INTELLECTUAL PROPERTY AND ENVIRONMENT: THE RELATIONSHIP BETWEEN THE CONVENTION ON BIOLOGICAL DIVERSITY AND THE TRIPS AGREEMENT DRAFT WORKING PAPER

Transcription

1 INTELLECTUAL PROPERTY AND ENVIRONMENT: THE RELATIONSHIP BETWEEN THE CONVENTION ON BIOLOGICAL DIVERSITY AND THE TRIPS AGREEMENT DRAFT WORKING PAPER Capacity Building Meeting on Environment, Trade and Sustainable Developme nt for the Latin American and Caribbean Region, Mexico City, MEXICO, 27 th -28 th March

2 INTELLECTUAL PROPERTY AND ENVIRONMENT: THE RELATIONSHIP BETWEEN THE CONVENTION ON BIOLOGICAL DIVERSITY AND THE TRIPS AGREEMENT 1 1. Introduction This paper identifies a selection of key issues arising from the relationship between intellectual property and the environment, and between two of the principal international agreements governing these respective areas the WTO Agreement on Trade Related Aspects of Intellectual Property (TRIPS Agreement) and Convention on Biological Diversity (CBD). The importance of these relationships has been emphasized at recent international meetings, including the WTO Doha Ministerial Meeting and the World Summit on Sustainable Development (WSSD). The Doha Ministerial Declaration called for the TRIPS Council to examine, inter alia, the relationship between the TRIPS Agreement and the Convention on Biological Diversity, the protection of traditional knowledge and folklore (paragraph 19). The WSSD, similarly, called for action at all levels to promote discussions with regard to the relationships between the Convention and agreements related to international trade and intellectual property rights, as outlined in the Doha Ministeria l Declaration (paragraph 42(r)). The importance of these relationships particularly for developing countries rich in biological resources is matched by their complexity; underpinning the need for effective capacity building to help understand the linkages and build mutually supportive trade and environmental policies. To help policy-makers and other stakeholders identify capacity building needs and priorities, this paper provides an overview of a selected set of key issues at the interface of intellectual property and the environment, with a focus on the nexus between the TRIPS Agreement and the CBD. The discussion in this paper is preliminary. By its very nature, the paper can neither identify all issues arising in this field, nor can it comprehensively address all of the issues it does cover. Rather, it is designed to provide a brief roadmap to support discussions by national policymakers, and to raise some questions regarding capacity building needs. This paper has five parts. Following this introduction, Section 2 provides a brief overview of the CBD and the TRIPS Agreement, and of recent developments at the Doha Ministerial and the WSSD relevant. Section 3 identifies some key issues for sustainable development including those arising from intellectual property and conservation and sustainable use of genetic resources, protection of traditional knowledge, agricultural biodiversity, transfer of technology, and development. Section 4 briefly identifies the benefits of strengthening coherence between the many institutions working in this field, and the need for additional capacity to allow developing countries participate meaningfully within and across these various fora. The paper concludes in Section 5, and includes some questions on capacity building in Annex Background on the relationship between the CBD and the TRIPS Agreement The CBD is among the principal international agreements for the conservation of biological diversity, and has three main objectives: the conservation of bio diversity; the sustainable use of its components; and sharing the benefits arising from the commercial and other utilization of genetic resources in a fair and equitable way. Its provisions cover a wide range of topics relevant 1 This working paper was prepared by Matthew Stilwell for the March 2003 UNEP Capacity Building Meeting on Environment, Trade and Sustainable Development for the Latin American and Caribbean Region. This paper draws significantly on materials prepared by UNEP, the CBD Secretariat and the WTO. The views expressed, however, are those of the author. 2

3 to biodiversity conservatio n including, access to genetic resources and prior informed consent, benefit sharing arrangements, traditional knowledge, and transfer of technology, as well as a number of provisions relating to intellectual property. The TRIPS Agreement provides minimum standards concerning the availability, scope, use and enforcement of intellectual property rights, including patents and sui generis systems for plant variety protection. A number of its provisions including those relating to patents and sui generis systems for plant variety protection have implications for biodiversity conservation. In particular, certain exceptions (included in Article 27.3(b)) require the granting of patents or plant variety protection over certain biological resources. Currently these provisions are under review, as is the implementation of the Agreement itself (under Article 71.1). Clarifying the relationship between these two agreements both in legal and/or practical terms has been the subject of much discussion, and has been emphasized at the recent World Summit on Sustainable Development, the WTO and the CBD. At the WSSD, governments stated that biodiversity plays a critical role in overall sustainable development and poverty eradication, is essential to our planet, human well-being and to the livelihood and cultural integrity of people and called for action at all levels to: With a view to enhancing synergy and mutual supportiveness, taking into account the decisions under the relevant agreements, promote the discussions, without prejudging their outcome, with regard to the relationships between the Convention and agreements related to international trade and intellectual property rights, as outlined in the Doha Ministerial Declaration (paragraph 42(r)) At the Doha Ministerial Meeting, WTO Members instructed the TRIPS Council: in pursuing its work programme including under the review of Article 27.3(b), the review of the implementation of the TRIPS Agreement under Article 71.1 and the work foreseen pursuant to paragraph 12 of this Declaration, to examine, inter alia, the relationship between the TRIPS Agreement and the Convention on Biological Diversity, the protection of traditional knowledge and folklore, and other relevant new developments raised by Members pursuant to Article In undertaking this work, the TRIPS Council shall be guided by the objectives and principles set out in Articles 7 and 8 of the TRIPS Agreement and shall take fully into account the development dimension. (paragraph 19) As early as 1996, the CBD s Conference of Parties at its third meeting noted that: Further work is required to help develop a common appreciation of the relationship between intellectual property rights and the relevant provisions of the Agreement on Trade-Related Aspects of Intellectual Property Rights and the Convention on Biological Diversity, in particular on issues relating to technology transfer and conservation and sustainable use of biological diversity, and the fair and equitable sharing of benefits arising out of the use of genetic resources, including the protection of knowledge, innovations and practices of indigenous and local communities embodying traditional lifestyles relevant for the conservation and sustainable use of biological diversity (Decision III/17). Discussions of the relationship between the CBD and the TRIPS Agreement raise at least three categories of issues: practical, legal and policy, and organizational. 3

4 Practical issues relate to the effects of the two agreements on the actions of individua ls and groups in the real world, and the outcomes they produce. How, for example, will provisions in the CBD and TRIPS Agreement practically affect the transfer of technology required for the conservation and sustainable use of biological diversity? How do intellectual property rights affect access and benefit sharing arrangements for genetic resources and traditional knowledge? What effect can intellectual property rights have on traditional farming practices that relate to the conservation of biological diversity, such as the practice of saving and sharing seeds? Legal and policy issues. Relating to these practical issues are a range of legal and policy issues that also arise out of the relationship between the two agreements. Some governments have argued that there is a legal conflict between the two instruments the possibility of granting of the private rights pursuant to the TRIPS Agreement in one country, over products or processes based on genetic resources taken from another in the absence of prior informed consent, runs counter to the CBD s emphasis on sovereign rights over those natural resources. Other governments have responded that there is no such legal conflict, and that the two agreements are compatible and mutually supportive. Others still, state that while there may not strictly be a conflict in law between the two agreements, there may be significant practical challenges in ensuring mutually supportive implementation at the national level, which may require new approaches within or outside the context of those agreements, at the national or international level. Organizational issues. A third set of issues arise from the relationship between the CBD and the WTO as institutions; organizational issues, such as whether the CBD should be granted observer status in the TRIPS Council and the Committee on Trade and Environment, have also been raised. In addition to issues arising between the TRIPS Agreement and the CBD, policy-makers and other stakeholders may also wish to consider the relationship between these instruments and the instruments and processes in other international forums, such as the Food and Agriculture Organization s International Treaty on Plant Genetic Resources for Food and Agriculture, and the World Intellectual Property Organization s Intergovernmental Committee on Genetic Resources, Traditional Knowledge and Folklore, when seeking to identify approaches that promote sustainable development in an integrated manner. 3. Some key issues for sustainable development Ensuring a mutually supportive relationship between intellectual property rights and conservation of biological diversity, and between the CBD and the TRIPS Agreements, can make a major contribution to achieving sustainable development, and to realizing the goals set out by heads of state and governments at the recent World Summit on Sustainable Development. This section sets out a selection of these issues. Without attempting to be exhaustive, it addresses issues arising out of the linkages between intellectual property and genetic resources, traditional knowledge, agricultural biodiversity, and technology transfer, as well as the need to ensure such discussions of intellectual property adequately reflects the development dimension. A. Genetic resources The CBD and the TRIPS Agreement each touch on issues of genetic resources and intellectual property, giving rise to a set of practical and legal issues concerning their relationship in international law, and their implementation at the national level. 4

5 The CBD provides incentives to conserve biological diversity by encouraging its Parties to provide access to, and to equitably share the benefits arising from the utilization of, genetic resources. It includes as an objective the fair and equitable sharing of the benefits arising out of the utilization of genetic resources, including by appropriate access to genetic resources. It recognizes States sovereign rights over their own genetic resources (Preamble and Article 15(1)), and that the authority to determine access to genetic resources rests with the national governments and is subject to national legislation (Article 15(1)). It provides that access to genetic resources shall be provided on mutually agreed terms, and subject to prior informed consent of the Party providing those resources (Article 15(4) and (5)). It also envisages the use of legal measures that could conceivably include intellectual property rights (Article 15(7)), by calling on Parties to take legislative, administrative or policy measures to ensure the benefits arising from research, development and commercial use of genetic resources are shared in an equitable way with the provider of the genetic resources. 6 The TRIPS Agreement also covers issues relating to genetic resources. In some cases, inventions based on or utilizing genetic resources may be subject to intellectual property rights set out in the Agreement, including patents and plant variety protection. The Agreement provides that patents shall be available for any inventions, whether products or processes, in all fields of technology, provided that they are new, involve an inventive step and are capable of industrial application (Article 27.1). Exceptions to patentability included in Article 27.3(b) provide that WTO Members may exclude from patentability plants and animals other than micro-organisms, and essentially biological processes for the production of plants or animals other than non-biological and microbiological processes. But it also provides that Members shall provide for the protection of plant varieties either by patents or by an effective sui generis system or by any combination thereof. At the WTO, the review of Article 27.3(b) continues and provides one important focal point for discussions of biodiversity and intellectual property rights. The relationship of intellectual property rights and efforts to conserve and sustainably use genetic resources raises a number of issues. Issues of access and benefit sharing may arise when intellectual property rights are acquired in one country, over products or processes that are based on resources or knowledge that derives from another country, but without the prior informed consent of, or efforts to ensure that benefits flow to, the source country or community. Issues of an ethical nature have been raised by some countries over the patenting of life-forms. Concerns have also arisen about the patentability of biological resources in their natural state (i.e. relating to the distinction between inventions and discoveries in intellectual property law). Discussions such as these have arisen at the WTO and the CBD, and in some other international forums such as WIPO. At the WTO, some countries have noted that the TRIPS Agreement allows the granting of intellectual property rights regardless of whether genetic resources and related traditional knowledge have been gained with prior informed consent, with authorizations for their use, and with benefit sharing. 2 To address these concerns, they have suggested that the TRIPS Agreement should be amended to include a requirement to disclose the origin of genetic resources, and of any arrangements for access and benefit sharing. Other countries have argued that intellectual property rights do not facilitate such illegal access and use, and that arrangements such as bilateral contracts can adequately address concerns about prior informed consent and benefit 2 See, for example, Submission by Brazil, China, Cuba, Dominican Republic, Ecuador, India, Pakistan, Thailand, Venezuela, Zambia and Zimbabwe (IP/C/W/356); Communication from Mauritius on behalf of the African Group (IP/C/W/206); Co mmunication from Brazil (IP/C/W/228); Communication from India (IP/C/W/161). 5

6 sharing. 3 Other countries still have suggested that practical tensions may arise and that a selfstanding disclosure requirement should be negotiated outside the WTO. 4 At the CBD, issues of intellectual property and access and benefit sharing have been discussed in a number of forums, with a focus on the role of intellectual property in benefit sharing arrangements, and on the need for disclosure of the origin of genetic resources in intellectual property applications. Intellectual property rights in benefit sharing arrangements. In relation to the role of intellectual property in benefit sharing arrangements, the CBD Secretariat has noted that it has been argued that intellectual property rights may be a means to ensure benefit-sharing. This could be achieved through different mechanisms such as: joint ownership, sharing of royalties arising from the exploitation of patents and others. 5 Benefit sharing arrangements are set out in the Bonn Guidelines on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising out of their Utilization, which identifies intellectual property rights in the context of benefits to be shared under mutually agreed terms (Section IV), as well as in Sections V and the Guidelines two appendices (See Box 1). Appendix 1 suggests that access and benefit sharing provisions may include whether intellectual property rights may be sought and if so under what conditions. Additionally, a material transfer agreement for genetic resources may address the assignment, transfer or exclusion of right to claim any property right, including intellectual property rights, over the genetic resources received through the material transfer agreement. Disclosure of origin. In relation to the disclosure of origin of genetic resources in intellectual property rights applications, the CBD Secretariat has noted that it has been argued that intellectual property rights could encourage access and benefit sharing, if applications for such rights required: (i) identification of the source of genetic materials used in the development of subject matter which is to be protected by intellectual property rights; and (ii) proof of prior informed consent of the competent national authority of the provider country, if the genetic resource was acquired after the Box 1 - Bonn Guidelines At its sixth meeting, the CBD Conference of Parties adopted the Bonn Guidelines on Access to Genetic Resources and Fair and Equitable Sharing of the Benefits Arising out of their Utilization (see Decision VI/24A). These voluntary guidelines are designed to assist governments and other shareholders to develop legislative, administrative or policy measures on access and benefit sharing and/or in negotiating contractual agreements for access and benefit sharing. The guidelines cover a range of subjects including the role of national focal points and competent authorities, participation of stakeholders, the process of access and benefit sharing including prior informed consent and mutually agreed terms, and an illustrative list of monetary and nonmonetary benefits. 3 See, for example, Communication from the United States (IP/C/W/257). See also, Communication from the United States (IP/C/W/209). 4 See, for example, Submission by the European Communities under Paragraph 32(ii), Review of Article 27.3(b) of the TRIPS Agreement, and the Relationship between the TRIPS Agreement and the Convention on Biological Diversity (CBD) and the Protection of Traditional Knowledge and Folklore (WT/CTE/W/223). See also, Communication from the European Communities and their Members States (IP/C/W/254). 5 Submission by Executive Secretary of CBD to the TRIPS Council and CTE, entitled Review of the Provisions of Article 27.3(b), Relationship between the TRIPS Agreement and the Convention on Biological Diversity and the Protection of Traditional Knowledge and Folklore (IP/C/W/347/Add.1 and WT/C/W/210). 6

7 entry into force of the Convention on Biological Diversity and does not fall within the scope of the multilateral system set up by the International Treaty on Plant Genetic Resources for Food and Agriculture. 6 Issues of disclosure have also been addressed by the CBD s Conference of Parties in Decision VI/24, which invites Parties and Governments to encourage the disclosure of the country of origin of genetic resources in applications for intellectual property rights, where the subject matter of the application concerns or makes use of genetic resources in its development, as a possible contribution to tracking compliance with prior informed consent and the mutually agreed terms on which access to those resources was granted. It also requested information gathering on a range of related issues (see Box 2). Capacity building needs in relation to access and benefit sharing was explicitly discussed at the Conference of Parties sixth meeting, at which Parties decided to convene an open-ended workshop on capacity-building for access to genetic resources and benefit-sharing in view of developing a draft action plan on capacity-building for access and benefit-sharing. The workshop, held in December 2002, developed a draft action plan which will be submitted for adoption to the COP at its seventh meeting in 2004 (see Decision VI/24B). 7 Box 2 Decision VI/24 In Decision VI/24, the Conference of the Parties [r]equests the Executive Secretary, with the help of other international and intergovernmental organizations such as the World Intellectual Property Organization to undertake further information gathering an analysis with regard to: a) Impact of intellectual property regimes on access to and use of genetic resources and scientific research; b) Role of customary laws and practices in relation to the protection of genetic resources and traditional knowledge, innovations and practices, and their relationship with intellectual property rights; c) Consistency and applicability of requirements for disclosure of country of origin and prior informed consent in the context of international legal obligations; d) Efficacy of country of origin and prior informed consent disclosures in assisting the examination of intellectual property rights applications and the re-examination of intellectual property rights granted; e) Efficacy of country of origin and prior informed consent disclosures in monitoring compliance with access provisions; f) Feasibility of an internationally recognized certificate of origin system as evidence of prior informed consent and mutually agreed terms; and g) Role of oral evidence of prior art in the examination, granting and maintenance of intellectual property rights. In addition multilateral frameworks such as the Bonn Guidelines and the International Treaty on Plant Genetic Resources (discussed below in Section 3.C), a number of regional frameworks to provide guidance on access and benefit sharing have been developed. Andean Pact countries have adopted a legally binding framework for access to genetic resources and benefit sharing (Decision 391). African countries, through the Organization of African Unity, have developed an African Model Law for the Protection of the Rights of Local Communities, Farmers and Breeders, and for the Regulation of Access to Biological Resources. Central American coun-tries have developed an Agreement on Access to Genetic Resources and Bio-chemicals and Related 6 Id. 7 The draft action plan is available in Annex 1 of the report of the workshop (document UNEP/CBD/ABS/EW-CB/1/3). See also, Note by CBD Secretariat, Capacity-Building for Access to Genetic Resources and Benefit Sharing: Synthesis of Submissions Received on Needs, Priorities and Existing Initiatives, and Additional Elements for Consideration in the Development of an Action Plan (UNEP/CBD/ABS/EW-CB/1-2 at paragraph 4). 7

8 Traditional Knowledge. And countrie s in the ASEAN region have developed a Framework Agreement on Access to Biological and Genetic Resources. In addition, a number of national laws now explicitly address issues of access and benefit sharing. Notably, at the recent World Summit on Sustainable Development govern-ments called for action to negotiate within the framework of the Convention on Biological Diversity, bearing in mind the Bonn Guidelines, an international regime to promote and safeguard the fair and equitable sharing of benefits arising out of the utilization of genetic resources (paragraph 44(o)). Active partici-pation in this process, as well as discussions at the WTO and other relevant international and regional forums relating to intellectual property and environment, will require significant capacity on the part of developing countries. B. Traditional knowledge Like the relationship between intellectual property rights and genetic resources, the relationship between intellectual property rights and the knowledge, innovations and practices of indigenous and local communities (traditional know-ledge) embodying traditional lifestyles relevant for the conservation and sustainable use of biological diversity is multifaceted. Discussion has centered around the need for defensive protection of traditional knowledge against misappropriation (through, for example, the inclusion of disclosure requirements in existing patent systems); for positive protection of traditional knowledge (through, for example, existing forms of intellectual property rights, bilateral contracts, customary law protocols, sui generis systems, and other approaches); and about where these issues should be addressed at which level (national, regional, international) and in which institution (CBD, WTO, WIPO). On one hand, views have been expressed that the existing intellectual property system contains sufficient mechanisms for defensive protection, and that existing intellectual property rights combined with bilateral contract-based approaches can provide sound positive protection for traditional knowledge. Others have argued that modifications to the intellectual property system (including the TRIPS Agreement) are required to ensure defensive protection, and new systems, at both the national and international le vels, are required to offer positive protection of traditional knowledge. Some brief comments on these issues are offered below, with particular reference to discussions at the WTO, CBD and WIPO. At the WTO, discussions regarding traditional knowledge have to date taken place primarily in the context of the review of Article 27.3(b). 8 According to the WTO Secretariat, these discussions have raised a set of issues concerning: the granting of patents in respect of traditional knowledge, issues concerning consent and benefit sharing, and issues of a more general nature. 9 Granting of patents in respect of traditional knowledge. In relation to the granting of patents in respect of traditional knowledge such as knowledge relating to tumeric, neem and the ayahuasca vine some WTO Members have argued that patents taken by entities other than traditional knowledge-holders covering such knowledge amount to unauthorized appropriation. Others have responded that if patents are improperly granted, the patent system provides remedies, and that if parties other than traditional knowledge holders obtain a patent protection, then the patent should be cancelled. Members have discussed areas where it has been said the patent system is not working well enough including the definition of prior art, and the adequacy of information on prior art and have discussed whether the 8 See, Note by the WTO Secretariat, The Protection of Traditional Knowledge and Folklore: Summary of Points Made, (IP/C/W/370). 9 See IP/C/W/370. This typology of issues, and much of the discussion that follows, is based on the WTO Secretariat s analysis contained in its summary of discussions by WTO Members of this issue. 8

9 development of databases on traditional knowledge would help prevent misappropriation. As noted above in relation to genetic resources, some WTO Members have argued for a requirement on patent applicants to disclose any traditional knowledge used in the invention. Consent and benefit sharing. In relation to issues concerning access and benefit sharing, WTO Members have discussed arrangements for positive protection of traditional knowledge including through procedures to facilitate prior informed consent and benefit sharing. According to the WTO Secretariat, discussions have centered around four topics: 1) use of the existing intellectual property rights such as copyrights, patents, plant variety protection, and geographical indications; 2) use of improved disclosure requirements to ensure patent applicants disclose traditional knowledge in their patent application, and provide evidence of prior informed consent and benefit sharing arrangements; 3) bilateral contracts between knowledge-holders and companies backed up by legislation; and 4) sui generis systems of protection. 10 General issues where should decisions be made? WTO Members have also raised more general issues arise concerning why there is need for international action on the protection of traditional knowledge and the international forum/forums most appropriate to pursue such a work. 11 According to the WTO Secretariat, WTO Members supporting international action have expressed concern about intellectual property rights covering traditional knowledge being granted to persons other than the holders of that knowledge, and about traditional knowledge being used without authorization or benefit sharing. The WTO Secretariat has classified the reasons put forward in support of international action as including: common economic interests, equity, food security, culture, environment, development, and coherence of international and nationa l law. 12 In relation to the appropriate international forum/forums for further work, they note that two main views seem to exist: one is that priority should be given to the ongoing work in WIPO and other relevant international forums; the other is that all relevant forums, including the TRIPS Council, should pursue work on this matter in parallel and in a mutually supportive way. At the CBD discussions of traditional knowledge have largely taken place in an Ad Hoc Openended Working Group of Article 8(j) and related provisions, and in the Conference of Parties. The Working Group has met twice since may 1998 and has discussed a range of issues. At its second meeting, it considered, inter alia, an Assessment of the effectiveness of existing subnational, national and international instruments, particularly intellectual property rights instruments, that may have implications for the protection of the knowledge, innovations and practices of indigenous and local communities, and offered a series of recommendations to the sixth meeting of the Conference of Parties (see UNEP/CBD/COP/6/7, and Decision VI/10). In Decision VI/10 and Decision VI/24C, the Conference of Parties: invites Parties and Governments to encourage the disclosure of the origin of relevant traditional knowledge, innovations and practices of indigenous and local communities relevant for the conservation and sustainable use of biological diversity in applications for intellectual property rights, where the subject matter of the applications concerns or makes use of such knowledge in its development. In this decision, the Conference of Parties also invited Parties and Governments, with the assistance of the World Intellectual Property Organization, to take into account traditional Id., at paragraph Id., at paragraph8. 9

10 knowledge in the examination of novelty and inventive step in patent applications, and invited the WIPO Intergovernmental Committee to examine and consider mechanisms to protect traditional knowledge, such as the disclosure of the origin of relevant traditional knowledge in applications for intellectual property rights. In the preamble to Decision VI/10, the Conference of Parties noted paragraph 19 of the WTO Doha Ministerial Declaration. It also recognizes that the Convention on Biological Diversity is the primary international instrument with the mandate to address issues regarding the respect, preservation and maintenance of knowledge, innovations and practices of indigenous and local communities embodying traditional lifestyles relevant to the conservation and sustainable use of biological diversity. The Conference of Parties invites Parties and Governments, with the approval and involvement of indigenous and local communities to examine the feasibility of establishing mechanisms to protect the traditional knowledge, innovations and practices of these communities taking into consideration customary laws and practices, and subject to national legislation. In relation to sui generis protection of traditional knowledge, the Conference of Parties in Decision V/26 reaffirms the importance of systems such as sui generis systems and others for the protection of traditional knowledge of indigenous and local communities and the equitable sharing of benefits arising from its use to meet the provisions of the Convention, taking into account the ongoing work on Article 8(j) and related provisions. At its sixth meeting, the Conference of Parties noted the need for additional work on sui generis systems, and requested the Ad Hoc Working Group on Article 8(j) to consider issues including clarification of terminology, compiling of existing sui generis systems, identifying the main elements to be taken into consideration in the development of sui generis systems, and the equitable sharing of benefits. The Ad Hoc Working Gro up is to take into account the work of the WTO and WIPO with a view to promote mutual supportiveness, and existing regional, subregional, national and local initiatives. C. Agriculture and biodiversity According to the Food and Agriculture Organization, agricultural biodiversity encompasses the variety and variability of animals, plants and micro-organisms which are necessary to sustain key functions of the agroecosystem, its structure and processes for, and in support of, food production and food security. 13 As such, agricultural biodiversity provides an essential foundation for efforts to secure sustainable agriculture, address rural poverty and promote sustainable development. The conservation and sustainable use of agricultural biodiversity is affected by a range of factors, including intellectual property rights. Intellectual property rights such as patents and plant breeders rights may affect incentives for the maintenance of existing crops, for the development of new domestic crop varieties, and for agricultural practices regarding the sharing and saving of seeds. A wide range of issues arise at the interface of intellectual property and agricultural biodiversity, including those identified below. Access and benefit sharing for plant gene tic resources for food and agriculture. One set of issues arises from the relationship between intellectual property rights, and efforts to ensure access and benefit sharing for plant genetic resources for food and agriculture. At the international level, the International Treaty on Plant Genetic Resources for Food and Agriculture now provides a legally binding treaty with the objective of the conservation and 13 See, 10

11 sustainable sue of plant genetic resources for food and agriculture and the fair and equitable sharing of the benefits arising from their use, in harmony with the Convention on Biological Diversity, for sustainable agriculture and food security. It establishes a multilateral system to facilitate access and benefit sharing through the use of materia l transfer agreements that will cover a range of food and fodder crops as well as the ex situ collections of those crops held by the international agricultural research centers that are part of the Consultative Group on International Agricultural Research (CGIAR). By effectively pooling these resources, the International Treaty ensures the availability and multilateral transfer of a range of crops, thereby contributing to the maintenance of agricultural biodiversity. Importantly, the International Treaty s provisions on plant genetic resources call for mutually supportive implementation of the International Treaty with the TRIPS Agreement and the CBD (including the Bonn Guidelines). Ensuring this happens in practice will require close cooperation among po licy-makers in different fields, and coordination of approaches at both the national and international levels. Sui generis systems of plant variety protection. A second set of issues arises around the development of sui generis systems of plant variety protection. The TRIPS Agreement requires WTO Members to protect plant varieties either by patents or by an effective sui generis system or a combination of both (Article 27.3(b)). What constitutes an effective sui generis system has created some debate. Some WTO Members have promoted the International Convention for the Protection of New Varieties of Plants (commonly known as UPOV) as the effective model. The two versions of this Convention known as UPOV 1978 and UPOV 1991 provide progressively stronger standards of protection for plant breeders. Other WTO Members (notably some developing countries) have preferred to remain as members of UPOV 1978, or to remain outside the system and develop their own effective sui generis systems that are tailored to address their specific agricultural, food security and development needs. The appropriate response will depend on a range of factors at the national level, and should be carefully explored by policy-makers in consultation with farmers, industry, indigenous and local communities and other stakeholders. Farmers rights and privileges. A third and related issue is the appropriate balance between the rights granted to plant breeders, and the rights and privileges of farmers to engage in traditional agricultural practices such as saving and sharing their seeds. The International Treaty refers to farmers rights and encourages countries to take specific measures to assist farmers in their role as the guardians of biological diversity, and to ensure that farmers share in the benefits of further improvements of plant genetic resources. Farmers rights to save, use, exchange and sell farm-saved seeds are not limited by the International Treaty, but rather are subject to Party s national legislation. UPOV 1991 develops what is termed farmers privilege and provides that the breeder s rights in relation to plant varieties may be restricted in order to permit farmers to use for propagating purposes, on their own holdings, the product of the harvest which they have obtained by planting the protected variety. UPOV 1978, by contrast, makes no reference to the right or privilege of farmers to re-sow seeds and is consequently more flexible than UPOV 1991 in this regard as it permits national legislation to allow farmers not only to re-sow seeds on their own holdings, but also to exchange and sell farm-saved seeds. The appropriate balance between the traditional rights of farmers and state-granted rights to plant breeders is again an issue that should be carefully examined by policy-makers in consultation with relevant interested parties. In addition to these issues, a number of other issues have been raised in the context of intellectual property rights and agricultural biodiversity. How can intellectual property rights contribute to the creation of incentives for pro-poor research, and research into the needs of small farmers and 11

12 specific environmental contexts? What is the relationship between intellectual property rights and the level of genetic diversity in new crop varieties, and what are the implications for the environment, and for crop vulnerability to disease and drought? Resolving these and other critical questions for sustainable development in the agriculture sector will require significant additional capacity for national policy-makers, especially in developing and transition countries. E. Technology transfer What technology is required to help achieve the objectives of the Convention on Biological Diversity, and how do intellectual property rights such as patents or systems for plant variety protection affect its creation, transfer and dissemination? How does the TRIPS Agreement address technology transfer issues? What is the relationship between intellectual property and technology transfer? The relationship between intellectual property and technology transfer is complex, but some general observations can be made. In some cases (especially where technology is easily copied) strong domestic intellectual property rights regimes can encourage technology transfer by reassuring technology owners that their rights will be protected. Intellectual property rights are, however, one of a number of factors that will affect incentives to transfer technology. Others, such as access to markets and infrastructure and opportunities for foreign direct investment may be at least as, or more, important. Additionally, in some cases strong intellectual property rights may allow owners to raise prices and thus limit the extent to which technology is available on fair and favorable terms. Intellectual property rights may also limit transfer through reverseengineering or copying thereby reducing technology flows. Careful consideration must also be given to the nature of technology transferred, and to whether it promotes or undermines efforts to conserve and sustainably use biological diversity. The relationship between intellectual property and technology is complex, and requires careful consideration by policy-makers as they further develop national rules for both intellectual property and the environment, bearing in mind developments at the WTO and the CBD. According to the Chairman s Summary of the 21 October 2001 UNEP-sponsored meeting entitled Enhancing Synergies and Mutual Supportiveness of MEAs and the WTO, the relationship between TRIPs (e.g. Arts. 7, 8 and 66.2) and the provisions in MEAs for the transfer of environmentally sound technology could be further explored by UNEP, MEAs and the WTO. 14 The Convention on Biological Diversity identifies two main categories of technologies. It includes both technologies that are relevant to the conservation and sustainable use of biological diversity or make use of genetic resources and do not cause significant damage to the environment (emphasis added) (Article 16(1)). Technologies relevant to conservation and sustainable use will mostly belong to the category of environmentally sound technologies of the kind discussed in Chapter 34 of Agenda Technologies that make use of genetic resources will generally fall into the category of biotechnologies; Chapter 16 of Agenda 21 offers some policy guidance on the environmentally sound management of biotechnology. 16 Technologies falling into either category will often be covered by intellectual property rights. 14 see 15 See, Legal and Socio-economic Aspects of Technology Transfer and Cooperation, Note by Executive Secretary (UNEP/CBD/MYPOW/5) 9 January 2003 at paragraph Id, at paragraph 7. 12

13 The CBD provides that access to and transfer of appropriate technology is an essential element in achieving its objectives (Article 16(1)). 17 Among other things, it states that technology shall be provided under fair and most favourable terms, including on concessional and preferential terms where mutually agreed and on terms which recognize and are consistent with the adequate and effective protection of intellectual property rights (Article 16(2)). As such, the Convention strikes a balance between the need to protect intellectual property rights and to promote transfer of technology on fair and favourable terms. The Convention also states that Parties, recognizing that patents and other intellectual property rights may have an influence on the implementation of this Convention, shall cooperate in this regard subject to national legislation and international law in order to ensure that such rights are supportive of and do not run counter to its objectives (Article 16(5)). At the WTO, issues of technology transfer have arisen at the TRIPS Council, the Working Group on Technology transfer, and to a lesser extent at the Committee on Trade and Environment. The objectives and principles of the TRIPS Agreement affirm the importance of technological innovation and of the transfer and dissemination of technology. The TRIPS Agreement states that the protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations (Article 7). It underlines that measures may be required to prevent the abuse of intellectual property rights by rights holders or the resort to practices that adversely affect the international transfer of technology, provided that they are consistent with the provisions of the Agreement (Article 8.2). And it obliges developed countries to provide incentives to provide incentives to their enterprises and institutions to promote technology transfer to least developed countries (Article 66.2). In the context of public health, Members have also discussed use of the Agreement s flexibility mechanisms, such as compulsory licensing (Article 31) and exceptions to patentability (Article 30). Issues of access to and transfer of technology have also been discussed at the Working Group on Trade and Transfer of Technology, established at the recent WTO Ministerial in Doha to explore the relationship between trade and transfer of technology, and of any possible recommendations on steps that might be taken within the mandate of the WTO to increase flows of technology to developing countries (paragraph 37). Issues of technology transfer will continue to be discussed at the WTO in a range of bodies, including the Working Group on Trade and Technology Transfer and the TRIPS Council. It will also be discussed in detail by the CBD Conference of Parties at its seventh meeting, to be held in Malaysia, in the first quarter of In preparation for this meeting, technology transfer issues are being discussed in the context of the Open-ended Inter-sessional Meeting on the Multi-year Programme of Work. In a background note for the March 2003 meeting, the Executive Secretary explores the legal and socio-economic aspects of technology transfer and cooperation, including the relevant provisions of the Convention, the identification of transfer opportunities, arrangements for actual technology transfer, issues relating to technology adaptation, as well as a general analytical framework for considering technology transfer issues as they relate to the Convention. It also identifies a number of recommendations that the Meeting may wish to make to the Conference of Parties, including an invitation to Governments and Parties to review the 17 For a detailed discussion of the CBD s provisions on technology transfer, see Note by the Executive Secretary entitled Legal and Socio-Economic aspects of Technology Transfer and Cooperation, (UNEP/CBD/MYPOW/5). It states that Issues relating to technology transfer and cooperation are addressed in Articles 16, 18 and 19. In addition, training and research, so essential for establishing national capacities to absorb technologies, are addressed in Article 12. (at paragraph 4) 13

14 impact of intellectual property rights on the transfer of technologies of relevance under Article 16, and submit information thereon to the Executive Secretary. 18 F. The development dimension Cutting across each of the issues discussed above, as well as other issues arising in the relationship between intellectual property and the environment, is the central need to safeguard and promote the interests of developing countries. For each of these issues, what are the main dimensions relating to development? How will existing and proposed future rules in this realm affect developing country interests economic, social and environmental? What practical and legal changes are required to ensure that the various dimensions of development are taken fully into account? The need to consider the development dimension has been emphasized in the Doha Ministerial Declaration. WTO Members have stated that the TRIPS Council, when examining the relationship between the TRIPS Agreement and the Convention on Biological Diversity, the protection of traditional knowledge and folklore, shall be guided by the objectives and principles set out in Articles 7 and 8 of the TRIPS Agreement and shall take fully into account the development dimension (paragraph 19). More broadly, WTO Members have emphasized the need to place the interests of developing countries at the heart of the trading system. They have stated that: The majority of WTO Members are developing countries. We seek to place their needs and interests at the heart of the Work Programme adopted in this Declaration. Recalling the Preamble to the Marrakesh Agreement, we shall continue to make positive efforts designed to ensure that developing countries, and especially the least-developed among them, secure a share in the growth of world trade commensurate with the needs of their economic development. In this context, enhanced market access, balanced rules, and well targeted, sustainably financed technical assistance and capacity-building programmes have important roles to play. (paragraph 2) These statements in the Ministerial Declaration are paralleled by a similar emphasis in the related Decision on Implementation-Related Issues and Concerns (WT/MIN(01)/17), in which WTO Members noted that they are Mindful of the importance that Members attach to the increased participation of developing countries in the multilateral trading system, and of the need to ensure that the system responds fully to the needs and interests of all participants (preamble). Collectively, these are important references ones that have been reflected in other meetings such as the WSSD. 19 Transferring them from paper to practice will require a proactive approach by governments to articulate development-related concerns in a number of different forums. It would be assisted by a clearer agreement among countries of what constitutes the various dimensions of development e.g. economic, social and environmental that discussions should consider, the relevant goals associated with each of these dimensions, and of the role of trade and trade rules (including those relating to intellectual property) as a means of implementing these goals. G. Other issues The issues introduced in this paper of intellectual property, genetic resources, traditional knowledge, agricultural biodiversity, and development are at the center of discussions relating 18 Id., paragraph See, for instance, paragraphs 84 to 92 of the WSSD Plan of Implementation. 14