MINISTRY OF AGRICULTURE FISHERIES AND FOOD
INTERNATIONAL UNDERTAKING ON PLANT GENETIC RESOURCES FOR FOOD AND AGRICULTURE
COMMERCIAL BENEFIT SHARING
25 NOVEMBER 1999
ROYAL BOTANIC GARDENS
INTERNATIONAL UNDERTAKING ON PLANT GENETIC RESOURCES FOR FOOD AND AGRICULTURE
WORKSHOP ON THE SHARING OF MONETARY BENEFITS FROM THE COMMERCIALISATION OF PLANT GENETIC RESOURCES FOR FOOD AND AGRICULTURE
A workshop was held on 25 November 1999 at the Royal Botanic Gardens, Kew to consider options for mechanisms for the sharing of monetary benefits from the commercialisation of plant genetic resources for food and agriculture (PGRFA) accessed under a revised International Undertaking.
A total of 9 possible options were identified. Six were considered in detail by the Workshop. The results of that consideration is summarised in the attached report. Some information and observations on the 3 options not considered by the Workshop are given in Annex I.
Please note that this report was prepared following the Workshop and was not discussed during the Workshop. It is therefore not binding on those who attended.
Sincere thanks to all those involved for their hard work both before and during the Workshop and to the Royal Botanic Gardens, Kew for providing the venue. Particular thanks to Kerry ten Kate (RBG, Kew) for her help in the preparation of the Workshop, and to Mike Ambrose (John Innes Centre) who was an admirable Chairman.
A list of participants is given in Annex II.
Further information about the Workshop and copies of the report can be obtained from:
Chief Scientists Group
Research Policy and International Division
Ministry of Agriculture Fisheries and Food
1A Page Street
London SW1P 4PQ
Tel: 0207 904 6906
Fax: 0207 904 6802
Professor Peter Crane (Director, Royal Botanic Gardens, Kew)
Professor Crane welcomed the participants to Kew. He noted the very constructive role the EU had played in the negotiations to revise the International Undertaking. Identifying pragmatic options for the sharing of commercial benefits was important to maintain the momentum of the negotiations. From this point of view, the Workshop was timely.
Kew had several hundred years of experience of access to plant genetic resources and benefit sharing partnerships in over 50 countries to draw on. Kew took the Convention on Biological Diversity extremely seriously and had in place a benefit-sharing policy before the Convention was signed. In June 1999 Kew had adopted the "Common Policy Guidelines for Participating Botanic Gardens" developed by 17 gardens from 15 countries and funded by the UK Department for International Development.
Kew's main interest was in wild plants, predominantly in sectors other than food and agriculture. Nevertheless, the revision of the International Undertaking was of considerable importance to them as an organisation dealing with in situ and ex situ conservation, with partnerships in many countries and depending for its science programme on access to genetic resources. They had followed the negotiations closely and hoped to contribute to the design of the Multilateral System, in which they hoped to participate.
Martin Smith (Ministry of Agriculture Fisheries and Food)
Martin Smith reminded the Workshop of the political background to the issue. The CBD had established the principles of national sovereignty over genetic resources and fair and equitable sharing of benefits. As a result, developing countries had certain expectations, including in relation to the sharing of monetary benefits from the commercial use of PGRFA. They were looking to developed countries to find ways to respond to this expectation.
To date, it had been difficult to find a practical and pragmatic solution which could sit properly within a multilateral system and which recognised the realities of plant breeding in the food and agriculture sector. In particular plant breeding for food and agriculture did not generate substantial profits when compared, for example, to the pharmaceutical industry.
The purpose of the Workshop was to examine and comment on a number of possible options to provide clear and useful information to policy-makers. There was no intention to give credence to any of the options under consideration. Policy-makers could well conclude, based on the results of the Workshop, that none of the options could form the basis of a solution. But equally, they might conclude that one or more of them was worth considering further.
Finally, he stressed that the results of the Workshop would have to be seen in the context of any wider package of commercial benefits to be shared and the balance which would need to be achieved between facilitated access and all elements of benefit sharing under the Multilateral System.
Kerry ten Kate (Royal Botanic Gardens, Kew)
Kerry ten Kate explained how the Workshop would be run. There would first be short presentations which would identify the main factors the Workshop would have to bear in mind in relation to the private sector (both patents and plant breeders rights) and the public research sector. The Workshop would then split in to 3 groups, each of which would consider two options. There were four objectives. For each option the groups were asked: to identify advantages and disadvantages; to refine, as necessary the description of the option; to indicate where further consideration was necessary to determine the relative merit of any of the advantages and disadvantages; and to identify any other issues for which further consideration was necessary.
Participants were asked to keep in mind the following questions when examining the options:-
What would be the trigger point for monetary benefit sharing?
Who would pay?
On what basis would payment be assessed?
Would tracking of accessions be necessary?
Should material protected by plant breeders' rights be treated in the same way as that protected by patents?
What would be the impact on the private sector?
What would be the impact on the public sector?
Would the option meet developing country concerns?
Was it practical?
How would it be administered?
Would the administrative burden/cost be acceptable?
Could the option be modified to make it more practical/acceptable?
Private Sector - Patents (Patrick Heffer, ASSINSEL)
Patrick Heffer explained that two types of patent situation should be considered - patents on biotechnological inventions, and patents on plant varieties. Patents, in comparison to Plant Breeders' Rights, had two particular characteristics relevant to the negotiations to revise the International Undertaking - there was a limited research exemption; and the farmer's privilege (particularly in relations to farm saved seed) was also restricted.
Patents on plant varieties were only issued in a restricted number of countries (USA and, to a lesser extent, Australia and Japan). In the USA, for example, this affected probably not more than 10% of protected varieties, the remainder being protected under plant breeders' rights. The reason for the use of patents was to obtain a stronger level of protection - in the USA plant breeders' rights were weaker than in many other countries, providing, for example, for no compensation in relation to farm-saved seed.
Currently, the 2 most widely used biotechnological inventions did not arise from the use of PGRFA and unadapted, exotic PGRFA was only rarely used in plant breeding programmes. Nevertheless, in the event of protection through patents (limiting free access to the new genetic resource) of material arising from the use of PGRFA held in gene banks or in situ, breeders were prepared to study a system in which the owners of the patents would contribute to an international fund established for implementing the Global Plan of Action.
Private Sector - Plant Breeders Rights (Greg Sage, British Society of Plant Breeders)
Greg Sage said that there was a very low level of exploitation of non-adapted parental material in conventional breeding programmes because of the time needed to select out unwanted traits. Low use of such material meant that there could only be a low yield of monetary benefits for sharing. Being at the base of the food chain, there was little value added. This was not the potential source of new funds for biodiversity which some seemed to believe.
The technical assumptions behind many proposals for monetary benefit sharing were based on 1960's technology and concerned accessions or phenotypes. Modern techniques, based on genomics, synteny or colinearity and chimeraplasty mean that even varieties protected by plant variety rights are, or shortly will be, selected at the molecular rather than the trait level.
Potentially a high number of genes of small effect could now be manipulated, as a consequence of modern techniques, which were not susceptible to the visual selection of conventional breeding. Multinational plant breeders therefore already had a wealth of, as yet untapped, diversity in their breeding programmes.
Plant breeders were in favour of the International Undertaking not because they needed the genetic resources at the technical level, but because they wanted to be seen to be part of a responsible society. However, if the Multilateral System were overly bureaucratic or too costly, breeders would ignore it.
Public Sector Research (Eva Thorn, Director, Nordic Gene Bank)
Eva Thorn said that national/regional gene banks or ex situ collections should contribute to the Multilateral System in the form of material and knowledge, but not money. Inputs in kind through participation in world-wide networks could be further developed. As an alternative to monetary contributions, gene banks could develop additional services to benefit developing countries including co-operation with the private sector to multiply and distribute seed or base-broadening activities with material being made available to developing countries.
The use of Material Transfer Agreements (MTAs) as a mechanism to collect monetary benefits could place unacceptable administrative burdens on gene banks and other public institutions. Other methods should be considered. For example, databases developed by gene banks to register exchange and transfer of accessions could be used instead of MTAs.
Gene banks could not be used to police benefit sharing arrangements.
It was often impossible to identify the country of origin of pre-CBD material held in gene banks, even if details of the donor were available, because the donor may not have been situated in the country of origin..
Plant breeders were often unwilling to deposit registered varieties in national gene banks. Arrangements should be made to ensure that this should happen, perhaps through national legislation.
A number of general observations were made during the course of the Workshop:
Option 1: A Levy on Accessions
Under the IU a small charge could be levied each time material within the Multilateral System was accessed from ex situ collections. An MTA would be created on each occasion material was accessed, with a copy being sent to a central body. Every 12 months that body would bill each organisation that had accessed material based on the MTAs received.
Further Work to be Done
Option 2: A Fee Payable by Participants in the Multilateral System
An annual fee could be raised from all institutions within the jurisdiction of Contracting Parties that hold or use PGRFA to allow them to participate in the Multilateral System, the International Network of PGRFA or the World Information Network. The fee might be differentiated according to the legal nature of the institution (public, private), its activity (conservation, research, breeding/commercialisation of seeds) and, regarding the latter, according to their size (small, medium, large, multinational). In addition, a distinction could be made regarding location (developing, developed countries). Governments could pay the fee on behalf of institutions within their jurisdiction. All institutions for which a fee had been paid would be listed. If no fee was paid, an institution would not be allowed access to material within the Multilateral System. (See also the MUSE study of IPGRI).
Further Work to be Done
Option 3: Negotiated Royalty Payments
A requirement of the MTA would be that where a product derived from material accessed under the Multilateral System was protected by an intellectual property right (plant variety rights, patent), the owner of the protected material would be required to negotiate with the country of origin of the PGRFA over monetary benefit sharing before commercialisation. The negotiation could be concluded at any time before the derived product was marketed, including at the time of access on a "just in case" basis. The recipients of such benefits and the use to which such money could be put may be subject to the national legislation of the country of origin. Where the country of origin was not known, a fixed percentage of royalties would be paid into the Funding Strategy of the IU (Article 16).
Further Work to be Done
Option 4: Voluntary Contributions by Parties
A key element of the IU is the need for secure, substantial and on-going money for conservation purposes. Part of it could be covered by voluntary contributions by Government. This might create an unwritten "special" position for Parties that contribute.
Further Work to be Done
Option 5: Fixed Royalty Payments
All material accessed under the Multilateral System would be subject to a legally binding MTA containing, inter alia, conditions regarding any resultant commercialisation. One condition would be that a fixed percentage of royalties would be payable into the Funding Strategy whenever the use of PGRFA resulted in a product which was protected by IPR, where that protection prevented free use of the product for further breeding. The share of royalties payable would be the same whether or not the product was developed using one or more accessions from the Multilateral System. (See also ASSINSEL proposal at Annex III)
Further Work to be Done
Option 6: Contributions to and participation in Multilaterally Financed Projects on Conservation and Sustainable Use of PGRFA by the Private Sector
Private sector entities would be invited/encouraged to participate in and contribute to projects on conservation and sustainable use of PGRFA in developing countries financed from multilateral funding sources. Financial benefits generated by such projects would be shared between the participants on mutually agreed terms. The international funding mechanism would have to allow for private sector participation in and co-funding of such activities. To avoid the Multilateral System becoming a bilateral arrangement on benefit sharing, part of the financial benefits would be allocated to the Funding Strategy of the Multilateral System.
Further Work to be Done
OPTIONS NOT CONSIDERED IN THE WORKSHOP
Option 7: Annual Contributions to the Funding Strategy
Developed countries to make annual contributions to the Funding Strategy established under Article 16. The total amount to be set in relation to the number of crops included in the Multilateral System (e.g. $X million for each crop), with individual country contributions based on the UN Scale of Assessment. (see latest draft of Article 14.2(d)(ii))
Option 8: Annual contributions to the funding strategy based on the value of crops produced
All countries to make annual contributions to the funding strategy in Article 16 calculated as a percentage of the value of the crops produced in their territories. The crops concerned will be those included in the Multilateral System and for which IPR protection has been sought. (see latest draft of Article 14.2(d)(i))
Option 9: Partnerships
One country has suggested that the development of partnerships between commercial enterprises and developing countries would ensure that both in-kind and monetary benefit sharing was appropriately dealt with. This received a cautious welcome from some developing countries, subject to examination of specific proposals. No specific proposals have yet been made.
Questions to be answered
Jan Borring Norway
Fabrizio Grassi Italy
Luis Gusmao Portugal
Wilbert Himmighofen Germany
Geert Kleijer Switzerland
Andree Sontot France
Mirja Suurnakki Finland
Peter Vermeij Netherlands
Private Sector Representatives
Guy Coudert GNIS, France
R Habgood Nickerson Seeds UK
Patrick Heffer ASSINSEL
Sue Kennedy Elsom Seeds
Greg Sage British Society of Plant Breeders
Public Sector Representatives
Mike Ambrose John Innes Centre
Cary Fowler IPGRI
J L Gal INPI, France
Kerry Ten Kate Royal Botanic Gardens, Kew
Roger Smith Royal Botanic Gardens, Kew
Prof. Straus Max Planck Institute
Eva Thorn Nordic Gene Bank
UK Government Representatives
David Boreham Plant Variety Rights Office
Linda Brown Department for International Development
Jane Bulmer Department of the Environment, Transport and the Regions
Peter Button Plant Variety Rights Office
Giorgia Curry Ministry of Agriculture, Fisheries and Food
Liz Peri Department for International Development
Martin Smith Ministry of Agriculture Fisheries and Food
Jonathan Tillson Department of the Environment, Transport and
Jose Esquinas-Alcazar FAO Commission for Genetic Resources for
Food and Agriculture
A Multilateral Agreement for Plant Genetic Resources for Food and Agriculture (PGRFA)
An ASSINSEL Viewpoint
Farmers, breeders and scientists have traditionally relied on open access to genetic resources, including improved commercialized varieties protected under the UPOV Convention. Since the entry into force of the Convention on Biological Diversity (CBD) there is evidence that the principles of the sovereign rights of nations over their genetic resources and of benefit-sharing, in the absence of an international agreement, are leading to growing restrictions on the exchange of genetic resources. This is, at present, and will certainly be, in the short and medium terms, far more damaging to public research, small breeding companies, and developing countries poor in genetic and financial resources, than to large countries and medium and large seed companies.
In addition, this state of affairs is less worrying for commercial plant breeders, because:
Nonetheless, ASSINSEL considers that, from a public interest point of view, the current state of affairs is detrimental to the maintenance of genetic resources, and considers it paradoxical that the entry into force of the CBD has been counterproductive in this regard.
ASSINSEL also considers that the Global Plan of Action on Plant Genetic Resources for Food and Agriculture, adopted unanimously in Leipzig in June 1996, was a step in the right direction and that its implementation will require the establishment of a multilateral agreement among countries on access to PGRFA and the equitable sharing of the benefits arising from their use.
One of the conditions for the acceptance of such a multilateral agreement is the confirmation of the fund provided for by FAO Resolution 3/91, in order to implement farmers' rights, fund which will support PGRFA conservation and utilization programmes.
Among the many obstacles in the international discussions, two in particular regard plant breeders: farm-saved seed and the "appropriation' of biodiversity. As a contribution to facilitating progress, breeders consider that:
As far as farm-saved seed are concerned, article 15 of the UPOV Convention clearly states (i) that the breeder's rights shall not extend to acts done privately and for non-commercial purposes and (ii) that each contracting party [to UPOV] may, within reasonable limits and subject to the safeguarding of the legitimate interests of the breeder, restrict the breeder's rights in relation to any variety in order to permit farmers to use for propagating purposes, on their own holdings, the product of the harvest they have obtained by planting on their own holdings [a] protected variety.
That clearly means that subsistence farmers are not affected by plant breeder's rights, and that it is obviously wrong or misleading to say that UPOV and UPOV-like systems impact on their liberty.
As far as commercial farmers are concerned, each country or block of countries has the possibility of finding solutions adapted to their particular socio-economic circumstances within the provisions for possible exceptions in the UPOV Convention.
In addition, it must be stressed that farmers would continue to have the choice between protected and unprotected varieties, as well as the possibility of saving, using and selling seed from unprotected varieties.
With regard to the "appropriation" of genetic diversity, ASSINSEL considers that, in the case of UPOV or UPOV-like systems, which represent the vast majority of protection titles in the world, there is absolutely no appropriation of genetic diversity, insofar as:
In the case of patenting, the situation is slightly different even if, as in the case of plant breeders' rights, the words "appropriation of biodiversity" are greatly exaggerated.
In line with their socio-economic development, it is now possible in a few countries - mainly in the USA but also in Australia and Japan - to patent plant varieties. In most countries, it is also possible to patent biotechnological inventions, when stringent criteria have been met. Plant breeders need strong protection, and consider that patent protection, when available, is justified and legitimate. As in the case of plant breeder's rights, the protection concerns a specific cultivar and/or a specific trait, for a limited period. It is therefore not justified to speak of the appropriation of biodiversity. However, there is a difference between patents and plant variety protection (PVP) since, contrary to varieties protected by PVP, the new improved patented material is not immediately available for further breeding and, therefore, is not available for immediate benefit sharing. For this reason, ASSINSEL members are ready to study the possibility of balancing the resulting lack of immediate availability by participating, when the results of a breeding/research programme. which includes genetic resources provided by in situ or ex situ gene banks arc patented, in the fund to be established by governments, as decided in FAO resolution 3/91, and implicitly acknowledged in the Global Plan of Action.
Such financial participation should be based on the material transfer agreement provisions of a multilateral agreement on PGRFA.
In the light of the above considerations, ASSINSEL recommends the establishment of a Multilateral Agreement on Access to Genetic Resources for Food and Agriculture and the Equitable Sharing of the benefits arising from their use.
The scope of the agreement should include all genetic resources of importance to present and future food security, and agriculture in general, at the level of genera and species: food crops, including vegetables and fruits, forage crops, and mixed industrial/food crops, For each genius and species, the genetic resources should comprise wild relatives, landraces, obsolete varieties, and commercial varieties that are in the public domain. (For the list of genera and species, see CGRFA/UND/4, Rev, 1, pp. 40-43).
The agreement should include pre- and post-CBD, and in situ and ex situ, collections. (The inclusion of the pre-CBD collections is acceptable only if the other principles contained in this document are accepted).
For maximum practicality, all materials covered by the agreement should be "freely" available, under similar terms of access, recognising that "free access" does not mean "without cost". In addition, in the case of in situ collections, in particular of wild relatives, the country of origin should facilitate the organization of collecting missions, on mutually agreed terms.
The Material Transfer Agreement (MTA) should include the following provisions:
In addition to the multilateral agreement, bilateral agreements should be possible in exceptional cases: bilateral approaches may be more appropriate, for instance, when a small number of countries have, or need, access to genetic diversity of a particular species or group of species, and/or when highly costly and specialized research gives a strong competitive advantage to a single institution or limited number of institutions. Such conditions may prevail in the case of certain industrial crops, such as, for example, rubber.
For these reasons, ASSINSEL, whilst preferring a broad multilateral agreement, acknowledges the necessity to keep open the possibility of bilateral agreements. However, any such bilateral agreements should be established according to guidelines defined within the overall framework of the multilateral agreement.