Proceedings of the Fifth Asian Regional Maize Workshop - Search ...

maize seed industries have become concentrated in the hands of a small number of companies,
but where the battle for market share is intense. It would be fair to say that maize
farmers in the USA and the EC are generally well served by the private seed industry, if
performance is measured by the availability of superior products at remunerative prices.
Although the high seed-to-grain price ratios prevailing in the USA and the EC do in part
reflect heavy promotion and advertising costs (which some might view as wasteful), the
fact that most farmers in these countries achieve extremely high yields means that the
cost of seed as a proportion of total purchased input costs is still very modest (about
10%).
Providing incentives for private sector investment may entail the enactment of IPR
laws. No effort will be made here to review comprehensively all of the IPR alternatives
available. However, it is worth distinguishing between two basic options:
1) plant varietal rights (PVRs): Many countries seem to be opting
for some form of PVRs, which help private companies establish proprietary
rights to the products they develop. Most forms of varietal registration
confer the right to produce and sell commercial seed of the protected
variety for a fixed number of years; researchers are usually allowed
to use protected materials as inputs into their own breeding programs
(although recent revisions of PVR laws in some countries will restrict
research uses). The emergence of DNA fingerprinting techniques will
facilitate definitive identification of materials, thus making more
practical the enforcement of PVR laws. However, a major problem is the
difficulty of devising an operational definition of what constitutes a
"significantly different" variety.
2) plant patenting: A few countries have granted patents on plant
varieties, conferring a much stronger claim to the patentee than PVRs
and often preventing the free use of the material by other researchers.
Since plant patents are often expensive to obtain, and since their
legality has not been established conclusively in many court systems,
patents have not been used extensively for maize germp1asm. Some of the
strongest opposition to plant patenting has come from critics who have
raised ethical objections to the idea of patenting living materials.
The need for legal protection of intellectual property generated by plant breeding
programs tends to vary as a function of the maturity of the seed market. In emerging
markets characterized by weak demand for seed and large numbers of relatively small seed
companies, demand for IPR tends to be modest, largely because small seed companies do not
invest extensively in R&D. The small seed companies typically found in emerging markets
tend to rely on germplasm obtained from public breeding programs, as well as on materials
"pirated" from other companies (a practice which is rarely admitted, but which is generally
recognized to be widespread). Because they do not invest heavily in R&D, small companies
naturally favor a system which affords the freest possible access to germplasm, and
they are usually content to protect their own products by preserving the confidentially of
parent 1ines. This so-called "trade secrets" strategy is feasible if the company is small
and careful vigilance of materials is practical. Arguments made by small seed companies
against enactment of IPR legislation are often couched in terms of "preserving biodiversity"
and "protecting farmers' rights," when in fact the companies' real interest is to
protect their ability to act as free riders in the system (i.e., those who profit from the
investment of others without contributing to R&D costs).
As seed markets mature and larger companies find it profitable to invest in R&D,
stronger IPR laws for plants may become necessary. It is difficult to generalize about the
stage of seed market development at which investment in R&D becomes an attractive option,
in part because the cost structure of research varies from country to country, and in part
because private seed industries are only now emerging in many developing countries (so
that there have not been many empirical examples upon Which to base conclusions). Another
key factor allUded to earlier is the prevailing policy environment regarding foreign
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