By Aditya Bhattacharya

In 1998, when two Czech nationals were arrested for collecting a particular species of butterfly from a national park under the Biological Diversity Act, 2002 (BDA), the news went unnoticed. India Inc. never thought that the provisions applied in that situation would also apply to companies utilising biological resources native to India.

In 1993, the UN Convention on Biological Diversity (CBD) came into force, and, in 2014, India became party to the Nagoya Protocol. The protocol puts in to effect a system of equitable sharing which helps member-states allow stakeholders in a biological resource to share the benefits of its utilisation in the hands of persons including corporate. The consequence of this for India was promulgation of the BDA and, thereafter, of the Guidelines on Access to Biological Resources and Associated Knowledge and Benefits Sharing Regulations, 2014 under the BDA; this was the framework for equitable benefit sharing to be put into effect by the authorities created under the law. The BDA laid down a three-tier implementation structure: the National Biodiversity Authority (NBA) at the national level, State Biodiversity Boards (SBBs) at the state level, and Biodiversity Management Committees (BMCs) at the local level. Under the BDA, applicants were divided into two categories for grant of approval. The restrictions imposed and exemptions available under the BDA also varied based on the category of the applicant. Approval was to be granted by way of an agreement, with mutually-agreed terms and conditions between the applicant and the authorities.

India’s commitment to the Nagoya Protocol is special and unlike many other nations, given its rich biological diversity. We have companies and entities (FMCGs, tea, food supplements, pharmaceuticals, Ayurveda, Unani, agriculture, etc) historically using biological resources. The provisions of eligibility/applicability under BDA, however, desperately need clarity. The definitions under the BDA—the basis for substantive provisions—are nebulous. Also, the roles, responsibilities, and powers of the authorities are a matter of heated legal debate, especially on whether these have the trappings of a judicial authority or are there merely to facilitate agreement between the stakeholders for equitable sharing.

In addition, the framing of regulations by the authorities under the BDA are being debated on issues of validity, especially where authorities are seeking monetary compensation from corporate stakeholders. From where is this power being sourced by the authorities? Can this be at all done legally? These regulations, rather than providing clarity, are creating confusion among the parties affected. In fact, the regulations raise an important question that needs to be addressed immediately: To what extent can the authorities go to achieve the purpose of the BDA? The law is creating a sense of insecurity which may result in stakeholders moving to courts challenging the provisions and/or the regulations.

What makes the issue even more serious is the fact that BDA, under Section 58, arms the authorities with powers to initiate magisterial action against entities not in compliance. This means, in a situation where an entity contravenes any provisions, the authorities have the power to register an FIR that may result in the entity being charged with a cognisable and non-bailable offence. The provisions of the BDA and the ensuing regulations have been subject to multiple interpretation; in fact, its applicability to certain entities is itself a point of dispute. Section 58 looks, prima facie, like a provision to armtwist subjects of the legislation. Indeed, it is not hard to imagine a situation where a top official of a company is dragged to a magisterial enquiry, even as the company is unaware that the BDA may be applicable to it.

The answer to all such problems is the legislature amending the law to ensure that the BDA is implemented to achieve its underlying objectives and not to unnecessarily fetter the sustainable use of biological resources.

The author is Partner, Lakshmikumaran & Sridharan Attorneys

Co-authored with Vindhya S Mani (joint partner) & Sutapa Jana(principal associate)