The Biodiversity Treaty Challenges Intellectual Property Rights

Roger J. Marzulla and Laura M. Reifschneider*

Efforts to limit access to natural resources and markets, to diminish existing intellectual property rights protection that, traditionally, has encouraged research, development and innovation, and to alter the economic balance between the developed and developing countries of the world are growing in intensity and visibility. These efforts are taking place primarily under the Convention on Biological Diversity, a multilateral environmental agreement launched at the 1992 United Nations Conference on Environment and Development in Rio de Janeiro. Ensuring continued access to natural resources and the existence of a reasonable international regulatory scheme that does not impose prohibitive transaction costs or undermine protected intellectual property rights ("IPRs") requires ongoing monitoring of developments in the international regulatory process by the private sector, including pharmaceutical, biotechnology, biomedical, and agri-business industries.

The Convention on Biological Diversity "(CBD)" is an international agreement governing the conservation and use of the world's biological resources, whether or not they are endangered or threatened. Its stated goals are threefold:

(a) the conservation of biological diversity;

(b) the sustainable use of its components; and

(c) the equitable sharing of the benefits

arising out of the utilization of genetic resources, including appropriate access to resources and transfer of relevant technologies.

The CBD therefore impacts access to natural resources, use, handling, and genetic modification of resources, and dictates certain key financial components of business arrangements between countries and their citizenry concerning use and ownership of benefits deriving from such resources.

The CBD entered into force on December 29, 1993, when it was ratified by a threshold number of countries, and has now been ratified by at least 134 countries. The Bush Administration refused to sign the CBD in 1992 in Rio, citing, among other things, dissatisfaction with the protection afforded intellectual property rights under the final text of the Convention.

President Clinton signed the CBD on June 5, 1993, however, the United States Senate has not yet ratified it. Lack of protection of intellectual property provisions of the CBD remains one of the primary grounds for Congressional and industry objections to ratification of the Convention. Richard J. Blaustein, Convention on Biological Diversity Draws Attacks, The National Law Journal, October 28, 1996, at C-39. American companies remain affected by the CBD, however, to the extent they are doing business with other countries that are member parties or seek access to resources located outside of the United States. Further, the Clinton Administration has declared that ratification of the CBD will be one of its top foreign policy and environmental goals in the President's second term. Address by Warren Christopher, Stanford University, April 9, 1996, U.S. Department of State, at 3.

The CBD, unlike its predecessors, takes a comprehensive, as opposed to sectoral, approach to conservation, meaning that it will consider problems in the context of entire ecosystems. The Convention also rejects the tradition of viewing the earth's biodiversity as the "common heritage of mankind" and, instead, emphasizes sovereign rights over biological resources, while simultaneously recognizing that conservation of biological diversity is a "common concern" of mankind. The text of the CBD provides that access to resources and transfer of technology shall be provided on terms consistent with the "adequate and effective" protection of intellectual property rights. Indeed, protection of intellectual property rights often is justified as providing the necessary incentive for investment in creative activities and to promote research and development and technology transfer. Affording such protection has been opposed, however, on the grounds that protection of IPRs is at odds with the purposes and goals of the Convention. In seeking to establish the "equitable sharing of benefits" from the earth's biological diversity, the CBD threatens to trample intellectual property rights.

The first meeting of the Conference of the Parties, known as "COP-I," was held in Nassau, Bahamas in 1994. COP-I and subsequent conferences of the Parties to the CBD have been attended by as many as 800 to 1,000 individuals, including governmental ministers and officials, international and regional bodies, and non-governmental organizations. Decisions are being made at these gatherings concerning the proper role of intellectual property rights when in conflict with environmental goals and a variety of other issues affecting business such as to access to and use of natural resources. Parties and organizations have objected at these meetings that IPRs reward human ingenuity but ignore the value of the raw material as well as the contribution of indigenous and local peoples in maintaining and developing natural resources. IUCN The World Conservation Union, A Guide to the Convention on Biological Diversity 3 (1994). Private sector representation, unlike that of the environmental community, however, remains quite limited.

IPRs are secured both under national legislation and under international law, primarily, the Agreement on Trade-related Aspects of Intellectual Property Rights Agreement (the "TRIPs Agreement") concluded as part of the Uruguay Round of the General Agreement on Trade and Tariffs ("GATT"). The TRIPs Agreement requires countries to enact national legislation which, among other things:

(1) Extends patenting to microorganisms and "modified" life forms;

(2) Provides patents or other forms of protection to plant varieties;

(3) Extends patent rights over pharmaceutical products;

(4) Increases the duration of protection for patents to 20 years from the date of the application; and

(5) Makes importation of a product equivalent to local working of an invention.

The TRIPs Agreement is seen by many in the Third World and indigenous peoples groups, however, as a "strategy to foster a form of technological protectionism," or a method of "freezing" the comparative advantages of the developed countries vis-a-vis the developing world. World Wildlife Fund for Nature, The Biodiversity Convention & Intellectual Property Rights 8. Another major objection to TRIPs is that the Agreement fails to recognize and protect the contribution of indigenous peoples, farmers and local communities to the innovation or product patented. Commonly cited examples include an exclusive license to insecticides "derived" from the Neem tree in India and a patent on a genetically engineered sweetener "derived" from the thaumatin plant in West Africa.

In response to these concerns, the World Wildlife Fund (WWF), for example, has urged a moratorium on (a) the extension of patents to biotechnological innovations; and (b) the grant of patents where the invention appears to be clearly based on genetic resources found in ex-situ collections until the question of ownership of these resources is resolved. Id. at 3-4. WWF also has proposed modifying the TRIPs requirements so that patent applications in all countries would require disclosure of the country of origin of biological samples, the role that local, rural or indigenous peoples' knowledge, innovations or techniques played in the development of the product and notice to the country and communities concerned in order to provide them with the opportunity to oppose the patent. Id. at 2. Under the WWF proposal, patents would be denied for inventions and processes that "have, or may have, a harmful ecological effect on biodiversity conservation and sustainable development." Id. at 3. Other groups advocate the adoption of a resolution that would, in every case, establish the supremacy of the CBD and its goals over TRIPs and other intellectual property rights agreements.

At the second meeting of the CBD, convened in Jakarta, Indonesia in November 1995 ("COP-II"), the parties decided that a study was needed to analyze the relationship between the Convention's goal of "fair and equitable" sharing of benefits from natural resources and intellectual property rights. The results of this "study," a paper prepared by CBD Secretariat staff which poorly represented the key elements of and need for intellectual property protection, was presented to the parties at COP-III in Buenos Aires in November of 1996.

At COP-III, the Indigenous Peoples Forum called upon the parties to the CBD to establish an alternative system of intellectual property rights. Claiming that 80 per cent of the world's population cures itself based on native knowledge of medicinal plants and that 50 per cent of all medicines sold by pharmaceutical companies are based on "usurped" native knowledge, the group demanded the creation of a system that would protect the knowledge of indigenous peoples and revived WWF's 1996 call for a moratorium on collection of "ethnobotanical" resources in areas inhabited by indigenous peoples. Indigenous Peoples Demand Role In Treaty as Traditional Custodians of Biodiversity, 19 Int'l. Envtl. Rep. (BNA) No. 23, at 1003 (Nov. 13, 1996). In response to this and other statements and argument, the parties decided that case studies should be prepared on the impact of the existing IPR regimes on the CBD's objectives, including benefit sharing with indigenous and local communities. Case studies will also focus on the possibility for creating an alternative system for intellectual property protection consistent with the goals of the CBD.

In the coming years the CBD may continue to complicate the international practice of Intellectual Property Rights law. All aspects of international trade could be affected, especially those sectors dealing with developing economies. As we move towards the next COP, we should take steps to ensure that the protection of Intellectual Property Rights, essential to the advancement of science, remains. Without such protection, those incentives necessary for progress might disappear.

*Roger Marzulla is a partner at Akin, Gump, Strauss, Hauer & Feld, LLP, in Washington, D.C., where he heads their Environmental Section. Laura Reifschneider is an associate in that section.


2001 The Federalist Society