A New Beginning for International Benefit-Sharing? Harmonising and Complying with Rules on Digital Sequence Information
by Adam Strobeyko
Published on 23 February 2025
Opening Plenary of the HL Segment – Peace with Nature at COP16.
The 16th meeting of the Conference of the Parties (COP16) to the Convention on Biological Diversity (CBD) will convene in Cali, Colombia from 21 October – 1 November 2024, under the theme: Peace with Nature. In Cali, country representatives will discuss the implementation of the Kunming-Montreal Global Biodiversity Framework, a landmark 2022 agreement to halt and reverse nature loss.
Access and Benefit Sharing (ABS) promotes the sharing of resources and information essential for scientific research and development (R&D), along with associated benefits such as monetary or in-kind contributions, data access, intellectual property rights, scientific collaborations, and capacity building. ABS seeks to address equity issues surrounding some of the most prominent challenges of our time, including biodiversity loss and pandemics.
In this context, access to pathogen digital sequence information (DSI) is particularly important for genomic surveillance, pandemic risk assessment, and R&D of health products. In the absence of international rules, DSI regulation has largely depended on database policies and national laws. However, the rules governing DSI are likely to change soon, as the topic has received attention in multiple international fora.
In November 2024, the Conference of the Parties of the Convention on Biological Diversity (CBD COP), held in Cali, Colombia, adopted Decision 16/2 establishing a multilateral mechanism for the sharing of benefits resulting from the use of DSI. Decision 16/2 represents a significant step in regulating DSI benefit-sharing and an ambitious attempt to establish an international framework on the issue. However, its legal nature, implementation, and connection to the ongoing Pandemic Agreement negotiations raise several legal issues. The lack of a globally agreed definition of DSI complicates the legal landscape, as the term remains a placeholder under ongoing CBD discussions. Additionally, Decision 16/2’s focus on domestic measures undermines a key advantage associated with international agreements: the ability to create a harmonised global set of rules.
In this post, I explore the scope of the CBD COP Decision, new requirements and unresolved legal challenges for companies and database managers. I argue for legal certainty and international legal harmonisation on DSI, including through possible linkages with other instruments.
Scope of Decision 16/2
The CBD COP Decision invites companies benefitting ‘directly or indirectly’ from DSI to contribute either 1% of their profits or 0.1% of their revenue to the ‘Cali Fund.’ The Decision identifies the pharmaceutical and biotechnological industries among the sectors benefiting from DSI and, thus, subject to benefit-sharing. Meanwhile, ‘public databases, academic, and public research institutions are not expected to make monetary contributions to the global fund.’
The Annex of the CBD COP Decision, which includes the modalities for operationalising the multilateral benefit-sharing mechanism, specifies that it applies to DSI that is ‘made publicly available, in compliance with national legislation.’ The wording allows State Parties to continue to regulate access to DSI at the national level, by making it subject to mutually agreed terms that would limit its public availability.
The funding raised through the Cali Fund will be distributed to countries for the conservation and sustainable use of biodiversity, with at least 50% allocated to the ‘self-identified needs of indigenous peoples and local communities.’ Additional contributions, including non-monetary benefits such as capacity-building, technical and scientific cooperation, are encouraged.
It is worth noting that the CBD COP Decision is not binding under international law and lacks enforcement mechanisms to ensure compliance and payments. Instead, the Decision invites Parties and non-Parties to ‘take administrative, policy or legislative measures … to incentivise users in their jurisdiction to contribute to the Cali Fund in line with the modalities.’ Below, I examine the new requirements and challenges for database managers and healthcare companies arising from the Decision.
Navigating the new requirements
For database managers
DSI is shared on specialised databases, such as DDBJ, ENA, GenBank, GISAID, which form part of a constellation of 3000 open and private databases. Given the complexity of the database landscape—arising from the specialisation necessary to support life sciences research—Decision 16/2 promotes database interconnection and open science rather than isolating any particular subset of data. Nevertheless, it does envisage new requirements for databases.
The Decision expects entities operating such databases to inform users about ABS commitments, including the potential requirement to contribute to the Cali Fund in cases of commercial use of DSI, as well as relevant national and international laws. These entities should ensure that information on the DSI’s country of origin, associated metadata, and any related traditional knowledge is submitted in alignment with open science principles. Additionally, they should require DSI submitters to confirm that the submitted data is free from restrictions that would prohibit sharing.
Traditionally, databases have focused on supporting scientific R&D, operating under minimalist policies that often do not involve data access or user agreements. Given the vast scale of regulating thousands of databases, it is unlikely that database managers are fully aware of the requirements envisaged under the CBD COP Decision. Without enforcement of the CBD COP Decision, compliance will remain voluntary, though subject to increasing international pressure. However, if Decision 16/2 is incorporated into binding legislation, database operators may become legally required to meet the above-described requirements, though as a matter of domestic law. As a result, entities managing these databases will likely need to invest more resources in navigating and ensuring compliance with relevant legal frameworks.
For pharmaceutical and biotech companies
DSI plays a crucial role in the research and development of health products, particularly in the context of mRNA technologies and advancements in synthetic biology. The CBD COP Decision adopts a sectoral approach, designating the pharmaceutical and biotechnological industries as sectors subject to benefit-sharing.
As long as benefit-sharing remains voluntary and is not legally mandated, companies will consider whether to contribute to the Cali Fund as part of their ESG investments. However, if the CBD COP Decision is incorporated into national legislation, companies will have to navigate the legal landscape and ensure compliance with benefit-sharing requirements, potentially across multiple jurisdictions.
It is unclear whether the criterion to contribute either 1% of profits or 0.1% of revenue will apply to a company’s overall corporate revenues and profits or to specific activities benefitting from DSI. Given the sheer scale at which DSI is used—with commercial R&D often involving searches of millions of sequences potentially falling under various jurisdictions and international instruments—it may prove impossible to separate business activities for the purpose of benefit-sharing under the CBD mechanism. On the other hand, demanding companies to contribute 1% of their global profits or 0.1% of revenue in the form of an international levy is likely to be perceived as a burden on high-risk pharmaceutical R&D.
Industry could be incentivised to contribute by ensuring transparency and legal certainty. According to the CBD COP Decision, companies will receive a receipt for their contributions to the Cali Fund. Once they make monetary contributions in line with the modalities of Decision 16/2, they will also receive a certificate testifying that they have fairly and equitably shared benefits arising from the use of DSI. However, that certificate only applies to DSI within the scope of CBD COP benefit-sharing mechanism and only excludes the user from ‘any expectation’ to share further monetary benefits under that mechanism for that year. Such phrasing lacks the ability to absolve companies of other international obligations related to DSI and fails to provide legal certainty, particularly in the context of pathogen ABS being discussed across multiple international and national legal regimes.
Therefore, it remains unclear how double payments under different regimes could be effectively avoided. Below, I explore how the different legal regimes could interact to ensure legal certainty.
Linkage with the Pandemic Agreement and other instruments
DSI is broadly understood to cover ‘sequence information,’ also discussed in the context of the Pandemic Agreement. This brings us to the inter-institutional linkages envisaged by the CBD COP decision and the need for harmonisation between different legal regimes.
Paragraph 27 of Decision 16/2 states that the ‘multilateral mechanism will be implemented in a way that is mutually supportive of and adaptive to other international ABS instruments on digital sequence information, to avoid the stacking of obligations.’ The Decision also excludes from its scope any DSI covered by another international instrument that ensures fair and equitable benefit-sharing, unless that instrument explicitly opts to use the CBD multilateral mechanism for this purpose.
While the primary focus of contributions under Decision 16/2 will likely be on biodiversity conservation and sustainable use, in line with CBD objectives, the Decision also allows for the possibility of supporting other objectives if other fora choose it as their benefit-sharing mechanism.
One such international regime is the Pathogens Access and Benefit-Sharing System (PABS), which is currently under discussion as part of the Pandemic Agreement. If PABS establishes a benefit-sharing system that is deemed fair and equitable through an internationally agreed process, then the sequence data covered by PABS would fall outside the scope of the CBD COP Decision, unless PABS explicitly chooses to channel benefits through the Cali Fund. This could potentially be achieved by linking PABS’s requirement for ‘annual monetary contributions’ to the Cali Fund, a decision that could be made by the COP of the Pandemic Agreement once, and if, it enters into force.
However, the meaning of what constitutes ‘fair and equitable’ sharing of benefits, as well as the question of who decides whether it has been achieved, has been the subject of extensive analysis and debate, without a clear policy conclusion. The designation of a specialised international access and benefit-sharing instrument for this purpose is established under Article 4.4 of the Nagoya Protocol on Access and Benefit-sharing (2010), a supplementary agreement to the CBD, rather than under the CBD itself, raising doubts about how conflicts between different regimes can be resolved without clear legal rules to that end.
The situation is further complicated by the complexity of domestic legislation on the topic. There are reportedly ‘at least 100 distinct ABS laws around the world’ including 39 that apply to DSI. This already creates challenges for companies and is likely to impose higher transaction costs on businesses unless there is international harmonisation.
With rapid access to data and health products being essential for effective public health responses, negotiators of the Pandemic Agreement should coordinate with the CBD to ensure international legal certainty when establishing the PABS for pathogens with pandemic potential. One way to achieve this is by agreeing on a defined list of pathogens or pathogen families covered by PABS and designating the Pandemic Agreement as lex specialis for the purposes of ABS for those pathogens. This approach would exempt specific pathogens from the CBD’s benefit-sharing system and national legislation, enabling benefit-sharing tailored to health needs, which could include in-kind donations of health products, scientific acknowledgments and collaborations.
To incentivise industry, certificates issued under the CBD benefit-sharing mechanism should be recognised as proof of compliance with benefit-sharing obligations under both international and national laws. Furthermore, regarding the expectation for databases to indicate ‘the use of traditional knowledge associated with genetic resources and its origin or source,’ collaboration with the WIPO Treaty on Intellectual Property, Genetic Resources, and Associated Traditional Knowledge (2024) should be established. This would ensure that the information required under the CBD benefit-sharing mechanism aligns with the requirements of the WIPO treaty, avoiding duplication and promoting legal coherence.
Conclusion
In conclusion, CBD COP Decision 16/2 creates an ambitious framework and a significant stepping stone for sharing DSI-related benefits. However, given the CBD’s call to continue exploring benefit-sharing modalities, Decision 16/2 is better seen as a new beginning rather than a last word on the topic.
The Decision’s success will depend on political support, especially from megadiverse and industry-hosting countries in a tense geopolitical environment. If the Cali Fund fails, the status quo of largely unregulated ABS may continue, with some states potentially restricting access to DSI at the national level, potentially disrupting scientific R&D. In another scenario, if the PABS system fails to materialise, the publicly available pathogen DSI is likely to fall under the scope of the CBD benefit-sharing mechanism.
In the future, States Parties to the CBD may also push for an internationally binding instrument on DSI benefit-sharing negotiated under the auspices of the CBD. A useful parallel is the ‘soft law’ Bonn Guidelines on Access to Genetic Resources and Fair and Equitable Sharing of Benefits (2002), which eventually led to the legally binding Nagoya Protocol.
This analysis underscores the importance of continued coordination between different legal regimes. It also highlights examples of how various systems can work together by establishing legal hierarchy and fostering collaboration based on their respective provisions. Without such efforts, we risk creating fragmented rules that may prove impossible to navigate for access and benefit-sharing purposes. This new beginning of DSI regulation must thus be followed up by a concerted effort to enhance communication and harmonisation across legal frameworks.
Adam Strobeyko is a Swiss National Science Foundation researcher at the Global Health Centre, Geneva Graduate Institute, and the Principal Investigator on a project concerning Access and Benefit Sharing for Genetic Sequence Data.
Acknowledgments: the author would like to thank Charlotte Germain-Aubrey, Kirsty Bryant, Amber Hartman Scholz, Bart Van Vooren, and Viviana Muñoz-Tellez for their thoughtful contributions to the webinar on the topic organised by the Global Health Centre, Geneva Graduate Institute and International Geneva Global Health Platform on 23 January 2025. Webinar recording is available here: Link. All views expressed in this post are solely those of the author.