People, Plants and Patents: the impact of intellectual property rights. Report of the

Crucible Group (1995).

 

EXECUTIVE SUMMARY

In the closing decade of the 20th century, changed political forces and the advent of new technologies, especially biotechnologies and informatics, have contributed to the development of a global marketplace. New technologies are an important consideration in both national development and international trade. This influence has driven a revolution in intellectual property (IP) systems. Innovation and research are a strong new presence in world affairs. Every country, South and North, will be affected by the new and integrated role played by IP in all aspects of development and the environment. For the South, in particular, the impact of IP on farmers, rural societies, and on biological (including genetic) diversity will be profoundly important.

Perhaps for the first time, policymakers and opinon makers dealing with trade, development planning, agriculture, and the environment must give careful consideration to the implications of intellectual property. Many will be surprised to find that IP decisions have major implications for national food security, agricultural and rural development, and for environmental conservation.
The purpose of this report is to identify key issues and choices and to describe the broader context within which decisions are being made. The full report contains 28 consensus recommendations that are clearly marked in appropriately titled boxes at the end of the sections to which they relate. (The recommendations are also summarized in this section in similar boxes.) In addition, the Group is including a number of other boxes titled "Different Viewpoints." In each case, three different opinions are expressed that represent the range of opinions expressed within the Group on the subject. Although we may not agree with one another, we do concur that each of the different opinions expressed could be considered by policymakers en route to decisions. We hope you find this unique summary of the major debating points helpful.

THE POLICY ENVIRONMENT

A number of factors are coming together to make intellectual property and biodiversity important issues for humanity. First, one of the most persistent and growing political realities of the past quarter-century is public awareness of environmental degradation. Although the "popularity" of environmental issues can be seen to wax and wane somewhat before and after major events, such as the Earth Summit of 1992 (the United Nations Conference on Environment and Development, UNCED), there is an intensifying awareness in global civil society that all is not well and that strong actions must be taken. We believe there is indeed cause for alarm and nowhere more so than for the food crops and medicinal plants that nurture us.
With the spread of environmental awareness, there is an increased understanding that biodiversity is also the biomaterial we need to overcome new dangers and to meet new opportunities. Greenhouse gases, climate change, and ozone depletion portend unpredictable shifts in disease patterns for people, livestock, and crops. Access to abundant genetic diversity will be the key to human survival. If diversity goes, we will soon follow.
Simultaneously, human genius and innovation are bringing about a remarkable revolution in the use of biomaterials. New biotechnologies can use biodiversity in ways it has never been used before. Although there are mixed opinions as to the ethics and safety of genetic manipulation, and how quickly products are coming to market, there is general recognition among policymakers and opinion makers that this is a new social and economic force to be reckoned with.
On the one hand, the world has a declining resource base of biomaterials and, on the other hand, a rising demand for, and competence with, biological (especially genetic) resources. This could seem to be a recipe for economic benefit and a clear case for conservation. The benefits of genetic conservation, however, are long term and rarely predictable. Commercial profit horizons are short term and depend on predictability. We cannot expect conservation to yield windfall rewards in the immediate future.
It is certain that no country has cornered the market on biodiversity. No country is even remotely self-sufficient in its needs for genetic resources. Genetic diversity is full of surprises. Some of the most biologically diverse regions in the world may depend upon much less diverse regions for some of their most important foods and medicines. The world needs a strong multilateral framework within which nation-states can manage their resources and negotiate their access.
These broad factors are brought into focus by the adoption of the new GATT accord and the coming-into-force of the Convention on Biological Diversity. Intellectual property is now firmly entrenched in the trade agreement, and continues to be a controversial topic on the biodiversity agenda. In this context of change and uncertainty, recent developments make it clear that IP is not a static mechanism for invention but a changing market mechanism that can significantly influence public- and private-sector relationships. It can also profoundly influence the well-being of rural societies. Governments, rural and indigenous communities, and industry must determine how to address the issue of IP. Intellectual property policies could set the framework for how we approach the conservation and development of biodiversity. In the absence of a convincing global morality, strong national policies are imperative. The general environment of concern and uncertainty lead to the Report's first major recommendation.

Sensing, on the one hand, a certain uncertainty and lack of understanding related to intellectual property regimes and, on the other hand, the opportunity to create a new covenant in support of wider innovative processes, the Crucible Group recommends that the United Nations convene an international conference on society and innovation. Now, and at this conference, policymakers must bear in mind that some people, countries, and cultures have deep ethical concerns about biotechnology and the concept of life patenting.


NURTURING DIVERSITY

The process that has brought about the Convention on Biological Diversity has served to highlight that rural and indigenous communities have both technical competence and knowledge needed to conserve plant genetic resources. Conservation strategies that begin with local communities have perhaps the best chance to work. The logical beginning point in the development of a practical, national conservation and enhancement program is the participation of communities in partnership with institutions in the formal sector.
It must be understood, however, that, for farmers, extinction can take place when seed leaves the field. That it is stored in a genebank is not necessarily a guarantee that farmers will ever see it, or its progeny, again. Conservation programs and genebanks must establish a new relationship with rural communities that guarantees farmers access to the germplasm they are prepared to share. At the same time, a conservation strategy must engage the private sector as well as public-sector institutions. Industry can make a constructive contribution. This gives rise to our second general recommendation.

The Crucible Group stresses the primacy of specific national conservation strategies for plant genetic resources that invite the participation of local communities as well as private companies. Holders of ex situ germplasm collections should develop equitable partnerships with indigenous and rural societies and make their collections available to them.

There is great hope that the Biodiversity Convention will become the cornerstone of a multilateral commitment to the equitable conservation and enhancement of biological diversity. There are two outstanding sets of issues that relate very closely. The first is the status of ex situ collections of biomaterials gathered before the Convention. Perhaps two-thirds of all crop germplasm now in storage is not in the country from which it was collected. Some Group members believe that if the Convention only safeguards that which we do not know to exist and do not know to have value, it will have failed to achieve one of its primary goals of linking biodiversity with development.
The second set of issues relate to Farmers' Rights (that is, a recognition of the rights of farmers to compensation for their contribution to plant genetic resources) and industry's concern that IP for biomaterials be protected. Some see the Convention as a kind of "fast GATT" for IP proponents. Others view the Convention as a sidetrack for IP opponents to pirate private research; hence, our third general recommendation.

The uncertainty regarding the status of ex situ biomaterial collections must be addressed in these early days of the Convention. Similarly, the Crucible Group recommends that the outstanding issues of Farmers' Rights and of IP be clarified. The Biodiversity Convention may find that the Fourth International Technical Conference on Plant Genetic Resources (Berlin, June 1996) offers the best negotiating process and forum for the resolution of these issues.


DIVERSIFYING INNOVATION

If the issue facing decision-makers is how to respond to a new trading environment that involves IP rules, the opportunity at hand is to rethink the place of innovation in a national and global context. In this era of the "information highway," the real challenge is to make it a two-way street that ensures the safety of passengers going each way. On one side, we have indigenous and other rural communities (the informal system of innovation) and, on the other side, we have public and private institutes of research (formal innovators). One side has a profound "macrobiological" understanding of their microenvironment. The other has a strong "microbiological" understanding of their macroenvironment. The task is to allow the two to cooperate without violating their rights or capacities. Farmers' fields and forests are laboratories. Farmers and healers are researchers. Every season is an experiment. Scientists should be partners. If we are going to conserve and develop diversity, these two systems need each other.
To become full partners in the innovation process, community innovation requires Germplasm, Information, Funds, Technologies, and Systems. These are the "GIFTS" that turn plant genetic diversity into a resource and a gift from generations of farming societies to generations yet unborn. This implies an obligation to farmers and some important prerequisites for an innovation policy.

The Crucible Group agrees that innovation strategies should promote decentralization, diversity, and democracy at all levels, rather than only promoting centralization, uniformity, and control. Current IP systems are ineffective in supporting community-level innovation.

If the community role is the new discovery in innovation, partnership must be the new motto. We must create the new covenant that allows all researchers to associate in transparent and equitable ways that support intellectual integrity. This includes the private sector. Any national program that does not seek to exploit the creative role of the private sector fails to capitalize on a vital opportunity.

The Crucible Group recommends the development of national innovation strategies for the use of biomaterials that are tailored to national needs and opportunities. The outstanding challenge is to create equitable policies and initiatives that facilitate collaboration between formal (public and private institutions) and informal (community) sectors. The creative contribution of private initiatives (cooperative or company) should not be neglected.


DIVINING THE TRADE OPTIONS

With respect to IP, the GATT agreement obliges signatory states to adopt either a patent or some form of sui generis (that is, of its own kind, constituting a class alone, unique, peculiar) IP system for plant varieties. Policymakers have a number of choices depending on their view of IP. Governments can adopt patent laws for plant varieties or they can take on either one of two forms of Plant Breeders' Rights (PBR) (the 1978 or the 1991 Conventions) under the Union for the Protection of New Varieties of Plants (UPOV). Alternatively, they can devise some other form of sui generis legislation, such as the United Nations Educational, Scientific and Cultural Organisation–World Intellectual Property Organization (Unesco–WIPO) Model Provisions on Folklore or Inventors' Certificates. Another option, in a fast-changing world, is to take advantage of the coming 4 or 5 years to monitor IP developments and make a policy decision sometime before the GATT provisions come under review.
It is important to realize that the GATT accord is a flexible document open to many kinds of interpretation. Much of the language is general in nature and there is an ambiguous provision for exemption for environmental reasons.
Among the many points of debate is whether or not the patent system is self-correcting or whether a larger segment of society needs to become a participant in the unfolding process. There are strong opinions on both sides of this debate. Other observers suggest that biotechnology may warrant its own sui generis IP system, such as those developed for computer software and integrated circuit technologies.

Under the pressure of possible exclusion from an encompassing global trade agreement, many countries feel pressed to adopt some form of IP protection for plant varieties. The Crucible Group concurs that compulsion is inappropriate and that countries, obviously, have every right to protect their environment and the well-being of their peoples if they feel that trade rules threaten their security.


Patents provide a very strong protection for inventors. Many observers believe that the patent system has the flexibility to adapt to changing circumstances, and that it will be the preferred system of protection for those developing new biotechnologies. Others believe that a system intended to protect light bulbs and sewing machines cannot readily be applied to living materials. Genes in plant varieties are particularly difficult to control, and some regard protection for genetic material to be extremely difficult to realize. Contrary to the understanding of some policymakers, GATT does not require patents for plant varieties. There is general agreement that the development of conventional plant varieties does not require patent protection.

The Crucible Group notes that it is not necessary to establish patent legislation for plant varieties to meet GATT requirements or the needs of plant breeders. It recommends that those pursuing a patent model ensure that the research exemption is strong and clear. It also advises that gene flows between plant populations are often uncontrollable and that patent regulation could prove difficult.

The Union for the Protection of New Varieties of Plants is a form of sui generis protection for plant varieties often known as Plant Breeders' Rights or Plant Variety Protection (PBR, PVP). Until 31 December 1995, any country may choose to join either the UPOV Convention of 1978 or the UPOV Convention of 1991. After 1995, the 1978 Convention will no longer accept new members, although states adhering to this version may remain and will still be recognized as member states of UPOV in good standing. The 1978 UPOV Convention allows governments to determine the species they wish to protect and ensures that farmers can save and exchange seed for the next growing season. The 1991 Convention requires that all plant species must be protected and does not permit farmers to save or exchange protected seed. Both models have advantages and drawbacks, depending on the country and the point of view. Presumably, governments could adopt legislation compatible with UPOV 1978 after 1995 and, although not joining UPOV, could still be in good standing with the international community and in keeping with the GATT agreement.
In general, the South is not a target for GATT's IP provisions for plant varieties. With exceptions, countries have both time and choices. Private companies are not interested in obliging small-scale farmers not to save company-protected seed for succeeding generations or even in preventing them from trading seed with their neighbours. Breeders will not prosper unless farmers do. Many companies believe that strong breeders' rights could increase genetic diversity and farmer security.

Another means of meeting GATT requirements is with the adoption of PBRs through either the 1978 or 1991 UPOV Conventions. The Crucible Group agrees that UPOV 1978 gives countries greater flexibility. Countries are advised that related seeds legislation, such as National Lists (regulating the quality of seed and range of varieties available to farmers), could have adverse effects in the presence of PVP.

There has been a distressing lack of innovative thinking about Innovation Systems. In leaving the door open to sui generis forms of IP for plant varieties, GATT invites industry, farmers, and governments to respond creatively.
This creativity is urgently needed. Intellectual Property systems have evolved within a certain legal and cultural context that renders their protection inaccessible to most informal innovators most of the time. There are also obvious economic and logistical barriers to the protection of indigenous knowledge. Intellectual Property Systems that do not make space for informal innovators are fundamentally inequitable. This shortcoming can lead to abuse and must be addressed.
Among the possibilities that could be considered are modifications to existing IP Systems that make way for community protection, including the development of public defenders within patent offices, gene-tracking databases, and review mechanisms that could bring some support to the informal sector. The WIPO–Unesco Folklore Provisions, first drafted in 1985, could possibly give communities rights over their evolutionary biological inventions for as long as they continue to innovate. This and other options could be pursued.
Because the various systems of IP are evolving, proponents and opponents should not make the mistake of denying the possibility of beneficial changes. Some opponents of IP, for example, might prefer a system without exclusive monopoly provisions. Various forms of licencing are also possible. There may be instruments available that would encourage innovation and, nevertheless, strengthen society's right and ability to use innovation.

The Crucible Group acknowledges that GATT requirements and the national need for an innovation strategy, or both, may be served through some form of sui generis legislation that may or may not involve IP. Given that states have several years to develop legislation under the GATT rules, the various options deserve closer study.

The CGIAR's International Centres find themselves in a unique position. The Centres hold an estimated 40% of the unique food-crop germplasm in ex situ storage in the world. These same Centres are the world's major distributors of enhanced germplasm for national (public and private) breeding programs in the South. The Centres also breed their own varieties, which they make available free to farmers in the South.
The Centres are caught in a dilemma. They believe that the germplasm they hold is theirs "in trust" on behalf of the world and, particularly, on behalf of developing countries. They wish to exchange breeding material as fully and freely as possible. Their material — about a half million germplasm accessions — was almost all collected before the coming into force of the Convention on Biodiversity. In a sense, the International Centres are "a-lateral" institutes caught between two "multilateral" accords (GATT and the Convention) that press governments to develop "bilateral" relationships for both the conservation and the use of plant genetic resources.
It is clear that the Centres must have open and well-defined policies to ensure that any benefit from direct exploitation of germplasm held by then in trust accrues to the countries that donate the germplasm. It is also important that Centres negotiate access to new technologies being developed in the North that could be of use in the South.

With respect to the status of ex situ collections, the Crucible Group welcomes the joint initiative of the Food and Agriculture Organization of the United Nations (FAO) and member institutes of the Consultative Group on International Agricultural Research (CGIAR) to establish an "in-trust" agreement for the benefit of developing countries. The Group further recommends that CGIAR's international centres establish a transparent IP policy that uses Material Transfer Agreements (MTAs) so that the benefits arising from the direct use of in-trust genetic materials accrue to the countries that donate the material. Holders of germplasm collections should also give serious consideration to the use of MTAs and to Defensive Publication provisions in some patent legislation that could help to ensure the secure availability of collections. The Group is concerned, however, that a trend toward bilateral germplasm agreements could undercut beneficial multilateral accords. There is a need to ensure strong multilateral mechanisms as umbrellas to bilateral arrangements.

 

 
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