Background

      Nepal, situated in the Central Himalaya, has diverse physiographic zones, climatic contrasts, and altitudinal variations. The country has only about 0.1 percent of the total land mass of the world while it harbors over 2 percent of flowering plants, 3 percent of pteridophytes, and 6 percent of bryophytes of the world's flora. In addition, about 5 percent (246 species) of the total flora are endemic, which accounts to about 30 percent for whole of the Himalayan regions. Similarly, Nepal possesses over 4.2 and 8.5 percent of the world's total mammals and birds respectively and over 400 species of agro-horticultural crops. Of them, about 50 species have been domesticated for commercial and household consumption. At present, about 8,400 accessions of cereals, grain legumes, oil seeds, vegetables, industrial crops and spices crops are stored in different centers (Nepal Biodiversity Action Plan 2002).

      Biodiversity is intrinsically associated with the way of life of peoples. It has cultural and socio-economic importance and is one of the major sources of food and income for a large section of the society. Nepal is also known as an agrarian economy. Around 78 percent of the people depend on agriculture and its contribution to gross domestic product is almost 40 percent. Most farmers in Nepal practice subsistence agriculture. These farmers have largely contributed to the evolution of a vast amount of rich traditional knowledge (TK) on the conservation and sustainable use of biodiversity as well as on the development of agricultural systems. They have been conserving, maintaining, improving and developing genetic varieties of plants and animals since time immemorial. It has been estimated that above 90 percent of the seeds in food crops are produced and managed by farmers. The country is, however, weak in technological capability, more so in the frontier areas of science, which could be applied for turning the TK and biodiversity wealth into economic strength and removal of rampant hunger and poverty.

TRIPS, Nepal, and Convention on Biological Diversity

      Convention on Biological Diversity (CBD), 1992 has been seen as the first decisive global instrument to ensure conservation and sustainable use of the world's biological resources. "Fair and equitable sharing of the benefits arising out of the utilisation of genetic resources, including by appropriate access to genetic resources and by appropriate transfer of relevant technologies, taking into account all rights over these resources and to technologies, and by appropriate funding" is one of the three overriding objectives of CBD.

      By ratifying CBD, Nepal has clearly recognised the importance of biodiversity for livelihood enhancement, environmental management and their possible use for socioeconomic development. In order to comply with CBD, the country has also taken some policy and legal measures. The policy and law on genetic resources and access and benefit sharing (ABS) are in the draft forms and the government is in the process of bringing them into force in the near future.

      With Nepal's membership to the World Trade Organisation (WTO), a rules-based multilateral trading system, the enforcement of such policy and law has become even more important. The WTO's Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) is likely to affect all dimensions of biodiversity and farmers' rights to livelihood – cultural, social, economic and political. Specifically, unlike CBD, TRIPS challenges the sovereign right the states have over their biodiversity and negates the rights of farmers in relation to seed, TK and benefit sharing.

      Article 27.3 (b) of TRIPS has strengthened the position of Northern commercial breeders and multinational seed companies by allowing them to obtain stronger patent and plant variety protections whereas farmers in biodiversity-rich countries like Nepal are slated to be more vulnerable, marginalised and disadvantaged. There is every chance that the immense biological and genetic resources and TK, treasured by farmers in Nepal, would be accessed easily by commercial plant breeders and multinational seed companies in the name of scientific advancement, research and development. This gives enough room for such breeders and companies to pirate the biological and genetic resources (bio-piracy) and misappropriate the associated TK. Also, with certain genetic modifications of such resources – which they call "inventions" – they can develop new varieties compelling the real owners and donors (farmers) of such resources to pay hefty royalties for using their new and improved varieties.

      In the given context, Nepal has to be cautious while developing patent and plant variety protection related policies and laws. At the same time, the country should also be clear about its position that it has to take during WTO/TRIPS negotiations as a member.

TRIPS Review and Nepal

      When TRIPS was brought within the ambit of the WTO in 1995, developing countries were concerned about extension of IPRs in agriculture. They were particularly worried about the provisions for patent and plant variety protections under Article 27.3 (b) (See box 1) because these two forms of IPRs (patent and plant variety protection) have the potential to negatively affect the biodiversity, agricultural patterns and farmers' rights to livelihood.


      It was, therefore, agreed that this Article would be reviewed four years after the Agreement comes into force, i.e., 1999. However, members could not reach consensus during review negotiations in 1999 and conflicting interests and diverse positions continued. Then, in 2001, at the fourth Ministerial of the WTO in Doha, members reached a consensus through the Doha Declaration that TRIPS provisions should not conflict with the principles of CBD. In the Declaration, the Council for TRIPS has been instructed, in pursuing its work programme including under the review of Article 27.3 (b), to examine, inter alia, the relationship between TRIPS and CBD, the protection of TK and folklore, among others (See box 2).


      Despite such instruction, there has not been any breakthrough as members are still divided over the issue of the reconciliation of TRIPS and CBD. The negotiations for the review of the Article are still inflicted with conflicting interests and diverse positions. Many developing countries, including Brazil, India and Pakistan, have submitted joint proposals to the WTO demanding for the amendment of the Article in a manner that does not negate the sustainable use of biodiversity and the interests of farmers in developing countries. In this context, Nepal, as a WTO member, should also develop a position that protects its national interest, including the interests of farmers, who have made tremendous contribution for the development of biodiversity, including agro-biodiversity.

Nepal's Position for TRIPS Review:

      Nepal's position during the negotiations for the review of Article 27.3 (b) should be based on the principles of CBD. Nepal should demand along with other developing countries that TRIPS provisions should not conflict with the principles of CBD. It should demand that countries like Nepal, which are enacting ABS laws under the obligation of CBD, should be provided with flexibility to protect farmers' rights to livelihood. It should also make a point that the IPR regime within TRIPS should respect such laws.

      It should then make a proposal that TRIPS should not affect countries' sovereign rights over their biological resources and associated TK. Nepal should also demand with all members to recognise, respect and reward farmers for their contribution to the conservation and development of biological resources and associated TK.

      In relation to livelihood concerns, Nepal should demand for the protection of following farmers' rights:

Right to Seed

      Most farmers in Nepal depend on informal seed supply system; they save, exchange, reuse and sell seeds with their neighbours and local people. Therefore, Nepal should demand that the IPR regime should not deny farmers from saving, exchanging, reusing and selling their seeds because these are their traditional rights. It is also obvious that the violation of these rights would severely affect their livelihood patterns. Furthermore, it also makes them vulnerable with increasing risk of their displacement from farming. In the case of plant variety protection, TRIPS should not provide any route to the Northern countries to pressurize countries like Nepal to adopt Union for the Protection of New Varieties of Plants (UPOV) Convention as the sui generis system (of its own kind of law).

Right to Traditional Knowledge

      Farmers in Nepal possess a vast amount of TK, which are critical for the conservation and development of biological resources as well as for the growth of the agricultural sector. There is a concern that TRIPS provides legal cover to the commercial breeders and companies to misappropriate such TK. Therefore, Nepal should demand that TRIPS should respect such knowledge of farmers. Besides, in the cases of the use of such TK for any purpose, prior informed consent (PIC) be obtained from the farmers before using their TK for commercial purposes. At the same time, in order to reduce any threat of misappropriation of TK, ‘disclosure of source of origin' of such TK should be made mandatory in both cases: patent and plant breeders' rights.

Right to Equity in Benefit Sharing

      Nepalese farmers have developed a vast portfolio of biological diversity within crops and other plant species, which form the raw materials for many agricultural activities. Modern plant breeding, in fact, is built on such diversity that has been traditionally maintained and developed by farmers. However, there is a threat that patents would be granted on such resources and TK without PIC of the possessors (farmers) and benefit sharing. Therefore, Nepal should demand for the recognition of fair and equitable ABS mechanism within TRIPS so that biodiversity-rich countries like Nepal could benefit from the use of their resources and associated TK. In this case also, it is important that ‘disclosure requirement' (indicating the source of origin of resources) be made mandatory for the patent applicant and breeders.