Bilateral vs. Multilateral? On the economics and politics of a global mechanism for genetic resource use

Abstract

Many industries benefit from public biodiversity conservation through the use of genetic resources in R&D processes. The conservation of biodiversity, though, is an under-provided public good. The aim of this paper is to analyze a global mechanism as a policy tool to internalize the positive conservation externalities accruing to commercial users of genetic resources. The United Nations ‘Convention on Biological Diversity’ (CBD) and its ‘Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilisation’ provide a framework for such mechanism. In light of economic arguments in favor of a global mechanism, we study official CBD documents and an online discussion forum launched by the Convention’s Secretariat on a global multilateral mechanism, as well as conduct expert interviews with important political stakeholders on genetic resource trade. We find that the economically preferable instrument of a comprehensive global mechanism is politically not feasible any time soon due to path dependencies and an arguably narrow understanding of national sovereignty. Technological progress in genetic resource use, though, might finally induce countries to establish a confined one in the mid-term future. We provide substantiated findings on countries’ preferences for its scope and modalities.

Keywords:

• environmental policy
• biodiversity conservation
• genetic resources
• positive externalities
• CBD
• benefit sharing

Acknowledgements

We are most grateful to all experts for providing information for this study. We wish to thank Lily Rodriguez and Elsa Cardona Santos for their support in conducting the interviews. We would like to thank an anonymous reviewer for helpful comments. Moreover, the first author is thankful for having received a grant from the scholarship foundation Bischöfliche Studienförderung Cusanuswerk.

Notes

1. Biodiversity ‘includes diversity within species, between species and of ecosystems’ (CBD, Art. 2).

2. Positive externalities are unremunerated benefits for third parties arising from someone’s action. For an introduction to the concept of externalities refer to, for example, Varian (2006, p. 626 ff.). In this paper we focus on a fraction of all positive externalities of biodiversity conservation – those from which genetic resource users such as pharmaceutical firms profit. The internalization of other positive conservation externalities as well as the internalization of negative externalities through land use, production, and consumption, are beyond the scope of this paper.

3. Both, genetic material and information are commercially used. Swanson (1996, p. 4) clarifies: ‘That is, industry can either take note of the explicit information and make use of that information to develop new products, incorporating that information without translocating the biological material, or industry can make actual use of the coded (genetic) material that produces that effect and transplant it to the desired purpose’.

4. UNEP/CBD/COP/DEC/X/2, Annex III.

5. United Nations (1992): Convention on Biological Diversity, 31 Int’l Leg. Mat. 818, Rio de Janeiro, 05.06.1992.

6. Firms using genetic material individually remunerate the use and the entire society pays an additional subsidy on resource use to internalize information spillovers. The user-pays-principle differs from the provider-gets-principle in that the instrument’s point of contact is the beneficiary of the positive externalities. In the context of the internalization of negative externalities, the user-pays-principle refers to the ‘indirect responsibilities of second order’ as an extension of the polluter-pays-principle (Cordier, Hecq, Hawi, & Pérez Agúndez, 2014, p. 1).

7. United Nations (2010). Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilization to the Convention on Biological Diversity, Nagoya, 29.10.2010.

8. The NP builds on the Bonn Guidelines (United Nations (2002). Bonn Guidelines on Access to Genetic Resources and Fair and Equitable Sharing of the Benefits Arising out of their Utilization. UNEP/CBD/COP/6/24).

9. This compromise was reached with the African Union in last-minute informal ministerial negotiations (Earth Negotiations Bulletin, Vol. 9, No. 544, p. 3).

10. UNEP/CBD/COP/DEC/X/1, Annex II, Section B, Item 10.

11. Among others, as information documents for meetings of the Ad-Hoc Open-Ended Working Group on Access and Benefit-Sharing in 2005 (Oldham, 2004), 2009 (Garrity et al., 2009), and 2010 (Schei & Tvedt, 2010; Singer, 2009; CGIAR, 2010), in the online discussion forum on Art. 10, NP, and as information document on synthetic biology in preparation of COP 12 (UNEP/CBD/COP/12/INF/12, para 172 ff, online: www.cbd.int/doc/meetings/cop/cop-12/information/cop-12-inf-12-en.pdf, last 24.10.2014).

12. Vogel (2013) suggests an explanation for the few discussions on genetic information by proposing a hypothesis of ‘unpersuasive power’ (p. 1).

13. FAO (2001). International Treaty on Plant Genetic Resources for Food and Agriculture, Resolution 3/2001, Rome, 3.11.2001.

14. Special attention will have to be given inter alia to the case of the United States of America

15. The online discussion (online: http://absch.cbd.int/Art10groups.shtml, last 10.01.2014.) served the purpose of the broad consultation on Art. 10 which was instructed by the COP 11 in decision XI/1 B (UNEP/CBD/COP/11/35, XI/1 B, p. 76). It uses the list of questions included in decision XI/1 (UNEP/CBD/COP/11/35, XI/1, Annex I, p. 79 f.).

16. UNEP/CBD/ABSEM-A10/1/2, para. 4, online: http://www.cbd.int/doc/meetings/abs/absem-a10-01/official/absem-a10-01-02-en.pdf, last 12.11.2013.

17. Bogner and Menz (2009a, p. 73) define an expert as a person who ‘possesses technical, process, and interpretation knowledge, which relates to a specific field of action, in which he acts in a relevant way (for instance in a specific organisational or his professional area of activity)’ [emphasis added to reflect the authors’ further elaboration].

18. The Science-Policy Workshop on Access and Benefit-Sharing for non-commercial academic re-search in LAC was facilitated by DIVERSITAS, the International Council for Science, the Swiss Academy of Sciences, the International Union of Biological Sciences, University of Bonn, and the International Union for Conservation of Nature.

19. Inter alia ABS national focal points in the government ministries.

20. The interview guideline can be provided by the authors upon request.

21. Prior to the interviews, Art. 10, NP, had already been debated during ICNP-2, as well as in the online discussion forum (www.cbd.int/doc/?meeting=icnp-02; http://absch.cbd.int/Art10groups.shtml, last accessed 03.01.2014).

22. UNEP/CBD/ICNP/2/7.

23. Earth Negotiations Bulletin, Vol. 09, No. 579.

24. Art. 11, NP, calls for cooperation between parties in case of in situ transboundary resources and traditional knowledge associated with genetic resources that is shared by communities living in more than one country.

25. UNEP/CBD/ICNP/3/5, Item 4.

26. UNEP/CBD/ICNP/3/L.8.

27. UNEP/CBD/NP/COP-MOP/1/L.9. The brackets around ‘subject to the availability of funds’ were removed from the ICNP-3 decision recommendation.

28. Ref., for example, to the interventions made in the online discussion forum.

29. A list of statements in favor of a GMBSM can be obtained from the authors upon request.

30. A list of statements against a GMBSM can be obtained from the authors upon request.

31. A list of situations that could fall under a GMBSM can be obtained from the authors upon request.

32. If not explicitly requested otherwise, we refer to all experts without their names and in the female gender to disguise their identity.

33. Six out of eight countries, one no information, one no high benefit expectations at the beginning.

34. Decisión 391 on a ‘Common Regime on Access to Genetic Resources’ (Comision del Acuerdo Cartagena (1996). Decisión 391: Régimen Común sobre Acceso a los Recursos Genéticos, Gaceta Oficial del Acuerdo de Cartagena, año XII, Numero 213, Lima, 17.06.1996.)

35. We are thankful to an anonymous reviewer for pointing out this inference.

36. UNEP/CBD/ICNP/3/5, Item 4.