Brazilian Agricultural Research Corporation

Embrapa Environment

Ministry of Agriculture, Livestock and Food Supply

Biotechnology and Biosafety

Integration and Opportunities in Mercosur

Katia Regina Evaristo de Jesus

Guilherme Ary Plonski

Technical Editors

Embrapa

Brasília, DF

2013

Embrapa Environment

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Editorial coordination: Selma Lúcia Lira Beltrão, Lucilene Maria de Andrade, Nilda Maria da Cunha Sette

Editorial supervision: Wyviane Carlos Lima Vidal

Editorial processing and proofreading: Corina Barra Soares

Bibliographic standards: Cecília MacDowell and Maria Amélia de Toledo Leme

Translation: Take Five Translations & Training – Rio de Janeiro, Donald Scott Alexander

E-book revision: Rafael de Sá Cavalcanti

Cover: Silvana Cristina Teixeira and Carlos Eduardo Felice Barbeiro

E-book conversion and editing: Alexandre Abrantes Cotta de Mello, Leandro Sousa Fazio

1st edition

E-book (2013)

All rights reserved.

For the exclusive use of KATIA REGINA EVARISTO DE JESUS. Unauthorized reproduction of this publication, in whole or in part, constitutes a violation of copyright (Law No. 9,160).

International Cataloging in Publication (CIP) Data

Embrapa Technological Information

Biotechnology and Biosafety: integration and opportunities in Mercosur / Katia Regina Evaristo de Jesus, Guilherme Ary Plonski, technical editors. – Brasília, DF, Brazil : Embrapa 2013.

E-book: il. color.

Epub format e-book, converted from the printed book.

ISBN 978-85-7035-318-4

1. Biotechnology. 2. Biosafety. 3. Genetic engineering. 4. Flowers 5. Legislation.6. Mercosur. 7. Patents. 8. Exotic Plants. 9. Ornamental plants. 10. Industrial policy. I. Jesus, Katia Regina Evaristo de. II. Plonski, Guilherme Ary. III. Embrapa Environment.

CDD 660.6

© 2013 Embrapa

Authors

Katia Regina Evaristo de Jesus

Biologist, PhD in Biotechnology, researcher at Embrapa Environment, Brazil, Highway SP 340, Km 127.5, PO Box 69, 13820-000 Jaguariúna, SP
katia.jesus@embrapa.br

Guilherme Ary Plonski

Chemical Engineer, PhD in Production Engineering, professor in the Department of Administration, Faculty of Economics, Administration and Accounting at the University of São Paulo (USP) and Managing Director of the Institute for Technological Research (IPT) [Instituto de Pesquisas Tecnológicas], Brazil
plonski@ipt.br

Juan Modesto Dellach

Pharmacist, Doctor of Pharmacy and Biochemistry, professor, School of Pharmacy and Biochemistry, University of Buenos Aires, Argentina
jdellacha@speedy.com.ar

Juan Carlos Carullo

Engineer, Master Professor in the area of Management Science and Technology of the Institute of Economic and Social Development (IDES) [Instituto de Desarrollo Económico y Social], of the REDES Center [Centro de Estudios sobre Ciencia, Desarrollo y Educación Superior] and the National University of General Sarmiento (UNGS) [Universidad Nacional de General Sarmiento], Argentina
jcarullo@ricyt.edu.ar

Acknowledgments

Contributions from the rapporteurs: Prof. Dr. Tânia Maria Araújo Domingues Zucchi – National Technical Commission on Biosafety (CTNBio) [Comissão Técnica Nacional de Biossegurança] –, Institute of Biomedical Sciences, University of São Paulo (ICB-USP) [Instituto de Ciências Biomédicas da Universidade de São Paulo], Brazil) and Prof. Dr. Carlos Alberto Moreira Filho (Einstein, USP).

Mrs. Maria Amélia de Toledo Leme (Embrapa Environment), for performing a review of the literature and providing support, and Mrs. Corina Barra Soares, for proofreading.

Embrapa Environment, for their collaboration.

The Institute for Technological Research (IPT) [Instituto de Pesquisas Tecnológicas], for their encouragement.

The National Council for Scientific and Technological Development (CNPq) [Conselho Nacional de Desenvolvimento Científico e Tecnológico], an organization dedicated to the Brazilian government’s scientific and technological development, for supporting the preparation of this work.

Presentation

This work is the result of joint efforts by researchers from Argentina and Brazil to offer the scientific and business community an updated compilation of the main laws and regulations governing research, development and marketing of biotechnology in the countries of Mercosur (the Common Market of the South [Spanish: Mercosur; Portuguese: Mercosul]).

This research was made possible through support provided by the National Council for Scientific and Technological Development (CNPq) [Conselho Nacional de Desenvolvimento Científico e Tecnológico], a Brazilian public institution dedicated to scientific and technological development, and the Argentine-Brazilian Center for Biotechnology (CABBIO) [Centro Argentino-Brasileño de Biotecnología]. These institutions have played an important role in training human resources and promoting strategic studies in biotechnology in the Southern Cone.

The binational team responsible for this work was composed of researchers with expertise in matters relating to scientific and technological development in the area of life sciences. In addition to their interest in strategic studies, they brought a wealth of personal experience in biotechnology research.

At this juncture, it is essential for the Mercosur countries to incorporate modern biotechnology in vital sectors of their economic affairs, such as health, agriculture and the environment, in order achieve not only economic growth but also – and most importantly – sustainable growth. Therefore, this book also represents a timely contribution to the development of biotechnology in the current setting.

Carlos Alberto Moreira-Filho
Coordinator of the Biotechnology Center, of the Institute of Biomedical Sciences, University of São Paulo (ICB-USP)
[Centro de Biotecnologia do Instituto de Ciências Biomédicas da Universidade de São Paulo]

Introduction

Biotechnology makes it possible to integrate various sectors which use innovative techniques to promote revolutions in diverse areas of knowledge. The Mercosur countries offer – among other potential conditions – a promising scenario for regional biotechnology development.

The recognition of biotechnology as a new paradigm in the technology field involves nurturing new policies specifically addressing this area. The transfer of results of publicly-funded research to the private sector harms the institutionalization of legal protection systems for biotechnological inventions and the products that result from them. Scientific knowledge is itself an economic product, which over time has come to require large investments in human capital and equipment.

Science and technology and their practical developments, meanwhile, are not insensitive to the social and economic impacts they cause. This awareness imposes a great responsibility on the scientific community with respect to aspects of biosafety and bioethics, as well as issues pertaining to quality control of biotechnology products.

It has therefore become imperative to develop technical and legal standards to define and establish clear lines of responsibility for actions that could threaten or endanger people’s health, the environment, the heritage of original germplasm, and productive development itself.

Discussions on the impact and potential risks of biotechnology have reached the conclusion that there is a need to establish a legal system based on solid scientific principles, capable of establishing standards for all issues relating to biosafety. The issues which should be covered by these standards include: operating conditions of biotechnology laboratories, control systems and prevention systems, requirements for release in the field and commercial distribution of products. They should include accurate assessments of environmental impact, and definition and allocation of responsibilities for monitoring and control functions, which take into account that biodiversity is a constant concern for society.

The impacts caused by technological and environmental development, expansion of agricultural frontiers, unrestricted use of pesticides, devastation of forests, allegations of biopiracy and potential risks of genetic modification, are some of the issues of the debate which have influenced the key processes in the search for provisions and mechanisms to prevent ecological imbalance.

This work provides information on the subject in the context of the Mercosur countries. Its various chapters contain a critical mass of essential information on biosafety and intellectual property in the field of biotechnology. The authors have incorporated contributions of particular relevance in light of the current dynamics of regional integration. This report is undoubtedly of strategic value to the audience interested in the development of this discipline.

Eduardo H. Charreau
President of Argentina’s National Council for Scientific and Technical Research (CONICET)
[Consejo Nacional de Investigaciones Científicas y Técnicas]

Part 1
Biotechnology in the Mercosur countries

Chapter 1
Biotechnology in Brazil

Introduction

The term “biotechnology” has gained currency since the mid-1970s, due mainly to advances achieved in the areas of cell and molecular biology, which led to genetic engineering (NOSSAL, 1987). With the discovery of restriction endonucleases, it became possible to manipulate the genetic material of eukaryotes. Soon afterwards emerged DNA cloning vectors, gene probes (to detect specific gene sequences) and strategies to control the transcription and expression of genes from higher organisms inserted into bacteria and yeasts. Parallel to these developments, new bioprocessing methods were developed, which made it possible to isolate and purify the products produced by microorganisms modified by genetic engineering.

The breadth of application of biotechnology has resulted in many definitions of this technology, depending on what it is used for (CERANTOLA, 1991). Foremost among these is the following definition given by the Organization for Economic Cooperation and Development (OECD): “Biotechnology is the application of scientific and engineering principles to the processing of materials by biological agents to provide goods and services” (BULL et al., 1982).

Other definitions, narrower in scope, have been added to that one, this time focusing on genetic engineering and recombinant DNA (rDNA), according to which “industrial applications are obtained with new or exogenous genetic material being incorporated and expressed in cells, bacteria or cultured cells and tissues” (ZIMMERMAN, 1984).

In general, biotechnology, which consists in obtaining industrial products and processes arising from direct or indirect actions of living organisms or parts thereof, has until recently been characterized as a field of scientific and technological knowledge specifically within the competence of professionals in the fields of microbiology, biochemistry, genetics, chemical engineering and biochemistry.

Cerantola (1991) classified these techniques through the lens of complexity and technological sophistication, as explained below:

Traditional biotechnology: science that involves basic fermentation techniques, classical plant breeding techniques and biological nitrogen fixation (in soybeans).

Intermediate biotechnology: science that uses techniques of plant tissue cultures, discontinuous fermentation, embryo transfer, production of microorganisms for biological control of pests, and biological nitrogen fixation in other crops and species.

Modern biotechnology: science that encompasses the techniques of rDNA and genetic engineering of microorganisms, plants and animals (SALLES FILHO; SILVEIRA, 1990).

The prominence which biotechnology has attained is also due to the use of different technological approaches focusing on rDNA technology and genetic engineering, cell fusion techniques and new types of bioprocessing. Such technological advances, widely discussed in documents of the US Congress (UNITED STATES, 1984), reflect the high capacity to modify and control biological systems at the cellular, subcellular and molecular levels.

Briefly, the main techniques used in modern biotechnology (CERANTOLA, 1991) could be described as follows:

Techniques of genetic engineering and rDNA: to sequence, decode, monitor, isolate and recombine genes or macromolecular parts of the genome.

Cell fusion: merging or fusing cells with different desirable traits, combining them into a hybrid cell (hybridomas for the production of monoclonal antibodies).

Bioprocessing methods: used for adapting to industrial production scale, fermentation, cell culture, purification or recovery of metabolites, tissue culture, micropropagation, sensor and bioreactor engineering.

The emphasis given to biotechnology is due not only to the current possibilities for manipulation of biotechnological processes (rDNA, modern bioprocessing methods, advanced techniques in cell biology), but also to the wide range of technology-based businesses emerging from applications of modern biotechnology. In Brazil, important sectors of the economy are biotechnology users (MOREIRA-FILHO et al., 1996), but the institutional environment and economic scenario have sometimes hampered the development of modern biotechnology in Brazil.

New technological applications require a certain amount of time for both consumers and industry – and especially legislation – to adapt, during which time the following variables come into play: the cultural and economic environment, factors determining the acceptability of certain products, and also adjustment of legal mechanisms relating to patents, trade agreements, licensing, etc.

The possibility of growth of biotechnology in Brazil is closely tied to leading international companies, which invest huge sums in new product research and development (R&D). Most of this research is carried out in countries of origin, due to various factors, including: the high degree of maturation of cooperative relations with universities, easy access to equipment and reagents, skilled labor and especially the existence of specific property rights laws.

Although the current global economic crisis has seriously impacted governmental science and technology (S&T) and private-enterprise research and development (R&D) programs, especially in developing countries, the recent adaptation of Brazilian law to intellectual property rights and biosafety standards is helping to keep the country on the path of R&D investment.

According to Castro (1999), a biotechnology industry as big as the one that developed in the United States did not occur in Brazil, for the following reasons:

The initial lack of specialists in the public and private sectors, an issue that currently has been partially resolved by the public sector. The priority investments in biotechnology by Brazil’s federal public sector over the past 20 years have not been matched the country’s States and private sector.

Two decades of inflation made it impossible to supply venture capital for long-term investments. Although inflation has subsided in recent years, the supply of venture capital is still a significant problem of relevance, partly due to the reason mentioned below.

The high costs of long-term investments, such as those related to biotechnology, is still an unsolved problem.

The lack of appropriate legislation, which was only formulated in the 1990s, such as laws dealing with patents, biosafety, protection of plant varieties, tax incentives, and other issues.

The lack of a clearly defined strategic model for the development of biotechnology, taking into account both the peculiarities and opportunities in Brazil, as regards the experience of other countries.

Brazil has 1,718 research groups working in biotechnology, registered in the Directory of Brazil’s National Council for Scientific and Technological Development (CNPq) [Conselho Nacional de Desenvolvimento Científico e Tecnológico], representing 7,713 research associates (Table 1).

With reference to research groups, the available data is more precise. There are 24,170 groups concentrated in the universities of São Paulo and Campinas, in the Federal Universities of Rio de Janeiro, Minas Gerais, Rio Grande do Sul, São Paulo, and finally, at the various Units of the Brazilian Agricultural Research Corporation (Embrapa) [Empresa Brasileira de Pesquisa Agropecuária], which altogether represent 50% of the research groups in the country

The government supports the training of human resources in companies and R&D centers through the Human Resources Training Program for Strategic Activities (RHAE) [Programa de Capacitação de Recursos Humanos para Atividades Estratégicas], of the Ministry of Science, Technology and Innovation (MCT) [Ministério da Ciência, Tecnologia e Inovação], which finances training activities through the entire course of execution of technological development projects. This program has been successful in the field of biotechnology and has facilitated the organizing of innovation networks. In 1996, 16 biotechnology projects were approved, and 26 in 1997. A similar program in the State of São Paulo is planned to complement the financing of technology projects.

The adaptation of Brazilian law to international legal requirements was provided by the following instruments: accession to the GATT; the Biosafety Act of 1995; the Patents Act of 1996; the Plant Variety Protection Act of 1997; the Seeds and Seedlings Law [No. 10,711 of 2003]; and the Public Information Access Law [No. 12,527 of 2011]. Accession to the International Union for the Protection of New Varieties of Plants (UPOV) allowed the entry of Brazilian agriculture into the world economy and agriculture.

Table 1. Groups, lines of research and researchers by sectors of activities in the biotechnology sector, by state.

State

Groups

Lines of research

Researchers

Acre

3

5

9

Alagoas

7

17

25

Amazonas

26

49

107

Bahia

47

113

202

Ceará

28

68

1,001

Distrito Federal

51

126

227

Espírito Santo

3

3

15

Goiás

25

53

131

Maranhão

13

17

30

Mato Grosso

3

4

14

Mato Grosso do Sul

20

30

104

Minas Gerais

208

493

863

Paraíba

23

39

104

Paraná

118

248

472

Pará

22

47

87

Pernambuco

92

182

404

Piauí

8

14

33

Rio Grande do Norte

11

15

33

Rio Grande do Sul

148

350

570

Rio de Janeiro

292

668

1,038

Rondônia

4

8

12

Santa Catarina

61

137

214

Sergipe

13

35

39

São Paulo

488

1,115

1,961

Tocantins

4

8

18

Brazil

1,718

3,844

7,713

Source: National Council for Scientific and Technological Development (CNPq) [Conselho Nacional de Desenvolvimento Científico e Tecnológico] / Diretório dos Grupos de Pesquisa no Brasil – Version 4.1.

The São Paulo Research Foundation (FAPESP) [Fundação de Amparo à Pesquisa do Estado de São Paulo] has a positive influence on genome research and the formulation of a scientific research model for developing countries. Having no laboratories and researchers of its own, and only a modest administrative staff, who work in a nondescript building located in a residential area of the city, the Foundation owes its achievements to prudent management and judicious choices.

In July 2000, a Brazilian consortium organized and funded by the Foundation became the first institute to sequence the genome of the plant pathogen Xylella fastidiosa, an insect-borne bacterium which infects orange trees. A few months later, FAPESP announced that the consortium had completed sequencing the genome of another pest, Xanthomonas citri, popularly known as citrus canker, which, by attacking citrus, consequently causes serious damage to the country’s thriving fruit export industry. Called the FAPESP Genome Project, it has allocated a budget of approximately US$ 12 million. Its initial focus has been on Xylella fastidiosa, the bacterium that causes citrus variegated chlorosis disease (CVC) [praga-do-amarelinho], which is threatening the citrus industry in the State of São Paulo, and which has also spread to coffee and plum crops.

Through the network, the sequencing of Agrobacterium tumefaciens [updated scientific name: Rhizobium radiobacter] has also been completed, which attacks grapevines, tomatoes, peaches, and other fruit plants. When transferring its gene into the genome of the plant, the bacterium induces uncontrolled growth of plant cells, causing a disease called crown gall [galha-da-coroa]. It is believed that this study will facilitate research on transgenic plants.

Also underway is the study of the genome of Anopheles gambiae (vector of malaria), and also eucalyptus and sugar cane. A recent partnership with the United States Department of Agriculture (USDA) resulted in Brazil being initiated into the genomic era with the creation of FAPESP’s Agronomical and Environmental Genome (AEG) Program, from the sequencing of Xylella which causes Pierce’s disease of grapevine, of Leifsonia which causes sugarcane ratoon stunting disease and Xanthomonas axonopodis which causes citrus canker. This partnership is dedicated primarily to comparative genomics, as well as functional genome analysis.

This type of networked study is tending to gain strength in Brazil, resulting in an increase in publications and partnerships with foreign organizations, thanks to the optimizing of research investment made possible by the fact that the actors in the network collaborate virtually, thus eliminating the installation of infrastructure (buildings and new laboratories), since each researcher works in their own laboratory. Following this model, FAPESP’s Viral Genetic Diversity Network (VGDN) and Structural Molecular Biology Network (SMolBNet) have also been created.

The biotechnology industry and its products

Significant sectors of the Brazilian economy are big users of classical biotechnology. In turn, Brazil’s research institutions have shown a reasonable level of competence in generating knowledge in various areas of biological sciences. In agribusiness, pioneering developments have occurred in the genetic improvement of coffee and corn, and recently in the soy, eucalyptus and poultry broiler segments, in which the country has an outstanding international position, with great competitive advantages to be leveraged (MOREIRA FILHO, 1996).

Thus, there is no doubt that the rapid progress of biotechnology will have a strong impact on important sectors of the national economy. The country must therefore be prepared to absorb as well as to generate innovations. Otherwise, we will not only lack the technology base for future growth, but will also run the risk of losing positions already achieved (such as in the agricultural sector and production of vaccines). If we neglect this issue, we will be doomed, in the coming decades, to the status of mere consumers of knowledge and technology generated by others. It is generally accepted that the ability to produce new knowledge is now a major factor in the distribution of economic power in the world; that is, scientifically and technologically developed countries increasingly tend to distance themselves from countries which simply consume knowledge.

In the face of globalization and open markets, some structural changes are already being felt by farmers and companies that develop technologies for agribusiness. These include: the need for increased productivity, improved quality of food and its greater utilization. This combination of factors will lead to increased competitiveness only if there is a reduction in costs. All these trends can be replaced by a single trend: the increasing demand for biotechnology which results in the improvement of agricultural crops.

In conjunction with certain situational factors such as the depletion of non-renewable resources and the search for new energy sources, increasing environmental awareness is driving us towards the creation of recycling policies, the need for wastewater treatment, the recovery of degraded environments and the consolidation of bioremediation. All these conditions also lead to increased demand for biotechnology.

In human health, the aging population, together with the increase of urban diseases, highlights the need for development of new diagnostic systems in medicine, the creation of molecular strategies for the controlled release of drugs in the body, and new drugs, reaffirming the importance of biotechnology in this context.

The current increase in demand for biotechnology should also be analyzed as a requirement of agriculture structured as agribusiness, whose greatest challenge is to supply the growing domestic market and remain competitive in an external market affected by protectionism and excess supply (JESUS et al., 1998). There has also been an increase in the regional market in Latin America. Concomitantly, a new procedure has become established, especially abroad, which consists in greater interaction between education and research institutes (ERIs) and the productive sector, a path that has been taking effect in Brazil thanks to increased political-institutional coordination. The development of biotechnology products and processes is, like the research that gives rise to it, essentially interdisciplinary. This makes it difficult to carry out R&D at companies which are biotechnology users, even at the large ones. Thus, there are opportunities for technology-based companies operating at the business-university interface.

Craveiro and Guedes (1995) show that the period of 1981 to 1992 was when then most intense development of the biotechnology industry occurred. Thirty-six companies were created and biotechnology enclaves and government actions emerged to demonstrate the viability of the sector. Approximately 50% of the companies created in this period were small and medium sized, with approximately 20 employees. Annual investment in biotechnology R&D is estimated at US$ 16.7 million for private companies and US$ 38.3 million for public research institutions. The average investment in R&D relative to sales was 7.2%. Research in the field of biotechnology is carried out in universities and public institutions.

According to the same study, the subsequent events which occurred were: (a) the creation of Embrabio (Empresa Brasileira de Biotecnologia S/A) and the Microbiológica company in 1982; (b) the emergence of production poles, foundations and centers to promote biotechnology, with the support of federal, state and foreign governments (Polo Bio-Rio, Centro de Biotecnologia do Rio Grande do Sul, Fundação Biominas, Centro de Desenvolvimento Biotecnológico); (c) the emergence of biotechnology companies linked to the production poles (Simbios, Genoma, Millirio, WL Imunoquímica, Backtron, Vectron, Biológica); (d) the emergence of environmental biotechnology companies importing products and providing specialized services (Biobac, Microbac, Bactrat); (e) the starting up of companies producing equipment and raw materials for biotechnology (Pharmacia); (f) the participation of enzyme producing companies (Knoll, Novo Nordisk); (g) the proliferation of small plant biotechnology companies (Multiply, ProClone) and human health (Genome) or animal (Pitman-Moore) biotechnology companies; (h) the creation of biological inoculant and biological control production companies (Geratec, Solofix), among others.

According to Ernst & Young (BIOTECNOLOGIA..., 2002), the biotechnology industry closed 2001 with a record volume of over US$ 27 billion in transactions from about 60 deals completed, compared with transaction volume of US$ 9 billion from 84 deals completed in 2000. These deals included the announcement of the acquisition of Immunex Corporation by Arngen Inc. in a transaction worth US$ 16 billion in cash and stock, thus making it the largest merger in the history of the industry. The trend in mergers and acquisitions in the biotechnology sector continued in the year 2002 (BIOTECNOLOGIA..., 2002), as a result of the fact that several pharmaceutical companies, realizing the imminence of the deadline for patents on important drugs, chose to invest in this area, in order to be able to include new drugs in their portfolios.

In the 1990s, it was estimated that there were 76 biotechnology companies in operation. Most were manufacturers of biotechnology-based products, but many were local companies and subsidiaries of multinationals engaged in the distribution of imported biotechnology products. The presence of companies providing consulting services and companies manufacturing analytical equipment and instruments can also be noted. About 57% of companies report that they perform R&D, with approximate annual investment of approximately US$ 16.6 million, or US$ 447.90 per researcher.

The Cooperative of Sugarcane, Sugar and Ethanol (Alcohol) Producers of the State of São Paulo (Copersucar S.A.) [Cooperativa de Produtores de Cana-de-Açúcar, Açúcar e Álcool do Estado de São Paulo] through its Technology Center, conducts research for genetic breeding of sugar cane, with a view to achieving more productive and longer lived species. In the industrial area, it conducts various projects to optimize fermentation, utilize by-products and develop new biotechnological processes that use sugar as a carbon source. Its varieties represent approximately 50% of all sugar produced in the country. Other companies operating in this sector include Omtek Indústria e Comércio Ltda., which investigates the production of sugarcane derivatives using biotechnology-based processes.

Brazil’s agricultural economy ranks in ninth place globally (ODA et al., 2000), but the country exports only 7% of its agricultural GDP. Among the major crops, the most prominent are soybeans, corn and sugarcane. Brazil’s soybean production ranks second in the world market: it had a volume of 35 million tons in the period 1998-1999 and reached the figure of 51 million tons in 2003 (versus 65 million tons from the United States). Corn is the second biggest product. It has a cultivated area of 7.8 million hectares and an annual production of 32.6 million tons, with low productivity. The expansion of soybean cultivation in the South was accompanied by the installation of industries producing inoculants.

Several companies perform R&D activities associated with the agricultural sector, for example: Yakult S.A., which investigates the cultivation of meristems for the improvement of fruit varieties; Fundação Bio-Rio, which is developing protocols for micropropagation and somatic embryogenesis of eucalyptus; Biotecnologia Aplicada, which works in fermentation processes and formulation of biological insecticides (CRAVEIRO; GUEDES, 1995). Other highlights include the Biológica company, a consultancy firm that conducts R&D in microbial leaching of phosphorus in minerals, biodegradation of cyanates and biological removal of mercury.

In the field of human and animal health, Biobras S.A. is investigating various fields of study with human insulin, vaccines against leishmaniasis, fermentation and recombinant proteins. Vallée S.A. develops animal vaccines, growth hormones, parasites for fermentation and veterinary diagnostic kits. This company received the Innovation Award in 2001. Ten institutions produce diagnostic kits, including the Oswaldo Cruz Foundation [Fundação Oswaldo Cruz], Bayer S.A., the Paraná Institute of Technology (Tecpar) [Instituto de Tecnologia do Paraná], Rhodia-Mérieux Veterinary Ltda. and WL Produtos Imunoquímicos Ltda.

In Brazil, there are 32 business incubators in operation and 15 more in planning, including: the Center for Technology Business Incubation in São Paulo (CIETEC) [Centro de Incubação de Empresas Tecnológicas em São Paulo]; the Business Center for Production of Advanced Technologies of Santa Catarina [Centro Empresarial para Laboração de Tecnologias Avançadas de Santa Catarina]; the Technology Park Foundation of Paraíba [Fundação Parque Tecnológico da Paraíba]; the Incubator of Technology-Based Businesses of Pernambuco (INCUBATEP) [Incubadora de Empresas de Base Tecnológica de Pernambuco]; the Technology Development Park of the University of Paraná [Parque de Desenvolvimento Tecnológico da Universidade do Paraná]; the Technology-Based Business Incubator of the Biominas Foundation (Habitat) [Incubadora de Empresas de Base Tecnológica da Fundação Biominas]; the Betin Technology Incubator (ITEBE) [Incubadora Tecnológica de Betin]; and, finally, the Technology-Based Business Incubator of the Federal University of Viçosa (CENTEV/UFV) [Incubadora de Empresas de Base Tecnológica da Universidade Federal de Viçosa].

Companies and public research institutions working in the field of biotechnology prepare a wide range of products, which include the use of first and second generation biotechnological techniques, and products involving modern biotechnology and genetic engineering using recombinant DNA techniques.

In the agricultural biotechnology sector, seeds, pesticides, biological pesticides, additives, fertilizers and diagnostic kits are produced. A sector of great prominence produces inoculants and micronutrients for legumes, and biological insecticides. Nitral Indústria e Comércio de Inoculantes e Produtos Agropecuários Ltda. leads the national market for inoculants. The company formed a joint venture with Urbana Laboratories, the largest American company in the industry, creating Nitral Urbana. The Brazilian seed market has sales of approximately US$ 1 billion a year (PIMENTA-BUENO, 2000). Brazil has not yet authorized the production of transgenic crops, but various research institutions, especially Embrapa, do have varieties which can quickly reach production scale.

In the field of biotechnology for human health, antibiotics, vaccines and serums, hormones and therapeutic products are sold commercially. This area has a significant participation by public sector entities, such as the Butantan Institute [Instituto Butantan] and Fiocruz.

In the area of biotechnology for animal health and production, vaccines, hormones, pesticides and veterinary diagnostic kits are produced. In the food industry, additives, enzymes, organic acids, amino acids, and bioadditives and sugarcane derivatives are produced.

Policies, incentives and financing

Brazil has tools to support science, technological development and innovation. The main sources of funding are the National Council for Scientific and Technological Development (CNPq) [Conselho Nacional de Desenvolvimento Científico e Tecnológico] and FINEP (Research and Projects Financing) [Financiadora de Estudos e Projetos], also known as the Brazilian Innovation Agency, which report to the Ministry of Science, Technology and Innovation (MCT) [Ministério da Ciência, Tecnologia e Inovação]. The MCT operates the National Scientific and Technological Development Fund (FNDCT) [Fundo Nacional de Desenvolvimento Científico e Tecnológico] for research projects conducted in university centers and institutes and the Support Program for Scientific and Technological Development (PADCT) [Programa de Apoio ao Desenvolvimento Científico e Tecnológico], which promote integrated projects capable of producing significant impacts in strategic areas. PADCT has granted an annual average of 7% of its total funds to biotechnology projects.

Brazil allocates approximately 0.9% of its GDP to science and technology. About 30% of this value corresponds to funds companies spend on R&D. This investment is US$ 1 to 1.2 billion per year. One study found investment in R&D and innovative engineering of US$ 1.4 billion in 1997.

Brazil’s venture capital market is emerging, with efforts seen from the Brazilian Development Bank (BNDES) [Banco Nacional de Desenvolvimento Econômico e Social], through its subsidiary BNDES Participacões S.A. (Bndespar) and FINEP. BNDES is a financial institution with a history of more than 15 years of venture capital investments. Since its inception, the two main programs of Bndespar have invested the equivalent of US$ 106.5 million: US$ 45.5 million for the Capitalization Program for Technology-Based Companies and US$ 61 million in emerging companies. Bndespar launched its fifth venture capital program for small and medium enterprises with more than US$ 200 million, in addition to providing financial support to emerging technology-based companies in Santa Catarina and Rio de Janeiro. Participants in these funds include the Multilateral Investment Fund (FUMIN) [Fundo Multilateral de Investimentos] of the Inter-American Development Bank (IDB), Brazil’s Micro and Small Business Support Service (Sebrae) [Serviço Brasileiro de Apoio às Pequenas e Médias Empresas], private investors and state pension funds (PIMENTA-BUENO, 2000).

FINEP has a tradition of supporting science and technology projects and institutions. In recent years, it has sought to transform itself into the country’s agency for renewal. FINEP operates mainly in supporting technological development and innovation, making use of various instruments in a coordinated and integrated manner. It gives preference to companies and institutions that participate in the development of new products and processes. In 2000, FINEP launched its Innovation Project in support of the venture capital industry, which is associated with the IDB, Sebrae, the Petros Pension Fund, the National Association of Science Parks and Incubators (Anprotec) and the Software Export Promotion Agency (Softex). The Innovation Project works in six areas: Venture Capital Fund, Support System for the Creation of Funds, Venture Capital Rounds, Venture Capital Portal, Broker Network and Entertainment Programs.

The impact of the Internet sparked strong interest from the private sector and led to the creation of at least 30 investment funds, banks and companies, with capital totaling over US$ 1,600 million, according to a survey done by the consultant Steffen & Pozzi, of Porto Alegre. The main funds are: Opportunity (US$ 260 million), Cadepar (US$ 110 million), Bank Boston (US$ 80 million), Banco Fator (US$ 60 million), Pactual (US$ 40 million), Dynamo (US$ 30 million) and Westsphere (US$ 30 million). Trade magazines highlight the presence of individual investors, whose businesses range from towel factories to biotechnology startups (ODA et al., 2000).

In 1981, the federal government created the National Biotechnology Program (PRONAB) [Programa Nacional de Biotecnologia]. As of 1990, government policy on biotechnology was transferred to the Biotechnology Department of the MCT, without, however, affecting the continuity of PRONAB’s activities. The 2000-2003 Multi-Year Action Plan (PPA) [Plano Plurianual de Ação] contributed funds from the Treasury, around US$ 270 million for the Innovation for Competitiveness program [Inovação para a Competitividade], out of a total of US$ 3.1 billion. It’s still too early to confirm whether there’s the will to increase the priority of R&D as part of public planning. The budget for 2000 allocated funds of approximately US$ 120 million for the National Scientific and Technological Development Fund (FNDCT) [Fundo Nacional de Desenvolvimento Científico e Tecnológico], while in 1999 the amount invested was US$ 25 million.

The CNPq has a Biotechnology Program to Support International Competitiveness of Agriculture (Bioex) [Programa de Biotecnologia de Apoio à Competitividade Internacional da Agricultura]. Its goal is to help along with the productive sectors of agriculture in order to reduce existing technology gaps, while at the same time stimulating the competitiveness of products using biotechnological processes. The program promotes partnerships between the CNPq, Embrapa, universities and the productive sectors, for the formulation of projects, studies, etc. Projects are evaluated and approved by the CNPq, which finances them and also performs monitoring and final evaluation.

Embrapa’s Development Program for Basic Research in Biotechnology [Programa de Desenvolvimento da Pesquisa Básica em Biotecnologia] is a tool for guiding Embrapa’s biotechnology policy in accordance with market demands. It encourages research into fundamental biological processes to generate knowledge and new technologies for sustainable development of the agricultural sector. Its main objectives are: (i) to contribute to the development of new varieties with resistance to the stress of agro-ecological systems; (ii) to assist the recovery and maintenance of the environment; (iii) to reduce the need for agricultural inputs; (iv) to increase the area under cultivation. Uncertainty over the subject of genetically modified organisms causes difficulties in fund-raising for biotechnology research.

Finally, it is worth noting that the Brazilian states have legislation providing instruments to support R&D, translated into specific institutions. A highly relevant case is the State of São Paulo, where the São Paulo Research Foundation (FAPESP) [Fundação de Amparo à Pesquisa do Estado de São Paulo] provides more than 60% of state-level funds for science and technology. After São Paulo, the next most prominent states are Rio de Janeiro and Minas Gerais, with these three providing 80% of state-level resources. Business incubators also play an important role. Technology parks focused on biotechnology (Bio-Rio, Biominas, the Biotechnology Development Center (CDB) [Centro de Desenvolvimento Biotecnológico] in Joinville, and the Biotechnology Center of the State of Rio Grande do Sul (CBERGS) [Centro de Biotecnologia do Estado do Rio Grande do Sul] have received a total public investment on the order of US$ 30 million.

Research infrastructure and human resources

Fiocruz works with methods of epidemic control and clinical and social monitoring of diseases, as well as the development of basic inputs for the sectors of immunobiology, medicines and blood products. This foundation focuses on R&D for infectious and parasitic diseases. The Institute of Immunobiological Products [Instituto de Produtos Imunobiológicos] is Latin America’s leading developer and producer of bacterial and viral vaccines, as well as diagnostic materials. Its departments are studying the molecular mechanisms of infection in diseases such as Chagas disease and leishmaniasis, and specialize in immunoparasitology, genetics, multiplication of adenovirus antigens and the development of antigens against hepatitis B and hepatitis C using recombinant DNA techniques. This foundation is the reference center for development of diagnostic materials and diagnostic kits. Fiocruz accounts for about 44% of domestic vaccine production and has a capacity of 200 million doses per year.

Embrapa has advanced technology for animal breeding, such as transfer, freezing and micromanipulation of embryo sexing. It also plays a dominant role in the technology of breeding improved plant varieties, which allows reducing production costs, while increasing productivity. Tissue culture techniques make it possible to produce seeds which are free of pathogens for economically valuable plants such as bananas, peaches, potatoes, and others. The area of biological control develops processes for producing biological insecticides and using natural control agents against pests affecting cotton, corn, cassava, soybeans, tomatoes, and others.

In 1985, the Butantan Institute organized the Biotechnology Laboratory [Laboratório de Biotecnologia], with the goal of modernizing and developing serums, and producing vaccines. In 1988, the Center for Biotechnology [Centro de Biotecnologia] was created, oriented towards developing new technologies in the fields of serums and antigens, blood products, diagnostic equipment for bloodborne diseases and monoclonal antibodies. The Center develops and transfers processes to the productive sector, such as the recombinant vaccine against hepatitis B. The Butantan Institute, together with the Adolfo Lutz Institute and Fiocruz, is developing a vaccine against meningitis B/C.

The Biotechnology Center (the Chemical Division of the Institute for Technological Research (IPT) [Instituto de Pesquisas Tecnológicas]) created in 1975, is a development and technology transfer group. Since the 1980s, it has returned to researching new processes for controlled action of microorganisms and enzymes, generating economically and socially important biological products. The IPT’s activities in biotechnology involve other groups at the institution, organized within the Biotechnology Program. They focus primarily on fermentation processes for environmental, agricultural, mineral, and energy areas, and raw materials for the chemical and food industries.

The Biotechnology Center of the State of Rio Grande do Sul (CBERGS) [Centro de Biotecnologia do Estado do Rio Grande do Sul], of the Federal University of Rio Grande do Sul (UFRGS) [Universidade Federal do Rio Grande do Sul], was created in 1981 as a result of an agreement between that state’s federal university and the state government, the Fundação de Amparo à Pesquisa do Estado do Rio Grande do Sul (FAPERGS) [Research Support Foundation of Rio Grande do Sul], the Banco de Desenvolvimento do Rio Grande do Sul (BADESUL) [Rio Grande do Sul State Development Bank], CNPq and FINEP. Its lines of plant research include: diagnostic reagents –viruses and parasites, entomopathogenic fungi, molecular biology and quality control of the Rhizobium genus. It also works in the field of animal breeding and development of diagnostic reagents and mechanisms of mutagenesis. In 1988, it was merged into the Biotechnology Department of the Biosciences Institute of the Federal University of Rio Grande do Sul (UFRGS).

The Brazilian Biotechnology Society (SBBiotec) [Sociedade Brasileira de Biotecnologia], founded in 1988, is a nonprofit civil institution founded for the purpose of promoting biotechnology through basic and applied research and technological development in an integrated manner, in order to provide enabling technologies to the production and service sectors. In 1999, SBBiotec was restructured to support scientifically rigorous development in this area.

Public perception

In 1988, a pilot plan was carried out for assessing the public perception of biotechnology, taking as reference similar experiences in the UK. Five hundred interviews were conducted in three cities: Porto Alegre, São Paulo and Rio de Janeiro. The results provide the following statistics: 53% of respondents indicated they had heard of the term biotechnology, while 47% hadn’t; 53% agreed with idea of using genetically modified crops resistant to insecticide, versus the remainder who did not share this idea. Official food inspection controls were considered weak by 63%, average by 29% and effective by 3%.

The recent introduction of recombinant DNA technology applied to agriculture has stimulated public mobilization by consumer protection agencies and nongovernmental organizations, resulting in political and legal repercussions. Recently, Brazil’s Federal Regional Court of the Fourth Region established a precedent by banning the use of genetically modified corn from Argentina for animal feed.

The debate about whether to maintain the situation regarding the commercialization of transgenic soybean was analyzed by the president, who decided to coordinate policy on this matter, in view of the various approaches made by public sector bodies. The Brazilian Society for the Advancement of Science (SBPC) [Sociedade Brasileira para o Progresso da Ciência] was in favor of mandatory labelling.

Strengths, weaknesses and prospects

In Brazil, between 30% and 40% of GDP comes from the agribusiness complex. The great contribution of biotechnology to helping issues such as environmental pollution and agricultural management is to increase food production, improving quality without harming the environment. This tendency, coupled with the need to be responsive to the domestic market and remain competitive in protectionist foreign markets with their excessive supply, is deserving of increased investigation. Scientific research institutes have shown a reasonable competence in generating knowledge in various areas of the biological sciences. In agribusiness, positive results have been obtained in genetic improvement of coffee and corn, and recently, soy and eucalyptus, segments where the country has the possibility of becoming internationally prominent, with huge competitive advantages to be leveraged.

Brazil plays a major role in the development of agricultural biotechnology, thanks mainly to its domestic market and the capabilities developed by its R&D centers. The country has the greatest biodiversity on the planet, a major source of raw material for biotechnology in this coming century. One example worth noting is the study in which 20 laboratories collaborated on sequencing the genome of the bacterium Xylella fastidiosa, an organism that attacks citrus.

The country has opportunities, expertise, institutional infrastructure and laws which make it possible to develop agricultural biotechnology with satisfactory biosafety conditions. Embrapa is developing a plant genetic improvement program for plants grown in tropical and subtropical zones. The incorporation of genetic constructions conferring resistance to pests and diseases and the adaptation of varieties to adverse environmental conditions, with increased nutritional and pharmaceutical value, can consolidate the country’s position in the production of grains, fiber and oilseed crops.

In human health, the aging of the population and the intensification of urban diseases require increased production of diagnostic kits, mechanisms for the controlled release of drugs and new drugs (COLLET, 2002). Brazil has good capacity in biotechnology, where a dominant role is played by human health research specializing in biotechnology.

Sources of funding for research activities are diverse, with a wide range of instruments available for promoting technological innovation. Commercial activity being conducted using biotechnology is limited. It is connected to the areas of human and animal health and also has some applications to agriculture, yet there are few companies applying modern biotechnology to their production processes, which thus results in limited industrial production.

At both the scientific and the commercial level, Brazil faces difficulties, in researching and applying biotechnology, respectively. With the exception of agribusiness and pulp and paper companies, the remaining companies encounter limitations when building their innovation network, mainly because they lack sufficient financial resources. To change this situation, government and the private sector have drawn attention to the need for greater interaction between R&D institutes and the productive sector, as well as better political-institutional coordination, recognizing that increasing the amount of products and processes using biotechnology requires an interdisciplinary approach. The conducting of R&D in companies using biotechnology and the establishment of small and medium enterprises more consistent with the current Brazilian situation are hindered by this lack of interdisciplinary perspective (JESUS et al., 1998).

Chapter 2
Biotechnology in Argentina

The biotechnology industry and its products

The development of biotechnology in Argentina had its greatest impetus during the 1980s. In 1982 the government of Argentina launched the National Biotechnology Program and programs of cooperation were simultaneously established with Brazil (CABBIO, the Argentine-Brazilian Biotechnology Center) and with industrialized countries (France, the European Economic Community). Official scientific and technological institutions took part in this process, but the climate did not last through the 1990s, affected by the economic crisis, by the opening up of the economy and by changes in business and government strategy.

There hasn’t been an updated survey on the size and structure of the biotechnology industry in Argentina. However, it is possible to arrive at an estimate, based on various databases. Using these sources of information1, it is possible to confirm the existence of more than 50 companies, a figure that includes a wide range of activities, ranging from the use of inputs in production processes to the preparation of modern biotechnology products with recombinant DNA techniques. Several companies have their own R&D laboratories2.

The industrial application of biotechnology has had its greatest impact in the pharmaceutical industry, which combines a long tradition in biomedicine with an active domestic industry, controlling around 50% of the market3. Next in order of importance is the veterinary medicine sector. The diagnostic reagents industry has also had a strong impetus, strengthened by a good pre-existing production base. The presence of biotechnology companies and products in the pharmaceutical industry is significant. There exist a considerable number of products based on internal development efforts, as well as and several products manufactured and sold commercially under license. Among these companies is BioSidus, which produces various modern biotechnology products using recombinant DNA techniques. Also present in this sector are PC-GEN SRL, Laboratiorios Beta, and Rontag S.A.

The pharmaceutical industry is represented by the Argentine Chamber of Medicinal Specialties (CAEME) [Cámara Argentina de Especialidades Medicinales], which includes the multinational industry members, and the Argentine Association of Pharmaceutical Laboratories (CILFA) [Cámara Industrial de Laboratorios Farmacéuticos Argentinos] and Argentina’s Business Chamber of Pharmaceutical Laboratories (COOPERALA) [Cámara Empresaria de Laboratorios Farmacéuticos], which include the domestically owned industry members. Another prominent industry organization is the Center for Studies in Development of the Chemical and Pharmaceutical Industry of Argentina (CEDIQUIFA) [Centro de Estudios para el Desarrollo de la Industria Química-Farmacéutica Argentina], composed of professionals from various fields emphasizing the advancement of scientific and technological knowledge as a key factor to controlling disease, and cooperation between the scientific and medical sectors and government and industry.

In the area of diagnostics, capabilities are available in molecular oncology; leukocyte differentiation antigens; paternity testing and forensic identification of individuals; genetic predisposition to hereditary diseases; and diagnoses of infectious diseases such as cholera, HIV and hepatitis B and C. There are national companies that use advanced technology, including: Laboratorios Britania S.A., Organon Teknika Argentina S.A., Polychaco S.A.I.C., and Wiener Laboratorios S.A.I.C. Smaller companies with a strong emphasis on R&D are also found, such as Tecnología Genética, which is a research center that works as a support structure for third parties, and sophisticated service providers for human health analysis and diagnostics, such as Biocentífica. Finally, it is worth highlighting the activities of transnational corporations in the field of infectious diseases, although most are involved in the commercial sale of products. This sector is represented by the Argentine Chamber of Diagnostic Reagents (CAPRODI) [Cámara Argentina de Reactivos para Diagnóstico].

A significant number of biotechnology companies are represented by the Argentine Forum on Biotechnology (FAB) [Foro Argentino de Biotecnología], which is a private, nonprofit organization. Its objectives are to spread biotechnology within the county, to develop policies in the area, and to serve as tool for coordination and a liaison for developing joint strategies between the private, scientific-technological and state sectors. Its members include more than 30 entities: companies and business associations, colleges and university departments and national bodies in science and technology – including the National Institute of Agricultural Technology (INTA) [Instituto Nacional de Tecnología Agropecuaria], the Secretariat of Technology, Science and Productive Innovation (SeTCIP) [Secretaría de Tecnología, Ciencia, e Innovación Productiva], the Science and Technology Commissions of the Chambers of Deputies and Senators of the National Congress, and the Bank of the Province of Buenos Aires [Banco de la Provincia de Buenos Aires].

The agricultural sector is a vital component of the Argentinian economy. Agricultural production is 63 million tons and the export balance is 50 million tons – Argentina is the world’s fourth largest producer of food. Approximately 30% of production corresponds to the varieties genetically modified using biotechnology, which makes the country the second largest producer of these seeds. In 1999, soybean exports were 19.95 million tons, worth approximately US$ 3.600 billion, of which 90% were transgenic. In 2001, Argentina exported a total of US$ 1.374 billion in oilseeds and oleaginous fruits, representing a 36% increase over 2000. In the 2000/2001 season, more than 10 million hectares of these crops were under cultivation. The area under cultivation planted with insect-resistant transgenic corn went from 6% in 1999 to about 25% in 2000/2001, and insect-resistant cotton went from 1% in 1998 to 3.6% in 1999.

The market for seeds from Argentina involves a volume of approximately US$ 500 million, plus about US$ 110 million corresponding to hybrid seeds. The private sector consists of more than 22 companies that pursue activities of breeding, plant micropropagation, herbicide and insecticide protection and development of inoculants. The seed companies are subsidiaries of national-owned companies and multinationals. They work with corn, wheat, sunflower, cotton, potato, soy and chili. The companies in this sector include: Advanta, Bayer, Monsanto, Novartis, Zeneca, ICI Argentina and Criadero Klein. New developments have been applied to oilseed rape, strawberries and flowers. The production of oils and pellet protein soybean meal reached the figure of 13,386,000 tons and 9,922,000 tons, respectively. The export of soybean meal protein was 13 million tons in 1999, worth US$ 1.800 billion.

The entity representing seed producers and breeders is the Argentine Seed Growers Association (ASA) [Asociación de Semilleros Argentinos], which is also an institutional member of the Argentine Forum on Biotechnology (FAB) [Foro Argentino de Biotecnología]. Its objectives are to promote the activity of seed production, provide Argentinian producers with seeds of the best possible quality and contribute to maintaining the international competitiveness of Argentinian agriculture. The ASA supports the incorporation of new technologies, in order to provide transparency on the issue in official and domestic spheres, between producers and users, meet biosafety standards, and participate in the development of legal and regulatory aspects of this new activity.

Also noteworthy is the presence of companies that produce biopesticides, such as Síntesis Química, and others using plant tissue culture technologies and micropropagation of seedlings, such as Agrogenética, Garbi and Tecnoplant S.A. The inoculants producing industry has performed well, although it is affected by decreased demand and the resulting inefficiency of production plant.

Companies producing veterinary vaccines constitute an important sector4. A number of firms – domestically owned Laboratorios Paul, Instituto Rosenbusch, Sanidad Ganadera, San Jorge-Bagó and Biogénesis, and foreign-owned Bayer, Coopers, Estrella-Mérieux and Pfizer – participate in a market of US$ 75 million per year5. The sector of biological products includes sales of US$ 25 million annually. The poultry vaccine market is important: currently, there are certain innovations made by companies such as Bedson S.A. and Laboratório Delamer. Also significant is the development of high-quality antiparasitic compounds, with a market of US$ 38 million annually. This contrasts with the limited progress in the application of biological products using biotechnology for the control of diseases such as brucellosis and tuberculosis, which have been endemic for the past 30 years. Annual sales in the area of small pets reach US$ 12 million. Another area worth noting in this industry are firms that produce growth promoters, such as Biotay and Bedson S.A.

The Argentine Chamber of the Veterinary Products Industry (CAPROVE) [Cámara Argentina de la Industria de Productos Veterinarios] brings together representatives of companies producing biological and/or pharmaceutical products for veterinary use. The Chamber has 52 active members, including domestic companies and representatives of multinationals from the industry. R&D activity is concentrated in companies of national origin and use of biotechnology is reduced to a small universe of companies. CAPROVE is an active player in establishing the regulatory framework for this activity in Mercosur.

In the country, enzymes are produced for industrial use. From the perspective of biotechnology, the most important company in the sector is Milar – a joint venture between Arcor and Miles. Other companies participating in the sector include Enzur and Enzimas S.A. In the food industry, a study funded by CamBioTec6 (VACCAREZZA, 2000) identified the applications of advanced biotechnology in the sector. The data from the study showed that only 8% of companies have incorporated the above-mentioned techniques into their production process; approximately 46% used inputs which they themselves produced; and the remaining 46% have no linkage between them.

In recent years, the dynamic of creating production poles, technology parks and business incubators has resulted in a limited number of new companies in biotechnology. These include companies located in INTA’s Technology Innovation Parks and others created by undergraduate students in Biotechnology at the National University of Quilmes [Universidad Nacional de Quilmes]. The Cell Culture Laboratory of the Biochemistry and Biological Sciences School of the Universidad Nacional del Litoral incubated the technology company Zelltek SRL. Its creation is linked to the repatriation of researchers who had done their post-doctoral studies at Gesellschaft für Biotechnologische Forschung (GBF; now Helmholtz Center for Infection Research, HZI) in Germany. The company produces recombinant human erythropoietin. It has, either in development or ready for transfer, a recombinant human colony-stimulating factor for granulocytes and macrophages and interferon beta 1. At the time of this writing, it is working on an investment project to upgrade its pilot plant, increasing its production capacity and locating the plant in the Center Coast Technology Park [Parque Tecnológico del Litoral Centro], involving 34 people, mostly professionals.

In the pharmaceutical field, most of the products result from using recombinant DNA technology (rDNA). The main products are prepared by BioSidus, a leading private biotechnology company in Latin America, which sells its products to Asia, Africa, Eastern Europe, and Latin America. BioSidus produces the following recombinant products: human erythropoietin, human interferons, colony-stimulating factors and growth hormones. In 2000, the company BioSidus was the largest exporter among the laboratories in Argentina, with a value that exceeded US$ 23 million, representing approximately 60% of the country’s total sales. Some biopharmaceuticals sales data give an idea of sales in the Argentine market: (a) recombinant human interferon, US$ 15 million, distributed among the four companies commercializing it; (b) human erythropoietin, US$ 20 million; (c) colony-stimulating factors, between US$ 10 and US$ 12 million; (d) insulin, US$ 15 million; (e) human growth hormones, US$ 7 million. In the year 2000, the country exported about US$ 30 million in products for the healthcare sector obtained using recombinant DNA technology.

Vilmax S.A. is another company making contributions to the field of biotechnology, developing specific stains for protein purification.

In the area of veterinary vaccines, there is the production of a vaccine against bovine neonatal diarrhea caused by rotavirus, a product developed as the result of a joint project between CEVAN (Center for Animal Virology) and CONICET (National Council for Scientific and Technical Research). Other examples of public-private collaboration include the vaccines developed by the Virology Lab of the National Institute of Agricultural Technology (INTA) which were produced and commercialized by Biogénesis and San Jorge-Bagó labs. Biogénesis is also responsible for producing vaccines against foot-and-mouth disease (FMD).

The activity in the biotech food industry focuses on production of high-fructose corn syrup, and its intermediate product, glucose syrup. This activity is developed by five companies: Alimentaria San Luis, Arcor and Georgalos, which are domestically owned, and Industrias de Maíz and Refinerías de Maíz, which have been acquired by global food companies. The products are used by the food and beverages industry. The Lactobacillus and Bifidobacterium species are considered probiotic, contributing to the intestinal microbial ecosystem. SANCOR and La Serenísima-Danone, two leaders of the Argentine dairy industry, have modified probiotic strains and incorporated them into their products (Leche BIO from SANCOR, and Yoghur GG from La Serenísima-Danone).

Several local companies produce inoculants based on Rhizobia for nitrogen fixation in soy, alfalfa and bean crops. Síntesis Química produces an insecticide based on Bacillus thuringiensis, and Agrogenética, Garbi and Tecnoplant S.A. produce bananas, strawberries, blueberries [arándano], yerba mate and ornamental plants by micropropagation.

In the agricultural sector, Argentina has entered the GMO era with the marketing of transgenic soybean seeds (Roundup Ready), which are resistant to glyphosate. The genetically modified seeds sold in the country are: herbicide-resistant soybeans, Lepidoptera-resistant Bt corn, Lepidoptera-resistant Bt cotton, and glufosinate ammonium tolerant LL corn. The areas under cultivation for the first three crops during the 2000/2001 season were 8.55 million ha, 560,000 ha and 25,000 to 30,000 ha, respectively. The area cultivated with glufosinate ammonium tolerant corn in the 1999 season was 8,000 ha. At the Ministry of Agriculture, Livestock, Fisheries and Food (SAGPyA) [Secretaría de Agricultura, Ganadería, Pesca y Alimentación], authorization applications were pending for the commercial release of new varieties of Bt corn, glufosinate-tolerant soy and glyphosate-tolerant cotton.

Policies, incentives and financing

The financing of research, development and innovation is handled mostly by the National Agency for the Promotion of Science and Technology (ANPCyT) [Agencia Nacional de Promoción Científica y Tecnológica]. Its resources come from contributions from the national budget and loans from the Inter-American Development Bank (IDB). It operates through the Fund for Scientific and Technological Research (FONCyT) [Fondo para la Investigación Científica y Tecnológica] and the Argentine Technological Fund (FONTAR) [Fondo Tecnológico Argentino]. FONCyT supports the generation of new knowledge in basic and applied topics at public, nonprofit institutions. Between 1998 and 2000, it funded 44 biotechnology projects with a total value of US$ 46,468,581.

FONTAR supports projects to improve private sector productivity, through innovation and the development of new alternative technologies. It uses the following instruments: technological development, with contingent reimbursement, tax credits and subsidies; technological modernization, with obligatory reimbursement and tax credits; technology services and training and technical assistance with subsidies; and is supported by the application of Law No. 23,877 for the Promotion and Development of Technological Innovation.

Since its inception7, 12 companies have received financial reimbursements for US$ 5,011,021 for biotechnology projects, out of a total of US$ 6,432,932. In 2000, FONTAR began carrying out the Technology Innovation Program of the IDB/SeTCIP (Secretariat of Technology, Science and Productive Innovation). This program introduces new instruments to finance technological innovation activities, such as non-returnable contributions (ANR) [Aportes No Retornables], which subsidize up to 50% of the cost of innovation projects conducted by companies.

With regard to the private sector, the University of San Andrés estimates that 160 innovative technology-based companies have been created recently. The main catalyst has been the presence of international funds, their alliances with local capital and the emergence of a small group of “angel” investors. It is estimated that in 1999, approximately US$ 120 million was invested in venture capital projects. That same year, the Endeavor Foundation in the US evaluated 116 companies. There are also private funds specializing in the environment, such as Terra Capital, with a fund of US$ 25 million, for projects with positive impact on biodiversity and environmental conservation.

The Inter-American Development Bank (IDB) signed an agreement with Banco Credicoop Cooperativo Limitado, committing an investment of US$ 20 million to establish a Venture Capital Fund for to capitalize small businesses. The Multilateral Investment Fund (MIF) of the IDB will contribute US$ 6 million, Banco Credicoop will contribute a similar amount, and US$ 8 million will be obtained from national and international investors. The program includes training in managing venture capital and disseminating experience among administrators of financial institutions.

The government is supporting the development of private markets for venture capital, by passing a National Technology Venture Capital System law, which is being drafted in the National Parliament. The law allows the Executive branch to create promotional tools: direct contributions from the Treasury for the incorporation of venture capital companies and funds; tax incentives for companies, funds or venture capital investors; and special incentives for creating technology-based companies. Firms may be listed on the stock markets and exchanges.

Promoting and encouraging the development of biotechnology in Argentina has historically been the responsibility of the Department of Science and Technology [Secretaría de Ciencia y Tecnología], which has participated in this field since 1983, using various instruments: the National Biotechnology Program, the National Priority Program for Biotechnology and the Biotechnology Program of the Multi-Year National Science and Technology Plan (PNPCyT) [Plan Nacional Plurianual de Ciencia y Tecnología].

The PNPCyT adopted an approach focused on promoting and developing industrial biotechnology, encouraging the development of skills and the consolidation of a regulatory framework to enable innovation processes. The plan’s priorities were established based on recommendations from an exercise conducted by the Argentine Focal Point of CamBioTec. Its elaboration and subsequent implementation included active participation by leading scientists and technologists and major business entities involved in the field of biotechnology: the Argentine Forum on Biotechnology (FAB) [Foro Argentino de Biotecnología], the Argentine Chamber of the Veterinary Products Industry (CAPROVE) [Cámara Argentina de la Industria de Productos Veterinarios] and the Argentine Chamber of Process Industries (CIPRA) [Cámara de Industrias de Procesos de la República Argentina].

The authorities who took over in 1999 deactivated the PNPCyT and with it, its Biotechnology Program, although some activities and priorities continue to be used, in an inefficient manner. In 2001, the organization of a Biotechnology Commission under the National Outlook Observation Committee [Observatorio Nacional de Prospectiva], created by an agreement between the United Nations Industrial Development Organization (UNIDO) and the Secretariat of Technology, Science and Productive Innovation (SeTCIP) [Secretaría de Tecnología, Ciencia, e Innovación Productiva], failed to implement a project focusing on biotechnology in the food industry.

In the area of biotechnology in the agricultural sector, the National Institute of Agricultural Technology (INTA) [Instituto Nacional de Tecnología Agropecuaria] has had, since 1994, a National Advanced Biotechnology Program (PNBA). Its priority issues have been: plant protection, animal health and plant and animal breeding, with a strong focus on technological research. In February 2001, INTA adopted a programmatic prioritization and organization of the PNBA’s activities in order to develop basic knowledge considered to be a strategic resource for biotechnology development. The new research priorities are genomics and proteomics research, and bioinformatics as a support tool.

Finally, mention should be made of the work carried out by the production poles, technology parks and incubators created by public institutions and universities, to support the creation of new businesses. Recent research indicates that there are nine incubators with a total of 97 companies incubated and 83 in pre-incubation8. The most important are: the Coast Technology Park [Parque Tecnológico de Litoral], driven by the Santa Fe Regional Research & Development Center (CERIDE-CONICET) [Centro Regional de Investigación y Desarrollo de Santa Fe], INTA’s Network of Innovation Parks [Red de Parques de Innovación], and the Constituents Technology Pole (PTC) [Polo Tecnológico Constituyentes], which brings together various national technology organizations. Within these organizations, several biotechnology companies are being developed.

Research infrastructure and human resources

There are more than 60 research centers, institutes and groups in the country affiliated with universities and national institutes, which perform R&D in biotechnology. There are also various organizations which have developed a consistent supply in the area of technology, and more than 30 national centers, institutes and laboratories developing activities partnering with and providing services to the productive sector.

In the field of plant biotechnology, there are several relevant groups, such as INTA’s Biotechnology Institute [Instituto de Biotecnología], the Research Institute for Genetic Engineering and Molecular Biology (INGEBI-CONICET) [Instituto de Investigaciones en Ingeniería Genética y Biología Molecular] and the Center for Studies in Photosynthesis and Biochemistry (CEFOBI-CONICET) [Centro de Estudos Fotosintéticos y Bioquímicos], which have developed transgenic plants, some of which are in the stage of field trials. There are also prominent groups at the Agriculture School of the University of Buenos Aires and at the National Universities of Córdoba, La Plata, Mendoza, Nordeste and Rosario.

INTA’s Biotechnology Institute brings together a critical mass capable of developing different lines of research. It is divided into two main areas: plant biotechnology and animal biotechnology. The animal area is oriented towards developing diagnostic reagents, next-generation vaccines and molecular studies of veterinary pathogens for birds and mammals. The plant area is dedicated to projects in molecular plant pathology, genetic engineering of plants, genomic analysis, gene prospecting and developing and delivering molecular identification services.

INGEBI has a skill set giving it a multidisciplinary nature, with the critical mass to implement new technologies like genetic engineering and molecular biology, including groups related to plant biotechnology. The Institute develops agreements with local industry. CEFOBI conducts basic and applied research in plant biochemistry and molecular biology. Its priorities are: Fusarium-resistant transgenic wheat, insect-resistant transgenic cotton, and obtaining transgenic corn with resistance to the Fall Army Worm (Spodoptera frugiperda). The Northeast Botanical Institute (IBONE-CONICET) [Instituto de Botánica del Nordeste] has the country’s most important group doing tissue culture and micropropagation of woody plants, fruit trees, alfalfa, etc.

In the field of animal health, the most important groups are located at CEVAN and the Biotechnology Research Institute (IIB) [Instituto de Investigaciones Biotecnológicas] of the National University of San Martín. CEVAN, with strong capabilities in molecular virology of foot-and-mouth disease virus and rotavirus, is currently working on viral diseases impacting production. The IIB is oriented towards production of diagnostic methods and recombinant vaccines. Recently, the IIB joined the Technological Institute of Chascomús (INTECH) [Instituto Tecnológico de Chascomús], to develop recombinant proteins for application in pharmaceutical, human and veterinary medicine, and vaccine antigens, classical and recombinant vaccines. Several of these developments have been conducted in collaboration with CEVAN.

In the field of human health, there is the Institute of Experimental Biology and Medicine (IBYME-CONICET) [Instituto de Biología y Medicina Experimental], which does research in physiology, biochemistry and molecular biology. The Institute has capabilities in the areas of human and animal health, and provides advice to the productive sector in selecting and adapting technology and transferring research results. In the same field, several other institutions of excellence are worthy of note: the National Academy of Medicine [Academia Nacional de Medicina], the Institute of Biochemistry and Biophysics (IQUIFIB) [Instituto de Química y Fisicoquímica Biológicas] and various groups in the Schools of Medicine and of Pharmacy and Biochemistry at the University of Buenos Aires.

The Biochemistry Research Institute – Campomar Foundation (IIB-FC) [Instituto de Investigaciones Bioquímicas – Fundación Campomar] performs research in the fields of Biochemistry and Molecular Biology on topics such as reagents for cancer diagnosis, identification of markers specific to cystic fibrosis, and studying and developing methods to overcome problems caused by the fly Haematobia irritans irritans in cattle. The IIB-FC, the Eva Perón and Clínicas hospitals, the Ángel Roffo Oncology Institute and the School of Veterinary Science at the University of La Plata are researching the development of a genetic vaccine which would make it possible for patients to produce their own T cells to defend against different types of cancer.

The Microbiology Industrial Process Pilot Plant (PROIMI) [Planta Piloto de Procesos Industriales Microbiológicos] is dedicated to research and development of processes related to biotechnology, especially in the areas of fermentation and the use of microorganisms of industrial interest. Microorganisms are used in a wide variety of processes such as: production of alcohol, organic acids, solvents, amino acids, vitamins, hormones, cheeses, pickles, canned goods, secondary oil recovery, nitrogen fixation, wastewater treatment, biogas production, etc.

Finally, it should be noted that in the food field, there are 51 groups that perform R&D. Only 25 have satisfactory critical mass, 34 have an infrastructure in conformance with their activity, 14 have a pilot plant and 30 have equipment suitable to their activity.

There are no updated statistics on biotechnology researchers in the country. In the research centers, institutes and groups affiliated with universities and national institutes, and at companies which have biotechnology R&D departments, there are more than 300 researchers involved in biotechnology, covering a wide range of disciplines and specialties9.

INTA’s Biotechnology Institute has 56 professionals specializing in different fields, and centers belonging to the institution and to agencies promoting science and technology. The staff of INGEBI is composed of 20 researchers, most of them belonging to the research staff of CONICET and professors from the University of Buenos Aires. IQUIFIB has 27 researchers from CONICET and research fellows from 42 different institutions. The staff of IIB-INTECH is composed of 25 researchers, plus 45 research fellows from CONICET and other national and international institutions. IBYME has 36 researchers from CONICET and 39 research fellows. The Campomar Foundation has 33 researchers and 40 graduate students. CEFOBI has 5 researchers from CONICET, 8 university researchers and 8 research fellows. CEVAN has 7 researchers from CONICET, 7 university researchers and 3 research fellows.

In this sector, the activity of training of human resources is important, developed through grant systems from CONICET and, more specifically, from courses for academics and companies promoted by the Argentine-Brazilian School of Biotechnology (EABBIO). From 1986 to 2000, EABBIO funded courses attended by just over 2,000 students from Argentina, Brazil, Uruguay and Paraguay.

Public perception

In the year 2000, biotechnology-related issues started to become part of the country’s political and social agenda. This fact has highlighted some limitations of the activity, which affect its ability to develop and shape a working agenda for the public bodies responsible for updating and improving regulations. The authorities have therefore been working on creating an adequate framework for adopting governmental decisions that determine access to markets, but have been neglecting consumer-related issues.

According to a survey of entrepreneurs in the food sector (VACCAREZZA, 2000), the incorporation of advanced biotechnology would provide benefits for production, which suggests that these techniques will eventually be imposed. A greater impact of biotechnology is being observed on the environment than on human health. There is significant caution about the effects of transgenic crops on international trade and about the competitiveness of Argentine exports, in addition to questions about the processes of monopolization and technological dependence that the imposition of advanced biotechnology techniques could cause in the industry.

The Argentine Seed Growers Association (ASA) [Asociación de Semilleros Argentinos] has taken a clear position on genetically modified crops and genetically modified food labelling, stating: “The transfer of genes through recombinant DNA techniques is the most predictable construction and therefore potentially is the safest of all methods of plant breeding.” The ASA conducts a program called “Why Biotechnology” [“Por qué Biotecnología”], directed to the education sector and the public in general, via a web portal10.

Argentina recently acceded to the Cartagena Protocol on Biosafety, which regulates the exchange of genetically modified organisms, in particular seeds and other products associated with the environment, and unprocessed agricultural products meant for human food and animal feed. The Protocol states that countries can make decisions using the “precautionary principle,” based on scientific studies. The Miami Group, in which Argentina is a participant, argues that respect for the biosafety of the environment should not be used to establish barriers to trade. The group seeks to exclude from the Protocol processed food products and products derived from genetically modified organisms, and to restrict the application of the treaty to GMOs intended only for intentional release in the importing country. The country officially rejects labelling, characterizing it as a tax measure.

The Convention on Biological Diversity is the national law in Argentina, but has not been regulated to date. Thus, there are currently no regulations governing access to biodiversity. Due to the lack national legislation, research institutes, such as INTA, are governed by international agreements such as the Code of Conduct for Access to Genetic Resources, of the United Nations Food and Agriculture Organization (FAO). At the moment, regulations for access are under discussion.

The national debate on genetically modified organisms intensified in the year 2000, starting with a campaign launched by Greenpeace, which denounced the supposed hazards of use of GMOs and demanded a moratorium on the commercial distribution of transgenic crops. Pressured by the debate, the private sector set up the Biotechnology Group, composed of the Argentine No Till Farmers Association (AAPRESID) [Asociación Argentina de Productores en Siembra Directa], the Coordinator for Food and Beverage Industries (COPAL) [Coordinadora de las Industrias de Productos Alimenticios], the Grain Exchanges of Buenos Aires and Rosario, the Association of Agricultural Technology Chambers (ACTA), the Argentine Forum on Biotechnology (FAB) [Foro Argentino de Biotecnología] and thirteen other entities from the field of biotechnology in the agricultural sector. The Group called for a state policy to support the development of biotechnology and rejected mandatory labelling for foods derived from genetically modified organisms.

Strengths, weaknesses and prospects

Biotechnology has quality human resources in various areas. Although some areas do not have a sufficient number of researchers, resources are available such as the following: mastery of information and laboratory-scale techniques, important international contacts, in many cases with joint research projects, and equipment that is up-to-date but not sufficient in terms of quantity. Research results are seldom translated into products or services.

In terms of basic sciences, the greatest needs are observed in certain strategic disciplines such as molecular genetics and bacterial physiology. Technological developments and pilot or production plants are few and far between, and few efforts have been made in training professionals in biochemical engineering, large-scale cell cultures and downstream processing. Applied research and technological development are not sufficiently promoted, and there are not sufficient criteria and procedures recognized and accepted in the academic and institutional spheres for assessing the activity’s relevance and impact.

The main constraints to industrial development of biotechnology stem from the lack of private investment, a situation which researchers attribute to the lack of a strong tradition of global and industry investment on the part of entrepreneurs. These low levels of investment could be remedied through measures which initially facilitate private sector investment. In developing countries, this function cannot be delegated by the State. The presence of institutes and companies in the development and promotion programs shows a relatively large range of capabilities available, although they are not organized into a portfolio of projects capable of motivating the interest of potential investors from the capital markets.

Argentina is one of the countries of Latin America which has more quickly used and developed new biotechnology products, in particular certain recombinant proteins for therapeutic application, as well as plant varieties resistant to herbicides and insects, and has thus achieved a significant increase in international competitiveness. The potential for these developments may in the near future reduce the resistance of local consumers and international markets. Clearly, a country where the agrifood sector is a pillar of the economy must attribute the appropriate value to these types of scientific development11. The successful introduction of genetically modified crops will encourage innovative behavior in other agribusiness sectors, promoting R&D, the use of modern technologies and the strengthening of inventive activity. Agricultural biotechnology is still a growing area: Argentina is receiving licenses for technology transfer from foreign companies and is competing, in world markets, with exporting countries that also have transgenic varieties.

Chapter 3
Biotechnology in Paraguay

The biotechnology industry and its products12

The most important center for the production of plant varieties micropropagated in vitro is the National Agronomical Institute (IAN) [Instituto Agronómico Nacional] that reports to the Directorate of Agricultural Research (DIA) [Dirección de Investigación Agrícola] of the Ministry of Agriculture and Livestock (MAG) [Ministerio de Agricultura y Ganadería]. The production uses equipment donated through international cooperation and has infrastructure, contributed by MAG, for the production of plantlets of species of agricultural interest. Investment in equipment, buildings and conservatories reached the figure of US$ 650,000.

The rapid multiplication of seedlings of fruit and vegetables and other species, free from diseases that were present in the parent plants, has become a reality in Paraguay, through the use of the technique of plant tissue culture. Using this technique, the IAN increased productivity by 30% to 75% in commercial crops of strawberries, bananas, pineapples, citrus and sugarcane.

The targets set for producing high quality seedlings for 2000 (parent and foundation grade) include producing seedlings for the following crops: one pineapple variety, two banana varieties, seven strawberry varieties, two sugarcane varieties, one orchid variety, and one potato variety.

These species are distributed to associated farmers in various departments of the country through joint work with state and extension agencies and/or NGOs dedicated to private technical service. The seedlings produced in the biotechnology laboratory are parent, foundation and certified grades, providing the basic material for multiplication in nurseries of seeds of other categories, allowing high quality production intended for planting. In addition, production of seedlings of roses, chrysanthemums and virus-free citrus buds is fully underway.

Experiments to adjust the methods of in vitro propagation and conservation of cassava (Manihot esculenta), papaya (Carica papaya), peach (Prunus sp.) and Stevia rebaudiana are also underway.

Research infrastructure and human resources (ALVAREZ, 2000)

Nationally, Paraguay does not have a program that coordinates activities related to agricultural biotechnology. The country has only four laboratories associated with agricultural biotechnology activities: two belong to the National University of Asunción (UNA) [Unidversidad Nacional de Asunción] and two belong to the Directorate of Agricultural Research (DIA) of the Ministry of Agriculture and Livestock (MAG).

The laboratory of the Faculty of Agricultural Sciences (FCA) of UNA and the National Agronomical Institute (IAN) of DIA/MAG basically work with tissue culture and micropropagation of plants. The laboratory of the Directorate of Postgraduate Research and International Relations (DIPRI) [Dirección de Investigación de Posgrado y Relaciones Internacionales] of UNA and the lab of the Regional Center for Agricultural Research of DIA/MAG work in the area of molecular biology. Its main activities are:

Directorate of Postgraduate Research and International Relations (DIPRI/UNA), in San Lorenzo: molecular marker techniques in genetic analysis of Rhizobium japonicum strains.

Regional Center for Agricultural Research (CRIA/DIA/MAG), in Capitán Miranda: genetic improvement assisted by molecular markers, for selection of genetic materials resistant to soybean cyst nematode (Heterodera glycines). Molecular characterization (fingerprinting) of soybean varieties.

Faculty of Agricultural Sciences (FCA/UNA), in San Lorenzo: micropropagation of plants – citrus, orchids – and diagnosis of pathogens.

National Agronomical Institute (IAN/DIA/MAG): micropropagation of strawberries, bananas, pineapples, orchids, roses, sugarcane, citrus, chrysanthemum, cassava, Stevia rebaudiana, potatoes, ferns, African violet, diagnosis of pathogens and in vitro conservation of germplasm.

DIA was created in 1984 with support from the Agency for International Development (AID) of the United States. The first biotechnology laboratory in Paraguay was created at IAN in Caacupé, Cordillera, with the following objectives:

In vitro mass clonal propagation of plants for the production of pathogen-free seedlings of high genetic quality and species of importance to the diversification of agriculture in Paraguay.

Support for programs of genetic improvement of vegetable and fruit species through the use of biotechnology techniques applied to plant breeding.

Maintenance of the in vitro germplasm collection of species and varieties of cultivated plants, such as cassava, Stevia rebaudiana, strawberries, pineapples, roses and chrysanthemum.

The IAN has four university researchers specialized in the area of tissue culture. It basically works with micropropagation of fruit, ornamental and agricultural species. In the area of molecular biology, it has had access to training making it possible to work in this area, specifically with molecular markers applied to plant breeding.

Policies, incentives and financing

IAN began operating in 1985, with technical and financial support from the International Cooperation Agency of Japan (JICA), until 1987. In 1988, the Laboratory received support from the International Atomic Energy Agency (IAEA), on a plant breeding project. Since then, the Laboratory has worked with financial support from Paraguay’s MAG.

In 1995, IAN received a grant from the International Agency for Technical Cooperation of the Republic of Korea (KOICA) for equipment and training of national experts. It also receives support from the government of Taiwan, for equipment, reagents, glassware and materials for the construction of a greenhouse.

The International Potato Center (CIP), the International Center for Tropical Agriculture (CIAT) and the Tropical Agriculture Research and Education Center (CATIE) have contributed technical assistance in the area of biotechnology, providing experts and/or training of national technicians at these institutions.

Since 1993, within the framework of the Biotechnology Subprogram of the Cooperative Program for the Development of Agricultural Technology in the Southern Cone (PROCISUR), [Programa Cooperativo para el Desarrollo Tecnológico Agropecuario del Cono Sur],13 the laboratory has participated in conferences, seminars, and in-service training courses, thus increasing the critical capacity of national experts. The PROCISUR Project called Development of Regional Capacity to Produce High Quality Plant Health Genetics contributed to optimizing existing installed capacity and also training technicians assigned to the project.

In 1997, General Science and Technology Law No. 1,028 was enacted, (PARAGUAY, 1996), which created the National Council of Science and Technology (CONACYT) [Consejo Nacional de Ciencia y Tecnología]. The Law created the National Fund for Science and Technology (FONACYT) [Fondo Nacional de Ciencia y Tecnología] as a financing instrument, and granted CONACYT the power to manage its resources. The Law provides incentives for financial companies to shift financial resources to the Fund, deductible from income tax, and establishes tax exceptions for importing equipment for scientific and technological research.

The Proposal for a National Policy on Science and Technology, prepared by CONACYT in October 2001, contains a chapter on biotechnology (PARAGUAY, 2001). It suggests further development of research in priority areas, including plant and animal breeding, and proposes the adoption and development of science and technology – in the areas of molecular biology, cellular and genetic engineering – to strengthen the capacity of generating products and processes, increasing the country’s competitiveness in international markets while conserving and enhancing genetic resources, bioavailability of nutrients and bioinformatics. It also proposes developing and strengthening a system for assessing risks and opportunities in the application of new techniques of biotechnology processes and products.

Public perception

Paraguay has been declared free of genetically modified production, and seeks to occupy a niche in the of GMO-free soybean market. The country is working on a certification system for non-GMO soybeans. A new goal is for this country to be included in the list of countries free of transgenic products for consumption, including imported food. The proposal is from Paraguay’s Rural Network of Private Organizations for Development [Red Rural de Organizaciones Privadas de Desarrollo] and Network of Environmental Organizations [Red de Organizaciones Ambientalistas].

This issue is open to debate and there are conflicting positions between the different social sectors. The Inter-American Agriculture and Democracy Network rejects the introduction of GMOs in agriculture, while agricultural producers want to rely on these productive resources. In a recent seminar14, the representative from Paraguay, Luís Cubillas Ramos, complained: “I suspect that we are doomed to technological backwardness,” as he made an extensive presentation of the situation in his country, and drew attention to trials being performed with about a dozen varieties of soybeans, with the expectation of commercial sale starting in 2002.

Strengths, weaknesses and prospects

Paraguay’s Soybean Producers Association (APS)15 called for a parliamentary debate on the planting of oleaginous seeds of transgenic origin for commercial purposes. Currently, there is a decree that prohibits the domestic commercial planting of genetically modified products. Producers, however, argue that the prohibition by the Ministry of Agriculture and Livestock lacks technical and scientific foundations and are demanding an open debate on the subject to enable them to compete with producers of soybeans in the First World, such as Canada, the US and Europe. The petition from the guild of soy producers in Paraguay, signed by Olaf von Brandenstein, vice president of the organization, emphasizes that “the ban on growing genetically modified soy lacks all scientific and technical grounds, since it has been clearly demonstrated worldwide and by different scientific sectors, that transgenic soy has no negative consequence.”

Chapter 4
Biotechnology in Uruguay

The biotechnology industry and its products

The biotechnology industry in Uruguay started to be developed in the 1980s, driven by a public sector program. Its impetus came from the convergence of a core of basic scientists at the Clemente Estable Institute of Biological Research (IIBCE) [Instituto de Investigaciónes Biológicas Clemente Estable], various schools of the University of the Republic (UR) [Universidad de la República] and several private entrepreneurs. A National Biotechnology Committee composed of public and private representatives was created, and the Uruguayan Association of Biotechnology Companies (AUDEBIO) [Asociación Uruguaya de Empresas de Biotecnología] was established. In the 1990s, the Committee was dissolved and equipment was scattered, thus losing a good opportunity for developing a cutting-edge biotechnology, with the ability to maintain control over innovation. AUDEBIO continued to function, but was unable to have an impact on government decisions. Currently, a relaunch of the organization is being planned, encouraged by the favorable climate for biotechnology noted in Uruguay.

The main private companies that carry out activities related to biotechnology are: Laboratorios Lage S.A.; Enzur and Calister in the area of inoculants; Laboratorio Santa Elena in the area of vaccines; Semillera Santa Rosa in the area of micropropagated plant varieties; Paso Alto S.A., Otegui Hnos. S.A., Forestal Oriental, Fundo Forestal and Biosur Ltda. in micropropagation of forest species; and Laboratorios Castellanos and Genia S.A. in the field of human health. The wine industry is also undergoing a process of modernization, with the incorporation of micropropagated varieties and selection of yeasts and ferments, with the greatest exponent being the company Vinos Finos Juan Carrau S.A.

Laboratorios Lage S.A. develops research with microorganisms promoting root growth in cereal grasses (wheat, barley, corn, etc.), incorporation of microorganisms (ectomycorrhizae) into pine and eucalyptus trees, and incorporation of inoculants (lactic acid bacteria) into cereal silage. The company’s production is oriented to the world market, due to the low adoption rate of innovations by Uruguayan agribusiness. Laboratorios Lage S.A. has no connection to R&D institutions in the public sector, and also has not received support from public programs for promotion and development. Other companies in this field, such as Enzur, are prominent in the production of enzymes while also developing a line of inoculants. This same type of activity is conducted by Calister, although with lower production volume.

In the field of human health, Laboratorio Genia16 is dedicated to genomic diagnostic services for viral infectious agents, inherited diseases and DNA paternity testing. They have a branch in Porto Alegre which primarily performs paternity studies. The company operates adopts well-known technologies and works exclusively as a provider of services. It also has a series of projects for developing and producing diagnostic kits17. In the company’s area of coverage, other private offerings are developed by the molecular biology laboratory of the Asociación Española de Socorros Mutuos, and Laboratorio Martínez Prado. Laboratorio Castellanos is also prominent in the field of human health, developing research on the production of reagents for syphilis, latex based reagents for the diagnosis of pregnancy, blood proteins, c-reactive factor and toxoplasmosis, as well as reagent for diagnosis of Chagas disease. The diagnostic services companies develop almost exclusively in the local market. The only exception is Genia S.A.

Laboratorio Santa Elena conducts activities in the field of biotechnology applied to animal health. This company was the protagonist of one of the biggest frustrations in biotechnology in the country. In 1987, Santa Elena got an IDB loan of US$ 2 million for the development of the laboratory, the purchase of new equipment and the construction of 1,000 m² of production area, which was to have the latest equipment for vaccine production. Uruguay was declared a country free of foot-and-mouth disease (FMD) with vaccination in 1993, when problems began to emerge for the production of vaccines since the law prohibits the manipulation of the virus by virtue of having been declared “free of foot-and-mouth disease.” For this reason, the company stopped producing vaccines and their P3 laboratory was deactivated in response to strong opposition expressed by the academic community in the country.

Currently, Laboratorio Santa Elena is overcoming these difficulties, thanks to changes, in the public sector, in laws which had negative repercussions on the development of production of biological materials18. Two lines of work are being followed: the production of biological materials and the manufacture of injectable drugs. The company exports serums and vaccines to several Latin American markets and develops an important line of manufacturing for third parties, with a volume exceeding 30% of revenues. Laboratorio Santa Elena has some projects of great interest, linked to public sector R&D, but also develops a vaccine for a virus that affects domestic animals, in collaboration with the Sciences School at the University of the Republic (UR), and develops, with the National Institute of Agricultural Research (INIA) [Instituto Nacional de Investigación Agropecuaria], a recombinant vaccine against foot-and-mouth disease (FMD). R&D activities occupy between 10% and 20% of the staff’s working time and over 30% of the directors’ time.

Semillera Santa Rosa develops and commercializes technologies and services in the field of micropropagation of plant varieties, especially pears, which are exported to several European countries. Laboratorio SESAR, from the Horticultural Research Center of Semillera, is dedicated to tissue culture, somaclonal variation and induced mutagenesis. Its main line of research is cereal grains, but it is also dedicated to other crops such as strawberries and legumes. The company’s main activity in the local environment is the use of scientific and technological resources for the production of post-grafts for growers participating in the Farm Reconversion Program [Programa de Reconversión de la Granja]19. The company has collaborative projects for aromatic herbs with the School of Chemistry at the University of the Republic (UR), and for flavoring, sanitation and cloning of wine strains, with the Turin Plant Virology Center [Centro de Fitovirología de Turín]20. In this sector of activity, there are companies that work with potatoes – family businesses such as Ponce and Fernández – and successful innovations in forestry are starting to be produced, where large companies have developed their own research laboratories.

There are also productive opportunities in bioengeineering, mainly involving research carried out with contributions from engineering and medicine, which have made it possible to equip intensive treatment centers, set up as prototypes and tested in hospitals. However, productive and commercial output are lacking. The Agricultural Research Institute [Instituto de Investigaciones Agrícolas] has proposed packages to promote biotechnology sales. The National Institute of Agricultural Research (INIA) [Instituto Nacional de Investigación Agropecuaria] also produces technological packages for specific needs. Vinos Finos Juan Carrau S.A. conducts research on the isolation of strains which help in fermentation. It has a joint program with the company Santa Rosa S.A. for the micropropagation of wine strains.

The main products of biotechnology companies in Uruguay are intended for the international market. Semillera Santa Rosa does research in collaboration with foreign public and private entities and exports all of the technology and services from its micropropagation laboratory, mainly to Italy and other European countries. Its main products are fruits (especially pears) and legumes. In the domestic market, it produces post-grafts for pears, apples, peaches and nectarines, contributing 800,000 larger plantlets and 1,500,000 smaller plantlets, all channeled to the Farm Reconversion Program.

In the field of plant production, Lage S.A. produces and commercializes a high quality inoculant which is considered world-class. The use of this product has not achieved acceptance in the Uruguayan market, so the company is using only 25% of installed capacity. Lage and other companies are exporting to Brazil, with a total amount of US$ 300,00021. Other products from this company, such as inoculants based on azospirillum for the production of cereal grains, have not been embraced by the local market, encouraging their export to Italy, where it is combined it with other products before the final product is exported to Cuba and Mexico. Plantlet substrates with trichoderma fungi are in the experimental stage. Approximately 85% of the company’s production is for export, in small volumes to the markets of Argentina, Paraguay and Bolivia.

Santa Elena produces a significant number of products, including: 2 million vaccines against brucellosis, 2 million doses of tuberculin, 1 million doses of vaccine against leptospirosis and 4 million against botulism. It produces and exports bovine sera free of foot-and-mouth disease (FMD) for vaccine laboratories in Brazil and Argentinian and oil-based vaccine adjuvants. The vaccines are intended mainly for the markets of Brazil, Colombia, Venezuela and Ecuador, with different strategies and forms of association22. They also produce vaccines and other value-added products with for international laboratories, which sell them to African and Asian countries.

The country has authorized commercial cultivation of transgenic RR soybeans, resistant to the herbicide Roundup, although soybean cultivation occupies a small area and is geographically concentrated in sectors along the border between Argentina and Uruguay. Between 80% and 90% of the cultivated area is occupied by RR soybeans. A study and evaluation are underway for a transgenic corn variety that contains a protein produced by Bacillus thuringiensis which is toxic to crop pests.

Policies, incentives and financing

The National Council on Innovation, Science and Technology (CONICYT) [Consejo Nacional de Innovación, Ciencia y Tecnología] developed the CONICYT/IDB Scientific-Technological Development Program, which allocated US$ 50 million to fund nearly 200 research projects at public and private institutions, 167 of them academic and 25 of them within the Financing for Technological Innovation subprogram (FINTEC) [Financiamiento para la Innovación Tecnológica] – to support the productive sector – the latter with the amount of approximately US$ 17 million. More than US$ 4 million has been invested in training human resources, financing institutional training programs, which include doctoral, post-doctoral, and master’s studies at local and international institutions, and invitations to foreign teachers.

For the preceding components, priority areas were defined, including biotechnology. Regarding the infrastructure works, the program financed the construction of the School of Sciences building and its scientific equipment, and the remodeling and expansion of the Clemente Estable Institute of Biological Research (IIBCE) [Instituto de Investigaciónes Biológicas Clemente Estable], with a total investment of US$ 15 million. Currently, 25 technological innovation projects are being developed, totaling more than US$ 2 million. Among these projects, 4 correspond to biotechnology initiatives, in the amount of US$ 329,450. The IIBCE is carrying out a total of 15 projects with total value of US$ 1,112,000.

The country is applying the Technological Development Program II (PDT-II), funded by a technology loan from the Inter-American Development Bank (IDB). Its goal is to mobilize the innovation potential of the country to strengthen its competitiveness in production, especially small and medium sized businesses (PyMEs). The total program amount is US$ 41.7 million, divided into three subprograms: Support for Innovation and Improved Business Competitiveness (US$ 25.7 million); Scientific and Technological Development (US$ 12 million) and Institutional Strengthening (US$ 4 million). The Innovation Subprogram finances the following business technology innovation projects: Business Partnerships, Participation of Experts in Business, Technology Consultancy, Promotion of Management Units and Technology Transfer, and Promotion of Business Incubators. Of the funds, 62% goes towards supporting small and medium sized businesses (PyMEs).

In Uruguay, there is a venture capital fund for technology-based companies. Other projects may be channeled through the National Corporation for Development (CND) [Corporación Nacional para el Desarrollo], which finances, using public funds, venture projects of established companies23. Some investors are negotiating with MIF authorities at the IDB, to create the first venture capital fund for technology-based companies oriented towards business incubator projects. However, cases have been recorded where technology-based companies have been financed by angel investors. These are small initiatives, aimed at the creation of providers of services to larger companies. In October 2000, the Endeavor foundation held a meeting with potential investors, and the Milenium 21 organization held its first event – First Tuesday Montevideo – which was attended by approximately 600 people. The purpose of these informal meetings was to create a professional work environment, to stimulate industry growth.

In 1986, the National Biotechnology Committee was created, composed of the following institutions: the Ministries of Education and Culture, of Foreign Affairs, of Public Health, and of Livestock, Agriculture and Fisheries; the University of the Republic (UR); the Clemente Estable Institute of Biological Research (IIBCE), the National Council on Innovation, Science and Technology (CONICYT) [Consejo Nacional de Innovación, Ciencia y Tecnología] and private companies. In 1987, the government passed a Law for the Promotion of Research and Development Activities in Business, with emphasis on biotechnology. However, these initiatives have expired and have not been replaced by new national policies.

The incentive system for science, technology and innovation is historically based on a “spontaneous model,” lacking institutional coordination mechanisms or explicit policies. The Directorate of Science and Technology (DCT) [Dirección de Ciencia y Tecnología] of the Ministry of Education and Culture (MEC) [Ministerio de Educación y Cultura] has operated on the basis of ad hoc science & technology (S&T) policy formulation, to further strengthen the ability to generate scientific-technological innovations and boost capacity utilization in solving national problems, especially those related to the productive sectors. The CONICYT/IDB Project and its later editions determined that, in practice, this organization should become a tacit conduit of S&T policy and the main source for promoting S&T. Recently, the creation of the National Outlook Observation Committee [Observatorio Nacional de Prospectiva] created a new space for elaborating public policies on science and technology (S&T). This Committee has selected three initial fields of interest for the country: energy, transportation and biotechnology24.

In the agricultural field, the Fund for the Promotion of Agricultural Technology (FTPA) [Fondo de Promoción de Tecnología Agropecuaria] was established by Article 18 of Law No. 16,065. It is meant to finance technological research projects relating to the agricultural sector, carried out by other institutions or persons outside the Institute, primarily in response to issues raised by the National Programs of the National Institute of Agricultural Research (INIA) [Instituto Nacional de Investigación Agropecuaria] and satisfying the needs to complement their own plans. This fund comprises 10% of the budget resources of INIA, voluntary contributions made by producers or by other institutions and overseas funds. In this same context, there is the Farm Reconversion Program [Programa de Reconversión de la Granja], which has had a good impact on the development of biotechnology applied to the fruit and vegetables sector.

Research infrastructure and human resources

The main centers of research in the area of biological sciences are certain schools at the University of the Republic (UR), and the Clemente Estable Institute of Biological Research (IIBCE) [Instituto de Investigaciónes Biológicas Clemente Estable]. In recent years, biotechnology has been developed in agriculture, through micropropagation techniques, improved strains for inoculants and use of genetic markers for selection of plant varieties by polymerase chain reaction (PCR) and restriction fragment length polymorphism (RFLP) (e.g., citrus).

The Chemical Engineering Institute of the School of Engineering at UR conducts research on organic manures. It has developed a formulation consisting of insecticides, hormones, and mineral fixers produced by fermentation of solid substrates. It also works with mycoherbicides made with fermented fungi on solid substrates and with rennin, a fungal enzyme for the production of cheese.

The Plant Biotechnology Laboratory of the School of Agronomy at UR conducts research on embryogenesis of citrus and eucalyptus trees, and on the development and application of biotechnology for genetic improvement of barley for beer production. Their primary biological techniques are electrophoresis and tissue culture. In collaboration with the Plant Protection Directorate [Dirección de Sanidad Vegetal] of the Ministry of Livestock, Agriculture and Fisheries (MGAP) [Ministerio de Ganadería, Agricultura y Pesca], they have developed a kit for serological diagnosis of diseases caused by viruses in citrus and have scheduled production of virus-free citrus buds.

In the School of Chemistry and Pharmacy at UR, the Immunology sector conducts research for the production of diagnostic kits for: toxoplasmosis, echinococcosis (hydatid disease), pregnancy, c-reactive proteins and rheumatoid factor, as well as streptomycin detection. The Biochemistry sector is researching ways to obtain a cloned strain for industrial uses and for utilization of milk whey. The Laboratory of Basic Oncology of the School of Medicine at UR is studying the production of monoclonal antibodies to characterize tumor-associated antigens and the development of antibodies that identify glycoproteins associated with breast cancer and normal breast tissue.

The School of Sciences at UR created the first Masters program in Biotechnology, by public and private initiative, with teachers from various UR Schools. The curriculum includes a dissertation on topics of interest to students and businesses. To date, 15 students have entered this program, which explores work issues in areas of wastewater treatment, oenology, recombinant proteins for medical use, etc. The School works on the development of therapeutic molecules by recombinant techniques, is connected to domestic industry and supports the installation of molecular biology services in assistance centers.

The Clemente Estable Institute of Biological Research (IIBCE) plays a dynamic role in the development of biotechnology. It works in human and animal health, producing sera and vaccines. The IIBCE has extensive national and international recognition and is considered a “regional center of excellence” by the OAS and UNESCO. Its research areas are life sciences and neurosciences. It also works on developing and applying biotechnology techniques to the study of the human genome, in order to detect the presence of tumors. Its Molecular Biology Division investigates the defense mechanisms of plants using molecular probes, hybridization and PCR. Some research lines deal with diagnosing and identifying viruses and pathogens of citrus crops, and improving resistance and stress tolerance in potatoes.

In Uruguay, significant genetic improvement activity is developed in the public sphere, heavily complemented by research performed by private companies that commercially develop the varieties. The Biotechnology Laboratory of the National Institute of Agricultural Research (INIA) [Instituto Nacional de Investigación Agropecuaria], which reports to the President’s office, and which is located at the Experimental INIA Station in Las Brujas, has developed technologies based on two main areas: cellular biology of plants and molecular biology, both applied to genetic improvement. Its R&D activity has generated the following results: super-elite grade plant stock; clones of selected plants; basic material for breeding programs; identification of varieties, breedstock and genes of interest for production; quick selection of optimal genotypes and diagnosis of pathogens. Its relationship with the private sector promotes the formation of public-private joint ventures aimed at developing technological innovations and creating new opportunities for investment and development.

The country has some resources in the area of veterinary biotechnology at the Directorate of Veterinary Laboratories (DILAVE) [Dirección de Laboratorios Veterinarios], of the Ministry of Livestock, Agriculture and Fisheries (MGAP) [Ministerio de Ganadería, Agricultura y Pesca]. Due to a bureaucratic administrative error, this laboratory was not transferred to the National Institute of Agricultural Research (INIA). For this reason, INIA lacks jurisdiction over the veterinary area and DILAVE’s budget has no funds for research and development.

Until 1990, the School of Medicine at UR and the Clemente Estable Institute of Biological Research (IIBCE) concentrated almost 60% of researchers in biological sciences, especially in the human health sector, particularly at the School of Human Physiology Research. There was a dramatic increase in human resources, with the launch of the Program for Development of Basic Sciences (PEDECIBA) [Programa de Desarrollo de las Ciencias Básicas]. Its initiatives include the creation, in 1992, of the School of Sciences at the UR, which includes the areas of Biology, Physics, Chemistry and Mathematics, and financing for master’s degrees, doctorates and post-doctorates, locally and internationally, with an investment of over US$ 4 million, and with the participation of 204 postgraduates. The field of biotechnology received 8.5% of the total amount invested.

Currently, the most well-established specialties are: immunology, microbiology, molecular biology, tissue culture, genetic engineering, neurobiology, veterinary medicine and micropropagation. Other important areas include immunochemistry, especially in diagnostic applications in human health (Chagas disease) and animal health (echinococcosis, or hydatid disease) and agriculture (Xanthomonas campestris), and the development of DNA hybridization techniques for the diagnosis of infectious diseases. In the School of Engineering, chemical engineers are trained to work in fermentation processes, production and isolation of enzymes and biotransformations applied to bioreactors for wastewater purification.

There are no general statistics on biotechnologists, but it is possible to provide some relevant figures25. The Clemente Estable Institute of Biological Research (IIBCE) has 86 researchers and 31 doctoral and masters students. Its Molecular Biology Division has two professionals and three postgraduate specialists. There are 6 specialists devoted to research at the INIA – Las Brujas, plus two graduate students. The Laboratory of Plant Biotechnology, in the School of Agronomy at the UR has five professionals and one postgraduate.

Public perception

The debate in the country about the application of biotechnology to the agrifood field is recent26. The holding of the 17th Pan American Seed Seminar and the launch of the World Forum on Biotechnology and Seed Marketing were the scenarios chosen by various parties to launch controversy over GMOs. Parallel to this event, a meeting of trade unionists, students, organic farmers, NGOs and consumers demanded a public debate about the appropriateness of using GMOs and warned of the potential harm to Uruguay’s human health and international trade27.

The mobilization was organized by the institutions: Friends of the Earth networks, Genetic Resources Action International (GRAIN), the Pesticide and Alternatives Action Network of Latin America (RAP-AL) [Red de Acción en Plaguicidas y sus Alternativas de América Latina] and the International Union of Food Workers (IUF). The organization Southern Cone Free of Transgenics [Cono Sur Libre de Transgénicos] created the slogan “Yes to life. Yes to diversity. Yes to people. No to genetically modified crops. No to globalization of transnational corporations. No to the commodification of life.” The Uruguayan Center for Appropriate Technologies (CEUTA) [Centro Uruguayo de Tecnologias Apropiadas] demanded a moratorium on the release of commercial crops and labelling of transgenic products and demanded that GMOs remain restricted to laboratories and research sites.

The position of the National Association of Seed Producers (ANAPROSE) [Asociación Nacional de Productores de Semillas] in favor of transgenics is clear. According to the Association, Uruguay shares Argentina’s interests in relation to GMOs. Uruguay has actually already been producing transgenic products for three years, mainly transgenic soybean resistant to glyphosate, a herbicide that controls weeds, making it possible to cultivate this legume free of invasive plants.

The country is aligned with the precepts of the Cartagena Protocol on Biosafety. It is a member of the Miami Group, along with the United States, Canada, Argentina, Australia and Chile, which supports respect for biosafety of the environment, without, however, allowing biosafety to be used as a barrier to international trade. The Miami Group seeks to exclude from the Cartagena Protocol processed food products and products derived from genetically modified organisms, and to restrict the application of the treaty to GMOs intended only for intentional release in the importing country. It does not agree with labelling and argues that the Protocol should not affect the rights and obligations derived from other international agreements, especially those of the World Trade Organization.

Strengths, weaknesses and prospects

Despite its small geographical area, Uruguay has many good researchers in several areas of biological sciences. Biomedical knowledge predominates, primarily in the diagnostic sector. There is strong knowledge in immunology and immunochemistry: researchers have a good understanding of the scientific and technical fundamentals and a mastery of techniques for developing products. There is also strong activity in medicine, which can lead to a greater development of research conducted in reproduction and neurobiology. Knowledge of plant molecular genetics and biochemical engineering has been strengthened, while consolidating some work in genetics, microbiology, new process technologies, and production of milk and dairy products. Research is usually conducted by small groups with just a few investigators, lacking critical mass for industrial projects.

In the agricultural area, the country has some potential advantages that could be further leveraged. One of these strengths is the seed industry, whose size seems to exceed the dimensions of the country. This potential could certainly be harnessed to increase the export of seeds, which at present is low. The country has a regulatory framework with potential for improvement, and a set of scientific experts composed of the best technicians from the Ministries of Livestock, Agriculture and Fisheries (MGAP), Public Health and the Environment. The regulatory structure has advanced in recent years, although some issues persist which impede the application and dissemination of knowledge.

The country has made a strong investment in the development of basic science, funded using credit issued by the IDB during the 1980s. It is estimated that this investment has produced a qualitative leap in the development of basic skills. The catalysts of this process28 feel that they are facing a historic opportunity, with the responsibility to demonstrate that the investment made during the past few years will have a positive and significant impact on the social and economic development of Uruguay. The stated goal is to achieve a sharp break with the country’s traditional lines of economic development, focusing on innovation in new fields, in particular biotechnology29.

Part 2
General introduction to biotechnology regulations

Chapter 1
Biosafety regulation

Introduction

Biotechnology represents an opportunity to address competitiveness in various productive sectors. Its development requires an appropriate legal and regulatory framework to provide guidance and support. The applications of biotechnology and the massive use of recombinant DNA techniques (rDNA), which generally contributes to achieving a better quality of life, have alerted researchers, government officials and entrepreneurs as to the importance of properly regulating the development and use of Genetically Modified Organisms (GMOs).

Biosafety encompasses the rules necessary to minimize the risks arising from the use of techniques and materials employed by biotechnology. These rules are indispensable to any biotechnology development policy. In addition to protecting the public and private interests, they are intended to facilitate trade and technology transfer, setting internationally accepted standards and practices that protect people, animals, plants and the environment.

The release of GMOs into the environment is an important topic when considering the business impact resulting from certain products developed by modern biotechnology. Dozens of plants and microorganisms and, recently, animals and procedures for gene therapy in humans are emerging outside the realm of research and development laboratories, thus requiring that methods and procedures be formulated which encourage technological advances while also ensuring their safety.

The development of GMOs in the laboratory does not present difficulties, and there are methods and procedures that ensure adequate safety of the operators and their surroundings. Large-scale production of GMOs usually takes place in well-isolated physical environments, where minimum safety conditions – or in some cases, high safety standards – are ensured. The codes of good production practices (GPPs) and good manufacturing practices (GMPs) in Europe or the United States are sufficiently explicit and forceful with regard to biosafety for people and the environment.

The most serious problem is environmental release of GMOs, where a significant increase is expected in the future, in areas including human health and plant health and production. Use of these GMOs on a large scale requires extreme caution and a careful risk assessment prior to release. There are manuals with very detailed procedures and guidelines from international bodies such as the United Nations, the Organization of American States (OAS), the World Organization for Animal Health (OIE), the Pan American Health Organization (PAHO), which propose the rapid adoption of mechanisms to ensure safety at the international and regional levels.

The experience of developed countries has shown that the use of standards and regulations by governments is vital for the proper functioning of a modern economy. Developing countries need mechanisms, procedures and qualified human resources to build an effective and self-sufficient regulatory framework. Any lack in this area can become a major impediment to the development of biotechnology and the application of biotech know-how in numerous industry sectors.

The key issues that are the subject of regulation include biosafety, which, from the point of view of biotechnology, includes provisions to reduce the risks of using techniques and materials applied to health, food, productive systems and the environment. These standards seek to protect public and private interests and to facilitate trade and technology transfer, by establishing internationally accepted standards and practices in these areas.

Regulations establish practices oriented towards decreasing the likelihood of incidents, by minimizing any damage caused. In order to ensure good control, it is necessary to have regulations based on risk assessment and risk management.

Doing a risk assessment consists in systematically collecting the available information about potential hazards in order to form an opinion about them; that is, to identify hazards and assess the dose-response relationship based on exposure. Risk assessment is often a theoretical exercise, although it is based on empirical data.

Risk management is the process of selecting the appropriate policy and regulatory action, integrating the results of risk assessment, with social, economic and political decisions. In 1977, Helen Marquard showed that, when analyzing the main steps of risk assessment, it was convenient to divide the process into stages: one which includes a prior description, strictly detailed, of the GMO itself, and the other describing the purpose of its release. The quality of any risk assessment depends on the degree of knowledge about what will be carried out, and the expected effects.

Once the description of the release of GMOs has been established, the first procedure is to identify the hazard, i.e., the situation which, in certain circumstances, could produce damage. In general, the following situations of risk may occur:

Ability to transfer genetic material;

Phenotypic and genetic instability;

Pathogenicity, toxicity and allergenicity

Potential for survival, establishment and spread;

Other negative effects on non-target organisms (which are not the target of genetic modification).

The mere identification of a particular characteristic of a GMO as a hazard does not imply a risk situation. The manifestation of this hazard will depend on the specific situation of release, that is, where and how it is done and on what scale. These aspects should be taken into account in order to identify and estimate the consequences of hazards. It is convenient to consider the consequences which each hazard may cause, directly or indirectly, in a short period, such as:

Dislocating or eradicating populations of organisms;

Modifying species population sizes or community composition;

Endangering species as a result of the release.

In the United Kingdom, Marquard indicates that the applicant requesting authorization must examine the magnitude of the consequences, classifying them as severe, moderate, low or negligible. The ability to carry out this analysis requires extensive knowledge of the species in the receiving environment, as well as possible effects on those species. The risk assessment also involves estimating the probability of hazards: with magnitudes high, moderate, low or negligible. Appropriate measures must also be adopted during and after the release; i.e., it is necessary to monitor the effects of the release in regard to its impact on the environment.

International agreements for regulating biosafety

Organization for Economic Cooperation and Development (OECD)

The OECD member countries distribute their biotechnology activities between the following groups: the Working Group for Harmonisation of Regulatory Oversight in Biotechnology and the Task Force for the Safety of Novel Foods and Feeds, tasked with developing harmonized regulations for biotechnology. The groups have developed consensus documents, which can be used as technical tools to assist in making regulatory decisions based on safety. The documents – focused on scientific methods of safety assessment – are common to all national agencies that regulate genetically improved plants.

To date, three documents have been published in the areas of biology of plant species (e.g., the environmental assessment of the plants) and general traits (e.g., resistance to viruses and insects and herbicide tolerance). Two documents are being prepared for specific crops of two plant species: rapeseed (canola) and soybeans.

The FAO’s International Undertaking on Plant Genetic Resources for Food and Agriculture

The FAO’s International Undertaking on Plant Genetic Resources for Food and Agriculture represents the first international effort regarding plant genetic resources for agriculture and food. Thus far, however, it has no legal status. It was approved by the FAO Conference in 1983 as an instrument for harmonizing activities related to access to plant genetic resources. Its goal is to “ensure that plant genetic resources of economic and/or social interest, particularly for agriculture, will be explored, preserved, evaluated and made available for plant breeding and scientific purposes.”

The Undertaking has been reviewed and readjusted several times, and in 1993, it was decided to draw up the Global Plan of Action for the Conservation and Sustainable Utilization of Plant Genetic Resources for Food and Agriculture, to identify the technical and financial needs to ensure the conservation and sustainable use of plant genetic resources. This Plan of Action was adopted by 150 countries in the Leipzig Declaration in 1996. It is expected that negotiations for the undertaking will soon be finalized, which will provide an important international instrument on issues regarding access to plant genetic resources and the distribution of benefits derived therefrom. This document will also serve as a basis for regulating the sustainable use of plant genetic resources in agriculture and food.

Codex Alimentarius

The Codex Alimentarius Commission is the United Nations’ highest authority on food safety standards. In 1989, the Commission decided to evaluate applications of biotechnology to the Codex’s existing system, instead of establishing a committee for this purpose. Currently, biotechnological issues are discussed in the Codex Committees and in the Committees on Food Labelling, on Residues of Veterinary Drugs in Food, on Food Additives and on Contaminants in Foods. Safety assessments are performed jointly by the Codex Committees and by Joint FAO/WHO Expert Committee on Food Additives (JECFA) and also by the Joint FAO/WHO Meeting on Pesticide Residues (JMPR). An Ad Hoc Intergovernmental Task Force on Foods Derived from Biotechnology, chaired by Japan, has been created in order to establish guidelines about the safety of foods derived from biotechnology.

Another priority issue considered by the Codex is labelling of foods derived from biotechnology. Progress is slow. A proposed draft entitled Recommendations for the Labelling of Food Obtained Through Biotechnology did not achieve consensus in 1998, leading to the creation of the Codex Committee on Food Labelling (CCFL) to follow up on examining the text.

Convention on Biological Diversity (CBD)

At the Earth Summit held in 1992 in Rio de Janeiro, the Convention on Biological Diversity (CBD) was opened for signature, which has among its objectives the conservation of the planet’s biodiversity. Early research in biotechnology has been generating a series of important advances in obtaining transgenic organisms, with significant results in global production of food and raw materials. These may, however, constitute a potential threat to ecosystems and genetic resources, if they are not used and managed with adequate, systematic and permanent controls.

This agreement has been ratified by more than 178 countries, although it has not signed by the United States. The objectives of the agreement are: “the conservation of biological diversity, the sustainable use of its components and the fair and equitable sharing of the benefits arising out of the utilization of genetic resources, including by appropriate access to genetic resources and by appropriate transfer of relevant technologies, taking into account all rights over those resources and to technologies, and by appropriate funding.”

Cartagena Protocol on Biosafety

The Protocol on Biosafety was set forth in Article 19, item 3, of the CBD, ratified by over 170 governments, out of the total of 188 UN member states. This article of the CBD states that “the Parties shall consider the need for and modalities of a protocol setting out appropriate procedures, including, in particular, advance informed agreement, in the field of the safe transfer, handling and use of any living modified organism resulting from biotechnology that may have adverse effect on the conservation and sustainable use of biological diversity.” The Protocol did not take into account the limited capacity of many countries, especially developing countries, to control the nature and magnitude of known and potential risks arising from GMOs.

After five years of negotiations, more than 130 countries adopted the Protocol in Montreal, Canada, at an event that took place between January 24-28, 2000. It was called the Cartagena Protocol on Biosafety in Biotechnology, named in recognition of the city in Columbia which was home of the first extraordinary meeting of the Conference of the Parties in 1999. Its specific objective was to ensure an adequate level of protection in the areas of safe transfer, handling and use of genetically modified organisms resulting from modern biotechnology (GMOs) which may have adverse effects on the conservation and sustainable use of biological diversity, also taking into consideration the risks to human health. The scope of its application is restricted to cross-border movements of GMOs.

The protocol was made available to states and regional economic integration organizations for signature at United Nations Office in Nairobi. It has been signed by over 100 governments and regional economic integration organizations. The Protocol will enter into force 90 days after ratification by the 50th party to the CBD. As of this writing, it had been ratified by more than 10 states. In Latin America and the Caribbean, the following countries have signed: Argentina, Chile, Colombia, Costa Rica, Cuba, Ecuador, El Salvador, Grenada, Haiti, Honduras, Jamaica, Mexico, Nicaragua, Panama, Paraguay, Peru, Trinidad and Tobago, Uruguay and Venezuela.

On November 24, 2003, Brazil filed its ratification of the Cartagena Protocol on Biosafety with the Secretariat-General of the UN. The Protocol, which at that time had the signature of 103 countries, has been in force since September 11, 2003. According to regulations, the Protocol entered into force internally in the country 90 days after the date of Brazil filing its ratification with the UN, i.e., on February 22, 200430.

Chapter 2
Key regulatory experiences on the international scene

Introduction

The purpose of regulatory framework for genetically modified organisms (GMOs) is to ensure balance between the protection of human health, the environment and biosafety issues in accordance with the needs consumers and industry, in a rational, scientific and efficient manner. If the general concepts are not accepted unanimously, then regulations would differ from country to country, which would tend to cause delays in business transactions as well as foreign exchange losses.

The introduction of plants modified by genetic engineering techniques induced changes in existing structures in Canada and the United States within the regulatory sphere, while in the European Union (EU), the changes were discussed and decided upon within the legislative sphere. These different treatments of the subject would result in different positions in the later discussion of these issues at international forums: the Cartagena Protocol on Biosafety, the Convention on Biological Diversity, the Codex Alimentarius, the International Organization for Standardization (ISO), the International Plant Protection Convention (IPPC), the WTO Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement), which, for example, gave rise to restrictions by the European market on the entry of GMOs into their territory.

Indeed, comparing the biosafety criteria between countries, there are fundamental differences in definitions – for example, in the definition of GMOs.

Canada (Directive 94-08) defines a GMO as a “plant with novel traits” (PNT): “a plant variety/genotype possessing characteristics that demonstrate neither familiarity nor substantial equivalence to those present in a distinct, stable population of a cultivated species of seed in Canada and that have been intentionally selected, created or introduced into a population of that species through a specific genetic change.”

This definition does not make direct reference to genetic engineering as a method of production, and therefore any specific genetic change (including plants obtained by conventional breeding, among other methods) satisfies the criterion used in Canada to define a PNT. Under the Canadian definition, biotechnology is “the application of science and engineering in the direct or indirect use of living organisms, or parts or products of living organisms, in their natural or modified forms.” This circumstance, which is unique to Canada, is not seen in the biosafety regulations in the US – where fact of the method used to obtain the new variety being via genetic engineering is a condition in order for the entire body of specific regulations to be applicable – nor in the European Union. In the case of the EU, for various reasons, including public perception, the method of obtaining new varieties of plants by recombinant DNA techniques is regarded as being at a different level of uniqueness, which is not considered in the case of the US, and thus the degree of precaution in the EU is higher, resulting in a much more restrictive regulation.

In the Canadian regulatory framework, the objects being regulated are denominated “plants with novel traits” (PNTs), while the regulatory frameworks of the US and EU make mention of “genetic engineering techniques” in their definitions of the objects being regulated. For clarity, this document will refer to GMOs in a way that includes both definitional criteria, that is, when referring to Canadian regulations the term GMO shall refer to products obtained by recombinant DNA technology – as done in the US and the EU – as well as products obtained by conventional breeding or other techniques not considered to be genetic engineering.

The conceptual differences regarding the objects to which the notion of biosafety is being applied, discussed above, cause impacts on the criteria of the regulatory framework. Nevertheless, the basic risk assessment criteria relating to environmental release and to food safety – in this case, with major differences in the EU – are similar, since they are based on the best available knowledge in science and technology. These basic criteria for assessing the risk of environmental release of a GMO, for preliminary assessment, include the following:

Possibility of GMO plants becoming invasive in agricultural and natural habitats. An “invasive plant” is taken to mean an unwanted plant species in an ecosystem managed by humans – “agricultural” ecosystems. A “natural” ecosystem is taken to mean one that is not managed by humans.

Possibility of gene migration to wild relatives whose hybrid offspring may acquire more pronounced invasive characteristics.

Possibility of becoming a GMO pest. A “pest” is taken to mean not only invasive plants but also those which produce toxic or allergenic substances or which parasitize other plants of agricultural interest.

Potential impact of the GMO or of the products of expression of introduced genes on non-target species, including humans.

Potential impact on biodiversity.

In the three cases analyzed, the framework governing biosafety was based from the outset on scientific and technical criteria. Although this continues to be a feature of the current regulations; there are perceptible differences between the countries’ positions in relation to the procedures applied, both in regards to authorization for experimental release into the environment, and in regards to authorization for marketing.

United States

In the US, the agency responsible for authorizing field trials of transgenic plants under controlled conditions, isolated from other plants that may be affected, and ensuring compliance with the conditions listed above, is the Animal and Plant Health Inspection Service (APHIS) of the Department of Agriculture (USDA). This agency defines the “regulated items” as regulated plants in the experimental phase, living organisms, especially plants and microorganisms, and products obtained or modified through genetic engineering which could potentially become plant pests or present risks to plants.

As can be seen, the main issues guiding the decisions of APHIS pertain to the potential risk of the plant becoming a pest. As part of its evaluation, the agency requires an applicant to do a trial release of the GMO in the field, in accordance with the following requirements:

Data on the properties of the plant and the environment in which will be introduced.

Assessment of the likely effects of the analyzed plant on the environment.

The analysis is performed on a case-by-case basis, taking into consideration factors including the following: the biology of the crop, the introduced traits, the environment in which it will be released, and the interaction of the plant with the environment.

Regarding the biology of the crop, the information required includes, for example, the form of reproduction, the type of pollination, and compatibility with wild relatives and/or related invasive plants. To give an idea of the level of detail required for evaluation, data is included for example on changes that could have been produced in the physical traits of pollen, such as weight, aroma, adhesion, etc.

Regarding the incorporated traits, the evaluation considers the donor organisms of introduced genes and the transformation method. Often some of the introduced genetic elements are derived from plant pathogens. It is important for these elements not to introduce unwanted traits in the genetically modified plant.

With respect to interactions with the environment, consideration is given to the possible flow of pollen to other individuals of the same species which have not been genetically modified, compatible wild relatives and/or related invasive plants which may be present, as well as the management practices of the crop in question. Familiarity and experience with these factors play a key role in assessments, providing a comparison between genetically modified plants and their unmodified counterparts. Thus, familiarity is an essential resource for the assessment of risks associated with GMOs.

An important conclusion to be drawn from applying the criteria described is that genetically modified plants can pose risks that are not unlike those presented by plants modified by classical plant breeding, derived from other genetic techniques which are considered “classic,” which have similar phenotypic traits and which are also grown in similar environments. This is a very different view from the one prevailing in the standards of the European Union, and is supported by groups opposed to GMOs.

In this respect it is interesting to observe the evolution of the standards applied to biosafety of GMOs in the US. The authorization requirements for trials, which were very complex in 1987, evolved in 1993 to become notification procedures, with further simplification of the requirements in 1997, when notification came to require compliance with a limited set of conditions or performance standards. This was the result of accumulated experience, which brought about a basic familiarity with GMOs: in 1988, more than 4,000 field trials had been conducted in more than 18,000 locations, authorized by APHIS. It is important to note that the simplification of procedures did not mean the relaxation of the risk assessment criteria. This can be confirmed by noting that an updated version soon became officially required for the data in applications for marketing authorization, referenced in the Molecular and Genetic Characterization in Environmental Risk Assessment. These documents show an extreme degree of rigor reflected in the large number of requirements drawn up in bilateral meetings of officials from the US and Canada, in order to validate, in both countries, the same request form.

This evolution in the procedures of the regulatory framework has been aided, no doubt, by a strong policy of promoting technology in these countries.

Growing familiarity had led to the realization that the risks of GMOs are not different from any other variety obtained by classical plant breeding, thus allowing the US regulatory framework to switch from a system with high information requirements (an authorization system) to a much simpler system, based on the applicant’s notification of their intention to conduct a trial (a notification system). The notification system, however, can only be used when certain conditions are met (Federal Register, vol. 62, No. 85, pg. 23,945 to 23,958), i.e., so-called performance standards. It is required that the regulatory agency have access to the trial, in writing, in the form of an “acknowledgment letter” and the ratification of the obligation to comply with the so-called performance standard, which remains subject to inspection and reporting of results. Since the notification system is limited to a certain number of crops and traits, the authorization to release arbitrary plants with arbitrary traits into the environment cannot be performed under such a system.

After several years of laboratory and field trials, the APHIS regulatory framework culminates with a determination of what is called “non-regulated status” which will mean a new botanical variety that does not pose significant risk to other plants of the environment and which can be used with the same safety as traditional varieties. This determination allows the new plant to be grown, tested or used to obtain harvest without any additional intervention from USDA-APHIS. Both the petition and the accompanying environmental assessment prepared by USDA-APHIS are published and made available for public comment. A deadline is set for the submission of objections, which are publicly addressed in the document communicating the decision to grant non-regulated status.

The marketing of a GMO also requires the intervention of two regulatory agencies: the Food and Drug Administration (FDA), which regulates the use of GMO food, and the Environmental Protection Agency (EPA), which authorizes the use of GMOs in which certain traits of pesticides have been incorporated, such as insect resistance or herbicide tolerance.

Canada

As discussed earlier, the Canadian regulatory framework encompasses plants with novel traits (PNTs), with this category including not only plants derived from recombinant DNA technology but also plants obtained by traditional plant breeding or techniques other than those mentioned. The Canadian regulatory agency for PNTs is the Canadian Food Inspection Agency (CFIA), which adopts as its regulatory criterion the idea that PNTs may have traits which could cause adverse effects – due to the presence of these traits in a particular species of plant and the way the plant is used. Some of these traits may be considered unfamiliar when compared with products already on the market, or may not be substantially equivalent to the types of similar familiar plants already used and considered safe.

As in the cases analyzed, Canada has established information requirements that must be considered in environmental risk assessment of PNTs to ensure appropriate biosafety, in the absence of conditions of confinement.

Canada defines a “confined field trial” as a trial performed in conditions of isolation, including reproductive isolation, inspection of the site and restrictions on future use of the land. Under these circumstances, trials are allowed for studying traits, such rate of pollen escape in species having that capability, invasive characteristics, persistence in the environment, impacts on other species, and other studies, all clearly associated with obtaining data for environmental risk assessment resulting from release (hence the “confined” classification).

Meanwhile, a “field trial” is defined as a trial involving:

A plant species modified for the purpose of acquiring a specific trait or transformed into a specific genetic construct.

A specific place, with a specific purpose.

A request from a specific applicant.

A specific period.

It is particularly convenient to define the concept of “substantial equivalence,” a term widely used in the definition of PNTs. Substantial equivalence pertains to a new trait within a particular species of plant in terms of its specific use and its safety for the environment and for humans, compared to the same species that is already in use and is generally considered safe, with this comparison being based on valid scientific criteria. The Canadian definition allows a literal interpretation; i.e., a categorical statement as to whether two plants are or are not substantially equivalent. Other forums (such as the Codex Alimentarius, with criteria shared by the European Union) consider “substantial equivalence” as a guide for deciding on which analytical determinations and parameters should be studied in a GMO to evaluate its safety, compared to its non-genetically modified counterpart .

Canada calls “unconfined release” the use of a PNT under conditions not subject to reproductive or physical isolation of the natural environment or of the agroecosystem, nor inspections or post-harvest land use restrictions and/or restrictions on use of seed and progeny. To obtain the authorization for commercial use of the seed for food, involvement by another regulatory agency is required: Canada’s department of health (Health Canada), which assesses the suitability for human consumption. Meanwhile, the CFIA assesses suitability of food and biological products for animal use.

As stated, the information requirements for risk assessment have recently been standardized by the CFIA and APHIS, and involve a complete set of data. In fact, the standards of the US and Canada began to be harmonized in 1998. To date, this harmonization has resulted in the development of two regulatory documents, one for the data required to characterize the molecular genetics of the GMO, and the other with the necessary data for risk assessment of environmental releases. Both documents will be adopted by those countries, so that a single application is required for authorization of environmental release. Both countries have the intention to propose these documents for discussion in other forums, as models for other countries and international organizations.

European Union

The European Union (EU) began to regulate GMOs in 1990. The first Directive (90/220/EEC) was implemented in the period 1992-1995 in all member states. In 2000, members voted on a series of modifications, which resulted in a new Directive (2001/18/EC) from the European Parliament which entered into force on October 17, 2002. The original regulations were based on “process” (the method by which GMO is obtained, that is, by recombinant DNA technology), in contrast with the laws of the United States and Canada, which are based on the “product” (a genetically engineered plant in the US; or a PNT according to the Canadian nomenclature).

The new European standards are more specific, since, when defining GMOs, they do not include mutagenesis and cell fusion among the techniques considered for the regulated articles. Note that these techniques do define a PNT under Canadian standards.

The European standards distinguish between release for commercial and non-commercial purposes. For the first case, the party applying for release authorization must file a notification, which includes a technical report with the information necessary to carry out risk assessment for the environment, as well as their own risk assessment. The competent authority shall approve or reject the notification within 90 days after submission. A distinctive feature of European legislation is the existence of mechanisms for public consultation. In the case of release for commercial purposes, the notification must include:

Information about the consequences of the release to human health and the environment.

Assessment of risk to the environment.

Conditions for commercializing the product, including specific conditions of use and management.

Proposed duration of the authorization, not to exceed 10 years.

A continuity plan, including a proposal on its duration, which may be distinct from the proposed duration of the authorization.

Proposed labelling which must meet the requirements set forth in Annex 4 of Directive 2001/18/EC. This Annex describes in general terms the additional information necessary for the marketing application. The labelling must clearly indicate the presence of GMOs. The label or attached documentation must contain the phrase: This product contains GMOs.

Proposed packaging.

Summary of product characteristics.

From this information, it is possible to deduce that labelling is an important issue in European law, although within the regulatory framework of Canada and the USA it is not. In the context of labelling, for example, the European Union requires information on at least the following characteristics:

Expected use of GMOs, highlighting the differences in use or management of the similar, non-genetically modified product.

Description of geographic areas which are expected to use the product, including, where possible, estimated scale of use.

Steps to be taken in case of unintended release or misuse.

Specific instructions or recommendations for storage and handling.

Information about any adverse effects.

Proposals for restrictions on use, for example, where it can be used and for what purposes.

In cases where it is impossible to exclude the accidental or technically unavoidable presence of traces of GMOs authorized for commercial sale in other products derived from non-GMO raw materials, a threshold value will be established below which such products need not indicate the presence of GMOs on the label.

It may be inferred from these standards that, given the complexity of systems for storing, distributing and processing raw food, the mention of GMO content in food labels will be widespread in the European Union.

For various reasons, the regulatory approach adopted in Europe probably exaggerates its precautionary character. Although this does not imply that the standards of the US and Canada are neglectful or permissive – which they in no way are – it is possible to perceive an overly strict interpretation and undue caution in the European regulations. This is reflected, for example, in various parts of the text of the new Directive, transcribed below:

“... living organisms released into the environment in quantities large or small ... can (affect) ... other member states; the effects of such releases into the environment may be irreversible.”

These statements ignore at least the concept of agroecosystem, in which GMOs are usually cultivated.

“... an assessment of risk to the environment should be made ... such assessment should take into account the potential cumulative effects associated with long-term interaction with other GMOs and the environment.”

This statement does not take into consideration the fact that a risk assessment is precisely the element most appropriate for estimating possible long-term effects.

It is also possible to observe a significant difference in applying the precautionary principle with regard to the presence of antibiotic resistance genes present in GMOs. It is known that there is a low probability of an antibiotic resistance gene to be horizontally transferred from one plant to an organism, either in the soil, or in the gastrointestinal tract of mammals. As verified experimentally, this is based on the many barriers that the plant’s DNA must go through in order to finally be integrated and expressed in a microorganism. Moreover, officials from the Commission for the Environment in the EU indicated there is no scientific evidence that all GMOs containing antibiotic resistance genes have adverse effects on human health and the environment, suggesting that risk analysis should continue to be done on a case-by-case basis. Nevertheless, the standard establishes a deadline (2005) for exclusion from the market of products containing GMOs with antibiotic resistance genes.

In contrast to the European position, it is interesting to note that in 1998 the FDA produced a document on the subject called Guidance for Industry: Guide to Minimize Microbial Food Safety Hazards for Fresh Fruits and Vegetables. The document stated that: “the FDA acknowledges that the likelihood of transfer of an antibiotic resistance marker from plants to microorganisms in the gut or in the environment is remote and that, such transfer, if any, would likely be insignificant when compared to transfer between microorganisms, and in most cases, would not add to existing levels of resistance in bacterial populations in any meaningful way.” Despite the foregoing, the paper suggests that those involved in the development of GMOs should assess, with discretion and on a case-by-case basis, the use of marker genes for antibiotic resistance, by evaluating the following conditions: (1) whether it is an important medication; (2) whether it is frequently used; (3) whether it is administered orally; (4) whether it is unique; i.e., whether it is the only option for certain diseases; (5) whether there is a selective pressure that favors transformation, such as transfer of DNA to the inside of the organism and its expression; and (6) what level of antibiotic resistance is already present in the bacterial population.

This comparison is also an example of the features which have affected the regulatory frameworks for GMOs: (1) the different conceptions of the precautionary approach; and (2) the impact of public perception.

Chapter 3
Farmer’s rights

Farmers interested in introducing genetically modified crops have had to adapt to existing legislation pertaining to farmers’ rights. In this context, the relevant instruments are the Acts known as the International Convention for the Protection of New Varieties of Plants established by the International Union for the Protection of New Varieties of Plants (UPOV), drawn up in 1961 and revised in 1972, 1978 and 1991, in which the so-called “farmer’s privilege” appears implicitly. Under this agreement, the breeder must give prior authorization for production for commercial purposes, while also taking into consideration, however, that if the production of propagating material is not made for commercial purposes, then it is excluded from the scope of applicability of breeder’s rights. Therefore, if the seed is produced by the farmer for his own use and not for the purpose of being sold to third parties, it does not infringe on breeder’s rights. This is called the “farmer’s privilege or exception,” which is an exception to the exclusive rights of the breeder.

The topic concerning the farmer’s privilege was modified for several reasons, including assessing the development of new technologies and the costs of innovation, at the time of the Convention’s revision in 1991. The revision expanded breeder’s rights from “commercial production” to “all types of production.” However, given the great diversity of situations in UPOV member countries, such an obligation, requiring seeds intended for one’s own use to be submitted to the breeder for authorization, would have made it virtually impossible to be implemented by many states.

Thus, in order to get the widest possible consensus and the minimum acceptable level which would allow the accession of a large number of countries, the UPOV Convention accepted the possibility that each country could adapt its legislation to the national reality. Some countries, such as France, have chosen not to allow the “farmer’s privilege,” while in the Act of 1991, the exception remains within reasonable limits, always safeguarding the legitimate interests of the breeder.

In practice, the countries that have ratified the Act of 1991 were only able to do so by adapting it to national circumstances, while a large number of countries signatory to the Act of 1972 included provisions in their legislation which tend to strengthen the protection of breeder’s rights.

In the case of the US, for the varieties protected in titles of protection obtained prior to April 5, 1995, farmers could save seeds for future planting, with the condition that they not sell the seeds. Meanwhile, seeds of varieties protected after this time period could only be saved for planting on the same farm; that is, they could not be sold as propagating material without the authorization of the breeder. The seed industry grants such authorization only in specific situations such as emergencies and bankruptcies, among others. In that country, the Supreme Court established jurisdiction over the amount of seed to be saved, which states that a farmer can save the amount necessary to replant, and can sell it to third parties, provided that he retains some amount to actually be used in replanting.

It should be noted that this legislation considers the farmer’s privilege as an exception clause to an infraction, and not as a positive right. Therefore, in cases where a farmer who is obligated under contract not to save or reuse the seeds ends up dishonoring this obligation, it will constitute only a breach of contract and not a violation of breeder’s rights or the waiver of a right.

Canadian law recognizes similarly the farmer’s privilege as was the case in the US before April 5, 1995.

The situation in the EU is more complex because of its multinational nature. The majority of member states have protection regimes that are not harmonized at the Community level, but are subjected to the internal law of each state. Given this situation, in 1994 the EU Council adopted a regulation, amended in 1995, which creates, in addition to provisions at the national level, provisions at the Community level which are applicable to those plant varieties which have been granted titles of protection valid at the Community level. Thus, the Community system does not affect the rights of member states. While Community legislation is in line with the UPOV Act of 1991, several member states have not ratified it.

The EU Community standards allow farmers to use the product of their harvest for planting, under certain conditions, describing these as a restriction which is in the public interest. In its paragraphs, it adopts the phrase “farmer’s privilege” and applies it to certain species, on the condition that farmers who are not considered “small” – in accordance with Community regulations regarding size – be required to pay a fair remuneration to the breeder. Following this criterion, some EU countries have set limits on the farmer’s privilege, based on the volume of production or on the area being commercially exploited. As a counterpart to this protection, monitoring of compliance with the provisions relating to these rights is the responsibility of the rights holder.

Chapter 4
Regional situation

In developed countries, companies are fully aware of regulatory matters, and use them as strategic input for management. In the biotechnology field, leading companies have a broad knowledge of biosafety standards and strictly comply with them, using formal structures for their enforcement. Compliance with quality and environmental protection standards, for example, is often used to support marketing and business reputation.

Countries and companies with regulatory frameworks have predominantly adopted, with adjustments, the models used in the United States by the United States Department of Agriculture (USDA) and Animal and Plant Health Inspection Service (APHIS) for plants, by the Food and Drug Administration (FDA) for biopharmaceuticals, and by the Centers for Disease Control and Prevention (CDC) and the National Institutes of Health (NIH) for research and development.

In developing countries, there are few specific regulatory bodies or up-to-date biosafety standards administered by government agencies concerned with research, development, pre-commercial trials, industrial-scale production and marketing of products derived from modern biotechnology.

During the past decade, some countries in Latin America have begun to incorporate measures to address the issue of biosafety, with emphasis on regulating the environmental release of transgenic organisms. In Argentina, the productive sector is incorporating regulations by enforcing them at different levels of their activities. The most dynamic companies interact with the public sector to develop and improve the regulatory framework and monitor its implementation.

The Argentine government is discussing, as a top priority, issues arising from environmental release of genetically modified organisms (GMOs), in the areas of agriculture and human health, having created the National Advisory Commission on Agricultural Biotechnology (CONABIA) [Comisión Nacional Asesora de Biotecnología Agropecuaria] and the National Commission on Biotechnology and Health (CONBYSA) [Comisión Nacional de Biotecnología y Salud]. These two commissions have advisory functions and are composed of representatives from government, research institutions and private companies in the biotechnology field, developing a comprehensive and effective program of work.

Chapter 5
Regulation of intellectual property in biotechnology

Ownership of innovations31

Legal systems of protection of intellectual property, using patents, grant a temporary legal monopoly, which is a stimulus for innovation. They have two goals: ensuring the inventor the ownership of their idea and the economic benefits arising therefrom, and allowing society to benefit from the invention in exchange for a fee to use it. However, the protection afforded to the patent is sometimes partial, and, therefore, companies do not consider it to be an effective method. In this case, the focus is on secrecy and the speed with which the product is brought to market, and on stimulating the learning process on the part of staff at an innovative company.

As soon as the innovation is patented and distributed, once it is applied by other companies which have bought the rights, an increase in productivity is achieved, reducing production costs and indirectly generating surpluses for the entire production system. In turn, this knowledge can also be appropriated by other firms, by the mobility of workers from one company to another, by reviewing the professional literature, by copying, by re-engineering and by industrial espionage.

Empirical studies by several authors (NEFFA, 2000) have concluded that the patenting of innovations is not effective to defend intellectual property and encourage its dissemination. For the innovator, it is preferable to accumulate production experience, keeping the trade secret, thus ensuring a considerable period of competitive advantages over competitors. Patenting is not always an incentive for innovators, since there are market imperfections such as uncertainty and risk due to information leaks.

Intellectual property

Intellectual property is a means of securing ownership of innovative results. It provides a legal mechanism to prevent the use of protected material by unauthorized third parties. Securing the ownership of innovative results can occur through a variety of methods, whose relevance and effectiveness differ according to the productive sectors involved, which may or may not have to do with innovations in processes or products. In general, it is more effective for products, since process protection is not usually used to prevent alternative processes which achieve the same result (NEFFA, 2000).

Intellectual property is expressed by legal rules, as part of public law, which focuses on various aspects of creation and use of technology, and on distinctive symbols, depending on whether goods and/or services are involved. Intellectual property refers to intangible assets, but its effects extend to tangible goods or services that embody them.

Copyright

“Scientific works” may include research reports, didactic works, models, and other works which are not categorized as art or fiction. But procedures or scientific methods, or scientific discoveries, are not considered as such. As a general principle, the protection provided does not cover ideas, methods, etc., contained in a work, but rather the way in which these are expressed. A “scientific work” does not deserve protection due to the scientific character of its contents, but rather due to the way in which it expresses this, in written or graphic form.

Finally it should be remembered that the publication of a work protected by copyright may inhibit the use of technical ideas contained therein for the purpose of protecting an invention via a patent application. Ignorance of this rule is often a source of great frustration for researchers. In some European and American universities, mechanisms have been established to prevent the disclosure information which could negate the absolute novelty required for patent applications.

Industrial secrets

This consists of all information which has industrial application and which is confidential in nature, which enables obtaining or maintaining a comparative advantage or cost advantage in relation to others in performing economic activities which use means or systems sufficient to preserve its confidentiality and restrict access to it32. When the secret is communicated to an employee, this must be done in the form of an explicit warning of its confidential nature; that is, it must appear with a special clause in the contract. The information which is subject to confidentiality must be anchored in a physical medium.

Parallel to the patent system, a concept has developed which is nowadays called know-how. On the theoretical side, know-how and confidential information correspond to the concepts of trade secrets, and can be defined as “unpatented technical knowledge, for which due precaution has been taken not to divulge it.” Unpatented technical knowledge is a mechanism by which certain technical information may appear in the margins of public knowledge. When reserved for the owner of the invention and put into practice along with the patent, it thus gains greater value.

While patent law is a property right, secrecy is not considered a property right under Continental (European) law, as conceived under Anglo-Saxon law. This theme has been the subject of intense debate, arising from conflicting interests on the matter, following the spectacular development of the application of trade secret protection as a methodology in the technology field, to the point where experts certify that core technology is covered by industrial secrecy and not by patent. Therefore, the decision to maintain secrecy, especially at the research development stage, has become a common practice. Simultaneously, a strong increase in industrial espionage has developed, encouraging debate about ways to protect industrial secrets.

At the Uruguay Round of GATT negotiations, protection of confidential information was included. At that meeting, TRIPS (Trade Related Aspects of Intellectual Property Rights) was added as an item on the agenda, regarding intellectual property rights applied to industry and commerce. Intellectual property rights have traditionally been the responsibility of the World Intellectual Property Organization (WIPO). However, developed countries have chosen to discuss international law under the GATT, considering that this international body can enforce sanctions against members who do not meet the agreed standards, something which does not occur within the framework of WIPO.

The topics which have been incorporated into the competence of the GATT are: patent law, trademarks, industrial designs, software and integrated circuits. In 1990, at the request of the United States, the “protection of confidential information” was included. The intention was to interpret this information as a property right. However, the other countries, particularly members of the European Union, argued that trade secret protection was based on unfair competition, and this argument won. The GATT, through TRIPS, then established a specific type of essentially international rules, which will be extended to countries that join, for a period not exceeding 10 years.

Other means of securing ownership

Securing ownership of innovative results can also be achieved through other mechanisms that affect the entry and performance of potential competitors, such as lead time, learning and improving technology, as well as systems of sales and publicity (NEFFA, 2000). Lead time is the amount of advantage that the innovator has in relation to others when introducing a new product or process. It is important both in high-tech industries and in consumer products, where product differentiation plays an important role.

Learning and improving one’s own technology performed by the innovator itself can also provide an advantage over the competitors; i.e., the innovator can offer new products. This means of securing ownership is particularly important in sectors where accumulated and tacit knowledge is important, such as occurs in the area of biotechnology. The system of sales and customer service is also a way to maintain a captive customer base and avoid the proliferation of imitators. This method is significant in areas of high, medium and low technology.

Standardization is another activity that contributes to the diffusion of innovations (NEFFA, 2000). The definition and establishment of technical standards helps to reduce uncertainty, broaden the market, lower unit costs, increase economies of scale and productivity and appropriately meet the needs of customers and users. Standards allow setting the boundaries of technological trajectories, contribute to homogenizing the product components and make products from different brands compatible, facilitating learning and improving maintenance and repairs. The establishment of a new product typically includes the participation of industry, consumers or users, experimentation and trials made in the scientific, technological and university realms and public sector involvement in the search for consensus to codify it. When a standard is adopted by manufacturers, this reduces the field of possibilities for innovation and delimits the scope of competition. In view of the speed of scientific and technological changes, standards should be reviewed periodically.

Users and consumers benefit from the adoption of appropriate standards, but this is not equally true for everyone. Some may not meet the standards and will be at a disadvantage, while others might be able to impose their standards on the country. Thus, barriers to entry and permanence are generated, sometimes driven by requirements arising from adapting to standards imposed by international trade. The increasing importance of ISO standards plays a decisive role for the ability of goods from developing countries to access the markets of industrialized countries.

Chapter 6
Protection of biotechnological innovations on the international scene

Introduction

The international marketing of modern biotechnology products has occurred at a much faster pace than the improvement of regulatory systems ensuring the benefits of biotechnology for the public and the safety of GMOs for human and animal health and for plants and the environment. These facts have resulted in barriers to trade for these products. In Europe, scientifically unsubstantiated concerns have politicized and practically paralyzed the approval process, thus hindering the trade of biotechnology products.

United Nations Biodiversity Conference

The Conference was opened for signature in June 1992 and the UN Convention on Biodiversity entered into force in December 1993, and had been ratified by 157 countries by August 1996. It proposed conservation of biological diversity, sustainable use of genetic resources and fair and free distribution of benefits from their use. In the past, genetic resources had been declared to be a common heritage of mankind. Article 15 recognizes the sovereign rights of states over their natural resources, their authority to determine access to them and the need for such access to be subject to prior informed consent. In exchange for providing access to their genetic resources, a donor country shall benefit by any of these three mechanisms: participation in research – Article 15(6); participation in the research results and benefits from commercial exploitation – Article 15(7); and access to and transfer of technology derived – Article 16(1). The Convention recognizes the legitimate role of intellectual property in achieving these goals.

The approval of the Cartagena Protocol on Biosafety under the Convention on Biological Diversity, which regulates the movement of agriculture-related GMOs across borders, implies the adoption of new regulations at the international level, along with advances in the regulatory environment in Europe. The ratification process is relatively slow, and apparently will not have an immediate impact on international trade in GMOs.

Convention of the World Intellectual Property Organization (WIPO)

The Paris Convention for the Protection of Industrial Property of 1883, revised on several occasions, applies to patents, trademarks, geographical indications, industrial designs and unfair competition. Among other provisions, it includes a right of priority, where a patent applicant may apply for a patent in one country and then, within one year, apply in other countries of the Paris Union, and these later applications will be regarded as if they had been filed on the same date as the first application.

International Union for the Protection of New Varieties of Plants (UPOV)

The International Union for the Protection of New Varieties of Plants (UPOV) sets minimum standards for the protection of vegetable varieties through “breeder’s rights.” It is an international union of countries with common or similar systems regarding breeder’s rights. There is a version of the agreement from 1978 (UPOV 78) and another from 1991 (UPOV 91), as explained in Table 2. Argentina has acceded to UPOV 78.

The Act of 1978 includes a breeder’s exemption, which allows using a protected variety to create a new variety. This addition was intended to allow new varieties by natural cross-breeding, performing the selection using the traditional system of cultivation. With the application of genetic engineering, biotechnology companies could take ownership of many existing plant varieties, by adding a gene that confers resistance to diseases, pests, and herbicides, etc., which could undermine much of traditional cross-breeding technology. UPOV has analyzed this situation, and the Convention of 1991 formulated a new concept, called the essentially derived variety.

The conditions for the protection of a new variety are the same under both the 1978 and 1991 Acts: it must be distinct, uniform and stable. Otherwise, it is considered an “essentially derived variety”, when most of the traits of the new variety are the same as the previous variety, which is called the “initial variety.” A variety may be deemed to be “essentially derived” (thus requiring prior authorization from the breeder of the initial variety) if it maintains most of the genetic traits and has only a small addition made by biotechnology techniques, or by classical techniques such as by selection of a natural mutant or by backcrossing. The concept of “essentially derived variety” aims to simultaneously discourage outright copying while encouraging innovation in plant breeding.

Table 2. Major differences between the UPOV 78 and UPOV 91 systems.

Use of propagating material which requires prior authorization of the breeder

UPOV 78 (Art. 5(i))

UPOV 91 (Art. 14(i))

Production for commercial purposes

Production or reproduction (multiplication)

Preparation for the purpose of propagation

Offer for sale

Offer for sale

Commercial sale

Sale or other type of marketing

Export / import

Storage for any purpose mentioned

Extension of protection to harvest products

UPOV 78 (Art. 5(4))

UPOV 91 (Art. 14(2))

Optional

Yes, when they are not obtained by the unauthorized use of propagating material and when the breeder does not have the opportunity to exercise its rights in relation to the propagating material

Protection of essentially derived varieties

UPOV 78

UPOV 91

No

Yes: Art. 14

Duration of protection

UPOV 78

UPOV 91

18 years for trees and vines

25 years for trees and vines

15 years for other species

20 years for other species

Source: Wendt and Izquierdo (2000).

World Trade Organization (WTO) agreements33

The TRIPS Agreement (on Trade-Related Aspects of Intellectual Property Rights) is Annex 1C of the agreement establishing the World Trade Organization34. Under this agreement, any country that ratifies the GATT accepts the obligation to establish minimum standards of intellectual property in technology fields, except where exploitation of the invention interferes with public order, human animal or plant health, or to avoid serious damage to the environment. The TRIPS Agreement, while allowing members exclusions from patentability, suggests providing protection to plant varieties either by patents, by an effective sui generis system, or by a combination thereof35.

The TRIPS is the most far-reaching international instrument on intellectual property rights. It sets minimum standards for patents, copyrights, trademarks and trade names, industrial designs, geographical indications, integrated circuits and trade secrets. It incorporates additional obligations to the Paris, Berne, Rome and Washington Conventions in their respective fields, and harmonizes intellectual property rights standards, while leaving a margin of maneuver at the national level. The agreement introduced new regulations: patentability, especially of pharmaceuticals and biotechnology products and processes; elimination or limitation of requirements regarding local exploitation of inventions; extension of terms of protection; more precise definitions of the exclusive rights granted; and strengthening of mechanisms to ensure the observance of rights and penalties for violations (CORREA, 1996).

WTO members may exclude from the patent regime plants and animals other than microorganisms, as well as essentially biological processes for the production of plants or animals that do not constitute biological or microbiological processes. Members must take the necessary measures for the protection of plant varieties through patents, an effective sui generis system or by a combination thereof. This provision must be reviewed every four years after the World Trade Organization Agreement went into effect.

This exception reflects the unresolved differences between the industrialized countries about the patenting of plants and animals. In the absence of distinction, the exclusion involves, in general terms, actual animals and plants, animal breeds and species of plants and animals. The standards allow excluding traditional plant breeding procedures from protection, without affecting the possibility of obtaining protection, for example, for developments based on cell manipulation or by gene transfer (CORREA, 1996).

The minimum standards for protection of almost all aspects of intellectual property of the TRIPS Agreement must be instrumented by means of national laws, with a transitional period of 5 years for developing countries. Pharmaceutical and agrochemical products have a longer deadline, which extends from 10 to 11 years for less developed countries. Once the period of transition has expired, the agreement is binding and any dispute must be resolved through multilateral dispute resolution mechanisms.

The instrumentation of the provisions of TRIPS may be determined in accordance with the practice and the legal system of each country. Breeder’s rights and utility models fall outside the rules of this agreement. The UPOV Convention is the only international instrument which sets minimum standards of protection.

Article 27.3(b) of TRIPS requires that countries have the capacity to exclude from the patentability regime, plants and animals and essentially biological processes for the production of plants or animals other than non-biological and microbiological processes. Despite this, members must take all measures necessary to protect plant varieties through patents, an effective sui generis system or by a combination of both options (CORREA, 1996).

Under Article 27.3(b), the difference between European law and that of other countries which share this approach refers to “plants and animals” and not “varieties,” “races” or “species.” The distinction is important, because the prohibition of patenting a “variety” does not prevent, in European countries, a plant from being patented as such. “In the absence of any distinction, and as set forth in the second paragraph of the article presenting an exception to a particular classification (plant varieties), the exclusion should be interpreted to involve, in general, actual animals and plants, breeds of animals and species of plants and animals” (CORREA, 1996).

The mention of “essentially biological processes” (CORREA, 1996) is limited by the exclusion of “biological and microbiological” processes. The introduction of this concept makes it possible to exclude protection of traditional plant breeding procedures without affecting the possibility of obtaining protection for developments based on micropropagation or gene transfer. In most countries, it is possible to patent processes in which microorganisms are used, such as fermentation processes. The concept of “non-biological process” is more novel and complex. The origin and bases of this are unknown, and it is likely to cause more problems than it seeks to solve.

Trends in industrialized countries36

In industrialized countries, there is considerable agreement, though not unanimous, regarding the protection of biotechnology inventions through intellectual property rights. One accepted principle is that it is not possible to deny protection to an invention by the simple fact of its using or being composed of living matter. This understanding was taken from the decision of the Supreme Court of the United States in case of Diamond v. Chakrabarty, which ruled that genetically modified bacteria could be patented. Biotechnology patenting has expanded in three directions: substances extracted, isolated and purified from nature; subcellular particles (genes, plasmids, etc.); and more complex transgenic organisms, plants and animals (CORREA, 1998).

The TRIPS Agreement, in turn, encouraged more flexibility: countries may or may not grant patents to substances existing in nature and are not obliged to grant patents on plants and animals. The trend in industrialized countries is towards expansive patenting. The European Union is close to the US position, while maintaining the criterion of non-patentability of plant varieties. In other developed countries and also in Latin America, there are important differences in relation to the model adopted by industrialized countries.

The types of problems encountered have turned biotechnology into a highly contentious field. There are probably few areas in the field of patent law where disputes are so numerous, significant and costly. There is hardly a major biotechnology patent that has not been the subject of an administrative proceeding or hearing before the courts, by a competitor or third parties. The more important a biotechnology development is, the greater the possibility that the patent in question will be the subject of challenges by third parties37.

One of the potential limitations to the patenting of living matter is the difficulty of describing the material in order to satisfy disclosure and reproduction requirements. The deposit of materials related to the patent is the mechanism established to overcome the impossibility of describing biotechnology inventions, replacing the written description with access to deposited strains. The Budapest Treaty establishes the conditions for the deposit and maintenance of strains, but does not provide the option for the International Depositary Authority (IDA) to verify whether the microorganism being claimed corresponds strictly to the material deposited. The Treaty defers to national legislation to determine the conditions for access to samples deposited; i.e., it is up to the laws of each country to decide when and under what circumstances the samples may be obtained (CORREA, 1996).

Instruments for the Protection of Intellectual Property in Biotechnology

Intellectual property in the field of biotechnology can be protected by patent systems and breeder’s rights. Breeders’ rights are an exclusive title for the exploitation of a plant. They protect the propagating material of a plant, that is, the seed. The requirements are: differentiation, homogeneity, stability and commercial novelty. The scope of protection is the production of material for commercial purposes, and the goal of protection is to prevent propagation by reproductive or vegetative methods.

Patents are a legal privilege granted by the state to a person or legal entity to exclusively exploit an invention for a certain period. The requirements of a patent are novelty, nonobviousness and utility.

Patent regimes and breeder’s rights protect plant materials, in different ways and to differing degrees. With the spread of GE crops, the interrelationship between these rights is gaining importance. The main differences between the object and scope of protection conferred by patents and breeder’s rights are:

Material to be protected: Under the regime of breeder’s rights, the material to be protected is a plant variety (or a cultivar), i.e., a type of plant within a cultivated species that is distinguished by one or more traits. Breeder’s rights are conferred in a specific way to plant varieties. The protection applies to the propagating material of a variety; i.e., those rights do not protect parts of plants, or particular genes, but the whole genome of a variety. They protect a population of plants which is uniform and stable, and which is distinct from other varieties already available by at least one important trait.

Protection requirements: The patent regime requires novelty, inventive step (non-obviousness) and capability of industrial application, while the plant variety protection regime requires novelty, distinctness, uniformity and stability. The patent system is based on universal (worldwide) novelty, while in the plant variety system, novelty requires only that the variety not have been sold or offered for sale for more than one year, with the consent of the owner in the country where protection is being applied for, or in any other country for more than four years, or for 6 years in the case of vines and forest trees, fruit trees and ornamental trees.

Embodiment: Under the UPOV regime, a variety is protected only when it physically exists, while under the patent regime, it is not necessary that the invention be embodied – it is sufficient that it be realizable, in accordance with the relevant description, by a person having ordinary skill in the art.

Exceptions to exclusive rights: The “breeder’s exemption” is one of the key differences between the system of breeders’ right and the patent system, allowing the use of a protected variety as a source for further development, which, once achieved, can generate an independent protection. This exemption applies when the material is subject to a registered property right, because in the absence of protection, there is no exclusive right which may be imposed on a third party. In the production of hybrids, for example, is common to keep parental lines a secret, but such protection does not confer any exclusive right, but only the right to take action against commercially dishonest acts, within the framework of unfair competition.

Duration: Patent rights expire 20 years after the application is filed, while breeder’s rights protection can extend to 25 years depending on the species.

Territoriality: Patent rights and breeder’s rights do not involve absolute ownership, in the sense that they can only be exercised in the countries where the respective title has been granted. In countries where the no claim has been registered, there is no protection, and thus the innovations are in the public domain.

Overlap: With the development of transgenic varieties, it is possible that, in relation to the same variety, there may be an overlap between a claim for breeder’s rights directed to the plant variety itself, and a claim for patent rights directed to a gene or genetic construct incorporated therein. Such claims may belong to the same or different holders; in the latter case, contractual arrangements are needed to establish the rights of each party. Since a patent prohibits the use of the material as a source of germplasm, such overlap may neutralize the “breeder’s exemption,” unless the gene or gene construction in question is not expressed in the new variety developed.

Chapter 7
Biotechnology patents in the European Union

European Union Directive38

In July 1998, the European Union adopted Directive 98/44/EC on the legal protection of biotechnological inventions. Although the European Patent Organisation (EPOrg) has no formal obligation to enforce this Directive, this procedure was considered necessary to ensure the uniformity of the harmonized European legislation on this subject. Thus, this intricately worded Directive has been enforced by incorporating its essence into the Implementing Regulations of the European Patent Office (EPO). These Regulations must be complied with by the EPO, its boards of appeal and courts of the Contracting States. Since the new regulations came into force on September 1, 1999, the EPO has returned to granting patents for claims directed to transgenic plants and animals per se.

The question of patentability of transgenic plants and animals has been a sensitive issue for the EPO in recent years. The Organization had been granting patents that claimed transgenic plants and animals until 1995, when the EPO’s Technical Board of Appeal issued its ruling in Plant Genetic Systems, which made it impossible in practice to make claims directed to transgenic plants per se. The relevant issues were brought to the EPO’s Enlarged Board of Appeal in Novartis, which was ruled on in December 1999. The Enlarged Board of Appeal came to the conclusion that a correct interpretation of the European Patent Convention would allow the granting of patents for transgenic plants, even in cases where these might include plant varieties.

Judgment of the Court of Justice of European Communities39

Directive 98/44/EC on the legal protection of so-called biotechnological inventions led to a legislative change in various areas in several countries. In this situation, members of the EU can make use of a safeguard clause under which they may exclude from patentability inventions whose commercial exploitation would be contrary to public policy or morality. In particular, processes for the following shall be considered unpatentable: cloning human beings, modifying the germ-line genetic identity of human beings, using human embryos for industrial or commercial purposes, or processes modifying the genetic identity of animals which are likely to cause them suffering without any substantial medical benefit to man or animal, and also animals resulting from such processes.

Member states were supposed to have adopted the necessary legal provisions to comply with the Directive by July 30, 2000, but this period was affected by the appeal lodged by the Netherlands, Italy and Norway before the Court of Justice in Luxembourg, requesting the Directive’s repeal. In its ruling dated October 9, 2001, the Court confirmed the validity of the Directive and left the way clear for national laws to adapt to its provisions.

The ruling stresses that the Directive respects the fundamental right to human dignity and integrity of the person by prohibiting the human body in different states of its constitution and development from constituting a patentable invention, by stating that the elements of the human body are not patentable per se and that their discovery cannot be subject to protection, and by limiting patentability to inventions which combine a natural element with a technical procedure which enables it to be isolated or produced in order for it to be industrially applied. The Court noted that it is possible for an element of the human body to be part of a product which may be patented, but the rights conferred by the patent do not extend to the human body and its elements in their natural environment. In short, the Directive limits patent law so that the human body stays effectively unavailable and inalienable.

Establishment of a provisional patent40

Item (b) of Article 16 of Directive 98/44/EC concerning the “legal protection of biotechnological inventions” requires the Commission to draw up “within two years of entry into force of this Directive, a report assessing the implications for basic genetic engineering research of failure to publish, or late publication of, papers on subjects which could be patentable.”

The article reveals that there are no concrete figures which quantify the economic efforts that should be made by industry or which stipulate the period of time, in practical terms for academia publishers, which should be established before publication is to be deemed late. Member states of WIPO have developed distinct concepts of “grace period” that must be examined in detail for the balance they seek between the interests of academia and industry. It is considered that the American concept of “grace period” and the system of “first inventor” give rise to a higher level of “legal uncertainty,” which is why they should not be used as examples of “best practices.”

Given the growing internationalization of research, both public and private, its importance to innovation and the fact that the public research sector has become the most experienced and important user of the patent system, it is necessary to define and harmonize the concept the “grace period.” This concept, however, will only be valid at the global level if it provides legal certainty, which is the main concern of users of the patent system in the industrial sector.

The study concludes with a recommendation to WIPO’s Standing Committee on the Law of Patents which says that consideration should be given to everything that was mentioned here in the current debate on the possible introduction of a grace period. Conditions should be optimized to facilitate the use of the patent system in the academic world and among small and medium enterprises, including:

Introduction of a provisional patent application in all member states in accordance with Article 5 of the Patent Law Treaty, adopted at Geneva on June 2, 2000.

Support and advice for the academic sector and small businesses on the correct use of the patent system and the strategic use of intellectual property rights, as well as education and training on these topics.

Formulation of a simple and profitable patent system, which should be achieved through the proposed Community Patent.

Chapter 8
Patents in biotechnology

Introduction

Genetic modification techniques allow introducing new traits into living organisms; however, there is still debate about which results of such a modification may be patentable. US law allows patenting all modified organisms: microorganisms, plants and animals other than humans. In Europe, there is a proposal from the European Commission for a Directive of the Council to support the availability of such rights in all countries of the Union.

Efforts are being undertaken to harmonize international law and practice relating to patents. For example, currently, the US grants a grace period of one year between the publication of the invention and the deadline for filing the application for a US patent. Meanwhile, public disclosure of an invention prior to filing the patent application is usually fatal in most European countries.

Another difference is that in American patent law, the term “invention” means invention or discovery. In European law, a “discovery” is distinguished from an “invention,” with the former not being considered patentable. This distinction is not easy to understand. A discovery implies new knowledge, while an invention is the practical application of knowledge. Example: the elucidation by Crick and Watson of the double helix structure of DNA was not a patentable discovery, while subsequent exploitation of this DNA to produce artificially produce DNA and to produce new forms of DNA has led to many patents.

Critical aspects of biotechnology patents41

The high costs of R&D, the nature and the relationship of the processes and products involved, and the intensity of competition for technological leadership explain the importance that innovative firms give to protecting intellectual property in biotechnology. An uncompromising position on patents can be crucial to commercial success and to maintain the trust and support of investors.

The importance attributed to a strong patent position, as well as the novelty and complexity of the subject, have given rise to numerous legal conflicts, creating considerable uncertainty. The legal controversy stems in large part from differences in legal interpretations, lack of specific and accepted standards for treating the subject as well as the delay in granting patents, which often are granted long after significant investments have been made by the company.

The determination of “inventive step” is especially complex in the field of biotechnology. The main reasons are the difficulty in proving the existence of an invention itself, coverage for claims of multiple supposed inventions and the insufficiency of the description to enable implementation of the invention by a person having ordinary skill in the art.

Claims are often defined in biotechnology terms, and the drafting of claims focuses on functional or informational aspects, thereby protecting inventions involving all possible ways to solve problems for entire species or varieties. There are also conflicts about products which may be obtained by a patented invention and by conventional means. The use of a patented product for experimental purposes is a violation of patent rights.

In addition to the “horizontal reach” of patents across plant varieties and species which may sweep public germplasm into privately protected property, the “vertical reach” of protection of improved traits is also problematic. Depending upon the patent claims and their scope, “protection may reach back to unimproved germplasm contained in relatives of a patented plant variety. This vertical reach across generations presents a difficult situation, since previously undescribed parts of the publicly held lines may unknowingly be swept into the category of private property” (STILES, 1989).

A conflict of rights can also arise in relation to a certain patented trait, such as herbicide resistance, which can be incorporated into plants by conventional breeding. Thus, there is no well-defined interface between the patent owner and breeder’s rights. WIPO recommends that “where the owner of a patent concerning a biotechnological invention cannot exploit it without infringing a prior plant variety right, he may apply for a compulsory license for non-exclusive use of the plant variety protected by that right, subject to payment of an appropriate royalty” (CORREA, 1996).

Experiments performed with a patented invention may constitute an infringement of the patent. In the United States, a bill was presented that aims to allow experimentation, even for commercial purposes, unless the primary purpose of the patented article is for research or experimentation. The scope of the exception for research is one of the problems that need to be solved.

Substances occurring naturally42

These substances and complex mixtures of components of natural origin can, in principle, be patented if they are isolated from their natural environment, identified and made available for the first time in conjunction with the development of a process for producing them, and are thus used for specific and useful purposes. This affects inanimate substances as well as living matter. In certain circumstances, such substances are not regarded not as mere discoveries but rather as inventions by the EPO and other legal authorities.

Patents on microorganisms (EUROPEAN FEDERATION OF BIOTECHNOLOGY, 1996)

Patents on microorganisms are routinely granted by the US, European and Japanese patent offices. In 1873, a US patent was granted for Louis Pasteur to a “yeast, free from organic germs of disease, as an article of manufacture.” In the Chakrabarty case in 1980 the US Supreme Court decided that a microorganism was not precluded from patentability solely because it was alive. Therefore a Pseudomonas bacterium manipulated to contain more than one plasmid and thus more effectively break down hydrocarbons was “a new bacterium with markedly different characteristics from any found in nature” and hence not nature’s handiwork but that of the inventor. The “product of nature” objection therefore failed and the modified organism was held patentable. This decision was influential in most other industrially developed countries and the issue is now settled law.

Patents on plants (EUROPEAN FEDERATION OF BIOTECHNOLOGY, 1996)

Plant patents are also obtainable in US, Europe and Japan. The US Plant Patent Act of 1930 is restricted to asexually propagated plants. Over 6,500 of such plant patents have been granted (mostly for rose and fruit trees). In the Hibberd case (1985), following the principle established in the Chakrabarty case, it was decided that normal US “utility” patents could be granted for other types of plant, e.g. genetically modified plants. In Europe, patent law was originally considered unsuitable for protecting new plant varieties developed by traditional breeding methods. Special national laws of Plant Breeder’s Rights (PBR), which are also called Plant Variety Rights (PVR), were therefore established in the 1960s in some countries as well as the International Union for the Protection of New Varieties of Plants (UPOV).

To avoid legal confusion, patent law in Europe subsequently excluded plant varieties from patentability: e.g. EPC Article 53(b) which excludes patents for “plant and animal varieties” as such and “essentially biological processes for the production” of plants and animals. The UPOV Convention was revised in 1991 and now does not prevent dual protection by PVR or patents. This revision awaits ratification by member states and is therefore not yet in force. Plant breeder’s rights have been highly successful in their own sphere. However, legal experts now generally recognize that patent law is better suited to the protection of recombinant methods for producing transgenic plants and the resulting products.

Patents on animal breeds (EUROPEAN FEDERATION OF BIOTECHNOLOGY, 1996)

Animal breeds produced by traditional methods have no legal system for their protection comparable to plant breeder’s rights. Based on the microorganism and plant patent precedents, the US Commissioner of Patents declared in 1987 that US patents would be granted for “non-naturally occurring non-human multicellular living organisms including animals.” The first transgenic animal patent was issued in 1988 to Harvard University with claims covering the “oncomouse”, one in which an oncogene has been introduced to make the animal more susceptible to cancer and therefore more sensitive in testing possible carcinogens. After initial reluctance by the EPO to grant the corresponding European patent (and a successful appeal to the Appeal Board) the European patent was issued. This is now under formal opposition by anti-vivisection and animal rights groups. More than 300 patent applications for transgenic animals have been filed but so far few have been granted (3 in the EPO, 6 in the US Patent Office).

Gene patents (EUROPEAN FEDERATION OF BIOTECHNOLOGY, 1996)

Gene patents are available in all fields of biotechnology. For recombinant DNA inventions, the patent will claim the nucleotide sequence coding for the protein expression product, vectors e.g. plasmids containing this sequence, microorganisms or higher organisms transformed with the sequence, and in appropriate cases the expression product itself (normally only if the product is new per se). Corresponding process technology will also be claimed. The patentability of DNA sequences of unknown function is dubious and controversial. The Human Genome Organisation accepts that patents should be granted for full length genes but is against patenting fragmentary cDNA sequences having no established utility.

Chapter 9
Debate on patents in biotechnology

Introduction (EUROPEAN FEDERATION OF BIOTECHNOLOGY, 1996)

The industries that utilize biotechnology are convinced that intellectual property protection should be obtainable for any inventions which stem from research and which have commercial potential. Biotechnology research workers in academic institutions increasingly share this view because of their need for research funding, which is in part conditional on patentability.

A serious challenge to this assumption has come from a number of interest groups concerned variously with matters of ecology, animal welfare and rights, moral issues and the interests of small farmers and the developing countries. Some of these groups have formally opposed specific European patents and demanded their revocation. For many such groups “patenting life” is considered unethical in principle. The opposition extends also to possible structural change in the agricultural industry which might stem from biotechnology and especially from the acquisition by the larger corporations of legal rights on the advances that are being made.

Legal and moral issues (EUROPEAN FEDERATION OF BIOTECHNOLOGY, 1996)

A legally permissible ground of objection is that genes are naturally occurring entities and that the methods for transferring them to plants or animals are well-known and straightforward. This is a challenge to the inventiveness content of the particular patent at issue; it is an argument that industrial competitors will sometimes use against each other’s patents but so far it has not achieved a high success rate. The argument also lies at the heart of the moral objections many with religious beliefs have to patenting genes. They regard claims of invention, instead of discovery, tantamount to claiming to be God. Some feel that patenting living things changes the relationship between humanity and the rest of nature. However, plants and animals are owned by the farmers who produce them and use them as agricultural commodities.

All such owners, whether of patented or unpatented organisms, are bound to respect animal welfare legislation. The opposers can raise the morality issue where the patent law allows, as in Europe under EPC Article 53(a) which forbids patents for inventions “the publication or exploitation of which is contrary to ‘ordre public’ (public order) or to morality”. The morality objection is being currently used against the European oncomouse patent. To program an animal genetically for certain death in laboratory experiments is morally repugnant to these opposing groups and they feel in conscience bound to protest. Animals have, however, long been used as disease models.

The objection to animal suffering may also apply to the genetic modification of farm animals. Animal welfare groups argue that patents will encourage more research on animal genetic modification, which they oppose on grounds of possible suffering and of principle. Intended to prevent undue suffering, legislation requires the granting of animal experimentation licenses and full disclosure of the experimentation.

Freedoms for breeders and farmers (EUROPEAN FEDERATION OF BIOTECHNOLOGY, 1996)

Freedoms for breeders and farmers are seen by some groups as threatened by patents on transgenic plants and animals. Under PVR (Plant Variety Rights), breeders previously enjoyed the so-called “breeder’s exemption” or “farmer’s privilege” which gave them the freedom not only to use protected plant varieties in their breeding programs but also to commercialize the further varieties developed therefrom (often only “cosmetically” different from the original) without any royalty payment to the owner of the initial variety. The UPOV Convention as revised in 199l now expands the scope of the right of the initial variety breeder to include what are termed “essentially derived varieties” (both the terms “essentially derived” and “variety” are defined). This expansion of the right is not automatic but depends on member states amending their national PVR legislation in conformity with UPOV 1991.

Freedom to research and commercialize (EUROPEAN FEDERATION OF BIOTECHNOLOGY, 1996)

The freedom to research is safeguarded equally under both patent law and PVR law. But the freedom to commercialize the resulting products of research depends on whether or not they infringe the patent claims or are “essentially derived” under PVR law. A strengthened UPOV-type protection would therefore go part of the way towards the strong protection given by patents. Neither system is a threat to the free use of germplasm.

Chapter 10
Latin American experience in protection of biotechnology43

Biotechnology patents

In Latin America, the main forms of legal protection used are: (a) patents; (b) trade secrets; (c) rights on plant varieties; and (d) certificates of invention. In the case of biotechnology, there are specific problems of patenting living organisms and microorganisms, in a variety of situations.

Granting biotechnology patents requires specialized patent offices to have adequate staffing and infrastructure for handling registration, depositing microorganisms, performing novelty tests, arbitrating disputes and disseminating the information contained in patents. Most offices in Latin America have serious deficiencies regarding these aspects.

Animal and plant patents

In most developing countries, there is no consensus about the possibility of patenting plants and animals. Positions taken within WIPO and the GATT indicate a general attitude of caution or rejection of this possibility. In most Latin American countries, there is no express prohibition on patenting animal breeds and the biological processes for obtaining them; the patentability of animals is the responsibility of patent offices and courts.

Pharmaceutical patents (CORREA, 1998)

The emergence of a new research and production paradigm associated with biotechnology is creating tensions and uncertainties in the legal ownership of inventions. The fuzzy boundary between science and technology, in addition to the overlap between companies and government laboratories in the same research fields, favors the dissemination of knowledge and impedes private ownership of knowledge. It is also possible to observe a shortening of the life cycle of new products, which reduces the possibility of recovering R&D costs and financing new developments.

New biopharmaceutical products produce substances which exist in the human body. If one of these substances is patented, the monopoly power of its owner becomes huge, because it is a unique product. Meanwhile, it is possible to generate alternative molecules having equivalent properties, using traditional therapy. This characteristic of biotechnology-based products makes the act of obtaining the legal title crucially important: having legal title is a condition for entry into the market.

The importance of patents for the pharmaceutical industry explains the competitive struggle in the sector. Large companies seek to use the patent system to extend, to as long as possible, the benefits of drugs introduced in the last 20 years. As already discussed, the expiration of the patent releases a portion of the market from monopoly. Pharmaceutical companies holding patents have used a number of mechanisms to palliatively treat the effects of the expiration of these patents. The strategies adopted consist in strengthening brands and differentiating products, in addition to producing generics.

The birth of a new research paradigm and the emergence of a new wave of biopharmaceutical innovations characterize the current situation in the pharmaceutical industry. However, the promises of biotechnology outweigh its achievements: the pharmaceutical sector is one of the first to introduce new products on the market, where expectations are still considerable. The new emerging industrial profile is based on a strong R&D component, while the large investments needed continue to be an important barrier to entry for new competitors.

For developing countries, the issue of patents is much more complex and the benefits are less obvious than those mentioned. Several conclusions can be drawn from the numerous studies on the subject (CORREA, 1998):

In all areas of science and technology, developing countries account for 4% of global R&D expenditures. In the pharmaceutical field, the development of new drugs is almost exclusively concentrated in industrialized countries.

The denial of granting patents on medicines has been practiced by developed countries. Germany, Japan, France, Spain and others recognized patents late, when their industries, their public health systems and their regimes to punish anti-monopoly practices became more developed.

There no evidence that the introduction of patents in developing countries causes a greater flow of foreign investment or even technology transfer. The facts indicate that many drug production plants have been shut down and replaced by offices importing finished products.

All serious studies performed show that the patenting of drugs means increased prices for consumers.

Multinational pharmaceutical companies already control more than 80% of the world market. The additional income that these companies would obtain via patents in developing countries is unlikely to lead to greater investment in R&D for the benefit of those countries.

According to US pharmaceutical companies, the cost of developing a new drug is around US$ 500 million. Academics and consumer organizations, however, not only disagree with this amount, finding it to be excessive, but also believe that a significant portion of new product development costs is actually financed by public institutions.

Investment in R&D by large firms is applied to research on diseases prevalent in industrialized countries. The pharmacological needs of developing countries are neglected.

An intense diplomatic battle has ensued: the arguments of developing countries are reflected in the World Health Assembly of the WHO which in May 1999 approved a resolution granting express mandate for the WHO to monitor and analyze the pharmaceutical and public health implications of relevant international agreements, including TRIPS. This concern was also addressed by the WTO, whose Fourth Ministerial Conference, held in Doha, Qatar on November 9-14, 2001, produced an interpretation of TRIPS which allows countries to produce generic drugs. It still remains to legalize, as a valid practice within the framework of the WTO, the free importation of generic drugs by countries which lack the economic or technological conditions to produce them.

Breeder’s rights (JAFFE, WIJK, 1997)

Protection of breeder’s rights has been introduced in the Southern Cone countries. The explicit objectives have been to promote the activity of private plant breeding and increase access to high-quality foreign varieties. The introduction of breeder’s rights has been the result of a combination of national and foreign industry demands and direct action by some foreign governments. The initiative to provide protection for plant varieties has found opposition from researchers in the public sector and from non-governmental organizations, but not strong enough to prevent this practice.

The only type of protection of intellectual property rights for plant varieties that applies in the region are the laws for Plant Variety Rights or Plant Breeder’s Rights (WENDT; IZQUIERDO, 2000). At the time of this writing, ten countries had signed the UPOV 1978 Act and four were preparing their accession to UPOV 91, since the closing of accession to the 1978 Act. Despite the existence of national laws and regional legal frameworks, countries in the region face similar problems, including:

Seeds are propagated and sold without the corresponding compensation to the breeder. The “farmer’s privilege” allows reserving and planting seeds for one’s own use. However, it is difficult to control “own use,” which favors, for example, some farmers selling seeds.

Lack of awareness about the need for protection of Intellectual Property (IP) rights and the lack of knowledge about what is being protected, indicating, on the one hand, institutional weakness in the enforcement and control of existing regulations, and, on the other hand, the inconvenience of the long processes for granting Plant Breeder’s Rights (PBR).

Due to lack of knowledge about the particularities of PBR, the laws that are passed are poorly formulated and difficult to understand and enforce.

Part 3
Intellectual property regulation in Mercosur Countries

Chapter 1
The case of Argentina

Protection modes

In Argentina, biotechnology investments can be protected legally by two systems: patent law, which grants so-called “inventions patents” and laws on seeds and plant genetic creations, which include granting “property rights for plant varieties” (CARULLO, 1997). This legislation was enhanced during 1996 with the enactment of Law No. 24,766, which governs the confidentiality of the information and products that are legally under a person’s control. This regulation establishes responsibilities for regulatory bodies and establishes a mechanism to address possible violations.

Regarding patents, Law No. 24,481, modified by a similar law, Law No. 24,572 on Patents for Inventions and Utility Models, and Decree No. 260/96, which provides the text specified by these laws and implements their regulatory basis, presents a more modern regulatory framework for addressing the problems of patenting of biotechnological processes and products, while strengthening the institutional structure of the industry by creating the National Industrial Property Institute (INPI) [Instituto Nacional de la Propiedad Industrial]44.

The new law allows the patenting of products developed from biotechnology processes, in the context of authorizing the patenting of any human creation that allows transforming matter or energy so that they may be used by man, provided that it is new, involves an inventive step and is capable of industrial application. In the case of microorganisms, the law authorizes their patenting and establishes the requirements for their storage and reproduction.

Argentina has established a system of protection of plant varieties, indicating crop plants or phytogenetic creations (new plant varieties) as the object being patented. The legislation is based on Law No. 20,247/73, on Seeds and Phytogenetic Creations, on Decree No. 2,183/91, which provides its regulatory basis, and Decree No. 2,817/91, which created Argentina’s National Seeds Institute (INASE) [Instituto Nacional de Semillas]45. In December 1994, Argentina joined the International Union for the Protection of New Varieties of Plants (UPOV 78)46. The application of the plant varieties protection system combines sanitary and quality aspects with breeder’s rights, and establishes a system for monitoring compliance with breeder’s rights. About 45 seed companies and national and international institutes, representing 80% of the breeders’ organizations of the country, are part of the Argentine Association for the Protection of New Varieties (ARPOV) [Asociación Argentina de Protección de las Obtenciones Vegetales].

The collective control exercised by plant breeders and public authority has been fully effective in reducing the black market in seeds, at least in some crops, demonstrating that the implementation of legislation to protect breeder’s rights requires the following attributes: sufficient quality control of the seed market; a good system of registration of varieties; qualified, impartial authority with adequate human resources; efficient processes; a transparent system of appropriate sanctions, and initiatives by breeders to protect their rights (JAFFE; WIJK, 1997).

Patent legislation (CARULLO, 1997)

Materials eligible for protection

The legislation for patents on inventions provides the principle that inventions can be protected in all genres and areas of production. Inventions of products or procedures shall be patentable provided that they are new, involve an inventive step and are capable of industrial application.

This law considers an “invention” to be any human creation that allows transforming matter or energy so that it can be used by man. There is an inventive step when the creative process or its results are not deduced from prior art, in a manner obvious to a person having ordinary skill in the art, and there is industrial application when the object of the invention leads to obtaining a result or a product of agriculture, forestry, livestock, fisheries, mining, processing industries and services.

Patent owner

The right to the patent belongs to the inventor, who shall have the right to assign or transfer it by any lawful means and to grant licensing agreements. Unless proved otherwise, the person or persons who declare themselves as the inventor in the patent application or utility model certificate shall be considered to be the inventor. The inventor or inventors are entitled to be mentioned in the corresponding patent.

Inventions developed during a working relationship have a detailed treatment under this law. Inventions made by the employee during the course of an employment contract or employment or service relationship with the employer, whose purpose, in whole or in part, is to carry out innovative activities, belong to the employer. The employer also has rights to an invention made by an employee of the company if this invention is related to the professional activity of the employee and if the inventor has been significantly influenced by knowledge acquired within the company, or has used resources provided by the company.

In the first case, the worker who created the invention shall be entitled to additional remuneration for their achievement, if the personal contribution to the invention and its importance to the company or the employer clearly exceed the explicit or implicit content of their contract or service relationship. In the second case, the right to fair economic compensation can reach up to 50% of the royalties.

Work inventions developed under circumstances not satisfying those mentioned above belong exclusively to the inventor. Also, any advance waiver of employee rights under this article shall be null and void.

Conditions for protection

The law requires that in order to be patentable, the invention must be new, meaning it must not be disclosed in prior art, i.e., in the set of technical skills that had become public before the filing date of the patent application or, in other cases, with priority recognized by an oral or written description, by commercial exploitation or by any other means of communication or information in the country or abroad.

The disclosure of an invention does not affect its novelty, if within one year prior to the date of filing the patent application or the recognized priority, the inventor has disclosed the invention by any means of communication or has displayed it in an exhibition at the national or international level. The condition of novelty does not exist in the case of reinstated patents, since the only requirement is that the foreign patent which is desired to be reinstated be valid within the country.

When a patent is being applied for after having been applied for in another country, for purposes of recognizing priority, the date when the first patent application was filed shall be used, provided no more than one year has elapsed since the original filing. Where several inventors have made the same invention independently, the patent right shall belong to the one who applied for it where the patent application filing date, or the recognition of priority, is the oldest. If the invention was made jointly by several persons, the patent right shall belong in common to them all.

For applications related to microorganisms, the product obtained by a patent claim directed to a process must be described in the application along with the process, and the strain of microorganism must be deposited at an authorized institution, according to the standards prescribed by regulations.

Requirement of deposit of biological material

When the object of a patent application is a microorganism, or when, for its execution, a microorganism is required which is not publicly known or available, the applicant shall deposit the strain of microorganism at an approved institution recognized by Argentina’s INPI, on or before the date when the application is filed.

Argentina’s INPI shall recognize, for the purposes of receiving microorganisms in deposits, the institutions recognized by the World Intellectual Property Organization (WIPO), or those which meet the following conditions: they must be permanent; they must not be dependent on control by the depositors; they must have staff and facilities appropriate to prove the relevance of the deposit and guarantee its storage and maintenance without risk of contamination; and, most importantly, they must provide the safety measures necessary to minimize the risk of loss of the material deposited.

At any time from the date of publication of the patent application, access to the strain of microorganisms in the depositing institution may be obtained, provided that the ordinary conditions governing this operation are complied with.

Rights conferred and limitations

A patent on an invention grants its owner the exclusive right of exploitation. The legislation applies sanctions against defrauding the patent owner’s rights as a crime of counterfeiting. Sanctions are also provided against any parties which, while being aware of the counterfeiting, cooperate with it, either by selling, displaying or introducing, or by communicating the protected invention.

The right conferred by a patent has no effect on individuals who manufacture or use a product or use a process which is the same as the patented one, in cases where such use is performed in the private or academic sphere for non-commercial purposes, associated with purely experimental R&D activities, for testing or teaching purposes. It also does not affect the preparation of medicines performed on a regular basis by qualified professionals and by entities pursuant to the execution of a prescription, nor acts related to medicines so prepared.

The right does not affect any person who purchases, uses, imports or otherwise sells the product patented or obtained by the patented process if the product has been lawfully placed into trade in any country, in accordance with the Agreement on Trade-Related Aspects of Intellectual Property Rights (GATT-TRIPS Agreement, Part III, Section IV).

Argentina’s INPI, in accordance with requirements established by the competent authority, may provide limited exceptions to the rights conferred by a patent. The guiding elements of the law are: anti-competitive conduct, lack of commercial exploitation and national health emergencies.

The right to commercial exploitation conferred by a patent shall be granted, without authorization of the patent owner, when the competent authority acknowledges that the patent owner has engaged in anti-competitive conduct, which is understood to include: setting prices which are excessive compared to the market average or which are discriminatory towards patented products; being unable to supply the local market on reasonable commercial terms; cessation of business or production activities; and any other act that fits the behavior considered punishable by Law No. 22,262.

Argentina’s INPI may allow other uses of a patent without authorization from the owner, when a potential user has attempted to obtain the granting of a license from a patent owner on reasonable commercial terms and such attempt has not been handled within a reasonable time, or to permit the commercial exploitation of a patent which cannot be exploited without infringing another patent, provided that the invention offers a significant technical advance of considerable economic importance. Under these conditions, the owner of the first patent shall be entitled to obtain a cross-license.

Three years after the granting of the patent, or four years after the filing of the application if the invention has not been commercially exploited (except in cases of force majeure) or if effective and serious preparations to use the invention have not been made, or when its commercial exploitation has been interrupted for more than one year, any person may request authorization to use the invention without permission of the patent owner. A product shall be considered to be properly exploited when there is distribution and commercialization sufficient to satisfy the demand of the domestic market on reasonable commercial terms.

In addition to reasons legally recognized as such, the following shall be considered force majeure: objective difficulties of a technical-legal nature, such as delays in obtaining permits from public bodies, beyond the control of the patent owner. Lack of economic resources and lack of economic feasibility of exploitation do not in themselves constitute justified circumstances.

The Executive branch may, for reasons of medical emergency or national security, provide for the use of certain patents, by granting the right of commercial exploitation. Its scope and duration shall be limited to the end of the concession, with the assistance of the Ministry of Economy and Public Works and Services, the Ministry of Defense and the Ministry of Health and Social Action, within the legal framework of the jurisdiction of the ministries.

If other uses are allowed without the authorization of the patent owner, the patent owner shall receive reasonable remuneration, according to the circumstances of each case, depending on the economic value of the authorization. If there is no agreement between the parties, the authorization application shall establish a reasonable remuneration to the patent owner, taking into account the average rates of return for the relevant sector, as found in contracts for commercial licenses.

Once the circumstances are no longer occurring and these concessions are void, the legitimate interests of the persons who received such authorization shall be taken into account. In the case of semiconductor technology, non-commercial public use or use for rectification of conduct declared to be anti-competitive shall be allowed only after legal or administrative proceedings.

The owner of a patent granted in Argentina shall have the right to prevent third parties from performing acts of making, using, offering for sale or importing into the country the patented product, provided said product has not been lawfully placed into trade of any country. A product shall be deemed lawfully placed into trade when the person authorized for marketing in the country proves permission for purchase from the patent owner in the country or from the third party authorized for marketing.

The defrauding of the rights of the inventor is considered counterfeiting and shall be punishable by 6 months to 3 years of imprisonment and a fine. The same penalty shall be imposed on those who knowingly: produce or cause to be produced one or more goods in violation of the rights of the owner of the patent or of the utility model; or who import, sell, offer to sell or market or exhibit or introduce into the territory of the Republic of Argentina one or more objects in violation of the rights of the owner of the patent or the utility model. The law provides for aggravating circumstances for persons directly linked to the inventor or the application office staff, who usurp or disclose an invention, even if not protected.

In addition to criminal prosecutions, the owner of the patent and his licensee may exercise civil actions to prohibit continued illegal exploitation and to obtain compensation for damages suffered. The plaintiff may apply for suspension of operation or request a security from the defendant so as to not interrupt him in the exploitation of the invention, if the latter wishes to continue with its commercial exploitation.

Duration

An invention patent is granted for 20 years with no extensions, counted from the date of filing. Additional patents (improvements to already patented inventions) shall be granted for the duration of the basic patent, and where there are several, the longer one shall apply. A utility model certificate shall have a term of 10 years with no extensions, counted from the date of filing.

Exploitation of patents: licenses

The patent and utility model shall be transferable and shall be eligible for a license in whole or in part, the granting of which must be recorded with Argentina’s INPI. Licensing agreements must not contain restrictive trade clauses that affect the production, marketing or technological development of the licensee, which restrict competition or which involve other conduct such as exclusive grant-back conditions, conditions which prevent challenging the validity, conditions which impose mandatory joint licenses, or any of the conducts specified by Law No. 22,262.

Unpatentable materials

For the purposes of the law, the following shall not be considered inventions, among others: discoveries, scientific theories and mathematical methods; scientific works, plans, rules and methods for pursuit of intellectual activities, as well as computer programs, methods of surgical, therapeutic or diagnostic treatments applied to the human body and those relating to animals and all kinds of living matter and substances preexisting in nature. Plants, animals and essentially biological procedures for their reproduction shall not be considered patentable.

The following are not patentable: inventions whose exploitation in the territory of Argentina would constitute an obstacle to protecting the health or life of persons or animals, preserving plants or preventing serious harm to the environment; all biological and genetic material existing in nature or its replica, in biological processes implicit in animal, plant and human reproduction, including processes related to genetic material capable of conducting its own replication in normal and free conditions, as occurs in nature. For such purposes, Argentina’s Executive branch may also prohibit the manufacture and commercialization of inventions.

Pharmaceutical patents

Pharmaceutical inventions began to be patentable in Argentina five years after publication of Law No. 24,572 in the Official Gazette [Boletín Oficial]. As of the current date, there are no provisions in effect pertaining to the patentability of pharmaceutical inventions, nor precepts directly pertaining to their patentability. However, applications may be filed for patents on pharmaceutical products, which have been granted since March 22, 2001.

The patent owner shall have exclusive rights over the invention from the date specified, unless those who are making use of the invention without the patent owner’s authorization ensure full supply of domestic markets at the same real prices. In this case, the patent owner shall only be entitled to receive a fair and reasonable compensation from those who are using it, from the granting of the patent until its expiration. If there is no agreement between the parties, Argentina’s INPI shall determine this compensation. The law provides that this situation can be modified to enforce decisions of the World Trade Organization adopted in accordance with the GATT-TRIPS agreement.

The law also states that patent applications filed abroad before the enactment of Law No. 24,572 may be presented, provided that the first application has been made within the year prior to the enactment of the law without exploitation or commercial scale import of the invention having been initiated. The term of validity of patents granted under these conditions is the same as the expiration date in the country where the first application was filed, provided this does not exceed 20 years.

Applications for patents on pharmaceutical products whose first applications in Argentina or abroad were filed before January 1, 1995 will not be accepted, except for cases where the applicants claim priority under the Paris Convention. In no case may the first application serving as the basis for the initiation of proceedings in Argentina have been made prior to January 1, 1994. The same criteria shall be applied in cases of applications to modify or convert patents on processes to patents on pharmaceutical products.

Publication and confidentiality

The patent application in process and its attachments are confidential until publication. The National Patent Administration (ANP) permits the publication of patent applications in process within 18 months, counted from the filing date. If requested by the applicant, the application may be published before this date.

All staff of ANP involved in the handling of applications are required to maintain confidentiality with respect to the content of patent application filings, with the exception of information of an official nature which may be requested by the judiciary. The administrative technical information contained in patent application filings is secret, and agents of the ANP and the Argentina’s INPI shall not allow it to be known, disclosed or used by uninvolved third parties.

Officials and employees who violate this secrecy shall be liable to the corresponding legal action, subject to penalty of dismissal and fines if they are direct dependents of Argentina’s INPI, ANP or any entity which is required to be involved for technical reasons.

Protection of new varieties of plants (CARULLO, 1997)

Materials eligible for protection

The Seeds Law protects “phytogenetic creations” (“novel plant varieties”) or “cultivars” under breeder’s rights, where the breeder is understood to be the person who creates or discovers and develops a variety. It does not authorize the granting of protection for first generation hybrid plant varieties, nor for phytogenetic creations which do not meet legal criteria47.

The Seeds Law considers a “seed” to be any plant organ, not only seeds in the strict botanical sense but also fruits, bulbs, tubers, buds, cuttings, cut flowers and any other structure, including nursery plants, which are intended or used for cultivation, planting or propagation. A “novel plant variety” means any plant variety or crop, whatever its genetic nature, obtained by discovery or by incorporation and/or application of scientific knowledge. The definition incorporates all types of biological material that can be reproduced and propagated, including all biotechnology applied for the micropropagation of plant species using asexual or vegetative reproduction.

A “variety” means the set of plants of the same botanical group of the smallest known standard which can be defined by the expression of the characteristics resulting from a given genotype or a certain combination of genotypes, and which can be distinguished from any other group of plants by the expression of at least one of these characteristics. A particular variety may be represented by one plant, various plants or parts of a plant, provided that such part or parts can be used to produce complete plants of that variety.

Patent owner

The right of ownership of a crop belongs to the person who obtained it. Unless expressly authorized by this person, the people involved in the work related to the new plant variety or discovery of the new crop shall not be entitled to exploit it privately. The request for a title of ownership for a foreign plant variety must be made by its breeder or his legal representative domiciled in Argentina. It shall be granted provided that the country where it originated recognizes rights for novel plant varieties similar to those recognized in Argentina.

Conditions for protection

The law establishes the following requirements for protection:

Novelty: It must not been offered for sale or commercialized by the breeder or with his consent: in national territory, until the date of filing the application with the National Registry of Proprietary Plant Varieties (RNPC) [Registro Nacional de la Propiedad de Cultivares]; and in the territory of another State which is a party, together with Argentina, to a bilateral or multilateral agreement on the matter, for a period exceeding four years, or in the case of trees and vines, for a period longer than six years prior to the application for registration.

Differentiation: It must be clearly differentiable it through one or more traits from any other variety whose existence is a matter of common knowledge at the time the application is filed.

Uniformity: It must maintain it most important hereditary traits in a sufficiently uniform manner, subject to expected variations arising in the particular mechanisms of its propagation.

Stability: Its hereditary most important traits must remain in conformance with their definition after repeated propagation or, in the case of a special cycle of propagation, at the end of each of said cycles.

Rights conferred and limitations

Ownership titles on plant varieties give their beneficiaries a property right on the plant obtained. The legislation does not specify the scope of this property right, though the note that accompanied the bill when presented for approval states that the title to a plant shall operate in such a way that no other person may reproduce or sell the plant without authorization.

The property title on a plant does not prevent others from using the plant to create a new one, as long as the first plant is not permanently used to produce the new plant. Persons who keep and plant seeds for their own use, or who use or sell the product of the plant as a raw material or food, do not infringe upon the property title on the plant.

The property title on a plant may be declared for “restricted public use,” with fair compensation to the owner, when it is determined that such declaration is necessary in order to ensure an adequate supply in the country of the product obtained from cultivating this plant and that the property rights holder is not supplying the public needs for the seeds of such plant variety in quantity and prices which are considered reasonable.

Duration

The title to a plant is granted for a period of between 10 and 20 years, namely: 12 years for annual species, biennial species for 15 years, and 20 years for perennial species. A property title obtained for a foreign plant shall have as duration the maximum time remaining for the validity of the corresponding right in the country of origin.

Law of confidentiality (KORS, 1998)

Argentine law on this matter is based on the provisions of Article 39 of the TRIPS Agreement. It recognizes “exclusive rights” and protects against unfair competition, that is, against dishonest or unfair commercial practices. Under competition law [US: antitrust law], unfair competition is a residual category of law, i.e., it protects what can not be protected in other areas of law. It is a growing area of law, since its modern theory incorporates all intellectual property rights – and in particular industrial rights – within the field of competition law, as a broader issue.

In order for this type of secret information to be able to protected in accordance with the provisions of Law No. 24,766, certain requirements must be met: (a) the information must first be really secret; (b) it must be commercially valuable because it is secret; (c) all necessary measures must have been taken to maintain it with a certain degree of confidentiality. In short, there are the following requirements: to keep the information secret, to be commercially valuable due to this situation, and, finally, to resolutely maintain the confidentiality.

In order for the secret information to be protected by law, it must have an economic value and must also be voluntarily protected, which means that the owner or the person or entity having lawful control over it must do everything necessary to keep it secret. Therefore, their neglect is a negative element to achieving protection. This information shall only be protected if the secret is kept. If it is obtained in a lawful manner, then nobody shall have the right to object to knowledge which was legitimately obtained.

The law only protects the secret if its disclosure has been illegal. This is in sharp opposition to patent law. Patent law is unique and exclusive, but trade secrets are not. Anyone else who comes by this knowledge in different ways can use it and dispose of it, if they can demonstrate that their access was lawful. Law No. 24,766 is very brief and very concrete: it consists of fifteen articles, of which the last one is purely formal. The Act is divided into three parts: a general part; a part on special protection in relation to chemicals or pesticides, which must be submitted to government agencies for authorization and registration for commercial sale; and a third part, relating to actions involving confidentiality.

Regulatory institutions

National Industrial Property Institute (INPI) (Felix, 1998)

Argentina’s National Industrial Property Institute (INPI) [Instituto Nacional de la Propiedad Industrial] is an autonomous body with legal personality and its own assets, and operates under the Ministry of Economy, Public Works and Services [Ministerio de Economía, Infraestructura y Servicios Públicos]. Its mission is the protection of industrial property rights, through the granting of titles and/or the implementation of registries established by national legislation for this purpose. In this sense, Argentina’s INPI is the enforcement agency for the following laws: No. 24,481 (Patents and Utility Models), No. 22,362 (Trademarks) and No. 22,426 (Technology Transfer), and Decree-Law No. 6,673/63 (Models and Industrial Designs).

Decrees 1,049/2001 and 1,115/2001 establish that Argentina’s INPI, similar to most organizations governing intellectual property throughout the world, shall be directed and administered by a president and a vice-president, who shall seek greater efficiency and speed in decision making. In case of temporary or permanent absence or unavailability of the president, his functions shall be performed by the vice president, who also exercises powers delegated by the president.

The management and administration of bureaucratic procedures, studies and resolution of patent grants and utility models is the duty of the National Patent Administration (ANP), which reports to Argentina’s INPI. It is directed by a commissioner and a deputy commissioner of patents, designated by the INPI Board. ANP performs a range of services that are geared towards guarding property rights on products of inventions activities. Its operations can be summarized as follows:

Granting industrial property rights by processing, analyzing, approving and publishing them.

Enforcing international agreements which Argentina has joined in the area of invention patents.

Providing advice to facilitate processing, performed by staff having the appropriate training.

The main activity of ANP is to grant industrial property rights as the only authority for the enforcement of Law No. 24,481 (consolidated text 1996 [T.O. 1996]) and Regulatory Decree No. 260/96. The law provides for granting industrial property rights relating to invention patents and utility model certificates. ANP grants property rights in exchange for publication of inventions, disseminating material rich in technical and legal information, which is the basis for new developments, thereby contributing to the promotion of sustainable scientific and technological development in society.

Argentina’s INPI establishes a registry for invention patents and one for utility model certificates. The owner of a patent may, from the date of grant, request inclusion in the Registry of Patents Open to Voluntary Licensing, which may be consulted by interested parties. INPI publishes a Newsletter of Patents and Trademarks, and Books of Trademarks, Patents, Utility Models and Models and Industrial Designs.

Argentina’s INPI began operating in December 1995. Its budget comes from taxes collected on various procedures performed by the Institute and fees for additional services. Currently, its funds are allocated from the national budget.

The Trademark Director’s office manages enforcement of trademark law. The official function of this office is to record applications for trademarks which have been filed. The procedure is quite simple: an application is made for a trademark and the office performs a preliminary study. The Trademark Director’s office publishes a weekly newsletter, where filed applications can be tracked and objections can be raised. For example, a study conducted in 1996-1998 shows that the greatest number of trademark applications were from the United States, followed by Germany, France, UK, Brazil, Switzerland, Spain, Italy and Chile.

The Technology Transfer Director’s office is responsible for enforcing Technology Transfer law. The Technology Transfer Director’s office records international transfers of technology. While this process is not mandatory, it provides many advantages to businesses; i.e., it provides a legal guarantee, allowing a contract and related documentation to be recognized from a given date. Depending on the purpose of the contract, direct tax benefits can be obtained, and it is possible to participate in international agreements on double taxation, signed by the following countries: Germany, Australia, Canada, Brazil, Chile, Denmark, Spain, France, Italy, Belgium and Sweden. Because registration is voluntary, the statistics do not show a precise timeline of when technology was imported. The record is, however, valuable for general information purposes.

In 1993, the Department of Technology Information was created, which has a dual function. It is in charge of performing the search for prior patents for use by examiners from the National Patent Administration (ANP) office, and it provides information to the public conducting national and international searches on groups of patents. The Department provides information services for industry, researchers and inventors on the patent documents for products, devices and technology in general, performing searches on internal and external databases to provide information on specific technologies.

Simultaneously with the formation of Argentina’s INPI, the National Patent Administration (ANP) was created, which reports to INPI and is the enforcement authority of laws for invention patents and utility models. ANP is higher in the hierarchy than the other Director’s offices. ANP has an obligation to provide information for applications filed and on all resolved proceedings. This information is published weekly in the patents bulletin. INPI is responsible for publishing books of all patents, trademarks, industrial designs that have been granted, on an annual basis.

Patent applications filings have noticeably increased. In 1997, almost 6,500 applications for invention patents were filed, and 7,031 in 2000. This increase relates to applications for utility models and for pharmaceutical patents. The pharmaceutical sector accounted for 16% of patent applications filed since Patent Law No. 24,481 went into effect. In 2000, a total of 7,031 patent applications were filed, of which 397 were for utility models. Of these applications, 3,766 were resolved and 1,514 patents were granted. Of that number, 101 were for the area of biotechnology.

INPI recognizes deposits of microorganisms made at depositary authorities in countries that have joined the Budapest Treaty.

National Seeds Institute (INASE)

The enforcement agency for the Seeds Law is the National Seeds Institute (INASE) [Instituto Nacional de Semillas], an autonomous government agency of the Department of Agriculture, Livestock, Fisheries and Food. INASE is in charge of the National Registry of Plant Varieties (RNC) [Registro Nacional de Cultivares], which is an official list of plant varieties. Registration is compulsory for all seeds identified, in order to contribute to standardization and knowledge and to avoid duplication.

INASE grants titles for new plant varieties and administers the RNC and the National Registry of Proprietary Plant Varieties (RNPC) [Registro Nacional de la Propiedad de Cultivares]. INASE also deals with national and international certifications, according to OECD standards, for the varietal identity of every vegetatively propagated organism, and quality control for physiological, physical-botanical, sanitary and genetic aspects of seeds intended for internal and external marketing, according to rules of the International Seed Testing Association (ISTA), which sets standards in order to facilitate trade.

Since 1996, 732 applications for protection of plant varieties have been approved. The ratio of national versus foreign new varieties changed gradually from 67% versus 33% in 1994, to 37% versus 63% in 1999 (WENDT; IZQUIERDO, 2000).

Chapter 2
Intellectual property regulation in Brazil

Introduction

The evolution and development of new technologies are directly subordinated to industrial property rights of the different entities involved, including the state, academia and the private sector (MATTOS, 1998).

One of the problems currently faced by people engaged in this area involves adjusting the concept of ‘invention’ to their creations, which is an essential criterion in order for their creations to be eligible for patent privileges under Brazil’s Industrial Property Law No. 9,279/96. Undoubtedly, many issues are still unclear regarding which biotechnology products can be considered to be inventions. Under most national laws, including Brazilian law, a distinction is made between invention and discovery, the second being excluded from the privilege of a patent. Some countries, however, employ the two words as synonyms, leading to confusion in international jurisprudence. Currently, only inventions are protected, except in a minority of Asian countries, but questions remain about how to identify inventions.

According to Friedrich-Karl Beier and Joseph Straus (cited by WOLFF, 1997), in their book The Protection of Scientific Research Results [Der Schutz Wissenschaftlicher Forschungsergebnisse], there are three steps inherent in an inventive process:

The research stage itself, which includes scientific advances.

The development stage, which includes technical advances.

The implementation phase of the research, which represents social and economic advances.

The development stage is where patented inventions are created, and it is often at this stage that patent applications are drawn up, even if the overall inventive context of the newly developed product or process has not yet been completed in detail. The implementation phase involves the commercial use of the product or process.

In the period 1980-1993, the number of patent applications filed in Brazil was around 8,500. In the shorter period 1993 to 2000, 20,000 applications were filed. The most prominent sectors included: chemical and pharmaceutical, electrical and electronics, and mechanical. This increase may reflect the current legislation on the subject since 1996, when patent application procedures became more flexible (CAVALCANTI, 2002).

Intellectual Property Rights (IPR) related to genetic resources

There are two ways to protect innovations: by technical and/or by legal means.

Intellectual Property Rights (IPR) are legal mechanisms to prevent unauthorized use of an innovation. They are an exclusive and temporary right, granted by the national authority. The objectives of Intellectual Property Rights include encouraging innovation and disseminating innovation.

Certain agreements affect intellectual property rights over genetic resources, including:

the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), administered by the World Trade Organization (WTO).

the International Union for the Protection of New Varieties of Plants (UPOV).

the Convention on Biological Diversity (CBD).

the FAO’s International Treaty on Plant Genetic Resources for Food and Agriculture (IT PGRFA).

Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS)

The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), a framework for national legislation laying down minimum standards for IPR protection, administered by the World Trade Organization (WTO), was approved in April 1994 and ratified by 138 countries. Its purpose is the protection of IPR, promoting innovation and technology transfer and dissemination.

According to Article 27.3(b) of TRIPS, members may exclude from patentability “plants and animals other than microorganisms, and essentially biological processes for the production of plants or animals other than non-biological and microbiological processes. However, Members shall provide for the protection of plant varieties either by patents or by an effective sui generis system or by any combination thereof....”

Plant Breeder’s Rights (PBR)

Plant breeder’s rights (PBR), also known as plant variety rights (PVR), are a form of sui generis (specially designed) system ensuring the rights of the breeder and preventing others from commercially selling reproductive material without a license. In order to be able to be protected under plant breeder’s rights, it is necessary for the plant materials in question to be distinct, uniform, stable and new.

What distinguishes plant breeder’s rights from patents are: the cost, the farmer’s privilege provided by PBR (allowing farmers to store their production for their own use as seed, without necessarily allowing sales of seed), and the breeder’s exception provided by PBR (allowing breeders to use protected varieties as sources of initial variation to create new varieties of plants, or for other experimental purposes).

Andean Community

According to Decision 391 on the Common Regime on Access to Genetic Resources [Régimen Común sobre Acceso a los Recursos Genéticos] of the Andean Community’s Treaties and Legislation [Normativa Andina], “the Member Countries shall not acknowledge rights, including intellectual property rights, over genetic resources, by-products or synthesized products and associated intangible components, that were obtained or developed through an access activity that does not comply with the provisions of this Decision.”

Patents and industrial property

Brazil’s “pipeline patent” is an instrument of transition between the patent protection regime and Industrial Property Code of 1971 – which had excluded protection for chemical substances, compositions and products, in particular for the chemical, pharmaceutical and food industry – and the new patent law, which extends protection to these areas.

Industrial property is the recognition of rights to a patent or a brand on the part of whoever developed it, subject to compliance with the provisions of Industrial Property Law No. 9,279/96, granted by Brazil’s National Industrial Property Institute (INPI).

The rules governing this issue are regulatory acts which are guidelines to help the person to meet the provisions of Law No. 9,279 and obtain the rights to the patent or the brand to which the claim is directed.

Patents have the following basic functions:

To ensure the possibility of return on investment in research, development and production, by granting an exclusive position, legally recognized and for a limited time.

To encourage prompt and adequate public knowledge of new technologies.

Patent legislation around the world

In Germany and Switzerland, there are only two situations:

If the invention was developed during the employee’s employment contract, the employer is entitled to claim the invention, with the employee receiving royalties for the life of the patent.

If the invention occurred outside the time of the employee’s employment contract, the employee retains all rights.

In Japan, the encouragement of inventions is so great that the inventor receives profits on three occasions if he was employed. First, when filing the application; second, when the patent is granted; and third, when it is sold. This causes the invention to be surrounded by many small patents in all its details.

The United States follows, in principle, the position of Germany and Switzerland, but at the same time, offers significant encouragement to researchers from universities and research centers. At the University of California, as well as at other universities, there is a technology transfer center that handles all intellectual property rights, including the searching for licensees, marketing the invention, requesting records and splitting the royalties earned with the researchers (50%).

Patents in Brazil

In Brazil, there has been progress in recent years in biotechnology legislation. The country has adopted a patent law and has biosafety legislation: the Biosafety Act of 1995, repealed by Draft Law PL No. 2,401-03, the Patent Act of 1996 and the Plant Variety Protection Act of 1997.

The following list shows the major changes in the legal context of intellectual property in Brazil:

Revision of the Patent Code of 1971, which resulted in Law No. 9,279/96.

Revision of the Copyright Law of 1973, which resulted in Law No. 9,610/98.

Approval of the Plant Variety Protection Act (Law No. 9,456/97) and the Law on Protection of Computer Programs (Law No. 9,609/98).

Proposal in the National Congress of the Draft Law on Integrated Circuit Layout Design Protection (PL No. 1,787/96).

Ratification of the Agreement Establishing the World Trade Organization and fourteen trade agreements of the Uruguay Round of the GATT negotiations (Legislative Decree No. 1,355/94) including TRIPS (Trade Related Aspects of Intellectual Property Rights), establishing the minimum level of harmonization with regard to the effects of intellectual property on international trade.

These changes were advocated by several positive aspects of the TRIPS Agreement, namely:

Recognition, among the general principles of the Agreement, that the protection of intellectual property rights should contribute to the promotion of technological innovation and transfer and dissemination of technology in a manner conducive to social welfare and a balance between economic and rights and obligations (Article 7).

Applicability of the dispute settlement system of the World Trade Organization to matters involving intellectual property, greatly reducing the possibility of unjustified unilateral measures against Brazil by major trading powers (Articles 63 and 64).

Respect for existing obligations of the major relevant treaties (Paris Convention, Berne Convention, Rome Convention and the Washington Treaty on Intellectual Property in Respect of Integrated Circuits), to which Brazil is signatory (Article 2).

Possibility of recourse to safeguards such as compulsory licensing and patent expiry, for example due to national emergencies and the occurrence of anti-competitive practices or unfair trade practices (abuse of law or of economic power) (Article 31).

Non-applicability of the system of dispute settlement in matters concerning international exhaustion of rights (Article 6).

Obligation to grant protection for plant varieties, a sector in which Brazil is highly competitive (Article 27.3.b).

Paris Convention for the Protection of Industrial Property

In turn, the Paris Convention for the Protection of Industrial Property, established in 1883, was the first multilateral treaty to address industrial property patents, trademarks and unfair competition. Its guidelines have already undergone six revisions, the last one in 1967 in Stockholm. There are 40 signatory countries, which form the Paris Union (exceptions: India and Taiwan).

The Paris Convention is administered by the World Intellectual Property Organization (WIPO), a specialized agency of the United Nations, based in Geneva, Switzerland.

The basic principles of the Paris Convention, which are mandatory for the signatory countries to comply with, are: national treatment, the “Convention priority right” (also called “Paris Convention priority right” or “Union priority right”) and independence of patents.

National treatment: Each signatory country must treat residents and non-residents in the country equally. No special legal treatment may be given in favor of residents, passing over non-residents.

Convention priority right: The Convention priority right aims to ensure that, based on a first patent application duly filed in one of the signatory countries, the applicant may, during a period of 12 months (for industrial patents and utility models) or 6 months (for industrial designs), seek protection for the same invention in any of the other signatory countries.

Independence of patents: Patent applications filed and granted in the signatory countries to the Union are independent of the corresponding patents obtained for the same invention in other countries, whether they are or not signatories to the Paris Convention. The granting of a patent in one signatory country does not require another signatory country to grant patents for the same invention.

Brazil’s National Institute of Industrial Property (INPI)

The INPI has the following responsibilities:

Managing the industrial property system in the country.

Granting invention patents and utility models.

Granting registration of trademarks and industrial designs in the country.

Suppressing false geographical indications and unfair competition.

Filing the collection of patent documentation for various developed countries.

The INPI currently has a collection of some 25 million patent documents in its patent database.

Concepts that govern the granting of a patent

Certain prerequisites are stipulated to allow applying for a patent: novelty, inventive step, capability of industrial application and descriptive adequacy.

The definition of “novelty” is understood as anything that is not disclosed in prior art, which consists of everything made accessible to the public by any means, with an exact date of disclosure and sufficiently described so that it can be understood by a person having ordinary skill in the art.

In the case of biotechnology, Article 10, section IX of Law No. 9,279 clearly states its non-recognition of the novelty of materials found in nature that may be used industrially in their natural state.

In the area of biotechnology, there is a clear division between pure scientific creation and technological creation. Thus, only patenting of products with obvious industrial application is justified.

Likewise, the notion of “inventive step” recognizes that the product is not merely a result of the prior art. For this purpose, a distinction between discovery and invention must be made. The definition of “discovered” is understood to mean the identification of a natural phenomenon, without the exercise of man’s creative activity and, therefore, not capable of industrial application. The notion of “invention” consists of a new idea which results from the creative activity of man, which allows, in practice, a solution to a specific technical problem, and is therefore capable of industrial application.

The notion of “descriptive sufficiency” in biotechnology is unique, since it requires supplementation of the patent application with a deposit of biological material at an internationally recognized depositary authority. It is the duty of the depositary authority to receive, maintain and store samples of biological material and make them available to the technically qualified public.

According to the Budapest Treaty, adopted in 1977, in effect from 1980, it was agreed that a deposit made at a single international authority is sufficient for the purposes of patent procedure for all the other organs of the official patent signatories of the Treaty (single fee). This measure aims to eliminate or limit the multiplicity of culture deposits. Thus, it has the advantage of minimizing costs and providing greater security. All signatories of the Paris Convention may have access to the deposit.

Based on the Budapest Treaty, the status of International Depositary Authority (IDA) was recognized.

Thus, an International Depositary Authority (IDA) is a collection of cultures officially recognized by the industrial property office of the country. The culture collections are not universal, i.e., they are always limited to a certain type or types of microorganisms depending on the training of human resources and on the infrastructure available.

The requirements for the recognition of an IDA under the Budapest Treaty are: the institution must be located within the territory of a contracting country; its facilities and staff must be approved by the contracting country; it must exist continuously; it must have sufficient specialized staff and equipment; it must be impartial and objective; it must be accessible to any applicant on an equal basis; it must accept species of microorganisms; it must examine their viability and store them according to the criteria established in the Regulations under the Budapest Treaty; it must publish the declaration of receipt and viability of the biological material being submitted for filing; it must comply with the Confidentiality Agreement; and it must provide samples in accordance with the regulations of the Treaty.

An IDA is responsible for:

Keeping the deposit for at least 30 years from the date of deposit and at least 5 years after the most recent request for the furnishing of a sample (whichever is greater).

Informing the applicant when and to whom the sample was sent (if the applicant so requests).

Providing samples to any person authorized, upon written proof of such authorization.

The scenario in Brazil: A brief history

Draft Law No. 305/95 – Provides for access to genetic resources.

Law No. 9,279/96 (in effect since May 14, 1997) – Regulates rights and obligations regarding industrial property.

Resolution No. 196/96 of the National Health Council (CNS) [Conselho Nacional de Saúde] – Establishes guidelines and regulations for research involving human subjects.

Law No. 9,456/97 – Establishes the Plant Variety Protection Act and other provisions.

Decree No. 2,553/98 – Regulates Articles 75 and 88-93 of Law No. 9,279/96 dated May 14, 1996 establishing rights and obligations relating to Industrial Property.

Ordinance No. 88/98, from the Ministry of Science and Technology – Establishes guidelines and standards for compensating public employees for economic gains resulting from intellectual property, protected by intellectual property rights.

Biotechnology patent law in Brazil

Articles eligible for protection in biotechnology are: biological material per se, a method or process of obtaining biological material, industrial products obtained by an industrial process that uses biological material, and industrial products that incorporate biological material.

The types of inventions encompassing organic products include: amino acids, peptides, proteins, enzymes, nucleotides (RNA and DNA), plasmids, vectors, monoclonal antibodies, transgenic microorganisms (bacteria, fungi, viruses, and yeasts), hybridomas, transgenic seeds, medicines, vaccines and cosmetics.

The Industrial Property Law (No. 9,279/96) brought the following changes:

Extends patentability to pharmaceutical processes and products, and foods and chemicals.

Explicitly accepts the patentability of microorganisms modified by human intervention, provided that they satisfy the basic requirements of patents: novelty, inventive step and capability of industrial application.

Does not allow the patenting of any other living thing: plants must be protected by the New Plant Variety Act, and animals, even transgenic ones, are excluded from patent protection.

Changes the way industrial design registrations are granted, extending their term of protection to 25 years, and establishing summary procedures for granting them.

Prioritizes local manufacturing, without impeding importation (by the owner and third parties), if local production is economically unfeasible.

Extends the patent protection term from 15 years to 20 years, for invention patents, and from 10 years to 15 years for utility models (from the date of deposit).

Allows use, without compensation to the owner, of the patented article for conducting nonprofit research.

Introduces a grace period, where the inventor may disclose an invention within a certain period (e.g., by publication), even before filing a patent application with INPI, without affecting novelty.

Extends to employees of public research institutions the possibility of receiving a share of financial benefits received from the marketing of inventions developed under their employment contract.

Introduces the offer of an internal priority license, a device that favors the national inventor.

In the case of patents on living matter, there are special rules. According to Article 10, Section IX of Law No. of 9,279, “all or part of natural living beings and biological materials found in nature or isolated therefrom, including the genome or germplasm, of any natural living being and the natural biological processes” are not considered an invention or utility model. Also, “all or part of living beings are not considered patentable, except those microorganisms meeting the three patentability requirements – novelty, inventive step and capability of industrial application – provided for in Article 8 and which are not mere discoveries” (Article 18, Section III). Article 18, Section III, also excludes from patentability those whose tissues are capable of forming tissues and therefore organs.

Examples

Animals

Plants

Germ cell lineage

Any part of a plant which can represent the indirect patenting of the whole

Egg cell (regeneration of the whole animal)

A cell or part of a plant with the capacity to generate a new plant

Animal organs

Germ cells (egg, egg cell, embryo, seed, embryo culture)

Article 24 of Law No. 9,279 (sole paragraph) deals with the clarity of the patent document: “In the case of biological material, which is essential for the practical application of the object to which the patent claim is being directed, and which can not be described in this article and which is not accessible to the public, the report shall be supplemented by a deposit of material in an institution authorized by INPI or indicated in an international agreement.”

According to subsection 16.1.1 of item 16 of Regulatory Act No. 127 dated May 3, 1997 for Law No. 9,279 (hereinafter the IPL), which provides for specific provisions in the area of biotechnology, “under the circumstances described in Article 24 of the IPL, the deposit of biological material must be made at institutions located in the country, duly authorized by INPI through accreditation.” Thus, only if such institution does not exist under these conditions, “the applicant may make the deposit at any of the international depositary authorities acknowledged by the Budapest Treaty on the International Recognition of the Deposit of Microorganisms for the Purposes of Patent Procedure.”

Also according to Regulatory Act No. 127, subsection 16.1.1.5, “where necessary for the assessment of the technical characteristics of the biological material, INPI may stipulate requirements based on technical analysis and verification of such material in situ.”

Item 16.2 (and its sub-items of Regulatory Act No. 127) concern the specification, providing that the description in the application, in addition to the specifications required in item 15 (which specifies the format of the document for the initial and final application), must contain “the essential properties of the living material necessary for its complete description, according to the technologies inherent in the subject matter considered relevant for its complete characterization.” Thus, certain common points must be specified for all organisms, such as states of growth in the appropriate media and physiological properties. In addition, certain more specific traits for each group must also be indicated. For example, in the case of yeast, it must be specified whether there is formation of ascospores and “assimilation of more than fifteen carbon sources.” For bacteria, it must be specified, among other traits, whether there are other properties required for being characterized as a new species, such as: “gluconic acid oxidation, decomposition of cellulose, decomposition of ethanol, hemolysis, coagulases or lipases.” For algae, the formation of stabilizing agents must be specified (alginates, agar, carrageenan). In protozoa, information regarding pathogenicity (life cycles, host range) must be specified. For viruses, the development of infections and pathogenicity must also be reported (DNA or RNA viral diseases).

Regulatory Act No. 127, item 16.3 further states: “every patent application that describes a sequence of nucleotides or amino acids must contain – in addition to the specification, the claims, the drawings and the abstract – a separate section named Sequence Listing, immediately after the claims.”

The biological sequence listing must contain:

A request describing sequences of nucleotides or amino acids.

General information about the patent application (item 16.3.1.2.1).

General information about the sequence (item 16.3.1.2.2).

All sequences or parts of sequences described in the application, separately identified by an identification number (item 16.3.1.2.3).

Descriptive report, claims and abstract. When making reference to the sequence listing, the identifying number must be used (item 16.3.1.3).

Base numbering starts at the first base of the sequence, with the number 1 and continues in sequence in the 5’ to 3’ direction (item 16.3.4.9).

At the end of each line that contains the list of bases, on the right margin, the number corresponding to the last base of that line must appear (paragraph 16.3.4.10).

Numbering of corresponding amino acids in a sequence of nucleotides starts at the first amino acid protein, with the number 1; pre-sequences and signal sequences, when present, should have negative numbers, counting backwards, starting with amino acid number 1 (item 16.3.4.11).

In a nucleotide sequence, the non-coding part (including introns) shall be listed in groups of 10 bases (item 16.3.4.6).

In a sequence of nucleotides, the coding part should be listed in triplets (codons) (item 16.3.4.7).

The nucleotide sequences must be submitted in letter code for nucleotide bases, as specified in Table 3.

“The amino acids corresponding to the codons of the sequence must be presented immediately below the corresponding codon” (item 16.3.4.4).

“The amino acids in a sequence shall be listed in the direction from N-terminus to Cterminus, using the three letter code, with the first letter uppercase (item 16.3.4.5), as shown in Table 4.”

Table 3. Presentation of nucleotide sequences.

Code

Meaning

A

Adenine

C

Cytosine

G

Guanine

T

Thymine

U

Uracil

M

A or C

R

A or G

W

A or T/U

S

C or G

E

C or T/U

K

G or T/U

V

A or C or G, not T/U

H

A or C or T/U; not G

D

A or G or T/U; not C

B

C or G or T/U; not A

N

A or C or G or T/U or unknown

Table 4. Presentation of amino acid sequences.

Code

Amino Acid

Ala

Alanine

Arg

Arginine

Ars

Asparagine

Asp

Aspartic acid

Asx

Aspartic acid ou asparagine

Ces

Cysteine

Glu

Glutamic acid

Gln

Glutamine

Glx

Glutamine or Glutamic acid

Gle

Glycine

His

Histidine

He

Isoleucine

Leu

Leucine

Les

Lysine

Met

Methionine

Phe

Phenylalanine

Pro

Proline

Ser

Serine

Thr

Threonine

Trp

Tryptophan

Ter

Tyrosine

Val

Valine

Xaa

Unknown or other

“The sequence of nucleotides must be listed with a maximum of 16 codons or 60 bases per line, while the amino acid sequence must contain 16 amino acids per line” (items 16.3.4.8 and 16.3.4.12).

The use or commercialization of a patented product that has been placed legally in the market by the owner or his licensee shall not be considered patent infringement provided it is not used for commercial multiplication or propagation of patented living matter (Law No. 9,279, Article 43, Section VI).

Regulatory Act No. 127, item 4.16 further provides for Access to Biological Material: “The biological material that supplements the specification of the patent application, in accordance with the sole paragraph of Article 24 of the IPL, shall be made publicly accessible to technically skilled persons on the date of publication of the application” (paragraph 16.4.1). “The person or entity filing the application or the patent owner shall not be able to prevent or hinder access, except when able to prove the existence of reasons of a technical or legal nature” (item 16.4.1.1). “In the event provided in the preceding item, INPI shall take the necessary steps to reach a decision concerning the reasons claimed by the applicant or owner for preventing access to the biological material” (item 16.4.1.1.1). “Should INPI decide against the claim of the applicant or owner, the same shall be served notice to, within 60 (sixty) days, take such applicable measures as may be required to make the biological material available” (item 16.4.1.1.2).

Plant Variety Protection Act

Law No. 9,456 dated April 25, 1997 establishes Plant Variety Protection. For a protected plant variety, users must return part of profits earned from its use to those who bred it, so that society is always the beneficiary of technological advancement.

A “plant variety” means “a variety of any plant genus or species that is clearly distinguishable from other known plant varieties by a minimum margin of descriptors and by its own denomination, is homogenous and stable in its descriptors throughout successive generations and belongs to a species useful in farming and forestry, being described in a publicly available and accessible specialized publication, including the component lines of hybrids.” A “breeder” is “the individual who breeds a plant variety and establishes descriptors (morphological, physiological, biochemical or molecular characteristics that are genetically inherited and used to identify the plant variety) that differentiate it from any other.”

Along with the aforementioned law, the National Plant Varieties Protection Service (SNPC) [Serviço Nacional de Proteção de Cultivares] was created, under the Ministry of Agriculture, Livestock and Food Supply (MAPA) [Ministério da Agricultura, Pecuária e Abastecimento], as the body in charge of protecting plant varieties in the country, and which is responsible for processing all steps involved in obtaining legal protection of new varieties and essentially derived plant varieties – from preparing and submitting documents for approval by the Ministry of Agriculture, Livestock and Supply and publishing the extracts of applications for protection in the Brazil’s Federal Official Gazette [Diário Oficial da União (D.O.U.)] and in specialized journals, to determining the performance of field trials and laboratory tests for the differentiation of the plant variety when deemed necessary and finalizing compliance with the laws pertaining to protection and the right to protection.

The National Plant Variety Protection Commission (CNPC) [Comissão Nacional de Proteção de Cultivares] was created, which serves the SNPC a consultative and advisory capacity. It mainly has the following functions: suggesting rules and regulations on the protection of plant varieties and advising the SNPC on matters relating to the protection of plant varieties, particularly on national conventions and agreements.

In general, Brazil’s legal structure for plant varieties and breeder’s rights is one of the best such structures in the world, including two important provisions which have been highlighted by the director of the Brazilian Association of Seeds (ABRASSEM) [Associação Brasileira de Sementes], Claudio Manuel da Silva (SILVA, 1997):

National institutions, whether in the public or private sphere, have been properly preserved, protecting their rights, even for already created plant varieties. This means that if a company wishes to introduce a trait in a transgenic plant variety has already been sold commercially for up to 10 years in Brazil, it must obtain the appropriate license from the breeder.

Any manufacturer may use seeds of a protected new plant variety, without paying any kind of fee or royalty, for their own use as food or industrial raw material. But they are not allowed to commercially produce seeds.

In addition, all plant varieties which were already known and commercialized in Brazil before July 1996 are public domain and may be used by any farmer, even for seed production.

Intellectual property and research institutes

For the purposes of characterizing the intellectual property situation in Brazil, an analysis makes it possible to conclude that this issue is not a priority in most education and research institutions.

Some factors common to education and research institutions, such the ones listed below, make it possible to identify the major deficiencies giving rise to this lack of a patent culture:

Lack of an organized culture to deal in depth with issues of intellectual property and technological innovation.

Lack of a culture that values intellectual property.

Lack of a tradition in the areas of science and technology to raise awareness among Brazilian researchers regarding using patents to legally protect new methods, processes and products developed in their research and teaching institutions.

Lack of awareness, on the part of most research institutions and universities, of the industrial property system and its implications in the process of technological and national development.

In turn, an Intellectual Property Policy would provide some institutional mechanisms which would facilitate it being understood and applied as a return on investments made in research and development (R&D) and a leveraging of institutional competitiveness. Some activities that could guide the routine for patent applications are listed below:

Monitoring technological capabilities.

Planning and controlling research budgets.

Establishing rights to publish the results (the domain of technology information generated).

Properly formalizing scientific and technological cooperation (rights and obligations of each party / providing for the exploitation of results).

Developing strategies to search for partnerships and knowledge about markets and industries of interest.

Establishing instruments for encouraging innovation.

Establishing indicators for assessing research (patent as an indicator).

Regulating the entry of visiting researchers, students, trainees and students in national and international institutions.

Guiding the placement of researchers from the institution for training in another country (restrictive terms as to ownership of the results).

Developing tools for continuous information on the patent system.

These laws will facilitate establishing strategic alliances in the fields of production and technology (innovation and research networks, joint ventures), and in funding. Here in Brazil, unlike what occurs in developed countries, most public institutions do not provide adequate patent protection to inventions generated in their laboratories. Several of them still lack clear rules on how to proceed with claims for privileges and benefit sharing. This situation becomes worse when private companies are partners of the projects, leading the companies to lose interest in new partnerships with the public sector (MOREIRA FILHO, 1998).

In Brazil, in the case of the absence of a specific contract between employee and company, the employee should seek support from one or more of the following institutions:

National regulations on the matter.

Regulations of the universities.

Statutes of the universities.

Laws governing contracts in the country.

Some universities in Brazil, such as the University of São Paulo (USP) have agreements with their teachers and researchers, giving half the ownership of patents to researchers and the other half to the university, which, in turn, also returns a part of its 50% of the inventor’s research center.

In general, there is some negligence on the part of universities and research centers to clarify to the researcher the principles of patent law and the encouragement of patenting, which may cause the researcher to give more importance to the scientific publication of the work rather than to the patent, which often leads to loss of the rights to the patent.

Patents reward inventive effort with a return on investment to the university and to the researcher. Publishing without a patent only communicates the inventive effort, without financial return. The patent is automatically published 18 months after the filing of the application, but the researcher can have the information published, after filing the application, whenever they see fit, either in specialized scientific journals, or in lectures or papers. Therefore, the patent does not prevent publication; on the contrary, it requires publication. Again, the researcher, after describing the invention and depositing it at Brazil’s National Institute of Industrial Property (INPI), may make it available for publication immediately. The following outlines specific steps that a research on an invention should follow (WOLFF, 1998):

Written description of the invention.

Filing of this description with Brazil’s INPI.

Publication by the researcher, for the scientific community.

Publication required by INPI, 18 months after filing.

Thus, to alert researchers about the importance of patenting, it is necessary to explain to them the principles of patent law and give them incentives to use patents by letting them participate in royalties. It is worth mentioning that these incentives could come from development agencies themselves, through special funds to help pay patent application costs, raised from the projects they have sponsored, including the hiring of specialized offices.

Chapter 3
Intellectual property protection in Paraguay

Introduction

Industrial property in Paraguay is protected by Law No. 1,630, on Invention Patents48. This law protects inventions, giving two types of industrial property rights: invention patents and utility model patents. Its enforcement agency is the Directorate of Intellectual Property (DPI) [Dirección General de Propiedad Intelectual] of the Ministry of Industry and Commerce (MIC) [Ministerio de Industria y Comercio]. In the same context of industrial property, trademarks are regulated by Law No 1,29449. In the field of agricultural production, breeder’s rights are protected by Law No. 385, on Seeds and Protection of Plant Varieties50. Paraguay has been a signatory to the UPOV Convention since 1995 (ALVAREZ, 2000).

Invention patent law

Patentability

Inventions of new products or procedures that involve an inventive step and are capable of industrial application shall be patentable.

The following shall not be considered inventions:

Simple discoveries, scientific theories and mathematical methods.

Purely aesthetic creations.

Methods, schemes, plans, and principles for economics, business, advertising, and publicity, and methods relating to purely mental or intellectual activities, or in the area of games.

Computer programs considered in isolation.

Methods of diagnosis, therapy, or surgical treatment of people and animals.

Different ways of reproducing information.

The following are excluded from patent protection:

Inventions whose commercial exploitation must necessarily be prevented to protect public order or morals, to protect health and life or to preserve animals and plants and to prevent serious harm to the environment.

Plants and animals, other than microorganisms, and essentially biological procedures for the production of plants or animals, other than non-biological or microbiological procedures.

Also, products or procedures included in the state of the art, as set forth in this law, may not be the subject of a new patent by virtue of being assigned a different use than the one described in the initial patent.

Ownership of rights

The inventor or his heirs are entitled to obtain a patent. The applicant for a patent may be an individual or corporation, domestic or foreign.

Ownership of rights in the context of an employment contract

When an invention has been made in pursuance or execution of a work or service contract, or an employment contract, the person who commissioned the work or service, or the employer, shall be entitled to obtain a patent, as applicable, unless the contract specifies otherwise.

When an employee who is not bound by an employment contract to exercise inventive activities makes an invention within the field of activities of their employer, or by using data or means to which they have access by virtue of their employment, they must give written notice of this fact to their employer. If the employer has an interest in the invention, they must notify the employee of this in writing and, in this case, the right to obtain a patent shall be accorded to the employer from the start. The employee shall be entitled to an equitable compensation taking into account the estimated economic value of the invention. Such compensation is irrevocable. In all cases, the inventor shall be entitled to be recognized as the creator of the invention and mentioned as such in the patent. Any agreement shall be void by which the inventor, before having made the invention, waives any of their previously mentioned rights pertaining to the invention.

Term of protection

A patent on an invention shall have a non-renewable term of 20 years from the date of filing the application in the country.

Patents on microorganisms

When the invention pertains to a product or procedure relating to any biological material that is not publicly available and cannot be described so that the invention can be performed by a person having ordinary skill in the art, the description must be supplemented by the deposit of the material at a depositary institution recognized by the Directorate of Industrial Property (DGPI) [Dirección General de la Propiedad Intelectual]. Such deposit shall not be required if a deposit has been made in some WTO member country, or if proof of novelty has been performed by the authority of such countries.

Rights conferred

A patent gives its owner the exclusive rights to exploit the invention.

Exceptions to the rights protected

The patent does not give the right to prevent:

Acts performed exclusively for purposes of experimentation and non-commercial use.

Acts performed exclusively for teaching or scientific or academic research.

Acts of trade conducted by a third party in relation to a product protected by the patent after it has been lawfully introduced into commerce in any country.

Use of the invention until 30 days prior to expiration of the patent for experimental purposes and in order to gather information required for approval of a product by the responsible authority, for marketing after the patent expires.

Acts done by a person who in good faith and prior to the patent application filing date or, in the case of a priority patent, the application filing date of the corresponding priority patent, was already in the country producing or publicly using the procedure which constitutes the invention, or who had already made preparations for such production or use.

Licenses

The patent owner or applicant may grant a license for the exploitation of the invention, which shall have legal effects on third parties, after it has been filed at DGPI. The licensee may not transfer the license or grant sublicenses. The license is not exclusive; the licensor may grant other licenses for exploitation in the country, as well as exploit it himself in the country. If exclusivity has been granted, the licensor may not perform exploitation on its own in the country.

Compulsory licenses and other uses without permission of the owner

Compulsory licensing or other uses without the authorization of the patent owner due to reasons of public interest: For reasons of health emergency, defense, national security, socio-economic and technological development of certain strategic sectors, as well as when exceptional circumstances may affect the national interest, the Executive branch may grant compulsory licenses or other uses without the authorization of the patent owner, whose scope and duration shall be determined in the respective decree.

Compulsory licenses and other uses without permission of the owner due to anti-competitive practices: Compulsory licenses in respect of an invention patent may be granted when the competent authority, using a procedure that gives the owner the right to defense and other guarantees, has determined that the owner has practiced anti-competitive activities, abuse of the rights conferred by the patent or abuse of dominant market position.

Anti-competitive practices shall be understood to include the following situations: (a) setting excessively high prices of the patented product in comparison of the average in the international market; (b) existence of offers to supply the market at prices significantly below those offered by the patent owner; (c) refusal to adequately and regularly supply the local market with the raw materials or patented product on reasonable commercial terms; (d) when the efficient exploitation in the country of a patented invention that contributes to technological development is prevented or impeded by the patent owner; (e) other cases covered by special laws.

When the application is submitted by technology industry sectors that did not enjoy protection in the country at the time the law went into effect, and when the pending patent comprises the raw material from which the final product is developed, the licensee is required to purchase such raw materials, molecule or ingredient from the patent owner or from such party as designated by him. The price shall the same as what they offer in the international market. If there is a preferential price for affiliates, the patent owner must offer the licensee the same price.

Compulsory licenses due to lack of exploitation: Any interested party may request a compulsory license, three years after the grant of the patent or four years from date of filing the application if the invention has not been exploited or if effective and serious preparations for such purposes have not been carried out, or even when exploitation has been interrupted for a period exceeding one year, provided that such lack of exploitation is not attributable to force majeure, which shall be considered to include, in addition to situations recognized as such by law, objective difficulties of a legal-technical nature beyond the control of the patent owner which make it impossible to exploit the invention. Lack of technical or economic resources, or lack of economic feasibility of exploitation, when beyond the control of the patent owner, should also be recognized.

Other compulsory licenses and uses without permission of the owner: When a potential user has attempted to obtain the grant of a license from a patent owner on reasonable commercial terms and conditions and such attempts have not been effective after an elapsed period of 90 days from the date on which the license was applied for, the Directorate of Industrial Property (DGPI) may allow other uses without the owner’s authorization.

Remuneration to the owner in case of compulsory licenses

The owner of a patent which has been subject to compulsory license shall receive adequate compensation in accordance with the circumstances of the case, the economic value of the license and the average license fees in the given sector in commercial license agreements between independent parties. If agreement cannot be reached, the amount and form of payment of compensation shall be set by the administrative authority. The applicant for an obligatory license must demonstrate the technical and financial capabilities to carry out the exploitation. A compulsory license cannot be granted on an exclusive basis, cannot be subject to assignment or sublicense, and can only be transferred along with the company or establishment or part of same which is exploiting the license. Licenses shall be granted mainly to supply the domestic market.

Dependent patents

A compulsory license shall be granted to allow the exploitation of a new patent (“the second patent”) that can not be exploited without infringing another patent (“the first patent”), provided that the following conditions are met:

The invention claimed in the second patent must involve an important technical advance in relation to the invention claimed in the first patent.

The first patent owner must have the right to cross-license on reasonable terms to use the invention claimed in the second patent.

The use granted by the first patent first cannot be assigned without cancelling the second patent.

Records and disclosure

After a period 18 months, counted from the date of filing of the patent application or of the priority patent application if a right of priority has been invoked, the DGPI shall proceed to make the application public and order its publication. The DGPI shall enter in the corresponding registry and publish in its official public record the resolutions and decisions regarding the granting of patents and compulsory licenses and the revocation, annulment or cancellation of patents.

Confidentiality

Every patent application shall be kept secret until its publication. This confidentiality also applies to any application which was withdrawn or abandoned before its publication.

Foreign patents

For the purpose of verifying compliance with patentability requirements, the applicant shall submit to the Directorate of Intellectual Property (DGPI), together with their corresponding translation, the following documents for foreign applications for the same invention being claimed: a copy of the application and the accompanying documents, a copy of the results of novelty tests performed and a copy of the patent or title of protection which has been granted.

Transitional arrangements

In accordance with Article 65 of TRIPS on Transitional Arrangements, the current law entered into force for pharmaceutical products, as of January 1, 2003. Applications for patents for these products filed since January 1, 1995, directed to new products, processes or procedures with respect to the state of the art, and having capacity for industrial application, shall be handled in accordance with the requirements and the provisions of law. The duration of patents so granted shall be that resulting from applying the established provisions regarding duration of the patent.

Utility models51

A utility model is an invention consisting of a shape, configuration or arrangement of components of an artifact, tool, instrument, mechanism or other object, or some part of them, allowing better or different operation, use or manufacture of the object which incorporates it, or providing some assistance or technical effect that it did not previously have. These shall be protected by patenting.

The terms in Chapter 8 on general provisions regarding invention patents are also applied to utility model patents, subject to the special provisions contained in the present section. A utility model shall be protected when it is capable of industrial application and has novelty. It shall not be considered novel when it presents only minor or secondary differences that do not add any utilitarian characteristic discernible in the state of the art.

The following cannot be the subject of a utility model patent: (a) procedures; (b) substances or chemical or metallurgical compositions, or of any other type; (c) matter excluded from patent protection for inventions in accordance with this law.

Trademarks52

In Paraguay, trademarks are protected by Law No. 1,294. Under this law, trademarks are any signs which serve to distinguish goods or services. Trademarks may consist of one or more words, slogans, emblems, monograms, stamps, cartoons, embossed designs, names, invented words, letters and numbers with distinctive shapes or combination, or distinct combinations and arrangements of colors, labels, and containers. Trademarks may also include the shape, presentation or treatment of products or their containers or wrappers, or the means or place of sale of the products or services in question.

The registration of a trademark gives its owner the right to exclusive use of the mark, and the right to bring any actions and measures before the proper authorities regarding infringement of those rights. It also grants the right to object to the registration and use of any other sign that could directly or indirectly induce confusion or association between products or services which relate to each other. The owner of a trademark for products or services registered abroad shall enjoy the guarantees that this law grants, once the mark has been registered in the country. The owner or his authorized agents are the only individuals entitled to apply for registration. The registration of a trademark is valid for 10 years and may be extended indefinitely, for the same duration.

Directorate of Intellectual Property (DGPI)53

The Directorate of Intellectual Property (DGPI) [Dirección General de Propiedad Intelectual] of Paraguay’s Ministry of Industry and Commerce (MIC) [Ministerio de Industria y Comercio] is the competent authority having administrative jurisdiction in matters of patents and trademarks. The DGPI is headed by the person designated by the Executive branch, nominated by the MIC.

The DGPI shall publish an official bulletin which shall include the judicial acts required by this law, registrations granted and their renewals, as well as resolutions and final judicial decisions related to the revocation, annulment or cancellation of any registration. The Director of the DGPI must be a citizen of Paraguay, older than 30 years, a lawyer and person of recognized moral repute. This person may not perform other paid activity, except for teaching.

Protection of plant varieties

The Law on Seeds and the Protection of Plant Varieties has the following objectives:

To promote efficient activity in obtaining plant varieties, and in the production, circulation, commercialization and quality control of seeds.

To ensure the identity and quality of all seeds purchased by farmers and general users.

To protect the rights of breeders of new plant varieties, in harmony with intra-regional agreements signed or to be signed, and with the international regulations on seeds.

Requirements for protection

Protected plant varieties must meet the following requirements:

Distinctness: The plant variety must be clearly distinct from any other, through one or more phenotypic or genotypic traits, whose existence on the date of filing is well known.

Homogeneity: The plant variety must be sufficiently uniform in its relevant traits, taking into account expected variation due to the particularities of sexual reproduction or vegetative propagation.

Stability: The traits belonging to the plant variety must remain unchanged over successive generations or, in the case of a particular cycle of reproduction or multiplication, at the end of each cycle.

Novelty: A variety shall not be considered novel for the purposes of this law if, prior to filing the application for registration, it has been sold or given to others by the breeder or with his consent within the national territory, or if, within the territory of another State, it has been delivered or given to others by the breeder or with his consent, for more than six years prior to filing the registration application in the case of vines, forest trees, fruit trees and ornamental trees, or more than 4 years for other species.

The varieties of the following species are protected by this law: cotton, rice, canola, sunflower, corn, soybeans, sorghum and wheat. Species not mentioned may be included in the registry by resolution of Paraguay’s Ministry of Agriculture and Livestock (MAG) [Ministerio de Agricultura y Ganadería], upon proposal by the Directorate of Seeds (DS) [Dirección de Semillas], with a previous report to the Technical Committee for Qualifying Plant Varieties, and as required for the needs of domestic agriculture.

Scope of protection

The breeder’s right consists in submitting production and marketing of seeds of the protected variety to prior authorization from the breeder, except as provided in Article 37. The authorization granted by the breeder must be communicated by him to the Directorate of Seeds. At the Directorate of Seeds, the National Registry of Protected Plants is established, in order to safeguard the breeder’s rights.

Exceptions to the rights protected

The protection of a plant variety does not prevent other people from using it for experimental purposes or for creating a new plant variety, which can be inscribed with the name of its breeder, without the consent of the breeder of the original plant variety that was used to obtain it, and provided that the original plant variety is not permanently used to produce the new one.

The breeder’s right is not harmed by a farmer who plants and saves seeds of a protected plant for their own use, or who uses or sells, as raw material or as food, the product of that plant variety.

Restrictions on the exercise of rights protected

The Ministry of Agriculture and Livestock, upon proposal by the Directorate of Seeds and prior finding by the National Seeds Council, may declare a protected plant variety to be of “restricted public use,” if it decides that such resolution is necessary to ensure an adequate supply of seeds and that the breeder is not satisfactorily supplying public needs. The proposal must indicate the term of the declaration of restricted public use. If need be, the extension of the term shall specified by a new resolution, according to the procedure in the relevant article.

During the period in which the declaration of restricted public use is in force, the Directorate of may grant the right to produce the seeds of the corresponding plant variety to individuals or companies listed in the National Registry of Seed Producers, which is referred to in Article 44. In this case, the breeder of the plant variety shall receive a compensation from the seed producer, and the Directorate of Seeds may participate as a mediator for such purposes.

Term of protection

The title of the breeder shall be valid for 15 to 20 years, depending on the species or species group, and in accordance with the provisions of the regulations. The title must include the dates of issuance and expiration.

National treatment and right of priority

Plant varieties of foreign origin may be entered in the National Registry of Protected Plants with the title of breeder in effect in the country of origin. To this end, foreign breeders shall enjoy the same rights as nationals, in regard to the recognition and protection of the breeder’s rights upon fulfillment of the requirements and provisions established by law. The application for registration of plant varieties from other countries must be filed by the legal representative of the person, having permanent residence in the country and sponsored by an agronomist or forestry engineer, whose title is inscribed in the National Registry of Agronomists and Forestry Engineers.

Revocation or termination of the rights protected

The breeder’s right shall be declared void if it is proved that at the time of grant of the right:

The conditions set forth in Article 12, paragraph (a) and in Article 25 of this law were not effectively complied with.

The conditions set forth in Article 12, paragraphs (b) and (c) were not effectively complied with, if the grant of the breeder’s right was based solely upon information and documents provided by the applicant.

Directorate of Seeds

The Ministry of Agriculture and Livestock is the competent authority in matters of seeds. It monitors compliance with the provisions of the law and enforces them through its technical body, the Directorate of Seeds. The Directorate of Seeds performs the following functions:

Developing and/or proposing plans and programs to help improve domestic production of seeds.

Providing guidance and technical assistance to seed growers.

Controlling the production and trade of seeds.

Certifying seeds in accordance with national standards and/or international bodies to which the country has acceded.

Stimulating the breeding of improved varieties and production and marketing of varieties.

Maintaining national registries of commercial plant varieties and protected plant varieties.

Proposing to the Ministry of Agriculture and Livestock breeder’s titles, their termination or cancellation, if applicable.

Chapter 4
Protection of intellectual property in Uruguay

General framework of intellectual property protection

Article 7 of Uruguay’s Constitution enshrines the general protection of the rights of all its inhabitants to enjoy their work and property, among other rights, of which no one can be deprived, except according to laws that are established for reasons of general interest. Article 32 defines “property” as an inviolable right and restricts the cases in which someone can be deprived of it, for reasons of necessity or public utility established by law and always with fair and prior compensation (ALDABALDE, 1998ab).

Article 36 provides that “every person can devote themselves to work, farming, industry, trade, profession or any other lawful activity, except limitations in the public interest established by law.” The relevant rights are protected in a generic way by Article 33 of the Constitution, which states that “intellectual work, the rights of the author, inventor or artist shall be recognized and protected by law.”

Patent law for inventions, utility models and industrial designs

Law No. 17,164 gathers in a single body of law all provisions governing Invention Patents, Utility Models and Industrial Designs, repealing Law No. 10,089 and Decree-Law No. 14,54954. Property rights arising from inventions, utility models and industrial designs shall be protected by patents, which shall be credited with the corresponding titles. The author shall be mentioned as such in the patent granted, and in publications and official documents related to it, except in the case of express written waiver.

Domestic or foreign individuals or entities may be patent owners. The regulations on national treatment and the right of priority, established in the international agreements ratified by the country in regard to patents, shall apply on equal terms to nationals who are party to those agreements and persons connected with them. In cases of lack of international agreement, foreign nationals have the same rights as nationals. Enforcement of provisions may be limited in cases involving nationals of countries that do not grant adequate reciprocity.

Patentability

New inventions of products or procedures are patentable if they represent an inventive step and are capable of industrial application. The invention shall be considered novel if it is not found in prior art, understanding this to be the set of technical knowledge made public before the date of filing the patent application, or in the case of priority, through an oral or written description, or through exploitation, or by any other means of dissemination or communication in the country in such a away that enables it to be executed. An “inventive step” is assumed when the invention does not follow in an obvious manner from prior art, for a person having ordinary skill in the art. It is considered capable of industrial application when its object can be used in industry, understood in its widest sense.

Novelty shall not be affected by disclosure of the invention made during the year preceding the date of filing the application or the priority that is being claimed, provided that it derives directly or indirectly from acts performed by the inventor, his heirs or others on the basis of directly or indirectly obtained information.

Items not considered inventions

The following shall not be considered inventions:

Discoveries, scientific theories and mathematical methods.

Plants and animals other than microorganisms and essentially biological procedures for the production of plants or animals, except for non-biological or microbiological procedures.

Schemes, plans, or game rules, or business, accounting, financial, educational, publishing, lottery or supervision methods or principles.

Literary or artistic works, any aesthetic creation and scientific works.

Computer programs considered in isolation.

Different ways of reproducing information.

Biological and genetic material as it exists in nature.

Items not patentable

The following are not patentable:

Diagnostic, therapeutic and surgical methods for treatment of humans or animals.

Inventions contrary to public order, public morality, public health, nutrition, population, safety and the environment.

Ownership of rights

The right to the patent belongs to the inventor or his heirs and can be transferred inter vivos or upon death. If multiple people make the same invention independently, the patent shall be granted to the one who files the first patent application or invokes the earliest priority date for this invention.

Ownership of rights in the context of an employment contract 

When an invention has been made in pursuance of a contract of employment, work or service whose total or partial objective is research activity, the patent right arising from it belongs to the employer, unless otherwise specified. In cases where the employee’s personal contribution to the invention and its importance for the company obviously exceed the explicit or implicit content of the employment relationship, the employee shall be entitled to additional remuneration.

When the worker makes an invention related to his professional activity in the company and is influenced in obtaining the invention predominantly by knowledge or use of facilities provided by this company (if the employee is not required to do research), the employee must communicate this in writing to their employer. If the employer notifies in writing its interest in the invention, the patent right shall belong to them jointly.

Inventions made during a working relationship not included in the previous articles belong exclusively to their author. Any contractual provision less favorable than those provided to the inventor shall be void.

Periods of protection

An invention patent has a term of 20 years, counted from the date of application. Models and drawings have a period of 10 years from the date of application, subject to renewal for five years.

Patents on microorganisms

For applications related to microorganisms, the deposit of biological material necessary for the description of the object shall be performed at institutions authorized by the National Directorate of Industrial Property of the Ministry of Industry, Energy and Mining (MIEM) [Ministerio de Industria, Energía y Minería], until ratification of international conventions on the matter.

Rights conferred

A patent gives its owner the right to prevent third parties from performing, without the owner’s authorization, any of the following acts:

If the patent was granted for a product: to manufacture it, offer it for sale, sell it or use it, import it or store it for any of these purposes.

If the patent was granted for a specific type of procedure: to use it as well as perform any of the acts listed in item (a) with respect to products obtained by means of that procedure.

Exceptions to the rights protected

The rights conferred by a patent do not cover the following acts:

Acts performed in the private sphere and for non-industrial or non-commercial purposes, provided they do not cause an economic loss to the patent owner.

The preparation of a medication for an individual patient under a prescription, and prepared under the direction of a qualified professional.

Acts performed solely for purposes of experimentation, including preparation for future commercial exploitation, performed in the period of one year preceding the expiration date.

Acts executed for teaching or scientific or academic research.

Importation or introduction of small quantities of goods not commercial in nature, forming part of the baggage of travelers or sent in small packages.

The patent owner cannot prevent acts which are performed, including those without disclosure, by third parties in good faith, who as of the date of filing or priority as the case may be, are already manufacturing in the country the product or procedure which is the subject of the invention, or who have made serious preparations to carry out manufacture, use or exploitation. Such acts may be continued in order to meet the needs of the company, as corresponding to those needs and the products obtained.

Inventions encompassed by monopolies granted in favor of the State or individuals are patentable. Their industrial or commercial exploitation can be accomplished only with the consent of the holder of the monopoly or after its expiration. Rights to an application filed or a patent granted may be expropriated by the State in accordance with relevant regulations. Expropriation may be limited to the right to use the application or patent for the needs of the State.

Licenses

The patent owner or applicant may grant licenses for the exploitation of the patented item, which shall become effective against third parties, as of the entry of such licenses at the corresponding registry. The following regulations shall apply:

The license shall be extended to all acts of exploitation or commercialization of the patented item during its entire term, throughout the country and with respect to any application of said item.

The licensee may not assign or transfer their license or grant sublicenses.

The license shall not be exclusive; the licensor may grant other licenses for exploitation of the patent in the country or exploit it for themselves.

Without prejudice to the powers granted by the owner and given the lack of initiative, the licensee may adopt measures to protect the patent.

It is prohibited to establish, in contractual licenses, covenants or conditions that produce a negative effect on competition, constitute unfair competition, or make possible an abuse by the patent owner or its dominant market position.

Offer of license

The owner of an invention patent who resides in the country may authorize the exploitation of the patent to any person who demonstrates the technical and economic suitability to perform it efficiently. The patent on offer shall have its annual fees reduced by half. The offer shall be governed by conventional regulations regarding licenses. In case of lack of agreement on the remuneration for the license, any party may invoke the procedure provided in Articles 74 and 75 of Law No. 17,164.

Compulsory licenses and other uses without the permission of the patent owner

Due to lack of exploitation of the patent: Any interested person may request a compulsory license, once three years have passed since the granting of the patent, or 4 years since the date the application was filed, whichever term is later, if the invention has not been exploited or effective and serious preparations for that purpose have not been made or if the operation has been interrupted for more than one year, provided there has been no circumstances of force majeure.

The exploitation of a patent includes making, using, importing and any other type of commercial activity performed in relation to the patented item. For these purposes, the exploitation of the patent held by a representative or licensee shall be deemed as being performed by the owner. In addition to those circumstances generally recognized by law, objective difficulties of a technical and legal nature shall be considered force majeure, such as the delay of public bodies to issue permits, beyond the control of the patent owner and which make it impossible to exploit the item.

Due to reasons of public interest: In special situations that may affect the public interest, defense or national security, economic, social and technological development of certain strategic sectors for the country, as well as health emergencies or other similar circumstances of public interest, the Executive branch, via an express resolution, may grant compulsory licenses or other uses without the authorization of the patent owner, the scope and duration of which must be adequate to the purpose for which they were granted. The right of the patent owner may be limited in circumstances of lack or insufficiency of commercial supply to meet the needs of the market.

Due to anti-competitive practices: The National Directorate of Industrial Property, via an express resolution, may grant compulsory licensing of a patent if the competent authority, by means of an administrative or judicial proceeding that gives the owner the right to defense and other guarantees, has determined that the owner has engaged in anti-competitive practices, or abuse of the rights conferred by the patent or of its market dominance. The situations indicated may include the following:

Pricing which is comparatively excessive when compared to the international market for the patented product.

The existence of offers to supply the market at prices significantly below those offered by the patent owner.

Inability to adequately and regularly supply local markets with raw materials or the patented product on reasonable commercial terms.

Hindrance or harm to business or production activities in the country.

Acts which unreasonably restrict trade or which result hindrance of technology transfer.

Once more than two years have passed since the granting of the first compulsory license or other uses, due to reasons of anti-competitive practices or abuse of the rights conferred by the patent, if the patent owner again engages in these acts or in practices giving rise to the unlawful acts, the patent right may be revoked.

Other compulsory licenses and other uses without permission of the owner

Any interested person may obtain a compulsory license or other uses without permission of the patent owner, if they have applied for a contractual license from the patent owner, and it has not been acquired on commercially reasonable terms suitable to the country within 90 days following the application. In all cases, the National Directorate of Industrial Property shall grant a compulsory license or other uses without authorization from the owner, if the applicant demonstrates that:

It has the technical and economic capabilities to handle the proposed exploitation. Technical capacity shall be evaluated by the competent authority, according to specific regulations in force in the country and each industry. The term “economic capacity” is understood to mean the capability of fulfilling the obligations which derive from the exploitation to be performed.

It has a corporate structure which allows it to contribute to developing the market for the licensed product on a local scale.

When the patent refers to a raw material from which the applicant desires to develop a final product, the interested party may perform this development themselves or it may be performed by others inside the country, except in cases of the inability to produce it in the country.

When dealing with areas of technology which were not protected at the time the law went into effect, and the where patent comprises raw material from which it is desired to develop a final product, the licensee is obligated to purchase said raw material, molecule or ingredient from the patent owner or from such party as the patent owner may designate, at the same price as the international market, and the patent owner shall be obligated to sell it.

The licensee may acquire the raw material from another provider when this other provider offers a lower price than the price offered by the patent owner in the country. In this case, the licensee must demonstrate that the raw material acquired in this way was placed into lawful trade in the country or abroad, by the patent owner, by a third party lawfully entitled with the patent owner’s consent.

Once a compulsory license has been granted, the patent owner is required to submit all the information needed to exploit the licensed object: technical knowledge, manufacturing protocols, and techniques for analysis and verification. It is also required to authorize the use of patents for components and manufacturing processes related to the licensed patent. A refusal without cause by the patent owner to provide the technical knowledge and technology transfer necessary in order to achieve the desired goal, or failure to sell the raw material when that is the subject of the patent, implies the loss of the patent owner’s rights to royalties.

The patent shall expire when, once two years have passed since granting the first compulsory license, or other uses, without authorization of the owner, it is not possible for the licensee to exploit the object of the license, required for reasons attributable to the patent owner or his contractual licensee.

Dependent patents

When the patented invention or utility model cannot be exploited in the country without infringing a prior patent, the patent owner or a licensee, for any patent they hold, may request the granting of a compulsory license in respect of the other, dependent patent, as needed to exploit it and prevent infringement thereof. When one patent has as its object a product and the other has a process, it shall be considered that there is dependency between the patents for their exploitation.

A license or use without authorization of the owner, whose purpose is to permit the exploitation of a dependent patent, shall be granted under the following conditions:

The invention claimed in the second patent must assume a significant technical advance, which has a considerable economic importance in relation to the invention claimed in the first patent.

The owner of the first patent shall be entitled to obtain a cross-license on reasonable terms to use the invention claimed in the second patent.

The assignment of the authorized use of the first patent shall include that of the second.

The compulsory license and other uses without authorization of the owner may be revoked if any of the following conditions are found to occur:

Lack of exploitation by the licensee, once the time limits for the start have expired, established by the resolution granting the patent, paragraph E of Article 77 of Law No. 17,174.

Engaging in anti-competitive practices or abuse of the right by the licensee.

Breach of the terms of the concession.

Actions and sanctions

The owner of a patent may file actions against parties which engage in acts violating any rights derived from the patent and may also seek compensation for those acts which have been carried out between the publication of the application and the granting of the patent. They may also claim compensation for harmful acts committed since the filing of the application, where the infringer obtains, by any means, knowledge of its contents before publication, taking into account the date of commencement of exploitation. Parties who illegally sell or distribute products shall only be responsible for damages caused when there is evidence that they were aware of the violation.

Anyone who defrauds any of the rights protected by invention patents, utility models or industrial designs shall be punished by 6 months to 3 years in prison. In any case, there shall be confiscation of the objects produced in infringement and the instruments used predominantly for the development, whose fate shall be decided after consultation with the National Directorate of Industrial Property.

Records and disclosure

Patent records are public and can be consulted by anyone interested, using the methods established by regulation. The patent application shall be kept secret until its publication. Applications which are cancelled or abandoned before publication shall also be kept secret. The National Directorate of Industrial Property shall register the acts and contracts for commercial and industrial patents and for those which change, affect or limit the rights emerging therefrom. In particular, records shall be made of:

Conventional licenses, licensing deals, compulsory licensing and other uses without permission from the patent owner and others, contained in Chapter V of Title II of Law No. 17,164, as well as its modifications.

Injunctions, prohibitions to innovate and other acts that affect the use or disposition of patent rights.

Gifts and other rights that limit or affect patent rights.

Once the required formalities and procedures have been performed, the patent application shall be published in the Bulletin of Industrial Property, 18 months from the day following its presentation or the day after the priority date, in this case. Publication may be moved earlier on request by the applicant.

Technology transfer

A register is created for contracts whose purpose is technology transfer, research and development, franchise contracts and the like, which affect third parties, based on the description thereof.

Confidentiality

Any persons who are involved in processing applications for rights covered by this law are required to maintain secrecy regarding the content of the information. Violation shall be considered gross misconduct. Any persons in the National Directorate of Industrial Property who are involved in processing the rights conferred by this law may not act directly or indirectly in any such proceedings, by or on behalf of third parties, until 2 years have passed since the date on which the relationship ended. Failure to comply with the foregoing provision shall be grounds for:

Removal from office, if the person responsible is a civil servant.

Dismissal, the case of a person bound by contract with the National Directorate of Industrial Property.

Fine, if the person is involved before the expiration of the above-mentioned two-year period

Transitional arrangements

Substances, materials or products obtained by chemical means or processes, and food or chemical-pharmaceutical substances, materials and products and medication of any kind may obtain patent protection under the law, when the first patent application was presented in any member country of the World Trade Organization on or after January 1, 1995, and if they are not commercialized in the country or abroad or if, on the date of the granting of the patent, serious and effective preparations to exploit the object to which the patent is directed have not been made by others in the country, provided that the patent application was filed with the National Directorate of Industrial Property on or after 1 January 1995.

Special transitional arrangements in developing countries

Inventions of pharmaceuticals and agricultural chemicals before November 1, 2001 shall not be patentable. Notwithstanding this, an invention patent may be requested for those products, in accordance with the provisions and requirements of this law, giving the date established in the foregoing paragraph as the deadline for the granting thereof. When patents for pharmaceuticals and agricultural chemicals claim the right of priority under Article 4 of the Paris Convention for the Protection of Industrial Property, in no case may the first deposit be prior to January 1, 1994.

Law on marks used in manufacturing, trade and agriculture

The Trademark Law55 established registration of licenses for brands, for manufactured goods brands, and for embargoes, as well as protection of advertising phrases, collective marks, and certification or guarantee marks. The following may be used as trademarks: names of objects or people’s names, in a particular form, emblems, monograms, prints, stamps, seals, stickers and reliefs, words or brand names, letters and numbers with drawings forming special combinations, wrappers and containers of objects, and other symbols with which it is desired to distinguish the artifacts of a business, the objects of a trade or agricultural, extractive, forestry and livestock products.

Protection of plant varieties

Production, certification, marketing, export and import

The conditions under which seeds are produced, commercialized or transported within the country are established and adjusted according to quality standards, in accordance with the rules set forth in the Seeds Law56, which creates the National Seeds Institute (INASE) [Instituto Nacional de Semillas] and National Registry of Cultivars [Registro Nacional de Cultivares], under its responsibility. Only those varieties which have been listed in this Registry shall be allowed to be certified and marketed in the country. Regulations may provide for exceptions regarding species required to be listed in this registry in order to be marketed.

Article 66 regulates property protection of new varieties. INASE maintains the National Cultivar Property Registry [Registro Nacional de la Propiedad de Cultivares], which aims to recognize and guarantee breeder’s rights for new plant varieties, by the issuance and registration of a property title, in accordance with the International Convention for the Protection of New Varieties of Plants57.

Requirements for protection

To be the object of protection, a plant variety must meet the following requirements:

Be new: This means that the variety must not have been offered for sale or marketed with the consent of the breeder within that country before the date of filing for protection, and beyond, for more than 6 years in the case of vines and trees, or more than 4 years in the case of other plants.

Be clearly different from any plant variety whose existence is common knowledge at the time of filing for protection in respect to at least one morphological, physiological, cytological, chemical or other important characteristic which is unchanging and which is likely to be described and recognized with precision.

Be sufficiently homogeneous in all of its traits, according to its system of reproduction or multiplication.

Remain stable in its essential traits, i.e., at the end of each cycle of multiplication performed in the manner prescribed by its breeder, the variety must retain the traits described by the breeder.

It shall not be considered prejudicial to the novelty of a plant variety for it to have been offered for sale or marketed in the country with the consent of the breeder, for a period of up to 4 years preceding the application for protection of the species to which the plant variety belongs, provided that such application is filed before the period of 4 months after the decision of INASE.

Scope of protection

The property title duly registered in the National Cultivar Property Registry shall enable its owner to conduct, in relation to their property rights, all legal transactions permissible by law, giving the owner the exclusive right as well as the right to consult and grant prior authorization for introduction in the country, production for commercial purposes, sale, marketing in the country and abroad or donation in accordance with this law and its regulations, the elements of sexual reproduction or vegetative propagation of the plant variety in question .

Exceptions to the rights protected

The plant variety covered by the property title may be used without this use granting rights to the title owner for any type of compensation, if: the product of its cultivation is used or sold as raw material or food; if seeds are planted and set aside for own use, but not for marketing; if other breeders use it for experimental purposes or as a source of genetic material for the creation of new plant varieties, where the plant variety is not used repeatedly and systematically to produce other crops commercially.

Restrictions on the exercise of protected rights

The Executive branch may declare a property title to be of “public use” for a period not exceeding two years, subject to prior and adequate compensation to the owner, when it is considered to be of general interest to have the product of its cultivation. The Executive branch may take emergency possession of the plant variety declared to be of “public use” as provided by Article 19 of Decree-Law No. 15,173/81.

Term of protection

The validity of the property title shall go into force from the moment of its provisional issuance, and may not be less than 15 years nor more than 20, in accordance with the species concerned and as established by regulation.

National treatment and right of priority

Breeders living abroad shall enjoy the same rights as breeders located in the country, provided that the laws of their country recognize and protect their rights as breeders. When a breeder who lives abroad wishes to register a plant variety, they must: (a) provide for such purposes a legal domicile in Uruguay, or appoint an authorized representative in the country; (b) include, in the relevant application, the duly authenticated official history of the country origin which they believe permits them to register the plant variety; (c) undertake to comply with all Uruguayan laws and regulations on plant variety property.

When a breeder who lives abroad, in a country that is part of a bilateral or multilateral agreement with Uruguay in the matter, has filed applications to register as a plant variety in one or more of those States, Uruguay shall enjoy a period of priority of 12 months, counted from the filing date of the first application. The application in Uruguay will be deemed to have been filed on the date of submission of the first application.

Revocation or termination of protected rights

A plant variety property title shall be revoked or expire, in accordance with each case, for the following reasons: (a) at the request of the owner, due to the completion of the legal period of property protection; (b) when it no longer meets the conditions of homogeneity and stability; (c) when the rights holder is not able to provide breeding material that allows producing the plant variety, as defined at the time of when the title was granted; (d) where it is demonstrated that the title was obtained by fraud on the part of third parties; e) when the National Seeds Institute legally proves that when property title was granted, the plant variety did not meet the requirements of the law.

Regulatory public bodies

National Directorate of Industrial Property

This refers to the Executive Unit of the Ministry of Industry, Energy and Minerals, responsible for managing and protecting intellectual property rights, which are taken to be the set of provisions that protect both the activity manifested by innovative new products, new procedures or new designs, as well as commercial activity, by identifying unique products and services offered in the market.

The Directorate is responsible for registering licenses for brands, for manufactured goods brands, and for embargoes, as well as for protecting advertising phrases, collective marks, and certification or guarantee marks. In 1999, the Directorate obtained the ISO 9002 quality certification in the field of marks, a circumstance that allowed the development of a Quality Management System geared towards customer satisfaction, promoting the concept of total quality. In the area of inventions, it is responsible for enforcing Law No. 17,164, dealing with the adequacy of national legislation for international obligations undertaken with approval of the TRIPS Agreement.

The Directorate has a strong policy of openness to all citizens, initiated by the Technical Committees, which include representatives from the state and private sectors. This area also includes issuing publications on the subject and organizing various events at the national and international level, in order to provide greater dissemination. The professionals and staff who provide services to the Directorate have outstanding technical training acquired in continuous specialization nationwide, as well as specialized courses abroad.

National Seeds Institute

This is a non-governmental body of public law whose main goals are: 1) promoting the production and use of better seeds with proven identity and superior quality, to stimulate the development of the national seed industry; 2) supporting the collection and use of new national plant genetic materials as well as those of external origin which are adapted to country conditions; 3) protecting plant genetic discoveries and creations, granting the corresponding titles; 4) promoting the export of seeds; 5) monitoring regulatory compliance in this area; and 6) proposing regulations on production, certification, marketing, export and import of seeds, and protection of plant genetic creations and discoveries.

Its main duties are: promoting the development of the activity with seeds, monitoring production and marketing and advising the Executive branch on matters of seed policy, issuing its findings in advance. Its responsibilities include organizing and operating the National Registry of Plant Varieties. To be registered in this institution, the plant varieties must be different from those already registered, they must be sufficiently homogeneous in their set of traits, in accordance with their system of reproduction or multiplication, and they must meet stability conditions allowing their identification. They are also received by the National Registry of Seed Breeders, Manufacturers and Traders. The National Seeds Institutes is also responsible for maintaining the National Cultivar Property Registry and granting the corresponding titles, in accordance with national regulations and international agreements.

The National Seeds Institute is also responsible for: (a) seed certification at the national and international levels, observing bilateral, multilateral and international agreements; (b) maintaining the official seed laboratory of the country, for performing analyses, and granting the appropriate certificates in observance of bilateral, multilateral and international agreements; (c) enabling and performing audits of private labs for analysis of seeds; (d) transacting and resolving issues of import and export of seeds.

Its main organs are the Board of Directors and the National Seeds Council [Consejo Nacional de Semillas], which are composed of one representative from each of the following institutions: the School of Agriculture, the National Institute of Agricultural Research (INIA) [Instituto Nacional de Investigación Agropecuaria], the Agricultural Engineers Association [Asociación de Ingenieros Agrónomos], the National Farm Board [Junta Nacional de la Granja], the National Agricultural Planning Institute [Instituto Plan Agropecuario], the Honorary National Citrus Planning Commission [Comisión Honoraria Nacional del Plan Citrícola], and the National Viticulture Institute [Instituto Nacional de Vinicultura], acting in the Plenary with members of the Board of Directors and the Executive Director. It also has a User Committee, composed of representative from the following institutions: the Rural Federation [Federación Rural], the Federated Agricultural Cooperatives [Cooperativas Agrarias Federadas], the National Rural Development Commission [Comisión Nacional de Fomento Rural], the Rural Association of Uruguay [Asociación Rural del Uruguay], the Rice Growers Association [Asociación Cultivadores de Arroz], the National Milk Producers Association [Asociación Nacional de Productores de Leche], the Farmer’s Confederation of Uruguay [Confederación Granjera del Uruguay], the Uruguayan Federation of CREA Groups [Federación Uruguaya de los Grupos CREA] [Consorcios Regionales de Experimentación Agrícola] and the Canelones Association of Agricultural Producers [Asociación de Productores Agrícolas de Canelones]. The Plenary meets quarterly.

Part 4
Biosafety regulations in the Mercosur countries

Chapter 1
Biosafety regulations in Argentina

Regulation of production areas related to biotechnology

In the agricultural sector, overall responsibility for the regulatory framework lies with the Secretariat of Agriculture, Livestock, Fisheries and Food (SAGPyA) [Secretaría de Agricultura, Ganadería, Pesca y Alimentos], which develops this activity through the National Seeds Institute (INASE) [Instituto Nacional de Semillas] and the National Service for Agrifood Health and Quality (SENASA) [Servicio Nacional de Sanidad y Calidad Agroalimentaria].

The National Seeds Institute is responsible for ensuring the availability, identity and quality of seeds which farmers acquire, and ensuring agricultural and market transparency, for seeds from both national and imported sources, combating unfair competition. It is intended to encourage the development of plant breeding activity, to defend the rights granted to breeders of new varieties and to promote efficient production and marketing, while stimulating exports.

SENASA is a decentralized agency, with the mandate to protect public health, monitoring and overseeing the procedures applied in the chain of animal and vegetable agrifood products. The agency enforces Law No. 18,284, the Argentine Food Codex, Decree No. 12,585/96 on the Establishment and Jurisdiction of SENASA, Decree No. 4,238 on the Inspection of Meat, and Decree 811/99 on Control of Food Systems. The agency has the authority to propose regulations and to organize its own regulatory system. SENASA can also formulate regulations applicable to other entities.

SENASA ensures that certification systems and sanitary inspection are directly proportional to risk assessment of disease transmission. It is responsible for developing and organizing a registry of certification bodies for entities involved in production and preparation of organically or ecologically obtained food of animal origin. It also is responsible for certifying grants to export agricultural animal and plant food products by assessing sanitary and/or quality actions required by international markets.

Regulations in the field of human health are the responsibility of the National Administration of Drugs, Foods and Medical Devices (ANMAT) [Administración Nacional de Medicamentos, Alimentos y Tecnología Médica], a decentralized agency which reports to the Department of Sanitary Policy and Inspection (SPyRS) [Secretaría de Política y Regulación Sanitaria] of the Ministry of Health (MS) [Ministerio de Salud]. ANMAT operates through two main arms: the National Institute of Medicine (INAME) [Instituto Nacional de Medicamentos] and the National Food Institute (INAL) [Instituto Nacional de Alimentos].

INAME has the authority to control and monitor the health and quality of products that can affect human health. These products include: drugs, chemicals, reagents, pharmaceutical forms, medicines, diagnostic elements, and packaged foods, including specific inputs, additives, dyes, sweeteners, colorings and ingredients used in food. The agency addresses the problem of control from three angles: computerized records based on data from companies and products; inspections to ensure good manufacturing practices; and monitoring of approved products to control their quality.

To meet its responsibility for food control, INAL has its own laboratories, recently recycled and ready to be refitted. It maintains communication with a network of subsidiaries within the country and with state and local agencies responsible for food control. It promotes, supervises and evaluates the development of the National Food Control Program, in its different stages, in coordination with state and municipal agencies. The regulations on foods include state and local provisions.

In the environmental area, regulations are the responsibility of the Department of Environment, at Argentina’s Ministry of Social Development and Environment (MDSyMA) [Ministerio de Desarrollo Social y Medio Ambiente]. There is a growing tendency in this area to establish standards of environmental preservation in provincial and municipal jurisdictions, including for example pioneering initiatives taken by the Province of Buenos Aires.

Companies interested in certifying ISO 9000 compliance must comply with the National Standards, Quality and Certification System, established in 1994. The System “offers reliable instruments at the local and international levels, for companies that wish to voluntarily certify their quality systems, products, services and processes through a mechanism that relies on standardization and certification bodies, in accordance with integrated current international standards.” In the environmental field, the ISO 14000 series of standards has started being applied in the country, also voluntary and still under development. The adoption of total quality standards and environmental quality does not exempt companies from the obligation to comply with technical and marketing regulations, which are binding throughout the territory.

Regulating the introduction of genetically modified organisms (GMOs) in the agricultural sector is integrated into the overall regulatory system for the agricultural sector, composed of Decree-Law No. 6,704/66 for the Sanitary Protection of Agricultural Production, and its modifying laws; Law No. 20,247/73 for Seeds and Plant Genetic Creations and its regulatory decree; and Law No. 13,636/49 for Veterinary Products, Supervision of their Preparation and Marketing.

Regulation of activities in the biotechnology field

The increasing application of biotechnology to areas of great economic and social value, such as human and animal health, animal and plant production, mining, oil or sewage treatment, has prompted concern from various public and private organizations in Argentina, which are interested in making sure that research, production and release of GMOs be performed in conditions ensuring the preservation of safety for people and the environment.

The Argentine regulatory framework applicable to GMOs has three components: assessment of environmental risk, handled by the National Advisory Commission on Agricultural Biotechnology (CONABIA) [Comisión Nacional Asesora de Biotecnología Agropecuaria], assessment of food safety, which is under the jurisdiction of SENASA, and assessment of the impact of trade liberalization of GMOs on the international markets of the country, which is the responsibility of the National Directorate of Agrifood Markets (DNMA) [Dirección Nacional de Mercados Agroalimentarios].

The first assessment of a GMO focuses on its impact on the environment, and takes place from the beginning of its development, i.e., from small-scale trials in greenhouses or in the field. The regulatory framework examines each case, following the development of the GMO and may stop it and prevent its release if there are doubts about its risks to the environment and/or about its use as a raw material for food. If the risks are not acceptable, the development of the GMO will be stopped during confined trials. This ensures that no product reaches the market without having satisfactorily complied with safety requirements.

The Argentine regulatory system reviews each case and is based on the characteristics and risks identified for the biotechnology product, not the process by which the product originated. It is applied to transgenic products based on their proposed use, considering only those aspects of the procedures used to obtain it which may imply risk to the environment, to agricultural production and to public health.

Responsibility for the various activities related to environmental release of GMOs lies with SAGPyA. In the case of plant varieties, evaluation is the responsibility of CONABIA, and monitoring is the responsibility of INASE and SENASA. In matters involving experimentation, production and release of products involving animal, plant or agrifood health, the assessment is the responsibility of SENASA, which has organized a Technical Advisory Committee on the Use of GMOs [Comité Técnico Asesor para el Uso de OGM] (CTAUOGM) for this purpose. In the case of genetically modified animals, the responsibility lies with CONABIA. The area of human health and processed foods is the responsibility of ANMAT, through the National Commission on Biotechnology and Health (CONBYSA) [Comisión Nacional de Biotecnología y Salud].

The biosafety of food derived from GMOs is regulated by two resolutions from SAGPyA: Resolution No. 289/97, which establishes the jurisdiction of SENASA in the surveillance of foods derived from GMOs, and Resolution No. 511/98 and attachments (SAGPYA, 1998), which establish the criteria to apply in food safety matters. Resolution No. 511/98 is based on the FAO and the relevant regulations of Australia, Canada, EU, Japan and the United States, regarding the requirements and criteria for the biosafety and characterization of foods derived from GMOs, in relation to their capacity for human and animal consumption. The criterion of substantial equivalence is applied.

“Equivalence” consists of characteristics of composition, nutritional value and uses. The term “substantial equivalence,” in turn, implies risk assessment and compositional analysis, which in the Argentine system is handled by SENASA, regarding all aspects by which the new food can be differentiated from the traditional. These include, for example, changes in the content of toxins and allergens (from the traditional), toxicity and allergenicity (of the new protein structure), macromolecular components (compared with the traditional), digestion and metabolism (of the new, but not only), bioavailability of nutrients and micronutrients, acute toxicity (of the food or new proteins), chronic toxicity (when necessary), formulation and testing of animal feed (subproducts), need for consumer information, changes in functional groups, and others.

The involvement of DNMA was established by Resolution No. 289/97, from SAGPyA, and it undertook the task of evaluating the impact on Argentina’s international trade of possible marketing of GMOs under consideration. DNMA prepares a technical report which establishes which GMO seed varieties may be sold by companies to Argentine farmers. CONABIA, SENASA and DNMA develop the basis of a “draft resolution,” prepared by CONABIA. This resolution, signed by SAGPyA, grants authorization for commercial use of GMOs. Before being able enter the market with the product, the interested party must apply for registration of the new variety with INASE, as a condition of controlling ownership and business practices in the seed industry. When the GMO has insecticidal properties, such as plants which express Bt or which have been modified to be herbicide tolerant, marketing requires specific prior authorization from SENASA.

In terms of genetically modified animals, a draft of guidelines for their management and control is being prepared. According to this initial draft, the import of genetically modified animals, gametes or embryos requires authorization granted on the basis of conditions controlled by SENASA, which shall serve as a receiving office for processing of applications for animals, similar to what INASE does for applications for plants. SENASA shall hand off the processing to CONABIA, whose approval is prior to SAGPyA’s decision to approve or deny. The Committee will examine food safety data submitted by applicants, which are in many cases contained in envelopes prepared for approval in the United States and the European Union. The Committee may request additional data if it deems necessary.

National Advisory Commission on Agricultural Biotechnology (CONABIA)

CONABIA was created by Resolution No. 124/91 dated October 24, 1991, by the Secretariat of Agriculture, Livestock and Fisheries (SAGyP) [Secretaría de Agricultura, Ganadería y Pesca]. That resolution considers that the development of agricultural biotechnology produces a considerable impact on the activity of the sector and the environment, due to the incorporation of new genetic material that helps to improve quality and increase the amount of food available. For this process to be developed within the framework of a biosafety system that guarantees agro-ecological balance, it is essential to have a proper integration between scientific knowledge, the productive apparatus and the current regulatory framework, linking the state’s efforts to the private sector.

The functions of CONABIA are to advise the Secretariat beforehand regarding the technical and biosafety requirements which should be satisfied by genetic material obtained through biotechnological procedures, so that they can be incorporated into the biosystem by any procedure or method and in any capacity (testing, dissemination, etc.), by proposing standards and issuing findings on matters within its field of competence.

In Resolution No. 669/93 dated August 23, 1993, SAGyP established that CONABIA shall consist of representatives from institutions involved in agricultural biotechnology in the public and private sectors. Currently, within the public sector, the following are represented: the National Service for Agrifood Health and Quality (SENASA), the National Seeds Institute (INASE), the National Institute of Agricultural Technology (INTA), the National Council for Scientific and Technical Research (CONICET) [Consejo Nacional de Investigaciones Científicas y Técnicas], the University of Buenos Aires (UBA), and the Department of Sustainable Development and Environmental Policy (SEDSyPA) [Secretaria de Desarrollo Sustentable y Política Ambiental]. The private sector participates through the Biotechnology Committee of the Argentine Seed Growers Association (ASA), the Argentine Forum on Biotechnology (FAB), Argentina’s Chamber of Agricultural Health and Fertilizers (CASAFE) [Cámara de Sanidad Agropecuaria y Fertilizantes], the Argentine Chamber of the Veterinary Products Industry (CAPROVE) [Cámara Argentina de la Industria de Productos Veterinarios] and the Argentine Ecological Society (AsAE) [Asociación Argentina de Ecología].

Based on the experience of countries with the a longer tradition in this area, the Commission has developed specific regulations concerning the technical and biosafety requirements to be met in experimentation and/or environmental release of genetically modified plant organisms and genetically modified microorganisms and/or their products for applications on animals. These standards have been adopted by SAGyP, in Resolution No. 656/92 dated 30 July 1992.

The decisions of CONABIA are based on scientific criteria, together with specific regulations (SAGYP, 1992), which have been prepared by the Commission on the basis of the directives of the ministerial authority’s policies and existing laws. These regulations have been based on those used by the United States Department of Agriculture and Animal Plant Health Inspection Service (USDA-APHIS). The Commission studies requests and recommends whether or not they should be authorized. Once the technical findings have been issued, the administrative decisions fall within the scope of ministerial authority.

The principle which guides the implementation of standards for particular cases is that the measures taken to reduce the risk should be related to the level of potential risk. For this purpose, the three factors that determine the safety of an environmental release are:

Traits of the organism (possibilities of cross-breeding between species, propagating mechanisms, the ability to become invasive plants) including the donor/recipient/vector system (identification of the donor species for the gene, the vectors and the genetic product and metabolic pathway affected, the effect of the genetic product on plant material and on the production of metabolites, in order to assess the compounds that could enter the food chain and include background information on gene transfer within the same species or to other ones).

Features of the site and the surrounding environment (site description and precise location, details and plot size, and quantity of seed to be planted).

Use of appropriate experimental conditions (purpose of the release, reproductive isolation measures proposed for control varieties and planned isolation distances, methods of control of potential vectors of different types, ranging from insects to cultural approaches; techniques to detect the transfer of genes from GMOs to the environment; description of the final disposal of the material and the proposed destination (land treatment, post-harvest monitoring, future use of the land, subsequent control, duration of control, and destination of the harvest).

By Resolution No. 289/97, the Secretary of Agriculture, Livestock, Fisheries and Food is the competent authority to authorize trials and/or environmental release of genetically modified plant organisms, requiring prior finding by CONABIA. Authorizations will be granted in the following cases:

Conducting a greeenhouse-laboratory trial.

Conducting a field trial.

Pre-commercial multiplication of material.

Once the application has been evaluated, CONABIA will pronounce its findings in relation to the desirability or not of releasing GMOs and will submit it to receive authorization from the Secretary of Agriculture, Livestock, Fisheries and Food. Upon expiry of the authorized period, the applicant must submit a final report to CONABIA. The experiment will be completed when the following conditions have been met:

Appropriate risk management by the applicant.

No differences between allowed conditions and those observed at the experimentation and/or release site by inspectors authorized by the competent authority.

Presentation of final report.

By monitoring the trials, it is intended to evaluate, on-site, actual compliance with what was presented in the applications, and prepare to implement measures to prevent adverse effects on the environment outside the trial (such as the spread of invasive plants). Control of lots will also be done, after the time of harvest, to limit the possible transfer of the genetic information contained in the GMO to other organisms.

Applicants that have obtained authorizations for trial and/or environmental release of the GMO may request relaxation of conditions on authorizations from CONABIA. Once authorization is granted by the resolution from SAGPyA, in future environmental releases, information should be presented regarding: area planted, planting date, release location and date of harvest. CONABIA will only recommend conducting inspections of harvest and disposal of material. Relaxation of conditions does not imply authorization for commercial sale of seed.

If it is desired to sell the seed, the following requirements must be met:

Must have received permission to relax the conditions for granting authorizations for environmental release of the transgenic material.

Must comply with the requirements established by INASE for inclusion of the material in the National Registry of Plant varieties and in the Audit Scheme [Régimen de Fiscalización].

Must comply, where appropriate, with the requirements established by the National Service for Agrifood Health and Quality (SENASA) regarding authorizations for the commercial sale of agrochemicals.

The application must be filed with the Technical Coordination of CONABIA by initiating, with SENASA, the procedures necessary to comply with the requirements that fall within its jurisdiction in relation to human, animal and food uses of the transgenic material and its derived products. SENASA will request the information needed from the applicant in order to supplement its various assessments.

CONABIA establishes, for each proposed release (event), the safety conditions to ensure minimal potential risks. Each case is handled by the Commission as a whole, and all decisions are taken unanimously. The procedure includes inspections during cultivation, harvest and post-harvest monitoring. Confidentiality of commercial data is ensured through a centralized procedure at INASE or SENASA.

Up to the time of this writing, the activities of CONABIA have been concentrated in evaluating applications for authorization of field trials of transgenic plants, including a proof of storage and shelf life of transgenic tomatoes. Since its inception, CONABIA has evaluated and authorized 433 events, of which six have received marketing authorization, and five coincide with similar decisions of the European Union. During 2000, the dynamics for authorizing events underwent a consolidation.

Corn, sunflower, soybean and cotton are the crops that had the greatest number of trials authorized, followed by wheat, potato, rapeseed (canola), sugar beet and others. The main traits introduced were herbicide tolerance and insect resistance.

The Commission recommended approval of relaxation of conditions of experimentation and/or environmental release of genetically modified plant materials, finding no anticipated biosafety problems for the agroecosystem due to large-scale cultivation of GMOs: A2704-12 and A5547-127 soybean tolerant to the herbicide ammonium glyphosate from the company AgrEvo S.A. Requests for relaxation of the trial conditions of the following transformation events are under evaluation by CONABIA: CBH 351 corn resistant to insects and tolerant to the herbicide glyphosate ammonium (applicant: AgrEvo S.A.) and cotton tolerant to the herbicide bromoxynil (applicant: Aventis CropScience Argentina S.A.).

During 2000, the Commission granted approval for 65 trials (field and greenhouse) with genetically modified plants and one trial with genetically modified material for veterinary use, and denied approval for four trials (field and greenhouse) with genetically modified plants. More recently, the new authorities of SAGPyA approved the release of a variety of herbicide-tolerant cotton.

Most applications come from transnational corporations, which have taken advantage of having off-season field trials to accelerate the development of transgenic plants performed in their central laboratories. Most applications analyzed have prior approval from USDA-APHIS, or similar approval from European countries. These prior approvals are carefully analyzed, regarding risks specific to local ecosystems. When necessary, additional information is requested from applicants, or limitations or precautions are recommended specifically for performing trials in the country

Applications for events by multinational companies have been mainly for corn, soybeans and cotton. Applications for events by Argentine seed companies focus on potatoes, wheat, corn and cotton, with the participation of research institutions in the public sector, such as INTA, CONICET and national universities. It should be noted that within these institutions there are several research projects related to cereal seeds, oilseeds, vegetables and industrial crops.

SENASA’s Technical Advisory Committee on the Use of GMOs (CTAUOGM)

SENASA created, via Resolution No. 1,265/99, a Technical Advisory Committee on the Use of GMOs [Comité Técnico Asesor para el Uso de OGM] (CTAUOGM), comprising representatives from the following institutions: CONABIA, the Agronomy, Veterinary, Pharmacy and Biochemistry Schools of the University of Buenos Aires, the National Food Institute (INAL), the National Council for Scientific and Technical Research (CONICET), the National Institute of Medicine (INAME), the Argentine Seed Growers Association (ASA), the Argentine Agrarian Federation (FAA) [Federación Agraria Argentina], the Coordinator for Food and Beverage Industries (COPAL) [Coordinadora de las Industrias de Productos Alimenticios], the Argentine Rural Confederation (CRA) [Confederaciones Rurales Argentinas], the Agricultural Intercooperative Confederation or CONINAGRO [Confederación Intercooperativa Agropecuaria], the Argentine Rural Society [Sociedad Rural Argentina], the Argentine League of Consumers [Liga Argentina de Consumidores] and organizations of industrial producers engaged in this area.

The main purpose of the Committee is to provide an external and multidisciplinary advisory body to SENASA, offering a broader base for regulatory decisions. The Committee’s activities began with a thorough review of Resolution No. 511/98 to improve the evaluation of food safety. The main topics under review include a narrower and more complete definition of conditions and a review of the concept of substantial equivalence, an issue currently under discussion in many forums. It is being considered whether to incorporate the International Standards currently being studied by the Committee on Biosafety of the Codex Alimentarius.

SENASA also manages regulatory processes and quarantine of plants and animals and compliance with phytosanitary requirements. In recently adopted procedures for the import of plants, plant parts and animals, a form was incorporated where the importer must state whether it is introducing genetically modified material into the country. If the answer is affirmative, the import will be sent to CONABIA and the applicant must submit to the Commission a detailed description of the GMO, the nature of work and the resources available to perform the research. The technical staff of CONABIA evaluates safety conditions and formalizes its approval as a prerequisite for authorizing importation. Until authorization is granted, SENASA temporarily stores the GMOs in a safe location.

National Seeds Institute (INASE)

INASE is the agency of SAGPyA in charge of registering and controlling seeds that will be commercialized in the country. Depending on the species, the registration of a new variety requires 2 or 3 years of comparative field trials, to be held in different situations. Transgenic crops are treated similarly to new hybrids, in comparing for essentially derived varieties.

The registration of the variety may be done immediately after marketing authorization has been obtained. Field trials of GMOs, conducted under conditions recommended by CONABIA, can be used as valid trials for registration purposes. An Advisory Committee of the National Seeds Commission (CONASE) [Comisión Nacional de Semillas] confirms the results and decides whether the material qualifies as a new variety.

At the end of 2000, changes were introduced in the structure of INASE, taking away its status of “National Institute,” although it retained its mandate and functions, and the same staff.

National Directorate of Agrifood Markets (DNMA)

The Argentine regulatory framework applicable to GMOs has three components: risk assessment for the environment, which is the responsibility of the National Advisory Commission on Agricultural Biotechnology (CONABIA), assessment of food safety, which is under SENASA, and assessment of the impact of the commercial release of GMOs on international markets in the country, which is under the jurisdiction of the National Directorate of Agrifood Markets (DNMA) [Dirección Nacional de Mercados Agroalimentarios]. The intervention of DNMA was established by Resolution No. 289/97, from SAGPyA.

National Commission on Biotechnology and Health (CONBYSA)

Within the institutional scope of the National Administration of Drugs, Foods and Medical Devices (ANMAT), which is the national regulator in these areas, the National Commission on Biotechnology and Health (CONBYSA) [Comisión Nacional de Biotecnología y Salud] was created, with the mission to “assist in the development and application of biotechnology in the field of human health.” CONBYSA was created by Resolution No. 413/93 from ANMAT, in December 1993, at the initiative of the Commission and the Argentine Forum on Biotechnology (FAB).

CONBYSA is composed of three representatives from ANMAT and three from the Argentine Forum on Biotechnology (FAB), and is coordinated by the Director of ANMAT. It is involved in controlling biological products obtained by biotechnology techniques, i.e., rDNA or monoclonal antibodies. For the implementation of its work, advisory subcommittees were created, made up of professionals from the public and private sectors from industry associations, universities and scientific and technical institutions.

The purpose of the Commission is to analyze and study existing regulatory standards governing the development, preparation and approval of biotechnology products for use in healthcare and human consumption.

The Commission has established four working subcommittees, which include participation of various industry associations, universities and institutions. The subcommittees are: 1) In vitro Diagnostic Reagents, 2) In vivo Biopharmaceuticals and Diagnostic Products, 3) Industrial Plants, 4) Food.

The subjects of study are the following:

Biosafety: biotechnology research and development laboratories.

Installation of facilities prepared in accordance with ongoing processes, ensuring safety of the operators, the bioproducts and the environment.

In vitro diagnostic reagents: adequacy of existing recordkeeping standards for reagents of biotechnological origin and quality control of raw materials and products, both domestic and imported.

In vivo Diagnostic reagents: adequacy of current recordkeeping standards for the characteristics of products obtained by biotechnological techniques in order to ensure their effectiveness and safety, quality control of raw materials and finished products, both domestic and imported.

Pharmaceuticals: development of guidelines for presenting preparation processes (production, purification, formulation), in accordance with the procurement of the biopharmaceutical indicated for its therapeutic use in conformance with each biopharmaceutical’s unique characteristics; development of standards to monitor the quality of the preparation process, raw materials and finished product, and registration and control of imported drugs.

Food: adequacy of current guidelines for biotechnology products, raw materials, additives, preservatives, etc., quality control, working with CONABIA if the plant raw material is of biotechnological origin.

Internal quality control laboratories (within the establishment) and/or external.

National and international reference and control laboratories: the appointment of external consultants who are experts in each subject.

Reference standards and national standards.

Cartagena Protocol on Biosafety at the Convention on Biological Diversity (CARULLO, 2002)

The Convention on Biological Diversity is the national law in Argentina, but has not been regulated to date. For this reason, there are no current regulations regarding access. Research institutes are governed by international agreements such as the Code of Conduct for Plant Germplasm Collecting and Transfer of the United Nations Food and Agriculture Organization (FAO).

Argentina has acceded to the Cartagena Protocol on Biosafety, which regulates the exchange of genetically modified organisms. The agreement imposes responsibilities on countries in order to ensure that the movement of GMOs between the borders of each country is adjusted so as to control risks and avoid negative impacts on biodiversity or human health. The application of procedures based on the “precautionary principle” provides that a country can refuse to import a particular GMO, in the absence of scientific evidence about its potentially harmful action. Considering its status as a leading exporter of articles derived from GMOs, Argentina is likely to face a significant challenge to balance the adoption of GMO varieties in the face of a growing demand for non-GMOs.

Argentina is preparing to develop regulatory frameworks and capacity to provide risk evaluations for these countries. Argentina has not publicly taken an official position on its interest in modifying its existing regulatory system to incorporate the problems generated by the adoption of the precautionary principle. As background, it should be noted that the Second National Report of the Parties58, prepared in May 2001 by the Department of Sustainable Development and Environmental Policy (SEDSyPA) of the then Ministry of Social Development and Environment (MDSyMA), refers to the advances that have been produced in Argentina in relation to Articles 19 and 20 of the Convention, concerning the management of biotechnology and distribution of its benefits and, in particular, Decision IV/3: Issues Related to Biotechnology Safety, and Decision V/1: Work Plan of the Intergovernmental Committee for the Cartagena Protocol on Biosafety.

The Argentine government has declared that it is granting a medium priority to the enforcement of Article 19 and its decisions, noting it has are limited resources to make the needed investments. With regard to Decision IV/3, the report notes that the country has signed the Protocol and its ratification is in process. Regarding the question of whether the country had assessed the need at the national level to implement effective regulation of genetic use restriction technology (GURT) in order to ensure safety of human health and the environment, food safety and conservation and sustainable use of agricultural biological diversity, the answer was that such legislation was unnecessary, because it is included in current legislation.

As part of its strategy to adapt to the Protocol, Argentina’s government is proposing that institutional areas linked to the regulation of biotechnology be made hierarchical, with the backing of a law from the National Congress. The intent of the draft Biosafety Law on the Application of Biotechnology in Agriculture 59 was to give legal character to the current regulatory framework for approval of GMOs, regarding their biosafety, and their safety as agrifoods and for the healthy functioning of markets. The discussion on the impact of transgenic food biotechnology should be imposed on all the legislative bodies of the country at the regional level, taking the discussion to the Mercosur Parliament, to build regional biotechnology regulations.

Draft Law on Biosafety in Agricultural Biotechnology

Special Commission of Biotechnology of the Chamber of Deputies

Considering the strategic importance that the development of biotechnology has for Argentina, the country’s Chamber of Deputies created, in May 2001, the Special Committee on Biotechnology. Its purpose was to pass the appropriate legislation needed to facilitate biotechnology development and to address issues related to biosafety. Its main objectives were to: review and issue findings on the regulations necessary to organize and promote the development of biotechnology, coordinating national legislation with international commitments of the country; make an evaluation of international, national, state and municipal regulations on the matter; and hold a convocation of stakeholders from all levels to develop a proposal for legislation on the matter.

As the initial result of its activity, the Commission has prepared a Draft Law on Biosafety in the Application of Agricultural Biotechnology, which is in an advanced stage of parliamentary proceedings and which is, simultaneously, under discussion by organizations in society involved in biotechnology.

Draft Law on Biosafety in Agricultural Biotechnology60

The Draft Law aims to: establish the regulatory framework to update and provide hierarchy and legally binding nature to the process of incorporation of GMOs into agricultural and agribusiness production systems, ensuring biosafety conditions and promoting the development of modern biotechnology in agricultural production, considering it as a key strategic factor to increase agricultural productivity and competitiveness, as well as raising levels of quality, differentiation and value added for food and other products.

The process of incorporation of GMOs into the market will be performed via the fulfillment of the three stages of preliminary assessment:

Risk assessment and the environmental benefits of their production.

Assessment of the biosafety of food and other products.

Assessing the impact of trade liberalization in international markets.

The draft law expressly prohibits, and considers as a crime, the introduction, experimentation, production, use, release, marketing and any other possible use of GMOs without authorization granted by the enforcement authority. The Executive branch shall establish responsibilities and procedures, and regulate the scope of the instances of the evaluations provided, satisfying strictly scientifically based principles regarding the nature of the products.

All information linked to the regulatory process and the commercial approval of a transformation event is public and the enforcement authority shall ensure that it is available to all interested parties, on an ongoing and continuous basis, except aspects which are subject to confidentiality.

The enforcement authority provided by law is the Secretary of Agriculture, Livestock, Fisheries and Food of the Nation (SAGPyA), with the power to: (a) grant or deny authorizations to experiment, environmentally release and market GMOs, with prior technical findings from the advisory bodies created and validated by the law; (b) establish the biosafety conditions required to regulate the incorporation of GMOs into agricultural and agribusiness production systems and; (c) exercise the corresponding enforcement powers.

The project validates the creation of the National Advisory Commission on Agricultural Biotechnology (CONABIA), pursuant to SAGyP Resolution No. 124/91, which shall be interdisciplinary and interinstitutional, and whose members shall serve on an honorary basis. It shall consist of members from organizations operating in this area, on the initiative of the SAGPyA, which shall designate their authorities. Members shall also include the Secretariat of Technology, Science and Productive Innovation (SeTCIP) [Secretaría de Tecnología, Ciencia, e Innovación Productiva] and representatives from organizations designated by the Department of Sustainable Development and Environmental Policy (SEDSyPA). CONABIA has the following functions: (a) advising the enforcement authority on the present law regarding the technical requirements of biosafety that GMOs must meet, prior to being incorporated into any procedure or method and in any capacity – trials, distribution, etc. – into agriculture and agribusiness production systems; (b) proposing regulations and issuing findings on matters within its jurisdiction; (c) enabling and coordinating subcommittees for the treatment of specific topics, and; (c) formulating their rules.

The law creates a Technical Advisory Committee on the Use of GMOs61 (CTAUOGM) which shall be interdisciplinary and interinstitutional. It shall consist of representatives from the organizations operating in the area, as well as a president and a coordinator who shall hold office on an honorary basis. The functions of the Technical Advisory Committee include: (a) proposing requirements and evaluating their compliance for authorization, by the enforcement authority, of the use of GMOs; (b) proposing standards and issuing findings on the safety aspects of GMOs; (c) collaborating upon request with official bodies within the framework of existing legal regulations; and (d) enabling and coordinating subcommittees for the treatment of specific topics, which may be permanent, and which will be staffed in accordance with internal regulations.

The law creates, within the enforcement authority, the Technical Advisory Committee for Agrifood Markets [Comité Técnico Asesor de Mercados Agroalimentarios de Organismos Genéticamente Modificados], which shall examine the impact on the conditions of access to international markets. It shall be interdisciplinary and interinstitutional. It shall consist of representatives of public and private organizations operating in this area. The overall coordination is the responsibility of the National Directorate of Agrifood Markets (DNMA) [Dirección Nacional de Mercados Agroalimentarios]. The members of the Technical Advisory Committee shall hold office on an honorary basis. Its functions shall be: (a) analyzing trade policies developed by the major GMO producing, consuming and exporting countries; (b) assessing the impact of commercial authorization of a transformation event on accessing foreign markets; and (c) formulating its internal rules.

Finally, the law creates an Agricultural Biosafety Fund [Fondo de Bioseguridad Agropecuaria], which shall be funded with taxes collected by customs, and whose resources shall be used exclusively to cover the costs resulting from compliance with the objectives of the law. Tariffs shall be established by SAGPyA. The project includes a glossary of technical terms used in the document on Conclusions and Recommendations of the Joint FAO/WHO Expert Consultation on Biotechnology and Food Safety (Rome, September 30 - October 4, 1996).

Chapter 2
Biosafety regulations in Brazil

Genetically modified organisms (GMOs)

As of this writing, Brazil has approximately 130 accredited institutions for research on GMOs. The majority (80%) are public institutions that develop projects aimed at obtaining drugs and vaccines in plants. However, these studies will only available in the market over the long term.

In 2004, the total area planted with transgenic crops continued to grow for the ninth consecutive year, at a double-digit rate (20%), compared with 15% in 2003 (Fig. 1). In 2004, the estimated global area of approved biotech crops was 81.0 million hectares, (200 million acres), up from 67.7 million hectares (167 million acres) in 2003. Biotech crops were grown by approximately 8.25 million farmers in 17 countries, up from 7 million farmers in 18 countries in 2003 (JAMES, 2004).

Figure 1. Global area of transgenic crops.

Source: James, C. Preview: global status of commercialized biotech/genetically modified crops. Ithaca, NY: ISAAA, 2004. 12p. (ISAAA briefs, 32).

GMOs are living organisms capable of biological reproduction, dispersal and evolution in the environment, creating safety issues different from those generated by products arising from chemical and physical technologies.

The possibility of gene flow from the GMO (the same way as occurs with varieties grown on a large scale) to sexually compatible species is a key issue in environmental risk assessment, particularly near the centers of origin and diversity of cultivated species, to avoid so-called “genetic contamination” (MENDONÇA-HAGLER, 2001). It should be taken into account that gene flow also occurs with plants from conventional breeding and will therefore represent a factor for the environment only if it adds traits that alter the natural survival of the recipient plant in its environment; however, gene flow should not be considered as an environmental impact factor.

The probability of gene flow depends on many factors, including: the plant’s reproduction processes, the mechanisms of pollen and seed dispersal and the environment where it is released.

The recommended procedures for risk management in order to minimize gene flow relate to spatial or temporal isolation in relation to sexually compatible species, removal of flowering plants, use of male sterile plants, use of bordering plants incompatible with the transgenic plant, appropriate procedures for disposal of transgenic material, and post-harvest monitoring.

Horizontal transfer of genes in the environment may occur in prokaryotic organisms, through processes of conjugation, transduction and transformation. The frequency of recombination is higher when the genes are found in plasmids. Therefore, in constructing genetically modified organisms, the new genes should be inserted into the chromosome, in order to hinder gene transfer to the environment (ARAÚJO et al., 1993).

The management challenge is to identify changes in the genotype which confer competitive traits under natural conditions, which can be experimentally tested by observing the survival of the GMO, or hybrids thereof, outside the conditions of cultivation, compared to the isogenic parental organism.

Increasing the area planted with tolerant plants favors the appearance of weeds having tolerance to broad spectrum herbicide resulting from gene transfer events and selective pressure, which give these plants a competitive advantage in agroecosystems when subjected to that herbicide. This risk can be reduced by modifying the construction of the GMO to hinder the introgression of genes in sexually compatible species (GRESSEL, 2000).

Biosafety of GMOs

Biosafety procedures are intended to prevent or minimize adverse effects of GMOs and their derived products on humans and the environment.

Possible deleterious effects resulting from the release of GMOs during experimentation or commercialization are evaluated at the same time that monitoring measures are established to detect adverse conditions as well as to mitigate undesirable impacts.

There are several steps to be accomplished before the product can be legally commercialized. The first requires that the institution or company have a Biosafety Quality Certificate (CQB) [Certificado de Qualidade em Biossegurança], which attests to its competence, responsibility and fitness. Later, the National Technical Commission on Biosafety (CTNBio) [Comissão Técnica Nacional de Biossegurança] must review and approve research projects in confinement planned environmental releases in Brazil, in a controlled manner, to measure possible risks.

Information on each trait specific to the GMO – such as the inserted gene, the reproductive traits of the species, the soil and climatic conditions where the GMO will be released, the possibility of gene transfer, and the stability of the construct, among others – is required from the interested party, so that CTNBio can deliver a conclusive finding on the safety of the GMO.

Biosafety is the state, quality or condition of biological safety of life and health of humans, animals and plants, as well as the environment, without ranking the protection from risks associated with genetically modified organisms.

The balance between occupational, educational, social, informational, regulatory, organizational and technological components generates the “biosafety status,” which is simply the harmony between man, work processes, the institution and society (COSTA, 1998).

Technological developments, scientific progress and legal rigor have been contributing to the reduction of systematic laboratory accidents. Thus, it is responsibility of CTNBio “to issue, at the request of the applicant, the Biosafety Quality Certificate (CQB) related to facilities used for any activity or project involving GMOs or their derived products” (COSTA, 1998).

The Biosafety Act and Regulatory Ruling (IN) [Instrução Normativa] No. 8 expressly forbid, in activities involving humans, genetic manipulation of germ cells or totipotent cells, as well as radical cloning experiments. Only proposals involving somatic cells without germinative power will be considered for intervention or genetic manipulation in humans (VARGAS, 1997).

Meanwhile, according to the law, food products whose ingredients are derived from GMOs are the responsibility of the Ministry of Health, because they involve issues of human health and food safety.

Brazilian legislation on GMOs: Law No. 11,105

In March 2005 the President of the Republic signed Law No. 11,105 establishing safety standards and supervisory mechanisms for activities involving GMOs and their derived products, and other measures. This new legislation, whose discussion began in October 2003, replaces Law No. 8,974/1995 and other laws that currently regulate activities involving genetically modified organisms and their products in Brazil.

Law No. 11,105, dated March 24, 2005, known as the Biosafety Law, establishes a set of rules and procedures that must be adhered to for the development, importation, use and marketing of GMOs, as well as the issuing of authorization for entry into the country of these products and their derived products, within the competence of the Ministry.

For purposes of the new Biosafety Law, “research activity” is that which is performed in the laboratory, containment system, or field, as part of the process of obtaining GMOs and their derived products or for biosafety assessment of GMOs and their derived products, which includes, at the experimental level, the construction, cultivation, handling, transportation, transfer, import, export, storage, environmental release and disposal of GMOs and their derived products (§ 1 of Article 1).

The rule that only entities of public or private law may develop activities involving GMOs and their derived products still applies, forbidding autonomous individuals from independently performing such activities.

To carry out any research on GMOs and their derived products, authorization from CTNBio is required, which currently provides this through the issuance of the Biosafety Quality Certificate (CQB) (Regulatory Ruling (IN) [Instrução Normativa] No. 1, CTNBio).

This law also requires the creation of an Internal Biosafety Commission (CIBio) for all institutions wishing to develop activities involving GMOs or their derived products, similar to the current legislation, as already mentioned.

According to the text adopted by the National Congress, all members of CTNBio now must have a doctoral degree and professional activity in the areas of biosafety, biotechnology, biology, human and animal health or the environment. These requirements, established by Law No. 8,974/95, were previously restricted to members of CTNBio who were scientists.

Each member of CTNBio has an alternate, who shall work in the absence of the member, and, as such, shall be entitled to vote. The meetings of the Committee shall be convened with fourteen members, and decisions are taken by a majority of members present at the meeting.

So, if fourteen members are present, a project can be approved with eight votes, even though CTNBio is effectively composed of 27 members. It is hoped that this situation will never occur, considering the importance of the issues at hand. CTNBio members should therefore make every effort to attend all meetings and, if prevented, should be represented by their alternates.

A novelty of the new legislation is that CTNBio provides for charging a fee to pay the costs of assessing applications for authorization of research or commercial release of GMOs, to be defined in the Regulation of Law (§ 2 of Article 12).

The responsibilities of CTNBio include establishing regulations for research involving GMOs and their products in Brazil, and authorizing, registering and monitoring these activities.

The crucial point is in paragraph XX of Article 14, which states that CTNBio is responsible for identifying activities and products resulting from the use of GMOs and their derived products which could potentially cause degradation of the environment or cause risks to human health.

This analysis will continue to be made on a case-by-case basis, and only if CTNBio decides that a GMO or its derived product is a potential polluter shall environmental agencies be responsible for performing environmental licensing. In other words, Resolution No. 305/2002 shall be applied only to those GMOs or derived products which CTNBio decides are potentially polluting; in the case of research, it shall be required to obtain a Research Area Operating License (LOAP) [Licença de Operação para Área de Pesquisa] prior to release in the field.

The provisions of item XX of Article 14 are reinforced by § 2 of Article 16 of the new law, which instructs that environmental legislation shall apply only where CTNBio decides that the GMO is a potential cause of significant environmental degradation. Article 37 of Law No. 11,105 amends the description of Annex VIII of Law No. 6,938/1981, added by Law No. 10,165/2000, considering potentially polluting activities only to be the introduction of genetically modified species and the use of biological diversity by biotechnology in actions previously identified by CTNBio as potentially causing significant environmental degradation.

It also confirms § 3 of article 16: “CTNBio deliberates, in the last and final instance, on cases in which the activity is potentially or actually causing environmental degradation, as well as on the need for environmental licensing.”

The finding of CTNBio is binding on the other bodies of the Administration and § 3 of Article 14 provides that in case of a favorable technical decision on biosafety within the research activity, CTNBio shall refer the case to the supervisory bodies and entities of the Ministry of Environment, Health and Agriculture and the Special Ministry of Aquaculture and Fisheries, for them to exercise their duties. This means that the case should be directed to these bodies only in order for them to perform their inspection functions (Item I of Article 16).

Another great victory for research is the end of the requirement for Special Temporary Registration (RET) [Registro Especial Temporário] for genetically modified organisms considered related to pesticides. In fact, Article 39 ends the application of Law No. 7,802/1989 (Pesticides Act) to GMOs and their derived products, except when they are developed to serve as a raw material in the production of pesticides. In such cases, the requirements remain in place for obtaining RET.

Law No. 11,105 establishes the Biosafety Information System (SIB) [Sistema de Informações em Biossegurança] for the management of information arising from the activities of analysis, authorization, registration, monitoring and tracking of activities involving GMOs and their derived products, in order to provide greater transparency and openness in the activities performed by agencies involved in the matter. The data input into the SIB shall be obtained from registration and supervision agencies and entities.

Fines ranging from R$ 2,000 to R$ 1,500,000 are provided for institutions that do not comply with the provisions contained in the new legislation, to be enforced by the supervisory bodies.

Law No. 11,105 also makes it a crime to release or dispose of GMOs in the environment, as well as producing, storing, transporting, commercializing, importing or exporting GMOs or their derived products in non-compliance with the regulations established by CTNBio and by supervisory and registration agencies.

With the publication of the new law it will also become a crime to use, sell, register, patent and license Genetic Use Restriction Technologies (GURTs), which are technologies that induce sterility of seeds. The law, by not clarifying whether it is not considered a crime to do research on those technologies, creates a conflict for researchers, because it makes no sense to research a product whose use, marketing or patenting constitutes a crime.

Law No. 11,105 establishes the National Biosafety Council (CNBS) [Conselho Nacional de Biossegurança], made up of 11 state ministers and reporting to the office of the President of Brazil. The CNBS is responsible for formulating and implementing the National Biosafety Policy, limiting itself, however, to deciding issues regarding the commercial sale of GMOs and their derived products. In the case of research, decisions of CTNBio are final.

With regard to Roundup Ready soybeans, Article 30 of the Interim Provisions of that law states that soybean can be registered and commercialized from the date when the law comes into effect, considering that it has already been approved by CTNBio. However, the CNBS may decide against marketing within 60 days after publication of the law. Article 34 also validates the temporary registration of transgenic soybean plant varieties made with the National Plant Varieties Protection Service (SNPC). Embrapa has 11 plant varieties in this situation.

All Biosafety Quality Certificates, communications and technical decisions of CTNBio remain in force.

Finally, Article 38 of Law No. 11,105 establishes the obligation of the Executive branch to adopt administrative measures in order to expand the operational capacity of CTNBio and the agencies and entities for registering, authorizing, licensing and monitoring GMOs and derived products, as well training human resources in the area of biosafety.

National Technical Commission on Biosafety (CTNBio)

The National Technical Commission on Biosafety (CTNBio) is an agency within the Ministry of Science and Technology, responsible for regulation and release of GMOs in Brazil. Its mission is to authorize the development of research and of genetically modified organisms (GMOs).

The Biosafety Law establishes that research, production, import, traffic and marketing of GMOs depend on authorization by government authority. It is the responsibility of the Ministry of Agriculture, Livestock and Supply (MAPA), through its Plant Traffic and Quarantine Control Division [Divisão de Controle do Trânsito e Quarentena Vegetal], to supervise and monitor all activities and projects related to GMOs and their derived products.

Under Law No. 11,105, CTNBio remains under the Ministry of Science and Technology, but its composition will change from the current 18 members to 27. Of these, 12 are scientists, nine are representatives of ministries involved with the issue, one is a consumer protection specialist, one is a healthcare specialist, one is an environmental specialist, one is a biotechnology specialist, one is a family farming specialist, and one is an occupational health specialist.

Law No. 11,105 dated March 24, 2005 (published in Brazil’s Federal Official Gazette [Diário Oficial da União (D.O.U.)] dated March 28, 2005), regulates items II and V of paragraph 1 of Article 225 of the Federal Constitution, establishing standards for the use of genetic engineering techniques and environmental release of genetically modified organisms, and authorizing the Executive branch to create, under the office of Brazil’s President, the National Technical Commission on Biosafety (CNTBio) [Comissão Técnica Nacional de Biossegurança] (Biosafety Notebooks 1). Provisional Measure No. 2,137, published in Brazil’s Federal Official Gazette dated December 29, 2000, and later, Provisional Measure No. 2,191-8 dated August 23, 2001, make clear the responsibilities of the agency and the ministries involved in overseeing GMOs. Before the Provisional Measure, there were doubts as to the legal existence of CTNBio, whose activities were challenged in court. The claim was that the Commission had been created by decree and was not present in the Biosafety Law (source: MCT, Biotechnology Science and Development site, January 2002).

Internal Biosafety Commissions (CIBio)

Every institution that uses genetic engineering techniques or manipulates, transports, produces or plans to release GMOs into the environment must have an Internal Biosafety Commission (CIBio).

The CIBio must be appointed by the legal guardian of the entity. The entity must recognize the legal authority of the CIBio and provide support for the fulfillment of its duties.

Its responsibilities include monitoring and supervision of work with GMOs and ensuring compliance with biosafety regulations.

The composition of the CIBio should include people with experience to advise on, evaluate and supervise work with GMOs. It should be composed of at least three experts in areas compatible with the organization’s activities. The President of the CIBio shall be appointed by the legal guardian of the entity.

The responsibilities of the CIBio include (Article 10):

Conducting two annual inspections of facilities.

Holding a quarterly meeting and convening special meetings for urgent matters.

Submitting an annual report to CTNBio.

Determining the containment levels and the procedures when working with GMOs.

Caring for the storage, transportation and disposal of GMOs.

Forwarding CTNBio the documentation required for work with GMOs.

Inspecting and monitoring laboratories and certifying their safety.

Evaluating all proposals involving GMOs.

Identifying potential risks.

Making recommendations about risks.

Conveying CTNBio’s key recommendations to researchers.

The institution’s main researcher is responsible for guaranteeing good biosafety practices, including the following:

Becoming familiar and complying with legislation.

Evaluating projects on biosafety, and requesting assistance from the CIBio or CTNBio, when there are questions.

Ensuring that activities with GMOs are not started before receiving authorization from the CIBio/CTNBio.

Reporting any changes.

Communicating imports of GMOs.

Ensuring training of students, trainees or employees about the potential risks of the job.

Communicating changes in the team.

Reporting accidents with GMOs and measures adopted.

Ensuring the maintenance of equipment and infrastructure.

Complying with possible CIBio audits.

Biosafety Quality Certificate (CQB)

CTNBio is the agency which issues the Biosafety Quality Certificate (Regulatory Ruling (IN) [Instrução Normativa] No. 1). The application is made by the interested CIBio, which forwards the application to the Commission and sends the required documents to the legal entity, i.e., name and address of the entity legally responsible for the operating unit, person responsible for the entity, person legally responsible for the operating unit, organizational chart of the operating unit, financial capacity (certificate of absence of unpaid obligations, issued by a notary). In 30 days, CTNBio issues its decision.

In the country, the following must apply for a CQB: national or international organizations developing projects related to GMOs and/or derived products; organizations engaged in technology research and development, and in production or provision of services involving GMOs and/or derived products.

The CIBio must notify CTNBio of any kind of change from what was approved. The CQB may or may not be maintained, depending on the changes. CTNBio, together with the supervisory bodies of the ministries, shall perform annual inspections, maintaining or revoking the CQB (Regulatory Ruling (IN) No. 1).

After applying for the CQB, if it is necessary to submit new documents, the applicant has 90 days to provide them, under penalty of termination of proceedings (Regulatory Ruling (IN) No. 14).

Financial organizations, public and private, national or international, which are interested in funding work with GMOs, by contract or agreement, must require the entity receiving the funding to show the CQB. Failure to comply with this requirement makes them co-responsible for any possible problems.

Biosafety legislation

Brazil has chosen a regulatory model for recombinant DNA technology which provides analysis on a case-by-case basis of individual GMOs before research or environmental releases are performed, to prevent possible risks.

The procedures adopted by CTNBio are internationally recommended and followed by countries that already have been using this technology for over 5 years. The CTNBio has produced twenty Regulatory Rulings (IN) [Instruções Normativas], in order to regulate the procedures to be followed in Brazil so that activities with GMOs can be performed safely (ODA, 2001).

Article 1 establishes safety standards and inspection mechanisms for the use of genetic engineering techniques in construction, cultivation, handling, circulation, marketing, consumption, release, and disposal of GMOs, to protect the life and health of people, animals and plants, as well as the environment.

In order to facilitate understanding and analysis of the material under study, Article 3 (IV) defines a Genetically Modified Organism (GMO) as an organism whose genetic material (DNA/RNA) has been modified by any genetic engineering technique. This law does not apply when the genetic modification is obtained through the following techniques: mutagenesis, formation and use of somatic animal hybridoma, cell fusion, including that of protoplasm, of plant cells, which can be produced by traditional breeding methods; and naturally processed self-cloning of non-pathogenic organisms (Article 4).

Classification of GMOs by risk

Regarding risk, GMOs are classified according to their pathogenicity, since biosafety levels are defined on this basis, i.e. the conditions under which the material can be worked with in order to ensure the state of safety, for either the researcher or the environment.

GMOs which are non-pathogenic are considered to be in Group I, risk class 1. GMOs resulting from a recipient or parental classified as pathogenic, from risk classes 2, 3 and 4, are considered to be in Group II (Annex II – Regulatory Ruling (IN) [Instrução Normativa] No. 1) .

The following GMOs are classified as being in Group I:

Non-pathogenic recipient or parental organism, free of adventitious agents, with a history of safe use or with biological barriers, which, without interfering with optimal growth in the reactor or fermentor, has limited growth, without negative effects on the environment.

Vectors or inserts: they must be well characterized, especially regarding risks to humans and the environment; their size should be limited to sequences of interest; they should not increase the stability of GMOs in the environment; they should not be mobilizable; they should not transmit resistance.

Microorganisms: non-pathogenic, which offer the same safety as the recipient or parental organism in the reactor or fermentor, but with limited survival and/or multiplication, without negative effects on the environment.

Other organisms that: have the conditions in paragraph c, based on a single prokaryotic donor (including plasmids and endogenous viruses) or from a single eukaryotic donor (including chloroplasts, mitochondria, plasmids); organisms composed entirely of gene sequences from different species, but which alter them by known physiological processes.

GMOs from Group II are all those which are not included in Group I.

Risk class is understood as the degree of risk associated with the recipient or parental (host) organism. It depends on the risk class of the vector, of the insert, of the receiver and of the resulting GMO. The categories are classified into four levels:

Risk I: low risk, i.e., does not cause disease to humans or animals.

Risk II: moderate risk, i.e., causes disease to humans or animals, but does not pose serious risks, as there is effective treatment, and it has limited spread.

Risk III: high individual risk, but limited to the community. This represents high risk, but there is treatment and prevention.

Risk IV: presents a high risk to individual and the community; the pathogen poses a threat to humans and animals; it is highly transmissible; there are no preventive measures or treatment.

Based on the risk classes, the Biosafety Level (NB) [Nível de Biossegurança] is defined, i.e., the level of containment necessary to ensure safe work with GMOs.

For laboratories with Biosafety Level 1 (NB 1), the required practices are as follows:

Establish limited access.

Decontaminate once a day.

Decontaminate before disposal.

Use automatic pipettors.

Do not eat, drink or smoke in the environment.

Wash hands before leaving.

Provide easy cleaning. Contaminated material must be removed in sealed containers.

Control the presence of insects and rodents.

For laboratories with Biosafety Level 2 (NB 2), the following practices are required:

Staff well trained and access limited.

Laminar flow chambers or safety cabinets.

Autoclave in or near the laboratory.

Appropriate clothing; vaccination.

Notices indicating the risks.

Appropriate disposal; daily records.

Serum samples from the staff.

Preparation of biosafety manual.

For laboratories with Biosafety Level 3 (NB 3), the following practices are required:

Operate using highly trained personnel.

Handle in security cabinets.

Wear clothing and safety equipment consistent with risk.

Prohibit the entrance of minors under 18 years.

Always decontaminate at the end of working with recombinant DNA/RNA.

Bathe when leaving the laboratory.

Use HEPA air filters.

Manipulation of human cells

The manipulation of human germ cells, as well as intervention in human genetic material in vivo, except for the treatment of genetic defects, are prohibited in Article 8. This article also prohibits the production, storage or handling of human embryos to be used as available biological material.

Thus, according to Article 13, it is a crime to do genetic manipulation of human cells and to manipulate human genetic material in vivo.

Commercialization and industrialization of GMOs

Products containing GMOs intended for commercialization or industrialization, from other countries, may only be released in Brazil subsequent to a conclusive finding by CTNBio and authorization from the Council of Ministers (National Biosafety Council (CNBS) [Conselho Nacional de Biossegurança] – under Draft Law (PL) [Projeto de Lei] 2,401-3).

Biosafety legislation, CTNBio and the environment

Constitutional aspects and legislative power regarding environmental issues and genetically modified organisms are under the jurisdiction of Brazil’s federal government.

Article 24, sections VI and XII of the Federal Constitution established the concurrent legislative power of federal and state governments in relation to the environment and public health.

The Specific Sectoral Committee on Environment, which comprises CTNBio, has jurisdiction in relation to environmental protection regarding the issue of genetically modified organisms.

The requirement for an Environmental Impact Study / Environmental Impact Report (EIA/RIMA) [Estudo de Impacto Ambiental / Relatório de Impacto Ambiental] for activities with significant potential for environmental degradation is presented in Article 225, paragraph 1, item IV of the Federal Constitution and Article 1 of Resolution No. 01/86, from the National Environmental Council (CONAMA) [Conselho Nacional do Meio Ambiente]. Considering activities with GMOs, Regulatory Ruling (IN) [Instrução Normativa] No. 3 from CTNBio and Provisional Measure No. 2,191-9 (Article 1 d) state that this Commission is responsible for identifying activities with significant polluting potential, which must be followed by inspection by the Brazilian Institute of Environment and Renewable Natural Resources (IBAMA) [Instituto Brasileiro do Meio Ambiente e dos Recursos Naturais Renováveis] to continue the process.

Law on access to genetic resources

From the United Nations Conference on Environment and Development (UNCED), held in June 1992 in Rio de Janeiro, a consensus has been emerging among governments around the world regarding the need to combine the conservation of biological diversity with need of States to implement mechanisms to ensure their sovereignty over genetic resources within their territory.

In this context, Brazil, along with 170 other countries, signed the Convention on Biological Diversity (CBD), whose fundamental principles are: promoting conservation of biodiversity, sustainable use of its components and equitable sharing of benefits arising from the use of genetic resources.

After signing the CBD in 1992, Brazil began a far-reaching debate, initiated by then Senator Marina Silva (current Minister of Environment), from the Labor Party (PT) [Partido do Trabalhador] of Acre State (AC), in order for Congress, in addition to ratifying the CBD, to transform it into a federal law, so as to establish mechanisms to protect and regulate forms of access to genetic resources and the knowledge associated with them, taking into account national peculiarities (LIMA, 1998).

On January 3, 1994, the CBD was ratified by Congress through Legislative Decree No. 02, and in 1995 Draft Law No. 306 was introduced by then Senator Marina Silva. This draft law was approved by the Senate in October 1998.

In 1996, the federal government established the Interministerial Group on Access to Genetic Resources [Grupo Interministerial de Acesso aos Recursos Genéticos]. This group aimed to discuss and present a national strategy for the use of genetic resources and present a new Draft Law (PL) to regulate the issue. The Draft Law was brought to Brazil’s House of Representatives in August 1998, as No. 4,751/98.

In 1998, Representative Jaques Wagner, Labor Party (PT) representative from Bahia State, introduced Draft Law No. 4,579/98, based on the Draft Law of Senator Marina Silva, incorporating some innovations and suggestions submitted by NGOs and social movements regarding the issue of sustainable agriculture and the rights of indigenous and traditional peoples (LIMA, 1998).

Law on access to genetic heritage – Provisional Measure No. 2,186-16

Provisional Measure No. 2,186-16 dated August 23, 2001 (re-issue of Provisional Measure No. 2,052-2 dated July 26, 2001), regulates the Convention on Biological Diversity, providing for access to genetic resources, protection and access to associated traditional knowledge, sharing of benefits, access to technology and technology transfer for its conservation.

Decree No. 3,945 dated September 28, 2001, and Decree No. 4,946 dated December 31, 2003, repealing and amending some articles of the first decree (Articles 8, 9 and 12), define the composition of the Genetic Heritage Management Council [Conselho de Gestão do Patrimônio Genético] and establish rules for its operation.

Provisional Measure No. 2,186-16 provides owners and holders of property and rights fair and equitable sharing of benefits arising from access to genetic resources and traditional knowledge (Article 1, § 2).

According to Article 2 (single paragraph), the genetic heritage and natural resources found on the continental shelf and in the exclusive economic zone are the property of the federal government of Brazil and thus only it may authorize their exploitation.

In Article 7, certain concepts are defined for better understanding of that Provisional Measure:

Genetic heritage: information of genetic origin, contained in whole or in part, in a plant, fungal, microbial or animal specimen, in substances originating from the metabolism of living beings and from extracts of living or dead organisms, found in situ, including domesticated, or kept in ex situ conditions, provided that it is collected in situ in the country, on the continental shelf or in the exclusive economic zone.

Associated traditional knowledge: individual or collective information or practices by an indigenous or local community, with actual or potential value, associated with genetic heritage.

Access to genetic heritage: acquisition of samples of components of genetic heritage for scientific research and technological development, bioprospecting or preservation, for the application thereof in industry or otherwise.

Agreement for the use of genetic resources and benefit-sharing: multilateral legal instrument that specifies the parties, the object and the conditions of access and delivery of components of genetic heritage and associated traditional knowledge, and the conditions for sharing benefits.

The Provisional Measure guarantees indigenous and local communities that create, develop, own, maintain or preserve traditional knowledge associated with genetic heritage the right to:

have the source of access to the traditional knowledge indicated in all publications, uses, exploitation and disclosures;

prevent unauthorized third parties from using, testing, researching or exploiting anything relating to the associated traditional knowledge;

prevent unauthorized third parties from disclosing, transmitting or retransmitting data or information comprising or constituting the associated traditional knowledge;

receive benefits, compensation or royalties for economic exploitation by third parties, directly or indirectly, of associated traditional knowledge to which the local or indigenous community owns the rights.

A major opportunity for national research is presented in Article 22 (“From access to technology transfer”), which requires local partnership between companies and foreign institutions wishing to exploit Brazil’s biodiversity.

Article 30 of this Provisional Measure provides certain sanctions for an administrative violation against genetic heritage or the associated traditional knowledge, which range from warnings to fines of up to BRL 50,000,000 (fifty million reais), as determined by the competent authority according to the infraction.

Article 31 provides that all funds obtained from the exploitation of processes and products developed from samples of genetic heritage components (profits, royalties, fines) will be for the National Environmental Fund [Fundo Nacional do Meio Ambiente] (created by Law No. 7,797 dated July 10, 1989), the Naval Fund [Fundo Naval] (created by Decree No. 20,923 dated January 8, 1932) and the National Fund for Scientific and Technological Development [Fundo Nacional de Desenvolvimento Científico e Tecnológico] (established by Decree-Law No. 719 dated 31 July 1969, and restored by Law No. 8,172 dated January 18, 1991).

Article 10 provides for the creation of a Genetic Heritage Management Council [Conselho de Gestão do Patrimônio Genético], composed of representatives from agencies having legal jurisdiction over several issues dealt with by the Provisional Measure. Its powers include: granting authorization for access to associated traditional knowledge, upon prior consent of its owners; and supervising the activities of access to samples and shipment of samples of genetic heritage components to an applicant institution. To enable access to the sample, Article 13 provides for the signing of a Contract for Use of Genetic Heritage and Benefit-Sharing [Contrato de Utilização do Patrimônio Genético e de Repartição de Benefícios]. Decree No. 3,945 dated September 28, 2001 defines the composition and duties of the Genetic Heritage Management Council.

Decree No. 4,946 dated December 31, 2003, amends, repeals and adds provisions to Decree No. 3,945, which regulates Provisional Measure No. 2,186-16. This decree establishes certain duties of the Genetic Heritage Management Council regarding the requirement of documents from applicant institutions for access to genetic resources, traditional knowledge and associated technology transfer.

Genetically modified products (GMPs)

Among important issues pertaining to human health, CTNBio evaluates potential problems related to traits of allergenic proteins expressed by the transgene. It is essential to ensure that no product containing allergenic proteins not found in the conventional product be released for human consumption (ODA, 2001). Another important aspect is the absence of substances which are toxic or which might cause damage to the body or have undesirable interactions with other elements.

It is also important to maintain the nutritional characteristics of food. The use of a genetically modified food should not introduce any variables that might adversely affect human health; on the contrary, in modern times, the development of foods that have improved nutritional characteristics is being encouraged, in order to reduce heart disease, or to provide greater vitamin content.

Safety of genetically modified foods

The use of certain biotechnology allows the food industry to increase productivity and reduce costs, especially by improving the quality of certain products. Thus, thorough assessment of the safety of these products is already clearly established throughout the world. Products approved for commercial sale are those considered safe for consumption.

Procedures for assessing the food safety have been discussed in a consistent and consensual manner among world experts, in the Codex Alimentarius (FAO / WHO).

Food safety is the assurance that food will not cause any damage to the health of the consumer when prepared and/or eaten according to its intended use (WORLD HEALTH ORGANIZATION, 1996, cited by YOKOYAMA, 2001).

Food safety is based on the principle of risk assessment. This procedure consists of four phases:

Identification of hazard.

Characterization of hazard.

Management of risk.

Communication of risk.

Thus, risk is a direct function of hazard and probability (risk = hazard x probability). The risk depends on the level of exposure to the hazard; the existence of the hazard does not, in itself, entail appreciable risk (YOKOYAMA, 2001).

Hazard is understood as a biological, chemical or physical agent present in food, or a condition of the food with the potential to cause adverse health effects.

Risk, in turn, is assessed in accordance with the probability of causing an adverse health effect, and the severity of that effect occurring as a consequence of the hazard (WORLD HEALTH ORGANIZATION, 1996, cited by YOKOYAMA, 2001).

Food safety assessment is required whenever changes are made in the process by which food is obtained, or a new process is introduced. The scope of the assessment will depend on the nature of the observed or perceived hazards (WORLD HEALTH ORGANIZATION, 1991, cited by YOKOYAMA, 2001).

Some elements are common to the assessment of safety of foods and GMOs. They are:

Comparison of the final product with one that already has an established safety standard, usually the conventional counterpart (WORLD HEALTH ORGANIZATION, 1991, cited by YOKOYAMA, 2001);

The most practical model for assessing the food safety of GMOs is to determine if the product obtained by modern biotechnology is substantially equivalent to its conventional counterpart (ORGANIZATION FOR ECONOMIC COOPERATION AND DEVELOPMENT, 1993, cited by YOKOYAMA, 2001).

If the food or food ingredient derived from recent advances in biotechnology is considered substantially equivalent to a conventional food or food ingredient, the former may be considered as safe as the latter (ORGANIZATION FOR ECONOMIC COOPERATION AND DEVELOPMENT, 1993, WORLD HEALTH ORGANIZATION, 1996, cited by YOKOYAMA, 2001).

The safety assessment of genetically modified products occurs in three phases (YOKOYAMA, 2001):

Phase 1 – Safety of the gene, protein or plant:

Choice of genes, proteins: determination of the event of interest (specificity); identification of selection markers.

Source of genes: a survey of the history of safe use and ethical issues.

Environmental and ecological aspects: gene and specific plant variety.

Phase 2 – Biological/agronomical equivalence:

Stringent trials on agronomical performance and its efficacy.

More than 99% are eliminated.

Key assessment step of products of conventional varieties.

Phase 3 – Detailed product safety:

Food.

Animal feed.

Environment.

The scheme to be followed in order to assess food safety has two different focuses. First, clarification of issues relating to the gene and the protein, and then questions intended to check whether the product meets the requirements for substantial equivalence.

Regarding the genetic nature of the insertion, the following should be clarified: the sources, the molecular characterization of the insertion, the number of copies and the integrity of the gene.

Regarding the protein, the following are researched: history of safe use, function, specificity and the mode of action, expression levels, and special attention is given to issues relating to toxicology and allergenicity. In this case, attempts are made identify the sequence of amino acids, digestibility, acute oral toxicity, among other studies.

To clarify issues of substantial equivalence, attempts are made to identify the characteristics (morphological and agronomical) and composition of the food or animal feed (analysis of its composition, nutrients, antinutrients, specific animal development trials).

The methodology for the safety assessment of foods derived from genetically modified plants has been adopted consistently throughout the world. Among the world’s scientific and technical organizations cited by Yokoyama (2001) are:

Food and Agricultural Organization (FAO) – 1991, 1996.

World Health Organization (WHO) – 1991, 1993 and 1995.

International Life Sciences Institute (ILSI) – 1996, 1997.

Organization for Economic Cooperation and Development (OECD) – 1993, 1996, 1999.

International Food Biotechnology Council (IFBC) – 1991.

Authorities and international regulatory agencies include:

UK Advisory Committee on Novel Foods and Processes (ACNFP) – 1991.

Health Council of the Netherlands – 1992.

Nordic Working Group on Food Toxicology and Risk Evaluation – 1991.

European Commission, regulations on Novel Foods – 1997.

Health Canada – 1994.

US Food and Drug Administration (FDA) – 1992.

Ministry of Health and Welfare (MHW) Japan – 1996.

Regulatory Ruling No. 20 – Safety assessment of genetically modified foods

Regulatory Ruling (IN) [Instrução Normativa] 20 dated December 11, 2001, approved by CTNBio (COMISSÃO TÉCNICA NACIONAL DE BIOSSEGURANÇA, 2002), establishes standards for food safety assessment of genetically modified plants or their parts.

According to information from members of CTNBio, the document was drafted to address the court ruling, in the Public Civil Action filed by Brazil’s Institute for Consumer Defense (IDEC) [Instituto de Defesa do Consumidor] and Greenpeace, which states that no genetically modified organism may be released or commercialized in Brazil until CTNBio publishes regulations regarding food safety and labelling of GMOs for human and animal consumption (BOLETIM AS-PTA, 2002 cited by COMISSÃO TÉCNICA NACIONAL DE BIOSSEGURANÇA, 2002).

The Regulatory Ruling was formulated as a questionnaire that aims to answer questions pertaining to the donor organism, the recipient plant, the protein expressed, nutritional quality, allergenicity, among other adverse effects.

The main concerns within each of the topics are as follows:

Donor: traits of allergenicity and/or toxicity.

Recipient: whether the plant is already used as food and traits of allergenicity and/or toxicity.

Protein expressed: whether the level of protein expressed by the transgene is comparable to its content in the donor organism or other food, and whether its biological function presents a risk factor for human or animal health.

Nutritional quality: whether the chemical composition and nutritional value of the food derived from the genetically modified plant, in natura or after processing, is different from the conventional (plant without modification).

Allergenicity: whether there is similarity between the primary structure of the components of the genetically modified plant and known allergens, and immunochemical affinity of the protein specified by the transgene for IgE antibodies in the serum of allergic individuals.

Adverse effects: whether the genetically modified plant produces metabolites that may cause adverse effects to human and animal health, and whether there is evidence of horizontal transfer of the transgene into the genome of humans or animals.

In summary, according to Regulatory Ruling 3, if CTNBio considers that release will cause negative effects on the environment, the application is sent to the Ministry of the Environment, which may require the preparation of an Environmental Impact Study / Environmental Impact Report (EIA/RIMA) [Estudo de Impacto Ambiental / Relatório de Impacto Ambiental] for release of GMOs. Some weak points of Regulatory Ruling (IN) No. 20 have been raised by environmentalists, such as the fact that it only refers to modified plants, disregarding genetically modified animals and, therefore, mixed foods, such as those containing plant and animal ingredients (BOLETIM AS-PTA, 2002, cited by COMISSÃO TÉCNICA NACIONAL DE BIOSSEGURANÇA, 2002).

Labelling of genetically modified foods

Labelling is beyond the powers of CTNBio, being within the scope of the Consumer Protection Code [Código de Defesa do Consumidor]. The labelling of a product is the main channel of communication with the consumer, so it should convey correct information about the nutritional characteristics and composition of the product, allowing a free choice by the consumer. In order for the food to be offered for consumption, it must first of all be safe and provide the required quality. Therefore, the role of CTNBio precedes labelling, because if a GMO is not considered safe, it can never be used for consumption.

Labelling around the world

United States

The FDA’s Statement of Policy on Foods Derived from New Plant Varieties (FDA 1992/96) provides for:

Rules for assessment and verification of food safety.

Recombinant DNA technique considered an extension of traditional methods for developing a new variety.

The principle of substantial equivalence, which derives from the safety assessment for human and animal consumption. According to this, a product is “substantially equivalent” when it is as safe for consumption as its traditional variety, and also when it is identical in purpose of use, in nutritional composition and method of use, handling and preparation.

After approval for human consumption:

It does not require labelling to indicate the method the development of a new plant variety.

It does require labelling of food to indicate changes regarding the following factors: identity, composition, nutritional and health aspects related to use/preparation (i.e., when not substantially equivalent).

Europe

Regulation No. 258/97 of the Parliament/Council of the European Community, which deals with “regulation of novel foods and food ingredients,” provides:

Rules for the safety evaluation of any foods not used significantly for human consumption: derived from GMOs, derived from microorganisms, algae or fungi, isolated from plants or animals, derived from new forms of processing.

Labelling to indicate changes in characteristics and properties capable of substantiation by analysis, as well as their method of production and characteristics.

Indication of the composition and nutritional value or its effects; intended use; health implications; ethical issues; and presence of GMOs.

Regulation No. 1,139/98 of the Council of the European Community, which deals with “regulation on the labelling of certain foods derived from GMOs,” applies only to products based on or derived from corn and soybean.

It describes:

Rules for labelling of products derived from corn and soybean (because they had been approved before Regulation No. 258/97).

Rules based on the presence of genetically modified DNA or protein.

The words “produced from genetically modified ______________________.”

No reporting the absence.

European Community Regulation No. 49/2000 amends Regulation No. 1,139/98, which:

Recognizes that one can not exclude the possibility of adventitious presence of GMOs occurring during cultivation, harvest, transport and storage.

Establishes a maximum limit of 1% for the adventitious presence of DNA and/or protein resulting from genetic modification (combined with the presence of any genetically modified material approved by Regulation No. 258/97).

Applies such limit to the food, when it is made up of only one ingredient per food, and when the food/ingredient is made up of more than one ingredient.

Determines that labelling must be mandatory above the limit.

Regulation No. 50/2000, which deals with “labelling of foods containing additives and flavorings genetically modified or produced from GMOs,” provides:

Compulsory labelling of foods in this condition.

Obligation to inform consumers and mass caterers when the additives and fragrances contained in foods are different in terms of: composition, nutritional value and nutritional effects, when use of these additives and flavorings is different from those of corresponding conventional ones, and also when there are implications for health or ethical issues.

Requirement to include the expression “made from genetically modified __________” in the ingredient list, or at the end of the list with an asterisk.

Switzerland

The local regulation established in 1999 provides:

The ceiling for the presence of DNA of 1%, applied to food ingredients and additives, in order for labelling not to be mandatory.

Negative labelling is allowed when there is less than 1% GMO content, and a corresponding GMO exists, based on the DNA detection. Documentation with evidence should be available.

Australia and New Zealand

ANZFSC – Standard A18 (1998) provides a “standard for foods produced using gene technology,” which:

Prohibits the sale of genetically modified foods which have not been approved by ANZFSC and lists 20 varieties already approved.

Requires labelling when there are significant differences in nutritional composition, antinutritional factors, and health, ethical, religious and cultural implications.

Meanwhile, the new regulation, dated July 28, 2000, establishes:

Mandatory labelling of foods and ingredients when “new” protein and/or DNA (originating from GMOs) are present in the final food.

Each ingredient of the food may contain up to 1% of unintentional genetically modified material.

Excluded: additives and auxiliaries provided that the “new” protein/DNA are not present; flavorings, when the quantity used is less then or equal to 0.1% in the final product and in foods prepared at points of sale.

Some expressions have been proposed in public consultation:

“Genetically modified.”

“May be genetically modified.”

“May contain GM.”

“Not a source of genetically modified ingredients.”

“Without genetic modification.”

Japan

In Japan, food is evaluated by a committee of 18 experts and approved by the Ministry of Health.

The rule for labelling was discussed between May 1997 and April 2000, by an Advisory Committee for Food Labelling, which:

Establishes a limit of 5% for the unintended presence of DNA and or protein derived from genetic modification only for the case of soybeans. Above this limit, labelling is required.

Lists three categories with examples of foods and ingredients, and conditions for waiving labelling requirements.

Three categories for labelling have been defined:

Not equivalent in composition. For example: “genetically modified soya beans with high oleic acid content.”

Equivalent in composition and intended use, with the presence of DNA/protein, and using the expressions: “genetically modified soybean” or “genetically modified soybean not segregated.”

Without segregation or DNA/protein (information about the absence is optional).

Russia

In Russia, the labelling rule, dated July 2000, establishes:

A limit of 5% for the presence of DNA/protein obtained by genetic modification in the ingredients – above which labelling is mandatory.

The use of the term “genetically modified, derived from genetically modified material” and “contains ingredients derived from genetically modified material.”

A list of GM-derived foods/ingredients subject to labelling (soy, corn, potatoes, tomatoes, beets).

A list of additives and biological additives is being prepared.

A list of GM-derived foods/ingredients not subject to labelling.

Labelling of genetically modified foods in Brazil

Environmental release of any GMO for cultivation or for human or animal consumption depends on receiving a technical opinion from CTNBio (Law No. 8,974/95 and Decree No. 1,752/95 – still in force until the date of approval of Draft Law (PL) No. 2,401-03, of February 2004, passed the House of Representatives and now before the Senate).

Decree No. 4,680 dated April 24, 2003 regulates the right to information, provided by Law No. 8,078 dated September 11, 1990, concerning food and food ingredients intended for human consumption or animal feed, containing or produced from genetically modified organisms. This Decree repeals Decree No. 3,871 dated July 18, 2001.

According to Article 2 of this decree, the consumer must be informed, as part of the commercialization of foods and food ingredients intended for human or animal consumption, that they contain or are produced from genetically modified organisms, which are present above the 1% limit. Paragraph 1 subsequently states: “both on packaged goods sold in bulk to or in natura, the label of the container or package (...) must clearly display one of the following expressions, depending on the case: genetically modified (product name); contains genetically modified (name of the ingredient or ingredients); or product produced from genetically modified (product name).” In addition to this information, consumers must also be provided data on the gene donor species, in the place reserved for the identification of ingredients (§ 2). This information must be included in the tax document, i.e., it must accompany the product or ingredient in all stages of production (§ 3).

Foods and food ingredients produced from animals fed with feed containing genetically modified ingredients are also subject to labelling. They must clearly show, “(name of the animal) fed diets containing genetically modified ingredients,” or “(name of ingredient) produced from animals fed diets containing genetically modified ingredients” (Article 3). Foods and food ingredients not containing or produced from genetically modified organisms may optionally use the labelling “(product name or ingredient) free of genetically modified products” provided that there are similar, genetically modified products on the Brazilian market, according to Article 4.

Ordinance No. 2,658 dated December 22, 2003 defines the symbol designating the labelling mentioned in Decree No. 4,680. It was to have entered into force after 60 days, but Ordinance No. 786 dated February 26, 2004, extended its implementation for another 30 days. This will be enforced in a manner complementary to the provisions of the Technical Regulation for Labelling of Packaged Foods, approved by Resolution No. 259 dated September 20, 2002 from Brazil’s National Health Surveillance Agency (ANVISA) [Agência Nacional de Vigilância Sanitária], which is intended to define the shape and minimum dimensions of the symbol which will be included on packaging of foods containing or produced from genetically modified organisms.

According to this ordinance, the symbol must appear on the main panel, clearly displayed and using contrasting colors in order to ensure proper visibility, consisting of a triangle, which shall contain the capital letter T, as follows:

The triangle shall be equilateral.

The default color of the symbol genetically modified, in color printing, must meet the following proportions:

the edges of the triangle and the letter T: 100% black;

the inside background of the triangle: 100% yellow;

the type used for letter T character must be based on the type family Frutiger, bold, uppercase, as shown below;

the area occupied by the transgenic symbol must represent at least 0.4% of the main panel, and may not be less than 10.82531 mm2.

Biodiversity

Concept

Biological diversity and biodiversity include expressions that refer to the variety of life on the planet, or the property of living systems being distinct.

Biodiversity is one of the fundamental properties of nature and the basis for agricultural, livestock, fisheries and forestry activities and also the basis for the biotechnology industry.

According to Edward Wilson, cited by Dias (1998), the number of species of organisms used to be more than 5 million, while recent studies acknowledge a range of 10 to 100 million species. The number of known species is 1.7 million.

Brazil contains 15% to 20% of the total species on the planet (DIAS, 1998). It has the most diverse flora in the world (55,000 described species, or 22% of world total). It has the largest richness of palm species (390 species) and orchids (2,300 species).

Brazil also still presents a high rate of endemism:

One in eleven (of the 522) species of mammals.

One in six (of the 1,622) species of birds.

One in fifteen (of the 468) species of reptiles.

One in eight (of the 516) species of amphibians.

Sectors involved in the use of biodiversity and environmental biotechnology are emerging on the biotechnology scene in Brazil: in the first case, due to the need for screening of native plants, microorganisms and animals hoping to discover genomes, genes and molecules of economic value; and in the second case, due to the demand for bio-processing and utilization of industrial effluents and bioremediation. The two sectors are strategic for the country to establish sustainable development policies. These policies will determine competitiveness in the coming decades (EDGINGTON, 1995; MOREIRA FILHO, 1996).

The more immediate interest in the case of biodiversity comes from pharmaceuticals and agribusiness. One need only recall that the success rate in the discovery of pharmacologically active principles in plants is 1:125, versus 1:10,000 when screening compounds produced from chemical synthesis. Just as it was possible to discover genes that confer disease resistance in commercial varieties of plants, wild plants and microorganisms, it is also possible to “tame” plants for commercial applications (JESUS, 1999).

According to Abreu et al. (1998), agrobiodiversity is a critical component of global biodiversity, and since more than 75% of the world’s food is produced by just over 25 domestic plants and animals, handling and management of these genetic resources is essential for world food security. This fact encounters another great need: increasing productivity and sustainability of production systems. Thus, the identification of plant and animal germplasm, which are highly productive and adapted to ecological conditions, is a global priority, recognized by the United Nations Food and Agriculture Organization (FAO).

Environmental biotechnology involves not only methods of wastewater treatment and bioremediation (with great potential demand in Brazil), but also development of systems for industrial parks, where one industry can use waste from another, or remobilize related residues (MAY; MOTTA, 1994; EDGINGTON, 1995).

The major concern with environmental issues tends to make biological degradation of wastewater a more attractive alternative than natural and chemical methods, due to the fact that it accelerates the degradation process, and is cheaper and more acceptable than chemical methods.

In the case of cyanides, which are potentially toxic compounds to any kind of life – heavily used in the leaching of ores, chemical intermediates, pharmaceuticals (around 3 million tons per year) – biological degradation already uses living organisms such as bacteria, fungi and algae, which possess enzyme systems and specific metabolic pathways capable of metabolizing or transforming these toxic ions into products less harmful to the environment (LINARDI, 1998).

Biodiversity and trends

The increase of animal germplasm banks (AGB) is one of the major possibilities for exploitation of biodiversity. Besides being important to secure supplies of doses of semen and embryos of different races and/or domesticated animal species threatened with extinction (as Cenargen does), many possibilities arise from the freezing of oocytes for two reasons:

The improvement in certain techniques, such as that of embryos collection, will enable achieving certain objectives which are currently unfeasible.

From the time when donors are better characterized genetically, mating may be more focused, resulting in better use of the genetic potential of the stored material.

In this context, it is worth emphasizing the importance of genetic combinations capable of being produced from naturalized breeds, and a greater effort is imperative to mitigate the damage imposed by the rate of loss of animal genetic resources, in view of (ABREU et al. 1998):

The reduction of additive genetic variability in the most economically exploited breeds, requiring donation of genes capable of generating new genetic combinations.

The need for genetic resistance to diseases and parasites, since, for centuries, animals were continuously exposed to the attack of infectious and parasitic organisms, and many of these diseases were controlled naturally, allowing the survival of naturalized breeds.

The conservation of ecosystems that require livestock which historically produce in harmony with the region, with no need for major environmental changes.

Biodiversity products account for 31% of Brazilian exports (especially coffee, soy and orange). The agricultural industry accounts for about 40% of Brazilian GDP, the forestry sector, about 4%, and fishing, about 1% (PROBIO/SP..., 1999).

Through the Convention on Biological Diversity, after the Conference of Parties (COP – four held already), four work programs were created for: Maintenance of Marine and Coastal Biodiversity, Agrobiodiversity, Forest Biodiversity, and Biodiversity of Continental Waters. The Conference also created the Subsidiary Body on Scientific, Technical and Technological Advice (SBSTTA, the Clearing-House Mechanism) and the Financial Mechanism (Global Environment Facility).

National Environmental Policy

Law No. 6,938 dated August 31, 1981, known as the National Environmental Policy, introduced a conceptual difference that served as a watershed. No environmental damage is exempt from repair; strictly speaking, there is no tolerated emission of pollutant. The new legislation is based on the idea that polluting waste tolerated even by established standards can cause environmental damage and therefore subject the party causing the damage to payment of compensation. It is the concept of strict liability, or risk associated with the activity, according to which damage cannot be shared with the community.

The subtle difference lies in the situation where a company is meeting maximum legal pollution standards, and yet may still be held liable for residual damages caused. Thus, it is sufficient to prove a cause and effect link between the activity of a specific company and environmental damage. This is the essence of what is known as strict liability: in order for there to be an obligation to repair environmental damage, it is not necessary for it to have been produced as a result of an illegal act (not meeting the regulatory limits of tolerance, concentration or intensity of pollutants) because strict liability does not require proof of guilt. In short, it is sufficient that the production source has caused the damage, regardless of whether it met the standards prescribed for polluting emissions (MONTEIRO, 1999).

Federal Constitution

The Federal Constitution promulgated in October 1988 devoted an entire chapter to the environment (Chapter VI – The Environment; Title VIII – The Social Order) and, as a whole, contains 37 articles related to environmental law and five others related to urban law.

The Constitution established a number of obligations on public authorities, among which are: (i) the preservation and recovery of species and ecosystems; (ii) the preservation of the variety and integrity of genetic heritage, and supervision of entities engaged in genetic research and manipulation; (iii) environmental education at all school levels and public guidance on the need to preserve the environment; (iv) definition of territorial areas for special protection; and (v) requirement of environmental impact studies for the installation of any activity that may cause significant degradation of the ecological balance.

Criminal sanctions

Law No. 9,605 dated February 12, 1998, establishes criminal penalties applicable to activities harmful to the environment. The purpose of this law is to determine the criminal responsibility of the polluter or party degrading the environment, without any claim to waive Law No. 6,938/81, which regulates civil reparation arising from acts harmful to the environment. Article 2 of that law includes, among the parties subject to criminal prosecution, not those only directly responsible for the damage, but also other agents who were aware of the criminal conduct, and who failed to prevent it.

That law provides custodial sentences for individuals – arrest or imprisonment – as well as penalties restricting rights, established by Article 7, while Article 21 provides the application of fines – restriction of rights and provision of community services.

Provisional Measure No. 1,710-1

On September 8, 1998, Provisional Measure No. 1,710-1 was published, authorizing regional environmental enforcement agencies to enter into terms of engagement with individuals or business entities responsible for the construction, installation, and operation and expansion of activities considered to be actually or potentially polluting. These terms of engagement are designed to bring the activities of individuals and business entities into conformance with the environmental regulations in force, without the risk of imposition of administrative penalties provided for in Law No. 9,605 dated February 12, 1998, during this adjustment period.

National Environmental System

Several federal agencies for the effectiveness of environmental legislation have been instituted: the National Environmental System (SISNAMA) [Sistema Nacional do Meio Ambiente], a regulatory, advisory and deliberative body; the National Environmental Council (CONAMA) [Conselho Nacional do Meio Ambiente]; the Ministry of the Environment, Water Resources and the Legal Amazon (MMA) [Ministério do Meio Ambiente, dos Recursos Hídricos e da Amazônia Legal], the agency charged with coordinating, monitoring and control of the national environmental policy; and the Brazilian Institute of Environment and Renewable Natural Resources (IBAMA) [Instituto Brasileiro do Meio Ambiente e dos Recursos Naturais Renováveis], the executive body.

SISNAMA also includes other agencies of the federal administration, public foundations aimed at protecting the environment, entities of the Executive branch, and at the state and municipal levels (State and Municipal Departments of Environment; Environmental Agencies – CETESB / FEEMA / COPAM / IAP / CRA and others) in their respective jurisdictions.

São Paulo State Program for the Conservation of Biodiversity (Probio/SP)

The State of São Paulo has a specific program for biodiversity within the State Secretariat for the Environment.

The State Program for the Conservation of Biodiversity (Probio/SP) [Programa Estadual para Conservação da Biodiversidade] (PROBIO/SP..., 1999) aims to deploy, in São Paulo State, the Convention on Biological Diversity (CBD), the official international steering document that addresses this issue.

The main objectives of the CBD are: conservation of biodiversity, sustainable use of its components and fair and equitable distribution of the resources arising from such use. These are also the goals of Probio/SP, in addition to the goal of appreciating social diversity.

Genetically modified plants

Regulations for the import of genetically modified plants (GM plants)

These regulations are referred to in Regulatory Ruling No. 2 from CTNBio.

The authorization for introducing GM plants and their parts into the country, represented by small amounts or samples of seeds, live plants, fruits, cuttings, buds, bulbs, tubers, rhizomes, in vitro plants, requires an import permit.

This request must be made to the Department of Plant Protection and Inspection (DDIV) [Departamento de Defesa e Inspeção Vegetal], of the Ministry of Agriculture, Livestock and Food Supply (MAPA) [Ministério da Agricultura, Pecuária e Abastecimento] after the technical finding by CTNBio. It is thus the responsibility of the DDIV to submit the application to the requirements contained in Decree No. 24,114 dated April 12, 1934, and Ordinance No. 148 dated 15 June 1992, from the Ministry of Agriculture, Livestock and Food Supply.

In any case, the material introduced can only be used under containment. The authorization does not allow the conduct of research in the field, which can only be authorized by a conclusive finding from CTNBio, under separate application, after examination of specific documents, in accordance with CTNBio regulations.

Planned environmental release of GMOs

According to Regulatory Ruling (IN) [Instrução Normativa] No. 3, each application filed by the proposing institution to the CIBio shall be reviewed by a Sector Specific Committee [Comissão Setorial Específica] of CTNBio, which may consult the advice of ad hoc consultants when deemed necessary. Generally, eight weeks are required between the receipt of an application and the initial considerations of the Commission. If CTNBio considers that the release will cause negative effects on the environment, it shall be submitted to the Ministry of the Environment, Water Resources and the Legal Amazon (MMA) [Ministério do Meio Ambiente, dos Recursos Hídricos e da Amazônia Legal], which may call for an Environmental Impact Study / Environmental Impact Report (EIA/RIMA) [Estudo de Impacto Ambiental / Relatório de Impacto Ambiental], in accordance with guidelines established in CONAMA Resolution No. 001/86, which could result in recommendations on conditions to be added to the response.

After CTNBio recognizes that a given planned release may proceed, the document of public information (submitted by the applicant) shall be published in Brazil’s Federal Official Gazette [Diário Oficial da União (D.O.U.)].

Progress of the release shall be monitored by the CIBio, following the protocol and objectives presented by the institution and approved by CTNBio.

During analysis, the impacts to be considered include effects on: health, public safety, agricultural production, other organizations, and environmental quality.

Analyses are performed on the basis of questionnaires submitted to the applicant. In addition to a core questionnaire, common to all types of GMOs, specific questionnaires are used.

The core questionnaire refers to the habitat and genetics of the GMO, data on work under containment and other studies on stability, survival, dissemination, as well as experimental procedures, monitoring and planning for biosafety.

The specific questionnaires have certain common concerns, such as:

Other possible effects, other than those envisioned, which may result from the release of the GMO.

Effects of the release on the ecosystem.

Possible existence of records of natural populations of the parental organism in the region, which could facilitate the introgression of the modified gene.

Genetically modified plants

In the case of plants; the questionnaires reflect the main concerns regarding the following procedures: the ability of the GMO to be more competitive in comparison with conventional varieties (B9 and 10); the possibility of cross-pollination (B5); the ease of dispersion of seeds (B6); the possibility of introgression of the inserted gene (B8); the possibility of the modification involving increased toxicity of the plant (B10); and the possibility of risks to the environment (B10 and 11).

Genetically modified microorganisms living in association with animals

The focus of this study is the organisms that make up the intestinal flora of large hosts, or microorganisms externally applied on the skin of animals.

The main concerns that guide the analysis of genetically modified microorganisms (GMMs) living in association with animals are the following: competitive advantage conferred to the host (C4 and 5); interaction with other plants or animals (C6); introgression of the inserted gene into host cells or into other cells in the host (C7); dispersion into the environment (C8 and 9); and their control (C10) or resistance.

Genetically modified microorganisms as vaccines for veterinary use

The analysis to be done in the case of genetically modified organisms as live vaccines for veterinary use is directed towards: (a) durability of the vaccine organism in the recipients (D2); (b) dissemination of the vaccine organism to other, unvaccinated organisms (D3); (c) introgression of the vaccine material into host cells (D5); (d) fate of the vaccinated animals at the end of the trials (D7); and (e) effects of the vaccine in pregnant animals (D9). In addition, safety trials should be analyzed (D9) and the appropriate measures taken, especially in relation to the control, stability and disposal of the material (D11).

Genetically modified microorganisms applied to modify the physical or chemical environment

These microorganisms are those used for the correction of certain environmental factors adverse to the needs of farming, for example, microorganisms that modify the properties of the soil.

The analysis of these microorganisms covers assessing the effects of interaction of the GMO with the local biota (E3 and 7), as well as with associated plants or the environment (E8). It deals primarily with checking: (a) whether the GMO can affect the suitability of plants for human or animal consumption (E4); (b) its effects on soil chemistry (E5) and water quality (E6); (c) as a means of survival and dispersal of the GMO in water and soil (E6); (d) whether the GMO exchanges material with pathogens (E10); and (e) its control (E11).

Genetically modified vertebrate animals (excluding fish)

The main concern that guides the analysis of vertebrate animals refers to the effect that the expression of modified traits may have on behavior, physiology and reproduction of the animal (F2). The analysis also includes: measures for the management and containment of the progeny of experimental animals (F3); processes to be used to minimize the risks of releasing transgenic sequences potentially adverse to human and animal health (F3); possible expression of genetic material in feral animals (domesticated species to be reintegrated into nature – F4); and whether the GMO is able to cross with any native species (F6).

Genetically modified fish and aquatic organisms

For modified aquatic organisms, the analysis focuses mainly on: the question of the possibility of the organism spreading to another habitat (G5 and 9); the influences on regional farming and the environment (G8); and the integration of genetic material into other populations (G7).

Also of concern is the production of new toxins or metabolites that have an effect on parasites or predators (G1).

Invertebrates

The analysis for genetically modified invertebrates is mainly directed to the possibility of the modification affecting their distribution and natural abundance (H6) and the dispersal of the GMO to other environments (H7).

Organisms for biological control

In the analysis of organisms for biological control, the most obvious concern lies in: the direct effects of the GMO on the target species (J1); the spectrum of organisms susceptible (J2); the consequences of the reduction of the target species on the handling of plants and animals of interest to agriculture (J5); and the consequent change in the environment due to this reduction.

It is also important to evaluate the possibility of new genetic traits affecting non-target species (J7).

Organisms for bioremediation

The focus of the analysis of organisms for bioremediation is concentrated mainly on: substances that can be metabolized by the GMO and not by the parental (K2); whether the GMO produces metabolites that may have deleterious effects on other organisms (K4) and whether GMO can disperse from the application site (K7).

Organisms consumed as food

In the case of modified organisms intended for human consumption, the analysis focuses on testing the ability of the GMO to produce metabolites which may cause adverse effects to the consumer. For this purpose, it provides information regarding toxicology, allergic reactions and other adverse effects (L2); it indicates whether the nutritional quality of food could be altered by the introduced genetic modification (L3); and also whether the GMO is able to transfer transgenic sequences to the consumer (L5).

Chapter 3
Biosafety regulations in Paraguay (ALVAREZ, 2000)

Institutional responsibilities

The areas linked to the development of biotechnology are regulated by the following organizations:

Agricultural biosafety: Ministry of Agriculture and Livestock (MAG) [Ministerio de Agricultura y Ganadería].

Human health: Ministry of Public Health and Welfare (MSPBS) [Ministerio de Salud Pública y Bienestar Social].

Seeds: Directorate of Seeds (DISE) [Dirección de Semillas] and National Directorate of Plant Protection (DPV) [Dirección de Protección Vegetal], of MAG.

Environment: Subsecretariat of Natural Resources and Environment (SSERNMA) [Subsecretaría de Estado de Recursos Naturales y Medio Ambiente], of MAG.

Legal framework of regulation of GMOs

Paraguay does not have a specific law to regulate transgenic plants. The implications of the use of genetically modified materials are analyzed within the framework of the general laws of the country by applying the following laws: Law No. 253/93, which approves the Convention on Biological Diversity; Law No. 294/93 on Environmental Impact Assessment; Law No. 385/94 on Seeds and Plant Variety Protection; Law No. 123/91 on Plant Protection; Law No. 96/92 on Wildlife; Law No. 352/94 on Protected Wildlife Areas; Law No. 836/80 on the Sanitary Code, and Law No. 1,334/98 on Consumer and User Protection.

The Seeds Law62 regulates the introduction of exotic varieties. The National Seeds Council [Consejo Nacional de Semillas] is an important institution for understanding and addressing issues related to propagating material. This entity is comprised of representatives from the National Directorate of Plant Protection (DPV), the Directorate of Seeds (DISE), and the Directorate of Agricultural Research (DIA) [Dirección de Investigación Agrícola].

The Law on Plant Protection63 (Law No. 123 of 1991) provides for the Directorate of Plant Protection (DPV) to inspect, take samples, and carry out analyses of evidence of primary products of plant origin, of materials intended for propagation, transported, sold or offered for sale at any time and place, as well as to inspect shops, markets, fruit, ornamental and forest nurseries, and deposits of plant materials.

Process of supervision of release of GMOs

The Agriculture Biosafety Commission (CBA), which reports to the Ministry of Agriculture and Livestock (MAG) and the Ministry of Public Health and Welfare (MSPBS)64, is the body responsible for authorizing the introduction of GMOs into the country for agricultural use. The Commission aims to “... handle, consider and recommend all matters concerning introduction, field trials, research and environmental release of transgenic plants into the country,” and the ministries make decisions based on its findings.

Commission members are employees drawn from various dependencies of MAG involved in this issue, the Ministry of Public Health and Welfare, the Faculty of Agricultural Sciences at the University of Asunción, and members of Paraguay’s Rural Network of Private Organizations for Development [Red Rural de Organizaciones Privadas de Desarrollo] and Network of Environmental Organizations [Red de Organizaciones Ambientalistas].

Agents interested in producing this type of material in the country should fill out a form created for this purpose and submit it to the Technical Secretariat of the Commission, which works in the Directorate of Seeds (DISE) of MAG.

Experience in regulating GMOs

The regulatory framework for biosafety in Paraguay is based on the following laws: the Law on Seeds and Plant Variety Protection, the “Environmental Impact Assessment” Law65, the Law on “New Regulations for Plant Protection,” the “Ratification of the International Covenant Biological Diversity” Act66, the Decree on the “Creation of the Biosafety Commission”, and other regulations concerning the matter. Based on this legislation, Paraguay temporarily banned use for commercial purposes of any genetically modified material or organism.

From the beginning, the Commission considered the application for the introduction of Roundup Ready (RR) soybeans by Monsanto (LOVERA, 2000). While trials were being performed, MAG did not allow field trials of RR soybeans in the 1997-98 crop. In 1999, the Commission was against the introduction of RR soybeans, and MAG decided not to allow the planting of genetically modified material in Paraguayan territory. In the 1999-2000 season, the Biosafety Commission recommended and the Ministry of Agriculture and Livestock authorized experimentation with RR soybean seeds, in order to generate results that make it possible to know the agronomical traits of the new material in the agro-ecological conditions of the country.

The decree of the Commission found that there were numerous issues about environmental risks and human health, since the material had not been experimented with in the local environment, because the country lacks adequate resources and scientific personnel for such a task. MAG’s argument was based on rejection of transgenic products from Paraguay by major overseas markets. The environmental and commercial reasons reinforce the country’s application of the precautionary principle, adopted at Earth Summit 1992.

Some companies had also tried to get approval to introduce Argentinian Bt corn into the country, but the Commission has positioned itself against this. One of the arguments used was the frequent use of up to 3% of corn grain for reproductive purposes, putting the nation’s 14 most important domestic varieties at risk of contamination. This resolution was reconsidered and finally the entry of Bt corn was approved for the sole purpose of industrial processing.

In 1999, MAG Resolutions No. 554/99 and No. 82/99 established a temporary ban on commercial use of any genetically modified material or organism during the 1999-2000 season, a decision that was renewed in 2000-2001 season67. Under this regulation, the seeds/grains of transgenic soybeans harvested in the 1999-2000 season cannot be used as seeding material.

The resolutions call attention to the importance of the issue for the export of grain and industrial derivatives, which represent a high percentage of currency inflow into the country. It is also argued that Paraguay is a signatory to the precautionary principle, Principle 15 of Agenda 21, approved at the Earth Summit held in 1992 (ECO 92), and ratified by Law No. 253/93, which states: “In order to protect the environment, States should apply the precautionary approach widely, within their capabilities. Where there are threats of serious or irreversible damage, lack of full scientific certainty should not be used as a reason for postponing cost-effective measures to prevent environmental degradation” and “a regulatory framework is needed to ensure and guarantee the biosafety measures necessary to protect the potential of agro-ecosystems.”

National perspectives on the introduction of other mechanisms

Under the institutional aspect, a technical cooperation agreement was signed between MAG and the FAO. One of the outcomes was the development of a draft Law on Biosafety, which would have a more solid basis.

Chapter 4
Biosafety regulations in Uruguay

General features of the regulatory system

The regulatory system of Uruguay, in the main areas of biotechnology development, is composed of various governmental institutions. The Ministry of Livestock, Agriculture and Fisheries (MGAP) [Ministerio de Ganadería, Agricultura y Pesca] has jurisdiction over the agricultural sector, agrochemicals, seeds and in the veterinary field. Environmental issues are the responsibility of the Ministry of Housing, Environment and Land Use Planning (MVMAOT) [Ministerio de Vivienda, Medio Ambiente y Ordenamiento Territorial], and human health is the responsibility of the Ministry of Public Health (MSP) [Ministerio de Salud Pública].

In the veterinary field the regulatory framework established by Mercosur applies68, which was drawn up with participation by government officials and private entrepreneurs in the sector. The regulation was approved by Decree No. 160/97, with more requirements than those agreed upon in the Mercosur bloc. The authorizations of recombinant vaccines are considered on a case-by-case basis. To date, only one imported recombinant vaccine has been approved, for use in small animals.

The Ministry of Public Health (MSP) has the responsibility to formulate regulations regarding control of drugs, food and environmental health. The Department of Drug Control [Departamento de Registro, Uso y Control de Medicamentos], which belongs to the Quality Control Division [Division Control de Calidad] of the General Health Directorate [Dirección General de la Salud] of the Ministry of Public Health, authorizes and registers the drugs to be commercialized in the country. The Ministry is in the initial regulatory organization phase.

The National Directorate of Environment (DINAMA) [Dirección Nacional de Medio Ambiente] is responsible for formulating, executing, overseeing and assessing the National Environmental Protection Plans and as well as for proposing and implementing national policy on the matter. It is the enforcement authority of Law No. 16,466 which states that it is in the national public interest to protect the environment against any degradation, destruction or contamination, and to prevent any negative or harmful environmental impacts. The law considers harmful or negative environmental impacts to be any change to physical, chemical or biological properties which is caused by any form of matter or energy resulting from human activities which directly or indirectly affects the health, safety or quality of life, and the configuration, quality and diversity of natural resources. There are general regulations that do not specifically address the field of biotechnology.

Uruguay does not have a National System for Total Quality. This activity is performed by a National Quality Committee, which is a project of the Presidency of the Republic, whose purpose is to organize, direct and coordinate a National Quality Program. It was established by Decree No. 177 dated April 1, 1991. Its mission is to stimulate awareness of the transcendent importance of the quality level of the population’s well-being and to facilitate the implementation of modern quality management technologies in order to increase customer and user satisfaction and the survival, efficiency, growth and competitiveness of both public and private organizations.

The Technology Laboratory of Uruguay (LATU) [Laboratorio Tecnológico del Uruguay] provides a wide range of services to industry. Its main areas are: technology, analysis and testing, foreign trade and export promotion, and regulation and supervision of weights and measures. Its foreign trade area regulates the temporary admission system, which benefits industry in the development of production destined for export, exempting inputs from taxes or duties. This is a stimulus designed to increase local production, enabling it to compete with international markets on quality and price. LATU is considered key to the strategy for the development of the country in the field of biotechnology.

Biosafety and risk assessment of genetically modified plants

The assessment of genetically modified plants began in 1993 when experts from the Ministry of Livestock, Agriculture and Fisheries (MGAP) [Ministerio de Ganadería, Agricultura y Pesca] argued that the development of some technologies for transgenic plants would represent a reduction of deadlines for applications for introduction of such varieties in the country (PERALTA, 2000). From that time, when the first applications for the introduction of transgenic corn resistant to Lepidoptera appeared, until the present, cases were handled pertaining to various kinds of transformations including herbicide tolerance in crops of corn, soybeans, rice and eucalyptus, as well as low lignin content in the same genus.

As a result of those requirements, the Commission on Risk Analysis for the Introduction of Transgenic Plant Materials (CAAR) [Comisión Asesora de Análisis de Riesgo para la Introducción de Vegetales Genéticamente Modificados] was created, within the framework of the General Directorate of Agricultural Services (DGSA) [Dirección General de Servicios Agrícolas] of the Ministry of Livestock, Agriculture and Fisheries (MGAP) (PERALTA, 2000). DGSA is the area responsible for organizing and developing the protection of plant health and quality, and quality of plant foods and agricultural inputs, through the generation of regulatory and operational tools that allow economic agents to develop their activities in a transparent and equitable manner, improving productivity, quality and competitiveness of agricultural production and agribusiness. It also contributes to protect public health, the environment, the agro-system and consumer rights.

The Commission was composed of representatives of the National Institute of Agricultural Research (INIA) [Instituto Nacional de Investigación Agropecuaria], the National Seeds Institute (INASE) [Instituto Nacional de Semillas], the National Directorate of the Environment (DINAMA) [Dirección Nacional de Medio Ambiente] and the General Directorate of Agricultural Services (DGSA), from a wide variety of backgrounds, involving agronomists, experts in environmental assessment, chemists and molecular biologists, as well as lawyers. In 1998, the Commission requested the inclusion of a representative from the Ministry of Housing, Environment and Land Use Planning (MVMAOT), a request that was fulfilled in 1999.

The conceptual approach introduced by the Commission, in force to date, covers the study of the organism’s traits, its potential to induce genetic changes in populations, and monitoring and control of the accessible environment. To determine the level of environmental safety, risks to human health and natural ecosystems are considered, and the ability to manage its introduction and monitoring in a planned manner in order to ensure the trial’s safety. Predictions are also made regarding adverse environmental effects, potential for transformation of the organism and its environmental impacts and evaluation of the chances of its survival after the trial69.

The risk analysis considers each of the operations or applications performed with transgenic plants. It examines the organism and the molecular biology of the donor-recipient-vector system used for the production of the genetically modified plant, the location where they were all produced, the objectives of the introduction and, especially, a detailed description is made of the proposed biosafety methods and procedures. Where relevant, the following information is also required: the fate of harvested products, the parcels of land managed, its future uses and subsequent controls, as well as contingency plans if there is possibility of escape.

The stages of assessment and risk management have their own requirements. The information must be scientific, well-founded, published, and refereed. Experience or familiarity with the organism is important because it is quite likely that many organisms which are currently considered very hazardous, after some years will no longer pose the same hazard as they currently do, once a routine process of evaluating their use has been generated. Consideration should be given to the intended application for this particular organism, since different applications have varying levels of risk. Finally, there must be an effective surveillance program, monitoring process and adequate control of the location proposed for release.

Commission on Risk Assessment of Genetically Modified Plants (CERVGM)70

Introduction into the territory and use and handling of genetically modified plants and their parts should be implemented as soon as a risk assessment on scientific grounds has been performed, to consider their impact on the environment and biological diversity, taking into account the possible effects on human and animal health and plant safety. DGSA of MGAP, and INASE, have received advice from the Commission on Risk Analysis for the Introduction of Transgenic Plant Materials (CAAR) and processed applications for the introduction of genetically modified plant materials. The accumulated experience and nature of the risks involved have established the advisability of conducting risk assessments using a multi-disciplinary technical scope, with the participation of MSP and MVMAOT, for which for a national coordination body has been organized to advise the Executive branch on biosafety of genetically modified plant materials and parts.

As a result of the foregoing, the Commission on Risk Assessment of Genetically Modified Plants (CERVGM) [Comisión de Evaluación de Riesgo de Vegetales Genéticamente Modificados] has been established. The introduction, use and manipulation of genetically modified plant and their parts, in whatever the form or regime they are performed, can only be done with prior approval of the competent authorities. Authorizations will be considered for the following applications:

Establishment of safe conditions for use under confinement.

Conducting tests and trials in the field or under confinement within the specific biosafety conditions.

National assessment of plant varieties.

Seed multiplication.

Production or import for the first time intended for direct consumption or for processing.

The competent authorities are: the Ministry of Livestock, Agriculture and Fisheries (MGAP) and the Ministry of Economy and Finance [Ministerio de Economía y Finanzas] for the approval of the application set forth in item (e) above and other applications not specifically provided for. These provisions shall not affect the powers of the Ministry of Public Health, as sanitary inspector for foods and medicines, nor those of the Ministry of Housing, Environment and Land Use Planning (MVMAOT)71.

The Commission on Risk Assessment of Genetically Modified Plants (CERVGM) is composed of one representative from each of the following entities:

Ministry of Livestock, Agriculture and Fisheries (MGAP), who chairs the Commission.

Ministry of Housing, Environment and Land Use Planning (MVMAOT), who serves as vice-chair.

Ministry of Public Health (MSP).

National Seeds Institute (INASE).

National Institute of Agricultural Research (INIA) [Instituto Nacional de Investigación Agropecuaria].

The representatives and their subordinates, who should be technicians in risk analysis and biosafety, are designated by the above-mentioned entities. The Commission works under the General Directorate of Agricultural Services (DGSA) [Dirección General de Servicios Agrícolas] of the Ministry of Livestock, Agriculture and Fisheries (MGAP), which provides administrative support and the technical secretariat.

The Commission on Risk Assessment of Genetically Modified Plants (CERVGM) has the following duties:

Developing guidelines for the implementation of risk assessments.

Performing scientifically objective analysis on a case-by-case basis.

Advising the competent authorities on the authorizations established.

Advising the competent authorities on the handling, risk management and risk communication measures which should be taken in each case.

Advising the Executive branch on biosafety of genetically modified plants and parts.

The Commission has the power to: (a) approve procedures for processing applications; (b) form working groups as it deems necessary; and (c) request advice of experts from universities and research centers, public or private, and independent experts recognized for their technical competence, acting in a personal capacity.

Before adopting a resolution, the corresponding competent authority makes available in its offices the authorization application, the results of risk assessment and other relevant documentation, so that anyone interested can access them and provide input in writing. In such a situation, it issues a notice to be published in the Official Gazette [Diario Oficial y del Registro Nacional de Leyes y Decretos] by the applicant and in two national newspapers, within a period of 20 days. In regards to authorization applications as set forth in item (e) or for applications not specifically provided for, the competent authority shall convene a public hearing for information and consultation, at a date later than the expiration of the period indicated on the manifest in the previous item (d).

In Uruguay, only transgenic soybean resistant to glyphosate is authorized for commercial production. Uruguay is cultivating 800 ha of transgenic soybean and unknown quantities of Bt corn. Being a relatively small country, Uruguay is influenced in contradictory ways by its two large neighbors, Argentina and Brazil, which are developing two distinct official strategies. Argentina is the second largest producer of genetically modified soybeans in the world, while in Brazil, only recently (since 2003) was commercial planting approved (Provisional Measure No. 113. of 2003).

Cartagena Protocol on Biosafety

In the process of negotiation of the Protocol on Biosafety, within the framework of the Convention on Biological Diversity, Uruguay is a member of the so-called Miami Group, composed by the United States, Canada, Argentina, Australia and Chile. Chile, which traditionally supports the importance of respecting the biosafety of the environment, opposes its use as a disguised barrier to international trade. Thus, these countries reject labelling and argue that the Protocol should not affect, in any case, the rights and obligations of the agreements of the World Trade Organization.

During discussions, the group rejected the introduction of the Protocol of processed food products, as well as products derived from genetically modified organisms, restricting the application of the treaty only to those GMOs exclusively meant for intentional release in the importing country. Uruguay signed the Cartagena Protocol on Biosafety on June 1, 2001, but has not ratified it.

Legislation promoting biotechnology development

Uruguay is a pioneer in establishing regulations promoting biotechnology development in the country. For this purpose, the National Committee for Biotechnology [Comité Nacional de Biotecnología] was created, under the Ministry of Education and Culture (MEC) [Ministerio de Educación y Cultura]72. The measure was a result of consideration of the importance and development of biotechnology and its processes in the following sectors: human health, pharmaceuticals, energy, and food, and in important aspects of animal health and cutting-edge technology in agriculture. In Uruguay, research is being developed on these technologies, in various public and private agencies, which requires coordination of development and better communication between institutes and companies performing biotechnology research and/or development work.

The National Biotechnology Committee is comprised of two delegates from Uruguay’s University of the Republic (UR), a delegate from the Clemente Estable Institute of Biological Research (IIBCE) [Instituto de Investigaciónes Biológicas Clemente Estable], two delegates from the Chamber of Industry and one delegate from each of the following agencies: the National Scientific and Technical Research Council (CONICYT) [Consejo Nacional de Investigaciones Científicas y Técnicas], the Ministry of Agriculture and Fisheries (MGAP), the Ministry of Industry and Energy (MIE) [Ministerio de Industria, Energía y Minería], the Ministry of Public Health (MSP), and the Ministry of Education and Culture (MEC). In 1987, the government issued Decree No. 626, on Biotechnology Research and Development, which promotes the tasks of research and development in companies, with emphasis on biotechnology.

These initiatives have expired and have not been replaced by new policies. In March 2001, significant steps were taken to develop a new policy phase for science, technology and innovation in biotechnology, through the Center for Prospective Technological Studies [Observatorio de Prospectiva Tecnológica], supported by the United Nations Industrial Development Organization (UNIDO), and reporting to the Presidency of the Republic, on the personal initiative of President of Uruguay, Jorge Batlle.

Part 5
Regulation of biotechnology in the organization of Mercosur

Chapter 1
Legal and institutional aspects of the organization of Mercosur

The legal rights linked to the organization of Mercosur have73 special features that clearly differentiate it from other international experiences in community law. The internationalization of economic laws on industrial property or intellectual property rights places a high importance on the design of national legislation on the subject, limiting the scope for national action. In the Uruguay Round of the GATT negotiations, agreements began to indicate their linkage or non-linkage to the GATT – which meant that advantages in the area of customs duties on trade were lost.

The United States, starting with the Uruguay Round, began to emphasize regional preferential agreements and sign free trade agreements first with Canada, then the trilateral agreement between Canada, the United States and Mexico, and is currently driving the creation of Free Trade Area of the Americas (FTAA). This context of increasingly international economic law, intellectual property rights and overlapping integration projects forms the background for negotiation of intellectual property in Mercosur.

Through the political will of countries, an institutional and legal structure was organized which would allow immediately incorporating agreements established in Mercosur into national legislation. The 1991 Treaty of Asunción created a limited institutional structure for Mercosur, consisting of the policy-making Common Market Council (CMC) [Consejo del Mercado Común], made up of the Ministers of Economy and Foreign Affairs, and the Common Market Group (GMC) [Grupo Mercado Común], which is the executive body responsible for implementing policy, made up of the Secretaries of State for Economic Affairs and Foreign Relations. The Treaty did not specify the legal weight of these bodies’ decisions.

In December 1994, the Ouro Preto Protocol was adopted, which extended the institutional consolidation, adding a Mercosur Trade Commission (CCM) [Comisión de Comercio del Mercosur]. A trio of bodies was established, respectively called the Political Body, the Executive Body and Segment Commercial Body. Under the Protocol, these bodies have the power to formulate regulations which are binding on the participating states, i.e., Common Market Council Decisions, Common Market Group Resolutions and Mercosur Trade Commission Directives are linked to the States, which should incorporate them into their laws, to be enforced by the inhabitants of these countries.

In practice, however, there is a major crisis in terms of incorporating regulations approved at the Mercosur level into the internal legal and regulatory systems of the four Mercosur member countries (Brazil, Argentina, Uruguay and Paraguay), due to policy fluctuations on the part of the four participating countries and business and economic difficulties affecting development of the integration process. The incorporation of Mercosur regulations into domestic regulations was for some time neglected, but in 1995, it was given a new impetus.

It is possible to distinguish between two types of CMC Decisions, GMC Resolutions and CCM Directives: those which need to be incorporated at the legislative level, and those that which can be incorporated at the administrative level. There is a list of what still remains be incorporated, and countries have highlighted the remaining areas of difficulty. Among the resolutions adopted, a decision was included to “make a request, through the CMC, to the Joint Parliamentary Commission (CPC) [Comisión Parlamentaria Conjunta] of Mercosur, for it to arbitrate the means by which the legislature of each member state should prioritize draft laws of Mercosur-approved regulations which are before their legislatures, and which need to be incorporated via legislation.”

This is the case for the protocols on intellectual property, which need to be incorporated by legislative means. Other agreements can be incorporated by administrative means, although this does not eliminate the problems. Some countries have expressed difficulty in identifying the administrative division which has specific competence. The legal-institutional structure of Mercosur is so particular that there is no direct incorporation of the measures approved by the four member states into their respective national laws. This often hinders the effectiveness of agreements approved by the negotiators.

Intellectual property rights are often implemented through protocols approved by the CMC. This decision gives the protocol a “Mercosur status,” incorporating it into the regulations of the Mercosur bloc and introducing it into the system of dispute settlement. That is, these implementations are approved by decision of the CMC, so that they can be incorporated into the regulations of the Mercosur bloc countries and be subject to claims arising from the system of dispute settlement. The protocols are legal instruments that can not be promulgated separately – this is a condition for belonging to Mercosur.

The agreements, in turn, are not an integral part of the Treaty of Asunción. Some countries tend not to approve protocols that are part of the Treaty of Asunción, giving this type of instrument the character of an agreement, in order to promulgate it independently. This would be acceptable for a free trade zone; however, if the intention is to reach a common market, protocols which harmonize substantial economic legislation, governing the rights of individuals regarding protection of intellectual property rights, should be community-wide; that is, they constitute a legal and regulatory system in which each country must participate. To date, all protocols are subject to claims within the dispute settlement system of Mercosur and form an integral part of the Treaty of Asunción.

Chapter 2
Regulation of intellectual property

Introduction

The scope of legislation related to intellectual property rights, despite the major importance it has for the development of businesses and inventors, is being developed slowly. The main area in Mercosur with responsibility for negotiation on Intellectual Property is Work Subgroup [Subgrupo de Trabajo] No. 7 (SGT-7): “Industry,” although some issues, such as Cooperation in Breeder’s Rights, have already been discussed within the framework of Work Subgroup No. 8 (SGT-8): “Agriculture.”

Protocol on Harmonization of Regulations on Intellectual Property74

The Protocol on Harmonization of Intellectual Property in Mercosur on Matters of Trademarks and Indications of Provenance and Appellations of Origin was approved by Decision of the Mercosur Common Market Council (CMC) on the basis of Recommendation No. 7/94, from Work Subgroup No. 7 (SGT-7): “Industry”. Its goal is to promote adequate and effective protection of intellectual property rights relating to trademarks, indications of provenance and appellation of origin. In this sense, it establishes rules and principles for the implementation of these rights.

The Protocol aims to reduce the various interpretations and impediments to trade and movement of goods and services in the territory of the Treaty of Asunción member states, based on promoting adequate and effective protection of intellectual property rights, and establishing rules and principles that will help guide administrative, legislative and judicial actions, in each of the four member states.

The rules and principles are in conformance with regulations established in international multilateral instruments, in particular the Paris Convention for the Protection of Industrial Property (Stockholm Act of 1967) and the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) dated April 15, 1994, annexed to the agreement establishing the World Trade Organization, at the Uruguay Round of the GATT negotiations.

States should ensure effective protection of intellectual property, relating to trademarks, indications of provenance and appellations of origin, ensuring the protection derived from the principles and standards set forth in this Protocol. They may provide a broader protection, provided it is not incompatible with the rules and principles of the international treaties mentioned above. States should grant to nationals of other countries treatment no less favorable than that granted to their own citizens in the protection and exercise of intellectual property rights relating to trademarks, indications of provenance and appellations of origin.

Finally, Article 24 provides that member states should undertake to make efforts to conclude, without delay, additional agreements on patents, utility models, industrial designs, copyrights, and other matters relating to intellectual property.

Cooperation and facilitation in protection of new varieties of plants75

This agreement arose from the determination that the laws of the four Mercosur countries should adapt to the 1978 Act of the International Union for the Protection of New Varieties of Plants (UPOV 78). Also considered was Decision No. 8/95 of Mercosur’s Common Market Council (CMC), which approved the Protocol on Harmonization of Intellectual Property in Mercosur on Matters of Trademarks and Indications of Provenance and Appellations of Origin, establishing in Article 21 that “member states shall provide protection to plant varieties and other plant-breeding activities by a patent system, a sui generis system, or any combination thereof.”

This CMC Decision includes consideration of national treatment, under which nationals of a member country, either individuals or legal entities, that are domiciled in the territory shall enjoy, in respect of recognition and protection of the breeder’s rights, in each of the other member states of the treaty, any legal treatment which the laws of the other member state grant or may later grant for its citizens, provided they meet the conditions and formalities imposed upon nationals of the member state mentioned.

An application for granting breeder’s rights can only be directed to a variety which has the same denomination in all member states. Each member state shall record the denomination proposed, unless it is inadequate under Article 13 of UPOV 78, or is inadequate in the territory of that member state. In this case, it shall require the breeder to propose another denomination.

States shall arbitrate the means necessary to obtain an appropriate harmonization of the methods and technical criteria used to verify compliance regarding differentiation, homogeneity and stability of plant varieties. They shall also arbitrate the means to obtain adequate harmonization of requirements and administrative procedures of requests for protection of plant varieties.

Member states of the Mercosur bloc, through their respective enforcement authorities for the protection of plant varieties, shall arbitrate the means for them to be able to manage, promote or support the incorporation of new genera or species into the breeder’s rights system of another member state. The member states of Mercosur shall publish a catalog of plant varieties, indicating the materials registered in the records of each member state.

Protocol on Harmonization of Regulations
on Industrial Models and Designs76

The purpose of the Protocol for Harmonization of Regulations on Industrial Models and Designs in Mercosur, approved by Decision of the Mercosur Common Market Council (CMC), is to establish rules and principles that serve to implement Intellectual Property Rights in Matters of Industrial Design. It recognizes the need to establish rules and principles to guide the administrative, legislative and judiciary actions of each member state in recognizing and enforcing intellectual property rights in the area of industrial design.

Mercosur member states undertake to observe the rules and principles of the Paris Convention for the Protection of Industrial Property (Stockholm, 1967) and the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) (1994). The Protocol includes provisions on national treatment, non-overlapping systems of protection, and rights and requirements of protection. It excludes protection of industrial designs determined essentially by technical, functional or artistic considerations, or those that do not serve as a model to be manufactured industrially. Member states ensure effective protection, according to the principles and provisions of the Protocol. Nevertheless, they may provide a broader protection, provided it is not incompatible with the rules and principles of the treaties mentioned above.

Registration shall last at least 10 years from the date of application. Member states undertake to provide, in their legislation, a renewal of at least 5 years. The owner of a protected industrial design shall have the right to prevent third parties from manufacturing, selling or importing articles bearing or embodying a design, even copied, or a copy of the protected design, without the owner’s consent, if these acts are done for commercial purposes. Member states undertake to use the International Classification of Locarno, at least as a supplement to their own national classifications.

Chapter 3
Regulation of biosafety

Introduction

Work Subgroup No. 8 (SGT-8): “Agriculture”, and to a lesser extent, Work Subgroup No. 6 (SGT-6): “Environment”, have been the main sources of relevant standards. Other standards, to complement the general provisions above, originated in the recommendations of Work Subgroup No. 3 (SGT-3): “Technical Regulations.”

Background on agricultural biotechnology

The first important background event regarding agricultural biotechnology was the Regional Workshop for Harmonization of Biosafety in the Southern Cone: Oversight of Transgenic Plants, [Taller Regional para la Armonización de la Bioseguridad en el Cono Sur: Supervisión de Plantas Transgénicas] held in Buenos Aires, on November 16-20, 1992, organized by the Inter-American Institute for Cooperation on Agriculture (IICA) and the International Service for the Acquisition of Agri-biotech Applications (ISAAA)77.

Later, during the 2nd Latin American Meeting on Plant Biotechnology [Encuentro Latinoamericano de Biotecnología Vegetal], held in Puerto Iguazú, Argentina, on June 4-9, 1995, several technicians from the region agreed on the need to identify proposals for action for the establishment of standards and monitoring mechanisms for national field trials and marketing of transgenic materials, harmonized among the Southern Cone countries

For this reason, the Meeting on Biosafety and Marketing of Genetically Modified Organisms in Mercosur [Reunión sobre Bioseguridad y Comercialización de Organismos Modificados Genéticamente en el Mercosur] was held in Buenos Aires on September 19-20, 1995, organized by Argentina’s Ministry of Agriculture, Livestock and Fisheries (SAGPyA today), with the prognosis of the Cooperative Program for the Agro-Alimentary and Agro-Industrial Technological Development of the Southern Cone (PROCISUR) [Programa Cooperativo para el Desarrollo Tecnológico Agroalimentario y Agroindustrial del Cono Sur]. The objectives were to identify actions to harmonize regulatory and oversight procedures for developing and marketing GMOs in the region. The main recommendations were:

Urgent development of national advisory committees and regulations in those countries where none exist.

Commitment to further studies on regional harmonization of biosafety in agriculture, with special emphasis on commercialization of transgenic plants.

Agreement on the structure of a regional database.

On March 5-7, 1996, the Regional Workshop on Biosafety in Agricultural Biotechnology: Towards the Commercialization of Genetically Modified Plants and Vaccines [Taller Regional sobre Bioseguridad en Biotecnología Agropecuaria: Hacia la Comercialización de Vegetales y Vacunas Genéticamente Modificados] was held in Buenos Aires, organized by Argentina’s SAGPyA and the UK’s Department of Environment, with the participation of PROCISUR, the Argentina Foundation [Fundación Argentina] and the British Embassy in Argentina. One of the objectives of the workshop was to contribute to formulating common criteria among the Southern Cone countries in matters of biosafety in agricultural biotechnology. The main product of the workshop was an agreement on regional cooperation, which aimed to:

Design and agree on standard criteria in decision making for environmental release and commercial marketing of GMOs and their derived products.

Create a regional database to increase knowledge regarding GMOs and their environmental releases.

Establish systems for information exchange.

Mercosur Framework Agreement on the Environment78

The Mercosur Framework Agreement on the Environment [Acuerdo Marco sobre Medio Ambiente del Mercosur] was approved by Decision of the Mercosur Common Market Council (CMC). Its objective is sustainable development and protection of the environment, through the coordination of the economic, social and environmental dimensions, to contribute to a better quality of the environment and people’s lives. This agreement shall remain in force indefinitely and shall enter into force 30 days after the deposit of the instrument of ratification by the fourth of the four Mercosur member states.

Its considerations refer to the importance of environmental issues within the agenda of consolidating and enhancing Mercosur, emphasizing that it is essential to enable sustainable development through cooperation among member states and declaring the need for a legal framework to regulate the actions of protecting the environment and conserving natural resources in Mercosur.

The member states reaffirm their commitment to the principles enunciated in the Rio Declaration on Environment adopted at the United Nations Conference on Environment and Development in Rio de Janeiro in 1992. In their efforts to obtain the tools to help apply these principles, member states should be guided by:

Promoting the protection of the environment and the efficient use of available resources through the coordination of sectoral policies, based on the principles of gradualism, flexibility and balance.

Incorporating the environmental component into sectoral policies and including environmental considerations in decision-making adopted in Mercosur in order to strengthen integration.

Promoting sustainable development through mutually supportive environmental and economic sectors, while avoiding the adoption of measures which arbitrarily or unjustifiably restrict or distort the free movement of goods and services in Mercosur.

Giving priority and integral treatment to the causes and sources of environmental problems.

Motivating the effective participation of civil society in environmental issues.

States shall extend their analysis of environmental problems in the sub-region, with the participation of national authorities and civil society organizations, and should implement, among others, the following actions:

Increase the exchange of information on environmental laws, regulations, procedures, policies and practices, as well as their social, cultural, economic and health aspects particularly those that affect trade or competition.

Seek to harmonize environmental legislation, taking into account the different environmental, social and economic realities of Mercosur.

Encourage scientific research and development of clean technologies.

Provide information on environmental emergencies or disasters that may affect the other member states, and provide technical and operational support.

Regulatory Framework for the Treatment of Animal Genetics79

The Regulatory Framework for the Treatment of Animal Genetics of Cattle, Goats, Sheep, Horses and Swine in Mercosur [Marco regulatorio para el tratamiento de la genética animal de bovinos, caprinos, ovinos, equinos y porcinos en el Mercosur], approved by Resolution of the Mercosur Common Market Group (GMC), was motivated by the convenience of having a regulatory framework that guarantees free trade and movement of animals and materials for animal multiplication of registered breeds or cross-breeds without genealogical registration.

No discriminatory animal genetic restrictions of any kind shall be placed on free trade and movement of animals and materials for animal multiplication of registered breeds or cross-breeds without genealogical registration. Bodies or entities responsible for official registration in each country must report which assays are considered official and implement effective actions to harmonize them in a timely manner. Animals imported from third countries can only enjoy the benefits of free trade after the corresponding genetic assays have been carried out under Mercosur and recognized by official bodies or competent authorities.

Registration of animals raised in Mercosur member countries shall be performed in accordance with regulations applied to the breeders in the country where registration has been applied for, without further requirements beyond those required of local farmers. There shall be no discrimination between animals of domestic origin and those coming from other Mercosur countries in applying fees established by the entities responsible for registration as payment for services rendered.

Regulatory Framework for Veterinary Products80

The Regulatory Framework for Veterinary Products [Marco Regulatorio para Productos Veterinarios], approved by Resolution of the Mercosur Common Market Group (GMC), was established based on the need to harmonize the requirements for registration of veterinary products and establishments that manufacture and/or commercialize them in Mercosur member states. It also has the objective of promoting scientific advancement in animal health, developing the veterinary products industry in accordance with technological advances, and facilitating movement of veterinary products which meet standards of quality, efficacy and safety.

All veterinary products must be registered following the rules set forth in the regulation. A “veterinary product” is understood to be any chemical, biological, biotechnological or manufactured preparation, whose administration is done individually or collectively, directly or mixed with food, in order to prevent, diagnose or treat animal diseases.

Considering its importance for the diagnosis, prevention, treatment and eradication of animal diseases in food production, and considering their impact on health, the products must meet the highest standards of quality, raw materials, production processes and finished products, using internationally recognized organizations as a benchmark, such as the USDA Code of Federal Regulations, the US Pharmacopeia (USP), the Directives of the European Economic Community, the British Pharmacopoeia (BP), the European Pharmacopoeia (Ph.Eur.), and the standards of the WHO and the World Organization for Animal Health (OIE) [Office International des Épizooties].

Every establishment which manufactures, manipulates, distills, markets, imports or exports products directly to veterinarians and/or to third parties must be registered with the competent body in their respective country. Facilities and professional responsibility are regulated.

Applications for registration of veterinary products must be accompanied by a description of requirements, which shall the same for the four Mercosur member countries. Certificates of registration granted to veterinary products produced in the member states shall have a validity of 10 years. For marketing of any product which has harmonized standards originally approved in a member country, it will be necessary to obtain co-validation in any of the three remaining countries, from the relevant official body.

The application for registration of pharmaceutical products must include consolidated scientific information on the pharmacokinetic and pharmacodynamic aspects of the drug(s), as well as other information recorded on its metabolism and derived metabolites. When there is no scientifically recognized consolidated information, the competent authority shall establish the necessary assays and controls, in accordance with scientific-technological conditions recommended by recognized international organizations.

Biological products must undergo assays which meet the following requirements: controls for sterility, purity, safety, effectiveness and determination of potency and any other assays deemed necessary, supplemented by chemical, physical-chemical and biological tests which ensure compliance with the standards required by the regulations for all product types and characteristics.

The competent authority shall authorize the importation, use and/or manipulation of products for research and experimental tests, for known purposes and approved experimental designs, restricted to a single time, place and mode of use.

At a later date, supplementary regulations of the regulatory framework of veterinary products were approved, by Mercosur Common Market Group (GMC) Resolution No. 39/96, on the basis of Recommendation No. 16/96 from Work Subgroup No. 3 (SGT-3): “Technical Regulations.” These include a detailed set of specific technical rules and recommendations on requirements to be met in order to enable the various aspects presented by veterinary products.

Rules for Proper Manufacturing Practices and Quality Inspection of Medicines81

Rules for Proper Practices for Manufacturing and Quality Inspection of Medicines [Reglas sobre Practicas Adecuadas para la Fabricación y la Inspección de la Calidad de los Medicamentos] were approved by Resolution No. 04/92 of the Mercosur Common Market Group (GMC), based on Recommendation No. 5 from Work Subgroup No. 3 (SGT-3): “Technical Regulations.” Its approval considers that harmonized regulations on medicinal products must ensure adequate levels of quality in order to ensure the preservation of public health of member states and fair trade.

By means of this resolution, the GMC incorporated Resolution No. 2,865 of the World Health Organization into the regulations of Mercosur, and established that it must be assimilated by the specific legislation of each member state, as a minimum requirement for the manufacture and quality control of drugs and their active ingredients.

At a later date, Resolution No. 59/92 of the GMC approved the Guide for Inspections of Pharmaceutical Industry Establishments [Guía para Inspecciones de Establecimientos de la Industria Farmacéutica], an instrument to perform the duties of health surveillance, which is the responsibility of the authorities of Mercosur member states. Finally, Resolution No. 14/96 of the GMC established regulations on Verification of Compliance with Good Manufacturing and Control Practices in Pharmaceutical Industry Establishments [Verificación del cumplimiento de las buenas prácticas de fabricación y control en establecimientos de la industria farmacéutica], considering that the inspection of pharmaceutical establishments is one of the main instruments of regulation and control. This regulation is based on a regional harmonization effort conducted within the framework of the Health Products Commission of Mercosur’s Work Subgroup No. 3 (SGT-3): “Technical Regulations.”

The document will be updated at such time as the member states agree to adopt new regulations on Good Manufacturing and Control Practices recommended by the WHO, resulting from scientific and technological development in the sector.

Chapter 4
Common regulations on biosafety and intellectual property

Mercosur terminology standards for seeds82

These standards aim to facilitate seed trade among Mercosur member states. They apply to the entire scope of Mercosur, for the stages of procurement, production, certification and marketing of seeds. The policy and regulatory entities from the agricultural area of the four countries are responsible for their implementation. The following international and domestic regulations of countries in the Mercosur bloc serve as technical references:

Convention on Biological Diversity.

Southern Cone Regional Phytosanitary Committee (COSAVE) [Comité de Sanidad Vegetal del Cono Sur] (meeting minutes).

International Seed Testing Association (ISTA).

International Union for the Protection of New Varieties of Plants (UPOV), 1978 and 1991 Acts.

Argentina’s Law on Seeds and Plant Genetic Creations No. 20,247/1973.

Argentina’s Regulatory Decree No. 2,183/91.

Brazil’s Plant Variety Protection Law No. 9,456/97 and Decree No. 2,366/97.

Brazil’s Seed Law No. 10,711 dated August 5, 2003 and Decree-Law No. 81,771/78.

Paraguay’s Law No. 385/94 on Seeds and Plant Variety Protection.

Uruguay’s Seed Law No. 16,811.

Definitions of the most well-known terms are provided below:

Biotechnology: Any technological application that uses biological systems and living organisms or derivatives thereof to create or modify products or processes for specific uses.

Clone: A group of individuals derived from another one, arising out of any of the agamic or asexual multiplication procedures without chromosome reduction.

Plant breed: Any plant variety or cultivar, whatever its genetic nature, obtained by creation, discovery and application of scientific knowledge of plant breeding.

Cultivar/Variety: A set of cultivated plants which are clearly distinguished by some morphological, physiological or cytological traits from others, and which retain their distinctive traits when they reproduce sexually or asexually.

Differentiability and distinctiveness: A condition in which a cultivar/variety can be distinguished clearly by means of one or more traits from any other, making it possible it possible to be described and accurately recognized.

Breeder’s/creator’s rights: An right granted to the breeder/creator on their copyrighted material limiting/constraining use thereof by other parties with prior authorization.

Stability: The condition of a cultivar/variety where its most relevant essential heritable traits remain stable, in accordance with their definition, after successive propagations or multiplications.

Homogeneity: The condition of a cultivar/variety where it is sufficiently uniform in its essential traits, taking into account expected variations, in accordance with the form of multiplication or propagation.

Genetic identity: A set of genotypic and phenotypic traits of a cultivar/variety which differentiate it from others.

Novelty: The requirement that a cultivar/variety not have been offered for sale or commercialized by the breeder, or by another party with the breeder’s consent.

Breeder or creator: The person who has created/discovered and developed a cultivar/variety.

Intellectual property: This covers all the exclusive rights concerning an intellectual creation, whether in the domain of technology (patents, utility models, plant breeder’s rights, etc.), distinctive marks and signs (trademarks, appellations of origin), or artistic and cultural expressions (literary or musical works, etc.).

Seed: Any plant structure or organ used in the propagation or multiplication of a species or intended for planting crops, such as: seeds in the normal botanical sense, as well as fruits, bulbs, tubers, buds, cuttings, cut flowers and others.

Transgenesis: The introduction of foreign genes into an organism.

Transgenic / genetically modified: Any organism obtained by recombinant DNA and/or various processing techniques applying genetic engineering.

Chapter 5
Internalization of regulations

The coexistence of four national legal systems is complex, since it is premised on maintaining the autonomy of each country. Each system thus adopts, within its own jurisdiction, particular ways to create and extinguish laws, which are not interchangeable. In recognition of this diversity, the regime adopted in the Ouro Preto Protocol decided to establish a system of uniform procedures to provide predictability and harmony on issues relating to the validity of regulations in the four Mercosur countries.

The system adopted to incorporate common regulations into national laws and to determine the term of their validity in the four countries, agreed to in Ouro Preto Protocol, reaffirms the legal and political decision of states to maintain their autonomy. The decision reflects the constitutional “asymmetry” which exists in Mercosur.

The constitutional constraints in Brazil and Uruguay on automatic inclusion of collective regulations create a situation where the reciprocity and equality required by Argentina’s Constitution do not exist. In Brazil, treaties, once incorporated into national legal system, are then considered to be laws, including the principles governing their repeal. This fact shows the impossibility of imposing supranational features on Mercosur regulations.

The system implemented based on the Ouro Preto Protocol has shown deficiencies that are reflected in increasing delays regarding internalizing the mandatory regulations derived from the Treaty. Within Mercosur, there are numerous difficulties in making integration rules come into effect simultaneously, as a result of the delays found in the various national legal systems. In view of this situation, complaints were discussed before the Common Market Group (GMC), regarding failure to incorporate various regulations. As consensus was not obtained for formulating a resolution of these claims, the Group concluded its activities without reaching any solution.

The GMC dictated two resolutions aimed at the problem. Resolution No. 22/98, made a request “to give priority to draft laws moving through the parliamentary process which involve regulations approved by Mercosur to date and which require incorporation by legislative means.”

Resolution No. 23/98, established, in non-binding fashion, that all draft regulations “which are pending approval by agencies with decision-making powers which require incorporation by administrative means must specify the period in which the regulation is to be incorporated into the legal systems of the member states, counted from the date on which said regulation has been approved.” The resolutions do address certain concerns; however, they do not progress towards solving the problem, which consists of political hesitation to comply with the legal commitments entered into.

Decision No. 23/00 of the Common Market Council (CMC), adopted in March 2000, on the relaunching of Mercosur, highlights the need for Mercosur to have an efficient and updated segment on the process of incorporating its regulations into the legal systems of member states. For this purpose, it provides that states shall notify the Administrative Secretariat of Mercosur (SAM) [Secretaría Administrativa del Mercosur] on the incorporation of Mercosur regulations into their national legal systems. After a regulation has been incorporated by all states, SAM shall notify the others of this fact.

SAM shall prepare a Incorporation Status Report on Protocols, Decisions, Resolutions and Directives [Cuadro de Incorporación de Protocolos, Decisiones, Resoluciones y Directivas], which shall be updated monthly and distributed to member states. The GMC shall include, as a priority issue on the agenda of its regular meetings, an analysis of the Incorporation Status Report. Delegations must report the status of processing the incorporation of provisions have which not yet been incorporated into their legal systems.

In the area of intellectual property rights, the Protocol on Harmonization of Intellectual Property in Mercosur on Matters of Trademarks and Indications of Provenance and Appellations of Origin is not yet in force. Only Brazil and Paraguay have promulgated the respective national laws incorporating this regulation into their domestic legal systems. In Argentina, the representatives have argued that the adoption of the Protocol requires modifications to the National Law of Trademarks, which is why it is still under study.

Part 6
Comparative analysis of regulations in Mercosur

Chapter 1
Regulation of intellectual property

Introduction

The Mercosur countries have taken significant steps to adapt their patent systems to the provisions of the TRIPS Agreement83. In September 1995, Argentina approved a new legal regime for invention patents84, while in 1996 Brazil passed a new Patent Law85. Uruguay did the same in 1999 and Paraguay adopted its law in November 200086. Patent protection has been significantly strengthened by extending the term of validity to 20 years, introducing pharmaceutical patents, reversing the burden of proof in litigation on process patents, and protecting against unfair use of secret information for the registration of pharmaceutical products.

Countries did not engage in identifying common approaches on this issue. This lack of coordination has led to different laws with different regulations for protection in each country. The members of Mercosur did not take the opportunity to coordinate their policies on patents and to resist external pressures, which are currently being expressed in the intention of the US pharmaceutical industry to question certain standards of protection of national legislation, and the US government, which is trying to lift regulations on protection in the region, in negotiations on the Free Trade Area of the Americas (FTAA).

Differences in regulatory protection (CORREA, 2001)

Using the leeway authorized by the TRIPS Agreement, the four national legal systems include new key aspects, which have no corresponding standard in all countries. Differences and similarities in significant aspects of protection are analyzed below:

Validity of the patent

Industrial property laws of Argentina, Brazil, Paraguay and Uruguay provide a period 20 years for validity of patents, counted from the date of application. Brazil has introduced the idea of awarding a minimum of 10 years counted from the date of granting the patent, if there is any delay in granting the patent due to lawsuits or force majeure.

Parallel imports

Argentina allows parallel imports when the product has been legally placed in commerce in a foreign market. Paraguay and Uruguay allow the performance of commercial acts related to the protected product, relying on its introduction into lawful trade in any country by the owner or by legally authorized persons. Brazil does not provide for the possibility of parallel imports when the product protected by a patent has been legally placed in commerce in the external market, although it exclusively authorizes importation of living matter on condition of not it being used for commercial propagation.

Compulsory licenses

Brazilian law grants licenses due to lack of exploitation, patent dependency, in cases of emergency or public interest, and due to abuse by the patent owner. Argentina uses similar conditions, but defines more precisely the conduct that is abusive, specifying types actions that can be considered anti-competitive practices, without prejudice to other behaviors defined in the law on protecting competition. Paraguay and Uruguay also incorporate this concept.

Brazil requires the patent owner to manufacture the product or use the process in the country, except in case of economic unfeasibility. Argentina does not have a similar regulation to provide for compulsory licenses due to lack of exploitation or insufficient exploitation. This criterion is not included in the legislation of Paraguay and Uruguay.

Reversing the burden of proof

All countries have introduced, in their legislation, an article that allows a judge to reverse the burden of proof in disputes regarding new products or processes, although not all countries have extended this to cover the same things: Brazil, Argentina and Paraguay have authorized this for products, while Uruguay has authorized this for processes.

Pharmaceutical patents

Pharmaceutical inventions are patentable in Argentina after the lapse of five years from publication of the law. The extension period of five years applied to pharmaceutical products has not been expanded to cover chemical, non-pharmaceutical or non-veterinary products, such as pesticides, fertilizers, dyes, etc. The situation of such products has not changed with regard to their protection and exploitation under the new law. Argentina has honored the commitments made with the ratification of the GATT-TRIPS Agreement regarding the protection of pharmaceutical products.

Uruguay has established a similar system, which lasted until November 2001. Brazil recognizes patenting of pharmaceutical products with retroactivity, allowing their protection if they are not traded on any market and where the applicant has obtained a patent in the country where the first application was filed. Argentina has adopted a transitional period of 5 years in accordance with TRIPS, and the same was done by Uruguay. Meanwhile, Paraguay has adopted a transition by January 1, 2003. This is an important issue that may be brought up again in a subsequent comparative analysis of the consequences of specific strategies on the development of biotechnology in the pharmaceutical industry in the Mercosur countries.

The Pharmaceutical Research and Manufacturers of America (PhRMA) requested the inclusion of Argentina among the countries that allegedly infringe upon intellectual property rights. In the same list and in the category of “Priority Foreign Country,” are Brazil, South Africa and India. The US entity accused the Argentine government of “allowing local copying of pharmaceutical innovations” and “making it easier for local companies to appropriate intellectual property rights” from the entity’s companies, and recommended application of trade sanctions as provided for in section 301 of the US Trade Act of 1974.

Criticisms by US industry of Argentine legislation on intellectual property included claims that it “does not present sufficient guarantees” and that the Argentine government refuses to sign an “agreement” within the framework of the World Trade Organization (WTO), an organization that attempted a mediation between the two countries. The United States positioned itself against Brazil in the WTO due to its local manufacturing clause and denounced Argentine law for its use of compulsory licenses.

Acts in good faith

The laws of Brazil, Paraguay and Uruguay agree that rights of the patent owner may be restricted, provided that the product or the process to which the patent is directed has been introduced into commerce in the country prior to the filing date of the patent being applied for, which would constitute an act performed in good faith. Argentina’s legislation also acknowledges the limitation of the right of the patent owner where consistent preparations have already been made for the introduction of the product into the market.

Development of the institutional system

The institutional system has been developed within Mercosur. All countries have institutional areas responsible for managing industrial property issues. In Argentina and Brazil, they were organized in the form of the National Institutes of Industrial Property (INPI). In Paraguay, regulation depends on the Directorate of Industrial Property (DGPI) [Dirección General de la Propiedad Intelectual] of the Ministry of Trade and Industry and in Uruguay, it depends on the National Directorate of Industrial Property (DNPI) [Dirección Nacional de la Propiedad Industrial], of the Ministry of Industry, Energy and Minerals.

As already discussed, Argentina and Brazil have adopted a structure involving national institutes, which enjoy an important institutional autonomy. This is the structure of choice in international experience. Paraguay and Uruguay have entrusted this responsibility under the direction of public bodies, belonging to national government ministries, which have less autonomy from the legal-functional point of view.

National development strategies

The industrial property laws of Brazil, Paraguay and Uruguay have exceptions to the rights of the patent owner, giving a third, unauthorized party, the power to perform acts or experiments conducted solely in order to obtain information in order to process a registration, or preparations for future commercial exploitation, before a patent’s expiration date. Uruguay authorizes this from one year prior to expiration, Paraguay authorizes this from 30 days prior, while Brazil does not provide any date. In Brazil, this modification was introduced by a recently enacted law87 which extends the scope of the country’s industrial property law in this area. In Argentina, legislation has made no provisions regarding this issue.

It is also worth noting that in Brazil, patent law includes a topic on applying for a patent and establishes a special procedure for products or processes related to national defense. The other Mercosur countries still have not introduced a corresponding consideration to their respective laws.

Patents in the field of biotechnology

Patenting of plants and animals

In the four Mercosur countries, patenting in biotechnology has been dealt with and incorporated into their laws governing intellectual property. In Argentina, the patent law was approved after a complex proceeding. Law No. 24,481 was revised one month after its approval, with the Executive branch vetoing several articles. Finally, in 1996 the consolidated text [Texto Ordenado (T.O.)] of Law No. 24,481 was published, amended by Law No. 24,572, which is in effect to this day. Some important issues were introduced later by Decree No. 260/96, which regulates the articles of that law (CORREA, 1996).

Article 6 (g) states that “all kinds of living matter and substances pre-existing in nature,” do not result in patent, because they are not inventions, a decision intended to exclude the patentability of substances existing in nature. Article 7 (b) established as unpatentable “the totality of the biological and genetic material existing in nature or its replica in biological processes implicit in animal plant and human reproduction, including processes related to genetic material capable of conducting its own replication in normal and free conditions, as occurs in nature.” Finally, Decree No. 260/96, regulating Article 6, incorporated the idea that “plants, animals and essentially biological procedures for their reproduction” are not patentable

According to some experts (CORREA, 1996), Article 7 (b) partially overlaps with Article 6 (g) by strengthening the concept of non-patentability of substances existing in nature and biological processes, but does not refer to “essentially biological” processes, leaving it open to be discussed whether they do or do not need to be included in the area of patenting. In summary, the situation in Argentina would be as follows (CORREA, 1996):

Plants and animals are patentable when genetically modified, that is, only transgenic animals and plants are patentable. Article 7 (b) prevents the patenting of non-genetically modified plants and animals.

Plant varieties are not patentable, as there is a system of protection of breeder’s rights. In addition, Argentina has ratified the Convention of UPOV 78, which prohibits the overlapping protection under different regimes.

Animal “breeds” are patentable.

The decision on the patentability of “essentially biological” processes is still under discussion.

Microorganisms are also patentable.

Decree No. 260/96, which regulates the Law, renewed the prohibition on patenting plants and animals. The Law and Decree contradict each other, as the Decree prohibits patenting and the Law permits it. Of course, the one that should prevail is the Law.

In the case of Brazil, Law No. 9,279/96 excludes from patenting, due to the fact they do not constitute an invention, all or part of natural living beings and biological materials found in nature or isolated from it, including the genome or germplasm of any natural living thing and natural biological processes. Under this law, whole or parts of living beings are not patentable, except transgenic microorganisms that meet the general requirements of patentability – novelty, inventive step and capability of industrial application – and which do not represent a mere discovery.

Paraguay does not consider as patentable plants and animals other than microorganisms and essentially biological procedures for the production of plants and animals, provided they are not non-biological or microbiological.

For Uruguay, plants and animals do not constitute an invention. But microorganisms and essentially biological procedures for the production of plants or animals are patentable, except for non-biological or microbiological procedures.

In summary, the situation in the Mercosur countries is as follows: essentially biological processes are not patentable in Brazil, Paraguay and Uruguay; however, they are patentable, by omission, under Argentine legislation. Plants and animals are not patentable in any of those countries, with the only possible exclusion being animals in Argentina.

Patents on microorganisms

The legislative systems of Argentina, Brazil, Paraguay and Uruguay have incorporated patenting microorganisms, although some doubts remain about Argentine legislation. In practice, this country does grant patents for microorganisms. The law in Brazil is the only one that includes a definition of genetically modified microorganisms, understanding them to be organisms, other than whole or part of plants or animals, which express, through direct human intervention in their genetic composition, a trait not normally attainable by the species under natural conditions.

All four countries have introduced, as a condition for granting this patent, the deposit of biological material in authorized banks. These banks must be accredited by the World Intellectual Property Organization (WIPO), so that they can participate in international agreements. The law of Argentina requires certain requirements to be fulfilled for this purpose88. Paraguayan law does not require the deposit of the microorganism strain, if this procedure has already been performed in a WTO country. Uruguay has established the requirement for authorization by its National Directorate of Industrial Property (DNPI) [Dirección Nacional de la Propiedad Industrial], under the Ministry of Industry, Energy and Minerals, until the country ratifies international agreements on the matter.

The laws of Argentina and Brazil incorporate the requirements of accessibility to the public of the microorganism from the date of publication of the patent application. Paraguay and Uruguay did not have regulations on the matter. Argentina adds the possibility that such persons may obtain a sample if they meet the conditions established by regulation. In practice, these considerations do not have immediate consequences, since there is no accredited database of microorganisms in the Mercosur countries.

Breeder’s rights

The only type of protection of intellectual property rights for plant varieties that is enforced by Mercosur countries is legislation regarding Plant Breeder’s Rights (PBR). All countries have such legislation, which allows protected varieties to be available to develop new varieties without prior consent from the breeder of the original variety (“breeder’s exception”), and allows farmers to re-use the propagating material of a variety protected by DOV for its continuous planting (“farmer’s privilege”). The four countries that make up Mercosur have joined, at various times, the International Union for the Protection of New Varieties of Plants (UPOV).

The oldest law of plant varieties protection is from Argentina89, approved in 1973. Paraguay adopted its law in 199190, while Uruguay adopted its law in 199791. The most modern law is that of Brazil92, adopted in 2000. On December 25, 1994, Argentina signed the UPOV Act of 197893, and it was signed by Brazil on May 23, 199994. Paraguay approved its accession to UPOV 78 with Law No. 988/96 dated November 14, 1996, and Uruguay acceded to UPOV 78 on November 13, 199495, and in 1997 it passed Law No. 16,811, which regulates Property Rights for Plant Varieties under UPOV 7896.

Unlike what happens in the field of industrial property rights, national laws on breeder’s rights in the Mercosur countries have converged to establish a strong foundation of uniformity, based on their relation to the same international organization, i.e., UPOV. National laws show only insignificant differences, such as the duration of protection, which in Brazil is 2 years less than in the other Mercosur countries, or in the treatment of farmers based outside the country. The biggest difference is seen in the Brazilian legislation, which has incorporated the concept of “essentially derived variety,” in conformance with UPOV 91.

Institutional organization in this area follows its own pattern, also distinct from that described for the regulation of industrial property. Argentina and Uruguay each created a National Seeds Institute (INASE) [Instituto Nacional de Semillas], which reports to the Ministry of Agriculture, Livestock, Fisheries and Food (SAGPyA) [Secretaría de Agricultura, Ganadería, Pesca y Alimentos] and the Ministry of Agriculture, Livestock and Fisheries (MGAP) [Ministerio de Ganadería, Agricultura y Pesca], respectively97. Meanwhile, Brazil established a National Plant Variety Protection Service (SNPC) [Serviço Nacional de Proteção de Cultivares] under the Ministry of Agriculture, Livestock and Food Supply (MAPA) [Ministério da Agricultura, Pecuária e Abastecimento]. In Paraguay, this function is handled by the Directorate of Seeds (DISE) [Dirección de Semillas] under the Ministry of Agriculture and Livestock (MAG) [Ministerio de Agricultura y Ganadería].

Chapter 2
Biosafety regulations

Principles, models and institutional organization

All Mercosur member countries have developed institutional structures responsible for dealing with biosafety of GMO products. The mechanism used is basically the creation of an Advisory Committee composed of experts, responsible for issuing assessments and producing non-binding opinions and findings, to support decision-making by state ministries and/or departments responsible for adopting administrative decisions.

These Advisory Committees have distinct functions, such as specific responsibility per productive area where GMOs occur, and institutional location and status. The major differences are, however, in the principles adopted by each country, the level of complexity of national systems and the degree of experience in regulation.

Fields of application and technical and institutional areas of coverage

In Brazil, technical responsibility for regulation of biosafety lies with the National Technical Commission on Biosafety (CTNBio) [Comissão Técnica Nacional de Biossegurança], under the Ministry of Science and Technology. CTNBio operates in the field prescribed by Law No. 11,105/2005 and has technical expertise on activities related to GMOs in all areas. It operates in conjunction with the Ministries of Environment, Health and Agriculture, which, through technical findings issued by CTNBio, process decisions through their own agencies, and in accordance with their respective duties.

Argentina has a more complex regulatory system, in which several advisory committees participate, linked to various bodies. The National Advisory Commission on Agricultural Biotechnology (CONABIA) [Comisión Nacional Asesora de Biotecnología Agropecuaria] is responsible for the field of genetically modified plants98, while the National Service for Agrifood Health and Quality (SENASA) [Servicio Nacional de Sanidad y Calidad Agroalimentaria] (SENASA, 1999)99 is oriented towards food, transgenic microorganisms and genetically modified animals. Both institutions present their recommendations to the Ministry of Agriculture, Livestock, Fisheries and Food (SAGPyA). The National Commission on Biotechnology and Health (CONBYSA) [Comisión Nacional de Biotecnología y Salud] (CONBYSA, 1994)100 is responsible for the area of human health, and submits its recommendations to the Ministry of Health.

In the Argentine system, analyzing the impact of GMOs on the environment is the responsibility of CONABIA, and its findings on the matter are adopted by SAGPyA. In the case of genetically modified plants, the Argentine system includes the National Directorate of Agrifood Markets (DNMA) [Dirección Nacional de Mercados Agroalimentarios] under SAGPyA, which is responsible for assessing the impact of GMO releases on the country’s international trade.

In Paraguay, the Advisory Committee for Biotechnology (CAB) is responsible for technical issues related to GMOs in agriculture, and its recommendations are submitted to the Ministries of Agriculture (MAG) and Public Health and Welfare (MSPBS). Finally, Uruguay’s Commission on Risk Assessment of Genetically Modified Plants (CERVGM) [Comisión de Evaluación de Riesgo de Vegetales Genéticamente Modificados] has technical responsibility for the impact of genetically modified plants on health and the environment, and its findings serve as input to the decisions of the Ministries of Livestock, Agriculture and Fisheries (MGAP), and Housing, Environment and Land Use Planning (MVMAOT).

Precautionary principle versus substantial equivalence

The Mercosur countries focus on the regulation of biosafety of GMOs using different principles. Argentina and Uruguay use a similar approach, essentially in the tradition of the American and Canadian systems, based on the principles of “risk assessment and management” for the consideration of environmental problems, and “substantial equivalence” for risk assessment of food.

Brazil and Paraguay use principles inspired by the European system, which focuses on the “precautionary principle,” incorporated into the Conference on Biological Diversity and, more recently, the Cartagena Protocol on Biosafety. Environmentally, this principle presupposes that potentially hazardous effects deriving from a phenomenon, product or process can be identified, but scientific assessment does not permit determining the risk with sufficient certainty. The regulatory system based on this principle also assumes that genetically modified foods are not equivalent to common foods, which is why they must meet different safety requirements.

Accumulated regulatory experiences

The most prominent regional experience in the field of regulation is that of Argentina. Its success can be seen in agriculture, following the explosive development of the cultivation of genetically modified crops, which made Argentina one of the countries with the largest area planted with genetically modified varieties and the second largest world exporter of GMOs. The performance of the Argentine regulatory system extends to other crops such as corn, cotton, rapeseed (canola) and some smaller varieties. CONABIA evaluates, supervises and controls more than 650 events, from laboratory trails to commercial releases, and recently approved and released six genetically modified crops for commercial exploitation.

In Brazil, regulatory activity has been severely hampered by political barriers to the development of GMOs in the country. The strong dynamic of research and development, particularly in the public sector, has not translated into a significant impact on innovation. Resistance from environmental groups and sectors of the political structure, coupled with decisions by federal and state courts, have prevented the commercial use of crops that had received favorable technical findings from CTNBio and favorable political and administrative decisions from the ministry responsible for the releases. Brazil has two crops released: herbicide-tolerant soybeans and insect-resistant cotton, but the aforementioned barriers are impeding their entry into the market and their extensive use in agriculture.

In Paraguay, the Agriculture Biosafety Commission (CBA) believes that preliminary studies carried out on varieties of genetically modified soy and corn have given results which discourage the introduction of these crops into the country. Because of this, the Subsecretariat of Natural Resources and Environment (SSERNMA) of the Ministry of Agriculture and Livestock (MAG) has established successive bans on the use of GMO seeds in the last two seasons in the country. In the case of Uruguay, the current Commission on Risk Assessment of Genetically Modified Plants (CERV) issued a favorable finding, and the Ministry of Livestock, Agriculture and Fisheries (MGAP) approved the introduction of a variety of genetically modified soya, which is grown in small areas in a demarcated region in the country.

In the context of a relatively small regulatory activity, the regulatory system of Uruguay, based on the scientific capacity of the National Institute of Agricultural Research (INIA) and other biotechnology research institutions in the country, has scientific prestige that supports its decisions. Its equivalent in Paraguay, in contrast, is based on a reduced internal scientific capacity, which is why there is concern that technical decisions are influenced by political motives101. In the latter country, there exists a semi-official discourse about a GMO-free country, which is contrary to the intentions of agricultural producers.

Mechanisms for public participation

The countries in the Mercosur bloc give different treatment to issues of public perception and acceptance of biotechnology. In Argentina and Brazil, there are no mechanisms for public participation in the authorization process for products or processes based on GMOs. In Uruguay, legislation provides that before adopting any resolution, the competent authority must make available in their offices the authorization application, the results of the evaluation of its risk assessment and other relevant documentation, so that the public can obtain knowledge and make assessments. In the case of Paraguay, the Agriculture Biosafety Commission (CBA) includes a representative from the Network of Environmental Organizations of Paraguay (ROAM) [Red de Organizaciones Ambientalistas del Paraguay].

Product labelling

Commercial labelling of products based on GMOs has not been widely disseminated among the Mercosur countries. Argentina and Paraguay have established systems, and Uruguay has a project that is under study by the National Parliament. In the case of Brazil, there is a law passed by Congress and Ordinance No. 2,658 dated December 22, 2003, which defines the symbol designating the labelling described in Decree No. 4,680.

Comparative tables of regulations on biosafety

Table 5. Features and institutional capacities of countries.

Regulation

Argentina

Brazil

Paraguay

Uruguay

Laws supporting development of biotechnology

No

Yes

No

Yes

National biotechnology committees

No

Yes

Yes

Yes

Regulation of production areas in which GMOs are used

Human health

MS

MS / CNS

MSPBS

MSP

Agriculture and livestock

SAGPyA

MAPA

MAG / MSPBS

MGAP

Foods

SAGPyA / MS

MS / Interinstitutional commission

MS

MSP

Environment

MBS

MMA / CONAMA / IBAMA

SRN and MAM

MVMAOT

Laws or ordinances establishing the general regulatory framework

Decree-Law No. 6,704/66

Law No. 20,247/73

Law No. 13,636/49

Food Code Decree No. 811/99

Law No. 11,105/2005

Law No. 18,481/97

Law No. 385/94

Law No. 16,466/94

Regulations specific to GMOs

Human health

No

Regulatory Rulings (INs) [Instruções Normativas]
No. 8, 9

No

Agriculture and livestock

SAGPyA Resolutions No. 656/92, 837/93, 289/97 and 131/98 226

INs No. 2, 3, 4, 5, 6, 10, 11, 12, 13, 18

Law No. 82/99

DGSA Resolutions No. 8/7/95, 8/12/95 and 13/1/96

Foods

SAGPyA Resolutions No. 289/97 Annexes and 511/98

Law No. 10,467/99

Decree No. 3,871/01

Law No. 836/80 on the Health Code

Environment

No

Laws No. 6,938/81

and 9,605/98

Provisional Measure No. 1,710-1/98

No

Entities with direct responsibility for regulations on biotechnology

Drugs and medicines

Entity

CONBYSA

CTNBio

No

Does not exist.

Functions

Advisory commission

Consultative body

-

-

Regulation creating the entity

ANMAT Resolution No. 413/93

Law No. 11,105/2005

-

-

Plants

Entity

CONABIA

CTNBio

CBA

CERV

Functions

Advisory commission

Consultative body

Advisory commission

Advisory commission

Regulation creating the entity

SAGPyA Resolution No. 124/91

Decree No. 18,481/97

Executive Decree No. 249/2000

Animals

Entity

CTAUOGM

CTNBio

No

Does not exist.

Functions

Advisory commission

Consultative body

-

-

Regulation creating the entity

SENASA Resolution No. 1,265/99

Law No. 11,105/2005

-

-

Simplified procedures

No

No

No

Under study

The Cartagena Protocol

Yes

Yes

-

No

Enforcement agency

Under discussion

No

Yes

No

Focal point

SAGPyA (for Clearinghouse)

No

(no data)

No

Table 6. Release of GMOs in the agricultural sector.

Regulatory attributes

Argentina

Brazil

Paraguay

Uruguay

Agency responsible for regulating release of GMOs in agriculture

SAGPyA

CTNBio (consultative); MAPA or MMA or MS (executive)

CBA

MGAP

Agency responsible for overseeing release of GMOs

Risk assessment

CONABIA

CNTBio (along with MAPA, MMA and MS)

Yes

CERVGM

Crop inspections

SENASA / INASE

CNTBio and MAPA

No crops authorized

Yes

Registration of cultivars

INASE

SNPC

DISE

INASE

Commercial release

SAGPyA

CNTBio, may also be assessed by CNBS

No

MGAP and MEF

Interinstitutional coordination

Link between biosafety and registration of cultivars

Yes

Yes

Yes

Partial

Types of authorization for environmental release

Greenhouse laboratory trial

Yes

Yes

Yes

Yes

Field trial

Yes

No

No

Yes

Pre-commercial multiplication

Yes

No

No

Yes

Commercial multiplication

Yes

No

No

Yes

Number of GMO crops released for marketing

6

2

0

2

Considerations for authorizing environmental release of GMOs

Characteristics of the material / organism subject control / donor-recipient-vector system

Yes

Yes

Yes

Purpose of the experiment and schedule of operations

Yes

Yes

-

Yes

Biosafety methods and procedures to be employed

Yes

Yes

Yes

Final disposal of the GMO

Yes

Yes

Yes

Proposed method of transfer

Yes

Yes

Yes

Commercial approval of GMOs

Yes

No

No

Yes

Non-regulatory mechanisms of marketing of GMOs

Perception and public acceptance

No

Yes

Resolution No. 554/99

Public hearing

Labelling

Under study

Yes

Under study

Draft law before Parliament

Evaluation of the impact on international trade

Yes

Yes

Yes

Yes

Difference between GMOs and traditional genetics

Registration and certification

No

Yes

No

Crop trials

No

Yes

No

Abbreviations used in Tables 5 and 6

Argentina

ME: Ministry of Economy [Ministerio de Economía]

MP: Ministry of Production [Ministerio de la Producción]

MS: Ministry of Health [Ministerio de Salud]

MDSyMA: Ministry of Social Development and the Environment [Ministerio de Desarrollo Social y Medio Ambiente]

SI: Department of Industry [Secretaría de Industria], under ME

SAGPyA: Ministry of Agriculture, Livestock, Fisheries and Food [Secretaría de Agricultura, Ganadería, Pesca y Alimentación], under ME

SEDSyPA: Ministry of Sustainable Development and Environmental Policy [Secretaria de Desarrollo Sustentable y Política Ambiental], under MDSyMA

SPyRS: Ministry of Health Policy and Regulatory [Secretaría de Política y Regulación Sanitaria], under MS

ANMAT: National Administration of Food, Drug and Medical Technology [Administración Nacional de Medicamentos, Alimentos y Tecnología Médica], under MS

INAL: National Institute of Food [Instituto Nacional de Alimentos], under ANMAT

INAME: National Institute of Drugs [Instituto Nacional de Medicamentos], under ANMAT

SENASA: National Service of Agrifood Health and Quality [Servicio Nacional de Sanidad y Calidad Agroalimentaria], under SAGPyA

INASE: National Seeds Institute [Instituto Nacional de Semillas], under SAGPyA

CTAUOGM: Technical Advisory Committee on the Use of GMOs [Comité Técnico Asesor para el Uso de OGM], under SENASA

CONABIA: National Commission on Agricultural Biotechnology [Comisión Nacional Asesora de Biotecnología Agropecuaria], under SAGPyA

CONBYSA: National Commission on Biotechnology and Health [Comisión Nacional de Biotecnología y Salud], under ANMAT

DNMA: National Directorate of Agrifood Markets [Dirección Nacional de Mercados Agroalimentarios], under SAGPyA

Brazil

ANVISA: National Health Surveillance Agency [Agência Nacional de Vigilância Sanitária]

CNBS: National Biosafety Council [Conselho Nacional de Biossegurança]

CNS: National Health Council [Conselho Nacional de Saúde]

CONAMA: National Council for the Environment [Conselho Nacional do Meio Ambiente]

CTNBio: National Technical Commission on Biosafety [Comissão Técnica Nacional de Biossegurança]

IBAMA: Brazilian Institute of Environment and Natural Resources [Instituto Brasileiro do Meio Ambiente e dos Recursos Naturais Renováveis]

MAPA: Ministry of Agriculture, Livestock and Supply [Ministério da Agricultura, Pecuária e Abastecimento]

MMA: Ministry of the Environment, Water Resources and the Legal Amazon [Ministério do Meio Ambiente, dos Recursos Hídricos e da Amazônia Legal]

MS: Ministry of Health [Ministério da Saúde]

SISNAMA: National System of the Environment [Sistema Nacional do Meio Ambiente]

SNPC: National Plant Varieties Protection Service [Serviço Nacional de Proteção de Cultivares], under MAPA

Paraguay

CBA: Biosafety Commission [Comisión de Bioseguridad Agropecuaria], under MAG and MSPBS

MAG: Ministry of Agriculture and Livestock [Ministerio de Agricultura y Ganadería]

MSPBS: Ministry of Public Health and Welfare [Ministerio de Salud Pública y Bienestar Social]

SSERNMA: Subsecretariat of Natural Resources and Environment [Subsecretaría de Estado de Recursos Naturales y Medio Ambiente], under MAG

Uruguay

MGAP: Ministry of Livestock, Agriculture and Fisheries [Ministerio de Ganadería, Agricultura y Pesca]

MVMAOT: Ministry of Housing, Spatial Planning and Environment [Ministerio de Vivienda, Medio Ambiente y Ordenamiento Territorial]

MEC: Department of Education and Culture [Ministerio de Educación y Cultura]

CNB: National Committee for Biotechnology [Comité Nacional de Biotecnología]

INASE: National Seeds Institute [Instituto Nacional de Semillas], under MGAP

INIA: National Institute of Agricultural Research [Instituto Nacional de Investigación Agropecuaria]

DGSA: General Directorate of Agricultural Services [Dirección General de Servicios Agrícolas], under MGAP

CERVGM: Commission on Risk Assessment of Genetically Modified Plants [Comisión de Evaluación de Riesgo de Vegetales Genéticamente Modificados], under MGAP

Comparative tables of regulations on intellectual property

Table 7. Intellectual property protection.

Regulation

Argentina

Brazil

Paraguay

Uruguay

Industrial property

Invention patents

Law No. 24,481, modified by Law No. 24,572 (T.O. 1996)

Decree No. 260/96

Law No. 9,279/96, Decree 2,553/98 and Law No. 10,196/2001

Law No. 1,630

Law No. 17,164

Utility Models

Law No. 24,481, modified by Law No. 24,572 (T.O. 1996)

Decree No. 260/96

Law No. 9,279/96

Law No. 1,630

Law No. 17,164

Industrial model and designs

Decree-Law No. 6,673/63

Law No. 9,279/96

Law No. 17,164

Trademarks

Law No. 22,362

Law No. 9,279/96

Law No. 1,294/98

Law No. 17,011

Technology transfer

Law No. 22,426

Law No. 9,279/96

Law No. 17,164

Enforcement agency

INPI

INPI

DGPI

DNPI

Breeder’s Rights

Seeds law

Law No. 20,247 and Decree No. 2,183/91

Law No. 9,456/97

Law No. 385

Law No. 16,811

Accession to UPOV

Law No. 24,376

Legislative Decree No. 28/99

Law No. 988/96

Law No. 16,580

Enforcement agency

INASE

SNPC

DISE

INASE

Confidentiality

Law 24,776

Law No. 17,164

Table 8. Invention patents.

 Rights holder

Argentina inventor

Brazil inventor

Paraguay inventor

Uruguay inventor

Inventions developed during the employment relationship

Total or partial right of the employer.

Additional remuneration or compensation (50% of benefits)

Total right of the employer, unless agreed in contract

Total right of the employer

Total or partial right of the employer

Additional remuneration or compensation (50% of benefits)

Validity of advance waiver of rights worker

Null and void

Not applicable

Not applicable

Any provision less favorable to the inventor is null and void

Conditions for protection

Novelty

Absolute novelty

Absolute novelty

Absolute novelty

Absolute novelty

Disclosure

Does not affect the novelty that year

Does not affect the novelty that year

Does not affect the novelty that year

Does not affect the novelty that year

Duration of invention patent

Twenty years

Twenty years

Twenty years

Twenty years

Regulatory body

INPI

INPI

DGPI

DNPI

Transitional arrangements

Pharmaceutical and chemical-agricultural industry (until March 31, 2001)

No

No

Pharmaceutical
and chemical-agricultural industry (until November 30, 2001)

Patents of addition

Yes

Yes

No

No

Patents of interest to national defense

No

Yes

No

No

Patents for foreign individuals or legal entities

Persons with established legal domicile in the country

Persons protected by international agreements or domiciled in the country

Accepted without requirements

Accepted without requirements

Unpatentable materials

Because they are not inventions

All types of living matter and substances existing in nature. Plants, animals and essentially biological procedures for reproduction

All or part of natural living beings and biological materials found in nature or isolated from it, including the genome or germplasm of any natural living being and natural biological processes

Plants and animals, other than microorganisms and essentially biological procedures for the production of plants or animals, except for non-biological or microbiological procedures. Biological and genetic material as it exists in nature

Not patentable

The totality of biological and genetic material existing in nature or its replica, in biological processes implicit in animal, plant and human breeding, including processes related to genetic material capable of conducting its own replication in normal and free conditions as occurring in nature

All or part of living beings, except transgenic microorganisms meeting the three patentability requirements – novelty, inventive step and capability of industrial application – provided for in Art. 8 and which are not a mere discovery

Plants and animals other than microorganisms and essentially biological procedures for the production of plants and animals that are not non-biological or microbiological processes

Rights conferred

Exclusive right to exploit

Yes

Yes

Yes

Yes

Sanctions against fraud

Criminal and civil

Criminal and civil

Criminal and civil

Criminal and civil

Reversing the burden of proof

For process patents

For process patents

For process patents

For process patents

Limitations on rights conferred

Exception for activities of R&D, testing or teaching

Yes

Yes

Yes

Yes

Experimentation, including preparation of a future commercial exploitation

No

Yes

30 days before expiration

During the year prior to expiration

Inventions in state-authorized monopolies

No

No

No

Exploitation authorized by the owner of the monopoly, or by its suspension

Introductions into trade prior to filing and based on acts of good faith

No

Yes

Yes

Yes

Products lawfully placed into trade

Yes

Yes102

Yes

Yes

Exceptions

Monopolistic or anti-competitive conduct

Yes

Yes

Yes

Yes

License due to dependent patents

Yes

Yes

Yes

Yes

Lack of exploitation

After three years from the granting of the patent, or after four years from filing the application

After three years from the granting of the patent

After three years from the granting of the patent, or after four years from filing the application

After three years from the granting of the patent, or after four years from filing the application

Lack of sufficient exploitation or production in the country

No

Yes

No

No

Reasons of public interest

Yes

Yes

Yes

Yes

Table 9. Patenting of microorganisms.

Patenting

Argentina

Brazil

Paraguay

Uruguay

Patentability of microorganisms

Yes

Yes

Yes

Yes

Obligation to deposit the strain

Yes

Yes

Yes

Yes

Requirements of depositary institutions

Accepted by WIPO or meeting determined requirements103

Accepted by INPI or specified in an international agreement

It is not necessary to perform deposit if it has already been done in a WTO country

Authorized by DNPI, pending ratification of international agreements on this matter

Accessibility of microorganism

Access from the time of publication

The public can obtain samples

Access from the time of publication

No

No

Existence of accredited depositaries in the country

No

No

No

No

Table 10. Plant variety property.

Property

Argentina

Brazil

Paraguay

Uruguay

Material eligible for protection

Plant breeding creations or plant varieties

Yes

Yes

Yes

Yes

Essentially derived plant varieties

No

Yes

No

No

Definition of plant breeding creations

The plant variety obtained by discovery or application of scientific knowledge to hereditary breeding of plants

A variety of any genus or species of higher plant species that is clearly distinguishable from other plant varieties, known by a minimum margin of descriptors, by its own denomination, which is homogeneous and stable and is a species capable of use by the agroforestry complex, as described in specialized publications, available and accessible to public, or equal to component lineages of the hybrids

A cultivar or variety, whatever its genetic nature, obtained by discovering or incorporating or transferring and/or applying scientific knowledge of hereditary plant breeding

A set of cultivated plants which is distinguished from rest of its species by any trait and which maintains its own traits under sexual or asexual reproduction104

Rights holder

Property right on the obtained plant

Breeder

Breeder

Breeder

Creator

Scope of property right

Cannot be used without the express authorization of the creator

Exclusivity in exploitation

Exclusivity in exploitation

Exclusivity in exploitation

Conditions for plant variety protection

Differentiation

Yes

Yes

Yes

Yes

Uniformity or homogeneity

Yes

Yes

Yes

Yes

Stability

Yes

Yes

Yes

Yes

Novelty of the cultivar

Yes

Yes

Yes

Yes

Mechanisms of reproduction or propagation of the cultivar

No

Yes

Yes

Yes

Declaration of limited public use

For a period greater than 2 years

Yes

Scope of protection

Protection of varieties of plant species

Yes

Yes

Yes

Yes

Protection of new varieties “discovered” for spots affecting fruit tree varieties

Yes

No

No

No

Protection of species found in nature

No

No

No

No

Accession to UPOV

UPOV 1978 Act

Yes

Yes

Yes

Yes

Other UPOV Acts

No

Yes

No

No

Essentially derived variety

No

Yes

No

No

Farmer’s privilege

Yes

Yes105

Yes

Yes

Term of the title to property

Between 10 and 20 years, depending on the species

Between 15 and 18 years, depending on the species

Between 15 and 20 years, depending on the species

Between 15 and 20 years, depending on the species

Regulators

INASE

SNPC

DISE

INASE

Can be used to create a new plant variety

Yes

Yes

Registration of cultivars for farmers domiciled abroad

If there is reciprocity with the foreign country and the person has legal domicile in Argentina

Yes

Yes, if the representative has legal domicile in the country

If a representative has established a domicile in the country

Abbreviations used in Tables 7, 8, 9 and 10

Argentina:

INASE: National Seeds Institute [Instituto Nacional de Semillas], under SAGPyA

INPI: National Industrial Property Institute [Instituto Nacional de la Propiedad Industrial], under ME

ME: Ministry of Economy [Ministerio de Economía]

SAGPyA: Ministry of Agriculture, Livestock, Fisheries and Food [Secretaría de Agricultura, Ganadería, Pesca y Alimentación], under ME

Brazil:

INPI: National Institute of Industrial Property [Instituto Nacional da Propriedade Industrial], under MCT

Ministry of Agriculture, Livestock and Food Supply (MAPA) [Ministério da Agricultura, Pecuária e Abastecimento]

SNPC: National Plant Varieties Protection Service [Serviço Nacional de Proteção de Cultivares], under MAPA

Paraguay:

DISE: Directorate of Seeds [Dirección de Semillas], under MAG

DGPI: Directorate of Industrial Property [Dirección General de la Propiedad Intelectual], under MIC

MAG: Ministry of Agriculture and Livestock [Ministerio de Agricultura y Ganadería]

MIC: Ministry of Industry and Trade [Ministerio de Industria y Comercio]

Uruguay:

DNPI: National Directorate of Industrial Property [Dirección Nacional de la Propiedad Industrial], under MIEM

INASE: National Seeds Institute [Instituto Nacional de Semillas], under MGAP

MGAP: Ministry of Livestock, Agriculture and Fisheries [Ministerio de Ganadería, Agricultura y Pesca]

MIEM: Ministry of Industry, Energy and Mining [Ministerio de Industria, Energía y Minería]

International:

OECD: Organisation for Economic Cooperation and Development

WIPO: World Intellectual Property Organization

UPOV: International Union for the Protection of New Varieties of Plants

Part 7
Conclusions and recommendations

Chapter 1
Prospects for harmonization of biosafety regulations

The picture of the situation in biosafety in the Mercosur countries as described indicates the need to proceed with harmonizing the internal regulations of those countries. It is important to work on a scientific basis where plant science criteria will prevail over ideological approaches. The process should be based on a permanent dynamic, able to adapt to changes resulting from the rapid advancement of scientific and technological knowledge in the field of biotechnology.

The process should win over public opinion in relation to the products and processes of modern technology. It is also necessary to have mechanisms for social participation, education policies and strategies to implement innovations in biotechnology, in the context of preservation of biosafety and protection of human health and the environment.

The harmonization of biotechnology regulations in Mercosur should be based on knowledge which reinforces the scientific basis of the regulatory process and encourages it to be continuously updated. The agenda of issues should include significant joint projects for biosafety, addressing the following topics: the escape of pollen, the introduction of genes in an extreme environment and the catalog of beneficial insects.

Article 14 of the Cartagena Protocol on Biosafety of Biotechnology suggests the development of bilateral, regional and multilateral agreements and arrangements relating to the intentional transboundary movement of living modified organisms, provided that such agreements and arrangements are consistent with the objective of the Protocol and do not reduce the level of protection established by it. The Protocol will not affect intentional transboundary movement which occurs in the presence of an agreement between the parties.

Chapter 2
Harmonization of intellectual property regulations

International and regional contexts of negotiations

Within the process of integration of the Mercosur countries, instruments have been negotiated which establish minimum standards relating to trademarks and geographical indications, industrial designs, and rights of creators and related parties, but there have been no improvements on other issues, such as patents. The new patent laws adopted by the four countries are based on standards established by the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS). However, there are significant differences between them, for example, with regard to patents in biotechnology and the obligation to locally exploit inventions.

The TRIPS Agreement signed in 1994 imposed international standards of intellectual property protection on member countries of the World Trade Organization (WTO), especially in regard to patents. The TRIPS Agreement established a “transition period” for developing countries to conform their laws to the new standards. Mercosur member countries, however, established their new patent laws using processes developed within each country, without regard to any regional coordination. Because of this, it was not possible for Mercosur’s system of intellectual property protection to match the standards set by TRIPS.

In many academic fields and in international organizations and forums, such as the United Nations Development Programme (UNDP) and the World Health Organization (WHO), concerns have been raised about the impact of TRIPS on health conditions in developing countries. These concerns have also been raised at the WTO, whose Fourth Ministerial Conference held in Doha, Qatar on November 9-24 2001, endorsed an interpretation of TRIPS which allows countries to produce generic drugs. The issue of legalizing free importation of generic drugs from countries that have no economic or technological conditions for producing them, as a valid practice within the framework of the WTO, remained pending.

At the Summit of the Americas held in December 1994, the American countries decided to negotiate the establishment of the Free Trade Area of the Americas (FTAA). Among the topics of negotiation was intellectual property, for which a special working group was created.

During the FTAA’s 6th Business Forum of the Americas, held in Buenos Aires, various business entities from the Mercosur countries, such as the Brazilian Association of Industries of Fine Chemistry, Biotechnology and their Specialties (ABIFINA) [Associação Brasileira das Indústrias de Química Fina, Biotecnologia e suas Especialidades], the Argentine Industrial Union (UIA) [Unión Industrial Argentina], the Brazilian National Confederation of Industry (CNI) [Confederação Nacional da Indústria do Brasil] and the Chamber of Industry of Uruguay (CIU) [Cámara de Industrias del Uruguay], presented proposals on the subject. A joint proposal on behalf of the Mercosur Industrial Council was also presented, composed of the UIA, the CNI, the CIU and the Industrial Union of Paraguay (UIP) [Unión Industrial Paraguaya]. These positions could help to identify the basis for a convergence of procedures at the regional level, using the opportunity that the FTAA offers for harmonization of intellectual property regulations in Mercosur.

Main areas of disagreement in the FTAA negotiation process106

In the process of negotiation of the FTAA, the main areas of disagreement between the countries involve the scope of the eventual agreement to be signed within the framework of the FTAA, in relation to TRIPS, and basic questions about the development of biotechnology, in particular about patenting of plants and animals. The main points of debate involve the following issues:

Scope of the agreement on intellectual property rights

Treating the FTAA intellectual property using the standards provided for in TRIPS, without attempting to increase or introduce of new protected areas.

Introducing other patterns of intellectual property protection, in addition to those under TRIPS.

Patentability

Eliminating the exclusion of patents on plants and animals.

Maximally restricting the scope of patenting in biotechnology.

Principle of exhaustion of rights

Applying the principle of winning national rights to prevent parallel imports.

Applying the principle of winning international rights to intellectual property.

Compulsory licenses

Implementing the non-restrictive nature of compulsory licenses.

Adopting the restrictive nature of compulsory licenses.

Second uses

Specifically excluding protection of second use of the products already patented.

Allowing patentability for second use.

Duration of patent

Establishing an additional protection that extends the duration of the term of the rights granted by a patent, when delays in obtaining marketing authorizations, on the part of administrative entities handling health issues, do not allow the owner the full exercise of these rights.

Not accepting the extension of duration of the term of a patent.

Exceptions for experimentation

Excluding experimentation for commercial purposes, but allowing analysis and use of information and of the patented product in order to obtain approval for health products before the patent expires, and allowing them to be commercialized after they are produced.

Restricting the experimental uses of a patented invention in order to avoid, for the duration of the patent, its commercially relevant use.

Undisclosed information

Protecting undisclosed information and simultaneously rejecting any coordination which would give that information an exclusive nature, and allowing marketing of similar products already in the public domain.

Protecting undisclosed information while the trade secret lasts. This information would not be allowed to be used for the purpose of obtaining a second authorization permit by a person other than the owner, for at least 5 years.

Relations between government agencies

Maintaining the independence of functions between patent offices and drug approval agencies.

Establishing the link between patent offices and offices involved in approving registration for marketing a pharmaceutical product.

Other divergent positions

Resolving disputes.

Protecting plant varieties.

Explicitly anticipating the requirement of local production for the granting of patents.

Requiring local manufacturing of the patent.

Providing mechanisms that facilitate the granting of patents and trademark registrations in various countries.

Passing legislation on unfair competition.

Handling trade secrets.

Involving government agencies and non-governmental organizations in cases of suspicion of piracy.

Positions of Mercosur business organizations

ABIFINA107

The proposal from the Brazilian Association of Industries of Fine Chemistry, Biotechnology and their Specialties (ABIFINA) recalls that Article 4 of TRIPS prohibits the favoring of any nation, which greatly reduces the chances of negotiating such matters within the FTAA. It also emphasizes that any preferential treatment accorded to countries in the Americas will be extended automatically to other WTO countries, possibly without consideration of reciprocity on the part of WTO countries not in the Americas.

The proposal emphasizes that the rules relating to intellectual property cannot be transformed into a market control mechanism. Rather, they should serve as an instrument of the technological and social development process, as recognized in Articles 7 and 8 of TRIPS. These rules have not yet been introduced as mandates in the FTAA negotiating process, which implies serious harm to developing countries and the industrial and commercial activities of such countries. The FTAA negotiations should be conducted based on the following principles:

In terms of intellectual property, no provision will be negotiated which can constitute or establish an advantage, favor, privilege or immunity, including procedures for acquisition or maintenance of rights, for the originating countries of the FTAA, allowing its extension, without reciprocity, to a country which is not a member of the FTAA.

During the process of creating the FTAA and for the interpretation of any agreements which are signed, all countries have recognized that the objectives of national intellectual property include providing technological and social development; that protection and enforcement of intellectual property rights should encourage technological innovation and technology transfer and dissemination, striking a balance between rights and obligations in order to promote social and economic welfare.

Countries may adopt the measures necessary in order to: protect public health and nutrition, promote the public interest or social sectors of vital importance to their socioeconomic and technological development; and prevent or eliminate rights abuses or practices on the part of owners of intellectual property rights which unreasonably restrict trade, including not fully satisfying the internal market of the country, or hindering the transfer of technology.

Argentine Industrial Union108

The Argentine Industrial Union (UIA) proposes to focus negotiations on establishing a common understanding regarding the enforcement and interpretation of certain provisions of existing multilateral agreements on intellectual property and on the promotion of technology transfer. The implementation of the TRIPS Agreement represents a program of major scope and depth, not only because it requires modifications in existing laws, but also because it introduces entirely new laws, such as those dealing with integrated circuits and plant varieties. The recommendations are to ratify the following propositions:

That the TRIPS Agreement should provide an appropriate standard, with the consensus of the entire international community, regardless of the degree of development of the signatory countries, ensuring the promotion of technological innovation and adequate transfer and dissemination of technology for the benefit of producers and users.

That it should take into account the differences in technological capability and productivity of the Southern countries, and restrictions on their ability to innovate.

That it the less developed countries should emphasize. in developing their intellectual property systems, the aspects of technology transfer, the regulation of abusive practices and the protection of minor innovations.

That the harmonization provided for in TRIPS should establish a reasonable limit in terms of alignment of intellectual property in the Americas.

The UIA, meanwhile, suggests that the negotiations on intellectual property should focus on finding a common agreement that meets the goals set out in TRIPS to reduce trade distortions in the Southern Hemisphere, and ensure adequate and effective protection of rights. These actions include the following:

Approving, as soon as possible, national laws consistent with TRIPS, while respecting the right to use transition periods.

Adopting mechanisms for rapidly incorporating international treaties into national legal and regulatory systems.

Adopting and implementing formal measures to ensure effective enforcement of laws by government authorities.

Being aware of differences in technological capability and productivity among the countries in the region.

Encouraging countries in the Southern Hemisphere to use the multilateral dispute settlement system to resolve conflicts of intellectual property protection.

Mercosur Industrial Council109

This organization has adopted a common position, which consists of:

Negotiations on Intellectual Property in the FTAA should focus on effective implementation of the provisions in the various international agreements in force, in particular the TRIPS Agreement, aimed at reducing trade barriers and eliminating distortions affecting trade relations between member countries. The chapter on Intellectual Property in the FTAA should not introduce additional protection or levels above the minimum standards set forth in TRIPS, nor should protection levels incompatible with the standards established in the agreement be interpreted as constituting a reduction in protection.

Considering the importance of intellectual property as a tool for technological development, mechanisms should be created to promote the effective transfer of technology to developing countries – one of the objectives of TRIPS – through the elimination of restrictions that currently exist.

Lines of credit should be created, within the framework of multilateral financial institutions such as the Inter-American Development Bank (IDB), to promote innovation, technology transfer and diffusion of technology in the Southern Hemisphere. These lines of credit would help bring about, in the FTAA, the commitment undertaken by developed countries under Article 7 of the TRIPS Agreement.

Agreements reached at the 6th Business Forum of the Americas110

The above-mentioned issue was discussed during the development of the 6th Business Forum of the Americas,111 held in Buenos Aires on April 5-6, 2001. Regarding intellectual property, businesspeople agreed with the following recommendations:

Promoting studies of domain names in relation to trademarks and trade names, and that such topics should be considered jointly by groups involved in intellectual property and electronic commerce.

Adopting, within the FTAA, measures to ensure intellectual property rights and service marks and provide protection for software.

Recommending studies on biodiversity and traditional knowledge in relation to intellectual property.

Studying and proposing measures of technological protection to encourage rights holders and users to establish rules that prevent internet piracy.

Recommending that government agencies in FTAA countries adopt domestic measures to ensure the use of legal computer programs.

Studying and proposing measures to facilitate technology transfer to developing countries, in order to reduce disparities in the economies of their respective continents.

Creating lines of credit within the multilateral financial institutions to promote innovation, technology transfer and dissemination of technology on the continent, accepting that private companies can act as a local counterpart.

Recommending that the FTAA chapter on Intellectual Property Rights should include a sub-section on geographical appellations and indications of provenance, including alcoholic beverages.

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ARGENTINA. Poder Ejecutivo Nacional. Decreto n° 260/1996. Ley de patentes de invención y modelos de utilidad, del 20 marzo de 1996, apruébase texto ordenado de la Ley nº 24.481, modificada por su similar nº 24.572 (T.O. 1996) y su reglamentación. Boletín Oficial, Buenos Aires, nº 28.360, 22 mar. 1996.

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BRASIL. Ministério da Ciência e Tecnologia. Lei nº 9.456, de 25 de abril de 1997. Institui a Lei de Proteção de Cultivares, e dá outras providências. Diário Oficial da União, Brasília, 28 abr. 1997. Seção I, p. 1.

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CARULLO, J. C.; MARÍ, M. El capital de riesgo en la Argentina: expectativas y nuevos enfoques. Trabalho apresentado no Third Triple Helix International Conference, Rio de Janeiro, abr. 2000.

CARULLO, J. C.; PASINI, M.; DELLACHA, J. Aplicación de la biotecnología en el sector de producción de biológicos de aplicación en sanidad animal. México: International Development and Research Centre; CamBioTec, 1999. 40 p. (Cuadernos de vigilancia tecnológica).

CASSEN, B.; CLAIRMONT, F. F. Globalización a marchas forzadas. Le Monde Diplomatique/El Dipló, Buenos Aires, v. 3, n. 30, p. 12-13, dic. 2001.

CHOCARRO, L.; GNERI, E. Patentes de protección en Argentina. Buenos Aires: Maxwell, Gandara & Hughes Patentes, 2000.

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CORREA, C. M. Normativa nacional, regional e internacional sobre propiedad intelectual y su aplicación en los INIAS del Cono Sur. Montevideo: Procisur, 1999. 38 p.

CORREA, C. M. Patentes y biotecnología: opciones para América Latina. Revista del Derecho Industrial, Buenos Aires, v. 12, n. 34, p. 5-53, ene./abr. 1990.

CORREA, C. M. Patentes, industria farmacéutica y biotecnología. Revista del Derecho Industrial, Buenos Aires, v. 12, n. 35, p. 335-343, mayo/ago. 1990.

DELLACHA, J. M. Argentina: prioridades y políticas para la biotecnología agropecuaria. Papers presented Turning Priorities into Feasible Programs: Proceedings of a Policy Seminar on Agricultural Biotechnology for Latin America, 6-10 October 1996, Lima, Peru. The Hague, México, D.F.: Intermediary Biotechnology Service / CamBioTec, 1999. p. 31-35.

DELLACHA, J. M. Biodiversidad y bioseguridad en la Argentina. Trabajo presentado en el Seminario de la Asociación Latinoamericana de Integración, ALADI, Cuba, 1996.

DELLACHA, J. M. Percepción pública de la agrobiotecnología. In: DELLACHA, J. (Ed.). Bioseguridad y percepción pública de la agrobiotecnología en Iberoamérica. Buenos Aires: Red Iberoamericana Multimodal de Vinculación y Desarrollo Biotecnológico, 2000. 45 p.

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HOKANSON, K.; HERON, D.; GUPTA, S.; KOEHLER, S.; ROSELAND, C.; SHANTHARAM, S.; TURNER, J.; WHITE, J.; SCHECHTMAN, M.; McCAMMON, S.; BECH, R. The concept of familiarity and pest resistant plants. Trabalho apresentado no Workshop on Ecological Effects of Pest Resistance Genes in Managed Ecosystems, realizado por Information Systems for Biotechnology, Bethesda, 1999.

JAFFÉ, W. Oportunidades y desafíos de la biotecnología para la agricultura y agroindustria de América Latina y el Caribe. Washington: Banco Interamericano de Desenvolvimento, 1996. 39 p.

KNAPP, L. Direito sobre plantas aduba polêmica em torno dos transgênicos. Gazeta Mercantil, São Paulo, 14, 15 e 16 out. 1999. Caderno Agribusiness, p. B-20.

KOBER, I. La Protección de la Propiedad Industrial en Europa y su situación en el mundo. Trabalho apresentado na Conferência sobre Proteção da Propriedade Intelectual na Europa, Alicante, Espanha, maio. 2000.

MERCOSUL. Conselho do Mercado Comum. Mercosul/CMC/DEC n° 01/99: acordo de cooperação e facilitação sobre proteção das obtenções vegetais nos estados membros do Mercosul. Assunção, 1999.

MERCOSUL. Conselho do Mercado Comum. Mercosul/CMC/DEC nº 02/01: acordo-quadro sobre meio ambiente do Mercosul. Assunção, 2001.

MERCOSUL. Conselho do Mercado Comum. Mercosul/CMC/DEC nº 08/95: protocolo de harmonização de normas sobre propriedade intelectual no Mercosul em matéria de marcas, indicações de procedência e denominações de origem. Assunção, 1995.

MERCOSUL. Conselho do Mercado Comum. Mercosul/CMC/DEC nº 16/98: protocolo de harmonização de normas em matéria de desenho industrial. Rio de Janeiro, 1998.

MERCOSUL. Grupo Mercado Comum. Mercosul /GMC/RES n° 70/98: estandar Mercosul de terminologia de sementes. Rio de Janeiro, 1998.

MERCOSUL. Grupo Mercado Comum. Mercosul /GMC/RES nº 04/92: aprova regras sobre práticas adequadas para a fabricação e a inspeção da qualidade dos medicamentos. Buenos Aires, 1992.

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PARAGUAY. Presidencia de la República. Decreto nº 22.365, del 14 de agosto de 1998, por el cual se reglamenta la Ley n° 1.294 “De Marcas”. Gaceta Oficial, Asunción, 186 Bis, 30 set. 1998.

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Addresses of institutions on the Internet

Argentina

Agencia Nacional de Promoción Científica y Tecnológica – Agencia
www.agencia.gov.ar/

Consejo Nacional de Investigaciones Científicas y Técnicas – CONICET
http://www.conicet.gov.ar/

Foro Argentino de Biotecnologia
http://www.foarbi.org/ppal/

Instituto Nacional de Tecnología Agropecuaria – INTA
http://www.inta.gov.ar/

Ministerio de Economía y Producción – MECON
http://www.mecon.gov.ar/

Ministerio de Relaciones Exteriores, Comercio Internacional y Culto
http://www.cancilleria.gov.ar/

Por qué Biotecnología – El portal de la Biotecnología en español
http://www.porquebiotecnologia.com.ar/

Secretaría de Agricultura, Ganadería, Pesca y Alimentos – SAGPyA
http://www.sagpya.mecon.gov.ar/

Servicio Nacional de Sanidad y Calidad Agroalimentaria – SENASA
http://www.senasa.gov.ar/

Instituto Nacional de la Propriedad Industrial – INPI
http://www.inpi.gov.ar/

Brasil

Associação Brasileira das Empresas de Biotecnologia – ABRABI
http://www.abrabi.org.br/

Associação Brasileira de Tecnologistas de Sementes – ABRATES
http://www.abrates.org.br/

Associação Nacional de Biossegurança – ANBIO
http://www.anbio.org.br/

Associação Nacional de Pesquisa, Desenvolvimento e Engenharia das Empresas Inovadoras – ANPEI
http://www.anpei.org.br/

Comissão Técnica Nacional de Biossegurança – CTNBio
http://www.ctnbio.gov.br/

Embrapa Recursos Genéticos e Biotecnologia – Cenargen
http://www.cenargen.embrapa.br/

Conselho Nacional de Desenvolvimento Científico e Tecnológico – CNPq
http://www.cnpq.br/

Empresa Brasileira de Pesquisa Agropecuária – Embrapa
http://www.embrapa.br/

Financiadora de Estudos e Projetos – Finep
http://www.finep.gov.br/

Fundação de Amparo à Pesquisa do Estado de São Paulo – FAPESP
http://www.fapesp.br/

Base de Dados Tropical – BDT
http://www.bdt.fat.org.br/index

Ministério das Relações Exteriores
http://www.mre.gov.br/

Ministério da Ciência e Tecnologia
http://www.mct.gov.br/

Universidade de São Paulo – USP
http://www.usp.br/

Universidade Federal do Rio Grande do Sul – UFRGS
http://www.ufrgs.br/ufrgs/

Paraguay

Honorable Cámara de Diputados del Paraguay
http://www.camdip.gov.py/

Instituto Interamericano de Cooperación para la Agricultura – IICA
http://www.iica.org.py/

Ministerio de Industria y Comercio – Dirección General de Propiedad Industrial
http://www.mic.gov.py/propiedad_intelectual/

Presidencia de la República del Paraguay
http://www.presidencia.gov.py/

Proparaguay – Dirección Nacional de Promoción de las Exportaciones e Inversiones
http://www.proparaguay.gov.py/

Secretaría Técnica de Planificación – STP
http://www.stp.gov.py/

Universidad Nacional de Asunción – UMA
http://www.una.py/

Uruguay

Instituto Nacional de Investigación Agropecuaria – INIA
http://www.inia.org.uy/

Instituto de Investigaciones Biológicas Clemente Estable – IIBCE
http://www.iibce.edu.uy/

Instituto Nacional de Semillas – INASE
http://www.inase.org.uy/

Ministerio de Educación y Cultura
http://www.dinacyt.gub.uy/

Ministerio de Ganadería, Agricultura y Pesca
http://www.mgap.gub.uy/

Red Académica Uruguaya – RAU
http://www.rau.edu.uy/

Universidad de la República
http://www.rau.edu.uy/universidad/

General

Animal and Plant Health Inspection Service – APHIS
http://www.aphis.usda.gov/

Biodiversidad en América Latina
http://www.biodiversidadla.org/

Bioplanet
http://www.bioplanet.net/

Biotecnologia, Ciência & Desenvolvimento
http://www.biotecnologia.com.br/

Canadian Food Inspection Agency – CFIA
http://www.inspection.gc.ca/

Oficina Regional para América Latina y el Caribe
http://www.idrc.ca/lacro/

Genetic Resources Action International – GRAIN
http://www.grain.org/front/

The International Development Research Centre – IDRC
http://www.idrc.ca/en/ev-1-201-1-DO_TOPIC.html

International Service for the Acquisition of Agri-biotech Applications – ISAAA
http://www.isaaa.org/

Programa Cooperativo para el Desarrollo Tecnológico Agroalimentario y Agroindustrial del Cono Sur – PROCISUR
http://www.procisur.org.uy/

Red de Cooperación Técnica en Biotecnolgía Vegetal – REDBIO
http://www.rlc.fao.org/redes/redbio/

Sistema Multinacional de Información Especializada en Biotecnología y Tecnología de Alimentos para América Latina y el Caribe – Simbiosis
http://www.bdt.fat.org.br/simbiosis/

Sistema de Información sobre Comercio Exterior – SICE
http://www.sice.oas.org/defaults.asp

World Intellectual Property Organization – WIPO
http://www.wipo.int/portal/index.html.en

Notes

1 Database of REDBIO, membership listing of the Argentine Forum on Biotechnology (FAB) [Foro Argentino de Biotecnología] and the Directory of Biotechnology Institutions [Diretório de Instituições Biotecnológicas], Fiocruz Foundation website: http://www.procc.fiocruz.br.

2 Diagnósticos Vegetales SRL, Garbi Biotecnología Vegetal, Laboratorio de Cultivo in vitro Proarpa S.A., Propagar and Tecnoplant S.A., members of REDBIO.

3 Between June 1999 and June 2000, the Argentine pharmaceutical industry sold US$ 3.840 billion in products, of which US$ 3.3 billion was for products sold by prescription and US$ 540 million was for OTC products.

4 The industry suffered a setback in its production capacity as a result of the status achieved (and now lost) by Argentina, as a country free of foot-and-mouth disease without vaccination.

5 Data corresponding to the companies organized in CAPROVE for the year 2000, representing approximately 70% of the domestic market.

6 Conducted by Leonardo Vaccarezza, from the Institute for Social Studies of Science & Technology [Instituto de Estudios Sociales de la CyT], at the National University of Quilmes, hired by the Argentine Focal Point of CamBioTec, among 100 directors of companies in the food industry. It was published in April 2000.

7 FONTAR was created in 1993 under the Department of Economic Programming [Secretaría de Programación Económica] of the Ministry of Economy [Ministerio de Economía]. In 1996 it was incorporated into the Department of Science and Technology [Secretaría de Ciencia y Tecnología] to form, with the Fund for Scientific and Technological Research (FONCyT) [Fondo para la Investigación Científica y Tecnológica], the National Agency for the Promotion of Science and Technology (ANPCyT) [Agencia Nacional de Promoción Científica y Tecnológica].

8 The survey was conducted during 2000, by the Incubators and Science Parks Program of the National University of La Plata.

9 According to information from the Biotechnology Program of the Multi-Year National Science and Technology Plan (PNPCyT) [Plan Nacional Plurianual de Ciencia y Tecnología] (1999-2001).

10 http://www.porquebiotecnologia.com.ar

11 Martín Piñeiro and Eduardo Trigo, directors of the CEO Group [Grupo CEO], Campo 21, November 8, 2000.

12 This point was based on the work of Alvarez, Edgar: La Biotecnología en Paraguay, Caacupé, Paraguay, 2000.

13 Information obtained from the website of PROCISUR: http://www.procisur.org.uy

14 The seminar was organized by the Argentine No Till Farmers Association (Aapresid) [Asociación Argentina de Productores en Siembra Directa] and the David Rockefeller Center for Latin American Studies, of Harvard University (DRCLAS), and was held in Mar del Plata, Uruguay.

15 Diario Noticias, July 24, 2001, http://www.diarionoticias.com.py

16 The origins of this lab date from 1992-93, at the initiative of a group of researchers from the Clemente Estable Institute of Biological Research (IIBCE) [Instituto de Investigaciónes Biológicas Clemente Estable]. Today, it works in a strategic alliance with a medical analysis laboratory, Fertilab.

17 For this purpose, a project was presented to the National Development Corporation, which is a public funding agency for venture capital projects.

18 The entrepreneurs feel that the production of biological materials has been disabled in the region and that this loss of capacity affects the production of vaccines, the ability of countries to deal with health emergencies and the capability to develop other associated products such as vaccines against rabies, among others.

19 The government supports the development of the fruits and vegetables sector, subsidizing 50% of the reconversion costs for the productive sector. Santa Rosa won an international tender to supply the materials required by the program, covering 100% of national market demand in this area.

20 On the basis of this activity, there is a collaborative program with the company Vinos Finos Juan Carrau.

21 This indicates that the market in Brazil is important; however, there are many customs barriers that hinder the entry and sale of these products.

22 They are opening the Mexican market and intend to enter the South African market.

23 The mechanism used is the acquisition of a percentage of the share package, which in the period of 4 years must be reacquired by the company or sold in the market.

24 Biotechnology was chosen as the field to develop the first experiment in establishing priorities.

25 Some experts take into account the existence of about 50 biotechnologists who are pursuing their own lines of work, and the more than 300 people trained or in training for these activities.

26 To date, this issue has not gained prominence in the debate of political parties in Uruguay; there are supporters and opponents of the application of biotechnology in most political parties represented in Parliament.

27 The thrust of the campaign was to try to install a contradiction between the primary external image of the country, i.e., “Uruguay, a natural country,” and the application of technological knowledge in various fields of production, particularly in the agricultural sector.

28 The main parties involved in this new process are organized around the National Outlook Observation Committee [Observatorio Nacional de Prospectiva], an institution linked to the Presidency.

29 The President at the time, Tabaré Vásquez, was a leading proponent of the policy of innovation and support for the development of biotechnology.

30 http://www.biodiv.org

31 This topic was based on the work of Neffa (2000).

32 This point was based on the work of Kors, Jorge: La propiedad intelectual y la Ley de Confidencialidad. 2nd Congress on Intellectual Property, University of Buenos Aires, Department of Science and Technology, Science and Technology Series of the UBA, Buenos Aires, August 24-25, 1998.

33 This point has been elaborated based on the work of Correa et al. (1996).

34 The literature often refers to this as TRIPS.

35 A sui generis system is one developed for a special purpose. See European Federation of Biotechnology (1996), Patenting in Biotechnology, Bulletin of the EFB, Number 1, September 1996.

36 Building upon the work of Correa et al. (1996), and Correa (1998).

37 Currently, most litigation occurs in the field of plant biotechnology, an area which, being in strong expansion, triggers frequent disputes. The average cost of a lawsuit in Argentina for a patent for a crop of some importance, according to one study, is on the order of US$ 3 million for each company involved. These disputes have affected the main products of biotechnology. For example, in the pharmaceutical field, there have been some lawsuits in the areas of interferon B, tissue plasminogen activator (tPA), human growth hormone and erythropoietin (CORREA, 1998).

38 Directive 98/44/EC of the European Parliament and of the Council of 6 July 1998 on the legal protection of biotechnological inventions, (EUROPEAN COMMISSION, 1998).

39 Judgment of the Court of Justice of European Communities of 9 October 2001, in Case C-377/98 Netherlands v European Parliament and Council.

40 European Commission: Report of the Commission to the European Parliament and Council, COM (2002) 2 final, Brussels, January 14, 2002.

41 Developed based on work by Correa (1996).

42 Developed based on work by the European Biotechnology Foundation (1996).

43 Text based on work by Correa et al. (1996).

44 National Executive of Argentina: Ley No. 28.360/96, de Patentes de Invención y Modelos de Utilidad (Decreto 260/96), Boletín Oficial de la República Argentina, Buenos Aires, March 22, 1996.

45 Senate and Chamber of Deputies of Argentina: Ley No. 20.247/73, de Semillas y Creaciones Fitogenéticas, Buenos Aires, March 30, 1973.

46 Senate and Chamber of Deputies of Argentina: Ley No. 24.376/94, Aprobación del Convenio Internacional para la Protección de las Obtenciones Vegetales, Buenos Aires, 1994.

47 Senate and Chamber of Deputies of Argentina: Ley No. 20.247/73, de Semillas y Creaciones Fitogenéticas, Buenos Aires, March 30, 1973.

48 National Congress of Paraguay: Ley No. 1.630, de Patentes de Invenciones, Asunción, November 29, 2000.

49 National Congress of Paraguay: Ley No. 1.294, de Marcas, Asunción, August 6, 1998.

50 National Congress of Paraguay: Ley No. 385, de semillas y Protección de Cultivares, Asunción, August 11, 1994.

51 National Congress of Paraguay: Ley No. 1.630, de Patentes de Invenciones, Asunción, November 29, 2000.

52 National Congress of Paraguay: Ley No. 1.294, de Marcas, Asunción, August 6, 1998.

53 See the website of the Directorate of Intellectual Property (DGPI) [Dirección General de Propiedad Intelectual] of Paraguay’s Ministry of Industry and Commerce (MIC) [Ministerio de Industria y Comercio]: http://www.mic.gov.py/v1/node/43.

54 Senate and House of Representatives of the Oriental Republic of Uruguay: Ley No. 17.164, regula los derechos y obligaciones relativos a las patentes de invención, los modelos de utilidad y los diseños industriales, Montevideo, September 2, 1999.

55 Senate and House of Representatives of the Oriental Republic of Uruguay: Ley No. 16.076, Centro Nacional de la Propiedad Industrial, sustitúyese disposición de la Ley No. 9.956, Marcas de fábrica, comercio y agricultura, Montevideo, November 13, 1989.

56 Senate and House of Representatives of the Oriental Republic of Uruguay: Ley No. 16.811, Instituto Nacional de Semillas. créase y declárase de interés nacional, Montevideo, February 22, 1997.

57 Senate and House of Representatives of the Oriental Republic of Uruguay: Ley No. 16.580, Protección de las Obtenciones Vegetales. Convenio Internacional Suscrito en París, República de Francia, Montevideo, October 4, 1994.

58 Department of Sustainable Development and Environmental Policy of the Ministry of Social Development and Environment (MDSyMA). Convention on Biological Diversity, the Second National Report of the Parties, Buenos Aires, May 2001. Website of the Convention on Biological Diversity (CBD).

59 Argentine Chamber of Deputies: Proyecto de ley de Bioseguridad en la Aplicación de la Biotecnología Agropecuaria, Buenos Aires, 2001.

60 Argentine Chamber of Deputies, op. cit.

61 To date, the institutional framework to which that Committee belonged to has been established. Provision has been made for it to be located within SENASA, but there are proposals to raise the its status to the level of the Enforcement Authority Committee.

62 National Congress of Paraguay: Ley No. 385, ee Semillas y Protección de Cultivares, Asunción, August 11, 1994.

63 National Congress of Paraguay. Ley No. 123/91, que adoptan nuevas formas de protección fitosanitaria, Asunción, 1991.

64 Presidency of the Republic of Paraguay: Decreto No. 18.481/97, por el cual se crea la Comisión de Bioseguridad, Asunción, 1997.

65 National Congress of Paraguay: Law No. 294/93 de Evaluación de Impacto Ambiental, Asunción, 1993.

66 National Congress of Paraguay: Law No. 253/93, que aprueba el Convenio sobre Diversidad Biológica, adoptado durante la Conferencia de las Naciones Unidas sobre el Medio Ambiente y Desarrollo, Asunción, 1993.

67 Ministry of Agriculture and Livestock of Paraguay: Resolución MAG No. 397/2000, Noticias, October 3, 2000.

68 This point was elaborated based on the work of Zalduendo, La Propiedad lntelectual en el Mercosur, 2nd Congress on Intellectual Property, University of Buenos Aires (UBA), Department of Science and Technology, Science and Technology Series, UBA, Buenos Aires, August 24-25, 1998.

69 Argenntina’s Ministry of Agriculture, Livestock, Fisheries and Food (SAGPyA): Bioseguridad Agropecuaria: hacia la comercialización de vegetales y vacunas genéticamente modificados, SAGPyA, Buenos Aires, September 1997.

70 President of the Republic of Uruguay: Decreto No. 249/00, de la creación de la Comisión de Evaluación de Riesgo de Vegetales Genéticamente Modificados, Montevideo, August 30, 2000.

71 In accordance with the provisions of Law No. 16,466 dated January 19, 1994, and its regulations.

72 Presidency of the Republic of Uruguay: Decreto No. 80/86, de la creación del Comité Nacional de Biotecnología de Uruguay, Montevideo, 1986.

73 This point was developed based on the work of Zalduendo, La Propiedad lntelectual en el Mercosur, 2nd Congress on Intellectual Property, University of Buenos Aires (UBA), Department of Science and Technology, Science and Technology Series, UBA, Buenos Aires, August 24-25, 1998.

74 MERCOSUR/CMC/DEC. No. 08/95: Protocolo de Armonización de Normas sobre Propiedad Intelectual en el MERCOSUR, en materia de Marcas, Indicaciones de Procedencia y Denominaciones de Orígen.

75 MERCOSUR/CMC/DEC No. 01/99: Acuerdo de Cooperación y Facilitación sobre la Protección de las Obtenciones Vegetales, based on Recommendation No. 2/98 of Work Subgroup No. 8 (SGT-8): “Agriculture.”

76 MERCOSUR/CMC/DEC No. 16/98: Protocolo de Armonización de Normas en Materia de Diseños Industriales, approved based on Recommendation No. 7/94 of Work Subgroup No. 7 (SGT-7): “Industry.”

77 Information taken from the website of the National Advisory Commission on Agricultural Biotechnology (CONABIA) [Comisión Nacional Asesora de Biotecnología Agropecuaria] http://www.mecon.gov.ar/conabia

78 MERCOSUR/CMC/DEC No. 2/01: Acuerdo Marco sobre Medio Ambiente del MERCOSUR, based on Recommendation No. 1/01 from Work Subgroup No. 6 (SGT-6): “Environment.”

79 MERCOSUR/GMC/RES No. 46/96: Marco Regulatorio para el Tratamiento de la Genética Animal de Bovinos, Caprinos, Ovinos, Equinos y Porcinos en el MERCOSUR, based on Recommendation No. 2/96 of Work Subgroup No. 8 (SGT-8): “Agriculture.”

80 MERCOSUR/GMC/RES No. 11/93: Marco Regulatorio para Productos Veterinarios, based on Recommendation No. 2/93 of Work Subgroup No. 3 (SGT-3): “Technical Regulations.”

81 MERCOSUR/GMC/RES No. 04/92: Reglas sobre Prácticas Adecuadas para la Fabricación y la Inspección de la Calidad de los Medicamentos, based on Recommendation No. 5 of Work Subgroup No. 3 (SGT-3): “Technical Regulations.”

82 MERCOSUR/GMC/RES No. 70/98: Estándar Mercosur de Terminología de Semillas, based on Recommendation No. 20/98 from Work Subgroup No. 8 (SGT-8): “Agriculture.”

83 Agreement on Trade-Related Aspects of Intellectual Property Rights, established in the framework of the Uruguay Round of the World Trade Organization.

84 Executive Branch of Argentina: Ley No. 24.481, modificada por la Ley 24.572, T.O. 1996, de Patentes de Invención y Modelos de Utilidad, in Boletín Oficial de la República de Argentina, No. 28,360, Buenos Aires, March 22, 1996.

85 President of the Republic of Brazil: Lei No. 9.279, Regula direitos e obrigações relativos à propriedade industrial, Brasília, May 14, 1996.

86 National Congress of Paraguay: Ley No. 1.630, de Patentes de Invenciones, Asunción, November 29, 2000.

87 President of Brazil: Lei No. 10.196, Altera e acresce dispositivos à lei nº 9.279, de 14 de maio de 1996, que regula direitos e obrigações relativos à propriedade industrial, e dá outras providências, Brasília, February 14, 2001.

88 INPI recognizes, for receiving deposits of microorganisms, the depositary institutions recognized by the World Intellectual Property Organization (WIPO), or those which meet the following conditions: they must be permanent; they must not be dependent on the control of the depositors; they must have staff and adequate facilities to verify the relevance of the deposit and ensure its preservation and storage without risk of contamination; and they must provide necessary security measures to minimize the risk of loss of the deposited material.

89 Senate and Chamber of Deputies of Argentina: Ley No. 20.247, Ley de semillas y creaciones fitogenéticas, Buenos Aires, March 30, 1973.

90 National Congress of Paraguay: Ley No. 123/91, “que adoptan nuevas formas de protección fitosanitarias,” Asunción, 1991.

91 Senate and House of Representatives of the Oriental Republic of Uruguay: Ley No. 16.811 Instituto Nacional de Semillas: Créase y declárase de interés nacional, Montevideo, February 22, 1997.

92 President of Brazil: Lei No. 9.456, Institui a Lei de Proteção de Cultivares e dá outras providências, Brazil’s Federal Official Gazette [Diário Oficial da União (D.O.U.)], April 28, 1997.

93 Senate and Chamber of Deputies of Argentina: Ley No. 24.376/94, Aprovación del Convenio Internacional para la Protección de las Obtenciones Vegetales, Buenos Aires, 1994.

94 President of Brazil: Lei No. 9.456, Institui a Lei de Proteção de Cultivares e dá outras providências, Brazil’s Federal Official Gazette [Diário Oficial da União (D.O.U.)], April 28, 1997.

95 Senate and House of Representatives of the Oriental Republic of Uruguay: Ley No. 16.580, Protección de las Obtenciones Vegetales; Convenio Internacional Suscrito en París, República de Francia, Montevideo, October 4, 1994.

96 Senate and House of Representatives of the Oriental Republic of Uruguay: Ley No. 16.811, Instituto Nacional de Semillas: Créase y declárase de interés nacional, Montevideo, February 22, 1997.

97 In the case of Argentina, INASE was dissolved by decree of the Executive branch, but continues to serve as INASE, while discussing a new institutional status.

98 Argentina’s Ministry of Agriculture, Livestock, Fisheries and Food (SAGPyA): Resolución 124/91, Creación de la Comisión Nacional Asesora de Biotecnología Agropecuaria (CONABIA), Buenos Aires, 1992.

99 Argentina’s National Service for Agrifood Health and Quality (SENASA): Resolucón 1.265/99, Creación del Comité Técnico Asesor sobre Uso de Organismos Genéticamente Modificados, Buenos Aires, 1999.

100 Argentina’s Department of Health and Social Action: Resolución de creación de la Comisión Nacional de Biotecnología y Salud (CONBYSA), Buenos Aires, 1994.

101 Paraguay’s Advisory Committee for Biotechnology (CAB) includes representatives from the Network of Environmental Organizations of Paraguay (ROAM) [Red de Organizaciones Ambientalistas del Paraguay].

102 In the case of living matter, when not used for commercial multiplication or propagation.

103 This must be a permanent institution, must not depend on the applicant, must have adequate facilities and staff and must have security measures that ensure no escape or losses.

104 The term “variety,” when used to indicate a cultivated variety, is equivalent to the term “cultivar”.

105 Except for the cultivation of sugarcane, which requires the authorization of the breeder with or without payment of fees for exploitations that exceed the minimum established by law.

106 Free Trade Area of the Americas (FTAA): FTAA Draft Agreement, FTAA Ministerial Meeting, Buenos Aires, July 3, 2001, http://www.vi-fema-abf.org.ar

107 Brazilian Association of Industries of Fine Chemistry, Biotechnology and their Specialties (ABIFINA) (2001): Necesaria vinculación entre el régimen de la competencia y la propiedad intelectual, Taller sobre Propriedad Intelectual, VI Foro Empresarial de las Américas, Buenos Aires, June 21, 2001, http://www.vi-fema-abf.org.ar

108 Argentine Industrial Union: Taller sobre Propriedad Intelectual, VI Foro Empresarial de las Américas, Buenos Aires, June 21, 2001, http://www.vi-fema-abf.org.ar

109 Mercosur Industrial Council: Taller sobre Propriedad Intelectual, VI Foro Empresarial de las Américas, Buenos Aires, June 21, 2001, http://www.vi-fema-abf.org.ar

110 Free Trade Area of the Americas (FTAA): Conclusiones, VI Foro Empresarial de las Américas, Buenos Aires, June 21, 2001, http://www.vi-fema-abf.org.ar

111 One of the officially organized forums to develop the organizational process of the FTAA.