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IP and genetic resources in ABS agreements as "investments" and allow a very broadly defined "investor" to sue states for nonenforcement or inadequate enforcement of investor rights, no matter how resource constrained the developing countries parties may be (Correa, 2004).

IP and TK economics. Desegregated data on agricultural IP costs5 could help policy makers make more informed decisions about whether to assume the costs and legal obligations of specific patented agricultural products. The cost is difficult to justify in light of the aggregate 53% price drop in agricultural export commodities from 1997 to 2001 (FAO, 2005a), nor from the expected 2.8% price increase resulting from WTO Doha Round (Bou√ęt et al., 2004). In our assessment, the terms of trade rationale for investment in patented AKST becomes weaker still when taking into account the costs of state liability for non-enforcement of IP as "investment" in BITs and individual producer liability for violating patent holder rights, e.g., of agricultural biotechnology firms.

     There is no agreed methodology for estimating the economic value of traditional and local knowledge and genetic resources, for the purpose of licensing its use in specific patented products (Drahos, 2006). Agreement on such a methodology might be derived on the basis of experience with studies estimating the value of traditional knowledge and genetic resources used in specific patent products. A royalty or licensing fee system based on the value in the seed market is incorporated in national laws in some countries (e.g., the gene fund in India) and in the IT PGRFA that will be used to fund genetic resource conservation. Seed sales royalty funding therefore remains a policy option.6

     The global costs of withholding access to genetic resources due to national access regimes are insufficiently researched. Given the interdependence of countries on genetic resources (Flores-Palacios, 1997) and the fact that exchange of agricultural genetic resources among developing countries is much more frequent than transfer from South to North (Fowler et al., 2001), such costs are likely to be borne to a large extent by developing countries. Providing financing mechanisms to facilitate genetic resource access and transfer from agrobiodiverse rich developing countries

5 One estimate suggests that developing country TRIPs commitments in the Uruguay Round amounted to $60 billion annually in implementation costs, licensing fees and royalties (Finger, 2004). 6 As part of a project to measure genetic resource erosion and to suggest how royalties be paid to source countries of genetic resources might provide incentives for conservation, it was estimated that a 1% royalty on sales of patented seeds incorporating traditional knowledge and genetic resources would return about $150 million per annum to the source countries, most of them developing countries (FAO, 1998). However, with the creation of the Global Crop Diversity Trust in 2004, FAO's erstwhile interest in using royalties to pay for protection and enhancement of crop diversity has diminished. The Trust Fund has shifted away from FAO's prior dependence on annual donor government contributions towards funding Trust activities from an endowment supplemented by foundation grants. Nevertheless, the Trust states that there are many crop diversity conservation activities that it cannot and will not finance.

 

to agrobiodiverse poor developing countries is one option for remedying this situation.

Other policy options regarding intellectual property and traditional knowledge include:

  1. Insofar as traditional knowledge and genetic resources may form part of the prior art of a patented AKST product, adoption of a disclosure amendment in TRIPS could serve to enhance patent quality and might be a disincentive of misappropriation. Information so disclosed could be part of the legal basis for any licensing agreement on traditional knowledge and genetic resources used in a patented product. WTO members might also wish to consider adopting a weaker interim standard of TK protection, such as a Declaration on Trade and Traditional Knowledge (Gervais, 2005).
  2. Given the impasse at the WTO over disclosure, developing country members are seeking to protect traditional knowledge and genetic resources with strong norms in WIPO negotiations. However, in the absence of the capacity to enforce such norms, members could agree on the design of mechanisms for and the financing of an "enforcement pyramid" (Drahos, 2006) for any norms that are agreed, preferably under the coordination of a joint agency under CBD, FAO and WIPO. This could ensure that local and indigenous stewards of agrobiodiversity would participate in member government decisions on the licensing of traditional knowledge and genetic resources, as called for in Article 9 of the ITPGRFA.
  3. Both multilateral IP negotiations and implementation discussion lack ex ante and ex post economic analysis of the cost and benefits of adopting IP commitments and patented AKST. Analysis of, not rhetorical claims about, IP benefits for developing countries, could inform bilateral agreements and national government IP policy and legislation (Park and Lippoldt, 2004). Multilateral and technical assistance could include financing for IP economic analysis.
  4. A methodology for valuing the ex-post contribution of traditional knowledge and genetic resources in patented AKST option to agree, as a prerequisite for any agreement on how to license traditional knowledge and genetic resources in patented products. Decision makers may consider ex-post studies of traditional knowledge and genetic resources valuation in existing patented products to better delineate the elements for an agreed methodology.
  5. Facilitating access to and sustainable use of traditional knowledge and genetic resources among developing countries, particularly for the benefit of agrobiodiverse poor developing countries may be a an issue that policy makers may wish to move higher in the priorities of the multilateral AKST agenda, Both for food security and agroenvironmental sustainability reasons, it remains an option for policy makers to consider developing guidelines for a specific facility for the benefit of agrobiodiverse poor developing countries.

7.4.3 Effects of rights on AKST at the national and institutional levels

IPRs on products and processes that are relevant to agricultural development in the widest sense create novel con-