Bridges Trade BioRes • Volume 6 • Number 2 • 3rd February 2006

US-Peru FTA Published, Controversy Ensues Over Biodiversity

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Controversy on the ramifications of the US-Peru Trade Promotion Agreement (TPA) signed on 7 December 2005 has ensued since the US government published the agreement and an understanding on biodiversity and traditional knowledge in early January (see Bridges Trade BioRes, 9 December 2005). In its intellectual property chapter, Peru committed itself, to ratifying the International Convention for the Protection of New Varieties of Plants (UPOV)-1991 by 2008. UPOV-1991 has been criticised for providing stronger protection for the rights of breeders of plant varieties than some feel is suitable for developing countries, for example by allowing seed saving only “within reasonable limits and subject to the safeguarding of the legitimate interests of the breeder”. In addition, the IP chapter calls for Peru to make “all reasonable efforts” to make patent protection available for plants - which they are not mandated to do under the WTO’s Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS) - and calls on them to allow methods of production to be patented, which could have implications for the patenting of biotechnology and processes. The agreement also includes a chapter on environmental issues, which allows one country to request that the others’ authorities investigate alleged violations of environmental laws and creates an environmental council. It also agrees that neither country can fail to effectively enforce its environmental laws in a way that adversely affects trade (reflecting US concerns that lax environmental enforcement in Peru could have give Peruvian producers a competitive advantage in trade) and sets up a dispute settlement procedure to enforce this. Finally, it emphasises the parties’ commitment to the conservation and sustainable use of biodiversity and preservation of traditional knowledge (TK).

The US and Peru also agreed during the same negotiations to an Understanding on biodiversity and traditional knowledge that recognises the importance of prior informed consent as the mechanism under which genetic resources should be accessed; equitable sharing of benefits derived from access to traditional knowledge and genetic resources; and appropriate examinations to ensure the quality and validity of patents granted on inventions regarding biodiversity or TK. In the understanding both Parties agree that contracts can adequately address concerns regarding access to genetic resources or traditional knowledge, as well as the equitable sharing of benefits that may result from their use. Critics, including some actors in the Peruvian government, argue that these provisions do not effectively tackle concerns over misappropriation of biodiversity and TK or ‘biopiracy’. Instead, they say that requiring disclosure of origin in patent applications is necessary, as several developing countries argued for at the WTO Hong Kong Ministerial Conference and at the CBD Access and Benefit Sharing talks this week in Spain (see related story, this issue). However, other prominent experts in Peru argued that the very fact that the US has accepted and agreed to the inclusion of comments on biodiversity and traditional knowledge in a TPA is already an achievement, particularly given that the US has never ratified the CBD.

Additional Resources

The US-Peru FTA is available at http://www.ustr.gov/Trade_Agreements/Bilateral/Peru_TPA/Final_Texts/Section_Index.html

See the upcoming issue of Bridges Monthly for a commentary on the biodiversity side-letter at http://www.ictsd.org/monthly/index.htm

ICTSD Reporting.