There is a Conflict b e t w e e n Intellectual

Property Rights and the Rights of Farmers

in D e v e l o p i n g Countries

HOPE SHAND

Rural Advancement Foundation International

P.O. Box 655
Pittsboro NC 27312 USA

Introduction: Geopolitics of P l a n t G e n e t i c Resources

Agricultural crops were domesticated in the tropics and semi-tropics over 12,000
years ago. In these regions, located mainly in the Third World, one finds the greatest
abundance of genetic diversity. All major food crops, the staple crops grown and con-
sumed by the vast majority of the world's population, have their origins and primary
centres of diversity in the Third World (Fowler and Mooney, 1990). Today, this
genetic diversity is threatened by widespread adoption of genetically uniform crop
varieties and combined pressures of population growth, urbanization, and en-
vironmental degradation. The pace of genetic erosion is accelerating, even as world
recognition of the importance of plant genetic resources increases the demand for
germ plasm.
Loss of crop genetic diversity threatens the existence and stability of our global
food supply. Genetic diversity, found mainly in the Third World, is vital for the main-
tenance and improvement of modern crop varieties (Plucknett and Smith, 1986). In
order to maintain pest and disease resistance in our major food crops, for instance,
plant breeders constantly require fresh infusions of Third World genes. Similarly,
the high yielding, elite cultivars of modern agriculture depend on a steady stream
of new, exotic germ plasm.
Crop genetic diversity enables Third World farmers to adapt crops suited to their
own ecological needs and cultural traditions. Without this diversity, options for long-
term sustainability and agricultural self-reliance in the developing world are lost.
In the words of Richard Lyng, former U.S. Secretary of Agriculture under Ronald
Reagan, the United States is "at the mercy" of Third World countries in terms of
access to crop genes (Fowler et al., 1988). Consider, for example, that all 15 food crops
worth one billion dollars or more in the U.S. economy originate and depend on Third
World gene pools. Their combined worth to the U.S. exceeds $50 billion per annum
(Fowler et al., 1988).
Not only cultivated species found in the farmers' fields, but also wild botanical

J o u r n a l of Agricultural a n d E n v i r o n m e n t a l Ethics 1991 0893/4282/91 $3.00 + .00

132 Hope Shand

relatives are enormously valuable. Canadian researchers Christine and Robert Pres-
cott-Allen value the annual contribution of wild genetic resources to U.S. agricul-
ture alone at an estimated $340 million annually (Prescott-Allen and Prescott-Allen,
1986).
It is difficult to exaggerate the importance and estimated value of the South's bi-
ological treasure house. The potential value is not limited to crop genetic resources.
With the advent of commercial biotechnology, there is heightened interest in the
South's genes, microbes and plants as a source for exotic breeding material. As bi-
otechnology industry representative Winston Brill observes:

We are entering an age in which genetic wealth, especially in tropical

areas such as rainforests, until now a relatively inaccessible trust fund,
is becoming a currency with high immediate value (Myers, 1988: 93).

Historically, scientists from industrialized countries have ventured southward in

search of exotic plants for plant breeding. Seeds found in Third World centres of di-
versity have been freely collected by Northern scientists and later employed in plant
breeding, eventually resulting in the elite, high-yielding cultivars offered for com-
mercial sale. The seeds collected in Third World nations, have, in the process, been
transferred to Northern seed banks for "safe-keeping." Much of the collected diver-
sity of Third World origin thus came to be stored in the North. 1 But no money
changed hands in the process, nor was recognition given to the real proprietors-
generations of Third World peasant farmers who selected, maintained and improved
these traditional crop varieties-both past and present. And worst ofaU, in the midst
of widespread genetic erosion in Third World centres of diversity, high-tech seed
banks in the North proved woefully inadequate (due to both technical and financial
shortcomings) in conserving the seeds they appropriated for safe-keeping (Mooney,
1987). 2
The irony and asymmetry of this historical relationship between North and South
is described by sociologist Jack Kloppenburg (1990: 3):

The South has in effect been engaged in a massive program of foreign

aid to the North. Genetic and cultural information has been produced
and reproduced over the millenia by peasants and indigenous people.
Yet, like the unwaged labor of women, the fruits of this work are given
no value despite their recognized utility. On the other hand, when such
information is processed and transformed in the developed nations, the
realization of its value is enforced by legal and political mandate.

Over the past decade, the debate over control, ownership and conservation of
plant genetic diversity has assumed immense importance in the international policy
arena. The decade-old debate is now at a critical juncture. Many Third World na-
tions are calling for formal recognition of "farmers' r i g h t s " - t h e y ask to be compen-
sated for the contributions made by generations of peasant farmers, both past and
present, in conserving, improving and making freely available their plant genetic
 Justice between Economies 133

resources. Meanwhile, attempts by Third World nations to receive compensation for

their biological diversity are being thwarted by corporations seeking to patent this
genetic material. Industrialized nations are vigorously promoting the global exten-
sion and harmonization of intellectual property laws, with the ultimate goal of ex-
clusive control over biological products and processes.
The developing nations are asking, will the Third World's genetic diversity be-
come the patented products of transnational corporations? Will poor people of the
Third World benefit from their priceless biological resources? What compensation
will be made to the anonymous farmers who have tended and nurtured the world's
crop genetic diversity over the past 12,000 years? These decisions will be made in
the next few years. The outcome will have a profound effect on the future of the
world food supply and the sustainability of agriculture.

T h e 1980s: "Seed Wars" at t h e U n i t e d N a t i o n s

In the early 1980s, Third World ambassadors at the United Nations' Food and Ag-
riculture Organization (FAO) began to question long-standing inequities in the free
flow of germ plasm from South to North. Why, they asked, were patented seeds, ulti-
mately of Third World origin, bringing profits to multinational seed corporations
without corresponding compensation for the Third World? Why were the South's
genetic resources being poorly conserved in seed banks, and stored primarily in the
North or under the control of northern industrialized nations?
In response, Third World ambassadors proposed a series of reforms. In 1983, they
created the FAO Commission on Plant Genetic Resources as the official United Na-
tions forum where governments could come together to discuss the use, control and
conservation of the world's plant genetic resources. They also established a frame-
work for an international system of gene banks, funded and operated under FAO
guidelines. But most controversial of all was the Commission's "International Un-
dertaking," a non-binding agreement spelling out guidelines for the conservation
and exchange of plant genetic resources, with the underlying principle that these
resources should be considered the "common heritage of humankind" and "should
be available without restriction." In 1985, the Commission also established an "in-
ternational gene fund" to support plant genetic conservation and breeding programs
in the Third World.
Controversy erupted over the Undertaking's initial interpretation of unrestricted
access to plant genetic resources. It included not only traditional landraces and wild
crop varieties found in the Third World, but also the elite, advanced breeding lines
developed by seed corporations-often patented varieties. As a result, many in-
dustrialized nations refused to join the FAO Commission on Plant Genetic Re-
sources, to adhere to the Undertaking, or both. The United States, Canada, France,
the Federal Republic of Germany and Great Britain were among those who argued
that plant patenting laws, known as "plant breeders' rights," precluded participa-
tion in an agreement giving the Third World free and full access to proprietary seeds.
The plant breeders' rights system is a type of patent protection established espe-
cially for plant breeders. In the U.S., the parallel system is known as the Plant
134 Hope Shand

Variety Protection Act. The plant breeders' rights system was established in 1961
under the Union for Protection of New Varieties (UPOV). The UPOV Convention
lays down the rules for granting plant breeders' rights for new varieties in its mem-
ber states. To be eligible for protection, a variety must be novel, distinct and uni-
form. As an alternative to the rigid and more powerful industrial patent system, the
plant breeders' rights system provides breeders with limited monopoly rights over
the production, marketing and sale of their varieties, for 15 years. Traditionally, the
plant breeders' rights system, however, contains two important limitations. It ex-
pressly maintains the availability of genetic resources for crop improvement by al-
lowing breeders to freely use each other's protected varieties for further breeding
experiments. It also permits farmers to re-use seed from their harvests, without
having to pay royalties or ask permission.
Because of existing plant breeders' rights legislation, for many industrialized
countries the FAO International Undertaking was an assault on private property.
In other words, the concept of unrestricted availability of germ plasm and considera-
tion of plant genetic resources as "common human heritage" was perfectly accept-
able as long as it did not include proprietary seed varieties.
Ultimately, however, developing nations hold a potent bargaining chip in the de-
bate over access to plant genetic resources. The threat of a Third World nation's
shutting down its national borders and restricting future access to germ plasm con-
vinced all parties of the need to negotiate a mutually acceptable interpretation of
the International Undertaking.

T h e I n t e r n a t i o n a l G e n e F u n d as a M e a n s of I m p l e m e n t i n g
Farmers' Rights

In November, 1989, the 157-nation FAO conference endorsed a new interpretation

of its International Undertaking on Plant Genetic Resources that recognizes both
"plant breeders' rights" (plant patenting laws provided for under UPOV) and
"farmers' rights." The resolution states that plant breeders' rights are "not incom-
patible" with the International Undertaking and it accepts the expression of these
rights in the legal protection of patented varieties. Balancing this concession to
developed nations is parallel recognition for "farmers' rights." It recognizes that most
plant germ plasm comes from developing countries and that farmers in these coun-
tries have not been sufficiently rewarded.
After the FAO adopted the new interpretation recognizing both plant breeders'
rights and farmers' rights, opposition from the North softened considerably. In
June, 1990, the U.S. and Canadian governments announced that they would join the
FAO Commission, with the intention of later becoming parties to the International
Undertaking. Virtually all major industrialized nations have now joined the FAO
Commission.
The significance and importance of farmers' rights extends far beyond the reso-
lution adopted at the FAO. There is growing recognition that "the history of agri-
culture is written without reference to the main innovators in the long-term process
of technological change" (Rhoades, 1989: 4). Third World farmers selected and
 Justice between Economies i35

domesticated all major food crops on which humankind survives today (Rhoades,
1989: 4). There is increasing awareness of the genius and innovation of these so-
called "primitive" farmers.
But the contribution of farmers and indigenous people is not ancient h i s t o r y - i t
is present and ongoing. In effect, Third World farmers are plant breeders who are
presently engaged in the same basic activities as corporate breeders. They are select-
ing for, producing and maintaining crop genetic diversity, but they receive no re-
ward, or recognition. In the words of agricultural researcher, Cary Fowler:

9 Third World farmers have been found to employ taxonomic systems,

encourage introgression, use selection, make efforts to see that varieties
are adapted, multiply seeds, field test, record data and even name their
varieties. In short, they do what many northern plant breeders do, ex-
cept that they do not apply for p a t e n t s - the one step in the process which
requires skills (and money) which they do not have (Fowler, 1990: 10).

It is becoming increasingly clear that the contributions of Third World farmers

deserve more than a pat on the back. Since the industrialized countries subsidize
their plant breeders through the legal instrument of patents or licences (plant
breeders' rights), then Third World farmers deserve concrete recognition and com-
pensation as well. "Farmers' rights" recognize the role of farmers in the conserva-
tion and further development of genetic resources and their right to benefit from it.
But, at this point, it is little more than a concept on paper.
FAO's International Gene Fund (now voluntary and underfunded) is viewed as
a mechanism whereby Third World farmers, as a group, could be remunerated for
the genetic material they donate to the world community. It is important to stress
that payments from the Fund would not go to individual farmers or their communi-
ties, but would instead be used to finance plant genetic conservation programs, con-
struction of gene banks and training of plant breeders in the Third World. The major
issue still to be determined is how the gene fund should be financed.
There is growing international support for a mandatory Gene Fund, supported
by all who benefit from plant genetic resources. In February, 1990, the "Keystone
International Dialogue on Plant Genetic Resources," a prestigious group of 46 in-
dividuals from 26 countries (including participants from the seed industry, national
governments, non-governmental organizations, and scientific research institu-
t i o n s - both North and South) concluded that "a Fund for Plant Genetic Resources
should require mandatory contributions from all participating states" (Keystone
Center, 1990: 10). The group recommended that at least US$500 million per annum
should be made available for the Fund, and they expressed concern that money for
the Fund "draw new money, that is, not be taken from existing development as-
sistance budgets and not be subject to erratic or unreasonable fluctuations" (Key-
stone Center, 1990: 10).
Precise formulas for assessing "fees" from member nations for the International
Gene Fund are now under discussion. Proposed formulas include, for example,
assessment based on a percentage of each nation's gross domestic product, or on
136 Hope Shand

their scale of contributions to the United Nations. Whatever the formula, the prin-
ciple of unrestricted exchange of plant genetic resources depends on meaningful rec-
ognition of farmers' rights and a concrete funding mechanism designed to reward
Third World farmers for their historic and ongoing contributions of plant genetic
diversity.

Life Patenting
With the rise of commercial biotechnology, 3 industrialized nations are scrambling
to rewrite international patent laws to allow for monopoly-like ownership and con-
trol of biological products and processes-popularly known as "life patenting." The
issue has profound implications for Third World development, and could seriously
undermine negotiations now under way at the FAO and elsewhere regarding con-
servation and exchange of plant genetic resources.
Globally, transnational seed and agri-chemical corporations are the leading play-
ers in agricultural biotechnology research. According to industry analysts, " . . . by
the year 2000, between 10 and 20 multinational-owned seed companies will domi-
nate the most profitable segments of the global trade" (Kent, 1989: 53). With few ex-
ceptions, scientific and technical capacity in the biosciences is highly concentrated
in the advanced industrial nations. A recent study by the Organization for Economic
Co-operation and Development (OECD) concludes, "Developing countries are only
participating in the process marginally" (OECD, 1989: 80-81).
Since patenting of life forms falls outside the scope of traditional intellectual prop-
erty law, the biotechnology industry has worked aggressively to re-define what is
considered human "invention," and legally patentable. In the 1980s, the U.S. govern-
ment took giant steps to accommodate the corporate desire to patent life, and thus
established a clear precedent for life patenting in the industrialized world. In 1980,
the U.S. Supreme Court, in the landmark case of Diamond v. Chakrabarty, ruled
that genetically-engineered micro-organisms are patentable. In 1985, the U.S.
Patent Office ruled that plants (previously protected by the less rigid Plant Variety
Protection Act) could qualify under industrial patent laws. In 1987, the U.S. Patent
Office ruled that genetically engineered animals are also patentable.
As a result of these decisions, virtually all living organisms in the U.S. (with the
notable exception of human beings) became patentable subject matter, just like Tup-
perware, toasters, or other human inventions.
It is important to stress that recent decisions made in the United States relating
to the patenting of genes, micro-organisms, plants and animals represent a radical
departure from existing intellectual property law around the world. Most European
Community member states, for example, are signatories to the European Patent
Convention. This stipulates that plant and animal varieties, as well as processes that
are essentially biological, are not patentable. Similarly, most developing nations do
not allow the patenting of plants, animals or their genetic components. The patent
laws of many developing countries exclude not only plants and animals, but often
food products, pharmaceuticals and chemicals as well.
 Justice between Economies I37

Implications for the Developing World

Despite many arguments to the contrary, 4 there are clear winners and losers in the
grab for life patenting. It is no secret that the Third World is on the periphery of in-
ternational patent activity, and at a clear disadvantage in accepting patent proposals
outlined at GATT and elsewhere. Of the 3.5 million patents in existence during the
1970s, no more than 1% were held by nationals of developing countries (Patel, 1989:
986). Of the patents granted by Third World nations, some 84% were owned by for-
eiguers. Less than 5% of these are used in production processes in the South, mean-
ing that the product is simply imported and does not contribute to overall develop-
ment. Foreigners often register patents in developing countries as a means to
prevent others from copying or using their technology, thereby stifling innovation
and local competition for imported goods (Peng, 1990: 211). A recent report by the
Netherlands government concludes:

The function of IPP in biotechnology is to promote biotechnological

innovation. However, if developing countries are forced to establish
patent intellectual property protection for biotechnological inventions
or for plant varieties, the function of Intellectual Property Rights will
p r i m a r i l y be the p r o m o t i o n of biotechnological innovation in
industrialized countries (Study Committee, 1990: 31).

Proposals for strengthening patent protection over biotechnology products and

processes at GATT, World Intellectual Property Organization (WIPO) and else-
where represent a drastic overhaul of intellectual property rights. In effect, the vast
biological diversity of the Third W o r l d - w h e t h e r simply discovered in nature or
manipulated by genetic engineers-could be rendered the intellectual property of
private interests. The patenting of useful genes found in nature is particularly con-
troVersial. For Third World farmers and consumers it means having to pay royal-
ties on biotechnology products which are based on their own natural resources and
their own knowledge and experience.
At GATT, the United States argues that the absence of intellectual property pro-
tection is costing U.S. industry between $43 and $61 billion annually in lost revenues
due to "pirating"-referring to counterfeit goods and patent infringements (Weiss-
man, 1990: 8). But if the tables are turned and the value of plant genetic materials
and indigenous knowledge is factored in, it is the Northern industrialized nations
who appear guilty of pirating. The following are just two examples.
Over three-quarters of all plant-derived drugs were discovered because of their
prior use in indigenous medicine (Anonymous, 1990a: 513). The annual world
market for drugs derived from medicinal plants discovered by indigenous people is
US$43 billion. With advances in plant molecular biology and the availability of new
diagnostic tools for screening, there is heightened interest in the South's medicinal
plants as a source for developing new pharmaceutical products. The National Cancer
Institute, for example, recently launched a $2.8 million program to screen thousands
of exotic plants from tropical forests. In order to collect these materials, they em-
138 Hope Shand

ploy ethnobotanists who in turn tap the traditional knowledge of indigenous people
who know and use medicinal plants. Without access to the traditional knowledge
which rainforest people possess, it would be impossible to identify the useful plants.
Yet ethnobotanist Darrell Posey estimates that less than .0001% of profits from
drugs that originated from traditional medicine have ever gone to the indigenous
peoples who led researchers to them (Posey, 1990).
The African cowpea provides a second example. In 1977, a British plant breeder
visited the International Institute of Tropical Agriculture in Nigeria, where he was
given dried black-eyed peas developed by West African farmers. 5 Over a decade later,
a gene was isolated from the cowpea, called Cowpea Trypsin Inhibitor (CpTI), which
confers remarkable resistance to insect pests. The Agricultural Genetics Company
of Cambridge, the company that isolated and described the CpTI gene, later received
patents on its "invention." Because of its insecticidal properties, the CpTI gene is
now worth hundreds of millions of dollars and is being inserted into a wide variety
of crops ranging from maize, wheat, soybean and alfalfa (Anonymous, 1990b: 7). But
who is the "inventor," and who stands to profit? It was West African farmers who
first developed superior cowpea varieties, because of their resistance to beetles in
storage. But it is the "owners" of the gene who now determine whether or not they
will make it available, and at what cost. The original innovators receive neither rec-
ognition nor reward for their work.
Third World representatives are becoming increasingly vocal about the inherent
inequity of the South's genetic resources becoming subject to monopoly control by
private companies. In the words of a Malaysian delegate to the UN General As-
sembly:

There are various instances where transnational corporations have

exploited the rich genetic diversity of developing countries as a free
resource for research and development. The products of such research
are then patented and sold back to the developing countries at
excessively high prices. This must cease. We must formulate
mechanisms for effective cooperation with reciprocal benefits between
biotechnologically-rich developed countries and gene-rich developing
countries. 6

In response to the life patenting campaign, Third World representatives are coun-
tering with proposals for the "informal innovation system"-an expansion of the con-
cept of farmers' rights. The concept of informal innovation is being advanced to rec-
ognize and reward Third World innovation. While patent systems are generally
geared towards recognizing a Western model of innovation based on the efforts of
individuals, a more informal, communal system of innovation has existed for cen-
turies in Third World agriculture. Discussion is now under way at various United
Nations forums about ways to amend existing patent conventions to include
farmers' rights, or to create an alternative system of recognition and reward for in-
formal innovators. 7
 Justice between Economies t39

The Impact o f Intellectual Property Rights on Conservation and

Exchange o f Plant Genetic Resources

In their haste to promote exclusive mechanisms for rewarding innovators of new bi-
otechnologies, industrialized nations have put forth one-sided patent proposals at
WIPO, GATT and elsewhere that give little or no consideration to the impact of in-
tellectual property rights on the future conservation and exchange of plant genetic
resources. These proposals violate the principle of unrestricted access to genetic re-
sources, and ignore the concept of farmers' rights and the role of informal innova-
tors. In short, intellectual property rights, without parallel recognition and reward
for the South's germ plasm donors, will set up formidable barriers to access to the
world's gene pools.
It is important to stress that the introduction of new varieties, often wit~: :upe-
rior agronomic qualities, is both necessary and desirable for Third World nations.
The danger, however, is that traditional crop varieties will be replaced and driven
into extinction by new, genetically-uniform commercial varieties.The international
community increasingly recognizes that Third World farmers and their communi-
ties must play a key role in conservation of crop genetic diversity (Keystone Center,
1990: 17). Many argue that agricultural systems requiring and sustaining plant
genetic diversity are the only guarantee for its long-term conservation. Of course,
the reality is that most developing nations lack the financial and technical resources
to conserve biological diversity, and thus are unable to derive full benefit from new
and traditional breeding techniques. In this way, they are not able to exploit their
biological wealth and develop indigenous capacity to reduce hunger and poverty.

Conclusion

The conflict between farmers' rights and intellectual property rights involves much
more than acrimonious debate over industrial patent protection for new technolo-
gies; it is about future control of the world's food supply and the hopes of economic
development for many Third World nations. Patent proposals at GATT, WIPO, the
European Community and elsewhere promote the privatization of plant genetic re-
sources on a grand scale. They violate the principle of unrestricted access to genetic
resources, and ignore the concept of farmers' rights and the role of informal inno-
vators. Ultimately, life patenting proposals will simply widen the gap between North
and South, rich and poor.
Proposals to extend monopoly control over biological products and processes are
short-sighted, and will undermine efforts to conserve the world's genetic resources
and guarantee access to them. It is a soverign right of all nations to decide intellec-
tual property issues for themselves. The seed industry should be lobbying vigorously
to ensure that U.S. trade representatives at GATT withdraw trade-related intellec-
tual property proposals dealing with biological products and processes. They should
also be promoting U.S. government support for a mandatory international gene fund
to support plant breeding and conservation in the Third World. It is in their own in-
terest.
140 Hope Shand

Third World nations have every right to demand an end to the unrecompensed
appropriation of their biological resources, and to require that future collection of
genetic material be undertaken in accordance with well-defined rules and proce-
dures. Donors of germ plasm have every right to insist on legally-binding mecha-
nisms to protect and reward their informal innovators and to provide opportunities
for sustainable agriculture, self-reliance and economic development.

Acknowledgement
The author wishes to acknowledge the assistance of Dr. Helzi Noponen, Department
of City and Regional Planning, University of North Carolina, for her comments and
support.

Notes
1. According to a study prepared in 1986 by the Rural Advancement Fund International, over
90% of the germ plasm samples in storage came from the Third World. Only 15% of the du-
plicates of this material were stored in the Third World under the control of their govern-
ments. And only 25% of the regional and 16% of the global repositories for individual crops
were in the Third World (Fowler and Mooney, 1990).
2. The report by Mooney (1987), based on an evaluation prepared by the International Board
for Plant Genetic Resources (IBPGR), indicates that a majority of the world's collected
crop germ plasm is not securely stored, and some lost.
3. Biotechnology is a wide range of techniques which involve the use and manipulation of
living organisms to make commercial products. These techniques include: recombinant
DNA technology (genetic engineering), cell fusion, tissue and cell culture, embryo trans-
fer.
4. The general rationale for patents is that they encourage innovation. Some economists
argue that you cannot have economic development in the Third World without adequate
patent protection. See, for example, Rapp and Rozek (1990: 75-102). The authors argue
that modern economic growth requires intellectual property rights that prevent expropria-
tion or dissipation of the gains from innovation. Without such protection, economic
development in the Third World is thwarted.
5. Published in Mooney (1990: 26). The story originally appeared in the German magazine,
Der Spiegel (1989: 228-239).
6. This statement was made in November, 1990. Quoted in (GRAIN, 1991: 6).
7. In 1985, two United Nations agencies, UNESCO and WIPO, adopted the "UNESCO/WIPO
Model Provisions for National Laws for the Protection of Expressions of Folklore Against
Illicit Exploitation and Other Prejudicial Actions." The Model Law is particularly relevant
because it recognizes the rights of "communities" (rather than just individuals) to be le-
gally-registered innovators, and it specifies that communities have the right to retain ex-
clusive control over their innovations for as long as the community continues to innovate.
At its 25th General Conference in 1989, UNESCO adopted a recommendation that would
lead to the formalization of the Model Law into a legally-binding international convention.
Many Third World scientists and politicians believe that the Model Law may be interpreted
as protecting the biological products and process achievements of farmers, herbalists and
other members of the "informal innovation system." For more information, see Mooney
(1990).
 Justice between Economies 141

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