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Protecting rights related to desirable plant species is a delicate process, says Gabriel Di Blasi.
The agribusiness sector is one of the most developed in Brazil. The size of its territory and the natural resources available to help its development have contributed to this growth, as well as several factors including the resources devoted to research and innovation and the legal certainty afforded by the IP protection for innovation in Brazil.
One of the areas of agribusiness that stands out is the production of cellulose and specifically bleached eucalyptus pulp, which increased by approximately 5% between January last year and January this year. In January 2014, about 1.3 million tons of eucalyptus pulp were produced, with exports accounting for approximately 960,000 tons.
This was due to the quality and productivity of Brazil’s national eucalyptus forests, where the high quality of the eucalyptus clones is obtained through advancements in plant-breeding technology. The anatomical characteristics of the eucalyptus’s fibrous elements are affected by the morphological characteristics of the wood fibres, leading to an ideal paper-like effect. Additionally, innovations at the molecular level—that is the development of genetically-modified eucalyptus—are leading to an increase in productivity and a simultaneous reduction in costs.
Innovation in the industry is highly specialised and developed. But for it to occur, it is necessary for there to be both investment in it and a legal framework that ensures legal security for the resources. Depending on the type of innovation, one form of protection can be achieved through patent rights to the process of obtaining transgenic eucalyptus. Additional legal protection may be available for the biotechnological materials that may be present in a plant variety, such as gene constructs, vectors and cells containing such vectors; also by cultivar protection for the plant variety itself—for example, a new variety of genetically-improved eucalyptus.
It is noteworthy that for an object to be patentable, it must meet the requirements of patentability, namely novelty, inventiveness and industrial application.
With respect to the protection of eucalyptus cultivars, it is important to note that Brazil is a member of several international IP treaties, including the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), which allows right holders to choose the type of plant-variety protection and the country for protection, adopting the guidelines of the 1978 and 1991 versions of the International Convention for the Protection of New Varieties of Plants.
On April 25, 1997, the Brazilian government enacted the first legislation to ensure the rights of breeders of new plant varieties: Law No 9.456, regulated by Decree No 2,366 of November 5, 1997. The Brazilian government has therefore established a legal framework through the Plant Variety Protection Act, which recognises the rights of those involved in the genetic improvement of plant varieties in Brazil.
Protection for a new cultivar of eucalyptus can be achieved by the issuance of a Certificate of Plant Variety Protection (CPP) by the National Service for Plant Variety Protection (SNPC). This guarantees the holder the exclusive rights to its commercial reproduction in Brazil and prevents others from exploiting the propagating material of the eucalyptus for commercial purposes without authorisation during the period of protection.
The period of exclusivity to exploit the protected eucalyptus is 18 years from the date of grant of the protection certificate. Thereafter, the cultivar will fall into the public domain so others can then exploit it without infringing the rights of the breeder. According to Law No 9,456/97, an infringement of cultivar rights occurs when a third party sells, offers for sale, reproduces, imports, exports, packs or holds in stock for these purposes, or even aids in the spreading of, the material of the protected plant variety without the authorisation of the owner.
Furthermore, Law No 9,456/97 created the SNPC within the Ministry of Agriculture, Livestock and Supply (MAPA), which is responsible for the protection of plant varieties in Brazil. The protection of a eucalyptus variety in Brazil is achieved by fulfilling several requirements established by law at the SNPC.
"With regard to infringement actions, there is very little case law so there are many difficulties when these are taken."
To obtain protection for a cultivar in Brazil there need to be tests for distinctiveness, uniformity and stability, or DHE. These can determine differences from existing kinds of eucalyptus on the date of the application for protection, uniformity among eucalyptus within the same generation, and maintenance of the characteristics through successive generations of eucalyptus.
The SNPC defines which descriptors will be used for each cultivar, which are subsequently used to verify whether a cultivar is really novel and superior when compared with existing varieties.
To check whether an existing eucalyptus cultivar has been violated, the SNPC recommends the use of molecular markers through DNA testing, which can be used without performing morphological testing as the molecular marker has a confidence level of 99.99999%. Aside from the accuracy of the method, recognised worldwide, the time to obtain the result is another extremely important factor: collecting the material, obtaining the results and preparing the report can be achieved in just a few weeks.
However, if testing using morphological markers for infringement of a eucalyptus cultivar is necessary, the testing must analyse the similarities between the morphological markers of the eucalyptus registered at the SNPC and the samples collected in order to demonstrate that the protected eucalyptus and the potential violator have the same characteristics.
It is advisable to register all morphological and molecular markers of the new cultivar of eucalyptus at the SNPC to ensure its protection. When there is any infringement of a cultivar, a court expert will be called upon to analyse all the data submitted to the SNPC relating to the protected cultivar for comparison with samples collected from the potential clone infringer.
With regard to infringement actions, there is very little case law so there are many difficulties when these are taken. Only a small number of laboratories and technically-qualified staff can perform morphological and molecular tests, and it may be difficult to enter the planting sites of the potential offenders to prove a violation of a cultivar. There is also the question of how to quantify the loss and damage arising from the infringement, and all these factors must be taken into account when considering the best legal strategy and how to bring the most appropriate legal action.
When choosing a technical laboratory to perform DNA tests on eucalyptus for cultivate infringement, it is important that it should have access to databases of the molecular markers used in forensic genetic analysis, which are used by several public and private institutions in Brazil. Furthermore, the court expert must have the technical knowledge and experience needed to interpret the tests performed by the laboratory and prepare the expert report based on the tests.
According to Professor Dr Celso Luis Marino, coordinator of the Center for Genomic Analysis in the Department of Genetics at the University of São Paulo, morphological markers were valuable for the development of studies and breeding. However, given the limited data and the variation of morphological markers due to climate and other factors, scientists have started researching uniform markers that can be used in examinations anywhere in the world without such limitations.
In May 2013, Fibria Celulose, the largest pulp producer in the world, initiated an action against Eldorado Celulose Brasil, which was suspected of infringing its cultivar eucalyptus VT02. Fibria asked the court to order Eldorado to produce samples to be tested to verify its suspicions. This lawsuit is in progress at the 4th Civil Court of Três Lagoas, a municipality in Mato Grosso do Sul, Brazil. At the time of writing, the technical report that includes DNA testing confirms that at the six Eldorado farms where there was suspected misuse of the protected plant variety, five samples of the six provided were 99.99999981% genetically identical to Fibria’s VT02 cultivate, and this has been submitted to the court.
However, Eldorado has appealed to the Court of Justice of the State of Mato Grosso do Sul, challenging the conclusion of the technical report. The outcome of this lawsuit will confirm whether or not Eldorado has misused clone VT02 on its farms and the action is already being considered as a landmark case on the alleged misuse of cultivars.
Even though there are still some obstacles to legal cases in Brazil on the infringements of cultivar rights, innovation in the industry and competition among companies is increasing, as is the number of protection certificates being issued by the SNPC. All this will ultimately contribute to make this legal issue becoming specially known to the Brazilian courts. Therefore, the scenario is very favourable not only for cultivar rights, but also for the development of agribusiness in Brazil and the production of cellulose.
Gabriel Di Blasi is a partner at Di Blasi, Parente & Associados. He can be contacted at: firstname.lastname@example.org
agribusiness; eucalyptus; patents; TRIPS; SNPC