1. Intellectual Property and Climate Change Crop Genetic Resources, IP Rights and Climate Change: Some Economic Issues Enrico Bertacchini Department of Economics and Statistics, University of Torino enrico.bertacchini@unito.it Torino October 1 th, 2013

2. Intellectual Property and Climate Change Why are Crop Genetic Resource insightful for the debate on IP and Climate Change? Crop Evolution always coping with environmental changes (Red Queen Race) Lessons from compensatory liability regimes and reconstructed commons experiences to be applied into the IP and Climate Change debate.

3. Intellectual Property and Climate Change Agriculture and Climate Change From 6.7 to 9.2 billion people by2050 40-50% of theworlds land surface is cultivated or grazed Biofuels compete with food crops for land Agriculture accounts for 10-12% of total global GHG emissions The Green Revolution was accompanied by significantly increased emissions of CO2, N2O & CH4 Gains in food production are achieved through areal extension, increased yield, greater cropping intensity (increased emissions How do we move to low emission climate resilient agriculture?

4. Intellectual Property and Climate Change Economic perspective on reconstructed commons Response to privatization pressure and proliferation of exclusive rights The narrative of the Anticommons Tragedy Tragedy or transition? Are institutions for the transfer of knowledge and information resources emerging or failing in the new proprietary context? An evolutionary perspective: Reconstructed commons are just one possible institutional response, but their success depends on agents’ incentives in joining them

5. Intellectual Property and Climate Change Plant breeding is a very cumulative innovation process strongly relying on the access and exchange of crop genetic resources.

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8. INTERNATIONAL TREATY ON PLANT GENETIC RESOURCES FOR FOOD AND AGRICULTURE ITPGRFA

9. Intellectual Property and Climate Change ITPGRFA Designed to overcome the “privatization” pressure created by TRIPs and CBD for crop genetic resources. Signed in 2001 and come into force in 2004 Under the aegis of the FAO

10. Intellectual Property and Climate Change A perfect example of compensatory liability regime or reconstructed commons… Setting up a Multilateral System of Facilitated Access and Benefit Sharing

11. Intellectual Property and Climate Change Article 10.2 Contracting Parties agree to establish a multilateral system and to share, in a fair and equitable way, the benefits arising from the utilization of these resources. Article 11.2 The Multilateral System shall include all plant genetic resources for food and agriculture listed in Annex I. Article 11.5 The Multilateral System shall also include material held in the ex situ collections of the International Agricultural Research Centres of the Consultative Group on International Agricultural Research (CGIAR) Article 12.3(g) Plant genetic resources for food and agriculture accessed under the Multilateral System and conserved shall continue to be made available to the Multilateral System by the recipients of those plant genetic resources for food and agriculture, under the terms of this Treaty

12. Intellectual Property and Climate Change Article 13.2 (d) The Contracting Parties agree that the standard Material Transfer Agreement shall include a requirement that a recipient who commercializes a product that is a plant genetic resource for food and agriculture and that incorporates material accessed from the Multilateral System, shall pay an equitable share of the benefits arising from the commercialization of that product,

13. Intellectual Property and Climate Change …but is it working? Using some Ostrom’s Design Principles and economic insights for understanding the efficacy of the reconstructed commons

14. Intellectual Property and Climate Change Principle 1. The boundaries of commons must be clearly defined Many crop genetic resources of the multilateral system are also available outside of it. Based on a representative sample of 2,655 (7.2%) of ICRISAT Sorghum accessions, it is conservatively estimated that at least half of the sorghum varieties declared in-trust by ICRISAT are being distributed without an SMTA by the US Department of Agriculture. Hammond (2011)

15. Intellectual Property and Climate Change Principle 2. There must be proportional equivalence between benefits and costs Largest benefit is access to pooled germplasm and related information Adopting the new SMTA is unexpectedly increasing transaction and opportunity costs. –Burden of the pay-back obligation –The SMTA does not specify a time limit  obligation more restrictive than a patent??? Difficulties in eliciting private parties’ participation

16. Intellectual Property and Climate Change Principle 5. Sanctions are graduated ITPGRFA compliance rules do not include potentially serious sanctions, other than, indirectly, loss of country reputation.

17. Intellectual Property and Climate Change Genebanks unequal distribution and strategic behaviors by states

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19. Conclusions Probably, without the ITPGRFA the situation would be worse off in terms of technology and material transfer related to crop genetic resources. Yet, the implementation of the Multilateral System points out some key operational weaknesses. Could this be a lesson for Patent reconstructed commons in green technologies?

20. Intellectual Property and Climate Change References Bertacchini, E. (2009). Contractually constructed research commons: a critical economic appraisal. In COMMUNIA Conference 2009; Torino, Italy. Halewood, M. (2013). What kind of goods are plant genetic resources for food and agriculture? Towards the identification and development of a new global commons. International Journal of the Commons. Hammond, E. (2011). How US sorghum seed distributions undermine the FAO Plant Treatys Multilateral System. Overlap and use of the CGIAR and US sorghum genebank collections. Studie im Auftrag des African Center for Biosafty, Erklärung von Bern, Development Fund. López Noriega, I., Halewood, M., Galluzzi, G., Vernooy, R., Bertacchini, E., Gauchan, D., & Welch, E. (2013). How Policies Affect the Use of Plant Genetic Resources: The Experience of the CGIAR. Resources, 2(3), 231-269.

21. Intellectual Property and Climate Change Thank You This presentation is released under a Creative Commons Attribuzione 3.0 Italia License (http://creativecommons.org/licenses/by/3.0/it/) 15