Biotech Companies COMPACTing their responsibilties

(2 pages)
September, 2012

Antje Lorch

ECO 43(3) published at MOP4 in Hyderabad, October 2012 -

In May 2008, on the eve of MOP4 in Bonn, six major biotech companies suddenly presented their "Compact" in an effort to undermine the then still ongoing negotiations about Liability and Redress. The Parties decided against it, continued negotiating and finally - at MOP5 in Nagoya - adopted the Nagoya-Kuala Lumpur Supplementary Protocol on Liability and Redress. Unfortunately that doesn't mean that we have seen the end of the Compact. Four years later and the same six companies (Monsanto, DuPont/Pioneer, Dow Agro Sciences, Syngenta, BASF and Bayer CropScience) together with the Global Industry Coalition (GCI) are still lobbying for it - but now they claim that they never wanted to stand in the way of the Supplementary Protocol, that they just want to provide countries with different options. The text of the Compact has been amended since its first version, but the basic issues are still the same as they were at their presentations four and two years ago.

Narrow definition of damage

The Compact does not in any way address traditional damage, i.e. damage to property, health and life, other than damage to biological diversity as defined in the Compact. From this, it follows that a major portion of potential damage, such as damage to farmers and their livelihoods and health, will not be covered. (see D. Currie 2010, ECO 34(2)) Only significant damage to biodiversity going to be covered. What does this mean? The Compact does not cover contamination, nor damages of which the Compact Tribunal assumes that they will heal by themselves; nor possible adverse effects addressed in the official risk assessment of the Competent Authority; nor on species for which solid baseline with all its natural variations has not been established (Compact, Art. 8). A claim will only be honoured if there is a “measurable, significant and adverse change in a species [...] or ecosystem that results in a loss of a natural resource service essential to sustain any species.” (Art 6)

Small chance to prove that damage has occurred

"In practice, the Compact would exclude virtually all eventual claims. Its unacceptably high standard of proof, its failure to properly incorporate the precautionary and ecosystem approaches, its heavy reliance on a baseline, and its list of exemptions, including risks which have been assessed, misuse of an LMO, and risks which have been authorised or permitted by States, as well as Act of God, means that it is extremely unlikely to yield any actual compensation except in the most extreme and narrow of circumstances." (Currie 2010) The required baseline means in practice that it becomes next to impossible to file a claim for an LMO that is already cultivated in a country, and the same companies are likely to object to countries postponing the approval of an LMO by a decade or so in order to establish a solid baseline. "The claimant must also prove that damage is exclusively caused by the LMO and does not fall in any expected or historical range of fluctuations. Any damage partly caused by an LMO, and partly by other factors, such as for example climate change or a natural disaster are by definition excluded.

Risk assessments block compensation

In order to protect their environment and to comply with the Cartagena Protocol, countries have to assess all possible risks. But if a country does so, it limits its options under the Compact because if any risk that was assessed beforehand turns eventually out cause damage to biological diversity, then this damage will be exempt from coverage under the Compact. This defence fundamentally undermines the objectives of the Protocol. Risk assessment is at the heart of the Protocol and is legally required by it (Currie 2010).

Giving up national sovereignty

If a country decides to use the Compact, the case will be handled by the Compact's Tribunal. At the same time the country forgoes the right to use other legal pathways and courts, and any right to pursue the issue in any other way on a national and international level. This does not only apply to the government level, but also reaches down to the level of access to justice for citizens. No country should sign its sovereign rights over to a private venture; no country should disband its own courts for a private venture in which the biotech industry is the defendant as well as the judge. All of these issues still stand 4 years after the Compact was introduced. Since then at least two more issue raise concerns.

No insurance company wants to insure GMOs

So far, no insurance company wants to insure the developers or users of LMOs. The Compact, so far, failed to get an insurance company on board - not even under the very narrow scope described above. The problem is unlikely to be solved in the future. Underwriting insurers do not like risks of unknown probability of occurrence and potentially high level of damage. The problem is not specific to the international level. It also occurs on a smaller scale: In Germany where the GMO laws include strict and shared civil liability of farmers growing GM crops, no insurance company could be found either.

Biotech industry “helps” to draft national laws

The Compact members have also taken it upon themselves to draft exemplary national laws in what they call an attempt to help countries implement the Supplementary Protocol. Unfortunately, they are being given a appearance of official legitimacy because they seem to supported in that by the co-chairs of the Supplementary Protocol negotiations, one of the co-chairs giving a presentation at the Compact's side event on Tuesday of the COP-MOP 6 week.

Ratify the Supplementary Protocol

The fight for liability has been a long one. During the Cartagena Protocol negotiations in 2000, many civil society observers and developing country delegates supported the “No liability, no Protocol” campaign. In 2008 Parties rejected attempts of the Compact to undermine the negotiations, and in 2010 the Supplementary Protocol was finally adopted. It is now up to the Parties to ratify the Supplementary Protocol and to establish national laws. “The big Six” of the biotech industry should not be allowed to write our laws and replace our courts. For articles from 2008 and 2010 see ECO 22(2) and 34(2);