The quest for fair, equitable and sustainable exchange and benefit sharing

During the decade-long operation of the CBD, there has been a considerable accumulation of experience on the issue of access to genetic resources and the equitable sharing of benefits arising out of the utilisation of genetic resources. Chee Yoke Ling considers some of the lessons that can be drawn from this experience.

A CENTRAL principle of the Convention on Biological Diversity is ‘prior informed consent’, be it of the country of origin or source where biological resources are collected or a local community whose knowledge is being tapped.

Prior to the CBD, enforcement of the sovereign right over natural resources was a matter purely for national governments. There was massive collection and removal of plant genetic resources for agriculture, of wild genetic resources from forests, waters and soils and the appropriation of the knowledge of indigenous peoples and local communities. The dominant beneficiaries were the agribusiness and pharmaceutical corporations.

The advent of biotechnology, especially genetic engineering, escalated the hunt for genes or bio-prospecting. This came hand in hand with patent claims over life forms, first recognised in the United States and then globalised in the World Trade Organisation’s (WTO) Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). The most significant development was the validification of a patent on a genetically engineered microorganism by a 5-4 majority of the US Supreme Count in the famous Chakabarthy case. The result is Article 27.3(b) of the TRIPS Agreement that requires WTO Members to allow  patenting of microorganisms in their national laws.

The drafters of the CBD were thus confronted with a major task. In response to the biopiracy by the North of the South’s natural resources and traditional knowledge, the rights and obligations of parties involved in using biological resources and associated traditional knowledge had to be defined. The concept of biodiversity as a ‘common heritage of mankind’ did not take root as this would then create an almost ‘automatic’ right of access for bio-prospectors, thereby deepening the exploitation of local communities and countries of the South. The sovereignty of States over their own biological resources was reaffirmed, though countries recognised that the ‘conservation of biological diversity is a common concern of humankind’.

The CBD has three resulting objectives:

·        Conservation of biological diversity;

·        Sustainable use of the components of biological diversity;

·        Fair and equitable sharing of benefits derived from the sustainable use of components of biological diversity.

Provisions on access and benefit sharing

Article 15 of the CBD contains the key provisions on the issue of access to genetic resources and the equitable sharing of benefits arising out of the utilisation of genetic resources. This provision attempts to define the relationship between providers and users of biological and genetic resources, by laying down the following fundamental principles:

·        recognition of nation states’ sovereign rights over biological resources;

·        facilitation of access to genetic resources, for environmentally sound uses, subject to prior informed consent; and

·        fair and equitable sharing of  the results of research and development and the benefits arising from commercial or other use of genetic resources.

‘Mutually agreed terms’ are an element of access and benefit sharing (ABS) to be worked out within national frameworks.

The CBD, recognising the role of indigenous and local communities in the conservation and sustainable use of biological diversity, also provides that the benefits arising from their knowledge, innovations and practices should be equitably shared. Parties are to protect and encourage the customary use of biological resources in accordance with traditional cultural practices that are compatible with conservation or sustainable use requirements, and this is contained in Article 8(j) of the CBD. The Ad Hoc Open-Ended Working Group on Article 8(j) and Related Provisions has considered the Bonn Guidelines on ABS and will present a report to COP7.

The World Summit on Sustainable Development’s (WSSD) Plan of Implementation in Paragraph 42(j) states that ‘Subject to national legislation, recognise the rights of local and indigenous communities who are holders of traditional knowledge, innovations and practices, and, with the approval and involvement of the holders of such knowledge, innovations and practices, develop and implement benefit-sharing mechanisms on mutually agreed terms for the use of such knowledge, innovations and practices’.

The CBD clearly makes a dramatic shift from unfair exploitation (even theft) to a legally binding system of exchange. Many developing countries wanted to have a full protocol on access and benefit sharing, fully aware that it was not sufficient to regulate access as countries of origin. Once natural resources and associated traditional knowledge leave a country of origin, it is necessary for the home country of the bio-prospectors and subsequent users to monitor and ensure that the rights of countries of origin and respective local communities are not violated.

The other aspect was the need for countries of origin to cooperate in developing benefit-sharing principles, terms and mechanisms which then become the basis for access. This would be a safeguard against contractual negotiations that risked a ‘race to the bottom’ especially among countries which have common biological resources.  It would also ensure that developing countries can collectively benefit from a truly fair and equitable benefit sharing system.

Therefore benefit-sharing is a prerequisite for access.

Lessons to be drawn

In the 10 years since the implementation of the CBD, there has been considerable experience accumulated, including national laws, administrative measures, bio-prospecting agreements and other arrangements with their varied terms of benefit-sharing and their actual impact in achieving the CBD objectives.

Lessons can be drawn from these. Firstly, the regulation of access without corresponding enforcement obligations by users’ home countries means that there is no monitoring and enforcement of the rights of countries of origin and their respective indigenous peoples and local communities. Navigating the IPR system of developed countries is beyond the capability of developing countries, and they should not be the parties to shoulder that responsibility in the first place.

Related to that is the flow of information in tracking the movement of the biological resources and associated traditional knowledge, from collection to research and development and then on to commercialisation. For example, the issuance of patents by the US Patent Office over uses of neem and turmeric was clearly illegal. It was only when the Government of India was alerted to the patents through citizens’ monitoring and campaigns that they brought legal challenges in the US. This again puts the burden, including high costs, on the developing country of origin.

Secondly, the rapid expansion of patent claims especially in the US and now in the European Union is a direct violation of the spirit and objectives of the CBD. There is a tendency to regard a patent or other form of intellectual property right (IPR) as the primary benefit. The other types of benefits that were envisaged by the CBD and discussed at many levels need to be brought into an international system.

Thirdly, there is a tendency to discuss and debate access and benefit sharing in isolation from the other two CBD objectives, i.e. conservation and sustainable use. The CBD does not promote access to everything and anything or use in any manner. The right to say ‘No’ by a local community or a country of origin is fundamental. The ecological limits to the use of biological resources, applying the Precautionary Principle, are also embedded in the CBD. The ecosystem approach adopted by Parties and the guidelines on sustainable use to be adopted at COP7 are two examples.

Access or exchange?

The CBD is rooted in a spirit of cooperation. The conservation and sustainable use of biological resources takes place vibrantly at the community level, among communities and among countries and institutions, South-South, North-North, and North-South. There are also myriad levels and types of exchange in technology and good practices. The CBD work programmes and decisions would be more faithful to the spirit of the CBD if relations among the various parties at all levels are appreciated and conducted with mutual respect and cooperation. The notion of ‘access’ fails to capture the vision and possibilities of the CBD, while entrenching the reality of exploitation and violation of rights of indigenous peoples, local communities and developing countries.  The way forward would benefit from the spirit of  ‘exchange’.

Benefit from what?

Here we are dealing with benefits from biological resources - in whole or in part, including genes and enzymes. Of these there are naturally occurring organisms such as microorganisms; organisms or parts thereof that are subject to modification such as plant breeding; and organisms and parts thereof that have been genetically engineered. Then there are products that are derived from these organisms or parts thereof. There are different implications flowing from the different levels and types of human intervention in terms of the scope of patents and other IPRs, the types of benefits other than IPRs and the terms of sharing those benefits.

Secondly, we are dealing with benefits from traditional knowledge associated with a naturally occurring biological resource or product; knowledge that is embedded in an organism or product that has been genetically engineered.

What types of benefits?

Patents and IPRs are only one type of benefits, and even then there must be clearly defined scope and limits on what can be claimed under IPRs - in accordance with the basic principle of ‘no ownership of life forms’ and the spirit and objectives of the CBD.

Where IPRs are legitimate and ethical, then the share can be in terms of proportionate royalties or graduated monetary payments at different stages of exchange, research and development of biological resources.

Beyond IPRs, many types of benefits have been identified and can be creatively developed. These include joint venture activities, and incentives for research and development.  

Who benefits?

Underpinning the equity issue of who benefits are the rights of indigenous peoples and local communities, the sustainable development of a country as a whole, the fair and equitable sharing of benefits between countries and within countries and the inter-generational dimension. The latter could mean that in some circumstances, the exercise of prior informed consent leads to no access and exploitation because conservation for the future is a priority.

International regime for benefit sharing

At COP6, the Bonn Guidelines on ABS were finalised and adopted. The Ad Hoc Open-Ended Working Group on Access and Benefit Sharing (Working Group on ABS) set up under the CBD had worked on these Guidelines. However, developing countries in particular were of the view that these Guidelines were inadequate, even with the amendments made at COP6. This issue was taken up at the WSSD in Johannesburg in September 2002. After long negotiations, it was agreed in Paragraph 42(o) of the WSSD Plan of Implementation 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 utilisation of genetic resources’.

The terms of reference, modalities, scope and elements for the ‘international regime’ will have to be determined at COP7. A number of key developing countries want an international legally binding instrument on benefit sharing that would create legally binding rules and procedures that safeguard the rights of provider countries and ensure that user countries fulfil their obligations.

The following are some key principles and elements:

·        the sovereign rights of countries over their own biological resources, including genetic resources;

·        the implementation of prior informed consent from countries of origin, and from indigenous and local communities where their biological resources or traditional knowledge are affected;

·        the clarification of the scope, limits and requirements for allowing patents or other forms of IPRs, in parallel  a clarification process in the WTO of the TRIPS provision on patenting of microorganisms and micro-biological processes, in order to achieve the objectives of the CBD and in accordance with the fundamental principle that there must be no patents on life;

·        the need to present, prior to the issuance of a patent (where the scope of patentability has been clarified), a prior-informed-consent agreement with the country of origin and proof of the legal provenance of genetic resources and/or traditional knowledge that are used in or are part of an invention;

·        the implementation of legally binding user measures;

·        alternative systems of protection of traditional and indigenous knowledge, innovations and practices;

·        alternative types and systems of reward, incentives and benefit-sharing consistent with the objectives of the CBD. 

The debate on ‘mutually agreed terms’ for access to genetic resources is over two approaches. On the one hand, developed countries that are the primary users prefer purely contractual terms to be negotiated at best under the Bonn Guidelines. On the other hand, developing countries have preference for minimum standards to be set that would ensure that any agreed terms are not unfairly extracted from them, or that developing countries would not be pitted against each other by bio-prospectors seeking access.

The operationalisation of ‘prior informed consent’ requires enforcement and monitoring. This is due to the fact that biopiracy continues - both illegal and unethical appropriation of biological resources and traditional and indigenous knowledge by corporations that are now patenting human genes, plants and other biological materials, many of which exist in nature or have been used for generations by farmers and indigenous peoples.

In many respects, legal experts who are part of the developed countries’ delegations, in tandem with the strong interests of transnational corporations, have shaped the international rules on IPRs and the lack of rigorous work at the CBD.

The independent scientific and technological community has not been a sufficient part of the rules setting, resulting in IPR regimes and claims that, from the scientific point of view, are not tenable nor desirable. Already there are growing concerns that the rapid expansion of IPRs (especially patents on genetic resources and related processes) is having a negative impact on research, innovation and development. Many public research institutions and medium/small firms in developed countries are voicing their concerns and objections to patenting of life forms. The adverse impact on developing countries is even more profound.

Meanwhile, the Working Group on ABS set up under the CBD has continued its work to consider, among other things, the need for capacity building identified by countries to implement the Bonn Guidelines. A report is to be submitted to COP7.

Developing countries should consider and define the types of capacity building that are required, that could shape the CBD work programme and financing by the Global Environment Facility (GEF), UN Environment Programme (UNEP) and other relevant institutions. The following could be included:

·        national ABS legislative and policy formulation;

·        capacity to implement functioning ABS system;

·        capacity to determine science and technology policy options that underpin ABS systems;

·        strengthening negotiation capacity (including for international multilateral negotiations, and negotiations of mutually agreed terms for access and benefit sharing agreements).