1. BioSafety Protocol Article 27 Scenarios of Liability Drew L. Kershen Earl Sneed Centennial Professor University of Oklahoma College of Law © 2006 Drew L. Kershen, all rights reserved

2. Article 27: Liability & Redress  “The Conference of the Parties serving as the meeting of the Parties to this Protocol shall, at its first meeting, adopt a process with respect to the appropriate elaboration of international rules and procedures in the field of liability and redress for damage resulting from transboundary movements of living modified organisms, analysing and taking due account of the ongoing processes in international law on these matters, and shall endeavour to complete this process within four years.”

3. Timeline of Negotiations  Cartagena Biosafety Protocol January 2000 finalized Dec. 29, 2003 effective  Workshop on Liability and Redress in Dec. 2002  Technical Group of Experts in Oct. 2004 – background report and information  Open-ended Ad-Hoc Working Group of Legal and Technical Experts on Liability and Redress in May 2005 and Feb. 2006 Note of Exec. Sec. as background document Working Group options related to components of damage, including a “no option”  MOP3/COP8 of BSP/CBD Curitiba March 2006 Art. 27 barely mentioned

4. Timeline of Negotiations  Convention on Biological Diversity Finalized in 1992 in Rio de Janeiro Dec. 1993 entry into force  Article 14, par. 2: “The COP shall examine, on the basis of studies to be carried out, the issue of liability and redress, including restoration and compensation, for damage to biological diversity, except where such liability is purely an internal matter.”  Separate, parallel, cross- fertilizing negotiations  Group of Legal and Technical Experts with periodic meetings since 1993 (last meeting Oct. 2005)  Limited progress with disagreements on Definition of damage Threshold of damage Appropriateness Scope in light of exclusion  Public Research and Regulation Initiative (PRRI) (May 2006) Keep focus on biodiversity and environmental damage in CBD Do not single out biotechnology

5. BSP Working Group Components of Damage  Component One: Damage to conservation and sustainable use of biological diversity or its components  Component Two: Damage to environment, including damage to conservation and sustainable use of biological diversity or it components, impairment of soil quality, impairment of water quality, impairment of air quality  Component Three: Damage to human health, including loss of life or personal injury, loss of income, public health measures, impairment of health

6. BSP Working Group Components of Damage  Component Four: Socio-economic damage, especially in relation to indigenous and local communities, including loss of income, loss of cultural, social and spiritual values, loss of food security, loss of competitiveness  Component Five: Traditional damage, including loss of life or personal injury, loss of or damage to property, economic loss  Component Six: Cost of restorative measures

7. Scenarios of Damage  Scenario One Claim for damages arising from unapproved transgenic crop mixing with commercial agricultural crops Component Five of Working Group  Property damage Every national legal system provides redress  Adulterated product Displacement of national regimes when no need Purely an internal matter Damage to biological diversity?  Administrative risk assessment and risk management  Regulatory issues -- StarLink

8. Scenarios of Damage  Scenario Two Claim for damages arising from an approved transgenic crop mixing with non- transgenic crops resulting in a loss of premium for a person or company who intended to sell a non- transgenic commodity or food product Component Five of Working Group  Economic loss Purely an internal matter  Labeling laws varied between countries  Coexistence issues  Transfer of Contract risk Damage to biological diversity?  Loss of premium  Nothing to do with biological diversity

9. Scenarios of Damage  Scenario Three Claim for damages arising from an approved transgenic crop mixing with organic crops resulting in a loss of the organic label for the specific organic crop or of organic certification for the organic farmer’s farm  Scenarios Two and Three raise very similar issues Component Five of Working Group  Economic loss Purely an internal matter  Organic laws/standards  Coexistence issues  Do not intentionally use; reasonable measures  No loss suffered by any organic producer  Contract risk and pure economic loss – demand for zero tolerance Damage to biological diversity?  Loss of premium

10. Scenarios of Damage  Scenario Four Claim of damages arising from the loss of market access  For example, where a buyer decides against buying a farmer’s crop even though there was no evidence of transgenic material or the evidence of transgenic material was below legally-set thresholds Component Five of Working Group  Economic loss – “pure economic loss” Component Four of Working Group  Socio-economic loss Art 26: Socio-Econ. Considerations  Decision to import  Research/Information  BSP rejected idea Permissible for Art. 27?

11. Scenarios of Damage  Scenario Five Claim for damages arising from a decision of a farmer to forgo planting a particular crop because of concern about proximity to transgenic crops or market perceptions about transgenic crops. Component Four of Working Group  Socio-economic loss  Scenarios Four and Five raise the identical issues See previous slide right column Change itself becomes legally-recognized damage Brazil, China, India  Pay for loss of competitiveness  Pay for loss of spiritual and cultural values  Art. 26 – deny import but seek socio-economic damages?

12. Scenarios of Damage  Scenario Six Option one: “Damage to conservation and sustainable use of biological diversity and its components” Option two: “Damage to environment, including damage to conservation and sustainable use of biological diversity or its components, impairment of soil quality, impairment of water quality, impairment of air quality”  Components One and Two of Working Group Option One focuses on variability of species and habitats before and after transgenic agriculture; biodiversity per se Option Two focuses on environmental damage to specific components thereby indirectly protecting species and habitats  EU Environmental Liability Directive chose option two Definitional difficulties Lacking concrete references Baseline data and difficulties of measurement Change alone, including beneficial change or insignificant harms EU protects much more narrowly than the Scenario Six proposals

13. Scenarios of Damage  Scenario Seven “Damage to human health, including loss of life or personal injury, loss of income, public health measures, impairment of health.”  Component Three of Working Group Scenario Seven differentiated from Component Five (traditional damage)  Time-scale: long-term not short-term  Speculative claims -- no present factual basis and no determinable probability of becoming factual StarLink; Mexican maize

14. Scenarios Six and Seven Unique Attributes  Administrative Liability versus Civil Liability Standing to bring claims Compensation funds Cuba, Denmark, Iran  Causation Presumptions Burden of Proof Industry-wide liability  Biotechnology inherently dangerous?? Experience related to previous international treaties such as hazardous waste, oil pollution, nuclear waste  Impact of Scenarios Six and Seven Excessive Unbearable Unprecedented Public Sector Research and Millennium Developmental Goals Public Perception, especially in developing nations  Impact of Components One, Two, Three, Four Rejection of agricultural biotechnololgy Liability as the key to rejection

15. Thank You  I look forward to answering questions related to Article 27: Liability and Redress