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Conference 6 - Background

The impact of intellectual property rights (IPRs) on food and agriculture in developing countries

1. The concept of IPRs

Firstly, a few words about the concept of IPRs in general. IPRs are intangible rights which grant an exclusive right to impede others to freely exploit an invention or creation. Different forms of IPRs exist such as patents, trademarks, industrial designs or copyrights. Each form of IPRs has different requirements and grants different rights.

For example, patents are granted on inventions which are novel, inventive, with a useful application and sufficiently described to allow verification. Some things may not be patented, such as discoveries. Patents are granted for a limited time period, usually 20 years, and are only valid in the country where they have been granted. Registered trademarks also have national coverage and the time limit of the rights may be extended. Plant variety protection provides protection to new plant varieties that have not been previously commercialised, that are distinct from existing varieties, that are uniform in their main characteristics and stable over the years for those characteristics. Unlike patented material, protected varieties can be used for the development of new varieties without the authorisation of the rights holder.

IPRs in general, and the patent system in particular, were established originally as a way to reward creativity and promote innovation. They allow the holder of the rights to recoup the investment in research required to develop the new invention, which can be quite substantial for high technology inventions and, in exchange, society receives the benefit of the disclosure of the new invention.

2. IPRs in the field of biotechnology for food and agriculture

Before the whole range of possibilities offered by modern technologies in the agricultural sector were available, inventions based on living organisms were considered natural phenomena, i.e. discoveries, and were thus not patentable. However, developments in modern biotechnology require substantial levels of investment in research and development, and its processes and products can be easily copied. The IPRs system provides a way of ensuring the financial revenues required to make the technology profitable.

In 1980, the United States Supreme Court made a landmark decision in the Diamond versus Chakrabarty case. The ruling stated that a live, human-made, genetically engineered bacterium (of the genus Pseudomonas, that was modified to break down components of crude oil) could be patented, thus initiating an era of massive private investment in biotechnology and of rapid expansion in the patenting of new biotechnological innovations and products. Many biotechnology companies and universities have since applied for and been granted patents on a wide range of biotechnology processes and products, involving genes, viruses, bacteria and even living higher organisms.

While the positive impact of the IPRs system on investments in research is not in question, concerns have been raised regarding the following issues:

a) The limits of patentability

The difference between invention and discovery becomes a matter of interpretation when it refers to living material. The isolation of a gene from its natural environment and the identification of its function render the gene and its sequence an invention for patenting purposes in some countries. The impact of patenting of genes in the agricultural sector cannot be minimised and should be discussed in this conference.

b) Patenting of "enabling technologies" (i.e. technologies that are essential for the practical implementation of a wide range of other biotechnological processes and products)

This issue is of great importance as it has an impact on access to these technologies, not only by developing countries but also by the agricultural research system in general.

c) The multiplicity of patents required to develop an agricultural product

This complicates management of the research agenda. Developments in modern agricultural biotechnology require the use of several processes and products, which in most cases will be subject to patent protection. As an example, let us consider development of genetically modified (GM) crops. Firstly, individual genes, affecting characters of interest such as disease resistance or herbicide tolerance, are patentable. Secondly, DNA sequences controlling the expression of these genes, such as promoters, may also be patented. The two methods most widely used for transferring foreign DNA, as well as methods for identifying plant cells that have successfully incorporated the foreign genes, are also patented. Thus, many steps of patented technologies are required for the development of a product in the field of agricultural biotechnology.

An example illustrating the complexity of IPRs is "golden rice", a rice plant into which three foreign genes (two from the daffodil and one from a bacteria) have been introduced so that it produces provitamin A. The plant variant was produced by researchers collaborating in Switzerland and Germany and there is large interest in making it available to farmers in developing countries. However, the number of concurrent patents has complicated this possibility. Seventy techniques and materials used in developing the variant are patented, and they are owned by 32 different parties.

d) Patents on specific genes usually extend to the GM organisms into which the genes are inserted, thus bringing the entire organism under patent protection.

This question has raised considerable debate in the crop sector. Eventual financial revenues are granted to the patent holder, without compensating the developers of the original plant variety. In some cases, however, particularly when the original plant variety is protected through plant variety protection, sharing of benefits is achieved on a contractual basis with the patent holder.

e) Concentration of the agricultural industry

Another important element in this discussion is that a small number of multinational companies (MNCs) dominate the field of agricultural biotechnology. Companies from developed countries therefore own many of the important IPRs in this area, and the power that this provides is concentrated in very few hands. For example, it is reported that of the roughly 270 patents related to genes of the soil bacterium Bacillus thuringiensis (Bt) granted from 1986 to 1997 in countries of the Organisation for Economic Co-operation and Development (OECD), about 60% were owned by only six MNCs. As the development of biotechnology products requires the use of many protected technologies, the private sector usually overcomes this problem by cross-licensing their patents, involving the mutual exchange of access to patented products or processes without financial compensation. For small organisations that do not have IPRs to trade, licensing negotiations may be difficult and costly.

From discussions during Conference 1 of the Forum (entitled "How appropriate are currently available biotechnologies in the crop sector for food production and agriculture in developing countries"), it was apparent that many participants were convinced that the impact of IPRs on agricultural biotechnology in developing countries was quite substantial. Some of the potential consequences mentioned by participants were:

a) Increased dependency of developing countries on developed countries:

The point was made that the existence of strong IPRs, and the fact that the rights over the technologies and products are often owned by MNCs, might lead to (increased) dependence by developing country farmers on MNCs and developed countries.

b) Patenting of genetic resources native to developing countries:

Patents can and have been issued to companies from developed countries over genetic material from developing countries, particularly for pharmaceutical and cosmetic purposes. In some cases, the lack of appropriate mechanisms for sharing of benefits has generated considerable controversy. A much-cited example is that of the neem tree (Azadirachta indica), which is a member of the mahogany family and which is indigenous to the Indian subcontinent where it has traditionally been used for agriculture, medicine and cosmetics. Around 90 patents exploiting the tree have been granted world-wide. In some cases, patents have been granted for particular uses, which are already known by traditional indigenous communities, not fulfilling the novelty requirement. Following a legal challenge, the European Patent Office in May 2000, revoked one of the patents (number EP0436257), granted to an American MNC and the United States Department of Agriculture, on a neem seed extract with insecticide and fungicide properties on the basis of its lack of novelty. Patent litigation costs are high and are an important factor in deciding whether to challenge such patents.

A more detailed summary of what the participants said can be found in the Summary Document of Conference 1http://www.fao.org/biotech/logs/C1/sum.htm.

3. Factors that should be discussed in this conference

The main topic of this e-mail conference is the impact of IPRs (over biotechnological products and processes) on food and agriculture in developing countries.

The following areas should be considered during the conference:

  • What are the impacts of IPRs (positive or negative) for food and agriculture in developing countries
  • Compare the relative impacts in the animal, crop, fishery or forestry sectors
  • Are the impacts different for different countries or regions of the developing world
  • Are the impacts more substantial for some biotechnologies than for others
  • If some of the impacts or consequences are negative for developing countries, how can they be avoided or alleviated

Whether the lack of an appropriate or harmonised IPRs system in a developing country can have an impact on biotechnology transfer

NB: When submitting messages (which should be no more than 600 words), participants are requested to ensure that their messages address some of the above elements.

Summary (short)

Conference 6 of the FAO Electronic Forum on Biotechnology in Food and Agriculture was entitled "The impact of intellectual property rights (IPRs) on food and agriculture in developing countries". It ran from 20 March to 14 May 2001.

The Summary Document provides a summary of the main arguments and concerns discussed during the conference, including:
- Companies from developed countries patenting genetic material from developing countries
- Impact on agricultural research
- Whether IPRs favour the interests of developed countries and the biotechnology industry over those of developing countries
- Avoiding or alleviating the negative impacts of the current IPRs system
- National IPRs legislation in developing countries


I. Summary Document (Short Version) - Conference 6

The sixth conference of the FAO Electronic Forum on Biotechnology in Food and Agriculture was entitled "The impact of intellectual property rights (IPRs) on food and agriculture in developing countries" and it ran from 20 March to 14 May 2001. A total of 265 Forum members registered and 50 messages were posted during the 8-week long conference. Roughly two thirds came from participants in developed countries and one third from developing countries and they were posted by 30 individuals from diverse walks of life (e.g. research institutes, NGOs, private industry, patent lawyers) in 18 different countries.

Throughout the conference, the crop sector received far more attention than the other agricultural sectors while the kinds of IPRs specifically discussed were patents and, to a lesser degree, plant variety protection (PVP). In addition, genetic modification was the biotechnology that participants singled out for particular attention.

The messages covered a wide range of subject areas. In general, most participants seemed to consider the impacts of IPRs to be primarily negative for the developing world. Their comments on the impacts or consequences of IPRs can be grouped into three major themes:

1. The patenting of genetic material from developing countries by companies from developed countries:

From the messages posted, this seems to be one of the most controversial consequences of the current IPRs system and some participants expressed strong frustration and anger about this situation. These strong reactions stemmed from the perceived
a) appropriation of the resources in developing countries by parties in developed countries (cases, such as the recent granting of a patent involving the Nuna bean, were discussed)
b) lack of adequate mechanisms to prevent it happening
c) failure to acknowledge the contribution made by farmers in developing countries to the genetic resources
d) failure to share the benefits with farmers in developing countries

Other topics discussed here were the definition of what is patentable, the difference between discovery and invention and the potential role of relevant international agreements (such as the Convention on Biological Diversity).

2. The impact on agricultural research

Participants suggested that IPRs had influenced (generally in the negative sense):

a) the quality of agricultural research carried out (e.g. due to reduced flow of knowledge/material between potential research partners or research
projects being abandoned because of insufficient "freedom to operate")
b) the nature of research collaborations between the public and private sector (i.e. in the context that private sector research (stimulated by IPRs) is increasingly important and that public-private sector partnerships are more frequent)
c) the nature of research collaborations between developing and developed countries (e.g. the traditional system of sharing research benefits between developed and developing countries is changed).

3. Whether IPRs favour the interests of developed countries and the biotechnology industry over those of developing countries

Some of the arguments considered here, which were occasionally quite political, included
a) whether the very nature of the current IPRs system discriminated against (or, even, allowed the exploitation of) developing countries because it places a greater value on biotechnology outputs than on genetic resources used to create the biotechnology products
b) who owned patents in developing countries and the implications of developing countries harmonising or introducing national IPRs legislation.

In the conference, participants also discussed how these negative impacts or consequences could be avoided or alleviated. They seemed to have two different approaches. The first was to call for a reassessment of the current IPRs system and to propose alternative systems that, for example, were weighted more towards developing countries interests or that were compatible with farmers' rights or did not allow legal ownership of life forms. The second was to accept the current system (even though they might consider it to be unjust) and, instead, to seek strategies to minimise its negative impacts. These strategies included the pooling of IPRs held by the public sector into an IPRs portfolio to serve poor farmers; applying IPRs legislation in a way that minor or trivial inventions could not be patented, useful follow-on research could not be restricted and challenging of invalid patents would be easier; encouraging governments in developed countries to stimulate their universities, research institutes and private companies to share their biotechnology products and processes with developing countries free of charge and, finally, when appropriate, getting private companies to provide biotechnology products at a reasonable price to developing countries.

Some other topics raised in the conference were the implications of the WTO agreement on Trade-Related Aspects of Intellectual Property Rights (the TRIPS Agreement); infringement and enforcement of IPRs legislation in developing countries; the consequences of a biotechnology product being developed using many patented biotechnologies; PVP versus patenting and, finally, patenting in the livestock sector.

Summary (long)

The sixth conference of the FAO Electronic Forum on Biotechnology in Food and Agriculture was entitled "The impact of intellectual property rights (IPRs) on food and agriculture in developing countries" and ran from 20 March to 14 May 2001. The importance of this topic was evident from previous Forum conferences, in particular from Conference 1 (on the crop sector) and, to a lesser degree, Conference 5 (on hunger and food security). Participants in these conferences highlighted the negative impacts IPRs might have for developing countries, such as their increased dependency on developed countries, increased "bioprospecting" in developing countries, reduced technology transfer and reduced ability of developing countries to produce their own biotechnology products. This sixth conference made it possible, therefore, for a deeper discussion of these issues to take place.

A relatively large number (265) of Forum Members registered for the conference and 50 messages were posted over the 8-week period, covering a wide range of themes concerning IPRs and their impacts on developing countries. The majority of participants considered the impacts of IPRs to be primarily negative for the developing world. They seemed then to have two approaches to deal with the situation. The first was to reject the current IPRs system that they consider to be wrong and unjust and to propose how it should be changed. The second approach was to accept that the current system is here to stay and to propose strategies to overcome or alleviate the problems associated with it.

Throughout the conference, the crop sector received far more attention than the other agricultural sectors while the kinds of IPRs specifically discussed were patents and, to a lesser degree, plant variety protection (PVP). In addition, genetic modification was the biotechnology that participants singled out for particular attention. This is probably because, as Srinivasan (7/5) pointed out, impacts of IPRs are more substantial for modern biotechnologies and products with multiple patents (such as genetically modified (GM) plants) than for products that are derived from traditional biotechnologies, such as micropropagation or tissue culture.

In Section 1 of this document, the main elements of the discussions are summarised under a number of main themes. Specific references to messages posted, giving the participant's surname and the date posted (day/month), are included. One participant, Glenn Ashton, posted two messages on a single day and they can be differentiated by the order in which they were posted (i.e. Ashton 12/4(1) indicates the first message he posted on 12 April). Section 2 provides some information about participation in the conference and Section 3 gives the name and country of the people that sent referenced messages. Section 4 provides an explanation of abbreviations used.

1.1 Background information on IPRs and patents

A few participants gave some background information on IPRs and patents that reinforced or supplemented information previously provided in the Background Document to the conference.

Roger (9/5) emphasised that IPRs are, firstly, scientific disclosures that can contribute to human knowledge. As Lettington (20/3) said, they "are a limited monopoly granted by individual states as a privilege in return for making an invention, or some other useful information, public. The policy reasoning is that, even though society as a whole loses a little through the monopoly, it gains more from the information". Roger (9/5) also reminded participants that IPRs have a temporal and geographical limit and that perpetual and world-wide patents, trademarks or plant breeders' rights do not exist. He also noted that a patent was not an authorisation for commercialisation, although Steane (11/5) pointed out that the aim with many biotechnology patents was often not commercialisation but to stop others using the technology. Saunders (10/4), on the same subject, wrote that ownership of a patent in a particular country is "a negative right. It permits the owner to exclude others from practising the invention. A patent does not act to permit the patent owner to do anything".

Saunders (10/4) also gave good insights into some of the commercial considerations behind patenting, including:
a) There are two reasons why someone would apply for a patent in a developing country:

i) to make a profit - which requires two elements seldom present together in developing countries, i.e. a good market for the invention and the means (financial resources and a functional legal system) to enforce the patent
ii) to prevent the developing country making infringing products (only the largest international corporations would patent for this reason)

b) Making a profit from a patent requires the applicant having funds to

i) obtain or license the patent
ii) enforce it

c) Licensing of patents is less attractive in developing countries as the market may be small and patent enforcement may be expensive, slow or uncertain.

1.2 Companies from developed countries patenting genetic material from developing countries

One of the most controversial impacts or consequences of the current IPRs system, which was also raised in Conference 1 of the Forum, is that "there are many instances where genetic resources from developing countries were granted patents in developed countries, often without the knowledge and consent of the owners of such resources in developing countries" (Srinivasan, 22/3). The term "biopiracy" is often used to describe this phenomenon. The frustration and anger the issue raises come from the perceived appropriation (or "sack" as Ferry (23/3) called it) of the resources in developing countries by parties in developed countries; the apparent lack of adequate mechanisms to prevent it happening (Vasquez, 3/5) and the failure to both acknowledge the contribution that farmers in developing countries have made to the resources and to share the benefits with them.

Ageeb (21/3) provided some examples where biotechnology companies had reputedly patented genetic material of commercial value in developing countries and made use of existing indigenous knowledge of native peoples in these countries. One particular case discussed in some detail (e.g. Srinivasan, 26/3) was that of United States patent 6,040,503 awarded in March 2000 for beans that expand (pop) upon heating, involving crosses of Nuna beans, from the Andean region of South America, with the common bean (the patent can be seen on the web by searching on the patent number at http://164.195.100.11/netahtml/srchnum.htm ). Srinivasan (22/3) expressed reservations about the patent and argued that stricter rules on awarding IPRs should be devised. He reported a range of concerns, including the use of genetic material (from a public gene bank) freely provided by Andean farming communities for conservation purposes and the fact that the indigenous people had prior knowledge of the popping characteristics of the Nuna bean (Srinivasan, 22/3 and 26/3). Lin (23/3) argued instead that the variety was novel and the patent was defensible. He emphasised that the patent claims did not directly concern the Nuna bean but only the results of crossing them with the common bean, producing a novel variety adapted to the more temperate climate in the United States.

Gallego-Beltran (30/4) claimed that biotechnology companies used universities as a "middleman" to gain easier access to valuable biological material. He argued that some research collaborations between institutions in developed and developing countries resulted in researchers "sometimes voluntarily sometimes not, acting just as sample collectors and couriers from the south to the north" and that the "capturing" of the biological material was often one of the main motives for the collaboration. Although from Latin America, a couple of participants in Africa (Olutogun, 4/5; Wingfield, 4/5) identified with these experiences and argued that they also reflected events on their continent. Ndegwa (2/5) emphasised that the situation described by Gallego-Beltran (30/4) occurred frequently in developing countries and was getting worse over time.

Both Ndegwa (2/5) and Ageeb (21/3) emphasised the need for action by developing countries, as "countries of the biologically-rich regions should protect their natural genetic resources and the indigenous knowledge of their native peoples" (Ageeb, 21/3). Ndegwa (2/5) argued that the starting point should be investments by governments and institutions in building the necessary intellectual property and legal capacity, to "ensure that they are not ignorantly short-changed by developed countries or institutions. It is futile to fight a system that one does not understand". She noted that, in the current situation, most universities in developing countries will sign a collaborative research agreement without understanding the IPRs provisions it contains, whereas those in developed countries will have a legal/IPRs unit to look at any agreements before they sign.

Participants seemed to agree that, until now, there had been little or no sharing of the economic benefits from biotechnology developments derived from genetic resources of developing countries (Ageeb, 21/3; Ferry, 23/3; Srinivasan, 27/3; Vasquez, 3/5). Ferry (23/3) argued that big companies had earned a lot of money from these genetic resources and that they should return part of it to the poor farmers in these countries. Ageeb (23/3) pointed out that in the current biotechnology era, the working unit is the gene rather than the organism and that if rare, valuable genes (which he termed "green gold") from developing countries were used then the countries should ask for compensation. Srinivasan (27/3) proposed that, to secure some of the benefits, an assessment be carried out of the value of genetic resources from different countries so that, based on factors such as the amount of germplasm contributed by developing countries, a percentage of the value of a crop in a developed country could be shared with, and used to establish strong IPRs systems in, developing countries.

Srinivasan (7/5) pointed out the economic damage this issue may cause since "if patents are given in developed countries to products from certain regions in developing countries, those regions could experience substantial negative impacts in terms of reduced exports". To illustrate the point, he raised the specific case of United States patent 5,663,484 granted in 1997 on Basmati rice lines and grains to a company based in Texas. Since the owner of the patent could call the rice "Basmati", both within the United States and when exporting, he argued that this could damage the traditional and economically important export of Basmati rice from India and Pakistan throughout the world (including to the United States).

It might be expected that the Convention on Biological Diversity (CBD) could contribute to solving problems regarding the protection and use of biodiversity (Vasquez, 3/5), as it provides "a legally binding framework for conservation, and sustainable use of biodiversity while seeking to establish benefit sharing mechanisms" (Ndegwa, 2/5). In addition, Article 16 (5) of the Convention states that parties to the CBD shall co-operate to ensure that patents and other IPRs "are supportive of and do not run counter to its [CBD] objectives" (Van Overwalle, 4/5). However, Wollny (21/3) argued that, with respect to their plant genetic resources, the CBD had failed to ensure that local and indigenous communities had been protected and provided with benefits. Participants also argued that it favoured developed rather than developing countries (Lettington, 20/3; Ndegwa, 2/5). Steane (11/5) also pointed out that one of the major biotechnology patenting countries (the United States) had not yet ratified the CBD and so was not bound by it. The potential contribution of another international agreement, the International Undertaking on Plant Genetic Resources for Food and Agriculture, to this question was also mentioned (Lettington, 20/3; Wendt, 11/4)

Central to this whole issue is the question of what can be patented and the problem of distinguishing between discovery and invention. As Lettington (20/3) pointed out, this is a huge problem, particularly in developed countries and, in relation to biological material, clarification is needed about to what extent something that previously existed can be "invented". In this context, some participants found it hard to accept that genetic resources of developing countries could be treated as inventions rather than discoveries (Ageeb, 21/3; Fakir, 21/3; Srinivasan, 22/3). Graff (12/4) argued that one of the failures of IPRs systems was, indeed, to define what is patentable, i.e. "to clearly demarcate between what should be placed in the country's public pool of human knowledge (or genetic resources) and what can be rightfully defended within the borders of the country as a private piece of knowledge or technology (or genetic resource)". He pointed out that policies on the definition of what is patentable in the field of agricultural biotechnology differ from country to country and, within each country, they vary over time. He suggested, using the United States as an example, that it might be difficult to make specific changes to the definition of what is patentable.

1.3 Impact on agricultural research

This issue was raised frequently throughout the conference. Participants suggested that IPRs had influenced the quality of agricultural research carried out, as well as the nature of research collaborations between public and private institutions, between developing and developed countries and even between private companies.

a) Quality of research

Most comments on this subject argued that IPRs slowed down research collaborations and the flow of knowledge between interested research parties and that they therefore had a negative impact on the quality of research carried out. Wollny (21/3) reported that restrictive national policies on international research and exchange of animal genetic resources, introduced because of IPRs issues, had in some cases prevented genuine research being carried out. Glover (28/3) referred to a paper by Professor Barton published in Science (2000, volume 287, pages 1933-1934) which argued that one of the three problems caused by applying current United States patent law was "the tendency for patents to complicate and deter useful and desirable follow-on research, which can occur when patents are granted on 'broadly useful information and technology' or 'fundamental research processes' ".

Fakir (29/3) agreed with the arguments in an article in Science (1998, volume 280, pages 698-701) that, unlike the "tragedy of the commons" (where having too many owners can result in overuse of a resource), the complex proliferation of patents in research was leading to the "anticommons", where many owners have the right to exclude others and the resource then becomes underused i.e. that research and innovation are stifled rather than stimulated by the multitude of patent holders. This point was supported by comments of Lin (27/3), who noted that patenting hindered the flow of knowledge and genetic material in private industry, often leading to biotechnology companies abandoning promising lines of agricultural research as they lacked sufficient "freedom to operate" because of patents held by a competitor. Ndegwa (2/5) and Tripathi (2/5) also concluded that IPRs did not encourage innovation.

Roger (9/5), however, argued that "a patent provides transparent information about scientific knowledge and by limiting patentability I fear that transparency will be lost". De Lange (11/5) disputed this, suggesting that "scientists working on something that may be patentable, will share less knowledge with colleagues in order to prevent someone else stealing the idea and patenting it". Roberts (14/5) disagreed with De Lange's proposition, arguing that many scientists work in the private sector and once a patent application is filed or published, companies will allow research results to be published whereas, in the absence of patenting, they would be more cautious and try to keep everything secret.

b) Private-public sector research collaborations

Roberts (14/5) pointed out that money for public research is scarce whereas research in the private sector is increasingly important and that IPRs are an important incentive for private sector research. However, the effect of IPRs on crop improvement is to restrict the flow of both knowledge and improved germplasm between the private and public sectors, which is a particular disadvantage for poor farmers who previously benefited from this flow in the "green revolution" (Glover, 26/3). Apart from the desire to cut public expenditure (Cummings, 9/4), public-private partnerships are therefore often encouraged in order to tap, for the benefit of public goods research, "the knowledge and technologies developed in the private sector" and that this was the trend with international agricultural research centres (Immonen, 2/5). She, however, expressed concerns about such partnerships, as the collaboration agreements may require confidentiality and may restrict sharing of ideas with the greater research community - something which might ultimately damage the public sector research effort (Immonen, 2/5). Ferry (11/4) urged that public laboratories, working on questions of interest to developing countries, should negotiate contracts with the private sector that fit with their public obligations or else they should refuse them. Immonen (2/5), in a similar vein, argued that where they had bargaining power, public organisations should avoid exclusive collaboration agreements with the private sector and retain their rights to information sharing.

c) Developed-developing country research collaborations

Participants also discussed the impact of IPRs on the nature of research collaborations between developed and developing countries. Lettington (20/3) argued that patenting in the agricultural sector broke the traditional access and benefit sharing (ABS) system previously implicit in agricultural research (i.e. that developing countries provide free access to their genetic resources and receive the benefits of the research in developed countries for free) and replaced it with an asymmetrical system where access to genetic resources was still free but the benefits of research were not, i.e. "all A and no BS". He noted that the CBD, which recognises the sovereign rights of states over their natural resources, was a reaction to this situation since parties should now also pay for access to genetic resources.

Gallego-Beltran (30/4) expressed concerns about some unbalanced developed-developing country research collaborations which result in developed countries gaining access to valuable genetic resources in developing countries but where the main, if not all, research activities are carried out in developed countries, so the scientific return for developing countries is minimal. Ndegwa (2/5) emphasised that because of IPRs and the increasingly dominant role of the private sector, free exchange of information was becoming a thing of the past and that the universities in developing countries (unlike their counterparts in developed countries) had not yet adapted to the new reality. She summarised the current situation as follows, "you have the private sector who look at scientific information in terms of dollar value, the northern universities who are maximizing the moment by tending towards the 'private' in IPRs dealing....and the southern universities who are doing (or willing to do) science in the philosophy-of-science way but who are resource poor".

1.4 Whether IPRs favour the interests of developed countries and the biotechnology industry over those of developing countries

Some participants argued that the very nature of the current IPRs system discriminated against developing countries because it unfairly places a greater value on biotechnology outputs, generally produced in developed countries, than on genetic resources (often used to create the biotechnology products) and contributions from communities, usually in developing countries (Lettington, 20/3; Srinivasan, 22/3 and 27/3; Granda, 28/3; Ferry, 10/4; Vasquez, 3/5).

Some participants went further and argued that IPRs were really used by developed countries to dominate and to continue their exploitation of developing countries (Ashton, 12/4(2), Olutogun, 4/5). For example, Ashton (12/4(1)) suggested that the playing field was strongly biased in favour of developed countries and that IPRs were merely instruments of economic policies that "entrenched colonialism in a more modern economic idiom". Others emphasised the specific role that multi-national corporations (MNCs) from developed countries played, arguing that they used IPRs to entrench corporate power and to create market monopolies (Lettington, 20/3; Ageeb, 21/3; Fakir, 21/3). Lettington (20/3) suggested that, in addition to IPRs, they also used other mechanisms, such as legal contracts with farmers, for the same purposes, or genetic use restriction technologies "that essentially constitute a regulatory system that bypasses IPRs and government authority".

To illustrate the enormous gap between developed and developing countries regarding IPRs, as well as the concentration of power among a handful of biotechnology companies, Granda (28/3) referred to statistics from the 1999 UNDP Human Development Report which showed that developed countries hold 97% of all patents worldwide; that over 80% of patents granted in developing countries are owned by residents in the developed world and that the top 5 biotechnology companies control over 95% of gene transfer patents. Given that the vast majority of patents granted in developing countries are owned by parties in developed countries, some participants argued that the main aim of the pressure exerted on developing countries to harmonise or introduce national IPRs legislation, as well as to build up their capacity in this area, was to ensure that MNCs and developed countries would be able to enforce their patents granted in developing countries (Ndegwa, 2/5; Vasquez, 4/5).

Roger (9/5) emphasised however that, for economic reasons, only a minority of biotechnology patents were granted in developing countries compared to the developed world. As Saunders (10/4) pointed out, when a company considers where to apply for a patent it will first assess the markets for the invention, weighing up the costs against the prospective return and the likelihood and timing of the return. He suggested, as an example, that for an invention related to forestry/paper, a company might therefore only apply in "Canada, Scandinavia, Japan, United States, Brazil and perhaps Myanmar and Thailand" or, depending on the financial resources available, in a subset of these countries. Roger (9/5) underlined that the scientific content of a patent is nevertheless available worldwide and it can be used freely in all countries where the patent has not been granted. As Ndegwa (3/5) explained, "a patent owner can ONLY enforce his rights in countries where that protection has been sought and granted. This means that if a USA inventor seeks and obtains a patent in USA, but fails to do so in Venezuela, he cannot enforce his rights in Venezuela, even though the latter is a member of the WTO as the USA is. In fact, anyone can exploit the invention in Venezuela without infringing on the rights of the patent holder".

1.5 Avoiding or alleviating the negative impacts of the current IPRs system

From the preceding part of the document (Sections 1.2-1.4), it is clear that most comments in the conference highlighted the negative impacts of the current IPRs system on developing countries, on issues such as agricultural research or ownership of genetic resources and knowledge. In Section 3 of the Background Document, it was suggested that participants should discuss how the negative impacts or consequences of IPRs for food and agriculture in developing countries could be avoided or alleviated. Participants seemed to have two different approaches to this question. The first was to call for a reassessment of the current IPRs system and to propose a better one. The second approach was to accept the current system and, instead, to seek strategies to minimise its negative impacts.

a) Reconsider the current IPRs system and propose a better one

Lettington (20/3) probably provided a good summary of this reasoning, i.e. "there must be a serious reassessment of the IPRs system as applied to agricultural sector - it is not meant to be applied to this and it is creating asymmetries that impact negatively on the most vulnerable". Participants proposed different kinds of "reassessments" of the system. Ferry (23/3) emphasised the ethical dimension to the question and argued that the system should be changed so that, instead of giving similar rights to the North and South, it should give more to the South, to compensate them for previous wrongs regarding genetic resources and because of their poverty. Srinivasan (22/3) highlighted the need for the system to address the incompatibility between IPRs and farmers' rights (i.e. rights arising from the past, present and future contribution of farmers in conserving, improving and making available the agricultural genetic resources). He proposed that, as a pre-requisite, the concept of ownership of genetic resources should be eliminated. He also called for "flexible IPRs", which would guarantee the right of farmers in developing countries to continue with traditional practices such as on-farm seed saving or swapping grain for seed.

Ashton (12/4 (1 and 2)), supported by Gallego-Beltran (30/4), argued that claims to legal ownership over life forms were inherently flawed. He therefore proposed that "the entire intellectual property regime needs to be rethought and renegotiated" and that a range of possible alternatives existed (Ashton, 12/4(2)). Currently, as explained in the Background Document, patents on specific genes usually extend to the plant into which the genes are inserted. He described one alternative, based on the "principle of proportional ownership", where the value of any added genetic component would only be a proportion of the whole and where a significant proportion of ownership would remain with the traditional seed holders and developers. The concept was supported by Steane (11/5) who, however, warned that many developed countries would not welcome a re-evaluation of the current IPRs system.

b) Accept the current IPRs system and pursue strategies to minimise its negative impacts

Even though they might consider the current system to be unjust, some people felt that the best approach was to accept it, while looking for ways to alleviate its negative impacts. The dilemma can be reflected in the words of Ndegwa (2/5): "the stage has been set; the possessive adjective 'my' is replacing 'our' day by day. Even if a reverse of the current state was thinkable, we cannot stand by and wait for an IPRs-free world. We have to make the best out of the current situation. Governments and institutions in developing countries have to invest in building the necessary IPRs and legal capacity".

Patenting of the developing world's indigenous knowledge and resources by companies in the developed world was one of the negative impacts commonly raised in the conference (see Section 1.2). Documentation of the indigenous resources to protect them was one concrete defence action proposed by participants. Srinivasan (22/3) suggested that international organisations should help people in developing countries to patent indigenous technologies in developing countries. Wendt (11/4) also maintained that official registration of already existing (traditional) resources was one of the main features behind the creation and implementation of efficient and just IPRs systems.

Another strategy proposed to reduce the negative impacts was to fine tune the way current patent legislation is applied. Glover (28/3) described three modifications proposed by Professor Barton in an article in Science (2000) for the United States patent system, i.e. to raise the standards of patentability of an invention; to ensure that patents do not restrict useful follow-on research and, finally, to make it easier to legally challenge invalid patents. Glover (28/3) suggested that if such reforms were applied internationally they might help to improve the patent system by providing a better balance between private and public interests and by addressing some of the concerns raised in the Background Document and throughout the conference. Srinivasan (2/4) proposed that the adverse effects of IPRs on innovation could be reduced by "establishing smooth, easy, and less expensive means for licensing", a point also made at a workshop held recently in this area (Lin, 9/4).

Roger (9/5) also provided a reminder that countries had a choice of protection mechanisms available and that some were stricter than others. He emphasised for example, that the breeders' exemption clause in the PVP system based on the UPOV Convention ensures that protected varieties remain freely available for further breeding, whereas with other systems this might not be the case.

In the conference, participants also argued that IPRs favour the interests of developed countries and a handful of biotechnology MNCs over those of developing countries (see Section 1.4). One of the reasons for the extensive merging of biotechnology companies has been their need to accumulate IPRs portfolios large enough to allow them to produce crop varieties that can be commercialised. At a meeting in February 2001, Dr Toenniessen of the Rockefeller Foundation pointed out that the international agricultural research system has no such IPRs portfolio, so the traditional flow of improved plant materials through the system is breaking down (Glover, 26/3). He therefore proposed that, to rectify this, the agricultural research institutions in the public sector should begin to pool their IPRs into a professionally managed IPRs portfolio designated to serve poor farmers. Graff (12/4) reported that, similarly, one of the recommendations of a recent workshop was that agricultural research and development for developing countries needs a "multilateral office of technology transfer" to gain and manage access to IPRs as well as to manage the internal exchange and pooling of their own IPRs. Lin (27/3) felt that private industry might also support the suggestion of a "clearing house for essential technologies", to enable a freer flow of knowledge and materials.

Van Overwalle (4/5) emphasised the important role that governments in developed countries could play in redressing some negative impacts of the dominating IPRs position of developed countries. He argued that governments should stimulate their universities, research institutes and private companies to provide access to, and transfer of, genetic technology and transgenic seeds subject to patents, to developing countries free of charge if the technology or seeds are only going to be used for local, small scale commercialisation and marketing. Similarly, Granda (7/5) argued that GM technology should be made available to the public domain for crops that do not generate an economic return.

If private industry developed biotechnology products that were both important for hunger in developing countries and protected by IPRs, Ferry (11/4) argued that a media campaign could lead to the companies providing the products at a reasonable price, as had been done in South Africa for medicines to fight AIDS. He argued that the campaign could be justified on the basis that world hunger and food security are a question of life and death. On the same subject, Srinivasan (22/3) suggested that deals between private companies and international organisations to supply the products at a reasonable price should be encouraged.

1.6 National IPRs legislation in developing countries

During the conference, participants raised some specific issues about IPRs legislation in developing countries i.e. the trend towards harmonisation of national IPRs legislation, as well as infringement and enforcement of IPRs legislation.

a) Harmonisation of national IPRs legislation

IPRs regimes in developing countries have tended to be weaker than in developed countries. In recent years, however, steps have been made towards increased harmonisation of national IPRs legislation. In this context, a key element is the World Trade Organization (WTO) agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) (Ndegwa, 2/5 and 3/5). This international agreement is binding on all WTO members and sets certain minimum standards for the implementation of IPRs at the national level, and in this way promotes harmonisation of national IPRs regimes (Ndegwa, 3/5;Vasquez, 4/5).

As the agreement has many important implications for developing countries and has been the source of much controversy, it was not surprising that there were some specific comments about it. Some participants suggested that the TRIPS Agreement was promoted by the United States in order to globalise patent laws (Glover, 28/3; Vasquez, 3/5 and 4/5). Ndegwa (2/5) argued that agreements such as TRIPS favoured developed rather than developing countries and the private rather than the public sector. Vasquez (3/5) maintained that it would exacerbate inequities in the world and that it should be reviewed or dropped. Lin (3/5), however, highlighted that national governments had some flexibility when applying provisions of the TRIPS Agreement, i.e. that
i) plants and animals and biological processes for the production of plants and animals could be excluded for patentability
ii) inventions which threaten public order or morality could be excluded for patentability (although Roger (9/5) thought it would be difficult to determine which patents these might be)
iii) although plant varieties have to be protected, this may be done by patents and/or effective sui generis systems (such as PVP).

Tripathi (14/5) felt that the introduction of IPRs systems (such as PVP) for plant varieties, due to the TRIPS Agreement, would harm farmers in developing countries because of the associated financial costs and the potential risk of reducing plant diversity. She also suggested, based on studies in countries such as United Kingdom and Brazil, that the introduction of PVP would lead to consolidation of the seed industry (Tripathi, 2/5).

b) Infringement and enforcement of IPRs legislation in developing countries

Saunders (10/4) provided some economic insights into this topic, explaining that "a patent holder demanding "too high" a price creates a market for infringers. An infringer succeeding too well at infringement invites the patent holder to enforce. However, infringement is favored in a developing country by the increased cost of enforcement by a distant patent holder seeking to limit price erosion in a small market".

The recent much-publicised case in Canada where Monsanto successfully sued a farmer Percy Schmeiser for illegally planting the company's patented GM canola seeds, despite the farmer's insistence that the seeds ended up on his farm by accident (e.g. Srinivasan, 2/4; Cummings, 9/4), led to some comments about enforcement of IPRs legislation in developing countries. Hollis (9/4) suggested that, if it had sufficient political and economic weight, a seed company pursuing a similar strategy in a developing country could increase its monopoly on the market and that the dependency created could put farmers at a disadvantage. Srinivasan (2/4) argued that a similar judgement involving farmers in developing countries could lead to a backlash against biotechnology and could "have a dampening effect on the development of indigenous biotechnologies appropriate to a particular crop/region/country". He suggested therefore that there was a need for differential standards of IPRs enforcement and protection in various countries, especially in the food and agricultural sector, which was shown by findings that patents in developing countries (India) have a much lower value than in developed countries and that the value of patents in agriculture was lower than in various other industries.

Wendt (5/4), however, highlighted the problems that seeds companies face in Latin America, suggesting that a lot of farmers exploit exemptions in the PVP laws to cultivate and commercialise protected varieties. He therefore argued that if the companies "don't pursue violations of their IPRs they are soon going to lose control of what is happening with their new varieties and won't be able to sell them".

Wendt (11/4) also noted that, in their national legislation, several Latin American countries explicitly addressed topics such as farmers' rights and access to and sharing benefits from genetic resources and traditional knowledge. He suggested, however, that there were still difficulties in implementing them and that international organisations, such as WIPO or FAO, could help by creating broader awareness about the importance and problems of protecting IPRs and traditional resources.

1.7 Multiplicity of patents

As pointed out in the Background Document, there are some special concerns about the consequences of the current situation where many steps of patented technologies may be required for the development of a biotechnology product. For example, development of a GM insect-resistant crop may involve using a protected plant variety as well as patents related to the selected marker gene and the insecticidal gene, the transformation technology, the promoter and other regulatory elements needed for adequate gene expression in the plant cells (Srinivasan, 7/5). The multiplicity of patents embedded in a biotechnology product can make the product expensive (Srinivasan, 22/3) and means that even a single IPRs holder can block commercialisation of a product (Srinivasan, 7/5). In addition, it may give private companies considerable power because of the strategy of building up "defensive patent portfolios", often involving trivial "inventions" (Glover, 28/3). The costs associated with transacting IPRs can be quite substantial "as a result of broadly or poorly defined property rights in individual patents and single products involving technologies claimed by multiple IPRs holders" (Lin, 9/4), and can be a major constraint to innovation (Fakir, 29/3).

1.8 Plant variety protection

When considering particular IPRs, most discussion in the conference focused on patents. However, some specific points were also made about PVP (also known as plant breeders' rights). PVP laws are generally based on the UPOV Convention, signed in 1961 and revised in 1972, 1978 and 1991 (Roger, 9/5). To be granted protection, a variety must fulfil criteria governing novelty, distinctiveness, uniformity and stability (Archak, 7/5; Roger, 9/5), although Archak (7/5) pointed out that it was not easy to define distinctiveness.

Wendt (11/4) noted that, in Latin America, PVP was more important than patents. He pointed out that "there are two very important points in which PVP differs from patents: first, the "farmers' privilege", which allows farmers to save seeds for their own use and, second, the "breeders' exemption" which allows any plant breeder to use the protected variety as a basis to develop a new one without previous consent of the owner of the original protected variety". He concluded therefore that PVP provided greater access to genetic material, a point supported by Roger (9/5) and Steane (11/5).

1.9 Livestock sector

As pointed out by Steane (11/5), the majority of messages in the conference dealt with plants, where there is already considerable experience of IPRs. He noted that the role of IPRs for animals is currently limited but the implications are dramatic. Ageeb (23/3) argued that biotechnology advancements were slower in livestock research than in crops or medicine, but predicted that, "in the near future, the genetic materials of tropical livestock will effectively contribute to the biotechnology revolution". Wollny (21/3) questioned whether a policy claiming IPRs to protect animal genetic resources would have any practical benefits now for farmers in developing countries as most of the genetic material is "of no known use or function and has no present market value". He suggested therefore that standards for maintaining the resources should be applied and, in the future, when biotechnology discoveries are made, that policy makers could develop adequate access and genetic material transfer agreements. Finally, Steane (11/5) pointed out that whereas plant sector policy makers have patent or PVP options available, there is currently no equivalent of PVP for livestock so the problems associated with the definition of what is patentable may have even greater importance for the livestock sector.

3. Participation in the conference

The conference ran from 20 March to 14 May 2001. A total of 265 people registered and 30 of them (11%) submitted at least one of the 50 messages posted. The greatest proportion (36%) of messages were from Europe, with 20% each from Africa and North America, and 18 and 6% from Asia and Latin America and the Caribbean respectively. Roughly two thirds were from participants in developed countries and one third from the developing world. Messages were posted from 18 different countries. Countries with the greatest number of messages posted were the United States (8 messages), United Kingdom (6) and France, Japan and South Africa (all with 5 each).

Of the 30 people that submitted messages, eight worked at universities and five in research centres or institutes. Four each were independent consultants and from NGOs, three from international agricultural research centres, two were patent lawyers, one was a reporter and there was also one each from FAO, private industry and a government ministry.

3. Name and country of participants with referenced messages

    Ageeb, Abdelgadir. Canada
    Archak, Sunil. India
    Ashton, Glenn. South Africa
    Cummings, Claire. United States
    De Lange, Wytze. Netherlands
    Fakir, Saliem. South Africa
    Ferry, Michel. Spain
    Gallego-Beltran, Juan. Colombia
    Glover, Dominic. United Kingdom
    Graff, Gregory. United States
    Granda, Willy Valdivia. United States
    Hollis, Kevin. United States
    Immonen, Sirkka. Italy
    Lettington, Robert. Kenya
    Lin, Edo. France
    Ndegwa, Rose. Kenya
    Olutogun, Olusanya. Nigeria
    Roberts, Tim. United Kingdom
    Roger, Pierre. France
    Saunders, Thomas. United States
    Srinivasan, Ancha. Japan
    Steane, David. Thailand
    Tripathi, Ruchi. United Kingdom
    Van Overwalle, Geertrui. Belgium
    Vasquez, Chela. United States
    Wendt, Jan. Chile
    Wingfield, Brenda. South Africa
    Wollny, Clemens. Botswana

4. Abbreviations

CBD = Convention on Biological Diversity; FAO = Food and Agriculture Organization of the United Nations; GM = Genetically modified; IPRs = Intellectual property rights; MNCs = Multi-national corporations; PVP = Plant variety protection; The TRIPS Agreement = WTO's agreement on Trade-Related Aspects of Intellectual Property Rights; UNDP = United Nations Development Programme; UPOV = International Union for the Protection of New Varieties of Plants; WIPO = World Intellectual Property Organization; WTO = World Trade Organization

Archives

The impact of intellectual property rights (IPRs) on food and agriculture in developing countries

Moderated log files from the email discussions are available here, by subject or by date. They can also be retrieved by email and as monthly archives: March, April, May.

Posted messages by subject :

1.General comments on the Background Document
2.IPRs // local knowledge // MNCs
3.Re: General comments on the Background Document
4.Animal genetic resources // Africa
5.Re: General comments on the Background Document
6.Prerequisites for acceptance of IPRs in developing countries
7.Nuna bean
8.Re: Animal genetic resources // Africa
9.Re: Nuna bean
10.Re: Nuna bean
11.IPRs and public international agricultural research
12.Re: IPRs and public international agricultural research
13.Re: IPRs and public international agricultural research
14.Reforming patent law
15.How practical are IPRs in Least Developing Countries (LDCs)
16.Re: How practical are IPRs in Least Developing Countries (LDCs)
17.Liability for biotech products in developing countries
18.Re: Liability for biotech products in developing countries
19.Re: Liability for biotech products in developing countries
20.Re: Liability for biotech products in developing countries
21.Relevant information
22.Re: Liability for biotech products in developing countries
23.Patenting and relevant business decision factors
24.National-international legislation // PVP
25.Re: Relevant information
26.An impasse of ownership
27.Rethinking the IP regime
28.Re: Relevant information
29.Universities and IPRs
30.Re: Universities and IPRs
31.Plant breeders rights and their impact for developing countries
32.Private-public partnerships
33.Should developing countries comply with IPR regulations?
34.Re: Should developing countries comply with IPR regulations?
35.TRIPS
36.Re: Universities and IPR
37.Re: Universities and IPR
38.Re: TRIPS
39.Defining a role for developed countries
40.Impacts - Regions and technologies
41.Transgenic crops
42.Plant variety protection
43.Re: Impacts - Regions and technologies
44.Re: Plant variety protection
45.PBR's negative impact??
46.Animals and IPRs
47.Re: Plant variety protection
48.Re: Plant variety protection
49.Food security and TRIPS
50.Re: Animals and IPRs

Archives March 2001

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Archives April 2001

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See Update from The Forum Administrator, March 30.
This conference ran until 13 May, 2001.


Email Archives:

All messages posted during the two month-long conference will be stored and can be retrieved. The messages are stored in monthly files. To retrieve them, follow instructions below. The log files will be sent to you in return as a single e-mail message. Note: you must have joined the Forum and subscribed to Conference 6 to access the e-mail archives.

To get all messages posted in the conference during March 2001, send an e-mail message to mailserv@mailserv.fao.org leaving the subject blank and entering the one-line text message as follows:

send listlog/biotech-room2.mar2001

Note: lower case letters as shown here, and not upper case letters, must be used. No other text should be added to the message (e.g., mail signature).

To get the messages posted in the conference during April 2001, do the same except writing
send listlog/biotech-room2.apr2001

Conferences

Agricultural Biotechnologies in Developing Countries (ABDC-10) Conference