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Thursday, 8 June 2006


Farmers' rights in the ECJ

The European Court of Justice gave its ruling this morning in Joined Cases C-7/05 to C-9/05, Saatgut-Treuhandverwaltungs GmbH v
Ulrich Deppe, Hanne-Rose Deppe, Thomas Deppe, Matthias Deppe, Christine Urban (née Deppe), Siegfried Hennings and Hartmut Lübbe
. This was a reference from the German Bundespatentgericht in 2004 for a preliminary ruling on Council Regulation 2100/94 of 27 July 1994 on Community plant variety rights. According to Article 14(1) of the basic regulation, which provides for a derogation from Community plant variety rights,

‘... farmers are authorised to use for propagating purposes in the field, on their own holding the product of the harvest which they have obtained by planting, on their own holding, propagating material of a variety other than a hybrid or synthetic variety, which is covered by a Community plant variety right.’
By Article 14(3), farmers (other than small farmers) must pay
'an equitable remuneration to the holder, which shall be sensibly lower than the amount charged for the licensed production of propagating material of the same variety in the same area; the actual level of this equitable remuneration may be subject to variation over time, taking into account the extent to which use will be made of the derogation ...’.
But what is remuneration which is 'sensibly lower'? The ECJ ruled as follows:
"1. Without prejudice to the assessment made by the national court of the other circumstances relevant to each of the main proceedings, a flat-rate remuneration of 80% of the amount charged for the licensed production of propagating material of the lowest category qualified for official certification, of the same variety in the same area, in the event of recourse to the agricultural exemption referred to in Article 14(3) .. does not satisfy the condition that remuneration has to be ‘sensibly lower’ than the amount charged for the licensed production of propagating material within the meaning of Article 5(2) of Commission Regulation 1768/95 [implementing rules on the agricultural exemption] ...

2. The criteria for determining the remuneration to be paid to the holder of a Community plant variety right are set out in Article 5(4) and (5) of Regulation 1768/95, as amended by Regulation 2605/98. Those criteria have no retroactive effect but they may serve as a guide for the calculation of that remuneration with respect to planting carried out before the entry into force of Regulation 2605/98.

3. In order for an agreement concluded between organisations of holders and of farmers, as referred to in Article 5(4) of Regulation 1768/95, as amended by Regulation 2605/98, to be used as a guideline as regards all its parameters, that agreement must have been notified to the Commission of the European Communities and published in the Official Bulletin of the Community Plant Variety Office and that is so even if it was concluded before the date on which Regulation 2605/98 entered into force. Such an agreement may provide for a rate of remuneration different from that laid down, in the alternative, in Article 5(5) of Regulation 1768/95 [as amended] ...

4. In the absence of an applicable agreement between organisations of holders and of farmers, the remuneration of a holder of a Community plant variety right has to be established, pursuant to Article 5(5) [as amended] ..., as a fixed amount which constitutes neither an upper limit nor a lower limit".
The IPKat, who (embarrassingly) does not feel qualified to pass any comment on this decision, invites comments from that small, select band of people who practise in this field. Merpel adds, you can get some good background reading on this issue from European Community Patent Protection, the book recently published by OUP and written by Gert Würtenberger and his friends (blogged here).


Anonymous said...

The possibility of small farmers in France and southwards understanding the law of plant breeders' rights are remote. Unless seed is sold with the genetic modification of a "terminator gene" they will save some of their seed a plant it the following year as they have done for centuries. It is unlikely that they will buy the specially developed seed in the first place but cross polination may improve their own stock resulting in court proceedings for infringement. This has already happened in Canada. I am not sure what modification is being made to oilseed rape but the effect of its pollen on my eyes becomes worse every year.

Tim Roberts said...

The essentials of the law of plant breeders' rights are not difficult to understand. If you buy protected seed, you can plant it and sell the crop. You mayn't sell the harvested seed for propagation, because that destroys the breeder's market. Any seed you have been planting for centuries, you can of course continue to do as you like with.

Can you replant your harvested seed on your own land (as you have been doing for centuries - but not with improved protected seed)? This is controversial - farmers see it as a 'farmer's right' but breeders say that this deprives them of essential sales of a low-margin product that typically takes 10 years to develop. The EU's political solution is that, in general, farmers must pay a royalty for using their 'farm-saved seed' but 'sensibly less' than the standard royalty. The ECJ case is about what 'sensibly less' means.

Small farmers (in France and southwards, or elsewhere in EU) don't have to pay any royalty on farm-saved seed. They buy protected seed where it offers good value. The 'terminator gene' is a wonderful poster-child for the anti-GM movement, but is not, to the best of my knowledge, actually on sale anywhere in the world yet, or close to it.

It is perfectly in order for farmers (or anyone else) to cross-pollinate protected seed with unprotected seed. They can do what they like with the product, because it is no longer the protected variety. The case in Canada dealt with a patented gene, which is a different case - though the grower there was remarkably unlucky, in that a large proportion of his crop, instead of self-pollinating, apparently picked up the protected gene from his neighbour's field.

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