Update on the Nagoya Protocol and its EU implementation

Posted On 17 Nov 2016
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de-jong_pictureby Philippe de Jong*

BRUSSELS, Belgium: The Nagoya Protocol, signed in 2010, aims to ensure that the country of origin of the planet’s genetic resources, gets a fair share of the benefits of that resource when it is researched or developed. This article provides a description of the current state of the international protection of genetic resources.

Let’s start with some background. In 1992, a specific convention on biodiversity, called the Convention on Biological Diversity (CBD), was adopted. The CBD’s main objectives were to ensure that (i) the planet’s genetic resources (i.e. essentially all natural biological material, including material of plant origin) remained sufficiently conserved, (ii) they would be used in a sustainable manner, and (iii) the benefits arising out of their utilisation would be fairly and equitably shared with the countries providing those genetic resources. To achieve those objectives, the CBD legally enshrined the principle that Parties to the CBD have sovereign rights over their own natural resources.

The CBD also recognized the importance of traditional knowledge associated with such genetic resources.

Lengthy process

A lengthy process of further discussions then followed on how the CBD could be given more power, eventually led to the adoption, on 30 October 2010, of a supplementary agreement to the CBD, the Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilisation (Nagoya Protocol).

Under the Nagoya Protocol, which particularly seeks to strengthen the third objective of the CBD (i.e. the fair and equitable sharing of benefits arising from the utilisation of genetic resources), Parties can implement rules on access to genetic resources and on the sharing of benefits arising out of their utilization. Access is regulated by means of a requirement for prospective users of genetic resources to obtain prior informed consent (PIC) from the competent national authority, whereas benefit sharing is regulated through private law contracts between the user and the country of origin, referred to “mutually agreed terms” or “MAT”.

Finally, the Nagoya Protocol urges its members to implement a system of checks to make sure that the local rules on access and benefit sharing have been complied with.

The Nagoya Protocol entered into force on October 12th 2014. In the meantime, 80 Nagoya Protocol Parties have ratified the Protocol, the most recent ratifications emanating from Belgium (on August 9th 2016) and Bulgaria (on August 11th 2016). According to the CBD website, the goal is to reach 100 ratifications by the time the second Conference of the Parties (COP) to the Nagoya Protocol is held in December 2016 in Cancun, Mexico.

In the European Union (EU), the development of access and benefit-sharing rules has been left to the Member States. Pursuant to the rules of the CBD, they have sovereign rights over their respective genetic resources.

The EU, however, has implemented the compliance pillar of the Nagoya Protocol. To do so in a harmonised manner, it has developed a specific Regulation in that regard, officially called “Regulation 511/2014/EU of the European Parliament and the Council of 16 April 2014 on compliance measures for users from the Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilisation in the Union” (the Basic Regulation).

The Basic Regulation has been complemented with an Implementing Regulation. In addition to those two legislative instruments, the European Commission, in August 2016, also adopted a non-binding horizontal guidance document further explaining the scope and the core obligations under the Basic Regulation (the Horizontal Guidance). Finally, seven vertical guidance documents are being prepared on the notion of ‘utilization’ per sector affected by this new legislation (the Vertical Guidance), including one for the plant breeding sector.

Horizontal and Vertical Guidance

CIOPORA has actively participated in the stakeholder meetings that were held in preparation of the Horizontal Guidance. It is furthermore represented by three delegates, including myself, in the expert group assigned with the development of a draft Vertical Guidance document. Although CIOPORA supports all three objectives of the CBD, including the need for benefits arising out of the use by private entities of a country’s natural resources to be somehow shared with that country, it is also wary that an overly broad interpretation of some of the key terms in the Nagoya Protocol and the EU implementing rules on compliance does not hamper innovation in the ornamental plant breeding sector. This concern applies in particular to the notions of ‘genetic resources’ and the ‘utilisation’ thereof.

Since the guidance given in respect of these terms in the Horizontal Guidance is still somewhat ambiguous, CIOPORA continues to support a practical and feasible interpretation of these terms in the Vertical Guidance, which it believes to also be in line with both the text and the spirit of the Nagoya Protocol.

Breeder’s exemption

In respect of the type of genetic resources covered by the obligations of the Nagoya Protocol and the EU compliance rules, CIOPORA has, supported by many other stakeholders, taken the view that this should not relate to commercially available material of cultivated plant varieties, since these are not natural resources over which Nagoya Protocol Parties can exercise sovereign rights.

At the very least, the EU compliance rules should not impose due diligence obligations in respect of a third country’s access and benefit sharing legislation claiming sovereign rights over commercial varieties, as this would neither be appropriate or proportionate, as required by the Nagoya Protocol. Having the due diligence obligation apply to commercial varieties used as starting material in a breeding process would, in the opinion of CIOPORA, furthermore run counter with the breeder’s exemption under plant variety rights law, although this latter concern is not shared by the Commission in the Horizontal Guidance.

Clearly, a Nagoya Protocol Party can impose benefit sharing obligations in respect of commercial varieties developed through the use of an accessed natural resource in the MAT concluded with the prospective user. However, such obligations are part of the private contractual relationship between the provider country and the prospective user. It is not a matter to be checked by the competent national authorities under the due diligence obligations of the EU compliance rules, which are limited to a formal check of the existence of PIC and MAT, and do not provide for means to enforce their content.

In respect of the type of activities that amount to utilisation, which is defined in both the Nagoya Protocol and the EU compliance rules as ‘to conduct research and development on the genetic and/or biochemical composition of genetic resources, including through the application of biotechnology …’, it is the position of CIOPORA that this is only the case for activities that involve both research and development, i.e. activities of experimental development. Activities consisting of the screening of biological material in the wild or in genebanks to find interesting traits, assessing a material’s breeding value or the use of pathogens to find resistance genes, are not and should not be covered by that notion.

Workshop Brussels

CIOPORA’s representatives defended this position during a workshop on the draft Vertical Guidance which was held at the European Commission in Brussels on September 20th 2016. However, it is eventually up to the Commission to decide on the content of the Vertical Guidance. Given the uncertainty surrounding these issues, it is also expected that some of them will be addressed during the second COP in Mexico in December 2016. Reports on these developments will be provided in the periodical updates in the CIOPORA newsletter.

Read more in FCI’s Guide to Plant Breeder’s Rights http://www.floraculture.eu/digizine/oct2016/magazine.html

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