UK: Burnt To A Crisp! - Controller Refuses Compulsory Licence For Protected Potato Variety

Last week, the Controller of Plant Variety Rights refused the first compulsory licence application lodged under The Plant Varieties Act 1997.

The challenge was to a variety of potato "Lady Rosetta", popularly used in crisp manufacture. Dutch seed breeder, C. Meijer BV owns the UK plant breeders' rights in "Lady Rosetta", with MBM Produce Limited acting as its exclusive agent in the UK. Sacker Potatoes Limited applied (unsuccessfully) for compulsory exploitation rights in the protected variety, arguing that Meijer's refusal to issue a licence was unreasonable and that the rights' holder was failing to satisfy demand in the UK market.

Section 17 of the Act sets out the criteria for a compulsory licence application. The Controller may only grant an application on the basis that the rights' holder has unreasonably refused (or put forward unreasonable terms) to grant a licence if she is satisfied that:

• it is necessary to secure that the variety is: available to the public at reasonable prices; widely distributed; or maintained in quality;
• the applicant is financially and otherwise in a position to exploit the variety in a competent and businesslike manner; and
• the applicant intends to so exploit those rights.

The Controller must also have regard to the fact that rights' holder is entitled to secure reasonable remuneration from exploiting its intellectual property rights (in practice, to ensure adequate funding for on-going or new breeding programs or to finance the development, trialling and marketing of existing or new plant varieties).

After protracted proceedings, the matter came for final consideration by the Controller, Mrs Heather Hamilton of DEFRA's Plant Varieties and Seeds Division. After acknowledging the evidence cited on both sides, the Controller found that insufficient evidence had been adduced by the applicant to demonstrate that the rights' holder had unreasonably refused to grant a licence to the applicant.

Herbert Smith was successful in acting for Meijer/MBM in resisting the grant of a compulsory licence. Herbert Smith has long-established expertise in the field of plant breeders' rights and also acted in the majority of applications brought under the old legislation.

"© Herbert Smith 2002

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