Comments on Draft EU Regulation

As the proposal recognizes, genetic resources play a significant and growing role in many economic sectors and involve a broad range of players, including but not limited to industry. Each sector may access, use and create value from resources covered by the CBD in different ways.

To translate raw genetic resources into commercially viable products that can contribute to economic growth and consumer choice, business actors engage in lengthy research and development processes that require significant investments with uncertain outcomes.

Businesses are only able to undertake such investments if the regulatory framework is clear and provides legal certainty, and if operating and transaction costs are proportionate to the commercial potential. Administrative requirements should therefore not be overly burdensome or costly, and should be easily implemented in normal business operations.

Positive elements of the EU proposal

ICC believes that the approach taken by the draft Regulation is generally helpful in meeting the above criteria, subject to clarifications on certain points. We support in particular the following elements:

• Non-retroactive application of the Regulation: It is extremely important for legal certainty that that the Regulation applies prospectively, and not retroactively. ICC therefore greatly welcomes the clear position that the Regulation applies only to genetic resources that are acquired after the entry into force of the Protocol in the European Union.
• Due diligence based on best practices: ICC supports the approach taken in the draft EU Regulation to establish a system of due diligence based on approved best practices as this provides a framework which helps ensure that users respect rules on ABS while providing them with flexibility to do this in the specific context of their different sectors.
• This flexible approach is an effective way to encourage compliance by business users as it will engage businesses in developing best practices to ensure implementation of ABS rules in their everyday operations. Any kind of rules need to be easily manageable and, preferably, based on existing regulations which can be fulfilled even by small and medium-sized enterprises without extra administrative workload in their day-to-day activities.
• Exclusion of genetic resources governed by specific international ABS instruments and in international territories: ICC welcomes the explicit exclusion from the Regulation of the genetic resources for which ABS is governed by a specialised international instrument to which the EU is a party, although it should be clarified that this exclusion relates to all plant genetic resources covered by the FAO International Treaty in relation to ABS. ICC also welcomes the implied exclusion of GRs in international territories.
• EU focal point: ICC finds the centralization of information on national competent authorities by the commission and the designation of a focal point at EU level very useful.
• Union trusted collections: ICC supports the concept of Union trusted collections in principle (see Article 5 below). The presumption that due diligence will have been exercised by a user if the user acquires a GR from a Union trusted collection will help provide legal certainty and lower the administrative burden.
• Exclusion of human genetic resources: The reference in paragraph 12 of the Preamble to the CBD decisions to reaffirm the exclusion of human genetic resources from the framework of the Convention is welcome.
• Traditional knowledge defined in MATs: ICC welcomes the approach that traditional knowledge referenced in the Regulation should be that defined in mutually agreed terms, given that there is no internationally agreed definition of traditional knowledge.

However, there are still several areas of the draft regulation which require clarification and may cause undesired effects.

Business users will make the efforts necessary to comply with the requirements of the final Regulation, but need to have clarity and legal certainty to be able to implement the provisions in practice.

Implementing regulations will play an important role in clarifying many of the points and making the Regulation operational. Business users look forward to working with the EU, member states institutions and other stakeholders in developing these.