Moving the Needle: Making Canadian Farmers More Competitive The Role of Intellectual Property Protection
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1 CANADIAN SEED TRADE ASSOCIATION L ASSOCIATION CANADIENNE DU COMMERCE DES SEMENCES 39 Robertson Road Suite 505 Ottawa, Ontario K2H 8R2 Tel: Fax: csta@cdnseed.org Moving the Needle: Making Canadian Farmers More Competitive The Role of Intellectual Property Protection The Vision for the Future Canadian Seed Trade Association Policy November, 2013 The Objective In order to enable the seed industry to deliver productivity, competitiveness and market opportunities to farmers through new varieties, the developers of plant genetics are compensated for every acre planted to their materials. Meeting the Objective CSTA promotes the availability and use of all relevant tools to protect intellectual property in seeds, and that the implementation of these tools should protect holders to the highest degree. CSTA supports the following as elements of the Canadian IP tool box. (a) PLANT BREEDERS RIGHTS LEGISLATION CSTA strongly supports amendments to Canada s Plant Breeders Rights Act that will incorporate UPOV provisions in their entirety. Specifically: i. Breeder s Right Canada s legislation must incorporate the UPOV 1991 definition of the breeder s right in its entirety, ensuring that the following actions require the authorization of the breeder: Production or reproduction Conditioning for the purpose of propagation Offering for sale Selling or other marketing Exporting Importing Stocking for any of the above purposes ii. Legitimate Interest of the Breeder UPOV 1991 specifically refers to respecting the legitimate interests of the breeder, however it does not define the term. CSTA defines the legitimate interests of the breeder as: Recognition and respect of the breeder s right to receive compensation for the initial and subsequent use of the innovation that reflects the value that the innovation brings to the purchaser/user. iii. Farmers Exception to the Plant Breeders Right If there is to be a farmers exception in Canada s Plant Breeders Rights legislation, the language of the UPOV must be included in its entirety. CSTA will not support language in Canada s Plant Breeders Rights Act that goes beyond the provisions of the 1991 UPOV Convention. The UPOV Convention of 1991 clearly provides for returns to plant breeders.
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3 Additionally, if Canada is going to include a farmers exception in legislation, it must not extend to sectors of agricultural or horticultural production where such an exception does not already exist. iv. Products of Harvested Material UPOV 1991 provides that harvested material, including entire plants and parts of plants, obtained through the unauthorized use of propagating material of the protected variety shall require the authorization of the breeder, unless the breeder has had reasonable opportunity to exercise his right in relation to the said propagating material. CSTA supports the inclusion of this provision in Canada s Plant Breeders rights legislation to ensure that the costs of innovation are shared throughout the value chain. Reasonable Opportunity CSTA believes that history and case law makes it clear that the definition of reasonable opportunity does not include the obligation to protect the variety in other countries. v. Provisional Protection the provisions of the UPOV 1991 which safeguard the interests of the breeder during the period between the application for the grant of a breeder s right and the grant of that right must be incorporated into Canadian Plant Breeders Rights legislation. This protection must at least entitle the holder to remuneration from any person who has carried out acts which would require the breeder s authorization once the right is granted. vi Essential Derivation The 1991 UPOV introduces the concept of essential derivation and dependency from an initial variety. Amendments to Canada s Plant Breeders Rights Act to incorporate language around essentially derived varieties are important to provide a balance between access to and protection of initial originators of germplasm. vii Plant Breeders Rights Office CSTA supports the development of a Mission, and Vision statement for the Plant Breeders Rights Office (PBRO), which includes a commitment to encouraging innovation, investment and creativity in Canadian plant breeding, and to continuously strive to improve performance in keeping with the mission and vision. In light of this, CSTA requests that the Government of Canada consider the fit of the Plant Breeders Rights office with the Canadian Food Inspection Agency, given the mandate of the CFIA, which is to protect the health and safety of Canadians and the environment. (b) ENHANCING REGULATIONS AND THE ROLE OF REGULATORS IN SUPPORT OF CANADIAN INTELLECTUAL PROPERTY LAWS The Seeds Act and its associated regulations provides a framework that can support and complement intellectual property laws, however its requirements do not carry through to Federal and Provincial acts and regulations for crops. In some cases, there are direct conflicts. The Federal and Provincial Acts and Regulations that have the greatest impact on the protection of intellectual property are: i. Seeds Act and Regulations The Seeds Act governs the sale of most seed in Canada. The Act defines which specific varieties are eligible for sale in Canada; the requirements for physical quality defined by germination and seed lot purity; seed performance; and the qualification for and use of variety names. ii. Canada Grain Act and Regulations The Canada Grain Act establishes the rules of trade for the Canadian grain industry. These regulations include determining which production varieties are permitted into which class and grade of grain. iii. Crop Insurance Acts and Regulations Each provincial crop insurance scheme outlines acceptable production practices that are required to qualify for crop insurance coverage, including a listing of which specific varieties are approved for use in specific areas.
4 Each regulatory instrument described above is delivered by distinct government staff. To eliminate conflicts, ensure continuity and effectively support an efficient IP system, CSTA requests that, for crop kinds subject to certification, the following elements be common to all: Definition of variety name The Seeds Act and Regulations; Canada Grain Act and Regulations; and Crop Insurance Acts and Regulations should include a common definition of variety name. This definition should confirm that a variety name can be only being applied if the producer has proof of a purchase of pedigreed seed. The purchase of pedigreed seed would provide the only basis for an acceptable declaration of variety at the point of delivery into the grain system. Use of variety names Consistent use of variety names throughout the grain system will help to ensure grain quality and characteristics throughout the value chain. Appropriate penalties should be established for the misuse of variety names throughout the grain system. For example, penalties would apply if grain is shipped by variety name and that grain was not produced using legitimately acquired pedigreed seed of that variety. Protection of Variety Names Proof of purchase of pedigreed seed should be the only qualification for the use of a variety name throughout the seed and grain system. Regulations must make clear that any other instrument, including seed analysis certificates to determine variety are not sufficient to permit the sale of seed by variety name, or to allow entry of grain into a specific delivery class. In addition to ensuring that there is common language in Acts and Regulations, CSTA requests that, for crops subject to certification, specific actions provided by regulations and regulators be complementary: Grant of crop certificates The crop certificate is included in Canadian Regulations and Procedures for Pedigreed Seed Crop Production (CSGA Circular 6), to facilitate tracking and transfer of a specific seed lot for sale or further seed production. Sale and further seed production are acts subject to the authorization of IP rights holders. Crop certificates should not be issued without the authorization of the rights holder. This should be considered as part the provisions for sale and sell in Plant Breeders Rights Regulations. Access to Crop Insurance benefits of a variety only when a legitimate purchase is made Producers qualify for crop insurance by confirming the adoption of a set of recommended practices. Where these practices include the use of a recommended variety, proof of purchase of pedigreed seed of that varieties should be required. Staff Communication and Reporting Staff of regulatory agencies who, as part of their functions as inspectors or advisors, have regular contact with producers and industry partners are often regarded as experts on all of the requirements for a legitimate sale of seed. Regulatory staff should be directed to provide full and correct information on all requirements, including the relevant intellectual property protection measures. Regulatory and inspection staff should also be required to note and report any suspected violations of IP rights to the holder of the rights if they are noticed or suspected during the course of any other regulatory review or inspection.
5 (c) EXPANDED USE OF CONTRACTS CSTA supports the use of contracts to facilitate interaction with customers, as they can serve as an effective, enforceable tool for those customers who might choose to be non compliant. While contracts are already an effective tool, they can be made more effective if the seed industry works together to extract the maximum value and certainty that contract law offers as follows: i. CSTA Endorsed Single Use Agreement CSTA supports the development of a set of contractual terms and conditions, endorsed by the CSTA, that seed companies and public breeders and industry in general could voluntarily choose to use to protect their investments in seed research and variety development (not limited to traits but also include protection for genetics) in Canada. The elements of the single use agreement could be used on their own or as part of the contracts used by each company or plant breeding institution. The focus of the CSTA endorsed single use agreement will be remedies for breach of contract. Remedies could include, but not be limited to: financial consequences; loss of access to technology; payment of fees; and costs associated with enforcement. Remedies would need to: vary by crop kind accurately address the value of the intellectual property be easy to apply, well understood by farmer customers and the industry and may or may not link the value of the seed to the value of the crop produced ii. National Rules for Seed Purchases In the longer term, to supplement the CSTA endorsed single use agreement, CSTA supports the development of a set of rules for the interpretation of contracts for the seed trade that would be approved by the CSTA Board of Directors; ratified by CSTA s members; appended to CSTA s bylaws and trade rules; and incorporated by reference in contracts. While CSTA will assist in the development of an education campaign and help ensure there is a clear understanding by farmers up front about what they are signing, CSTA will not act as an arbitrator, mediator or disciplinary panel. The contract will be enforced in the Canadian courts in the normal course. (d) PLANT CELL PATENTS/PLANT VARIETY PATENT Definition The right granted by the government, to exclude others from the following acts committed with regard to the reproduction or multiplication material of the protected material. production or reproduction; conditioning for the purposes of reproduction or multiplication; offering for sale, sale or any other form of marketing, import or export; possession for any of the above purposes. use in plant breeding 1 Plant cell patents (also called plant variety and variety improvement patents) can be an important component of the Canadian IP tool box. The protection afforded by these types of patents can encourage investments in locally adapted germplasm and can help to move Canada further into a position of global agricultural leadership. In the absence of plant variety patents companies may be more likely to focus on trait development without the complementary effort of germplasm/variety improvement. In addition, plant cell/plant variety patents have the potential to clarify and formalize the sharing of genetic material between plant breeders and developers. CSTA supports the concept of Plant Cell/Plant Variety patents and understands that clarity and certainty will come with their continued use. 1 Adapted from glp Intellectual Property Office (
6 (e) ROLE FOR AIDERS AND ABETTORS Aiding and abetting is a term from criminal law that refers to those that knowingly assist in the commission of a crime. There has been some use of this term in the industry of this term to describe those who assist in the infringement of intellectual property rights associated with seed. CSTA supports activities and actions to ensure that third parties actively promote and discourage the improper use of intellectual property. Specifically CSTA supports i. Seed Quality Testing specific training and review of Intellectual Property rights in the accreditation and audit protocols for Laboratories and Seed Analysts. Introduction of a specific requirement to include sale limitation statements on all certificates and reports when results apply to varieties protected by Intellectual Property rights. Development of a Code of conduct for proper reporting of variety testing results. Establishment of penalties when testing results are used to facilitate illegal sales or use of varieties protected by Intellectual Property rights. i. Seed Processing Adoption of full UPOV 91 requirements, which would include processing protected varieties for the purpose of sale an infringement Addition of specific training and review of Intellectual Property rights in the accreditation and audit protocols for those plants processing pedigreed seed. Introduction of the specific requirement to include sale limitation statements on all invoices for service and reporting of results when results apply to varieties protected by Intellectual Property rights. Development of a Code of conduct for proper reporting of potential violations. Establishment of penalties when facilities are involved in illegal sales or use of varieties protected by Intellectual Property rights. Require authorized inspectors and auditors to report infringements and cases of aiding and abetting ii. Seed Enhancements (f) REMEDIES Adoption of full UPOV 91 requirements, which would include application of seed enhancements to a protected variety for the purpose of sale an infringement. Addition of specific training and review of Intellectual Property rights in the accreditation and audit protocols for those firms and individuals selling these products. Introduction of the specific requirement to include sale limitation statements on all invoices for application service and reporting of results when results apply to varieties protected by Intellectual Property rights. Development of a Code of conduct for proper reporting of potential violations. Establishment of penalties when sellers of seed enhancements are involved in illegal sales or use of varieties protected by Intellectual Property rights. Enforce regulations on how the seed is presented for sale after enhancement has been applied by a non authorized seed establishment. These firms have no approval to re seal lots that have been altered. For all IP protection tools, CSTA supports the development of remedies that are fair and open, but are sufficient deterrents to protect intellectual property by preventing violations.
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