In 1992, a group of environmental enthusiasts across the globe came together at the Earth Summit to pave way for the conservation and preservation of biological diversity and the Convention on Biological Diversity 1992 (CBD) came into being. After signing the CBD on February 18, 1994, India promulgated The Biological Diversity Act 2002 (BDA) for conservation of biological diversity, sustainable use of its components and fair and equitable sharing of the benefits arising out of the use of biological resources, knowledge and for matters connected therewith or incidental thereto. The Biological Diversity (Amendment) Bill, 2021 (Bill No. 158 of 2021) has been introduced in Lok Sabha on December 16, 2021, to address practical issues faced by the stakeholders. This article aims to cover the journey of 20 years of the BDA and the proposed amendments in the Bill to understand how it seeks to balance two issues in parallel, i.e. trade in biodiversity in parallel with conservation and protection of biodiversity while keeping the interests of the local communities and benefit claimers.
ORIGIN OF BIODIVERSITY-RELATED INTERNATIONAL INSTRUMENTS
Stockholm Conference (United Nations Conference on Human Environment) in 1972 was the first major conference on international environmental issues to introduce uniform environmental protection. It specifically addressed the harmful effects of agricultural pesticides. The nations were held responsible for harmful environmental actions within their sovereign borders as well as actions that crossed over and harmed another State. The impact was monumental ultimately paving the establishment of the “United Nations Environment Programme” (UNEP) and agreements such as the Kyoto Protocol.
Brundtland Report (1987) also called Our Common Future introduced the concept of sustainable development and described how it could be achieved. The report was issued as the measures taken by the States were not enough to control and prevent environmental pollution and global warming. The report denoted the need for conservation of resources and maintenance of ecosystems and reconciling such need with the need for economic growth and development (sustainable growth). The report laid the foundations for the Rio Summit, held in Rio de Janeiro in 1992, which then led to the creation of the UN Commission on Sustainable Development that same year.
Re-affirming the Declaration of Stockholm Conference 1972, the United Nations Conference on Environment and Development (known as the Earth Summit) was convened in Rio de Janeiro, Brazil, from June 3-14, 1992. The notable aspects of Earth Summit are – Agenda 21 (a document that states priority actions and guidelines towards the achievement of sustainable development), the Rio Declaration on Environment and Development, Convention on Biological Diversity (CBD), and United Nations Framework Convention on Climate Change (UNFCCC). The Summit also laid down the groundwork for the UN Convention to Combat Desertification (UNCCD).
The primary objective of the Rio ‘Earth Summit’ was to produce a broad agenda and a new blueprint for international action on environment and development issues that would help guide international cooperation and development policy in the twenty-first century. The ‘Earth Summit’ concluded that the concept of sustainable development was an attainable goal for all the people of the world, regardless of whether they were at the local, national, regional or international level.1 The States would compulsorily enact effective environmental legislation(s). Environmental standards, management objectives and priorities should reflect the environmental and developmental context to which they apply. Standards applied by some countries may be inappropriate and of unwarranted economic and social cost to other countries, specifically the developing countries.2
Convention on Biological Diversity 1992 (CBD), known informally as the Biodiversity Convention, was opened for signature at the Earth Summit in Rio de Janeiro on 5th June 1992 and entered into force on 29th December 1993. The three main objectives of the CBD are conservation of biological diversity, the sustainable use of its components, and the fair and equitable sharing of benefits arising from genetic resources. Since biosafety was a prime concern under the CBD, the Cartagena Protocol on Biosafety was also adopted in 2000. The Protocol is considered to be a major step forward in the matter of Biosafety and the enabling of an environment for environmentally sound application of biotechnology while minimizing the possible risks to human health and the environment. India signed the convention in 2001 and ratified it in 2003.
Ten years after the Earth Summit, 1992, the States met in World Summit for Sustainable Development 2002 in Johannesburg, South Africa from 26th August to 4th September 2002 to access the progress made on sustainable development issues since Rio Earth Summit.
Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilization to the Convention on Biological Diversity (Nagoya Protocol) was adopted at the tenth meeting of the CoP to the CBD held in Nagoya in October 2010. This Protocol was adopted with the aim to further advance the implementation of the third objective and relevant articles of the CBD. The Protocol aims to deliver greater legal certainty and transparency for both providers and users of genetic resources. The Protocol encapsulates specific obligations to support compliance with domestic legislation or regulatory requirements of the Party providing genetic resources and contractual obligations reflected in mutually agreed terms (MAT). It also considers access to traditional knowledge held by indigenous and local communities when it is associated with genetic resources and the strengthening of the ability of these communities to benefit from the use of their knowledge. India ratified the Protocol in 2012.
BACKGROUND OF THE INDIAN ACT 2002
One of the very first codified laws in India for the protection of wildlife was the British enacted Wild Bird Protection Act of 1887 which prohibited the possession and sale of “wild birds” as defined by the Act.
Following discussions during and after the Stockholm Conference in 1972, India introduced Articles 48A and 51A(g) as part of Directive Principles of State Policy, which specifically address the need to protect and improve the environment.
In order to keep up with the spirit of CBD and Articles of CBD, India undertook several projects throughout the years. Ministry of Environment and Forests, Government of India, initiated a project on the preparation of a report on the implementation of Article 6 of CBD (1998), preparation of National Biodiversity Strategy and Action Plan and enactment of Biological Diversity Act, 2002.
Keeping up with India’s international obligations, Biological Diversity Act (BDA) was enacted in 2002 in order to achieve the obligations under the CBD.
BIOLOGICAL DIVERSITY ACT, 2002
The preamble of the BIOLOGICAL DIVERSITY ACT, 2002 (BDA or “the Act”) provides that the Act is enacted to provide for the conservation of biological diversity, sustainable use of its components and fair and equitable sharing of the benefits arising out of the use of biological resources, knowledge and for matters connected therewith or incidental thereto. India is rich in biological diversity and associated traditional and contemporary knowledge systems relating thereto. India is a party to the CBD and CBD reaffirms the sovereign rights of the States over their biological resources. It is considered necessary to provide for conservation, sustainable utilisation and equitable sharing of the benefits arising out of the utilisation of genetic resources and also to give effect to the CBD.
The Biological Diversity Rules 2004 and the Guidelines on Access to Biological Resources and Associated Knowledge and Benefits Sharing Regulations, 2014 under the BDA provides the framework for equitable benefit sharing to be put into effect by the authorities created under the law. However, the imposition of monetary compensation by the Authorities is being debated on issues of validity of the Guidelines. The regulations, rather than providing clarity, have created confusion among the parties affected.
OVERVIEW OF THE ACT
- Few key definitions under “the Act”:
- Benefit claimers [S.2(a)]: means the conservers of biological resources, their by-products, creators and holders of knowledge and information relating to the use of such biological resources, innovations and practices associated with such use and application.
- Biological diversity [S.2(b)]: means the variability among living organisms from all sources and the ecological complexes of which they are part and includes diversity within species or between species and of eco-systems.
- Biological resources [S.2(c)]: means plants, animals and micro-organisms or parts thereof, their genetic material and by-products (excluding value added products) with actual or potential use or value, but does not include human genetic material.
- Bio-survey and bio-utilisation [S.2(d)]: means survey or collection of species, subspecies, genes, components and extracts of biological resource for any purpose and includes characterisation, inventorisation and bioassay.
- Commercial utilisation [S.2(f)]: means end uses of biological resources for commercial utilisation such as drugs, industrial enzymes, food flavours, fragrance, cosmetics, emulsifiers, oleoresins, colours, extracts and genes used for improving crops and livestock through genetic intervention, but does not include conventional breeding or traditional practices in use in any agriculture, horticulture, poultry, dairy farming, animal husbandry or bee keeping.
- Research [S.2(m)]: means study or systematic investigation of any biological resource or technological application, that uses biological systems, living organisms or derivatives thereof to make or modify products or processes for any use.
- Sustainable use [S.2(o)]: means the use of components of biological diversity in such manner and at such rate that does not lead to the long-term decline of the biological diversity thereby maintaining its potential to meet the needs and aspirations of present and future generations.
- value added products [S.2(p)]: means products which may contain portions or extracts of plants and animals in unrecognizable and physically inseparable form.
- Compliances for different Legal entities under the Act:
The restrictions imposed and exemptions available under the BDA also varied based on the category of the applicant.
(i) Non-Indian entity:
- The Act defines Non-Indian entity u/S. 3(2) as :
- a person who is not a citizen of India;
- a citizen of India, who is a non-resident as defined in clause (30) of section 2 of the Income-tax Act, 1961 (43 of 1961);
- a body corporate, association or organisation—
(i) not incorporated or registered in India; or
(ii) incorporated or registered in India under any law for the time being in force which has any non-Indian participation in its share capital or management.
- Subject matter of approval: The Act provides approval process for Non-Indian entities in Section 19 for the following:
- to obtain any biological resource occurring in India or knowledge associated thereto for research or for commercial utilisation or for bio-survey and bio-utilisation.
- transfer the results of any research relating to biological resources occurring in, or obtained from, India.
- Authority: National Biodiversity Authority (NBA).
(ii) Indian entity:
- The Indian entities (not defined) require prior intimation to obtain any biological resource for commercial utilisation, or bio-survey and bio-utilisation for commercial utilisation. The Act excludes the local people and communities of the area, including growers and cultivators of biodiversity, and vaids and hakims, who have been practicing indigenous medicine from such intimation requirement.
- Authority: Concerned State Biodiversity Board (SBB).
(iii) Any Person whether it is Non-Indian or Indian entity :
- Subject matter of approval: The Act provides approval process for:
(i) applying for a patent or any other form of intellectual property protection whether in India or outside India,
(ii) for third party transfer of any biological resource or knowledge associated thereto for which the approval u/S. 19 has been sought,
(iii) to transfer the results of research to a Non-Indian entity.
- Exclusions provided under the BDA, where prior approval or prior intimation is not needed to access or obtain the bioresources:
(i) certain Government approved/sponsored collaborative research projects (S.5)
(ii) value added products (VAP): The bioresource which may contain portions or extracts of plants and animals in unrecognizable and physically inseparable form [S. 2(c) and 2(p)].
(iii) biological resources normally traded as commodities (NTAC) to the extent of such trading, e.g. turmeric, are exempted as notified by notification in the Official Gazette [S. 40].
- Regulatory Bodies under the BDA:
The BDA laid down a three-tier implementation structure:
- At national level: National Biodiversity Authority (NBA),
- At State Level: State Biodiversity Boards (SBBs), and
- At local level: Biodiversity Management Committees (BMCs).
Currently, there are 28 SBB and 5 UT Biodiversity Councils in Jammu & Kashmir, Ladakh, Chandigarh, Andaman & Nicobar Islands and Lakshadweep.
NBA has initiated the process for the preparation of an Electronic Dashboard for all the SBBs and UT Biodiversity Councils for maintaining the updated database on the BMCs established and Peoples Biodiversity Registers (PBRs) prepared all over the country.3
- ISSUES AND INSTANCES OF CONFLICT:
Famous biopiracy cases are on the patents granted for Indian plants and traditional knowledge: Curcuma, Neem, and Basmati Rice.
The Bt Brinjal Case4 was the first legal action against Monsanto and its Indian collaborators for biopiracy on a complaint to the Karnataka Biodiversity Board by Bengaluru-based non-profit Environment Support Group (ESG). It said that Mahyco (Maharashtra Hybrid Seeds Co.) along with its collaborators, University of Agricultural Sciences in Dharwad, Tamil Nadu Agricultural University in Coimbatore, Indian Institute of Vegetable Research in Lucknow and others had willfully violated the provisions of the Act. In its report to NBA dated May 28, 2011, KSBB had said that six local varieties for the development of Bt Brinjal have been accessed from Karnataka by Mahyco and their collaborators “without prior approval from state biodiversity board”. Mahyco claimed that this allegation would have been relevant only if there was a ‘‘commercial utilization’’ of Bt eggplant technology. This may not have been the case for the sublicense agreement, which prima facie aimed to transfer technology to UAS-Dharwad without commercial uses. The agreement provided that Mahyco, as a sublicensor, “had agreed to provide access to the technology without any payment for such access.” It granted to UAS-Dharwad “a royalty-fee, not-for-profit sublicense” so as to develop or distribute, other than by sale, licensed domestic eggplant products to resource-constrained farmers. Thus the sublicense agreement, it was contended did not provide for commercial utilization of Bt. eggplant technology”.
Many issues are faced by the users due to inadequate explanations of some key terms such as “by-products” and “value-added products” in the BDA, since “by-products” are included in the definition of “biological resources” whereas “value-added products” are excluded. Further, there is no mention of access and use of biowaste, which is a key aspect of green technology. Use of biowaste aids to the objective of sustainable use of bioresources. Therefore, coherent and detailed examples of these terms from the concerned authorities are needed to eliminate confusion in the interpretation of definitions. The Non-Indian entity defined u/S. 3(2) is not in accordance with other laws such as Income Tax Act and Companies Act, thereby creating a hurdle in foreign investment. The issue of notices by SBBs for levy of Access and Benefit Sharing (ABS) Fee according to Guidelines is considered by Indian industry as ultra vires to the Act. The 2014 Guidelines provides the regulatory framework for ABS Fee. The two main ambiguities in the Act’s regulatory mechanism are: (a) what is regulated, and (b) who are obligated to share benefits under the Act.5
The AYUSH companies filed a writ petition before the Nagpur Bench of the High Court of Bombay, inter alia, challenging the constitutionality of the 2014 Guidelines, seeking for a declaration that the 2014 Guidelines do not apply to Indian entities not trading in any biological resources with non-Indian entities and that they are ultra vires the BD Act and thus unconstitutional. In another series of cases before the Uttarakhand High Court, eight writ petitions were filed by paper manufacturing companies in response to the notices issued by the Uttarakhand SBB under the BD Act and the 2014 Guidelines. These writ petitions were disposed of at the admission stage itself with a direction from the Court that no coercive action shall be taken against the companies as long as they inform the SBB about the bio-resources obtained by them from within the territory of Uttarakhand.6
In Divya Pharmacy Vs UoI & Ors. Writ Petition (M/S) No. 3437 of 2016, the petitioner argued that Uttarakhand Biodiversity Board (UBB) cannot demand ABS Fee, under the Head of “Fair and Equitable Benefit Sharing” (FEBS), as the Board neither has the powers nor the jurisdiction to do that and, secondly, the petitioner, in any case, is not liable to pay any amount or make any kind of contribution under the head of “FEBS”. However, the Hon’ble Court opined that SBB has got powers to demand Fair and Equitable Benefit Sharing from the petitioner, in view of its statutory function given under Section 7 read with Section 23 of the Act and the NBA has got powers to frame necessary regulations in view of Section 21 of the Act. The challenge of the petitioner to the validity of the Regulations fails. This Hon’ble Court held that Regulations 2, 3 and 4 of the Guidelines on Access to Biological Resources and Associated Knowledge and Benefits Sharing Regulations, 2014 only clarifies and follows what is there in the Act and it is intra vires the Act.
Biological Diversity (Amendment Bill 2021)
As the instances of conflicts were growing regarding ambiguity in definitions, debated powers of authorities, the definition of Non-Indian entity, and criminal action on contravention of provisions of the Act, the Biological Diversity (Amendment) Bill 2021 was tabled in the Cabinet on 16th December 2021, to address the issues/gaps in the proposed amendments to the Act. The Bill’s purpose is to ease certain provisions of the Act for “foreign investment” and to “facilitate fast-tracking” of research and the patent application process. The Bill proposes to exempt AYUSH practitioners from the purview of the Act, remove the term Bio-utilization from the Act and bring the definition of Non-Indian entity in accordance with Income Tax Act 1961 and the Companies Act 2013.
The proposed amendments have been facing heat by some of the environmentalists as they find the proposed amendments as trade over conservation, a threat to bio-piracy and sidelining the role of BMCs.7 According to Legal Initiative for Forest and Environment (LIFE), the Biological Diversity Amendment Bill 2021 has also been introduced without seeking public comments required under the Pre-Legislative Consultative Policy.8 A parliamentary panel has invited views/suggestions from the public in general and NGOs/Experts/stakeholders and institutions in particular on 16th January 2022.
THE JOURNEY AHEAD
It appears a mammoth task for the relevant Authorities to ensure implementation of the Act in a way to balance the interests of both the Indian industry and benefit claimers and local communities while ensuring the meeting of the objectives of CBD of conservation of biological diversity, the sustainable use of its components, and the fair and equitable sharing of benefits arising from genetic resources.
- Annual Report 2020-21, MoEF and CC, GoI