Challenges of regulating access and benefit-sharing in South Africa

Challenges of regulating access and benefit-sharing in South Africa Mandy Taylor Cheadle, Thompson and Haysom attorneys, South Africa Rachel Wynberg Environmental Evaluation Unit, University of Cape Town

Focus of presentation • Overview of South African ABS regulatory framework • Challenges raised by regulatory framework • Conclusions and recommendations

Introduction • Substantial interest in bioprospecting in South Africa over last 15 years • Legislative vacuum until promulgation of the Biodiversity Act • Parts regulating ABS came into effect in January 2006 • Regulations required to give effect to the Act not yet in force • Pre-legislation: regulated by bilateral contracts (eg SANBI-Ball; CSIR-Phytopharm; CSIR-San; University of Free State – New York Botanic Gardens - Merck)

Benefit-sharing in South Africa • Absence of legal framework a major reason for failure of bioprospecting to deliver optimal benefits • SANBI / Ball agreement - weak technology transfer components • Failure of CSIR to obtain PIC from San before lodging patent based on their knowledge has resulted in limited benefit-sharing options • Lack of clarity with regard to benefit-sharing from potential new antibiotic developed from SA soil samples • But also increased national and regional collaborative ventures

The Biodiversity Act • Framework legislation: all areas of biodiversity conservation and use • Establishes the South African National Biodiversity Institute (SANBI) • Provides for coordinated biodiversity planning • Deals with threatened or protected ecosystems and species • Regulates alien and invasive species

Chapter 6 regulates ABS • Primary legislative means for regulating ABS in SA • Came into effect on 1 January, 2006 • Provides fairly sparse legislative framework -detail to be regulated in subordinate national legislation

Framework of Chapter 6 • Permit required - • for bioprospecting involving indigenous biological resources • to export indigenous biological resources for bioprospecting/other research • Permit only issued if material disclosure to stakeholders and if their consent to the project has been obtained • Consent reflected in benefit-sharing agreement that allows for sharing in future benefits from the bioprospecting or research • Permitting authorities designated by regulation • Permitting authorities may issue integrated permits • Minister can exempt certain activities or species, from application of the ABS chapter

Prior informed consent of stakeholders • Must obtain stakeholders’ prior informed consent to bioprospecting • Two categories of stakeholders in Act - • those giving access to indigenous biological resources • communities with traditional knowledge of resources

Benefit sharing agreements • Stakeholders’ consent reflected in - • benefit-sharing agreements • material transfer agreements • Negotiations to be conducted on an equal footing • Regular review of benefit-sharing agreements

Bioprospecting Trust Fund • All money from benefit sharing agreements to be paid into Fund • Fund will administer payments to stakeholders • Fund only a conduit for money due to stakeholders

Draft Access and Benefit Sharing Regulations • Lengthy consultative process • Published for public comment • Not yet finalised – expected to be finalised April 2008 • Draft regulations tried to address some of challenges identified with Act • Regulations = subordinate legislation • Some challenges require legislative amendment

Key challenges of Act • Ensuring some benefits serve national interests • Ownership over genetic resources? • Does the Act hinder academic research? • Distinguishing bioprospecting from biotrade • Identification of indigenous communities • Implementation and capacity building

Ensuring that Benefits from Bioprospecting Serve National Interests • Benefits to stakeholders only • If State = landowner it can ensure appropriate sharing of benefits in the public interest • If the resources collected on private land, may be no wider benefit to community

Benefits from bioprospecting to serve national interests Approach of draft regulations • Require foreign bioprospectors to collaborate with South African partners • Require benefit-sharing agreements to include a benefit for wider community • Prescribes how the State may use benefits that accrue to the State

Benefits from bioprospecting to serve national interests Legislative amendment required The following changes cannot be introduced by regulations: • Vesting ownership of genetic resources in the State • Portion of any financial benefit to be paid to Bioprospecting Trust Fund for – • conservation of resources • building capacity in indigenous communities • supporting research on indigenous knowledge • enhancing scientific knowledge and technical capacity of South African people and institutions

Ownership of Genetic Resources? Constitutionally protected property rights • Does giving the State ownership over genetic resources infringe property rights? • Constitution and Biodiversity Act silent on ownership of genetic resources • State only benefits from bioprospecting if resources collected on State land Section 25 of the Constitution • No one may be deprived of property except in terms of a law of general application and no law may permit arbitrary deprivation. • Property may be expropriated for a public purpose or in the public interest, and on payment of just and equitable compensation

Ownership of Genetic Resources? Common law • A landowner owns everything beneath and above the land • Common law silent on issue of ownership over genetic resources • Common law can be amended by legislation if legislation in line with Constitution Can one separate out elements of ownership? • Ownership over genetic resources: State • Ownership of physical resources: landowners

Does the Act hinder academic research? Act throws net wide – • permit must be issued before bioprospecting of indigenous biological resources can take place • bioprospecting and indigenous biological resources defined broadly • material transfer agreements and benefit-sharing agreements required even for exploratory stages of a project

Does the Act hinder academic research? • Over-regulation of the pre-commercial phase of a bioprospecting project may hamper academic research • Academic research already regulated by provinces • At early stage of a project, the commercial outputs are unclear - difficult for parties to enter into a benefit-sharing agreement as envisaged by the Act Approach of draft regulations • Differentiate between discovery phase and commercial phase of a bioprospecting project • Permit not required for discovery phase – only notification procedure • Provision for integrated bioprospecting and export permit

Distinguishing bioprospecting from biotrade • Definitions of bioprospecting and indigenous biological resources wide and could be interpreted to include trade • Increasingly best practice to require BSAs for both genetic resources and biological resources traded as commodities (eg Hoodia) • Regulations may exempt certain activities and species from provisions but confusion still exists for other species traded as commodities

Identification of indigenous communities • Stakeholder: indigenous communities whose knowledge or traditional use of indigenous biological resources has contributed to, or is likely to contribute to, the bioprospecting. • “Indigenous communities” not defined • Consultation raised a number of difficulties in identifying correct stakeholders

Identification of indigenous communities Approach of regulations • Introduces principles for identifying community stakeholders • Introduces facilitation if there is a dispute around community identification

Implementation of the Act and the regulations • Building government capacity • Popularise regulations • Develop practical guidelines for different audiences • Capacity-building workshops for different stakeholders • Establish expert ABS task team to advise national dept • Dovetailing ABS regulation with requirements to protect farmers’ rights to give effect to the International Treaty on Plant Genetic Resources for Food and Agriculture (IRPGRFA)

Summary of conclusions and recommendations • The primary legislation should resolve issues of ownership or should put in place other mechanisms for ensuring that some benefit resulting from bioprospecting flows to the wider community • The legislation must facilitate rather than hinder academic research by ensuring that the permit costs and bureaucratic hurdles are not prohibitive

Summary of conclusions and recommendations • The legislation must clearly distinguish between bioprospecting and biotrade and the regulation of each must be appropriate • Ways must be found for determining that the appropriate indigenous communities or individuals from those communities benefit in cases involving traditional knowledge or use

Challenges of regulating access and benefit-sharing in South Africa