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GM technology: Compulsory licensing rules withdrawn after outcry from crop research majors

The Indian Express has learnt that the decision to put on hold the latest notification came after intervention at the “highest level”

Written by Harish Damodaran | New Delhi | Updated: May 24, 2016 1:47:53 am
GM crops, india GM crops, genetic modification, genetically modified crops, GM cotton, monsanto, Bt cotton Minister of Agriculture Radha Mohan Singh (PTI Photo by Manvender Vashist)

The Centre has effectively rolled back a notification issued only last week, requiring genetic modification (GM) crop technology developers to license their proprietary traits on demand and not charge any royalty exceeding 10 per cent of the maximum sale price of seeds.

“We have decided to withdraw the notification and put it as a draft on our ministry’s website for inviting public feedback before finalisation”, the Union Agriculture Minister, Radha Mohan Singh told The Indian Express.

“This is not a roll-back. It’s just that the earlier notification is now being put in public domain to receive wider suggestions,” he added.

The notification, dated May 18, had said that the licensor of an approved GM technology – for instance, Monsanto’s Bollgard-II Bt cotton – “shall not refuse grant on a license” to any eligible seed company wanting to incorporate it into its own hybrids or varieties.

The notification, titled Licensing and Formats for GM Technology Agreement Guidelines, further mandated the technology developer to award the license for its trait “within 30 days of receipt of a request from [the] licensee”. In the event of not meeting the obligation, “the licensee is deemed to have obtained the licence … as per FRAND (fair, reasonable and non-discriminative) mechanism”.

The guidelines also had provisions for fixing of royalty (“trait fee”) payable by licensees. In the case of GM cotton, the trait fee for any newly commercialised trait – that could include Monsanto’s next-generation Bollgard-III Bt technololgy – was capped at 10 per cent of maximum sale price. The latter is already now being fixed by the Centre under a separate Cotton Seeds Price (Control) Order that was issued by the Agriculture Ministry on December 7.

Both the December 7 order and the May 18 notification have come under attack from the Association of Biotechnology Led Enterprises-Agriculture Focus Group, which represents crop research majors like Monsanto, Mahyco, Syngenta, DuPont Pioneer, Bayer BioScience, BASF and Advanta. The executive director of the lobby arm, Shivendra Bajaj, said that the latest guidelines were tantamount to unrestricted compulsory licensing, “as the innovator has no choice but to part with his technology, without even having a say on whom to give the license”.

Syngenta’s chief operating officer Davor Pisk told NDTV in an interview that the new licensing guidelines would hinder new farming technology coming into India ( Share prices of Monsanto India, on Monday, closed 8.6 per cent lower than its corresponding level for Friday.

The Indian Express has learnt that the decision to put on hold the latest notification came after intervention at the “highest level”. The timing and the wrong signals being sent to investors – more so, especially after the unveiling of a National Intellectual Property Rights policy barely 10 days back – apparently played a part in what is effectively a roll-back.

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