Biotech Values

[DewDiligence]

Setback Seen for EU Plan on Biotech Crops

[It’s unclear if the setback described here will end up helping or hurting ag-biotech companies such as MON. When the plan for individual-country opt-outs of biotech crops was floated in July (#msg-52340585), it seemed that it might help more crops get approved at the EU level since the approvals would not be binding at the country level. However, the thrust of the article below from the NY Times is that the opposite result may occur as EU-level regulators reestablish decision-making based on science rather than emotion.

Whatever the outcome may be, MON does not have any contribution from GM seeds in Europe in its short-term or long-term sales forecasts, so any upside is all gravy.]

http://www.nytimes.com/2010/11/11/business/global/11biotech.html

›November 10, 2010
By JAMES KANTER

BRUSSELS — An effort by the European Union to give power over biotechnology crops back to local authorities has run into serious legal problems — but it could end up strengthening the central regulator’s hand by resulting in more genetically engineered products being approved, despite public opposition.

One of the first things that the E.U. commissioner for health and consumer affairs, John Dalli, did after taking office early this year was to approve the planting of a genetically modified potato in Europe [#msg-48575063]. That was the first approval of its kind for a decade, and it angered many environmentalists.

Mr. Dalli then proposed a radical overhaul of the existing rules that would allow E.U. member states to reject biotech foods, even after they win approval at the E.U. level [#msg-52340585]. His goal was to make future approvals of biotech crops swifter and less acrimonious by effectively allowing countries to opt out.

But on Thursday, lawyers working on behalf of E.U. governments in Brussels were expected to issue a legal opinion concluding that the plan would violate European law and global trade rules.

Frédéric Vincent, a spokesman for Mr. Dalli, said that the commission’s own lawyers had reached a different opinion, and that Mr. Dalli would continue to push his proposal.

But with France and Germany already signaling strong reservations, some experts said Mr. Dalli might have to withdraw the plan and stick with the current system. Ironically, that could turn out be the best outcome for biotech companies.

“Unlike his predecessors, Mr. Dalli showed with the potato that he had no qualms about approving new biotech crops for cultivation judged safe on the evidence,” said Thijs Etty of Vrije Universiteit Amsterdam and an expert in biotech regulation.

“With many crops ready, or nearly ready, for final approval, we could have what represents an unprecedented avalanche of new biotech varieties growing in Europe within the next couple of years,” said Mr. Etty, who also serves as an academic expert on a biotech panel at the European Economic and Social Committee, an E.U. advisory body.

Among the crops that already have received safety approval from the authorities at the European Food Safety Authority are varieties of corn by Monsanto, Syngenta, Pioneer, and Dow AgroSciences.

Companies have made more than a dozen other applications for biotech crops, including two more varieties of potato, a second engineered by BASF, and another by a Dutch company called Avebe, as well as a sugar beet, developed jointly by Monsanto and KWS, a Germany company.

The only other biotech crop grown in Europe besides the potato, which is used mainly to produce starch for the paper industry, is a type of corn produced by Monsanto, which was approved in 1998.

Austria, Greece and Italy have consistently blocked approvals of biotech crops at the E.U. level to avoid being required to allow them to be planted at home.

Mr. Dalli’s proposals were designed to avoid this problem, by allowing countries to restrict or prohibit the cultivation of biotech crops on their territory on ethical grounds.

But according to the opinion to be issued Thursday, there are “strong doubts about the compatibility” of the proposal with E.U. treaties concerning the single market, as well as global trade agreements.

The commission has been seeking for years to ease tensions with Argentina, Canada and the United States, where modified crops are grown. Those countries won a lawsuit at the World Trade Organization in 2006 obliging Europe to ease remaining bans on the import and cultivation of genetically modified products. The United States still could impose punitive duties on the Europeans for continuing to block trade.‹