Following the Maharashtra State Biodiversity Board (MSBB) serving more than 300 notices over the past three months, around 12 manufacturers in the state have deposited Rs.10 lakh as royalty based on the access and benefit sharing (ABS) compliance as per the provisions of the Biological Diversity Act, 2002.
It is required to share benefit among concerned Biodiversity Management Committees (BMC) of the state for sustainable use of bio-resources as per Biological Diversity (BD) Act, 2002, as per the MSBB notice. The notice also stated that MSBB has the mandate to collect ABS payment under the provisions of Biological Diversity (BD) Act, 2002.
As per the BD Act, around 95 per cent of ABS will be given to Biodiversity Management Committee (BMC) for sustainable development of bio-resources. Thus industries can be associated with the local people from where bio-resources are obtained to get continuous supply of bio-resources in perpetuity.
This comes close on the heels of National Green Tribunal (NGT) recently passing an order asking for royalties in the form of ABS payments from companies engaged in commercial utilisation of castor plant and other bio-resources for manufacturing drugs and cosmetics.
The NGT Judgment also specifies that ABS is applicable to bio-resources from agriculture or forest area. An agriculture bio-resource when utilised for general commodities, no ABS is applicable. However, when utilised for commercial purposes for use in drugs and cosmetic products, ABS is applicable to it. ABS is also applicable for access to biological resources, bio-survey and bio-utilisation for commercial utilisation.
Member-secretary of MSBB Dr Dilip Singh had issued notices to defaulting traders and manufacturers in response to non-payment of ABS to MSBB as commercial utilisation of bio-resources is tantamount to violation of Section 2(c) (f) and Section 7 of Biological Diversity Act, 2002.
The NGT further gave instructions to MSBB to take appropriate action against defaulting parties and in case the parties do not respond, their names to be published in newspapers and thereafter prosecution to be filed against them as per the law. It has been further directed that violation of Sections 7 and 24 (2) of Biological Diversity Act, 2002 by not giving prior intimation to State Biodiversity Board (SBB) in case of access to biological resources for commercial purposes, companies shall be held liable and punishable with imprisonment for a term which may extend to 3 years or with fine which may extend to Rs.5 lakhs or with both under Section 55 (2) of the BD Act.
Under section 55(1) whoever contravenes the provisions of Section 3 or Section 4 or Section 6 shall be punishable with imprisonment for a term which may extend to five years, or with fine which may extend to Rs.10 lakhs and where the damage caused exceeds Rs.10 lakhs such fine may commensurate with the damage caused, or with both.
As per the MOEF notification, dated November 21, 2014 the benefit sharing obligation from trader and manufacturer shall be in the range of 1 to 3 per cent and 3 to 5 per cent respectively of the purchase price of the biological resources. However, there is option to pay benefit sharing on sale price of the biological resources accessed for commercial utilisation under the law. For annual gross ex factory sale of product, in case of Rs.one crore benefit sharing will be 0.1 per cent, for Rs.1 to Rs.3 crores, it would be 0.2 per cent, for above Rs.3 crores turn over, the benefit sharing will be 0.5 per cent.
Some manufacturers have, however, questioned the irrationality of the ABS notification saying that it is applicable to foreign companies only. It is not applicable to Indian manufacturers as most of the raw material is not commercially utilised. On the other hand, as per an MSBB official, law exempts commonly traded commodities for general consumption and not commercial utilisation of bio-resource as stipulated in the November 21, 2014 ABS notification.