4-Patents: Argentina and biotech firms agree on royalty bid

[GENET <coordination@genet-info.org>]

Monsanto Plans To Charge Fee On Argentina's Soy Exports

<http://www.agprofessional.com/show_story.php?id=29447>

Dec. 17, 2004

Monsanto announces plans to charge Argentine exporters a licensing fee
for every ton of soybeans shipped abroad, according to a Dow Jones report.

"We sent a letter to exporters letting them know about this," said
Federico Ovejero, manager of public and government affairs for Monsanto.

Initially the fee would be 2 percent on the per ton value of a shipment
and eventually would rise to 3 percent per ton, Ovejero said. At current
prices, this would force exporters to pay about $3 for every ton of soy
exported.

The plan is part of Monsanto's effort to collect royalties on the use of
its genetically modified soybean seeds.

Ovejero said the plan is not definitive. Monsanto is still negotiating
with the Agriculture Secretariat and farm groups to reach a consensus
about how to ensure royalties are paid, he said. "We are committed to
continuing talks with the government and the rest of the players here to
reach a consensus," he said. "But on the other hand, we need to implement
a (royalties collection) system for the 2004-05 campaign. If there is not
an effective system in place by then, we'll move forward with our
proposal, which involves selling licenses to exporters."

Around 95 percent of Argentina's soybeans are genetically modified, and
most farmers use Monsanto-made seeds. Monsanto struggles to collect
royalties on the seeds because they can be used year after year by
farmers who pay for them just once. The company stopped selling the seeds
in January, saying it was no longer profitable.

Monsanto claims that many seeds are sold unauthorized in Argentina's vast
underground seed market, depriving the company of a legitimate source of
revenue. Ovejero says this revenue is necessary to ensure Monsanto
continues to
invest in new products.

However, farm groups oppose Monsanto's plan. Argentina's Rural Society,
the country's largest and oldest farm group, said that royalties should
be paid for but not as a licensing fee on the sale of grains.



-------------------------------- GENET-news -------------------------------

TITLE:  Argentina and biotech firms agree on royalty bid
SOURCE: Reuters, posted by Checkbiotech, Switzerland
        http://www.checkbiotech.org/root/index.cfm?fuseaction=newsletter&
        topic_id=3&subtopic_id=16&doc_id=9298
DATE:   15 Dec 2004

------------------- archive: http://www.genet-info.org/ -------------------


Argentina and biotech firms agree on royalty bid

BUENOS AIRES - Argentina's government and biotechnology firms have agreed
on the key points of a proposed compensation fund for companies hurt by
illegal trading in genetically modified seeds.

The government announced the breakthrough on Tuesday, three months into
talks with companies that were launched after global biotech pioneer
Monsanto (MON.N) stepped up pressure to charge royalties on soybeans
exported from Argentina. "In these three months we've made strong
progress and we are now ready to begin drafting the necessary legislation
so that seed trade in Argentina is transparent, once and for all," said
Agriculture Secretary Miguel Campos in a statement.

"In 30 days we could put a full stop to this issue," he added.

The goal of Argentina, the world's No. 3 soybean producer, is to send a
bill to Congress for the creation of a "technology compensation fund" for
makers of GMOs, or genetically modified organisms.

The government aims to have the compensation fund set up for all types of
seeds in the 2005/06 growing season.

Monsanto is pushing hard to recover millions of dollars in lost revenue
in three South American countries where farmers have sown its engineered
soybean seeds, called Roundup Ready, without paying royalties.

Argentina's seed business is worth an estimated $1 billion a year and the
prosperous black market is mainly in soybeans, the country's top crop and
biggest export.

Farmers in Argentina widely use Monsanto's "Roundup Ready" seeds. The
pirated seeds produce soy plants resistant to Monsanto's' Roundup Ready
herbicide and make growing soy crops cheaper.

In the agreement signed by the government, companies and producers - a
copy of which was obtained by Reuters - the parties agree the extra
charge will be applied at the moment the commodity changes hands in
Argentine markets and will not be a tax on production.

Monsanto says only 18 percent of the 14 million hectares of soybean crops
in Argentina are seeded with certified seeds and sold in the legal market.




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