ARTICLE: Legal and Policy Reforms to Strengthen the Enforcement of Biological Diversity and Benefit-Sharing Obligations under the Biological Diversity Act, 2002, AUTHOR: Md Sahidullaha
The Biological Diversity Act, 2002 (BDA) was enacted to give effect to India’s commitments under the Convention on Biological Diversity. It is based on three goals: conservation of biological diversity, sustainable use of its components, and fair and equitable sharing of the benefits derived from the use of biological resources. Twenty years later, the challenge of the Act is not its drafting, but how the Act is being enforced in the field.
ARTICLE
1. INTRODUCTION
The Biological Diversity Act, 2002 (BDA) was enacted to give effect to India’s commitments under the Convention on Biological Diversity. It is based on three goals: conservation of biological diversity, sustainable use of its components, and fair and equitable sharing of the benefits derived from the use of biological resources. Twenty years later, the challenge of the Act is not its drafting, but how the Act is being enforced in the field.
This article explores how enforcement of the Biological Diversity Act, 2002, in particular with respect to the benefit-sharing provisions, may be enhanced. In most parts of the country, Biodiversity Management Committees are still institutions of paper, lacking in resources, capacity and legal awareness.
The Biological Diversity Act of 2002 is not a run-down law. It is one of the most advanced biodiversity laws in the world. The challenge is actually the other one: the difference between the law on the books and the law in practice.
In this regard, the assignment first reviews the working of the benefit-sharing obligations in the Act and the reasons why they are not reaching the communities that conserve biodiversity. It then outlines the key enforcement lacunas and recommends six areas of reform in law and policy, each subject to pro and con arguments, with the assistance of judicial rulings, parliamentary debate and academic literature.
2. BENEFIT-SHARING OBLIGATIONS UNDER THE BIOLOGICAL DIVERSITY ACT, 2002
2.1 Meaning and forms of benefit-sharing
The Convention on Biological Diversity's grand bargain is fair and equitable benefit sharing. It requires that the benefits arising from the utilisation of genetic resources be shared with the provider. The key goal is to facilitate a mutually beneficial agreement whereby the user benefits from the innovation while the provider benefits from the resources needed for conservation and local development.
The money is the most tangible sharing. These are paid at the outset of the project (at the time of sample collection), paid when a drug enters clinical trials (milestone payments) and paid as a percentage of sales (royalties).
2.2 Who determines and collects benefits
Negotiating benefit-sharing agreements is one of the more complicated challenges for the National Biodiversity Authority. Then, the NBA becomes a trustee of the funds and finally shares them with the communities that contributed the resource or the related knowledge.
Domestic companies' top source of information is Divya Pharmacy. The company said it was not bound by the provisions of the Act, which it said was applicable to foreigners, as it was an Indian company. The Uttarakhand High Court said this was not so and that Indian companies are not free from the obligation to pay benefits. It also held that State Biodiversity Boards have the inherent power to require benefit sharing from domestic companies even when NBA has not issued national guidelines in this regard.
2.3 Why the obligations are not being delivered
A failure to have a feedback loop compromises delivery. The NBA may take a cut from a foreign firm that provides the resource, but the Biodiversity Management Committee that supplied the resource may not know how much was collected, or when it will receive a cut.
Financial funds seldom make it to the village. When the community does not benefit from its People's Biodiversity Register (PBR), it is not an incentive to keep it. Although the National Biodiversity Fund has accumulated substantial sums, very little has trickled down to the BMCs that undertook the work of documenting the resources. This has given rise to general “PBR fatigue” throughout rural India.
The picture is complicated by Centre–State disputes. The State Biodiversity Board often asserts that the benefit-sharing fees should be deposited into the State Biodiversity Fund, instead of the National Biodiversity Fund.
3. ENFORCEMENT GAPS
In several areas of India, the ones responsible are under-resourced and overburdened.
First, the legal activation is not known. Whether there are benefit-sharing obligations depends upon the term “commercial utilisation”. In case of commercial use, payment is required, in case of traditional use or research, the user is exempt. If the NBA follows this logic, then the benefit sharing requirement can be circumvented by doing less than processing.
Second, the current penalties are not very effective at being a deterrent. The effectiveness of a sanction is more related to how sure of punishment than its severity. Violation of biopiracy, which can give multi-billion dollar returns, is not a punishment; it is a licence fee of ₹10 lakh (about US$12,000).
Thirdly, adjudication is weak and slow. The slow pace of the Indian litigation process is advantageous to the biological resources misappropriators.
Fourth, the institutions and access to digital resources are still weak. In many parts of the country, the so-called Biodiversity Management Committees are ghost institutions, the lifeless heart of the Act, the sentinel of village resources. They are paper based and in the government registers but have no budgets, training or awareness of the tools that are available to them in law. The NBA has no jurisdiction, no benefit sharing is due, and the community that saved the plant generation after generation gets nothing.
4. PROPOSED REFORMS, WITH ARGUMENTS IN FAVOUR AND AGAINST
4.1 Reform One: Define “commercial utilisation” and the value-added product exemption
A bright line statutory definition of 'commercial utilisation' is required. It should include any use of biological resources that leads to, or is designed to lead to, an application for patent, a product placed on the market or a service that generates revenues. The ambiguity surrounding the value-added products exemption should be clarified by stating that the exemption will only extend to a final fully processed end product, which is not in any way related to the original biological resource.
In favour: Divya Pharmacy and academic writing by Morgera provide clear benefit sharing obligations.
Against: Reddy notes that the same Court recognized that the plain meaning supported the petitioner, but Laird and others warn of the costs to legitimate research of broad benefit-sharing requirements.
4.2 Reform Two: Proportionate and civil penalties
Penalties should be rethought as proportionate fines, based on the commercial benefit gained from the offence, with a minimum threshold to prevent minor offences from being considered trivially. Fines should be tied to the return from the misappropriated resource to be an actual deterrent. As long as the cost of biopiracy is less than its profits, the legal framework will be a minor irritation to the global biotechnology industry.
The revised section 55 states that the penalty is ₹1 lakh to ₹50 lakh (or more if the damage exceeds this amount) to be determined by an adjudicating officer from 1 April 2024 onwards.
In Favour: The supporters of deterrent, capacity linked liability are M.C Mehta and Vellore Citizens' Welfare Forum.
Against: The Joint Committee on the Biological Diversity (Amendment) Bill accepted the principle of decriminalisation.
4.3 Reform Three: Specialised adjudication
The High Courts and the National Green Tribunal should set up specific Technical Benches to handle the intellectual-property issues pertaining to biodiversity. The bench should consist of a judge sitting with a scientific assessor from a national panel of scientists competent in biochemistry, ecology, plant genomics and other related areas. A legislative amendment should introduce a fast track procedure for urgent cases where the traditional knowledge is lost or the biological resources are endangered in NBA and State Biodiversity Boards' decisions and designate the NGT as the appellate body for NBA and State Biodiversity Boards' decisions.
In favour: Chandra Bhal Singh shows that the NGT's time-bound orders have made BMC formation move from about 3.58 per cent of local bodies in 2016 to about 90 per cent by 2020.
Against: L. Chandra Kumar Advocate that the basic structure of the Constitution includes High Court judicial review of tribunals and thus final can only mean exclusive first appeal.
4.4 Reform Four: Securing the flow of benefits to communities
The immediate institutional change is the revitalisation of the Biodiversity Management Committees. The gap between the three-tier institutional structure as envisioned and as implemented is the single biggest failure in the BDA implementation.
The national civil service should have a dedicated Biodiversity Governance Cadre consisting of trained civil servants posted at district level, who are tasked to support BMCs in a legal and scientific capacity. The law should require that a statutorily mandated percentage (not less than sixty per cent) of any benefit sharing payout to the NBA be directed to the appropriate BMC in a specific period of time.
In favor: Divya Pharmacy and the NGT's record of accomplishment proves that communities can benefit from time limits.
Against: Laird and others note that benefits sharing often provides only poor development returns, instead of tangible conservation results. There is also a formidable logistical challenge—the fact that there are over 250,000 panchayats in India. Having a working BMC in each of them would need an extensive administrative structure, since they would need to be established, trained and audited.
4.5 Reform Five: Digital registers and the Digital Sequence Information gap
Priority must be given to the digitisation, standardisation and inclusion of People's Biodiversity Registers in the national system for the management of biodiversity. The Patent Office and the NBA need to create an actual digital interface to connect the two; the current referral process is still mostly manual and paper-based with frequent delays.
In favor: Laird and others admit there's a big hole in the omission of DSI.
Against: Conventional benefit-sharing models are not suitable to Digital Sequence Information, the authors argue in against.
4.6 Reform Six: Independent review of the 2023 Amendment
The 2023 amendment to the Biological Diversity Act is deeply problematic in the present context. Although the government presented it as a rationalisation intended to ease compliance for the AYUSH industry and to attract foreign investment in biotechnology, critics have correctly observed that it decriminalised several offences and narrowed the scope of benefit-sharing obligations in ways that weaken the Act’s deterrent effect.
The amendment sought to clarify certain terms, yet it has been criticised for diluting the rules in favour of the AYUSH sector. This illustrates that the definition of key concepts is not a neutral technical exercise; it is a political contest between economic priorities and community rights.
In favour: Jairam Ramesh, a member of the Joint Committee, warned that the AYUSH exemption could open the law to abuse.
Against: The majority of the Joint Committee supported the Bill.
5. CRITICAL EVALUATION
The six reforms are linked together as a unit. A clear statutory definition tells users when payment is due; proportionate penalties provide a credible reason for compliance; specialist benches and the NGT help ensure dispute resolution in a timely fashion; institutional strengthening of BMCs ensures that communities benefit from the law; and measures addressing Digital Sequence Information mean it remains relevant in the face of technology change.
6. CONCLUSION
The focus of this assignment has been on the possibility of strengthening the enforcement of the Biological Diversity Act, 2002 and the benefit-sharing requirements more specifically, by legal and policy reform.
It is not a lack of law that India suffers from. What it's missing is implementation—the careful, resource-heavy effort of putting the law into practice in the village, keeping the law in step with technological developments, and maintaining political resolve against pressures that would dilute biodiversity protection.
The six reforms above are aimed at bridging the gap between the law as written and the law as observed.
BIBLIOGRAPHY
Statutes
Biological Diversity Act, 2002, No. 18, Acts of Parliament, 2003 (India).
Biological Diversity (Amendment) Act, 2023, No. 10, Acts of Parliament, 2023 (India).
Articles and Reports
Joint Comm. on the Biological Diversity (Amendment) Bill, 2021, Report of the Joint Committee on the Biological Diversity (Amendment) Bill, 2021 (17th Lok Sabha, 2022) (India).
Laird, Sarah et al., Rethink the Expansion of Access and Benefit Sharing, 367 Science 1200 (2020).
Morgera, Elisa, The Need for an International Legal Concept of Fair and Equitable Benefit Sharing, 27 Eur. J. Int’l L. 353 (2016).
Reddy T., Prashant, The Uttarakhand High Court’s Flight of Fancy While Interpreting the Biological Diversity Act, SpicyIP (Dec. 2018), https://spicyip.com/2018/12/the-uttarakhand-high-courts-flight-of-fancy-while-interpreting-the-biological-diversity-act.html.
Tandon, Mridhu, India’s Biological Diversity Act Finally Shows Progress Due to NGT, Mongabay India (June 9, 2020), https://india.mongabay.com/2020/06/indias-biological-diversity-act-finally-shows-progress-due-to-ngt/.
List of cases
Chandra Bhal Singh v. Union of India, O.A. No. 347 of 2016 (Nat'l Green Trib. Principal Bench)
Divya Pharmacy v. Union of India, Writ Petition (M/S) No. 3437 of 2016, 2018 SCC OnLine Utt 1035
L. Chandra Kumar v. Union of India, (1997) 3 S.C.C. 261
M.C. Mehta v. Union of India, A.I.R. 1987 S.C. 1086
Vellore Citizens Welfare Forum v. Union of India, (1996) 5 S.C.C. 647