Compliance obligations: genetic resources

Homburger’s Andri Hess details the Nagoya Ordinance.

Switzerland is a member of the United Nations Convention on Biological Diversity (CBD) and signed the Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilization on 11 May 2011. The Nagoya Protocol pursues the implementation of the fair and equitable sharing of benefits arising from the utilisation of genetic resources, which is the third of the three core objectives of the CBD. On 1 February 2016, the main parts of the Swiss implementing ordinance (Nagoya Ordinance) entered into force.

I. Implementation on statutory level

On a statutory level, Switzerland implemented the Nagoya Protocol by amendment of the Federal Act on the Protection of Nature and Cultural Heritage (Bundesgesetz über den Natur- und Heimatschutz (NHG)). On 12 October 2014, a new section 3c of the NHG was enacted. As part of this new section, article 23n introduced a due diligence requirement. Users of foreign genetic resources and of associated traditional knowledge, and those who directly benefit from such utilisation, are required to apply due diligence appropriate to the circumstances to ensure that the access to the genetic resources was lawful, and that mutually agreed terms on the fair and equitable sharing of benefits arising from their use have been negotiated. Access is considered lawful if it is in accordance with the law on access and benefit sharing (ABS) of that Nagoya Protocol contracting state that has provided the respective genetic resource or associated traditional knowledge. According to the Nagoya Protocol, a country is considered a ‘providing country’ if it is the country of origin of the respective genetic resource or if it has acquired that resource in accordance with the CBD. A country is the country of origin if it possesses the genetic resource in in-situ conditions.

‘Due diligence and notice requirements not only apply to foreign genetic resources but are extended to domestic resources.’
Andri Hess, Homburger

The amended NHG also defines a centralised checkpoint at the Federal Office for the Environment (Bundesamt für Umwelt) to which compliance with the due diligence requirement must be notified before marketing authorisation for products that have been developed using genetic resources is granted or, if a product does not require an authorisation, before such product is commercialised. Non-compliance with the notice requirement may be punished with a fine up to CHF100,000 in case of intent and up to CHF40,000 in case of negligence. The amended NHG further clarifies that the due diligence and notice requirements not only apply to foreign genetic resources but are extended to domestic resources, and it empowers the Swiss Federal Council (Bundesrat) to regulate access to domestic resources.

An important provision that was controversially debated in the legislative process is the transitional provision in article 25d NHG. It clarifies that the due diligence and notification requirements have no retroactive effect but only apply to the access to genetic resources or associated traditional knowledge that has taken place after the new section 3c of the NHG has come into force, ie after 12 October 2014. The transitional provision is understood as exempting from the due diligence and notification requirements genetic resources that were already available in Switzerland at this date.

II. The new Nagoya Ordinance

The Nagoya Ordinance (Verordnung über den Zugang zu genetischen Ressourcen und die ausgewogene und gerechte Aufteilung der sich aus ihrer Nutzung ergebenden Vorteile (Nagoya-Verordnung, NagV)) in its main parts entered into force on 1 February 2016. It specifies the due diligence and notification requirements, and provides a list of information that needs to be recorded, preserved and passed on to subsequent users. In particular, the scope of this last mentioned obligation will need to be further clarified, for example in cases where subsequent users use a genetic resource without the consent of the first user. As evidence for their compliance with the notification requirement, users are granted register numbers.

The Nagoya Ordinance further creates two publicly available registers. One register shall list processes of which users can be sure that by adhering to them they will be deemed compliant with the due diligence and notification requirements. The second register shall contain collections of genetic resources for which their respective proprietors warrant that they are well documented, that the access to the respective resources was lawful, and that agreements on ABS are in place where such arrangements are required.

The Nagoya Ordinance also addresses domestic genetic resources. While it does not subject domestic genetic resources to consent and benefit sharing requirements, it demands that users document the access to the respective genetic resource and its use, and that users provide the competent authorities with this information before marketing authorisation is granted or commercialisation begins. As is the case with foreign genetic resources, users are granted a register number upon compliance with the notification requirement. Unlike the rest of the Nagoya Ordinance, the provision on domestic genetic resources will only enter into force on 1 January 2017.

An annex to the Nagoya Ordinance lists all amendments to other federal statutes that entered into force with its enactment. For example, the Ordinance on Medicinal Products (Arzneimittelverordnung) was amended with new articles 3 paragraph 1 bis and 7 paragraph 1 bis, which state that a request for the grant of a marketing authorisation must contain the register number if the development of the medicinal product was based on genetic resources or traditional knowledge, and that the marketing authorisation will be granted only after evidence for compliance with the notification requirements has been provided.