Uttarakhand High Court: Biodiversity boards can impose fees on Ramdev's Divya Pharmacy

By Mridhu Tandon
In a significant decision, the Uttarakhand High Court on December 21, 2018 has dismissed the writ petition filed by Divya Pharmacy founded by Baba Ramdev and Acharya Balakrishnan, challenging the demand of the Uttarakhand Biodiversity Board (UBB) imposing fees under the provisions of the Fair and Equitable Benefit Sharing (FEBS).
The judgment delivered by Justice Sudhanshu Dhulia held that the Court is of the opinion that SBB has got powers to demand Fair and Equitable Benefit Sharing from the Divya Pharmacy.
Divya Pharmacy has claimed that UBB cannot raise a demand, under the head of “Fair and Equitable Benefit Sharing” (FEBS), as the Board neither has the powers nor the jurisdiction to do that and, secondly, the Divya Pharmacy also claimed that it is not liable to pay any amount or make any kind of contribution under the head of FEBS.
The main contention was that only a foreign entity was liable to pay under the FEBS and not an Indian entity. Since Divya Pharmacy is a 'purely Indian company', it was not required to pay any fees under FBES. In addition, unlike a foreign company, an Indian company was not required to obtain 'prior approval' from the National Biodiversity Authority but only 'intimate' the State Biodiversity Board.
The State Biodiversity Board however contented that there is no distinction between an Indian entity and a foreign entity and the only entities who are not liable to pay are growers and cultivators of biological resources including vaids and hakims.
The judgment considered main objective of the Biological Diversity Act, 2002 and specially FEBS at length. According to the Court:
"The Indigenous and local communities, who either grow 'biological resources', or have a traditional knowledge of these resources, are the beneficiaries under the Act. In return for their parting with this traditional knowledge, certain benefits accrue to them as FEBS, and this is what FEBS is actually all about. This benefit the 'indigenous and local communities', get under the law is over and above the market price of their 'biological resources'.”
The Court dealt at length on the implications of Convention on Biological Diversity as well as the Nagoya Protocol of 2010 on Access and Benefit sharing (ABS). According to the Court, "The local and indigenous communities local and indigenous communities” are "the ones that need this protection and they are the ones who were at the centre of concern at Nagoya" and that Nagoya Protocol makes it clear that FEBS is for the benefit of “the local and indigenous communities”.
The Court highlighted that the Nagoya Protocol makes no distinction between a foreign entity and an Indian entity, as regards their obligation towards local and indigenous communities in this regard. Consequently the “ambiguities” in the national statute have to be seen in the light of the international treaties, i.e. Rio and Nagoya, and a purposive rather than a narrow or literal interpretation has to be made, if we have to arrive at the true meaning of FEBS.
Commenting on the rights of “indigenous and local communities”, the Court said, rights of “indigenous and local communities” were extremely important and emphatically declared in the Nagoya Protocol. These rights have to be protected, equally from outside as well as from within.
"The focus of the Nagoya Protocol is on FEBS, and protection of indigenous and local communities, and the effort is that the indigenous and local communities must get their fair and equitable share of parting with their traditional knowledge and resources. India being a signatory to the Rio and the Nagoya Protocol, is bound to fulfill its international commitments and make implementation of FEBS effective and strong", it added.
Suggesting that biological resources are the property of the indigenous communities and not just of the nation, the Court recognized that the local and the indigenous communities in Uttarakhand, who reside in the high Himalayas and are mainly tribals, are the traditional “pickers” of this biological resource.
Through ages this knowledge is preserved and passed on to the next generation. The knowledge as to when, and in which season to find the herb, its character, the distinct qualities, the smell, the colour, are all part of this traditional knowledge. This knowledge may not strictly qualify as an intellectual property right of these communities, but nevertheless is a “property right”, now recognised for the first time by the 2002 Act, as FEBS.
Can it be said that Parliament on the one hand recognised this valuable right of the local communities, but will still fail to protect it from an “Indian entity”. Could this ever be the purpose of the legislature?, wondered the Court.
“Biological resources” are the property of a nation where they are geographically located, but these are also the property, in a manner of speaking, of the indigenous and local communities who have conserved it through centuries, it observed.
Commenting on power of the State Biodiversity Board to impose fees, the Court said, it "must be stated that regulating an activity in form of demand of a fee is an accepted practice recognised in law. Therefore, in case the SBB as a regulator, demands a fee in the form of FEBS from the petitioner when the petitioner is admittedly using the biological resources for commercial purposes, it cannot be said that it has no powers to do so."
"Court is of the opinion that SBB has got powers to demand Fair and Equitable Benefit Sharing from the petitioner", the Court said, dismissing the challenge to the Guidelines on Access to Biological Resources and Associated Knowledge and Benefits Sharing Regulations, 2014.
Divya Pharmacy was represented by Advocate G Partahasarthy while the Uttarakhand State Biodiversity Board was represented by Advocate Ritwick Dutta. The Union of India as well as the National Biodiversity Authority adopted the stand of the State Biodiversity Board.