The European Regulation Proposal for plants derived from New Genomic Techniques (NGT): what challenges for seed companies and farmers?

Introduction

New genomic techniques (NGTs) offer revolutionary possibilities for plant modification, enabling more precise, rapid, and targeted genetic changes than traditional selection techniques. These innovations provide solutions for more resilient and sustainable agriculture, addressing global environmental challenges such as disease resistance or climate change adaptation. However, their rise raises significant legal, ethical, and economic questions.

The European Regulation proposal on NGTs, put forward by the European Commission in July 2023, marks a decisive turning point in the regulation of plant biotechnology in Europe. However, a major disagreement between the European Parliament, the European Commission, and the European Council complicates the adoption of this regulation, making it uncertain.

Definition and scope of NGTs

New genomic techniques (NGTs) refer to methods that allow for precise modification of the genome of plants, meaning their genetic organism. Unlike traditional selection techniques, NGTs enable targeted modifications to specific genes. Among these, CRISPR-Cas9 is the most well-known, allowing for precise cutting and modification of DNA segments. This technology paves the way for traits of interest, such as disease resistance or tolerance to extreme climatic conditions. This represents a significant advancement for agriculture and could transform plant production, offering more sustainable solutions in the face of environmental challenges.

The current legal framework: PVR and patents

The Plant Variety Rights (PVR) system

In Europe, seed companies benefit from legal protection through Plant Variety Rights (PVR). This system allows breeders of new varieties to protect their inventions, thereby guaranteeing their remuneration and encouraging innovation. However, an important exception exists: the “breeding exception,” which allows for the creation of new varieties using plants protected by a PVR. This enables seed companies to have some freedom in their innovation work without risking violating the rights of previous breeders.

Coexistence with patents

While in other regions of the world, such as the United States, entire varieties can be patented, Europe remains stricter. According to Article L611-10 of the French Intellectual Property Code, a patent can be granted for an invention that meets the following three conditions: novelty, inventive step, and industrial application. Thus, in France and Europe, patents apply only to specific traits or technical methods of improvement, not to entire varieties. For example, a seed company may have a PVR for a particular variety of tomato, but a patent could be filed for a specific gene that improves the resistance of this variety to a disease.

The impact of the New European Regulation on NGTs

Position of the European Parliament and the Council

The European regulation proposal on NGTs, put forward by the European Commission, finds itself in a politically tense situation. The European Parliament expresses major concerns, particularly about the patentability of plants derived from NGTs. It fears that the proliferation of patents on living elements could stifle innovation and increase costs for farmers. On the other hand, the European Commission and the European Council argue that certain genetic innovations derived from NGTs should be able to be protected by patents in addition to PVRs. This would ensure a return on investment for breeders while ensuring that genetic research can be monetized.

Implications for seed companies and farmers

If the Parliament’s position is adopted, the patentability of genetic traits derived from NGTs would be excluded, limiting seed companies’ ability to generate revenue from innovations brought by these techniques. This could reduce the incentive to invest in genetic research, with direct consequences on the cost of seeds for farmers. On the other hand, a hybrid system (which would include patents on certain traits) would complicate the market and could lead to an increase in seed costs, which farmers would then bear.

Concerns about the patentability of traits from NGTs

Debates on the patentability of traits and varieties

The proposed hybrid system could lead to a complex situation where each genetic trait derived from NGTs is protected by a separate patent. This would increase administrative costs for seed companies and complicate the legal landscape, with specific licenses needing to be negotiated for each trait used. This could stifle innovation, as a seed company might have to negotiate licenses for widely used genetic traits.

Economic implications for the seed market

Risks of increased costs for seed companies and farmers

If the patentability of traits derived from NGTs is allowed, seed companies would need to negotiate licenses to use these traits, leading to additional costs for farmers. These costs would be passed on to the price of seeds, making genetic innovation more expensive and limiting access to new technologies.

Implications for innovation and competition

The introduction of patents on genetic traits could have negative consequences by creating a market where access to innovations is restricted by exclusive licenses. This could reduce competition in the seed industry and limit farmers’ access to innovative seeds, with adverse effects on the efficiency and sustainability of agriculture.

The importance of administrative responsiveness in managing NGT and PVR rights

A recent case concerning the cancellation of the Community Plant Variety Right (CPVR) for the “Melrose” potato variety due to non-payment of annual fees illustrates the challenges of managing intellectual property rights in the seed sector. In the case Romagnoli Fratelli SpA v. Community Plant Variety Office (CPVO), the Court of Justice of the European Union (C-426/24 P) confirmed that the CPVO acted correctly in cancelling the right after several electronic reminders via the MyPVR platform to the holder, who failed to respond within the deadlines.

This situation highlights the importance for seed companies and plant breeders to strictly adhere to administrative procedures and closely monitor electronic communications related to their intellectual property rights.

In the context of NGTs, which bring rapid and complex changes to plant genetics, increased vigilance is necessary to avoid valuable rights being cancelled for administrative reasons, such as non-payment of fees or negligence in managing information.

In this context, just as with plant variety rights, it is essential for rights holders to ensure that their contact information and communication settings are up to date, and that they respond promptly to official notifications sent electronically. This is particularly relevant in the context of the proposed European regulation on NGTs, where complex administrative processes are likely to come into play, and where seed companies may find themselves in a similar situation if their rights are poorly managed or neglected.

Conclusion

The legal framework for NGTs is in the process of evolution, and the debates surrounding the proposed European regulation suggest significant changes for the seed industry. The compromise between patents and PVRs will be crucial for the future of innovation in this area, as well as for costs and competition in the seed market. If the system proposed by the Commission and the European Council is adopted, it could radically transform the sector, with significant consequences for seed companies, farmers, and the sustainability of European agriculture.

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FAQ

1. How does the PVR protect plant varieties?

The PVR protects plant varieties by granting their creator exclusive rights to production and commercialization. It allows seed companies to collect royalties from seed sales.

2. What are the issues surrounding the patentability of NGTs?

Patentability of NGTs could protect specific genetic traits but might also lead to market complexity with higher costs for seed companies and farmers.

3. Can NGTs be patented in Europe?

Currently, only technical methods or specific genetic traits derived from NGTs can be patented, not the entire variety.

4. How do seed companies negotiate licenses for genetic traits?

Seed companies negotiate licenses to use patented traits, which can lead to additional costs and complex intellectual property management.

5. What is the implication of the case of the cancellation of a plant variety right?

The case highlights the importance of maintaining compliance with seed protection rules, particularly concerning the payment of protection fees.