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This article is more than 2 year old.

How PepsiCo exploited the law in its potato fight against Gujarat farmers

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PepsiCo India, which calls itself a snacking company, has initiated legal proceedings against four farmers in Gujarat for illegally using its potato variety registered under the Protection of Plant Varieties and Farmers’ Rights Act (PPVFRA). The case has given rise to a number of issues regarding the PPVFRA, arising from its contentious provisions and the manner of its implementation.

How PepsiCo exploited the law in its potato fight against Gujarat farmers
PepsiCo India, which calls itself a snacking company, has initiated legal proceedings against four farmers in Gujarat for illegally using its potato variety registered under the Protection of Plant Varieties and Farmers’ Rights Act (PPVFRA). The company applied for the registration of two hybrid potato varieties FL 1867 and FL 2027 in February 2011. These varieties were registered under the PPVFRA in February 2016 for a period of 15 years. PepsiCo marketed the latter variety under the trademark FC-5, and now is claiming that the Gujarat farmers are illegally using this variety.
The case has given rise to a number of issues regarding the PPVFRA, arising from its contentious provisions and the manner of its implementation. If these issues are not dealt with keeping the spirit of the law, and perhaps more importantly, their potential impact on the farming communities, the crisis facing Indian agriculture could only accentuate in the coming days.
The PPVFRA was enacted in 2001 after an engaging discussion in the country as to how to introduce intellectual property rights in agriculture after India joined the World Trade Organization in 1995 and agreed to implement the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS). The country had to choose between enacting a law protecting the interests of farmers and to adopt the framework given by the International Union for Protection of New Plant Varieties (better known by its French acronym, UPOV).
The latter option was rejected primarily because UPOV restricted the freedom of the farmers to re-use farm saved seeds and to exchange them with their neighbours. India enacted the PPVFRA that has a chapter on Farmers’ Rights, which among other things allows farmers to “save, use, sow, resow, exchange, share or sell his farm produce including seed of a variety protected under this Act in the same manner as he was entitled before the coming into force of this Act” (emphasis added).
What The Court Missed
PepsiCo’s lawsuit against the farmers raises a number of critical issues, which the court seems to have glossed over. The first issue is that production of the registered variety by farmers is per se not an offense since protected varieties can be re-used by farmers and shared with their neighbours in keeping with the provisions of Farmers’ Rights. The company has claimed before the Court that FC-5 was licensed to farmers “firstly in Punjab to bring potatoes of the said Variety on the buyback system”. The company has not made it clear where else FC-5 was available other than in Punjab.
The second issue is that FC-5 has been registered as an “Extant Variety”, which is also a “Variety of Common Knowledge”, in other words, this variety of potato was already available in the country before it was registered and that there was “common knowledge” about this variety. This implies that PepsiCo’s variety would surely have been produced in the country before it was registered. Further, from the order of the learned judge on 8th April 2019 in PepsiCo India Holdings Pvt. Ltd. versus Bipin Patel, it can be gleaned that the company may have given incorrect information that FC-5 is a “new” variety instead of an “extant” variety.
Registration of extant varieties was allowed in the PPVFRA despite opposition from several experts, and the justification used was that farmers’ varieties can be registered. The benefits that the farmers are deriving are not clear, but can easily be understood is that companies like PepsiCo that got the opportunity to register their older varieties, can now sue the farmers for using known plant varieties.
A third issue that arises relates to the modus operandi of PepsiCo to push the farmers to the brink. There are reports that the company employed a private intelligence agency to collect samples from the farmers’ fields. This reported surveillance was the exact copy of the infamous 1998 case, in which Monsanto raided the field of a Canadian farmer, Percy Schmeiser, and claimed that the latter was illegally using its genetically modified canola. Percy became the icon of the global resistance by farmers against commercial plant breeders, because of which Monsanto was not able to secure damages from him.
Second Thoughts?
It does appear that PepsiCo is already realising that it has crossed the Rubicon. The company has made an offer to the farmers to settle the dispute by entering into an agreement to purchase seeds from it and to then produce and sell on its terms and conditions. Whichever way this case may go, it has already become an example of how conglomerates like PepsiCo exploit the laws to realise their avaricious objectives at the expense of the marginalised.
Biswajit Dhar is a professor at the School of Social Sciences, Jawaharlal Nehru University.
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