India: Office Memorandum From Ministry Of Environment, Forest And Climate Change: A Much Needed Respite For The Bioscience Researchers And Companies

Last Updated: 16 October 2018
Article by Mita Sheikh and Pratistha Sinha
Most Read Contributor in India, January 2019

Biological diversity and ecosystem have always been global concerns, due to which various countries including India signed and ratified Convention on Biological Diversity (CBD). In order to meet the obligation under the said convention and furthermore to conserve the biological diversity as well as to provide mechanism for its sustainable use and equitable sharing of benefits arising out of the use of biological resources and knowledge, the Government of India introduced The Biological Diversity Act, 2002. The Act focuses on conservation of biodiversity, sustainable use of bio-resource and access and benefit sharing from the utilization of biological resources through a body called National Biodiversity Authority (NBA).

The Act regulates access to biological resources in diverse scenarios through its various provisions. Utilization of Indian biological resource or associated knowledge not only for commercial utilization but even for research, bio-utilization or bio-survey by non-resident Indians, foreigners, foreign companies, or Indian corporate with non-Indian participation is barred without prior approval of the NBA as per Section 3 of the Act. Even licensing of any research relating to biological resource from India to a foreigner, foreign companies, Indian corporate with non-Indian participation, or non-resident Indians can only be done after taking prior approval from the NBA under provision of Section 4 of the Act. Considering a wide scope of Intellectual Property, possibly with the intent of curbing bio piracy though this channel the Act under Section 6 also mandates a prior approval of National Biodiversity Authority for making an Application for IPR involving research on biological resource from India. Such approvals impose benefit sharing fee or royalty or both or impose conditions including the sharing of financial benefits arising out of the commercial utilization of such rights.

Awareness of such a statute however, is unfortunately not prevalent among much large section of public, which makes it one of the major factors of non-compliance of provisions mandated by this statute even if they are desirous of complying with the same. The Central Government has issued a notification on September 10, 2018, under section 48 of the Biological Diversity Act, 2002 to provide an opportunity to all such entities which required prior approval in past as per Sections 3, 4 and 6 of the Act and regulate these provisions in a manner that enhances implementation of the Act. This directive is not only in line with the objectives of the Act but enhances proper implementation of the Act, being one of the few targets the Government of India has set to achieve by 2020, (read here).

NOTICE F. N. C.- 12025/8/15-CS-III dated 10th September' 2018

The Central government has taken note of all the provisions of the Act and by exercising powers under section 48 of the Act, has issued Office Memorandum (OM) directing the National Biodiversity Authority to hear all such cases where prior approval of NBA was required (including the cases which needs prior approval of NBA in IPR related applications such as Patent registration application based on research based biological resource of India but the person/entity has not obtained such approval.

It is required that the authority should hear such cases on the merits and take decision within a period of 100 days from the date of issuance of this Office Memorandum (OM). The NBA can pass appropriate orders in furtherance of the powers available to it under section 18 of the act for facilitating and enhancing implementation of the act in public interest toward meeting the objectives of the act such as conservation of biological diversity, sustainable use of its components and fair and equitable sharing of the benefits arising from use of biological resource. Also, the NBA is required to abide by the principles of natural justice and various judgments of Hon'ble courts while implementing the directions.

As per the OM, the National Biodiversity Authority shall also look into the judgment as well as intent and reasoning behind such ruling pronounced by various Honorable Courts in order to decide such case in an unambiguous and clear manner.

In one incident, The Ministry had issued a notification in respect of prior environmental clearance under the Environment Protection Act, 1986 wherein six months period was provided to apply for environmental clearance for projects on which the project proponent has started work on site, expanded the production beyond the limit of environmental clearance. The High court of Madras had vacated the stay on the notification in the matter of Puducherry Environment Protection Association v. Union of India saying that the protection of environment and prevention of environmental pollution and degradation are non-negotiable. One time relaxation is not impermissible in cases where projects are in compliance or can be made to comply with the pollution norms.

Similarly, with respect to requirement of prior forest clearance from Central government, the Hon'ble Supreme court in SC Monitoring Committee v. Massoorie Dehradun Development Authority held that it is required to forward the case to the central government for seeking ex-post facto approval. With respect to situations where fait accompli situation arose, SC in T.N Godavarman Thirumulpad v. Union of India did not interfere with the decision of MoEF granting site clearance. The court held that since fait accompli situation arose, there was no option but to recommend the case for grant of permission for the use of forest land for mining lease, conveyor belt system and associated activities. The Bombay HC in Vijay Krishna kumbhar v. The State of Maharashtra held that in situation where fait accompli arose, there is no alternative except to follow the action which has become fait accompli and take further actions in accordance with the government's directions.

IP AND BIODIVERSITY

It is very clear from the above that the objective of the statute majorly is to provide equitable sharing of benefits arising out of the use of biological resources and knowledge and Section 6 of Biological Diversity Act mandates a prior approval from NBA before making an application for any intellectual property right in or outside India, for any invention based on any research or information on biological resources obtained from India. It is pertinent to mention that the aforesaid provision provides some relaxation to IPR application:

  • Provided that if a person applies for a patent, permission of the National Biodiversity Authority may be obtained after the acceptance of the patent but before the sealing of the patent by the patent authority concerned;and
  • Provided further that the National Biodiversity Authority shall dispose of the application for permission made to it within a period of ninety days from the date of receipt thereof.

The statute also provides for penalty against any violation of this particular provision, which leads to imprisonment which may extend to 5 years, or fine up to Rs.10 lakhs (approx. USD 15500) or damages with fine.

Such Authority (National Biodiversity Authority) is a Statutory body that performs facilitative, regulatory and advisory function for Government of India on issue of Conservation, sustainable use of biological resource and fair equitable sharing of benefits of use and is established to ensure that the essential provision of the statutes are being implemented.

The Biological Diversity Act, 2002 mentions that permission from NBA is to be obtained before the sealing of the patent. Thus, it is observed that there was no conformity to the timelines in grant of permission from NBA for patent applications which are based on research or information on a biological resource obtained from India. However, despite of a statutory time limit of ninety days being provided to the NBA for grant of such permission to patent applicants, NBA takes many years in issuance of such permission, which directly and adversely affects the patent right of the applicant. Such delay in permission means that in case an applicant complies with all the requirements for the grant of the patent, the patent shall be pending until the permission from NBA is granted.

Moreover, very few stakeholders are aware of this provision and therefore fail to comply with this provision. On account of this, the Central Government issued the OM dated 10.09.2018. This notification would not only help in spreading awareness among people about such compliances but will also be able to help expedite the whole procedure of grant of approval by providing a specific time line of 100 days. This, notification also regularizes the procedure of the approval by NBA providing much respite to those persons/entities for obtaining the requisite approval without facing the harsh penal action for unintentional failure to comply the Act merely because of not being fully aware of the provisions of the Act.

The question pertains to what has to be done by the Patent examiner in cases where patent application in relation to biological resource has been made, before the issuance of such notification?

According to the provisions of Patent Rules, 2015, the Controller may pass an appropriate order in case where the applicant has not submitted necessary permission from the competent authority within the period as prescribed under Rule 24B and 24C in order to receive grant under section 21 of Patent Act.

Rules 24B and 24C of the Patents Rules, 2003 mention that the time for putting an application in order for grant under Section 21 shall be four months from the date on which the first statement of examination is issued to the applicant to comply with the requirement extendable for a further period of 2 months. Thus, in case, NBA is unable to provide with such permission, by the time as prescribed under Rules 24B and 24C, the Controller has discretion to issue the "appropriate orders".

Since, the two statutes i.e. Patent Act, 1970 and The Biodiversity Act, 2002 are directed towards different subject matter, thus, they are independent of each other and neither is bound to follow directions of each other.

The Notification issued by the Central Government providing for a specific timeline of 100 days for approval of any application regarding IPR shall be step towards harmonizing the two procedures prescribed by the two statutes expediting grant of patent as well as implementation of the Biological Diversity Act.

The OM issued by the Ministry of Environment, Forest and Climate change thus is a huge and a productive step taken up by the Government, which will also lead to an expedited grant of patent as an allied benefit.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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