The Nagoya Protocol 101

Introduction

In our May Newsletter, we invited clients and other newsletter subscribers to submit any relevant IP questions that they wanted Ingentium to answer. Thank you to everyone who submitted a question. One of the most common questions we received however was about the Nagoya Protocol and its impact on research and IP management activities. With that in mind, this blog post will provide some useful information about the Nagoya Protocol. There is also a video version of this blog (a vlog) talking through the Nagoya Protocol which you will find above!

What is the Nagoya Protocol and why has it been implemented?

The Convention on Biological Diversity (“CBD”) is a treaty which was setup in response to the UN’s environmental programme and the growing recognition that biological diversity was and is a global asset of tremendous value to present and future generations. The CBD was signed in 1992 and adopted in 1993 by the Ad Hoc Working Group of Experts on Biological Diversity later known as the Intergovernmental Negotiating Committee. The three objectives of the CBD are to (i) conserve biodiversity and genetic resources, (ii) allow for the sustainable use of such resources and (iii) promote the fair and equitable sharing of the benefits that arise from the exploitation of such resources. However, the CBD fell short in providing a clear framework around how genetic resources should be used and how benefits should be shared, hence providing no legal certainty for users and providers of genetic resources worldwide.

This is where the Nagoya Protocol comes in. It was negotiated and signed in Nagoya, Japan in 2010 and came into force in October 2014. It is in fact a supplementary agreement to the CBD. When we wrote this blog, there were 107 countries signed up to it – with some notable exclusions. The Nagoya Protocol creates a legal framework ensuring fair and equitable sharing of benefits that arise from utilising genetic resources in order to avoid instances of biopiracy, and promote further research on biodiversity.

Prior to the Nagoya Protocol, biopiracy was one of the issues which many developing countries with rich biodiversity would face. Although this term is not explicitly used in the Nagoya Protocol, it describes incidences of unethical or unlawful exploitation or appropriation of biological resources without providing any compensation to the country where the resources originate.

A common example used for biopiracy is the case of the neem tree (Azadirachta indica) native to India. Neem has provided many uses for the local communities in India. One such use being as a fungicide, which dates back to over 2,000 years. In the early 90s however, a US firm patented a fungicide that had neem origins. This was viewed by many as a clear example of biopiracy where biological resources are appropriated without providing any financial compensation to the native country where the resource originated. After a lengthy legal battle, the patent was eventually revoked almost 10 years later.

What does the Nagoya Protocol do?

By encouraging the fair and equitable sharing of benefits from using genetic resources and traditional knowledge, the Nagoya Protocol in essence creates a legal framework for achieving the third objective of the CBD. It establishes conditions for accessing genetic resource and creates an obligation for benefits to be shared when such genetic resources (or traditional knowledge) are exploited.

In the context of the Nagoya Protocol, genetic resources are considered to be non-human genetic resources such as plants, animals and microorganisms (or biological components of these). Traditional knowledge does not have a clear-cut definition (and its definition has been an ongoing topic of discussion) so in this blog we will describe it as knowledge, innovations or practises carried out by local communities that have been passed down for generations and have become part of a local traditional lifestyle. Traditional knowledge discussed in the Nagoya Protocol is specific knowledge relating to genetic resources. Interestingly enough, in the neem case which we mentioned above, the company which had patented the neem-based fungicide tried to argue that traditional knowledge should not be recognised to be “prior existing knowledge” (which would make an invention unpatentable) as it was not formally recorded, but passed down verbally through generations. This argument failed as the patent was revoked and also provided the rationale for setting up the Traditional Knowledge Digital Library of India where well established traditional knowledge is recorded.

The Nagoya Protocol requires that, in order to ensure fair and equitable sharing of benefits, users firstly obtain prior informed consent, and secondly establish mutually agreed terms with a provider country whenever they wish to make use of genetic resources/traditional knowledge originating from that country.

Prior informed consent (or often termed as “PIC”) is consent which has been given by the provider country before the research project is to be carried out upon reliance on sufficient information about the anticipated research project or use of the genetic resources/traditional knowledge. Mutually agreed terms (or “MATs”) are basically a contractual agreement that sets out what genetic resources/traditional knowledge are to be accessed as well as the sharing of the benefits that may arise from using these genetic resources/traditional knowledge. Benefits can be monetary or non-monetary, and regardless still need to be set out in the mutually agreed terms.

What does this mean for those who want to use genetic resources or traditional knowledge?

Researchers and research organisations in the UK and those EU member states which are signed up to the Nagoya Protocol (note, not all European countries are signed up), must follow the EU Regulation which sets out compliance measures for the Nagoya Protocol (or statutory instruments implementing the same at a country level) in order to use genetic resources/traditional knowledge. This means that all users of genetic resources/traditional knowledge in the UK and the relevant European countries must follow the regulation.

The regulation sets out that users of genetic resources/traditional knowledge must exercise due diligence to ensure that they have followed the access and benefits sharing (ABS) measures that the provider country has set in place (including for obtaining PIC and establishing MATs).

Not all countries which are signed up to the Nagoya Protocol assert rights over their native genetic resources. From example, the UK does not assert rights over its own genetic resources and so PIC is not a requirement. This means that if a researcher wanted to make use of a genetic resource originating from the UK, she will not need to obtain PIC as is set out under the Nagoya Protocol. Alternatively, countries which have richer biodiversity, such as Kenya, do. Therefore, a researcher looking to make use of genetic resources originating in Kenya, must obtain PIC, establish MATs, as well as execute appropriate material transfer or information transfer agreements. It is therefore important to remember that although a variety of countries have signed up to the Nagoya Protocol, each country will have its own access and benefit sharing (“ABS”) measures in place. This is why it is stressed that the users of genetic resource/traditional knowledge exercise due diligence in order to abide by these requirements (we will get to this a little later on).

A useful tool for assessing country requirements is the Access and Benefits Sharing Clearing House or the ABSCH which was established specifically for the Nagoya Protocol. The ABSCH is a database that contains all the ABS measures that each country signed up to the Nagoya Protocol has in place. The ABSCH includes the contact details of the National Focal Point who is the authority, at the provider country level, responsible for providing any information on how to obtain PIC and establishing MATs, as well as the forms, policies, rules and regulations pertaining to obtaining PIC or establishing MATs. It is key to note that the information that is available on the ABSCH varies from country to country and users may find that some countries will have more detailed information than others.

In the UK and the EU specifically, users are required, under law, to file Due Diligence Declarations to demonstrate that they have satisfied all requirements set by the provider country in obtaining PIC and MATs. These due diligence declarations need to be made at two points throughout any research project which makes use of genetic resources/traditional knowledge:

  • The first declaration should be made any time after funding for the research making use of the genetic resources/traditional knowledge is approved and before the research starts; and
  • the second declaration should be made at the final development stage of any product generated through the use of the genetic resources/traditional knowledge.

The declarations can be done using the DECLARE Nagoya IT System which is an EU wide database to which users upload their due diligence declarations. In the UK compliance with these requirements is regulated by the Office for Product Safety and Standards which is the UKs competent authority with regards to the Nagoya Protocol. Each party to the Nagoya Protocol has their own competent authority that is responsible for granting access and monitoring that access requirements have been followed.

Once PIC is obtained and MATs are established, provided that there are no other issues, a provider country will then issue out a permit to a specific user granting it access to the requested genetic resources or traditional knowledge. The information on these permits must be uploaded onto the ABSCH where they become Internationally Recognised Certificates of Compliance (“IRCCs”). These IRCCs act as evidence that the user had acted in accordance with the provider country’s ABS measures and obtained PIC and established MATs. Interestingly, and perhaps to the fear of certain users (we are thinking mostly commercial companies), the ABSCH also allows anyone with internet access to view any granted IRCCs which often contain quite a lot of detail about the genetic resources/traditional knowledge requested, the recipient, the agreed terms and even the anticipated research.

Lastly, one thing to keep in mind is that the requirement to comply with ABS laws and measures is not only applicable to when the recipient is based in a country other than the provider country. These laws must also be complied with even when use of the genetic resources/traditional knowledge is domestic unless the provider country does not assert its rights over its own genetic resources (like in the UK).

What about countries that are not Party to the Nagoya Protocol?

The US is one of the few countries that is not party to the CBD as well as the Nagoya Protocol. If users in the US are planning on carrying out research using genetic resources or traditional knowledge from a country party to the Nagoya Protocol they would still need to respect and follow the ABS measures and laws of the provider country. So essentially it may not be important that the US (or other countries like Ireland) is not party to the Protocol as so many other countries with rich biodiversity are.

So, what do the experts think?

There are certainly mixed reviews amongst experts over the Nagoya Protocol but generally everyone recognises the importance of having such a measure implemented.

The UK Chartered Institute of Patent Attorneys, for example, is very critical of the Nagoya Protocol. They feel that it is not in line with the CBD objective to encourage the fair and equitable sharing of benefits that arise from the utilisation of genetic resources and only helps to “put-off” users from carrying out research. In fact, they have recommended that following Brexit the UK should “relax the grip” that the Nagoya Protocol places on UK users of genetic resources/traditional knowledge.

In a recent UN Conference to discuss the progression of the Nagoya Protocol, there has been a discussion to include digital sequence information in its scope. Digital sequence information are digital genetic sequences that can usually be found on public databases (for example on NCBI). Including this into the scope of the Nagoya Protocol would mean that users would need to obtain permission before accessing the digital sequence information originating from a genetic resource native to a specific country.

Countries with rich biodiversity, like South Africa, have argued that the focus should be held on the fair and equitable sharing of the benefits of genetic resources whether physical or digital. However, others argue that the benefits that arise from utilising digital sequence information are virtually zero and so should not be included in the scope of the Nagoya Protocol as it will place more limits on scientific research. There may however be non-monetary benefits if digital sequence information leads to discoveries which are then published in a scientific paper for example.

There are also those that say the Nagoya does not do enough to protect holders of traditional knowledge. Traditional knowledge is often subject to commercial exploitation and some feel a traditional knowledge digital library (such as the one implemented by India) may be a better solution for protecting traditional knowledge. The Traditional Knowledge Digital Library in India holds traditional knowledge relating to medicinal methods and formulations in India.

In a recent UN conference on biodiversity, when discussing possible improvements to the Nagoya Protocol, a representative from Switzerland suggested for more legal certainty and the reduction of any unnecessary administrative burdens currently associated to the Nagoya Protocol. This is interesting as one of the objectives behind the Nagoya Protocol was to provide legal certainty but in the opinion of some it appears to be failing in that respect.

Summary of actions required under the Nagoya Protocol

If you plan on carrying out research using genetic resources/traditional knowledge from a country that is party to the Nagoya Protocol, then you would need to go onto the Access and Benefit Sharing Clearing House to determine what that provider country’s access and benefit sharing measures are. This will likely involve a requirement for obtaining prior informed consent as well as establishing mutually agreed terms. Remember, mutually agreed terms need to be established regardless of whether the benefits that are likely to be gained are monetary or non-monetary in nature. You must do this before you start your research, although in the case of research involving life and death (such as for research relating to a disease outbreak) – you have a three-month grace period to obtain prior informed consent and established mutually agreed terms after the research starts.

If you are based in Europe or the UK, then you would need to demonstrate that you exercised due diligence and met the provider country’s access and benefit sharing requirements. You would need to file Due Diligence Declarations at the relevant two stages of the research project, that is (i) any time after your funding is first approved and before your research starts, and (ii) at the development of the final product. These declarations should be filed using the DECLARE Nagoya IT System. Once this is done you will receive a permit from the provider country to access its genetic resources/traditional knowledge. We highly recommend that you consider requesting that your name is omitted from any subsequent Internationally Recognised Certificates of Compliance which is published on the Access and Benefit Sharing Clearing House, simply for the purposes of avoiding a breach of (and/or) maintaining confidentiality – especially where your research is part of a collaboration and/or has a commercial twist.

Lastly, it is worth noting that whilst certain countries have very clear and well-established measures and laws around access and benefit sharing – for example Kenya, some countries do not. Throw into the mix bureaucracy and under resourced governmental departments and obtaining permits from a provider country may become a very arduous and protracted process. Therefore, consider this fact if you are writing grant applications with specific start dates and make sure to get the process started ASAP! You can always get in touch with a broker, such as Ingentium which can help you along the way.

Final Thoughts

The Nagoya Protocol is still fairly new and improvements to it are continually discussed in the UN conferences on biodiversity. Is the Nagoya Protocol too strict on users? Should it include digital sequence information in its scope (I’m sure many of our clients are biting their fingernails at that notion)? How can holders of traditional knowledge be protected? These are all the questions which legislators and country representatives must think about when making changes to the Nagoya Protocol.
Please feel free to get in touch with us to share your thoughts and views on the Nagoya Protocol. Also, if you liked this blog or the accompanying vlog – you can subscribe to our quarterly newsletter to stay in the know with Ingentium.

Nagoya Protocol Resources and References

The Nagoya Protocol – full text

The Access and Benefit Clearing House

Access and Benefit Resource Forum

References
Governments embark on transformative agenda to achieve global biodiversity targets’ EnviroNews Nigeria (18 July 2018) accessed 29 August 2018

India wins landmark patent battle’ BBC News (9 March 2005) accessed 29 August 2018

Ahrén M and others ‘An Explanatory Guide to the Nagoya Protocol on Access and Benefit-sharing’(2013) IUCN Environmental Policy and Law Paper, 83 accessed 29 August 2018

CIPA Life Sciences Committee ‘Nagoya – should UK remain a member? If so, what needs to change?’ (The Chartered Institute of Patent Attorneys, 8 June 2017) accessed 29 August 2018

Commission Implementing Regulation (EU) 2015/1866 of 13 October 2015 laying down detailed rules for the implementation of Regulation (EU) No 511/2014 of the European Parliament and of the Council as regards the register of collections, monitoring user compliance and best practices [2015] OJ L 275/4

Commission notice — Guidance document on the scope of application and core obligations of Regulation (EU) No 511/2014 of the European Parliament and of the Council on the compliance measures for users from the Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilisation in the Union [2016] OJ C313/01

Digital sequence information on genetic resources (Convention on Biological Diversity) accessed 29 August 2018

Halewood M and others, ‘Potential implications of the use of digital sequence information on genetic resources for the three objectives of the Convention and for the Nagoya Protocol’ (2017) CGIAR accessed 29 August 2018

ICC Commission on Intellectual Property ‘Digital Sequence Information’ (International Chamber of Commerce, 30 May 2017) accessed 29 August 2018

ICC Task Force on Access and Benefit Sharing ‘Digital Sequence Information and the Nagoya Protocol’ (International Chamber of Commerce, 2 November2017) accessed 29 August 2018

Lyal C ‘Digital Sequence Information’ (ABS Information Forum, 2 February 2017) accessed 29 August 2018

Rabitz F, ‘Biopiracy after the Nagoya Protocol: Problem Structure, Regime Design and Implementation Challenges’ [2015] 9(2) Bras. Political Sci. Rev. accessed 29 August 2018

The Nagoya Protocol (Compliance) Regulations 2015, SI 2015/821

Twenty-Second Meeting of the Subsidiary Body on Scientific, Technical and Technological Advice and Second Meeting of the Subsidiary Body on Implementation of the Convention on Biological Diversity (Montreal, 2-13 July 2018) 9 (710) Earth Negotiation Bulletin accessed 29 August 2018

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Senior Associate, Ingentium