Explanatory Memorandum to COM(2012)576 - Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilization in the Union - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2012)576 - Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilization in the Union. |
|---|---|
| source | COM(2012)576  |
| date | 04-10-2012 |
· Grounds for and objectives of the proposal
The main objective of the proposal for a Regulation of the European Parliament and of the Council on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilization in the Union is to implement the Nagoya Protocol in the Union and to enable Union ratification of this treaty.
· General context
Genetic resources - the gene pool in both natural and cultivated stocks - play a significant and growing role in many economic sectors: 26% of all new approved drugs over the last 30 years are either natural products or have been derived from a natural product.[1]
A broad range of players in the Union, including academic researchers and companies from different sectors of industry (for example, plant and animal breeding, biocontrol, cosmetics, food and beverage, horticulture, industrial biotechnology, pharmaceutical) use genetic resources for research and development purposes, some also use traditional knowledge associated with genetic resources.
The European Union and all of its 27 Member States are Parties to the Convention on Biological Diversity[2] (CBD). The CBD recognizes that states have sovereign rights over genetic resources found within their jurisdiction and the authority to determine access to such resources. The Convention obliges all Parties to facilitate access to genetic resources over which they hold sovereign rights. It also obliges all Parties to share in a fair and equitable way the results of research and development and the benefits arising from the commercial and other utilization of genetic resources with the Party providing these resources.
The CBD also addresses the rights of indigenous and local communities that hold traditional knowledge associated with genetic resources, and which may provide important lead information for the scientific discovery of interesting genetic or biochemical properties.
However, the CBD currently provides little detail on how access and benefit-sharing (ABS) for the use of genetic resources and associated traditional knowledge should be done in practice. Actors at the beginning of the genetic resources value chain in the Union (mostly collections and academic researchers) are in direct contact with the laws and authorities of provider countries. These first actors pass on samples of genetic resources and first research results to other users that engage in basic or applied research. Actors situated at the end of the genetic resources engage in often lengthy development activities that require significant investments with uncertain outcomes. They largely depend on material and information passed on to them from earlier users in the chain, including in relation to ABS. In the absence of clear rules or with very burdensome rules in most provider countries, European researchers and companies have repeatedly been accused of biopiracy by countries claiming a violation of their sovereign rights. A clear framework of obligations for all users of genetic resources throughout the value chain is essential for creating an enabling context for facilitated access to quality samples of genetic resources with high legal certainty.
The 'Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from Their Utilization to the Convention on Biological Diversity' (hereinafter: Nagoya Protocol) is a new international treaty adopted on 29 October 2010 by the consensus of the 193 Parties to the CBD. It is a treaty with legally binding effects that significantly expands the general ABS framework of the CBD. The Nagoya Protocol is expected to enter into force in 2014. Once operational, the Nagoya Protocol will generate significant benefits for biodiversity conservation in States that make available the genetic resources over which they hold sovereign rights. It will in particular:
– Establish more predictable conditions for access to genetic resources.
– Ensure benefit-sharing between users and providers of genetic resources.
– Ensure that only legally acquired genetic resources are used.
The Protocol rests on two main pillars: measures on access, and measures on user-compliance.
The access pillar leaves Parties discretion whether they wish to regulate access, and require prior informed consent and benefit-sharing for the use of their genetic resources or not. However, if a Party decides to do so, then it must implement the fairly detailed 'international access standards' set out in the treaty through binding legislation. The Protocol also clarifies that states must engage with their indigenous and local communities in case access is sought to traditional knowledge or to genetic resources held by these communities. Main Protocol principles in relation to access include: (i) government authorities or indigenous representatives must give their prior informed consent before access can take place, (ii) specific benefit-sharing obligations must be set out in private law contracts between a provider and a user, and (iii) access frameworks must be clear and transparent, based on non-arbitrary rules, and result in reliable and timely decisions, in a cost-effective manner.
The user-compliance pillar of the Protocol obliges all Parties to the Protocol to take measures to provide that only legally acquired genetic resources and associated traditional knowledge are utilized within their jurisdiction. Parties must monitor the compliance of users within their jurisdiction and designate one or more checkpoints for this task. They must also take appropriate, effective and proportionate measures in cases where users within their jurisdiction do not comply with their ABS-related obligations. Parties must also ensure that disputes arising from specific benefit-sharing contracts can be taken to court. However, different than in the case of access, the user-compliance provisions of the Nagoya Protocol leave Parties quite some discretion on the type and mix of implementing measures chosen.
Parties to the Protocol will need to make further choices on the temporal application of implementing measures, on the respect for existing specialised ABS instruments[3], and apply special considerations to non-commercial research, to the exchange of genetic resources with pathogenic properties, and to genetic resources for food and agriculture. They will also need to address the relations with non-Parties to the Protocol. All Parties to the Protocol must furthermore establish a National Focal Point on ABS to liaise with the international Secretariat and to respond to information requests by stakeholders. Parties must also designate one or more Competent National Authorities responsible for granting access and advising on applicable procedures for requiring prior informed consent and entering into mutually agreed terms. Parties may designate a single entity to fulfill the functions of both focal points and competent national authority.
The Union and most of its Member States i have signed the Nagoya Protocol and thereby committed themselves to work towards implementation and ratification. Union implementation and ratification of the Protocol will create new opportunities for nature-based research, and contribute to the development of a bio-based economy.[5]
· Existing provisions in the area of the proposal
Neither the implementation of the access nor of the user-compliance pillar of the Protocol is currently addressed in Union-law.
· Consistency with the other policies and objectives of the Union
The EU and its Member States are politically committed to become Parties to the Protocol to secure access of EU researchers and companies to quality samples of genetic resources, based on reliable access decisions at low transaction costs.[6]
The proposal is also consistent with the EU's signature of the Protocol and also with target 16 of the CBD's Strategic Plan which foresees that by 2015 the Nagoya Protocol is in force and operational, consistent with national legislation.
Contents
This initiative is the result of extensive consultations with the general public and relevant stakeholders. Furthermore, the Commission carried out an impact assessment of the proposed policy options which led to the publication of a report.
· Public consultation
The Commission held a web-based public consultation from 24 October to 30 December 2011 to seek feedback on a list of questions that addressed key aspects of Nagoya Protocol implementation. Forthy-three replies were received that represented a much broader number of respondents, since the majority of replies came from European or international associations with hundreds or thousands of members each. The respondents covered most sectors potentially affected by implementation measures under the Nagoya Protocol. The list of questions together with the results of the web-based public consultation have been published in the website of the European Commission under the following link: ec.europa.eu/environment/consultations/abs_en.
· Ad hoc consultations
DG Environment organised a technical meeting on 26 January 2012 including all respondents to the public consultation, Brussels-based representatives of stakeholders, and experts nominated by Member States. At the meeting, the Commission presented its summary of the public consultation, whereas members of the consultant team presented tentative findings of their work. Participants used the opportunity to challenge the consultant team on some of their findings.
DG Environment officials held many meetings with representatives of botanical gardens, culture collections, industry federations or individual companies and participated in various expert conferences on the Nagoya Protocol. The consultant team conducted semi-structured interviews with representatives of stakeholders and companies.
· Consultations with third countries
In 2011, DG Environment asked several EU delegations in third countries to seek information from major partner countries on the state of play and their concrete ideas for Nagoya Protocol implementation. The feedback received was complemented by more detailed bilateral discussions with Australia, Brazil, India, Japan, Mexico and Switzerland.
· Impact Assessment Report
In line with its 'Better Regulation' policy, the Commission has conducted an assessment of the economic, social and environmental impacts of different policy options for implementing the Nagoya Protocol. This report is accessible on the web site of the European Commission (DG Environment). The Commission also contracted a consultancy firm to carry out a study as an input for its report. This study is accessible at the same web site.
The Commission's impact assessment considered a broad range of options for implementing the Nagoya Protocol. Two options for access measures and four options for user-compliance measures were analyzed in-depth. All options were analyzed against a business as usual baseline without implementing measures at EU or Member State level. It also analyzed two options on the temporal application of EU-level measures as well as a range of complementary measures.
The analysis identified the establishment of an EU platform for discussing access to genetic resources and sharing best practices as the preferable option on access, whereas the identified preferable option on user-compliance is a due diligence obligation on EU users complemented by a system to identify collections as 'trusted sources' of genetic resources. The due diligence obligation would only apply to genetic resources and associated traditional knowledge that are acquired after the entry into force of the Nagoya Protocol for the EU. To lower costs and enhance effectiveness, these measures should be complemented by awareness and training activities, work on contractual model clauses, work on technical tools for monitoring and tracking genetic resources flow, and where appropriate through bilateral cooperation with other countries or regions.
The due diligence obligation would ensure that minimum information relevant to ABS is available all throughout the genetic resources value chain in the Union. This will enable all users to know of and respect related rights and obligations. At the same time, the due diligence approach does not prescribe the same type of measures to all users, but leaves users some flexibility to take measures that work best for their respective context, and also to develop sectoral best practices. The system of trusted sources would substantially lower the risk that illegally acquired genetic resources are used in the Union. Acquiring samples for trusted sources would seem particularly beneficial for academic researchers as well as small and medium sized enterprises.
· Summary of the proposed action
The proposal sets out obligations for users of genetic resources and traditional knowledge associated with genetic resources in the Union. It would oblige all users to exercise due diligence to ascertain that genetic resources and traditional knowledge associated with genetic resources used were accessed in accordance with applicable legal requirements and that, where relevant, benefits are fairly and equitable shared upon mutually agreed terms. To that end, all users would need to seek, keep and transfer to subsequent users certain information relevant for access and benefit-sharing. The proposal sets out minimum features of due diligence measures.
To comply, users could build on existing ABS codes of conduct developed for the academic sector and different industries. Associations of users may request the Commission to recognise a specific combination of procedures, tools or mechanisms overseen by an association as best practice. Competent authorities of the Member States would be obliged to consider that the implementation of a recognised best practice by a user reduces that user's risk of non-compliance and justifies a reduction in compliance checks.
This proposal also foresees a system of Union trusted collections that would substantially lower the risk that illegally acquired genetic resources are used in the Union. Collections that wish to be included in the register of Union trusted collection would commit to supply only fully documented samples of genetic resources to third persons for their use. The competent authorities of the Member States will have to verify if a collection meets the requirements for recognition as Union trusted collection. Users acquiring a genetic resource from a collection included in the Union register would be considered to have exercised due diligence as regards the seeking of all necessary information. A system of Union trusted collections will be particularly beneficial for academic researchers as well as small and medium sized enterprises.
Users would be obliged to declare at identified points that they complied with their due diligence obligation. Competent authorities of Member States should check on a risk-based approach whether users comply with their obligations under this Regulation. Member States should also ensure that infringements of this Regulation by users are sanctioned by effective, proportionate and dissuasive penalties.
Finally, the proposed Regulation also foresees the creation of a Union platform on access.
· Legal basis
The proposal is based on the Union's environment policy competence in Article 192(1) of the Treaty on the Functioning of the European Union as it aims at implementing the Nagoya Protocol, a global environmental agreement in favour of the conservation and sustainable use of biological diversity worldwide.
· Choice of instrument
The proposed instrument is a regulation because a regulation is necessary in order to ensure the highest level of harmonization and avoid the coexistence of different standards between Member States.
· The principles of subsidiarity and proportionality
The proposal would comprehensively implement the user-compliance pillar of the Nagoya Protocol. Member States would have discretion whether or not to require prior informed consent and benefit-sharing for genetic resources that belong to them. Their decisions on this would not be a precondition for Union ratification of the Nagoya Protocol.
Only two Member States of the Union have so far developed legislation on access to their genetic resources over which they hold sovereign rights, whereas other Member States have decided to grant free access to their genetic resources. Presently EU-harmonised access measures are not needed. In case a Member State decides to require prior informed consent and benefit-sharing it would have to implement the access-related provisions of the Nagoya Protocol. The proposed Union platform on access would be a non-binding approach for streamlining access conditions in Member States based on the method of open coordination.
A legally binding EU-level intervention on user-compliance is justified as it avoids negative effects on the internal market in nature-based products and services that would result from a fragmentation of user-compliance systems in the Member States and also has the best performance as regards the creation of an enabling context for research and development on genetic resources with benefits for the conservation and sustainable use of biological diversity worldwide.
The proposed due diligence obligation on users of genetic resources and traditional knowledge associated with genetic resources is also proportionate as it would balance the objectives of minimising the risks of the use of illegally acquired genetic resources in the Union and of supporting the fair and equitable sharing of benefits resulting from the use of genetic resources or traditional knowledge associated with genetic resources upon mutually agreed terms with considerations on legal certainty, low transaction costs, and the flexibility inherent in the due diligence concept to take implementing measures that are best suited to different circumstances.
The present proposal does not entail any significant financial implications for the Community budget.
The proposal concerns an EEA matter and should therefore extent to the European Economic Area.