Bad Faith Plant Variety Rights Applications in China

FCI sat down with Baker McKenzie lawyers Andrew Sim and Alanna Rennie, who provided a Q&A on bad faith Plant Variety Rights (PVR) applications in China and countermeasures for plant breeders.

What are Bad Faith PVR applications?

Bad faith PVR applications are applications for PVRs in respect of a variety which the applicant did not breed (or has not received a valid assignment of the application rights). Bad faith applications will most likely be made using a different variety denomination to that of the original breeder’s.

Alanna Rennie.

Who owns the PVR right?

The first thing to understand is who owns the application right. In China, the general rule is that the application right belongs to the person who bred the variety, however, there are certain exceptions, including for example where the variety is bred in the course of employment or under an agency relationship. Once the PVR is granted, the right belongs to the applicant of that variety.

What happens when the PVP offices receive applications for the same variety?

A plant variety can only be granted with one PVR in China. Although the application right belongs to the person who bred the variety, the Plant Variety Protection (PVP) offices apply the first-to-file rule, and will grant the right to the person who first applied for the variety.

Only if the applications are made on the same day will the PVP offices consider who bred the variety first.

What should a breeder do in the face of a bad faith PVR application?

On a practical level, we suggest negotiating with the applicant to see whether you can have the application or grant assigned to you.

If there is no agreement, then you have two avenues:

  1. initiate action before the courts claiming that you are the breeder and the application is a “fake application”; or
  2. take action before the PVP offices on the basis that the prior application is not distinct. Note that the PVP offices only examine the registration criteria (i.e. novelty, distinctness, uniformity, stability and appropriate denomination) and apply the first-to-file rule, not who actually bred the variety.

Action before the PVP offices can be a good avenue if the breeder is in a position to prove that its variety is an existing variety of common knowledge and thereby not distinct. To do this the breeder would generally need a granted right abroad in respect of the variety or a publication of the variety description (PVR applications that have been publicly announced may also suffice depending on supplementary evidence).

If the breeder cannot prove that its variety is an existing variety of common knowledge then action may be better taken before the courts who will examine whether the applicant actually bred the variety and held the application rights.

How about bad faith plant variety registration and recordals?

Yes, this can be an issue in China. China’s plant variety registration and recordal system is similar to Europe’s Value for Cultivation and Use (VCU) system. It is a separate system from PVR which applies to a select list of crops, with the purpose of regulating the propagating material market, assessing varieties for value, disease resistance, regional suitability and other characteristics prior to commercialisation.

Bad faith registrations was the primary issue in the Limagrain case before the Gansu Higher People’s Court in 2018. In this case, Limagrain received PVR for its corn variety in China, however discovered that a third party had registered its variety using a different variety denomination under the registration system. This prevented Limagrain registering its variety due to the “one variety one name” principle and therefore prevented Limagrain from being able to commercialise its PVR protected variety in China. Ultimately, after hearing the evidence supplied by both parties, the Court held that the third party registration applicant was not the breeder of the variety and ordered the variety registration to be amended to reflect the variety’s correct name and breeder.

The take-away from this case is that bad faith variety registrations do exist, however they will not affect a validly granted PVR.

Do the PVP offices take any measures to prevent “fake applications”?

In the last two years MARA has established a large database of corn, rice, wheat and other varieties. Before carrying out DUS testing the office will search the database to see whether the applicant’s reference variety is correct, with one of the purposes being to avoid fake applications. NFGA is still in the process of establishing a database, however will search other databases for the same.

A number of additional safeguards are included in the draft amendments to China’s PVR regulations, released early last year, including:

  1. during the preliminary examination the PVP offices are to also examine whether the variety breeding process and parent source are true and reliable, this can be the basis to reject an application.
  2. the PVP offices are to establish a live library (garden) and information database of propagating material of varieties of common knowledge.

What are some good practices or preventative measures plant breeders can adopt to safeguard against bad faith PVR applications in China?

In order to be well-equipped to fight a bad faith PVR application, we suggest that breeders:

  1. keep a detailed record of breeding with dates that will allow you to easily prove that you bred the variety;
  2. maintain samples of propagating material of the applicant variety, its parents and its parent’s parents (this enabled Limagrain to prevail in its case against the bad faith variety registrant); and
  3. file an application for the variety as soon as possible and take advantage of any priority rights to avoid any applications getting in first under the first-to-file rule.

Are there any tools available for breeders to conduct due diligence?

The Ministry of Agriculture and Rural Affairs (MARA) responsible for agricultural PVR applications, has a public database of applications and grants. However variety descriptions and photographs are not provided which make it difficult to search varieties based on characteristics.

The National State Forestry and Grasslands Administration (NFGA) responsible for forestry PVR applications, publishes variety grants once a year which can be purchased. These show variety descriptions but contain no photographs.

Should your variety be listed as a variety subject to China’s variety registration or recordal system (highlighted above), an alternative is to search the variety registrations or recordals, which contain detailed descriptions of varieties conducive to conducting such due diligence.

 

BAKER MCKENZIE PUBLISHES FIRST-OF-ITS KIND GLOBAL PLANT VARIETY RIGHTS GUIDE

Plant breeders innovate and invest to bring new varieties to the world. There has never been a time when they have been more important. But with significant variations in plant variety rights (PVR) systems around the world, it is challenging to know how best to protect your investment everywhere that counts.

Baker McKenzie’s Global Plant Variety Rights Guide provides an easy way to get to know and compare different PVR systems around the world. It is the first of its kind, prepared by specialist lawyers from many of the company’s offices around the globe. The guide covers 18 key jurisdictions — from China to Peru, from the USA to Australia, and from the European Union to Japan — and much of the content is not readily available elsewhere in English.

For a deeper dive into global PVR systems, the substantive Guide provides the detail. Baker McKenzie have also prepared the Plant Variety Rights Summary so plant breeders and PVR holders can quickly check the basics by country.

Both the summary and the guide enable instant comparisons to be made between jurisdictions, reducing the time and uncertainty of PVR decision-making.

For more information contact:

Alanna Rennie – [email protected]

Sabrina Paner-Montiel – [email protected]

 

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