Corporate concentration

Second, and this follows on from the first issue, GURTs exemplify the way that agricultural research is more and more expensive, commercially oriented and technologically advanced. The consequence of this is that the sector is becoming one in which an ever smaller number of companies are able to enter, while those that are already in it and can compete come to dominate it. In fact, terminator may accelerate this process of corporate concentration, which is already quite noticeable,7 while further undermining public sector research. It may do this by tightening the locks on plant genetic resources so that others must either do without them or pay licencee fees that might prove too financially burdensome for competitors or potential competitors, and public sector institutions (Swanson and Goeschl, 2002, pp. 60-61). Over time, we can expect the market for crop seeds to be dominated by a small number of large firms producing only GURT seeds.

To ensure that such problems do not arise, countries need to adopt competition regulations that ensure that farmers and consumers continue to have a choice and that maintain the public sector's freedom to operate in agricultural research. One possible measure they might consider is compulsory licensing. However, one should bear in mind that if companies cannot easily capture the benefits from technological innovation through the patent system, this may make them even more determined to control markets through other means, such as by taking over supply networks and by integrating horizontally so they can market 'packages' of products that need to be used together (Rangnekar, 2002, p. 1016).8 This issue is difficult to resolve, but at least forces us to reflect upon what should be considered an appropriate rate of return on private investments.

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