A limited breeders exemption

In September, the Netherlands welcomed a proposal for the introduction of a ‘limited breeders exemption’ into the patent law. The proposal concerns the modification of Article 53b of the Dutch Patent Act 1995.

Background

The increasingly important role of biotechnology led in 1998 to the adoption of Directive 98/44/EC on the legal protection of biotechnological inventions. As a result of this directive, biological material which possesses specific characteristics as a result of the claimed invention, is patentable. This also includes any identical biological material derived from that biological material through propagation or multiplication. In the Netherlands this directive has been implemented in the Dutch Patent Act 1995.

The entry of patent law into the plant breeding world has led to tension between the rights and interests of the patent holders and those of the breeders. This is because breeders want to use the plant material, which is protected by patent law, for further breeding, but can’t do that without the consent of the patent holder in the form of a licence.

Breeders exemption under Dutch law

Dutch plant breeding law contains exceptions to the exclusive rights of the breeder. One of these exceptions, set down in Article 57 clause 3c of the Dutch Seeds and Planting Material Act, is known as the ‘breeders exemption’. It is a limited exemption which gives breeders the right to use protected plant material for the purpose of breeding new varieties. The exemption is limited, because it does not extend to the commercial exploitation of the protected plant variety. For commercialisation a licence is required.

Research exemption in Dutch patent law

Dutch patent law has, until now, not contained a comparable clause. This means that breeders need a licence from the patent holder to use protected plant material for the purpose of further breeding.

“SINCE ACCESS TO PATENTED PLANT MATERIAL IS NECESSARY TO ENCOURAGE THE DEVELOPMENT OF NEW VARIETIES OF PLANTS FOR THE BENEFIT OF SOCIETY, THIS SITUATION IS CONSIDERED TO BE A PROBLEM.”

Dutch patent law does, however, contain a ‘research exemption’ in Article 53 clause 3 of the Dutch Patent Act 1995. This exemption gives breeders, exclusively for research purposes, free access to patented plant material, in order to do experiments on that material.

The exemption does not, however, extend to experiments with that material in order to breed new plant varieties. Since access to patented plant material is necessary to encourage the development of new varieties of plants for the benefit of society, this situation is considered to be a problem. In addition, this topic has also been discussed in other European countries such as France, Switzerland and German, where patent laws already contain a so-called ‘breeders exemption’.

Introduction of the breeders exemption into Dutch patent law

In order to solve the problem, different solutions have been examined by regulators in the Netherlands. One of these solutions is the introduction of a breeders exemption into Dutch patent law. This could be either broad or limited in extent—the broad exemption would also extend to the commercialisation of the patented plant material. But this option could conflict with Directive 98/44/EC and the TRIPS Agreement, and would leave the patentee empty-handed.

The second option, the one favoured for the change in the law, concerns the ‘limited breeders exemption’. This exemption extends only to the use of the patented material for the purpose of further breeding new varieties. To commercialise this plant material or the new variety incorporating the patented material, requires a licence. This option, therefore, benefits both the breeder and the patentee.

The proposal

It is proposed to add a new clause concerning the breeders exemption to Article 53b of the Dutch Patent Act 1995. This article concerns the exhaustion of patent rights and restricts the patentee’s exclusive right to the patented plant material with respect to the use of the plant material for the purpose of breeding new plant varieties by breeders.

The clause makes it possible for breeders to experiment with patented plant material. The breeder no longer requires a licence to do so, but this does not extend to commercial exploitation. For that a licence is still required, so that the new clause does not leave the patentee with a useless patent.