Categories: Marine Article 3

Introduction

This paper seeks to address just one type of marine genetic resources (MGRs): the ones that are found “beyond national jurisdiction”, that is to say beyond 200 nautical miles from the baseline from which the breadth of the territorial sea is measured. Marine genetic resources in areas under national jurisdiction are regulated by national laws and by the international treaties ratified by the relevant States. MGRs that are beyond national jurisdiction, however, are not comprehensively regulated by any existing regime. For some years now, the international community has been discussing the legal status of those resources in several fora, but no agreement has been reached. Beyond the debate on legal definitions, countries are hiding a tendency to postpone the real issue: the regulation of the concrete management of these resources, their exploration and exploitation.

The utilisation of MGRs beyond national jurisdiction needs to be regulated within the framework of an international regime, in the widest sense of an international framework of management, that could be made up of soft law and voluntary measures at first, leading to more structured and legally binding measures. Until this new regime is established, existing regulatory and governance gaps should be overcome by coordinating the law of the sea and the biodiversity regimes, and by harmonising the biodiversity and the intellectual property rights (IPR) regimes. The complexity of this issue has its origin in the fact that MGRs beyond national jurisdiction partly fit within the framework of both the United Nations Convention on the Law of the Sea (UNCLOS) and the Convention on Biological Diversity (CBD), but neither of these regimes prescribes specific rules governing their exploration and exploitation. The apparent inconsistencies between the regime of biodiversity conservation and international IPRs further complicate the issue.

Marine Genetic Resources and Bioprospecting: Definitions

Genetic resources are defined as “genetic material of actual or potential value”, where genetic material is intended as “any material of plant, animal, microbial or other origin containing functional units of heredity” (Article 2 of the CBD). What gives genetic material the title of genetic resources is its potential value, which obviously could be of an economic nature, but could also be of purely scientific value. Genetic resources are the object of bioprospecting, for which there is no universally agreed definition, but which is “generally understood, among marine researchers, as the search for biological compounds of actual or potential value to various applications, in particular commercial applications”.

Bioprospecting of MGRs is already a major activity for the biotechnology industry: in 2005, global sales of marine biotechnology products were estimated at US$ 100 billion. The portion of the market attributable to MGRs collected in areas beyond national jurisdiction cannot be estimated, due to the absence of public information on origin and the fact that disclosure of origin is not required in international patent rules. It is probable that such utilization is marginal for now, but projections suggest its likely increase, as for example a 2007 statement by the UK biotechnology company Aquapharm. Bioprospecting uses biological resources for information. Once collected they can be kept and cultivated in laboratories, so it usually does not entail the gathering of huge quantities of resources. Therefore, the threat to biodiversity posed by bioprospecting activities is not in the direct depletion of the quantity of the resources; it is the environmental disturbance produced by the activities themselves, and the issue of equity. Up to now, no private entities are publicly known to have conducted bioprospecting activities in marine areas beyond national jurisdiction on their own. These activities are usually carried out by public research expeditions, usually with private sector investment and support, but with public sector staff and equipment.

Unregulated bioprospecting in areas beyond national jurisdiction, as it is carried out nowadays, raises concerns of equity. Given the lack of international rules for the exploitation of those resources, and the fact that only a few States have the financial, technical and human resources to undertake these activities in these areas, the core of the issue is one of equity between developed States and developing ones, and consequently one of sharing the benefits derived from the exploitation of those resources. On the one hand, support should be guaranteed to the huge investments that research in this field demands, while on the other hand, a just solution needs to be elaborated regarding the access to, and benefit sharing of, those resources.

The Convention on the Law of the Sea and the Convention on Biological Diversity: Incomplete Regimes

The two international regimes that are relevant to the management of MGRs are UNCLOS and the CBD. Neither of them specifically regulates the utilisation of MGRs in areas beyond national jurisdiction. Both are widely recognised: as of 1 November 2010, UNCLOS had 161 signatories, while the CBD had 168. UNCLOS divides the oceans into jurisdictional zones where the legislative and enforcement powers of the coastal State diminish according to the distance from the coast, to the point where the maritime zone is considered to be beyond the national jurisdiction of any State. (Each flag State does, of course, retain control over the ships flying its flag). Sixty percent of the oceans are beyond national jurisdiction. Specifically, the following areas are beyond national jurisdiction: the high seas (parts of the sea that are not included in the exclusive economic zone, in the territorial sea or in the internal waters of a State, or in the archipelagic waters of an archipelagic State) subject to the legal regime of the freedom of the high sea, and “the Area” (seabed and the ocean floor and subsoil thereof, beyond the limits of national continentalshelf jurisdiction). Regarding the seabed areas beyond national jurisdiction, their resources (“mineral resources” according to Article 133 of the UNCLOS) are governed by the “common heritage of mankind”.

Freedom of the high seas (a phrase commonly considered to mean the same as “ocean areas beyond national jurisdiction”) includes freedom of navigation, overflight, laying submarine cables and pipelines, constructing artificial islands, fishing and conducting marine scientific research (according to Article 87). This list was never intended to be exhaustive, therefore it could include the freedom to take samples of MGRs. These freedoms are to be exercised “with due regard for the interest of other States in their exercise of the freedom of the high seas” (Article 87.2) and with due regard for the obligation of the Convention concerning the activities in the Area and the protection of the environment of the Area (Articles 145, 194 and 209). These freedoms are not absolute, but are limited by the general obligation to protect the marine environment (Article 192) and especially “the rare or fragile ecosystems as well as the habitat of depleted, threatened or endangered species and other forms of marine life” (Article 194.5). On the high seas, control and enforcement are the responsibility of flag States, therefore every ship that carries out bioprospecting activities on the high seas is under the exclusive jurisdiction of its flag State. This situation provides an opportunity to ensure a responsible approach to human activities in hydrothermal vents, in coordination with the CBD obligation to regulate activities or processes carried out under its control in areas beyond national jurisdiction, and having effects on biodiversity (Article 4.b of the CBD), bioprospecting activities included, as we will see. But it also provides a loophole, since no State has adopted any specific legislation to regulate the use of MGRs on the high seas by its nationals,6 as an implementation measure for the abovementioned CBD obligation. Considering the enormous amount of public investment that bioprospecting needs, it is likely that States have chosen not to regulate these activities, in order not to discourage investment. However, investors can also be discouraged by legal uncertainty.

The Area and its resources are the common heritage of mankind, implying that no State shall claim, appropriate or exercise sovereignty over any part of the Area’s resources, and that all rights in its resources are vested in mankind, on whose behalf the International Seabed Authority (ISA) shall provide for the equitable sharing of financial and other economic benefits (Articles 137 and 140), and for their use exclusively for peaceful purposes (Article 141). There is no space here to demonstrate that the system of common heritage of mankind of the mineral resources of the Area is now a sui generis one, after the amendments brought by the 1994 Agreement Relating to the Implementation of Part XI of the United Nations Convention on the Law of the Sea. UNCLOS does not cover genetic resources at all: at the time of its negotiation, knowledge of hydrothermal vent biodiversity was very limited. The Convention only regulates the mineral resources of the deep seabed beyond national jurisdiction, the Area. This is the reason behind “the deepest of ironies”8 : that the exploitation of mineral resources, which is regulated in detail, does not seem to be feasible at the moment,9 while the exploitation of genetic resources, not regulated by the UNCLOS, is much more feasible and already on-going.

The status quo of the current exploitation of MGRs beyond national jurisdiction is the freedom of the high seas: This affirmation is supported by State practice (20 years of taking samples of MGRs in areas beyond national jurisdiction that has never been questioned as unlawful in the framework of the diplomatic debate) and by most other stakeholders too. Considering that State practice is one of the two elements constituting custom, “it may be unwise to allow the status quo to develop into customary law”, according to Glowka. One of the leitmotivs of the international law of the sea is the erosion of the freedom of the high seas, because of the development of new technologies and the rise in new needs regarding the management of resources. The freedom of the high seas can be seen as a starting point on which to build the regime for the management of MGRs beyond national jurisdiction, in order for the regime to grant free access to the resources, where free access does not mean unregulated as it is nowadays. We need to keep in mind that it is not an absolute freedom, and that it has to be applied “with due regard” for the interests of other States and for many obligations contained in the Convention itself, concerning the protection of the marine environment and marine scientific research. Bioprospecting is considered to be “applied” research, due to its commercial implications, compared to “pure” research, which has no commercial purpose. Marine scientific research is not defined by UNCLOS due to disagreements during the negotiation phase. On the other hand, Article 246 gave rise to a still debated distinction between pure research carried out “in order to increase scientific knowledge of the marine environment for the benefit of all mankind” (to which, in normal circumstances, coastal States give consent to other States in their exclusive economic zone); and applied research which “is of direct significance for the exploration and exploitation of natural resources, whether living or non-living”. Being aware of the difficulties in explaining what exactly makes a research pure or applied, what really matter are the economic implications of this distinction: the obligation of making results public in the first case and the possibility of keeping them secret in the second case, with the consequent possibility of getting IPR protection in the latter case. This is a very complex issue that needs to be clarified by the international community, especially considering that bioprospecting activities are already being carried out.

The huge debate on this issue seems not to consider that this distinction is based on a single comma in one article that deals only with one single marine zone, the exclusive economic zone. Therefore arguably this distinction is not applicable to other areas, neither to the high seas nor to the Area, the two areas beyond national jurisdiction, foci of the present paper. The distinction is based on the intention of the researcher: if he or she intends to conduct pure research, he/she has to make the results public, in order to prevent any IPR protection, through granting that the eventual “invention” does not meet one of the three requirements for being patented: the novelty requirement (Article 27.1 of the TRIPS Agreement; Article 3, EU Directive 98/44/ CE, 6 July 1998).

The result of this complex legal analysis is that bioprospecting is a sub-category, and not a different category, of marine scientific research; therefore it is subject to all the norms contained in Part XIII of the UNCLOS, dedicated to marine scientific research. Therefore, it has to be conducted exclusively for peaceful purposes, it shall not unjustifiably interfere with other legitimate uses of the sea, and it shall be conducted in compliance with all relevant regulations adopted included those for the protection and preservation of the marine environment. It shall not constitute the legal basis for any claim to any part of the marine environment or its resources (Article 241 of the UNCLOS), and it is subject to the obligation of publication and dissemination of information and knowledge of Article 244. Moreover, Article 143, regulating marine scientific research in the Area, states that it has to be carried out for the “benefit of mankind as a whole”; and paragraphs 1 and 3 at least of Article 143 are not limited to research on mineral resources, but comprise also research on natural resources and genetic resources too. Therefore, the ISA and States are under an obligation to “disseminate the results of such research”. These articles are important as a legal basis to contradict the freedom of taking samples of genetic resources in areas beyond national jurisdiction, and also to limit the application of IPRs over “inventions” on genetic material coming from areas beyond national jurisdiction, or at least to articulate a mechanism that guarantees that IPRs do not run counter to these objectives. Therefore there is a need to harmonise the regimes of the law of the sea and biodiversity conservation, and that of international IPRs.

According to UNCLOS Article 193, “States have the sovereign right to exploit their natural resources pursuant to their environmental policies and in accordance with their duty to protect and preserve the marine environment”, which is prescribed in Article 192 for the whole ocean, including areas beyond national jurisdiction. Moreover, Article 197 prescribes that “States shall cooperate on a global basis and, as appropriate, on a regional basis, directly or through competent international organizations, in formulating and elaborating international rules, standards and recommended practices and procedures consistent with this Convention, for the protection and preservation of the marine environment, taking into account characteristic regional features”. On the high seas, the protection of the marine environment is a flag State issue. According to Article 117, “[a]ll States have the duty to take or to cooperate with other States in taking such measures for their respective nationals as may be necessary for the conservation of … living resources”.

In May 2010, ISA adopted the Regulations on prospecting and exploration for polymetallic sulphides, and it is working on a draft for cobalt-rich ferromanganese crusts for adoption in 2011. Even though no exploitation of mineral resources in the Area has started yet, since 2001 eight contractors have signed exploration contracts for polymetallic nodules with the Authority but they are still in the exploration phase. The ISA, however, underlined in 2009 that all the recommendations (environmental considerations and data collection, see above) issued by the Legal and Technical Commission had been respected by all the contractors. Considering the strong interrelation between many minerals of the seabed and the genetic resources (many genetic resources are physically living on minerals) the competence of the ISA in the protection of the marine environment, however limited it may be, is fundamental for the preservation of the fragile ecosystems surrounding hydrothermal vents. One very important tool in the hand of the Authority is the possibility for its Council to forbid prospecting, exploration and exploitation activities of mineral resources in areas where “substantial evidence indicates risks of serious harm to the marine environment”. On the other hand, it is a sort of paradox that the genetic resources of the Area are protected from harmful effects that might arise from mining activities (none of which are yet in place), while they are not protected from the same effects arising from MGRs (bioprospecting and deep-sea tourism). This threat could be overcome if every State undertaking bioprospecting regulated this activity when carried out by its own nationals in areas beyond national jurisdiction, as required by the CBD.

The objectives of the CBD are “the conservation of biological diversity, the sustainable use of its components and the fair and equitable sharing of the benefits arising out of the utilization of genetic resources, including...by appropriate transfer of technologies, taking into account all rights over those resources and to technologies” (Article 1 of the CBD). The CBD’s scope of application covers “components of biological diversity, in areas within the limits of national jurisdiction” and “processes and activities, regardless of where their effects occur, carried out under [each Contracting Party’s] jurisdiction or control, within the area of its national jurisdiction or beyond the limits of national jurisdiction” (Article 4). Therefore it certainly applies to bioprospecting when conducted by individuals or companies under the control of a State Party to the Convention. The fact that no State has yet adopted legislation to manage these activities does not imply that they are not covered by the CBD scope of application. States are generally under an obligation to “develop national strategies, plans of programmes for the conservation and sustainable use of biological diversity (in accordance with its particular conditions and capabilities)” (Article 6 of the CBD). Unfortunately, up to now there has been no analysis of how existing national measures regulate MGR activities or processes conducted in areas beyond national jurisdiction. Beyond national jurisdiction, the CBD imposes on Contracting Parties the obligation “as far as possible and as appropriate, to cooperate with other Contracting Parties, directly or, where appropriate, through competent international organizations in respect of areas beyond national jurisdiction and on other matters of mutual interest, for the conservation and sustainable use of biological diversity” (Article 5). This obligation to cooperate has never been discussed by the Conference of the Parties, which has also not established any cooperation mechanism.20 Considering UNCLOS also includes the obligation to cooperate, a valuable coordination mechanism could be created, made up of bodies belonging to the framework of the CBD, and those belonging to UNCLOS, in regard to areas beyond national jurisdiction. Representatives from the Secretariat of the CBD should be required to participate in, and not only attend as observers at, relevant meetings of the law of the sea system and vice versa.

Regulations of IPRs Related to Genetic Resources

The international IPR regime is also important and relevant to the exploitation of MGRs beyond national jurisdiction. According to international and regional legislation, genetic resources are patentable regardless of where the resources are taken. Therefore MGRs beyond national jurisdiction are patentable themselves: it is quite difficult to estimate the exact amount of patents already granted to MGRs beyond national jurisdiction, since there is no obligation of disclosure of the origin of the resources, but according to a study undertaken in 2007, at least 37 patents have been released for MGRs taken in areas beyond national jurisdiction. International norms on IPRs only aim at giving a minimum of uniformity to national legislation. Granting a patent remains a national act. With regard to genetic resources taken from areas beyond national jurisdiction, the basic problem remains the same: how to balance the CBD obligation of prior informed consent and benefit sharing with the provisions of the Agreement on Traderelated Aspects of Intellectual Property Rights (TRIPs Agreement). The TRIPs Agreement includes the possibility to grant patents for any resource or product regardless of the provenance of it. In areas beyond national jurisdiction there is no issue of sovereignty, no need for consent to be granted and no binding rules on benefit sharing. The issue here is the harmonisation of IPR rules and the rules governing marine scientific research that are applicable to bioprospecting, that it be made public and be undertaken for the benefit of mankind in the Area. Moreover, as biodiversity is a common concern of mankind, biotechnology can also be considered a common concern of mankind for its important implications related to public health and food security.26 This raises an issue of equity that requires the management of MGRs beyond national jurisdiction to be articulated along a mechanism that, on the one hand, grants the biotechnology industry the possibility of recovering part of the initial investments through the payment of IPR royalties, and on the other hand assures that IPRs work for the benefit of mankind. This could be achieved by imposing, when the resources are patented, a payment of part of the royalties to an international fund which is responsible for benefit sharing, much like the Multilateral System of the FAO Treaty on Plant Genetic Resources. We are far from reaching such an advanced agreement on this critical issue therefore, in the meantime, we need to accommodate regime complications through various cooperation and harmonisation measures.

There are many incompatibilities between the CBD and the TRIPs Agreement, most of which go beyond the scope of the present paper, since they mostly deal with the management of genetic resources in areas under national sovereignty. The following paragraphs briefly underline the manner in which the two regimes offer important safeguard provisions that are adaptable to harmonisation and cooperation measures to be undertaken until a governance regime is in place covering MGRs beyond national jurisdiction. The TRIPs Agreement recognises the importance of transfer of technologies to developing States (preamble and Article 7), while on the other hand the CBD affirms as a matter of principle that IPRs are to be guaranteed effectively even in the case of transfer of technology (Article 16.2), without proposing a practical solution to this evident incompatibility. Other articles (Articles 8.1 and 27.2) represent opening clauses towards global fundamental needs, among them public order and environmental protection. Equity between developed States undertaking bioprospecting in areas beyond national jurisdiction and developing States lacking the means to do it, could be seen as a public order issue; and the disturbance of hydrothermal vents by bioprospecting could be the basis for an environmental exception to patents, following the precautionary principle. Moreover, the Doha Declaration could be interpreted as a valuable precedent for exceptions to IPRs for fundamental needs such as the protection of the marine environment and the necessity for a practical solution to the principle of the common concern of mankind for biodiversity. Finally, the debate within the framework of the World Trade Organization on the proposal to impose a binding disclosure of the origin of the resource and process to be patented is another important issue to be monitored in the future.

Notwithstanding the fact that some of the abovementioned safeguard provisions risk being only empty words, with more political than practical significance, these rules support the theory that the IPR and environmental regimes could work in an atmosphere of mutual support rather than incompatibility. This complexity of regimes can be resolved through practical implementation of the safeguard provisions offered by the regimes themselves. One practical solution to the incompatibility between IPR rules and transfer of technologies as part of benefit sharing, is represented by the FAO Treaty on Plant Genetic Resources, to which the European Union is looking as a model on which to draft the “regime” for MGRs beyond national jurisdiction.

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