Supreme Court rejects Monsanto plea on seed patent order

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The Supreme Court of India. Currently, trait fees on Bt cotton seeds are decided by a price control committee under the agriculture ministry.

New Delhi: The Supreme Court on Monday refused to stay a 2 May Delhi high court order which held that plant varieties and seeds cannot be patented under Indian law by companies like Monsanto Inc., and that royalties on genetically modified (GM) technology would be decided by a specialized agency of the agriculture ministry.

As a result, the patent held by Monsanto, through its Indian arm Mahyco-Monsanto Biotech Ltd (MMBL) over its Bollgard-II Bt cotton seed technology, a GM variant which resists the bollworm pest, was decreed to be unenforceable in India.

Monsanto’s appeal challenging the Delhi high court order was brought before a bench headed by Justice Rohinton F. Nariman who sought the response of seed companies over the issue.

“Instead of taking intellectual property rights under Protection of Plant Varieties and Farmers’ Rights Act, (PPVFR) Act, 2001, Monsanto took the patent route to exercise monopoly. They licensed this Bt cotton transgenic varieties to many Indian companies in the name of patent. This is held wrong by the high court. This will reduce royalties on seed prices and would give relief to farmers,” said Kalyan Goswami, director general of National Seed Association of India.

The division bench of the Delhi high court comprising justices Ravindra Bhat and Yogesh Khanna had permitted MMBL to approach the Protection of Plant Varieties and Farmers’ Rights Authority (PPVFRA) under the agriculture ministry for registering the variety within three months, following which the authority would have to decide on a benefit-sharing mechanism. Currently, trait fees on Bt cotton seeds are decided by a price control committee under the agriculture ministry.

The court also directed Monsanto to continue with its obligations under the sub-license agreements and allowed “the suit to proceed with respect to the claim for damages and other reliefs”, in the light of the sub-license termination notices issued by Monsanto.”

The court’s order came in a case filed in 2015 by Monsanto, through MMBL, against Nuziveedu Seeds and its subsidiaries for selling Bt cotton seeds using its patented technology despite termination of a licence agreement in November 2015. The order and the court’s interpretation of section 3(j) of the Patents Act, 1970, may prove to be an impediment for the entry of new technology in Indian agriculture as technology developers will lose pricing freedom.

The appeal will be heard next on 18 July.

(Sayantan Bera contributed to this story.)

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