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Govt mandates compulsory licensing (CL) for GM seeds

By Narayanan Suresh

In an unusually pro-active policy, rare in the world, the Modi government has introduced a compulsory lincesing (CL) policy for all the genetically-modified(GM) seeds in India. In a notification issued on May 18,2016, the government has made it mandatory for GM technology companies like Monsanto and others to license its technology to any qualified seed company that seeks it within 30 days.

The royalty fee is fixed at 10% of the maximum retail price of Rs 800 per 450 gm packet of Bt cotton seeds for first 5 years. From the sixth year onwards, the royalty will decrease by 10 per cent every year.

This Modi government action is unprecedented in the world. Even in the case of pharmaceuticals where compulsory licensing is issued to companies that seek it from the innovator company, there is an elaborate procedure laid down. The CL seeker has to prove that the innovator has not acted on the patent granted in the country and only in public interest is the license issued to the applicant after careful consideration of the issues.

But in the case of GM seeds, the government has made it mandatory to issue the CL by the innovator company directly and if it is not done within 30 days, the application for CL will be automatically deemed to be issued. This is a very harsh step, and it remains to be seen whether it stands the test of legal scrutiny. Ironically, the government has said the guidelines are based on the principle of FRAND( Fair, Reasonable, and Non-discriminatory). The guidelines are termed Licensing and Formats for GM Technology Agreement Guidelines

This unusual government action in the case of GM seeds has come within a week of announcing a new Intellectual Property Rights(IPR) policy that seeks to uphold the rights of innovators in the country.

" This step is a huge blow to the innovators in agri-biotech industry,” said the BioAgri industry focus group ABLE-AG( Association of Biotechnology-Led Enterprises-Agri focus group). “It clearly indicates the intention of the government to disregard research and innovation and thereby not protect IPR in the sector," said ABLE-AG executive director, DrShivendra Bajaj.

Dr Bajaj added: “ This is a disincentive for bringing new technologies into India, which will ultimately harm the farmers as new technologies come slow to them.”

The near monopolistic control over Bt cotton technology enjoyed by Monsanto in the country has been a bug bear to the government that has under pressure from anti-GM civil society groups intervened strongly in the last year. The BioAgri industry has got only temporary relief from courts and the adverse conditions will continue till competition emerges in the form of home-grown GM technology alternatives. However, due to the ambivalence over the government’s support to GM technology, particularly in food crops, alternate GM technologies have found it difficult to mobilize huge resources needed to go through the expensive regulatory approval process.

( The author is Chief Operating Officer of ABLE)