Public hearing debates impacts of industrial property policies on agribusiness

The challenges to strengthening the Brazilian intellectual property (IP) system and the impacts of IP on agribusiness were debated at a public hearing in the Federal Senate on Thursday (13). “Intellectual property (IP) systems are a central part of the globalized economy and also affect agribusiness. Developing new products and bringing them to market is a time-consuming, risky and expensive process. A strong IP system encourages innovation, remunerates research and generates a virtuous circle of knowledge advancement”, highlights Sebastião Pedro da Silva Neto, secretary of innovation and business at Embrapa.

When citing the increase in public-private partnerships in the seed industry, the secretary highlighted that IP also has implications for the formalization of partnerships. “The limitations and obstacles of current IP mechanisms in Brazil are always taken into account when establishing partnerships. Furthermore, the time to obtain a patent or cultivar protection is also taken into account in these relationships”, he recalls.

The waiting time for patent applications to be decided in Brazil is 10,8 years for analyzes in the area of ​​biotechnology, 8,3 years for agrochemicals and 8,5 years for food and agronomy, according to INPI data. “Excessive spending on royalties reduces the competitiveness of Brazilian producers compared to their direct competitors. In 2017, the Brazilian producer of RR2 soybeans paid royalties 150% higher than the amount paid by the Argentinean soybean grower. There were R$916 million in royalties, which corresponds to 51% of the cost of seeds”, highlights senator Lasier Martins (PODE-RS), who made the request to hold the public hearing.

The Agriculture and Agrarian Reform Commission (CRA) brought together representatives from Embrapa, INPI, Presidency of the Republic, Brazilian Intellectual Property Association (ABPI), Ministry of Agriculture, Livestock and Supply and Unicamp in the discussion. In addition to Embrapa's innovation secretary, Pedro de Abreu and Lima Florêncio, advisor to the Government Secretariat of the Presidency of the Republic, Rafael Mafra, director of the Department of Technical, Sanitary and Phytosanitary Topics at MAPA, Antônio Márcio Buainain, professor from the Unicamp Institute of Economics, Saulo da Costa Carvalho, president of the Association of Employees of the National Institute of Industrial Property, and Maria Isabel Coelho de Castro Bingemer, coordinator of the Cultivar Study Committee of the Brazilian Intellectual Property Association - ABPI. The table was chaired by senator Soraya Thronicke (PSL-MS).

For professor and researcher Antonio Marcio Buainain, from Unicamp, the agricultural sector has not benefited as much from intellectual protection mechanisms given the slowness in analyzing patents. “We cannot do without a strong educational system, and also a solid intellectual property protection system that offers legal security. INPI is almost abandoned. We need to address two central issues: how to contribute to improving the legal framework for intellectual property and how to strengthen the INPI”, he highlights.

The researcher commented that agriculture is going through a “critical moment” and the future of the sector is at stake if economic circumstances and market transformations are considered. “The commodity price boom phase has passed, low prices threaten some segments and may remain at these levels if we consider that the most likely scenario of the conflict between China and the United States is China importing more from the USA”, he highlights.

According to Buainain, in addition to external factors, internal economic stagnation and the political agenda also generate market distortions and mitigate the agricultural sector's ability to advance more quickly. “Brazil knew how to take advantage of the tropical agricultural revolution in the 1970s, but countries and corporations can no longer be competitive if they are unable to keep up with the paradigm shifts. The binomial sustainability and competitiveness needs innovation. It is a challenge for everyone, which must involve the productive sector and should not be led only by institutions like Embrapa”, he comments. 

Stock of patent applications

Participants in the public hearing agree that Brazil needs to implement an action plan to reduce the so-called “backlog”, the stock of patent applications accumulated at the INPI. “The accumulated stock is large, but smaller than compared to other countries. While in Brazil we have 200 thousand claims, in the USA there are 610 thousand”, highlights Pedro Florêncio, advisor to the Presidency of the Republic.

On the other hand, when analyzing requests by number of examiners, Brazil has a much higher per capita “backlog” than developed countries. “While Brazil has 200 examiners, the USA has 10 thousand”, highlights Pedro.

The combination of a high backlog and a reduced team of examiners means that Brazil has an average analysis time more than five times higher than the European Union, China and Japan. “We have 10 years of average analysis time, while in Europe it is 1,9 years, in China 1,8 years, and 1,3 years in Japan”, he says.

Simplify processes and adopt remote work

For the presidential advisor, in a scenario of fiscal restrictions, it is unlikely that the government will have the means to expand the team of patent application examiners through public competitions. “The path is to simplify processes, adopt remote work, and continue to adopt good practices to increase productivity per examiner”, he comments. 

In 2015, each INPI patent examiner evaluated, on average, 25 claims per year. In 2017, average productivity increased to 55 processes per year. If current productivity were maintained, and considering a team of 200 examiners, Brazil would take 18 years just to examine the current “backlog” with 200 thousand accumulated claims.

“There is no intellectual property culture in Brazil. As a result, INPI has an insufficient number of examiners. Strengthening INPI also means strengthening Embrapa and the agro sector. We estimate that the delay in patent analysis generates an annual loss of R$1 billion for the agricultural sector”, highlights Saulo Carvalho, INPI representative at the public hearing.