1 Sharing of benefits from genetic sources
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14641/12
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COM(12) 576
(b)
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14728/12
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COM(12) 577
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Draft Regulation on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilisation in the Union
Draft Council Decision on the conclusion of the Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilisation to the Convention on Biological Diversity
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| Legal base | (a) Article 192(1) TFEU; co-decision; QMV
(b) Articles 192(1) and 218(6) TFEU; QMV; consent
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| Department | Environment, Food and Rural Affairs
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| Basis of consideration | Minister's letters of 28 August and 21 October 2013
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| Previous Committee Report | HC 86-xviii (2012-13), chapter 4 (31 October 2012)
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| Discussion in Council | See para 1.12 below
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| Committee's assessment | Legally and politically important
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| Committee's decision | Not cleared; further information awaited
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Background
1.1 Genetic resources have a variety of purposes with a wide range
of users and resultant benefits. The Convention on Biological
Diversity (CBD) provides the main international framework for
conserving biological diversity and the equitable sharing of the
benefits, but it does not specify how this should be done in practice.
The Nagoya Protocol to the Convention therefore seeks to establish
more predictable conditions for access to genetic resources, ensuring
benefit-sharing and that only legally acquired sources are used.
All parties to the Protocol must take measures regarding user
compliance, but they are free to decide whether to regulate access:
however, if they do so, they must implement the detailed provisions
set out in the Protocol.
1.2 The Protocol is a mixed agreement with shared
competence, and has been signed by the EU and 24 Member States.
These two documents comprise (a), a draft Regulation implementing
those provisions falling within EU competence, and (b), a draft
Council Decision, enabling the EU to ratify the Protocol, once
the Regulation has been adopted. More specifically, the draft
Regulation would set out minimum due diligence measures; oblige
all users in the EU to exercise due diligence to ascertain that
genetic resources are accessed in accordance with the legal requirements
of provider countries, and that the benefits are fairly and equitably
shared; require all users to transfer to subsequent users information
relevant for access and benefit-sharing; require recipients of
public research funding to declare that they will exercise due
diligence; and oblige users to declare at the point of commercialisation
that they have complied with their due diligence obligation.
1.3 In order to comply, users could build on existing
codes of conduct for access and benefit sharing, and Member States
would be obliged to consider that implementation of recognised
best practice reduces the risk of non-compliance and justifies
a reduction in compliance checks. The proposal would also require
the Commission to establish an EU Register of Trusted Collections,
with those included in it having to undertake to supply only fully
documented samples of genetic resources. Member States would have
to verify whether a collection meets the necessary requirements,
and users acquiring a genetic resource from it would be considered
to have exercised due diligence. In addition, Member States would
be required to use a risk-based approach to check whether users
comply with their obligations, and they would have to ensure that
infringements are subject to effective, proportionate and dissuasive
penalties.
1.4 As we noted in our Report of 31 October 2012,
the Government agreed to Council Conclusions in June 2012 committing
the EU to ratifying and implementing the Nagoya Protocol as soon
as possible, and therefore welcomed the draft Council Decision,
except insofar as it would require the EU and Member States to
ratify simultaneously — a step for which it believed there
was no legal obligation, and which would mean the pace of ratification
being determined by the slowest to do so. However, it needed to
look in greater detail at the draft Regulation as regards the
requirements at national level to implement the Protocol and enable
the UK to ratify it.
1.5 In the meantime, it drew attention to a number
of preliminary concerns, including the possibility that certain
of the measures, for example those related to Trusted Collections,
might not be in accordance with the principle of subsidiarity,
with much of the detail having to be set out in Implementing Acts,
on which clarification was needed. We were also told that a full
analysis of subsidiarity would be undertaken ahead of the deadline
for raising any objection with the Commission, and that the Government
would have further opportunities to consider subsidiarity in any
subsequent proposal. Also, although independent research had been
commissioned to provide an analysis of the UK sectors likely to
be affected, the Government had yet to complete a detailed Impact
Assessment, but would undertake this for any final Regulation.
Finally, a detailed financial consideration of the proposal had
yet to be carried out, but an initial analysis suggested that
there would be minimal costs for Government and for users: and
stakeholders would be consulted further on the proposals in addition
to the consultations being conducted at EU level.
1.6 We commented that there appeared to be more to
the proposed Regulation than met the eye, including a number of
concerns in particular over subsidiarity, and, in noting that
the Government would be undertaking a full analysis of those issues,
we stressed the importance of our receiving this in good time
to allow the preparation of a draft Reasoned Opinion, if that
was seen to be required. In addition, we looked forward to receiving
the Government's detailed Impact Assessment, together with its
financial consideration of the proposal. In the meantime, we said
that we were holding both documents under scrutiny.
Subsequent developments
1.7 Despite the potential subsidiarity concerns,
and the strict timetable associated with these, the next we heard
from the Government was a letter of 28 August 2013 from the Parliamentary
Under Secretary at the Department for Environment, Food and Rural
Affairs (Lord de Mauley), saying that there had been no developments
on the draft Directive, but providing an update on the draft Regulation.
He said that, although discussions in the Council now appeared
to be moving in a sensible direction, the UK remained concerned
by many of the proposals still under consideration by the European
Parliament. He also said that the rapporteur for the Parliament's
Environment, Public Health and Food Safety Committee had not been
granted a mandate for the trilogue discussions, and that the proposal
would therefore be discussed at a plenary in either September
or October, pointing out that there would then be considerable
pressure to reach a first reading agreement in view of the European
Parliament elections in May 2014.
1.8 In the meantime, the Minister said that the UK
continued to support the Commission's proposed due diligence
approach (where the European Parliament had proposed additional
points at which users would be required to make declarations,
and for all declarations to be supported by evidence); that this
approach was supported by users of genetic resources (who were
opposed to the alternative prohibition approach supported by some
Member States, which the Government also could not support as
it would criminalise the use of illegally acquired genetic resources,
and discourage the pursuit of new benefits from genetic resources);
that the UK could not accept a European Parliament committee proposal
that the Regulation should apply retroactively to genetic resources
accessed before it entered into force; that it was seeking to
remove the Commission's suggestion that matters relating to traditional
knowledge should be addressed by the Regulation, regarding these
as Member State competences; and that concerns remained that the
proposed scheme for 'Trusted' or Registered Collections would
give the Commission unnecessarily broad powers to remove individual
collections without reference to Member States.
1.9 The Minister also referred briefly to developments
within the UK, and in particular to the fact that, alongside the
independent research it has commissioned in 2012 into the Protocol's
potential impact in the UK, it had been developing an initial
Impact Assessment, which would be used to support its final negotiations
in the trilogue. He said that, in view of the variety of possible
outcomes, a comprehensive Impact Assessment for each outcome was
not possible, but that the Government was assessing the possible
consequences of two alternative scenarios, and that he would ensure
that the details of this were communicated to us as soon as they
became available.
1.10 When we considered this letter on 11 September
2013, we noted that, despite the emphasis we had placed on the
issue of subsidiarity, the Minister's letter had made no mention
of this, despite it being the first communication we had received
from his department since our Report the previous October. Our
Chairman therefore replied, asking what the Government's conclusions
had been on subsidiarity, and why these had not been conveyed
to us, given the importance which the House attaches to this whole
issue.
1.11 We have now received from the Minister a letter
of 21 October 2013, saying that his officials had been under the
impression that a "nil" return on subsidiarity had been
provided before the deadline, and apologising for any misunderstanding
on this point. He says that implementation of the Nagoya Protocol
through a Regulation has clear advantages for users of genetic
resources in enabling them to operate throughout the EU, and in
helping to maintain the integrity of the Single Market, and he
notes that the Commission's Impact Assessment reported unanimous
support from stakeholders for
a EU harmonised approach. He does identify the proposed power
for the Commission to de-register Trusted Collections unilaterally
as one area where the subsidiarity test has not been met, but
says that the UK is well supported in the Council in opposing
this, and he believes that a subsidiarity compliant solution can
be found under which recommendations must be made by Member States
before a collection is removed.
1.12 The Minister also provides an update on the
position within the European Parliament, pointing out that its
plenary session on 16 September 2013 adopted the majority of its
Lead Committee's amendments. However, he adds that, although many
of the Parliament's amendments cut across the Government's position,
the UK's concerns are shared by the Commission and the majority
of Member States, and are reflected in the Presidency's mandate
for the forthcoming trilogue negotiations, which were expected
to begin on 16 October and to be finalised before the end of the
year. In view of this, he expresses the hope that we will now
be able to clear the draft Regulation.
Conclusion
1.13 We are grateful to the Minister for these
explanations, and are pleased to note his view that the discussions
within the Council have been satisfactory from the UK's point
of view, and that the one aspect of the proposal on Trusted Collections
giving rise to a concern over subsidiarity appears likely to be
resolved satisfactorily. Having said that, there do still appear
to be a number of uncertainties surrounding the position of the
European Parliament, and we have yet to receive the assessments
which the Minister's letter of 28 August said would be sent to
us. We would therefore like further information on these elements
before we would be in a position to clear either of these documents.
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