’ is patentable. The initial term of protection is seven years from the date of filing but the duration can be extended by up to two additional five-year periods. Patent holders are obliged to work their patents in Kenya. But the only sanction is that extensions to the term of non-worked patents will only be granted if there are legitimate reasons for failure to work. Inadequate working is also grounds for allowing compulsory licences to be granted. ‘Working a patent’ is defined in a way that may place quite substantial obligations on holders: The invention is worked if the protected product is permanently or regularly used in the manufacture of the product covered by the protection in order to market the product under reasonable commercial and market conditions, either directly or by the patentee or his successor in title or licensee, in quantities that amount to effective industrial exploitation under satisfactory conditions as to quantity and price. All licence contracts have to be submitted to KIPO for registration and approval. The Act also provides for utility models. As was mentioned earlier, these may include ‘micro-organisms or other self-replicable material, herbal as well as nutritional formulations which give new effects’ (emphasis added). Since the law came into effect in 1990, there have been about 300 local IPR applications under the Act, but these have mainly been for industrial designs (Olembo [KIPO], pers. comm., 2000). There have been no local applications at all for utility models on herbal or nutritional formulations. In fact, very few Kenyan residents have been granted patents to date (see Chapter 8).
Seeds and Plant Varieties Act (1972, revised in 1977 and 1991) Kenya became one of the first developing countries to have PVP legislation when it passed the Seeds and Plant Varieties Act, which entered into force in 1975. There was little demand from domestic breeders for such legislation,
214 National Case Studies which suggests that external pressure, mainly from foreign firms whose horticultural varieties were being planted in the country, played a large role in persuading policy-makers of the need for such a law. The Act, which is largely modelled on the UPOV Convention (and on the counterpart UK legislation (Chirchir, 1997, p10; Sikinyi, pers. comm., 2000)), required protected varieties to be sufficiently distinguishable; sufficiently varietal pure; sufficiently uniform or homogenous; and stable in their essential characteristics. In addition to these requirements, ‘the agro-ecological value [of the variety] must surpass, in one or more characteristics, that of existing varieties according to results obtained in official tests.’ However, the PVP section of the Act could not be implemented until the 1990s when the Seeds and Plant Varieties (Plant Breeders’ Rights) Regulations were passed (in 1994), and the Plant Breeders’ Rights Office was established (in March 1997). Nonetheless, the contention by the Office of the US Trade Representative (2000a, p251) that Kenya’s PVP ‘laws do not conform to international regulations’ was simply false given that Kenya had amended its rules as a condition for UPOV membership some time before the USTR report was published. With respect to patents, it might be argued that the definition of working, insofar as it requires local manufacture, conflicts with Article 27 of TRIPS, according to which ‘patents shall be available and patent rights enjoyable without discrimination as to the place of invention, the field of technology and whether products are imported or locally produced’ (emphasis added). Otherwise, the main problem with the Industrial Property Act is that the maximum patent duration is less than 20 years. In 2001, the government enacted the Industrial Property Act, 2001. Among other things, the Act extends the patent term to 20 years and removes the obligation to work patents in Kenya. There is still some reference to working patents in the section on compulsory licensing, but the implicit meaning (ie supplying a market on reasonable terms in Kenya) appears to include importation.
TRIPS, UPOV AND THE NATIONAL BIO-INDUSTRIES: THREAT OR OPPORTUNITY? There has never been anything more than minimal domestic demand for patents and PVP among those most likely to be users (ie public and private sector inventors and plant breeders). This, and the country’s generally weak S&T capacity, suggest it is doubtful that there will be many Kenyan applicants for patents and PVP rights in the foreseeable future. This, in turn, suggests that the national bio-industries have nothing to gain from the global IPR regime. This part of the chapter seeks to determine whether such a pessimistic conclusion is justified.
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The food and agricultural sector Plant variety protection, value addition and trade Given that Kenya’s commercial agricultural systems are based mostly on exotic crop species, adding value to the country’s indigenous crop species would require a fairly radical reorientation of crop selection away from horticultural species in demand in developed-country markets, especially Europe. While it is important to keep native food crops in cultivation for the sake of the many Kenyans who depend upon them for survival, such a reorientation would result in a huge drop in foreign exchange receipts. But could PVP still play some useful role in encouraging breeding that would result in a wider range of commercial crop species, including more native species? And if so, might this encourage conservation and sustainable use of the latter species? The indications so far are negative. According to the Registrar of the Plant Breeders’ Rights Office (PBRO), Evans Sikinyi (pers. comm., 2000), in the first few years most of the 200 plus applications came from foreigners,11 and were mostly for horticultural varieties with roses constituting about half the total. The public sector, which produces most new varieties bred in Kenya, has only just begun to show an interest in seeking protection. Its applications are now on the rise. While new firms are starting up, given the amount of time it takes to breed new varieties (see Juma, 1989, p153), it is likely to be several more years until any increased private sector breeding activity is reflected in a rise in the number of applications. But when it comes to research priorities, one of the (two) PBRO staff members warns that: PBR introduction is likely to weaken research on crop varieties that are less economic such as traditional food crops… The main threat lies in the anticipated displacement of some of the food security crops for cash crop/high value crops. The anticipated shift of research priorities will bring a problem in technology development and transfer for resolving food shortage problems and hence may stabilize food security (Chirchir, 1997, p17). If correct, the implication for trade is that while export performance in the food and agriculture sectors is likely to improve, the affected crops will be exotics. And the land left for cultivation of lower export-value native crops will shrink. On the other hand, if income from the sale of higher-value crops benefits the poor, the system may nonetheless be beneficial on balance, even for the poor. It is probably too early to say whether the system is a success or a failure, or how far the Kenyan experience would be repeated in other developing countries. At the present time, the most useful role the PVP system plays is probably that of encouraging the transfer of foreign-bred varieties to Kenya. This is necessary for those products heavily dependent on foreign breeding material and which are cultivated largely for export. Perhaps the most important of these are cut flowers (van Roozendaal, 1994).
216 National Case Studies Patents, agro-biotechnology and trade Kenya is far from being a hotbed of biotechnological invention. While there is limited capacity to use second-generation biotechnologies, Kenya depends heavily on foreign organizations such as corporations and development agencies for technology transfer, technical support and funding. The private sector in Kenya spends virtually nothing on agro-biotechnology research, and is not a user of genetic engineering techniques except for tissue culture (Falconi, 1999, pp4, 7), a situation that has not changed at all since the passage of the 1989 Industrial Property Act. Public sector research institutes and universities between 1989 and 1996 continued to contribute over 95 per cent of total research expenditure (Falconi, 1999, p4). And 67 per cent of total research funding was provided by foreign aid donors (Falconi, 1999, p6). While the ability of Kenyan firms to copy biotech inventions by reading foreign patent specifications may be quite limited, even this possibility is precluded when the same inventions are patented in Kenya. Therefore, allowing transnational corporations (TNCs) to acquire patents in Kenya only increases dependency without any apparent mitigating benefits. But this is not the whole story. It is also possible that without any serious domestic rivals, foreign agro-biotechnology firms may be more willing to share their technologies on concessional terms than in a country like India. What evidence is there to support such a possibility? In August 2000, KARI began testing a virus-resistant transgenic sweet potato with the aim of adapting it to Kenya through a collaboration with Monsanto that was brokered by a non-profit organization known as International Service for the Acquisition of Agri-biotech Applications (ISAAA). Although Monsanto does not own Kenyan patents on the technology or on the sweet potato, it would have been impossible for KARI to have got involved without Monsanto’s technical assistance. As part of the agreement, six KARI scientists are trained at Monsanto’s headquarters. The company has placed no restrictions on commercialization of the sweet potatoes, which can even be exported. This makes it ‘a true donation’, according to Florence Wambugu of ISAAA (pers. comm., 2000). Interesting as this agreement is, though, it did not require Kenya to allow Monsanto to patent the technology, suggesting that it was possible because Monsanto had nothing to lose commercially and much to gain in terms of public relations. Geographical indications, trade marks and trade Kenya has trade mark legislation and has drafted a geographical indications bill (Mbeva, 2000). As with India, these IPRs have possible applications for certain natural products. But apart from tea, coffee and kiondo baskets, there are few Kenyan products for which trade marks and geographical indications have obvious applications.
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The health sector Pharmaceuticals Kenya’s pharmaceutical industry has no companies with the capacity to carry out research that is likely to lead to patentable inventions (Leach, 1999). There are also few chemists who are able to reverse-engineer the more complex drugs manufactured abroad. With no critical mass of qualified chemists available, the domestic industry has nothing to gain from the 20-year patent term required by TRIPS, and perhaps little from compulsory licensing as well. In terms of technology transfer, pharmaceutical TNCs tend to file patents in Kenya, presumably because there are enough generic manufacturers to constitute a threat if they could freely use their products and processes. Even so, pharmaceutical TNCs do not patent in Kenya as comprehensively as they do in the developed-country markets (Lettington, 2000, pers. comm.). Research carried out by Owino (1996, p169) reveals that the domestic industry suffers from restrictive technology transfer agreements imposed by the TNCs that force them to buy active ingredients exclusively from them. This acts as a disincentive to local production, and consequently as a deterrent to improving domestic technological capacity. Whether TNCs have patents or not, there is no possibility of their carrying out R&D in Kenya. Pharmaceutical TNCs performing R&D outside their home countries do so almost exclusively in developed countries, and only a small number of developing countries (eg India) have any prospect of hosting TNC R&D facilities on any significant scale. With respect to pharmaceutical research based on natural products and/or traditional knowledge (TK), the private sector is not involved, only KEMRI. Since product patents were available throughout the 1990s, and the three-year addition to the patent term is unlikely to make a noticeable difference, we can conclude that either the international regime provides inadequate incentives for firms to carry out such research, or that incentives do exist, but firms are incapable of responding positively. Traditional and herbal formulations In spite of the availability of utility models, there have been no applications so far for herbal or nutritional formulations; and only 12 medicinal plant-related patents had been filed up to 2000 (Olembo, 2000). Again, this suggests that the patent regime is not creating any significant incentives for adding value to Kenya’s biogenetic resources or TK.
CONCLUSIONS Unlike India, Kenya has had no real transitional period to gear up to the new international IPR regime, and apparently has very little to gain from allowing patents for all fields of technology. On the other hand, it has much to lose from allowing TNCs to control technologies and amass large patent portfolios that
218 National Case Studies would inhibit process innovation. This does not mean Kenya can never gain from the international IPR regime. But when it comes to building up life science and biotechnology capacity and commercializing traditional knowledge and technologies, TRIPS is a hindrance at the present time and will continue to be so for the foreseeable future. Utility models, which are outside TRIPS, have some limited promise. But patents are too difficult to acquire for most communities, and also for many individual inventors and small companies. As for PVP rights, while they can benefit farmers (including smallholders) involved in the export of natural products, they do not encourage research on indigenous species at all.
Chapter 16 LESSONS FROM THE CASE STUDIES
INTRODUCTION If all developing countries are positioned somewhere along a continuum between being the best- and the worst-placed to benefit from the international intellectual property right (IPR) regime, especially patents, India and Kenya probably lie near the opposing ends. India has many advantages that Kenya does not have. These advantages relate not only to its much higher S&T potential, but also to its sheer size of population. In addition, India successfully took advantage of not allowing strong patent protection as a matter of government policy in order to build up its indigenous S&T capacities. This policy was not followed at all or to such an extent by most developing countries. Not surprisingly, while the two case studies led to some identical conclusions, there were some differences too. These similarities and differences are discussed in this brief chapter.
PLANT VARIETY PROTECTION The evidence suggests that in both countries, plant variety protection (PVP) is unlikely to encourage the addition of value to indigenous biogenetic resources, at least in ways that benefit traditional communities using poly-cultural agricultural systems to meet their food security needs and that encourage conservation and the sustainable use of local resources. However, while in India PVP will probably help increase the size of the private seed sector (if not the number of companies involved), this is less likely to happen in Kenya. But even if it were to happen, it would do little to encourage research into and conservation of indigenous biogenetic resources, and may in fact discourage such research if public sector research expenditure declines. Such a pessimistic conclusion may be true given Rangnekar’s (2000a) evidence that PVP tends to encourage the breeding of genetically similar varieties of only the most profitable crop species. However, even if one accepts his argument, this does not mean that without PVP, companies would be any more inclined to invest in
220 National Case Studies the breeding of indigenous species. One solution might be for countries like India and Kenya – should their governments consider this an important priority – to build incentives into the PVP system to carry out breeding on indigenous species just as the US provides additional incentives to develop ‘orphan drugs’ for rare diseases.
PATENTS AND AGRO-BIOTECHNOLOGY Allowing patents for agro-biotechnological products and processes does not appear to be at all beneficial for the Kenyan economy, and is likely to be a hindrance to technological development. As for the more effective commercial use of indigenous biogenetic resources, though, the patent regime will probably make little difference either way. On the other hand, India is likely to gain. India’s wealth of biogenetic resources and the biodiversity management regulations likely to come into force soon could give domestic firms an advantage over foreign firms that some of them should be able to exploit. But this is unlikely to encourage more sustainable use of resources unless bioprospecting expeditions were to reveal an extraordinarily large number of resources with commercial applications. It is unrealistic to expect this to happen.
PATENTS AND THE HEALTH SECTOR India’s long transition period stood the country in good stead. History is not on the side of countries like Kenya that allowed product patents on chemicals from an early stage of development. The examples of Switzerland and Germany in the 19th century (see Dutfield, 2003) and present-day India show that it is only after a country has a critical mass of scientific graduates that inventiveness in the life sciences can take place on any scale; and only once this stage has been reached can a patent system be of benefit to a country by rewarding and encouraging further invention. But will the new IPR regime encourage bioprospecting and the sustainable use of biogenetic resources? In India this is possible, but unlikely. In Kenya, even though its utility model system may be more suitable in certain respects, the possibilities are fewer still.
INTELLECTUAL PROPERTY RIGHTS AND TRADITIONAL KNOWLEDGE In both India and Kenya, attempts are being made to legally protect certain categories of traditional knowledge (TK). In India, this is to be done indirectly through the prevention of piracy of TK through biodiversity management regulations, rather than direct protection. In Kenya, protection of certain categories of TK is envisaged through the use of utility models. To date, the
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Kenyan approach has been a failure. It remains to be seen whether the Indian approach will succeed in preventing biopiracy.
INTELLECTUAL PROPERTY RIGHTS, VALUE ADDITION AND CONSERVATION For India, value addition can be encouraged by increasing the availability of strong IPR protection to cover pharmaceuticals, agrochemicals and biotechnological processes together with the biodiversity management regulations likely to come into effect soon. However, some areas of concern have also been identified, leading one to doubt that the overall effect of the global IPR regime will be positive. Patents may be beneficial in certain respects, and geographical indications (GIs) are even more promising. On the other hand, PVP is unlikely to help in the value-addition objective except through the development of new seed products based on a narrow range of crop germplasm. As for Kenya, the international regime is unlikely to lead to indigenous S&T capacity building in the life sciences. Any value addition will be in the context of exotic resources, and is likely, if anything, to encourage the erosion of indigenous biodiversity. However, it must be conceded that while patents and PVP have been subject to various justifications over the years, they have never been considered as regulatory systems to promote conservation. While there is every reason to argue that they should be in harmony with biodiversity management regulations, conservation is never going to be the raison d’être – or even a necessary by-product – of an IPR system.
NOTES
CHAPTER 1 SOVEREIGNTY, COMMON HERITAGE AND PROPERTY RIGHTS 1
The term ‘biological diversity’ first appeared in print in about 1980, and is associated with scientists like Edward O Wilson at Harvard University and Norman Myers, an independent conservationist. See Takacs (1996). 2 This is not to say that all developing countries are rich in biodiversity while all developed countries are not. Australia, for example, is much more biologically diverse than Mauritania. 3 They were also somewhat unhappy for a time about the influence of international conservation NGOs like the World Wide Fund For Nature (WWF) and the World Conservation Union (IUCN) that were allegedly pursuing a preservationist and anti-development agenda. 4 Pharmaceutical companies have been accustomed to paying fees to collectors of biological material such as plants and plant extracts. According to Laird (1993, pp108–109) ‘collectors receive between US$50 and $200 per kilogram sample’ while ‘payments for extracts can range between US$200 and $250 per 25-gram sample (compared to US$20 per soil sample)’. 5 The exotic–indigenous distinction is not finely drawn, so these adjectives should be treated with some caution. There is no agreement when or why a species introduced to a country through, say, population movements, trade or colonialism should eventually be considered as indigenous to that country. 6 These are the Ford Foundation, Kellogg Foundation, Rockefeller Foundation and Syngenta Foundation for Sustainable Agriculture. 7 Genomics refers to the mapping, sequencing and analysis of the full set of genes (ie the genome) of different organisms or species. The human genome has always been the most interesting for governments and foundations, as well as for companies seeking to identify commercial applications. 8 The proteome is the ‘protein complement encoded by a genome’, and consists of three activities: ‘identifying all the proteins made in a given cell, tissue or organism; determining how these proteins join forces to form networks akin to electrical circuits; and outlining the precise three-dimensional structures of the proteins in an effort to find their Achilles heel – ie, the contexts in which drugs might turn their activity off or on’ (Ezzell, 2002, p28). 9 RNA (ribonucleic acid) interference (‘RNAi’), or ‘gene silencing’, is a method of disrupting the body’s production of proteins associated with diseases. 10 Traditionally, marine fisheries were also treated as common property resources. But the failure of the common property regime to prevent over-fishing has led to
Notes 223 considerable changes in how fisheries are treated in international law. 11 As Kloppenburg and Kleinman (1987, p9) expressed it, ‘the Undertaking is viewed as nothing less than an assault on the principle of private property. And in fact it is. Governments and companies of the advanced industrial nations have good reason for concern. What the FAO Undertaking demands is literally the decommodification of commercial plant varieties.’ 12 In fact, by 1985 some developing countries, such as Ethiopia, Brazil, Mexico and Argentina, became less favourable to the IU. Rajan (1997, p170) suggests that this shift may be because ‘prominent developing countries recognized that they had miscalculated in trying, among other things, to win a moral victory over the North by pressing for universal unrestricted access to plant genetic resources, and that the principle of free access could include access to their own commercially valuable genetic stocks; consequently, they toned down their support for the principle, in the process advertising differences within the South.’ 13 The Paris Convention was revised in 1900, 1911, 1925, 1934, 1958 and most recently in 1967. 14 The UPOV Convention was adopted in Paris in 1961 and entered into force in 1968. It was revised in 1972, 1978 and 1991. The 1978 Act entered into force in 1981, and the 1991 Act in 1998. The convention established the International Union for the Protection of New Varieties of Plants, which is based in Geneva and has a close association with the World Intellectual Property Organization (WIPO) to the extent that the latter organization’s director-general is also secretarygeneral of UPOV. UPOV stands for Union Internationale pour la Protection des Obtentions Végétales. 15 In this context ‘institutions’ are not organizations but are what North (1991, p97) refers to as ‘the humanly devised constraints that structure political, economic and social interaction’ which ‘consist of both informal constraints (sanctions, taboos, customs, traditions, and codes of conduct), and formal rules (constitutions, laws, property rights)’.
CHAPTER 2 BIOTECHNOLOGY AND THE EXPANDING BOUNDARIES OF INTELLECTUAL PROPERTY PROTECTION 1
2
3
Hybridoma cells result from the fusion of a type of cancer cell known as a myeloma with another antibody-producing cell. Hybridomas produce multiple antibodies of a highly specific type, which are called monoclonal antibodies. The technology, which was developed in 1975 by Georges Köhler and Cesar Milstein working in Cambridge at the Medical Research Council’s Laboratory of Molecular Biology, has considerable potential in both diagnostics and therapeutics. PCR technology provides a rapid means for replicating potentially vast quantities of a selected DNA section in a test tube. The technology works by using taq polymerase, an enzyme from a thermophilic (heat resistant) bacterium that was discovered in a hot spring in Yellowstone National Park. PCR is an extremely valuable research tool with many applications including genome sequencing and diagnostics. Some critiques of ‘biotechnology’ for developing countries are basically critiques of one biotechnology and one application, namely genetic engineering for crop development (eg Altieri and Rosset 1999; Kloppenburg and Burrows 1996; Shiva
224 Intellectual Property Rights, Biogenetic Resources and Traditional Knowledge
4 5
6 7
1990). See Seiler (1995) for a sophisticated critique based on a more careful definition of biotechnology. He agues that due to the increased privatization of R&D and TNC control over research tools and technologies, much of biotechnology’s potential to benefit developing countries will not be realized. Cragg et al (1997) classify ‘drugs of natural origin’ as being either ‘original natural products, products derived semisynthetically from natural products, or synthetic products based on natural product models’. Overuse of the word ‘wild’ has come under criticism in some quarters. As Posey expressed it, there is a common but ill-informed tendency to presume ‘that just because landscapes and species appear to outsiders to be “natural”, they are “wild” and – therefore – unowned’ (Posey, 1996, p55). Posey promoted the term ‘nondomesticated resources’ in place of ‘wild resources’ for this reason. The patent is commonly referred to as the oncomouse patent, since it describes a mouse into which a gene has been introduced that induces increased susceptibility to cancer. EPO Decision G 01/98; http://www.european-patentoffice.org/dg3/biblio/g980001ex1.htm.
CHAPTER 3 THE INTERNATIONAL LAW OF BIOGENETIC RESOURCES AND INTELLECTUAL PROPERTY 1
As of 23 April 2004, 144 countries, plust the European Community, Hong Kong and Chinese Taipei, undertake to implement TRIPS by virtue of their membership of the WTO. 2 UPOV 1978 also contains a reciprocity provision. 3 Article 5 is on multilateral agreements on acquisition or maintenance of protection. 4 Section 104 of the US Patent Act stated that ‘in proceedings in the Patent and Trademark Office, in the courts, and before any other competent authority, an applicant for a patent, or a patentee, may not establish a date of invention by reference to knowledge or use thereof, or other activity with respect thereto, in a foreign country …’. In December 1994, the phrase ‘other than a NAFTA country or a WTO member country’ was added to this sentence. 5 The Concise Oxford Dictionary, 8th edn (1991). 6 The EC Directive on the Legal Protection of Biotechnological Inventions seeks to make PBRs and patents operate more harmoniously by providing that where the acquisition or exploitation of a PBR is impossible without infringing a patent, or vice versa, a compulsory licence may be applied for. If issued, the licensor party will be entitled to cross-license the licensee’s patent or PBR. 7 Although this term is frequently used by breeders, many farmers, especially in developing countries, would probably prefer this practice to be characterized as a right rather than as a privilege. 8 ‘Only about 7% of wheat seed and 13% of rice seed planted in India is from the formal sector’ (Turner, 1994, cited in Tripp, 1997). 9 As of 23 May 2004 (including the EU). 10 For the most comprehensive overview of the various possible approaches for implementing Article 15, see Glowka (1998). 11 Along with appropriate access to genetic resources and appropriate funding (Article 1). 12 Thailand is another notable non-party.
Notes 225 13 The Commission on Plant Genetic Resources was established in 1983 as a permanent forum for governments to negotiate on issues relating to plant genetic resources. Currently more than 160 countries are members. In 1995 it was renamed the Commission on Genetic Resources for Food and Agriculture (CGRFA) in line with its broadened mandate, which now covers all components of agricultural biodiversity relating to food and agriculture.
CHAPTER 4 NATIONAL SOVEREIGNTY, BENEFIT SHARING AND THE PATENTING OF LIFE 1 2
3 4 5
6
7 8 9
Note here that commercialization does not only refer to when products developed from the patented invention are placed on the market; patents themselves are products for many companies, since they can be sold and licensed. As expressed by three medical researchers at the University of Western Ontario, ‘the disease of cancer was certainly far from our thoughts when we learned of a tea made from the leaves of a West Indian shrub that was supposedly useful in the control of diabetes mellitus’ (Noble, Beer and Cutts, 1958 p882). From the notes of a presentation made by Kushan on ‘Patents and biopiracy: getting to the bottom of the debate’ at the WIPO Conference on the International Patent System, Geneva, March 2002. It is worth noting in passing here that rarely, if ever, are indigenous communities invited to jointly own a patent or traditional healers are named as inventors. For example, when the US drug company G.D. Searle licensed the know-how of certain Aguaruna communities, this appeared to many observers as an endorsement of the commercial potential of traditional knowledge. In fact, the company was only really interested in random screening, so the arrangement seems to have been mostly about public relations (Greene, 2002). H.K. Mulford and Co. actually held two patents for a glandular extractive product in the form of a purified form of adrenaline, and for this compound in a solution with salt and a preservative. In a 1911 court case, Parke Davis and Co., which was accused by H.K. Mulford of infringing its patents, defended itself on a number of grounds, one of which was that the inventions were mere products of nature and that this made the patents invalid. The judge, ruling in favour of Mulford, held that ‘Takamine [ie the inventor] was the first to make it available for any use by removing it from the other gland-tissue in which it was found, and, while it is of course possible logically to call this a purification of the principle, it became for every practical purpose a new thing commercially and therapeutically.’ See Parke Davis and Co. vs. H.K. Mulford and Co., 189 Fed. 95 (S.D.N.Y. 1911), affirmed, 196 Fed. 496 (2nd Circuit 1912). US Patent No. 1,469,994 (issued 9 October 1923) (‘Extract obtainable from the mammalian pancreas or from the related glands in fishes, useful in the treatment of diabetes mellitus, and a method of separating it’). US Patent No. 2,446,102 (issued 27 July 1948) (‘Complex salts of streptomycin and process for preparing same’; US Patent No. 2,563,794 (issued 7 August 1951) (‘Vitamin B12’). European Patent Office (nd), Guidelines for Examination in the European Patent Office, Munich: EPO, at Part C-IV, 2.3. It is worth comparing this with the rather different Article 15(b) of the Andean Community’s Common Intellectual Property Regime (Decision 486), which entered into effect in December 2000. The following
226 Intellectual Property Rights, Biogenetic Resources and Traditional Knowledge
10
11 12
13 14
15
16 17
(among others) are not considered to be inventions: ‘Any living thing, either complete or partial, as found in nature, natural biological processes, and biological material, as existing in nature, or able to be separated, including the genome or germplasm of any living thing’. A person shall be entitled to a patent unless: (a) the invention was known or used by others in this country, or patented or described in a printed publication in this or a foreign country, before the invention thereof by the applicant for patent, or (b) the invention was patented or described in a printed publication in this or a foreign country or in public use or on sale in this country, more than one year prior to the date of the application for patent in the United States (35 USC §102). See 35 USC §102(f). How foreign prior art may be used in determining the novelty of an invention varies from one legal jurisdiction to another. In some countries, inventions cannot be patented if prior knowledge, use or publication exists anywhere in the world. Elsewhere, only unpublished foreign use or knowledge cannot be taken into account in prior art searches. But in a few countries, only domestically held knowledge, use or knowledge manufacture is accepted. Philip Grubb, a corporate patent lawyer, helpfully refers to these different conceptions of novelty respectively as absolute novelty, mixed novelty and local novelty. See Grubb (1999, p54). According to Ozawa, mixed novelty operates in Australia, China, India, Republic of Korea and the US. Local novelty operates in Egypt, Fiji, New Zealand and Panama. See Ozawa (2002, p46). US Patent No. 5,401,504 (issued March 28, 1995) (‘Use of turmeric in wound healing’). It is worth emphasizing the words ‘may be’. Many patents are granted that should not be and the problem seems to be largely due to the failure of the system to more efficiently enable examiners to identify novelty-destroying prior art published even in the US. Examples are legion, but IBM deserves an honourable mention for US Patent No. 6,329,919 (issued 11 December 2001) (‘System and method for providing reservations for restroom use’), as does Wen Ya-Yeh for US Patent No. 6,257,248 (issued 10 July 2001) (‘Both hand hair cutting method’), and Dale Miller’s US Patent No. 5,616,089 (issued 1 April 1997) (‘Method of putting’). US Patent No. 6,267,995 (issued 31 July 2001) (‘Extract of Lepidium meyenii roots for pharmaceutical applications’). US Patent No. 6,093,421 (issued 25 June 2000) (‘Maca and antler for augmenting testosterone levels’).
CHAPTER 5 BIOPIRACY 1
2 3 4
This comment is not to make light of people’s concerns about biopiracy, but to suggest that in cases where the distribution of a given resource is very wide or knowledge is held by large numbers of people or communities it may not be clear who, if anyone, is actually being exploited. See WIPO/PCT International Publication No. WO 98/46243 (‘Pharmaceutical compositions having appetite suppressant activity’). US Patent No. 5,894,079 (issued 13 April 1999) (‘Field bean cultivar named enola’). In fact, Proctor indicated in his application for a PVP certificate on Enola (that was subsequently granted) that ‘the yellow bean, Enola variety, is most likely a
Notes 227
5 6 7
8
9
10 11
12 13
14
15
landrace from the [Mexican] azufrado-type varieties’ (ETC Group, 2001a). Merrell Dow vs. HN Norton (1996) Intellectual Property Reports, 33, pp 1–14, at 10. Ibid. US Patent No. 4,673,575 (issued 16 June 1987) (‘A pharmaceutical preparation comprising the methanol extractable components of Phyllanthus niruri L, administered to patients suffering from hepatitis B virus infection to inhibit the growth of the virus’). Among those business associations that have issued constructive public statements are the European Chemical Industry Council (CEFIC) and the International Chamber of Commerce (ICC). See CEFIC (2002) and ICC (2001). Also, the Biotechnology Industry Organization is developing a set of principles on respecting local cultures and ensuring fair compensation for indigenous peoples. In addition, the World Business Council for Sustainable Development has engaged in some fruitful and worthwhile dialogues with stakeholders to discuss the issue of traditional knowledge. Otherwise, industry tends to be overly defensive and makes few if any constructive proposals of its own. In sum, industry’s contribution to the debate has mainly been limited to restating its support for the Convention on Biological Diversity (CBD), pointing out what it considers to be the unfeasibility of proposals that others have made, and warning against over-regulation in national and regional access regimes. As Correa explains (2001a, p11): ‘Only a few (several dozen) “new chemical entities” … are developed and patented each year. Nonetheless, thousands of patents are granted annually in this sector. This paradox can be explained by the enormous capacity that the sector’s major firms have built up not only for developing authentic inventions, but also for taking out patents on secondary, occasionally trivial developments, in order to extend their monopoly over a product or process, beyond that allowed by the original patent’. Referred to by Stenson and Gray (1997) as ‘cultural communities’. Although they accept that individuals in communities can be innovative, their basic understanding is that ‘the “traditionality” of traditional knowledge – the fact that it is common knowledge, the product of collective experience without a single act of creation – precludes its being seen, from the point of view of an entitlement theory, as intellectual property’ (ibid.). Indeed, their paper can be read as a critique of the writings of advocates that resort to excessive use of rhetoric to state their case and tend to have romantic views about ‘communities’. Having made this point, it should still be noted that two of the most controversial neem patents – US patents 4,556,562 (‘Stable anti-pest neem seed extract’) and 5,124,349 (‘Storage stable azadirachtin formulation’) – both describe fairly basic chemical processes that could conceivably render the invention ‘obvious’ to one who is skilled in the art (see Kadidal, 1997). Use of the term ‘indigenous peoples’ here means those populations that conform to the definition of ‘indigenous and tribal peoples’ in the International Labour Organization Convention Concerning Indigenous and Tribal Peoples in Independent Countries (ILO Convention 169). The analogy does not apply so well to other traditional rural populations who may of course be equally oppressed. For example, John Locke considered America to be in a state of nature (‘In the beginning all the world was America’) in which indigenous modes of governance did not constitute political society, and customary land use was not a legitimate form of property rights. Tully (1993, pp137–176) provides evidence that some
228 Intellectual Property Rights, Biogenetic Resources and Traditional Knowledge British colonists found Locke’s ideas convenient in justifying the dispossession of indigenous peoples from their lands. Interestingly, if Locke had recognized (as a few British colonists of the time did) that indigenous peoples regarded themselves as self-governing nations, his theory of government could have been used to legitimize their violent rebellion against the British (ibid.). 16 Even today, traditional forest communities in some countries (eg Latin America) can more easily acquire legal title to their lands if they ‘improve’ them by removing the trees so that they are no longer ‘virgin forests’. The same rules may also apply to colonists.
CHAPTER 6 ENVIRONMENTAL IMPACTS 1
2 3
This is also a food security issue. The mass-cultivation of uniform varieties based on a narrow range of breeding material can result in outbreaks of devastating diseases. This happened with the potato crop in Ireland in the 1840s, and in the US in the 1960s and 1970s with wheat and maize respectively. Of course, many such disease outbreaks predated the introduction of plant breeders’ rights (PBRs) to the affected countries. Despite this, critics argue that PBRs encourage the genetic uniformity that can potentially increase the dangers of such outbreaks occurring. Monsanto World Wide Web site (http://www.monsanto.com). For excellent assessments of the environmental impacts of agricultural biotechnology see Lappé and Bailey (1999) and Krimsky and Wrubel (1996).
CHAPTER 7 AGRICULTURE, FOOD SECURITY AND NUTRITION 1 2 3
However, a small number of countries allow plant varieties to be patented. These include the US, Japan, Australia and Hungary. It is true, however, that cash-strapped governments have to reduce their research expenditures out of necessity and the private sector can play a useful role in taking up the slack. According to Heitz (pers. comm. 1998), this model is based on an abandoned IPR system devised in Czechoslovakia in the 1920s.
CHAPTER 8 BEYOND INTELLECTUAL PROPERTY: TECHNOLOGY PROTECTION SYSTEMS 1 2
3
US Patent No. 5,723,765 (issued 3 March 1998) (‘Control of plant gene expression’). In a discussion on private appropriation in the business of plant breeding, Rangnekar identifies four methods employed: IPRs and seed market regulation; organizational solutions; discontinuous heritability; and planned obsolescence. He classes hybrid and terminator technologies as methods of discontinuous heritability (Rangnekar, 2002b, pp1015–1017). Growing for seed is more costly but, on the other hand, seed prices are significantly higher than grain prices (Rangnekar, pers. comm. 2003).
Notes 229 4 5 6 7 8
9
The correspondence between the US Patent and Trademark Office and the Office of the Union and the US government’s response to the memorandum is incorporated in UPOV document CAJ/7/7 as Annex II. Transcript of presentation made at side event of the fourth meeting of the Conference of the Parties to the Convention on Biological Diversity at Bratislava, Slovakia in June 1998. (On file with author). Article 8 of the 1996 WIPO Copyright Treaty and Articles 10 and 14 of the 1996 WIPO Performances and Phonograms Treaty. This is not to deny the possible existence of other grounds for doing this. According to ETC Group (2001b, p9), ‘the top 10 seed companies control approximately 30% of the $24.4 million commercial seed markets worldwide’. Tansey (2002, p20) notes that ‘the US seed industry, once the preserve of many small firms, has become dominated by five major firms – in part as a response to litigation over broad patents awarded in the early days of GM in the USA’. As early as 1987, it was noted that ‘a substantial amount of plant research in private firms has been aimed at developing various types of seed-chemical packages that reinforce rather than threaten sales of agricultural chemicals’ (Buttel and Belsky, 1987).
CHAPTER 9 LIFE SCIENCE INNOVATION, BIOTECHNOLOGY TRANSFER AND DEVELOPING COUNTRIES 1 2
3 4
5 6
7
Governments are also involved in technology transfer. Informal and free-of-charge technology transfers are possible. Similarly, Vishwarao (1994, p381) suggests the possibility that gains for developing countries from lack of IPR protection would be ‘offset by strategic behaviour by Northern firms who opt for technology transfer via subsidiary or monopoly production’. But having made this point, licensing agreements can also be quite restrictive with respect to the licensees’ freedom to use and profit from the technologies. The relevance of tacit knowledge goes further than merely casting doubt on the notion of patents as a reward for disclosing an invention. Even without patents, companies may enjoy a powerful position since those wishing to acquire tacit knowledge may have no alternative but to license it from holding firms. This situation may be changing somewhat with patent databases being placed on the Internet. And are required by TRIPS to do so in the case of least developed countries: ‘developed country Members shall provide incentives to enterprises and institutions in their territories for the purpose of promoting and encouraging technology transfer to least-developed country Members in order to enable them to create a sound and viable technological base’ (Article 66.2). An example is the International Service for the Acquisition of Agri-biotech Applications (ISAAA), which was established to facilitate the acquisition and transfer of agricultural biotechnology applications, particularly proprietary technology from the private sector to developing countries (see Krattiger and James, 1993–1994).
230 Intellectual Property Rights, Biogenetic Resources and Traditional Knowledge 8
Some critiques of ‘biotechnology’ for developing countries are basically critiques of one biotechnology and one application, viz. genetic engineering for crop development (eg Altieri and Rosset 1999; Kloppenburg and Burrows 1996; Shiva 1990). See Seiler (1995) for a sophisticated critique based on a more careful definition of biotechnology. He agues that due to the increased privatization of R&D and TNC control over research tools and technologies, much of biotechnology’s potential to benefit developing countries will not be realized.
CHAPTER 10 TRADITIONAL KNOWLEDGE AND THE INTELLECTUAL PROPERTY SYSTEM 1
It might be countered that since the indigenous peoples of western Amazonia do not really understand why quinine works, their quinine-based treatment is a technology that is not science-based. If that is so, however, one could infer that many western ‘scientific’ applications ought likewise to be ‘downgraded’ to technologies, since they are not based on a complete understanding of why they work. 2 Liu (2003) identifies five ways that traditional Chinese Medicine (TCM) inventions may fulfil the patentability requirements: (1) new techniques for preparation of TCM; (2) isolation of responsible component(s) of TCM; (3) new functions of TCM; (4) new prescriptions; and (5) new pathways of administration of TCM. 3 See generally Cleveland and Murray (1997), discussing aspects of the debate over the protection of indigenous farmers’ rights; Griffiths (1993), discussing the concept of exclusive rights as it is inherent in indigenous communities regarding magical knowledge. Shamans and other TK-holder specialists may wish to restrict access to their knowledge for reasons other than because they consider it to be their property. For example, sacred knowledge – which may include knowledge of the therapeutic properties of plants – is often considered dangerous if it gets into the hands of the uninitiated. In other words, healers may be concerned for the welfare of those who acquire the knowledge and try to use it. The author is grateful to the late Darrell Posey for this insight. 4 For example, in 1982 the Model Provisions for National Laws on the Protection of Expressions of Folklore Against Illicit Exploitation and Other Prejudicial Actions were adopted by a Committee of Governmental Experts jointly convened by UNESCO and WIPO. 5 Moral rights include the right of authors to be identified as such, and to object to having their works altered in ways that would prejudice their reputation. 6 This point does not suggest that computer programs are unworthy of protection, but that they are hardly works of literature in the strict sense. 7 Information provided by Dr Rocio Alarcon of Ecociencia at the Oxford University seminar on 7 February 2001. 8 Website of the Darjeeling Planters Association (http://www.darjeelingtea.com). 9 ‘Basmati’ is Hindi for ‘the fragrant one’. 10 Usually, an application for PVP requires the completion of an application form, a description of the variety, and the deposit of propagating material. This material may be used by a government institution to conclusively demonstrate stability and homogeneity through propagation trials. 11 The International Code of Nomenclature for Cultivated Plants is regulated by the International Commission for the Nomenclature of Cultivated plants (ICNCP),
Notes 231 which operates under the aegis of the International Union of Biological Sciences. The latest edition of the code is published in Trehane et al (1995).
CHAPTER 11 ALTERNATIVE APPROACHES TO TRADITIONAL KNOWLEDGE PROTECTION 1
2
3
4 5
6
Legal opinion differs as to whether recitals of EU directives are legally binding or not. Whichever is the case, the word ‘should’ does not suggest an absolute legal requirement. It is worth noting that Recital 27 resulted from a compromise between Denmark, which had originally proposed that such information disclosure be the subject of an article of the Directive, and other EU members that considered that making it mandatory would add another substantive condition on patentability and would therefore violate the TRIPS Agreement. See van Overwalle (2002, p233). Article 3, which was not mentioned earlier, states that ‘States have, in accordance with the Charter of the United Nations and the principles of international law, the sovereign right to exploit their own resources pursuant to their own environmental policies, and the responsibility to ensure that activities within their jurisdiction or control do not cause damage to the environment of other States or of areas beyond the limits of national jurisdiction.’ This approach has been criticized on the basis of both legality and practicality. With respect to the former, van Overwalle (2002, pp234–235) notes that the legal basis for such an application of the ordre public and morality concepts is very weak. She argues that there is no precedent in Belgium or in civil law countries more generally for construing ordre public and morality concepts so broadly or for applying them to acts such as these which, wrong as they may seem to many people, would not be considered as extreme examples of intolerable or publicly unacceptable behaviour. The certification of origin idea was devised by Brendan Tobin, currently of United Nations University. See Tobin (1997). According to Article 6bis paragraph 1: Independently of the author’s economic rights, and even after the transfer of the said rights, the author shall have the right to claim authorship of the work and to object to any distortion, mutilation or other modification of, or other derogatory action in relation to, the said work, which would be prejudicial to his honour or reputation. For a detailed account of the process of developing the regime, see Tobin and Swiderska (2001).
CHAPTER 12 INTERNATIONAL FORUMS AND PROCESSES 1 2 3 4 5
Joint WTO-WIPO press release, 21 July 1998. These joint sessions led to the development of the aforementioned WIPO Performances and Phonograms Treaty and to the WIPO Copyright Treaty. UNESCO-WIPO World Forum on the Protection of Folklore, Phuket Plan of Action, 235, UNESCO and WIPO (8–10April 1997). The participants suggesting such actions included all except the representatives of the US and UK governments. The two other issues are biotechnology and biodiversity, and intellectual property and development.
232 Intellectual Property Rights, Biogenetic Resources and Traditional Knowledge 6
7
One of the early outcomes of this more applied phase of the work is a Study commissioned jointly by WIPO and the United Nations Environment Programme on the role of IPRs in the sharing of benefits arising from the use of biological resources and associated TK. The Study consists of an introductory review, case studies and an analytical synthesis. The case studies were released by WIPO and UNEP in Nairobi in May 2000 at the Fifth meeting of the COP. See WIPO and UNEP (2000). These include the Ad hoc Open-ended Working Group on Access and BenefitSharing and the Ad hoc Open-ended Inter-sessional Working Group on Article 8(j) and Related Provisions.
CHAPTER 13 GOVERNMENT AND REGIONAL INITIATIVES 1 2 3
4
Formally known as the Cartagena Accord and previously commonly referred to as the Andean Pact. This sub-section draws on Ruiz (2000). The Commission will consist inter alia of government ministers and representatives of the national protected areas system, the university sector, the private sector and the national peasant (campesino) and indigenous peoples associations. And that of another institution, the National System of Conservation Areas (SINAC).
CHAPTER 14 INDIA 1 2
3 4 5 6 7 8 9
Website of the Tata Energy Research Institute (http://www.teriin.org). Though it is worth mentioning that high-technology industry tends not to be labour intensive and is unlikely to absorb any significant proportion of workers in countries with large numbers of unemployed and illiterate people (Macdonald, 1998, p163). Indians constitute about 38 per cent of the Silicon Valley workforce (Gardner, 2000). 10 per cent of India’s annual foodgrains production is lost due to ‘poor postharvest practices’ (Bose, 1999a, p38). Annual losses of fruits and vegetables are estimated at US$6.68 billion (Bose, 1999a, p38). At October 2000 prices. Website of the Tea Board of India (http://tea.nic.in), visited on 8 October 2000. (Exchange rate as at 5 October 2000). The task of developing the NBSAP is being coordinated by Ashish Kothari, a wellknown environmental activist with strong views on IPRs and access and benefit sharing. Scientists have succeeded in inducing insect resistance in crops like corn and cotton by inserting genes from a soil microbe called Bacillus thuringiensis (Bt) that is toxic for certain insects. The Bt crops are now cultivated in several countries. US Patent No. 4673575 (‘Composition, pharmaceutical preparation and method for treating viral hepatitis’).
Notes 233 10 EP0890360 (‘A polyherbal pharmaceutical composition useful in the treatment of conditions associated with hepatitis E and hepatitis B virus infections’). 11 The institutional home of the Honey Bee Network is the Society for Research and Initiatives for Sustainable Technologies and Institutions (SRISTI), based at the Indian Institute of Management in Ahmenabad. 12 Figures provided by Shukla (pers. comm., 2000). 13 http://www.nifindia.org. 14 Website of the Darjeeling Planters Association (http://www.darjeeling.com). 15 This was later revoked by the government on the grounds of being prejudicial to the public. 16 A number of developing countries (eg Egypt and Brazil) introduced patent legislation motivated by similar concerns. 17 In this context it is worth considering Pray and Basant’s (1999, p20) observation that ‘hybrid seed is becoming viable in more and more crops’. This suggests that UPOV-type plant breeders’ rights (PBRs) are becoming less useful as systems of appropriation for plant breeders and may eventually become obsolete. 18 The kind of productivity farmers are looking for may be in terms of yield per hectare, but not necessarily. It is likely to depend upon which factors of production are the scarcest. 19 Even so, Mr R S Arora, Secretary General of the Seed Association of India, was non-committal when asked whether he felt the PBR legislation would result in increased research on non-hybrids (pers. comm., 2000). 20 Clearly governments such as the US would be completely dissatisfied with a PBR system that did not provide exclusive rights whatever a TRIPS dispute settlement panel would decide. 21 Use of the word ‘new’ here requires a clarification. As a way to explain this, the US government would prefer European consumers to accept that genetically modified soybean is not new but is identical as a product to non-GM soybean, and that labelling is therefore unnecessary. On the other hand, Monsanto markets Roundup Ready soybean to farmers as a new product that is better than other types of soybean. So I use the word ‘new’ (and place it in inverted commas) to make the point that producers of GM seeds or food might seek to market their products as being new. 22 Ramani (1996, p20) notes that ‘while the non-involvement of Indian firms in radical innovations can be explained in part by their financial constraints, they are also distinct from their Western counterparts in developing their technological competence in-house.’ 23 Although they are quite common.
CHAPTER 15 KENYA 1 2 3 4 5
One important exception is pyrethrum extract, of which Kenya is the world’s largest exporter. Statistics from Government of Kenya (1996, pp6–7). This paragraph and the following two are based on information published on the NMK website (http://www.museums.or.ke). They also benefited from an email communication from Robert Lettington of ICIPE. http://www.museums.or.ke/resmole.html. At the same time, the figure for India was 1.0 percent (Lall, 2000, p47).
234 Intellectual Property Rights, Biogenetic Resources and Traditional Knowledge 6
Africa Online website (http://www.africaonline.co.ke/AfricaOnline/kenya/chapter11a.html). 7 http://www.africaonline.co.ke/AfricaOnline/kenya/chapter11a.html. 8 This is the long title of the Industrial Property Act. 9 According to the Director of KIPO, Norah Olembo, the decision to introduce such legislation followed a Kenyan government agency’s discovery of a possible treatment for AIDS that it could not get patent protection for without applying first in the UK (pers. comm., 2000). 10 These exceptions are very similar to those of the European Patent Convention and the UK Patents Act 1977. 11 According to Cullet (2001), foreigners submitted 91 per cent of the applications from 1997 to 1999.
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INDEX Aborigines 101, 102 access and benefit sharing 6, 12, 112, 113, 114, 135, 136, 143, 149, 153, 155, 157, 160, 161, 172, 207 bargaining power of developing countries 6–10 national and regional laws 138–161 adrenaline 3, 48 African Model Legislation for the Protection of the Rights of Local Communities, Farmers and Breeders, and for the Regulation of Access to Biological Resources 68, 153–159, 160–161 Agreement Governing the Activities of States on the Moon and Other Celestial Bodies 10 Aguaruna 119 AICRPE (All India Coordinated Research Project on Ethnobiology) 180 AIPPI (International Association for the Protection of Industrial Property) 29, 33 Andean Community Decision 391 119, 143–148, 159, 160, 161 animal breeding 14 Anna University 175 Arya Vaidya Pharmacy 179 ASSINSEL (International Association of Plant Breeders) 33 AstraZeneca 175 ayahuasca 58 basmati 108, 165, 170, 173, 197, 198 Bayer 179 Berne Convention on the Protection of Literary and Artistic Works 100, 116, 132 Biological Diversity Act (India) 172, 173–174
biopiracy 7, 52–59, 99–100, 115, 201, 220, 221 definition 52 examples of 47, 52–59 bioprospecting 6, 12, 48, 138, 139, 140, 141, 142, 145, 152, 160, 183, 185, 199, 200, 220 biotechnology 4, 14–24, 145, 165, 168, 174, 182–183 agricultural biotechnology 15, 18, 174, 176–178, 184, 191, 195–197, 216, 220 competition between the US, Europe and Japan 17 definition of 14 and developing countries 17–18 health biotechnology 15, 18, 175, 178–179 Biotics Research Corporation 50 botanical medicines see also medicinal plants 20, 185, 202 Botanical Survey of India 172, 180 Boyer, Herbert 15 Budapest Treaty on the International Recognition of the Deposit of Micro-organisms for the Purpose of Patent Procedure 132 Bulun Bulun v Nejlam Pty. 102 Bulun Bulun v R & T Textiles Pty. 103 Bush, President George 38 Catharanthus roseus 47 CBD (Convention on Biological Diversity) 3, 5, 6, 10, 37–39, 45, 47, 112, 114, 128, 142, 143, 144, 149, 153, 160, 207 Article 8(j) 37–38, 111, 130, 147, 153 Article 15 38, 45, 111, 129, 153 Article 16 38, 86, 111, 131 Article 18 83
Index 253 Article 22 131 Bonn Guidelines on Access to Genetic Resources and Fair and Equitable Sharing of the Benefits Arising out of their Utilization 129, 136 Conference of the Parties (COP) 38, 76, 132, 136–137 Celera 16 Central Drugs Research Institute of India 180 Central Institute of Medicinal and Aromatic Plants of India 183 CGIAR (Consultative Group on International Agricultural Research) 7, 8, 11, 40 CIAT (International Center for Tropical Agriculture) 8, 55, 146 CIMMYT (International Maize and Wheat Improvement Centre) 8 CIP (International Potato Center) 146 Cipla 185 cloning 15 Cohen, Stanley 14 Colorado State University 54 combinatorial chemistry 8, 9, 98 common heritage of mankind 4, 5, 10–11, 173 common property 10 CONAGEBIO (National Biodiversity Management Commission of Costa Rica) 149, 150, 151, 152 Confederation of Indian Industry 172 Conference of the Parties to the CBD see CBD Convention on the Unification of Certain Points of Substantive Law on Patents for Invention 29 copyright 11, 78, 100–104, 151 Costa Rica Biodiversity Law 148–152, 159–160, 161 Council for Scientific and Industrial Research (of India) 175 Council for Scientific and Industrial Research (of South Africa) 52 Dabur 180, 185 Darjeeling tea 165, 170, 185, 198 dedicated biotechnology firm (DBF) 15–17
DeKalb 75 Delta and Pine Land 74, 77 Dene 101 DENR (Department of Environment and Natural Resources of the Philippines) 139, 141 Department of Biotechnology of India 175 Department of Indian Systems of Medicine and Health 201 Department of Science and Technology of India 181 Directive on the Legal Protection of Biotechnological Inventions 22, 24, 111 Directive on the Legal Protection of Databases 26 Disclosure of origin 111–114, 129–130, 135, 136, 137, 189, 195 Dr Reddy’s Lab 178, 179, 185 Ecociencia 106 Eli Lilly 47 enola bean 54–55 Environmental Management and Coordination Act (Kenya) 207 Environmental Protection Act (India) 172 equity 45–48 ETC Group (Action Group on Erosion, Technology and Concentration) 54, 55 European Patent Convention 23, 24, 27, 29, 49, 114 European Patent Office 23–24, 29–30, 53, 114 fairness see equity FAO (Food and Agriculture Organization of the United Nations) 4, 8, 97 Commission on Genetic Resources for Food and Agriculture 19, 39–40 Commission on Plant Genetic Resources see Commission on Genetic Resources for Food and Agriculture farmers’ rights 39, 41, 151, 154, 156, 157, 158 food security 13, 66–73, 154, 168–169, 205, 219
254 Intellectual Property Rights, Biogenetic Resources and Traditional Knowledge foreign direct investment 83, 85, 199 Forest Conservation Act (India) 172 Fowler, Cary 4 Fox Chase Cancer Center 57, 180 Funk 75 GATT (General Agreement on Tariffs and Trade) see also WTO 25, 132 Gene Bank of Kenya, 208 Gene Campaign 175 genetically modified (GM) crops 15, 18, 62–63, 65, 77, 178, 195 genetic engineering 14, 15 genetic erosion 4, 60–65 genetic use restriction technologies (GURTS) 74–79 genomics 8, 16, 17, 98 geographical indications 30–31, 107, 108, 185, 197–198, 202–203, 216, 221 Geographical Indications of Goods Act (India) 197 GlaxoSmithKline 178 Greenpeace v Plant Genetic Systems 23, 30 Green Revolution 62 Gujarat Grassroots Innovations Augmentation Network 181 Honey Bee Network 104, 180, 181 hoodia 52–53, 56, 57 Human Genome Sciences 16 Hybridoma technology 15 IACBGR (Inter-Agency Committee on Biological and Genetic Resources of the Philippines) 139, 141, 142 IARCs (International Agricultural Research Centres also see individual IARCs 7, 8, 40, 97, 146, 209 ICIPE (International Centre for Research in Insect Physiology and Ecology) Idris, Kamil 133 Incyte 16 INDECOPI (National Institute for the Defence of Competition and Intellectual Property of Peru) 118–120 India Agricultural Research Institute 183 Indian Institute of Science 181
Industrial Property Act, 1989 (Kenya) 212, 214, 216 Industrial Property Act, 2001 (Kenya) 214 insulin 3, 48 intellectual property rights see copyright, geographical indications, patents, trade marks, trade secrets, UPOV and utility models IPGRI (International Plant Genetic Resources Institute) 8, 70–71 InterAmerican Development Bank 105 International Centre for Agroforestry (ICRAF) 209 International Centre for Research in Insect Physiology and Ecology (ICIPE) 209 International Chamber of Commerce 111 International Fund for Agricultural Development 8 International Service for the Acquisition of Agri-biotech Applications (ISAAA) 216 International Treaty on Plant Genetic Resources for Food and Agriculture see also FAO and International Undertaking on Plant Genetic Resources 3, 39–41, 113, 153 relationship to CBD 39, 128 relationship to intellectual property 40–41, 68–69, 128 International Undertaking on Plant Genetic Resources see also FAO and International Treaty on Plant Genetic Resources for Food and Agriculture 3, 10, 39–40 Intertribal Agriculture Council 106 IRRI (International Rice Research Institute) 8 IUCN (International Union for the Conservation of Nature and Natural Resources) 143, 148 J.E.M. Ag Supply v Pioneer Hi-Bred 23 Jördens, Rolf 76 Kani people 180 Kayapó 96 Kenya Agricultural Research Institute 207, 208, 216
Index 255 Kenya Forestry Research Institute 207, 208 Kenya Industrial Property Office 212, 213 Kenya Marine and Fisheries Research Institute 209 Kenya Medical Research Institute 208–211, 217 Kenya Wildlife Service 207, 208 La Viña, Antonio 139–140 liability regime see also traditional knowledge 117–118 Lisbon Agreement for the Protection of Appellations of Origin and their International Registration 132 Lupin 176, 178, 179, 185 maca 50, 56 Madrid Agreement Concerning the International Registration of Trademarks 132 Maharishi Ayurvedic Products 185 Mashelkar, R A 175, 177 material transfer agreement 40, 113, 155 medicinal plants see also botanical medicines 3, 165, 169, 170, 171, 180, 185–186, 206, 210–211, 217 Merck 48, 178 Millennium Pharmaceuticals 16 Milpurruru v Indofurn Pty. 102 Ministry of Environment and Forests of India 180 Model Provisions for National Laws on the Protection of Expressions of Folklore Against Illicit Exploitation and Other Prejudicial Actions 132 Mooney, Pat 4, 54, 74 Monsanto 63, 119, 194, 216 M S Swaminathan Research Foundation 180 mutually agreed terms 46, 136, 139–140, 144–145, 150, 155–156, 160 National Association of Quinoa Producers 54 National Biodiversity Strategy and Action Plan 172 National Bureau of Plant Genetic Resources of India 183 National Chemical Laboratory of India 175, 176
National Environment Management Authority of Kenya 207 National Informatics Centre of India 201 National Innovation Foundation of India 181–182 National Institute of Immunology of India 175, 176, 178 National Museums of Kenya 207, 209 national sovereignty 5, 5–10, 13, 45–48, 142, 143–144, 147–148, 152, 153, 161 neem 53, 56, 173 Novartis 63 Novo Nordisk 179 Paris Convention for the Protection of Industrial Property 11–12, 84, 116, 132, 212 Pasteur, Louis 3, 14 Patent Act (Belgium) 111 Patent Act (UK) 212 Patent Cooperation Treaty 84, 132, 212 Patent Law Treaty 134, 135 Patents see also TRIPS and benefit sharing 12, 40, 45–51, 134, 200 and biodiversity 62–63, 65, 189, 202 and biopiracy 52–55, 56–59, 201 and biotechnology 15, 16, 17, 21–24, 28–30, 186, 195–197, 202, 212, 213 definition of 11 on DNA 21, 40, 152 economic justification 47–48 and essentially biologically processes 23, 24, 29–30, 152, 159, 189 on life forms 3, 21, 22, 23–24, 28–30, 48–49, 128, 130, 152, 159, 213 on microbiological processes 24, 28–29 on microorganisms 3, 21, 22, 24, 28–29, 188, 190, 212, 213 morality and ordre public 27–28, 76, 78, 128, 190, 212 on plants and plant varieties 3, 22, 23–24, 28, 29, 68, 152, 188–189, 212, 213 and technology transfer 83–87, 212 Patents Act (India) 186–188, 198, 212 Patents (Amendment) Act, 1999 (India) 188 Patents (Amendment) Act, 2002 (India) 111, 188–189
256 Intellectual Property Rights, Biogenetic Resources and Traditional Knowledge permanent sovereignty see national sovereignty Pfister 75 Philippines Executive Order 247 and its Implementing Rules and Regulations (Philippines) 138–142, 159–160, 161 Phyllanthus niruri 57, 180 Phytopharm 53 Pioneer Hi-Bred 75 plant breeders’ rights see UPOV Plant Breeders’ Rights Office of Kenya 214, 215 plant breeding 6, 14, 19, 20, 33, 36, 60–62, 75, 77, 113, 168, 177, 191–195, 206, 209, 215, 219–220 Plant Genetic Resources Working Group of Kenya 207 Plant Patent Act (USA) 23 plant variety protection see UPOV Plant Variety Protection Act (USA) 23, 77 plant variety protection seal model 72–73 Pod-Ners 54 polymerase chain reaction (PCR) 15 Posey, Darrell 124 Principles and Guidelines for the Protection of the Cultural Heritage of Indigenous Peoples 115–116 prior informed consent 46, 130, 135, 137, 139, 140, 142, 144, 149, 150, 151, 154–155, 156, 158, 159–160, 195, 200 Proctor, Larry 54, 55 PROMUDEH (Ministry for Promotion of Women and Human Development) 119 property rights 6, 117–118, 142, 147–148, 152, 159, 161 Protection of Plant Varieties and Farmers’ Rights Act (India) 189–190 Proteomics 8 Provisional Measure 2.186–16 (Brazil) 111–112 Pure World Botanicals 50 Quinine 56–57 Quinoa 53–54, 58 RAFI see ETC Group Ramos, President Fidel 139
Ranbaxy 176, 178, 179, 185, 198 rational drug design 8 recombinant DNA 14 Regime of Protection of the Collective Knowledge of Indigenous Peoples (Peru) 118–120 remuneration without ownership model 73 reserpine 180 res nullius 59 Resolution 1803 on Permanent Sovereignty over Natural Resources 5 RiceTec 108, 197 RNA interference 8 Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations 104 Roundup (glyphosate) 63 Roundup Ready 63 Sahai, Suman 175 San people 52–53 Science and Technology Act (Kenya) 208 Searle 119 Seed Association of India 172 Seeds and Plant Varieties Act (Kenya) 212, 213–214 Seeds and Plant Varieties (Plant Breeders’ Rights) Regulations (Kenya) 214 Semiconductor Chip Protection Act (USA) 26 Shaman Pharmaceuticals 19 Sharma, Manju 175 Shull, George 75 SPDA (Peruvian Society of Environmental Law) 119, 143 Stanford University 14 Stilton 106 streptomycin 48 technology transfer 82–87, 141, 145, 146, 149, 150–151, 158, 160–161, 173, 194, 216, 217 terminator technology see genetic use restriction technologies terra nullius 59 tissue culture 14, 18, 177, 184, 195, 209 trade marks 11, 32, 106–107, 108, 185, 197, 216
Index 257 trade secrets 11, 32, 105–106, 152 traditional knowledge 3, 12, 41, 91–124, 128, 129–130, 133–136, 137, 141–142, 147, 149, 151, 154, 155, 156, 157, 158, 159, 160, 161, 173, 179–182, 183, 189, 200–201, 202, 203, 210–211, 217, 220–221 commercial importance 19–20, 98–99 compensatory liability regime 122 and copyright 100–104, 130 database rights 120–121 defensive protection 110–117 definitions of 91–96 environmental benefits 99 and geographical indications 107 global biocollecting society 121–122 misappropriation regime 115–117 and patents 104–105, 110–117, 130, 181 and plant variety protection 107 positive protection 117–124 prior art databases 114–115, 136 and trade marks 106–107 and trade secrets 105–106, 130 and utility models 107, 109 Traditional Knowledge Digital Library 114, 136, 201 Trichopus Zeylanicus 180 TRIPS (Agreement on Trade-related Aspects of Intellectual Property Rights) see also WTO 4, 11–13, 25–32, 84, 86, 107, 112, 114, 114, 129, 153, 188, 189, 190–203, 212–218 Article 27.3(b) 24, 28–30, 70, 76, 127–128, 129 Article 39.3 121 copyright 101, 103, 104 Council for TRIPS 26, 31, 73, 127–130 Declaration on the TRIPS Agreement and Public Health 26 geographical indications 197–198 most-favoured nation 26 national treatment 26 objectives 26 patents 27–30, 173, 204 trade marks 32 trade secrets 32, 106 Tropical Botanic Garden and Research Institute 179–180, 183
Turkana 210 turmeric 50, 56, 57, 173 UNCTAD (United Nations Conference on Trade and Development) 123 undisclosed information see trade secrets UNDP (United Nations Development Programme) 8 UNEP (United Nations Environment Programme) 97 UNESCO (United Nations Educational, Social and Cultural Organization) 97, 132–133 unfair competition 116 United Nations Convention on the Law of the Sea 10 United Nations General Assembly 5 United States Trade Representative 189, 214 University of California at San Francisco 14–15 University of Mississippi 50 UPOV (International Union for the Protection of New Varieties of Plants) see UPOV Convention UPOV Convention 5, 10, 11–12, 13, 24, 29, 33–37, 39, 41, 76–77, 107, 128, 151, 189, 190, 191–195, 201–202, 204, 213–215, 218, 219–220, 221 and benefit sharing 12 and biodiversity 60, 61–62 and biopiracy 55–56 breeders’ exemption 35, 68–69 definition of 11, 34 and developing countries 66–68, 69–70, 87 and essentially derived varieties 35 farmers’ privilege 35–36, 67–68, 71, 189 value for cultivation in use 72 USDA (United States Department of Agriculture) 74, 77, 108 US Patent and Trademark Office 50, 57, 76–77 utility models 85, 107, 109, 213, 220 vitamin B12 48 Ward, Sarah 54 Wildlife (Conservation and Management) Act (Kenya) 208
258 Intellectual Property Rights, Biogenetic Resources and Traditional Knowledge Working Group on Indigenous Minorities of Southern Africa 53 World Bank 8, 97 WIPO (World Intellectual Property Organization) 25, 33, 112, 131–136, 190 General Assembly 135 Global Intellectual Property Issues Division see Traditional Knowledge Division Intergovernmental Committee on Intellectual Property and Genetic Resources, Traditional Knowledge and Folklore 134–136 Standing Committee on the Law of Patents 134
Traditional Knowledge Division 133–134 WIPO Performances and Phonograms Treaty 104, 132 World Forum on Folklore 133 W. R. Grace 53 WTO (World Trade Organization) see also TRIPS 4, 25, 127–131, 132, 169, 188, 190 Committee on Trade and Environment 130–131 Council for TRIPS see TRIPS Doha Ministerial Declaration 129, 131 Wynberg, Rachel 53 Zandu 185 Zoological Survey of India 172, 180
