Negotiating Equity over Genetic Resources and Traditional Knowledge

Trade negotiations over knowledge resource issues are marked by diversity and divergence in principles and values in cultural and ethical perspectives, in policy objectives and in trade and property interests, as well as negotiating asymmetries and the impact of technological development. These factors help shape the contested interaction between the regimes that govern custodianship and sovereignty over GR and the regulation of the access to, use of, and sharing of, benefits from GR and associated TK; and the international standards and national laws that govern the grant of patent rights for eligible inventions. The debate has focused on the desirability (from a public policy point of view) and the legitimacy of certain patents that are cited as instances of misappropriation or misuse of GR or TK - patents that are denounced as acts or evidence of biopiracy. The legitimacy of such patents has been challenged on diverse grounds:

1. From the perspective of public policy (taking issue with the legitimacy of patents for inventions based on biological material, or the assertion of private rights in this domain altogether);

2. Lack of conformity with existing patent law principles (suggesting that certain patents lack novelty or inventiveness, or their claims are too broad and insufficiently based on the inventions actually disclosed);

3. Perceived conflict between parallel regulatory goals, since the assertion of private patent rights over such inventions is argued to undercut sovereign rights over the GR used as input for the inventive process;

4. As breaches of laws governing access and use of GR and associated TK;

5. In the absence of applicable laws, as a form of misappropriation of the inherent value of GR and TK contrary to the spirit and objectives of the CBD (conservation of biological diversity, the sustainable use of its components and the fair and equitable sharing of benefits arising from the utilization of GR).

The underlying concern is that GR and associated TK are accessed illegally or, when formal legal constraints are absent, inappropriately or unethically, and then exploited without sharing the benefits equitably with the country or community of origin. To assert IPRs on innovations derived from access to GR has been construed: (i) as an act of direct misappropriation in itself (particularly when it is argued that IPRs cover the GR or TK in the form it was accessed); (ii) as realizing, but inequitably misappropriating, the inherent value of the resource; or (iii) as a symptom or symbol of a more general act of misappropriation or misuse. Charges of 'biopiracy' can raise overlapping concepts of illicit access, unauthorized use, breach of any conditions agreed or prescribed at the point of access, failure to share benefits equitably, filing for patent protection without the agreement of the source country or source community, and a general requirement to conduct research and commercial activities ethically and equitably.

The contemporary debate is fuelled not merely by differing assessments of the relative value of GR and TK as knowledge resources as against the kind of innovation validated by the patent system, but also by differing value systems, which variously privilege in situ biodiversity and TK systems, or modern scientific and technological intervention. The first point of divergence is in the very perceptions of the same knowledge resource that are affected by cultural and economic differences; rivalrous perceptions of the same 'resource' can exhibit the duality of the duck-rabbit figure,3 as Bandyopadbyay and Shiva (1985) observed in discussing the limestone resources in the Doon Valley that are viewed as natural acquifers by traditional users (seeing the interstices as the resource) and as a quarry by miners (viewing the mineral as the resource). At the same time, one seed might be seen: (i) as the germ of a new individual plant or as the harvest of an existing plant; (ii) as an instance of a botanical variety defined by its phenotype; (iii) as a repository of a plant's genome; (iv) as an embodiment of knowledge about its use and management; (v) as distilling and embodying a heritage of breeding and selection; and (vi) as a means of cultural transmission, or as Chen (2001) points out, a 'meme', akin to the 'tunes, ideas, catch-phrases, clothes, fashions, ways of making pots or of building arches' identified by Dawkins (1976). These different perceptions map across to an array of property rights, and other forms of ownership, access and control that converge on the seed. These rights or entitlements differently privilege the physical, informational and cultural aspects of the seed, and map across to the distinct ways of seeing the seed. In terms of the basic distinctions in the law of property, the seed is at once a chose in possession (one takes possession of the seed and enjoys possession by eating or planting it) and the subject of choses in action (one enjoys intangible property rights over the seed by taking an action); in bioprospecting, effective access to the seed is conditional on access to the soil that yields it. Hence, the seed may be:

1. Subject to ownership as personality (a distinct chattel);

2. Associated with landownership or real property governed by a ius fruendi or associated with possession of land at least until it is harvested or prospected: 'whatever is attached to the soil becomes part of it . . . things such as seeds . . . which have hitherto existed as individual movable objects, lose their identity when sown or planted in the ground and become part of the land. Similarly, objects such as crops or fruit or trees, which are ordinarily thought of as things in themselves, and which will become individual movable things once they are detached from the soil, are at present part of it' (Lawson, 1958);

3. Governed by national resource sovereignty more broadly, as well as legal sovereignty in determining the conditions of entry and exit to the country concerned and biosafety and quarantine regulations (which may restrict or condition access to the seed and the right to remove it);

4. The subject of a plant variety right associated with the phenotype of the plant it yields;

5. The subject of a patent claim directed to its genetic content (particularly if it has been inventively transformed);

6. Subject to licensing of associated IPRs or contractual arrangements that will determine its authorized use;

7. Subject to interests linked to its cultural and traditional significance, including farmers' rights.

This array of property and associated claims over the one seed expresses parallel values and value systems. Therefore, divergences in perception correspond with divergent notions of property interests, and are linked to the divergent sets of values and value systems that they are expressing.

A politically sustainable and practically workable international system of governance of knowledge resources would need to reconcile these distinct sets of perceptions, property claims and value systems. Trade negotiations over knowledge resource issues can exaggerate or entrench these divergences, rather than reconcile them. But the very ambiguity and adaptability of value systems suggest one pathway towards reconciliation; contrasting values are more readily accommodated than conflicting property claims. 'Value' is embedded in the very definition of 'GR' in the CBD and the ITPGRFA. What distinguishes GR from 'genetic material' is precisely their 'actual or potential value'. If this sense of value is to be construed in narrow utilitarian terms as the economic exchange value, it would be difficult to fix in a manner that inspired mutual trust; the reference to 'potential value' invokes latent possibilities for downstream exploitation of the resource, an inherently speculative benchmark for valuation closer to a venture capital model than an estimate of the economic value of an ore reserve. The focus on potential value also highlights a contentious characteristic of GR - by virtue of its very definition (they contain 'functional units of heredity') and the non-excludability of a knowledge resource, one single act of access can entail an irreversible appropriation of the full economic or commercial value of genetic material as a knowledge resource (unlike poaching or inequitable exploitation agreements of conventional natural resources, which can be halted or renegotiated without loss of the residual economic value of the resource). Thus, GR can be declared to be 'stolen' or 'misappropriated' through uses that leave the original resource virtually intact. In sum, an exclusive focus on immediate economic value may only exacerbate contention. The legal and policy context of the CBD makes it clear - as should be self-evident - that it is not the simple economic exchange value of a resource that counts; the preamble recalls 'the ecological, genetic, social, economic, scientific, educational, cultural, recreational and aesthetic values of biological diversity and its components'. An explicit acknowledgement that negotiators are working with different perceptions of the resource, and thus different value systems and associated property claims, may be a more enabling approach than a reductive focus on objective economic value. Seeking to fix the value and to claim that it was inequitably appropriated may simply restate the question of which form of valuation should prevail, unless, again, the matter is resolved through a direct bilateral settlement and mutually agreed terms, such as an MTA, which may in turn simply have the effect of deferring the question of the consistency of individual transactions with overarching expectations of equity and fairness. Pace Nozick (1974), developing country governments have argued that agreed contracts for access to GR are inherently inequitable: '[H]owever carefully any model contract is drafted, however ardently such contracts try to correct the huge imbalance between the provider and the user, such an approach simply cannot lead to anything even remotely resembling a fair and equitable regime' (WIPO, 2004, p. 175).

The complex of values surrounding a knowledge resource is richer than the conventional zero-sum analysis or duelling claims of exclusivity. This very complexity opens up important opportunities for constructive partnerships in the use of knowledge resources. Conventionally, the perceived value of a resource would increase as it moves up a 'value-added' chain that reflects the degree of human intervention and the extent of technological transformation of the resource from its naturally occurring form. This can be illustrated by the degree of transformation of a plant resource, as human intervention increases with each step and the targeting of the latent technological value of the resource becomes evermore precise:

• Maintenance of natural biodiversity in situ;

• Ex situ collections of GR and the conduct of essential botanical enquiry (such as plant taxonomy), without significant extraction of physical material;

• Sustainable foraging and traditional usage of naturally occurring resources, and conservation through the application of traditional ecological knowledge;

• Development of new resources through traditional selection, and then through more targeted forms of systematic or 'scientific' breeding;

• Plant breeding through mutagenesis, the deliberate induction of mutation by technological intervention;

• Creation of transgenic organisms, synthetic compounds and industrial processes using the functional units of heredity extracted or derived from GR.

Other conceptions of value would turn this already simplistic hierarchy of added value on its head. From the perspective of some traditional, consumer or civil society voices in the GR debate, the degree of unease and resistance rises with each step up this value-added ladder - the claims of misappropriation are more pronounced, as are concerns that environmental, cultural and ethical value may be lost; the greater the utilitarian or commercial benefit that is extracted, the higher rises the threshold for equity in sharing those benefits. These sets of values are therefore typically seen to be at odds, and this tension drives conflicting claims to property rights and other entitlements to exclude illegitimate behaviour, and different conceptions of the public domain. Negotiations over governance of these knowledge resources would therefore be construed on a linear scale, as a matter of trading off these values. But actual values are rarely defined and structured so neatly as to lend themselves to this kind of precise counterpoint. The assumption that such a linear hierarchy of values can and should be sustained may be unsustainable. This would open the way to reconciling distinct, but not necessarily conflicting, value systems, so as to forge a universal conception of equity in terms of both equitable outcomes and procedural fairness.

One reading of the CBD suggests that reconciliation is not merely possible but is required. The utilization of GR is contemplated as part of a holistic framework for the conservation of biological diversity. Unlike other natural resources (even biological resources), most GR (apart from exceedingly rare resources) have the distinctive quality of lending themselves to conservation in situ and technological and industrial exploitation ex situ at the same time - precisely because, by definition, they contain the functional units of heredity. The very quality that makes access to GR such a sensitive issue - a single sample can be sufficient to realize the full technological potential value of a GR, so one act of access can lead to the full appropriation of that value - also means that the goals of conservation and exploitation need not be in conflict (as they would be for other resources such as the Doon Valley aquifer) but can support one another. Access and utilization in accordance with prior informed consent and equitable benefit-sharing can create incentives for in situ conservation by generating benefits from exploitation of the resource ex situ. This confounds the notions of exclusivity and possession that characterize property and related tort law: 'misappropriation' of a knowledge resource is a kind of conversion or unauthorized taking without necessarily depriving the owner or custodian of possession of the physical resource. Benefit-sharing under the CBD necessarily entails the exploitation of the resources - including as feedstocks for biotechnological research and commercial exploitation of the outcomes of biotechnology - provided overarching safeguards of fairness and equity are complied with. Article 19 provides for 'the effective participation in biotechnological research activities by those Contracting Parties, especially developing countries, which provide the GR for such research, and where feasible in such Contracting Parties' and 'priority access on a fair and equitable basis by Contracting Parties, especially developing countries, to the results and benefits arising from biotechnologies based upon genetic resources provided by those Contracting Parties'. Reflecting the scope for bartering within this general normative framework, access to results and benefits from such biotechnological derivations 'shall be on mutually agreed terms'. Conservation need not exclude utilization, suggesting that the assertion of contrasting value sets and interests need not be zero-sum.

Hence, the CBD creates an expectation - indeed imposes obligations -concerning the fair and equitable sharing of benefits from biotechnological developments based on GR provided by biodiversity-rich countries and the right of prior informed consent, but it also leaves latitude for the terms of access and sharing of benefits to be negotiated and mutually agreed. This requires a clearer framework for setting equitable terms - legally, conceptually and in terms of fairness of the bargaining process - that should reach across cultural differences and diverse value systems, and yield a shared conception of practical equity. The absence of such a framework and the current high levels of activity in patenting biotechnological innovations are perhaps the key drivers of concern that patents may serve more as a means of misappropriation than as a means of structuring equitable benefit-sharing arrangements. However, this is not inherently or inevitably the case, and the CBD appears to contemplate the active patenting of biotechnological innovations based on accessed GR, provided that this is consistent with prior informed consent and any specific terms that are agreed between resource providers and users, and a fortiori is consistent with equitable benefit-sharing from the utilization of the resources (in the light of the objectives of CBD). For instance, the Bonn Guidelines established under the CBD provide for joint ownership of such derivative patents as one form of non-financial benefit-sharing.

Ideally conceived, an equitable model of innovation and its supporting legal framework would bridge two perceived legitimacy gaps: between knowledge resource and innovator, and between innovation and public expectations of widespread benefits. Debate over equity and access typically lacks a positive conception of innovative activity and focuses discretely on access to knowledge resources, on transfer of new technologies and on market access for new technologies, rather than on the innovative process that links these three issues. This limited axiological palette means that innovation itself may be coloured as a form of misappropriation. Negotiations that hinge on conceptions of equitable terms of access and use of knowledge resources have proven difficult to settle at the level of clear, well-defined multilateral principles - and this difficulty is possibly increasing as the scope of engagement broadens and more diverse interests seek recognition in multilateral processes. Simply invoking the notions of equity and legitimacy of access and use can beg deep questions, and may defer or transfer resolution of underlying issues. The polyvalent quality of knowledge resources - the very flexibility that is accorded by their non-excludability - has rendered claims of misappropriation more problematic. But it also points to how exploitation agreements can accommodate the various value sets asserted by actors in the diverse cultural and economic settings that typify problematic knowledge resource transactions. The two 'hard cases' discussed in the following section will illustrate that this is still a highly challenging task, but could ideally illustrate that an inclusive axiological analysis would provide a more enabling platform for more precise legal analysis, for the demarcation of property rights, or for trade negotiations on knowledge resources that are structured by the zero-sum assumption and the logic of trading off between opposed interests; at least, they will chart the difficulties arising when different value sets are not consciously accommodated in knowledge resource negotiations.

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