Bio-piracy cases:

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It is also worth stressing that all the cases above took place in the absence of the formal legal safeguards for TKaGRs holders, as well as the lack of official criteria to judge the equity. Nonetheless, goodwill of stakeholders, the intervention of local authorities and the involvement of relevant actors (for example, NGOs or research institutions) became crucial determinants of success. It would be a valuable suggestion in the establishment of the future ABS framework.

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Later, on June 8, 2006, a patent application with similar substantial content was filed to the Vietnam Intellectual Property Office, but was rejected by the office on the following grounds: 1/ the method of treatment was identical to that of the Patent US 2003/0152651 granted in the US; 2/ the same knowledge was already in the traditional herbal formula named “Gia Vi Ich Tam Khang” that was collected and described in the book “Thien Gia Dieu Phuong” published by The Central Institute of Information and Library for Medical Sciences of Vietnam in 1989; 3/ the relevant knowledge also appeared in “Phuc phuong dan sam phien” herbal formula in the book “Chinese traditional medicines” published by the Hanoi Medical Publishing House in 1992. Hence, putting aside the rejected claim of the patent application in Vietnam, the patent granted in the United State obviously failed to satisfy the requirement of novelty because its development was based on knowledge that already existed in Vietnam and China. However, no legal response has been raised against the US’s patent thus far by interested parties.

5.4.2.2. Unfair benefit sharing: Nature’s Way with Panaxvietnamensis²⁷⁰

The case happened in the late 1990s in Vietnam. The involved parties include:

- Nature’s Way: An US. Pharmaceutical company

- The Government of Vietnam (represented by the Ministry of Agriculture) - People’s Committee of Kon-tum Province (Vietnam)

- Researchers from scientific institutes and universities

- Community of the Sudang ethnic minority group in Kon-tum Province (Vietnam)

The Nature’s Way concluded an agreement with the Government of Vietnam and the People’s Committee of Kon-tum Province to access, cultivate, conduct scientific research and commercialize Panaxvietnamenis- an herbaceous medical plant in Ngoc Linh region, Kon-tum Province. (It is noteworthy that the central and local governments

270 Source: Ten Kate. K. & Laird.S.A., THE COMMERCIAL USE OF BIODIVERSITY.ACCESS TO GENETIC RESOURCES AND BENEFIT-SHARING (Earthscan, London, 1999), at 113-114.

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participated in the case as the representatives for ownership over natural resources, namely Panaxvietmenis plants in this case. The Sedang community got involved as a party in the labor contract). Panaxvietnamenis was used locally and historically by Sedang ethnic group as a secret life – saving medicine for the treatment of a range of diseases and to enhance physical strengthen. The project was carried out with the involvement of Nature’s Way, central and local governments of Vietnam, researchers and local community of Sudang group, in which, in term of benefit sharing:

- 70% of profit would go to Nature’s way, 30% to the Government (Nature’s Way would cover all cost of labor, materials and other expenses)

- Researchers would get benefit from equipment funding, training and support for graduation, research exchanges with US universities, sponsorships for scientific meetings, among other things

- Sudang community would be paid labor cost to cultivate Panaxvietnamenis It should be noted that the agreement neglected the role of TKaGRs of the Sudang group, and tended to treat Panax vietnamenis as a physical material, therefore no compensation was paid for access and utilization of the community’s TK associated with Panax vietnamenis. The research process came up with a number of medical products, however, as of yet, no evidence has been shown about the sharing of IPRs of those products between Nature’s Way and concerned parties, including the Sudang community.

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5.4.3.3. Protection of TKaGRs by trademark: Dao’ Spa case²⁷¹

Part 5.4.1.1 mentioned the successful model of Sapa Napro company. In an effort to protect the traditional products by the mean of IPRs, the company registered trademark and was granted “Dao’s Spa” Trademark for the bathing medicine on November 17, 2008.

However, products imitating Dao’s Spa medicine appeared in the market with large quantities, in which producers clearly indicated the source of product as from Dao ethnic minority, but under the name of imitators’ own businesses, not under that of “Dao’s Spa”.

Therefore, although the economic loss of SaproNapro company was observed, no claim can be raised due to the absence of the IP law’s violation.

5.4.3.4. Lessons learned

The cases indicated above do not directly reflect ABS relations, but circumstances where TKaGRs is used against the will and desires of its holders. In the other words, these cases exemplify the acts of “bio-piracy” – the utilization of TKaGRs without complying with the principles of “prior informed consent” and “fair and equitable benefit sharing”.

They illustrate situations where users of TKaGRs free ride the weakness of the legal system in order to use TKaGRs in bad faith.

In the first case, the misappropriation by the mean of patent stemmed from the ignorance of related parties in protection of TKaGRs and the inaccessibility of published prior art to foreign patent examiners (because documentation of TKaGRs, in this circumstance, was published in the national language (Vietnamese) and was not digitalized).

The case is not directly linked to ABS though, but raises the issue on the linkage between patents and the threat of unenforceability of the “prior informed consent” and “fair and equitable benefit sharing” principles in the ABS mechanism. On that account, such linkage

271 Source: Tran Van Hai, Commercial exploitation of traditional knowledge – from the perspective of Intellectual property rights [Khai thác Thương mại đối với tri thức truyền thống - tiếp cận từ quyền Sở hữu trí tuệ], 3 Journal of Scientific Activities [Tạp chí Hoạt động khoa học] 54, at 54-59 (2012).

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should be thoroughly dealt with by laws and practical measures to support proper functions of the ABS mechanism in practice.

In the case of Nature’s way, traditional knowledge associated with the use of Panaxvietnamenis held by the Su dang community was not taken into account in the contract terms. The users considered Panaxvietnamenis merely as physical material without considering “intangible value” as traditional knowledge associated with it, therefore no compensation was paid for TKaGRs. This would also be attributable to the fact that TK on the use of Panaxvietnamenis was no longer under the control of the Se dang group and already spread out into the public domain, resulting in difficulties for holders to claim their rights. Participating in the case, the Se dang group was self-presented and in marginal position without any legal and technical supports.

Different from the other two cases of bio-piracy discussed above, the bio-piracy that happened in the case of Sapa Napro company was not attributed to lack of diligence or awareness. The company, in contrast, seriously concerned about preventive measures against misappropriation of TKaGRs, in which “Dao Spa” trademark was one among efforts to achieve that objective. The case shows that Trademark or other relevant IP instruments (geographical indications, for example) has only distinguishing function that could not prevent third parties from the misuse of knowledge associated with products bearing trademark.

In brief, those case studies demonstrate that bio-piracy may be attributed to three main causes. Firstly, it is the conflict between the IP system and TK that inadvertently facilitates bio-piracy of TK. Secondly, given the nature of TK as an intangible asset, the lack of a legal mechanism for recognition of ownership/stewardship over that asset unwittingly places TK into the public domain, which leaves TK holders unprotected.

Thirdly, the lack of legal and technical supports in the context of imbalance of bargaining power results in outcomes unfavorable to TK holders.

TKaGRs has a long-established history with the formation even before formal institutions of state and law. However, the situation of "bio-piracy" shows that, although

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TKaGRs has been governed distinctively in the traditional context, the legal protection over TKaGRs is still an important factor to protect the legitimate rights and interests of TKaGRs holders. While TKaGRs takes effect only within the boundary of traditional communities, the legal protection serves as the mechanism to curb unauthorized use of TKaGRs that may happen outside the community, and to ensure that the principles of "PIC", "MAT” are fully complied with during ABS processes.