The global multilateral benefit-sharing mechanism under the Nagoya Protocol

The global multilateral benefit-sharing mechanism under the Nagoya Protocol

Article 10 of the Nagoya Protocol provides for Parties to consider the need for and the modalities of a global multilateral benefit sharing mechanism for situations not covered under a bilateral approach. But why is it so difficult for Parties to settle the things straight on this matter?

One of the most discussed topics at the COP14 was the global multilateral benefit-sharing mechanism (GMBSM). During the negotiations of the Nagoya Protocol, there were several issues identified on which parties could not agree on and for which further discussion was required, so Article 10 was meant to offer a frame in which these issues could be tackled at a later stage.  

Article 10 addresses situations where ABS requirements cannot be met through a bilateral approach and distinguishes between three situations: where genetic resources occur in transboundary situations; where it is not possible to grant prior informed consent (PIC) for genetic resources; and where it is not possible to obtain PIC.

Although Article 10 helped at the final stage of negotiations to defer the definition of fundamental yet controversial topics of the Nagoya Protocol, it provides only an enabling clause, which means the Parties still have to decide upon the actual need for and the modalities of such a mechanism.     

Nevertheless, consideration of the range of circumstances in which there might be a need for a global multilateral benefit-sharing mechanism is likely to prove politically challenging, given the link with broader discussions on interpretation of the objective, scope, and obligations of the Nagoya Protocol.

The need for a Global Multilateral Benefit-Sharing Mechanism (GMBSM)

A global multilateral benefit-sharing mechanism aims to provide a frame that will apply for situations not covered under the bilateral approach. However, the scenario of genetic resources and associated traditional knowledge found in transboundary situations does not support the need for such a global mechanism, for the reason that this is already settled under the Article 11 of the Protocol.

There are still other scenarios that may support the need for a global multilateral benefit-sharing system, in the case where these scenarios won’t find a solution under other provision of the Nagoya Protocol. For example, in situations where an individual or organization not involved in the original acquisition of the genetic resources is utilizing them without being able to trace back the provider country among the several countries of origin, or in the situation where Parties do not have operational ABS systems or provide no solutions for specific circumstances. In these scenarios, a global multilateral benefit-sharing mechanism would enable users to discharge their benefit-sharing obligation.

Furthermore, a multilateral approach would entail advantages such as viable solutions for difficult problems in ABS, more reasonable transaction timelines and costs, and innovative financial mechanisms for conservation and sustainable use of biodiversity, covering those circumstances that have escaped bilateral solutions. 

Additionally, it could create an opportunity for private users to voluntarily apply ABS principles to cases in which there are no legal obligations to share benefits, but users of genetic resources choose to do so for ethical, corporate responsibility, or marketing reasons, for example in the case of publicly available traditional knowledge or pre-CBD accessions.  

How would the Global Multilateral Benefit-Sharing Mechanism work?

In order to answer this question, we can look at existing benefit-sharing mechanisms at the multilateral level. In this regard, the most important precedent is the Multilateral System for ABS established by the International Treaty on Plant Genetic Resources for Food and Agriculture (ITPGRFA). This system provides a global pool of plant genetic resources for food and agriculture, focused on a select group of crop species for which access for research and breeding is facilitated, subject to benefit-sharing in cases in which further research and breeding is restricted.  

The benefits shared under ITPGRFA multilateral system include non-monetary benefits, such as exchange of information, access to and transfer of technology, capacity building, as well as monetary benefits arising from commercialization. Still, there are fundamental differences between the multilateral system under the ITPGRFA and the potential one from the Nagoya Protocol that will limit the opportunities for Parties to draw on the multilateral system for inspiration. For example, ITPGRFA’s system addresses one specific sector only. Therefore, even looking at other multilateral mechanisms, might still not provide answers to some questions raised by a potential multilateral system under article 10.

State of the art and future steps

At the Third meeting of the COP to the Nagoya Protocol on ABS, the Expert Group concluded that there is insufficient information or experience to determine whether there is a need for a GMBSM. While the recommendation adopted by the Subsidiary Body on Implementation stated that the need has been sufficiently demonstrated and Parties should start considering the modalities of a GMBSM.

Parties, organizations and stakeholders were also invited to submit their opinions and share their experiences with regards to article 10. They all seem to have very different takes on the matter given their distinctive experiences. Which only shows that the biggest challenge at the moment is the issue of inharmonious implementation of the Nagoya Protocol.

Moreover, in tackling discussions arising from article 10, attention should be focused on constructing a comprehensive global mechanism that does not create disadvantages for stakeholders who are less equipped to obtain the benefits generated at a global level.

Taking all discussions and opinions about article 10 into consideration, it seems that coming to a conclusion that will satisfy all Parties is hard to imagine. Since different countries have different experiences with the implementation of the Nagoya Protocol. At this stage, it looks impossible to apply a mechanism that will fit all the needs. This only shows that, indeed more information about Parties’ experiences is needed.

If the Parties want to go further with the MGBSM, they should first fix the other problems raised under the framework of the Nagoya Protocol, in order to make sure that the reasons for establishing such a mechanism are relevant and especially existing.

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  • Avatar
    Syed Talal Raza Shah
    20/03/2019, 11:52 am

    The article is compendious and sums up with minutiae details.

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  • Avatar
    Joseph Henry Vogel
    25/03/2019, 4:14 pm

    Distinct are the need for the Global Multilateral Benefit-Sharing Mechanism (GMBSM) and agreeing upon that need. This crucial distinction seems to have escaped the author. The need is established when one considers the minuscule monetary benefits generated under the bilateral approach despite global biotechnology sales approximating one trillion dollars per year. The reason for the lack of agreement is also apparent: a GMBSM could conceivably generate billions of dollars in royalty revenues.

    The situations where a GMBSM would apply are those for which the genetic resource is transboundary. The Nagoya Protocol does not define “transboundary” and, similarly, the CBD does not define “material” in reference to “genetic material”. Any reasonable interpretation of “material” includes “information”, which thereby sheds light on “transboundary”. Most natural information is transboundary, i.e. diffused across many species and the species, across jurisdictions. Diffusion implies that the bilateral system would be appropriate for very very (keep on adding the very’s!) few genetic resources. Most importantly, the economics of information—extremely powerful in its abstraction—-justifies an “economic rent” for genetic resources. N.B: Rents are eliminated through competition among Providers in the bilateral approach.

    This article makes no contact whatsoever with the powerful abstraction of Economics. It integrates with a long trajectory of legal writing about ABS which has studiously ignored “the economics of information” and wrongly assumed that the bilateral approach is non-negotiable. Such studied ignorance is “the tragedy of unpersuasive power”, which ultimately translates into habitat loss and extinction (http://www.ccsenet.org/journal/index.php/ijb/article/view/30097/18019).

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