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Agricultural, Forestry and Fisheries Law Practice Team Newsletter
Atsumi & Sakai's Agricultural, Forestry and Fisheries Law Practice Team (AFFL Team) consists of four lawyers and one advisor, each of whom has
different strengths and provides a wide variety of high quality legal services in the areas of agriculture, forestry, and fisheries (”AFF”) ranging from support
for overseas transactions and overseas expansion (or closure), drafting and reviewing agreements for complex purchase and sale transactions,licensing and other intellectual property rights, communications with authorities (such as the Fair Trade Commission), and dispute resolution.

Legal Framework for Protection of Livestock Genetic Resources(Act on Prevention of Unfair Competition Regarding Livestock Genetic Resources, Act forAmendment of the Act on Improvement and Increased Production of Livestock)| Page 1/6 |April 2021 No.AFFL_006

Amendment of laws affecting the livestock industry in the 2020 ordinary Diet session
1. Bill enacted in the 201st session of the Diet
At the time of writing of this newsletter, the 202nd (extraordinary)Diet session had just closed [1]. In the 201st (ordinary) Diet session,
the following three bills (outlined in (1) - (3) below) affecting the
livestock industry were enacted. This newsletter will provide a brief
explanation of bills (1) and (2).
(1) Act on Prevention of Unfair Competition regarding Livestock
Genetic Resources [2]and even though there is a significant need to protect the outcome,the livestock could easily be distributed in a manner different fromthe intention of the developer. [3] Recently, there have been reportsof cases where semen from brand beef cattle was transported toChina in straws [4] and the limitations of the protection available
under the existing legal framework have been highlighted, and so
the Act on Prevention of Unfair Competition regarding Livestock
Genetic Resources was enacted, and the Unfair Competition Prevention
Act [5] and the Act on Improvement and Increased Production ofLivestock were amended [6].

As the value of livestock genetic resources as an asset has increased
following improvements made over several years, the Act aims toprotect such resources as intellectual property and prevent thewrongful acquisition of livestock genetic resources by prohibiting actsof unfair competition and by introducing civil injunctions. Measures
to restore credibility, as well as criminal penalties, were introduced.
(2) Act for Partial Amendment of the Act on Improvement andIncreased Production of Livestock
In addition to the protection of intellectual property described in (1)above, this Act established new rules for the distribution of semen
and fertilized eggs for artificial insemination of livestock from theviewpoint of protection of livestock genetic resources, and introduced
administrative dispositions and criminal penalties for violations of the
new rules.
(3) Act for Partial Revision of the Act on Domestic Animal Infectious
Diseases Control
In response to the detection of swine fever (hog cholera) in Japan,
the Act establishes legal measures to prevent African swine fever(ASF), which is currently spreading in East Asia, from entering Japan.

2. Background of the amendments
There are several famous Japanese beef breeds, which were developed
through many years of breeding and improvements by people engaged
in breed improvements. The act of developing livestock with certain
characteristics through repeated breeding is an intellectual activity,--[1] In terms of laws concerning the agriculture, forestry and fisheries industries,
the recent extraordinary Diet session enacted the Plant Variety Protectionand Seed Act, which had been a pending issue, as well as the Improvementof Domestic Trade of Specific Marine Animals and Plants Act.
[2] The effective date of the Act on Prevention of Unfair Competition regarding
Livestock Genetic Resources is October 1, 2020 (Cabinet Order Specifying
the Effective Date of the Act on Prevention of Unfair Competition regarding
Livestock Genetic Resources (Cabinet Order No. 289 of 2020)).
[3] If the relationship is limited to being between the developer of the breed
and the transferee, it is possible to contractually agree on measures toprevent the outflow of the breed to external third parties.
[4] By 1998, 247 live cattle and 13,000 straws of semen had been exported
from Japan to the United States, where they were raised and then exported
to Australia. Overseas production of Japanese beef similar to authentic
Japanese beef is possible by backcrossing.
[5] "Interim Report" by the Expert Committee on Strengthening the Protectionof the Intellectual Property Value of Japanese Beef Genetic Resources(January 28, 2020) (https://www.maff.go.jp/j/press/seisan/c_sinko/200128.html)[6] "Expert Committee on Strengthening the Protection of the Intellectual
Property Value of Japanese Beef Genetic Resources" interim report(January 28, 2020) (https://www.maff.go.jp/j/study/wagyu_iden/wagyu_
iden.html)

| Page 2/6 |April 2021 No.AFFL_006

3. Contents of the Act on Prevention of Unfair
Competition regarding Livestock Genetic Resources
While registration-type rights such as patent rights and trademark
rights are not suitable for livestock due to variations in the abilities
among individuals belonging to a specific breed and the offspring they
produce, improved breeds have accumulated useful genetic information
through the livestock improvement process, which is why a framework
was adopted to regulate and prohibit certain acts as illegal acts, modeled
after the regulations on unauthorized use of results under the Unfair
Competition Prevention Act. [7] At the time of writing of this newsletter,
livestock genetic resources protected by said Act were (i) the JapaneseBlack, (ii) the Japanese Brown, (iii) the Japanese Shorthorn, (iv) theJapanese Polled, (v) hybrids between (i) - (iv), and (vi) semen for
artificial insemination of livestock and fertilized eggs of livestock ofbreeds (i) - (v) and hybrids of (v). [8]Under said Act, if the operating profit of a "Livestock Genetic Resource
Producer" is infringed or is likely to be infringed by "unfair competition",such producer may demand the suspension or prevention of infringement(the right to demand an injunction; Article 3, paragraph 1 of the Act).
In addition, in the case where a party infringes the operating profit
of another party by "unfair competition" as defined in said Act (Article
4 of the Act), it is possible to claim compensation for damage suffered
as the result of such infringement. These concepts are outlined below.

In relation to A above, the Ministry of Agriculture, Forestry and
Fisheries has published a notice on the Internet that includes very
simple standard terms and conditions for the transfer of semen, etc.
for artificial insemination of livestock [10]. It is expected that therequirements of A will be fulfilled by publishing these standard terms
and conditions online and providing that users of semen, etc. forartificial insemination of livestock or fertilized eggs of livestock agree
to comply with said terms and conditions [11]. In addition, it has beenannounced on the Ministry of Agriculture, Forestry and Fisheries
website that the indication "(R)" is sufficient for the Abbreviation. [12](2) Acts of "Unfair Competition" subject to claim for injunction orcompensation for damage
The following acts (i) through (xiii) fall under "Unfair Competition".
In simple terms, and broadly speaking “unfair competition” is the actof illegally acquiring or using (meaning use, transfer, delivery or
export) livestock genetic resources in a manner that exceeds contractual
limits. Furthermore, unfair competition also is defined to include theuse of livestock produced with livestock genetic resources to produce
further livestock or semen or fertilized eggs.

(1) "Livestock genetic resources" subject to protection"Livestock genetic resources" refers to semen, etc. for specific livestock
artificial insemination that is transferred or delivered for business by
livestock genetic resource producers, for which restrictions on thescope of users or the purpose of use are clearly indicated throughcertain acts such as contracts (Article 2, paragraph 1 of the Act). [9]"Restrictions on the scope of users or the purpose of use" must be
clearly indicated by contract or other acts stipulated in the Ordinancefor Enforcement of the Act, where the three following methods are
specified in addition to contracts.
(A) Preparing provisions to be used as the content of contracts
for the purpose of transfering or delivering, the semen, etc. forartificial insemination of specific livestock (including individual
provisions of standard terms and conditions as provided in the
Civil Code) for business and publicizing such restrictions on
the internet or by other appropriate methods.
(B) Indicating restrictions on a certificate of semen for artificial
insemination of livestock, certificate of internal fertilized egg
of livestock, or certificate of external fertilized egg of livestock
based on the new/amended Act on Improvement and Increased
Production of Livestock.
(C) Indicating restrictions with letters, figures or symbols, ora combination thereof (hereinafter referred to as an "Abbreviation")widely recognized as an indication that there are restrictions,on containers containing semen, etc. for artificial inseminationof specific livestock.

--[7] There are no international conventions (such as the UPOV Convention
for seeds and seedlings) to protect the genetic resources of livestock.
[8] The four breeds in (i)-(iv) are breeds improved in Japan exclusively for
their meat.
[9] Livestock genetic resource producers are business operators engaged
in the production of livestock genetic resources (Article 2, paragraph(2) of the Act).
[10] "Examples of terms and conditions of a transfer agreement for semen
for livestock artificial insemination (contract template)" https://www.
maff.go.jp/j/chikusan/kikaku/attach/pdf/kachiku_iden-30.pdf)[11] The standard terms and conditions prepared and published by the
Ministry of Agriculture, Forestry and Fisheries are simple. However,careful consideration seems to be necessary in terms of whether the
standard terms and conditions are intended to disallow amendments
to the standard provisions as necessary in so-called business-to-business
relationships.
[12] "Clarification of Restrictions by Means Other than Contracts" (https://www.maff.go.jp/j/chikusan/kikaku/attach/pdf/kachiku_iden-35.pdf)

| Page 3/6 |April 2021 No.AFFL_006(i)Acquiring livestock genetic resources by fraud, assault,
intimidation, theft or embezzlement in the pursuit of business(hereinafter collectively referred to as "Fraudulent Acquisition");(ii) Using, transfering, delivering or exporting livestock genetic
resources acquired or obtained by Fraudulent Acquisition;(iii) Acquiring livestock genetic resources or using, transfering,delivering or exporting such acquired livestock genetic resources,
with the knowledge that a Fraudulent Acquisition has occurredwith regard to such livestock genetic resources, or when failingto know the same due to gross negligence;(iv) Using, transfering, delivering or exporting livestock genetic
resources in a manner exceeding the restrictions on the scopeof users or the purpose of use clearly indicated in the contract
pertaining to the transfer or delivery of such livestock genetic
resources, for the purpose of wrongful gain or causing damage
to a livestock genetic resource producer after the transfer ordelivery of such livestock genetic resources;(x) Using, transferring, delivering or exporting a fertilized egg
produced by the party's own Act of Illegal Use;(xi) Acquiring a fertilized egg, or using, transferring, delivering orexporting such acquired fertilized egg with the knowledge thatthe fertilized egg is the result of an Act of Illegal Use by anotherparty, or while failing to know the same due to gross negligence;(xii) Transferring, delivering or exporting livestock that is the resultof the party's own acts which fall under any of those listed in(x) or (xi) (limited to using fertilized eggs); and(xiii) Acquiring livestock or transfering, delivering or exporting suchacquired livestock with the knowledge that the livestock is theresult of acts which fall under any of those listed in (x) or (xi)(limited to using fertilized eggs.) by another party, or while
failing to know the same due to gross negligence.

(3) Provisions regarding other court proceedings(v) Acquiring livestock genetic materials by receiving transfer ordelivery thereof while knowing that such transfer or delivery
falls under the acts listed in (iv) above (limited to transfer ordelivery of livestock genetic resources; hereinafter referred
to as "Unauthorized Transfer, etc. Outside of Contract"),or while failing to know the same due to gross negligence,acquiring livestock genetic resources while knowing that there
has been an Unauthorized Transfer, etc. Outside of Contract
with regard to such livestock genetic resources,or while failingto know the same due to gross negligence; and using, transfering,delivering or exporting livestock genetic resources that havebeen acquired by any of the foregoing acts;(vi) Making available, transfering, delivering or exporting livestock
produced by the party's own acts which fall under any of thoselisted in (ii) through (v) (limited to use of livestock genetic
resources; hereinafter referred to as "Act of Illegal Use") forthe purpose of producing livestock or livestock's semen or
fertilized eggs (hereinafter referred to as "Livestock, etc.");(vii) Acquiring livestock or making available, transfering, delivering
or exporting such acquired livestock for the purpose of
production of Livestock, etc. with the knowledge that such
livestock is the result of an Act of Illegal Use by another party,
or while failing to know the same due to gross negligence;(viii) Transferring, delivering or exporting Livestock, etc. producedby the party's own acts which fall under any of those listed in(vi) and (vii) (limited to making livestock available for the
production of Livestock, etc.);(ix) Acquiring Livestock, etc. or transferring, delivering or exporting
such aquired Livestock, etc. with the knowledge that theLivestock, etc. is the result of acts which fall under any of
those listed in (vi) or (vii) by another party (limited to making
livestock available for the production of Livestock, etc.), or
while failing to know the same due to gross negligence;

Provisions regarding other court proceedings equivalent to those of
the Unfair Competition Prevention Act were established, including
provisions on the presumption of amount of damage (Article 5),
presumption of use of livestock genetic resources by persons who
have acquired livestock genetic resources (Article 6), and in camera
procedures (Article 7).
(4) Criminal penalties
Certain acts, such as the Fraudulent Acquisition of livestock genetic
resources to earn wrongful gains, are subject to criminal penalties(imprisonment with work of no more than 10 years or a fine of no
more than 10 million yen). In the case of a representative, etc. of acorporation, the corporation may be subject to a fine of no morethan 300 million yen.
Criminal penalties may also be applied even if the counterparty uses
livestock genetic resources outside Japan, and therefore foreignbusiness operators also need to pay attention to the possibility of
extraterritorial application (Article 18, paragraph 1, item 11).

(5) Jurisdiction
As Article 6-2 (Jurisdiction over an Action Involving a Design Right)of the Code of Civil Procedure is applicable, the Tokyo District Courtis recognized to have jurisdiction if a district court in eastern Japan
has jurisdiction, and the Osaka District Court is recognized to havejurisdiction if a district court in western Japan has jurisdiction, on acase-by-case basis.

| Page 4/6 |April 2021 No.AFFL_006

4. Act for Amendment of the Act on Improvement
and Increased Production of Livestock(C) Matters to be stated in the transfer, etc. register
The transfer, etc. register shall be prepared in the form
prescribed by the Ministry of Agriculture, Forestry and Fisheries
and preserved for 10 years, and must contain descriptions of
the date of transfer, receipt, disposal or loss, matters concerning
the other party, the amount of semen or eggs for livestock
artificial insemination that wastransferred, etc., and the certificate
number, etc. of semen or eggs for livestock artificial inseminationthat was transferred, etc. (Article 32-5 of the Act on Improvement
and Increased Production of Livestock).

As mentioned above, a new law has been introduced to protect
livestock genetic resources as intellectual property, yet it must be
said that it would be difficult to take action after livestock genetic
resources have been transported to a foreign country due to thesignificant hurdles to conducting court proceedings overseas.
Therefore, the Act on Improvement and Increased Production ofLivestock was amended to strengthen the distribution managementof livestock genetic resources. Important amendments include
the following:(D) Annual reports to prefectural governors by livestock artificial
insemination facilities(A) Prohibition of transfer of livestock genetic resources from entities
other than livestock artificial insemination facilities, etc.[13]Any person who establishes a livestock artificial insemination
facility must submit annual reports of the details of theiroperations, etc. to prefectural governors. The reports must include
the volume of semen for the artificial insemination of specificlivestock received, transferred, and stored (Article 34, paragraph
3 of the Act on Improvement and Increased Production ofLivestock). The content of the report will be notified to the
Ministry of Agriculture, Forestry and Fisheries (paragraph 5of the same Article).

As a result of this amendment, it was stipulated that semen for
artificial insemination of livestock and fertilized eggs of livestock
not preserved in a livestock artificial insemination facility, etc.
shall not be transferred to others, and the transfer of semen etc.
from a farmer who has not obtained permission to establish alivestock artificial insemination facility to another farmer wasprohibited (Article 14, paragraph 3 of the Act on Improvement
and Increased Production of Livestock).
(B) Labeling on containers containing semen or eggs for artificial
insemination of specific livestockContainers of semen for artificial insemination of livestock shallhave an indication of (a) the name etc. of the male livestockfrom which it was collected and (b) the date of collection, andcontainers of fertilized livestock eggs shall have an indication of(c) the record number of the livestock artificial insemination
facility that collected or produced the semen, etc. for artificial
insemination of livestock, (d) the names or the individual
identification numbers of the egg providing cattle and breeding
stock pertaining to the livestock fertilized eggs, and (e) the dateof production (note that (d) and (e) can be substituted with
the number of the certificate of internal fertilized egg of livestockor the certificate of external fertilized egg of livestock) (Article
32-4 of the Act on Improvement and Increased Production ofLivestock).

5. Conclusion
Since the amount of genetic resources of Japanese beef that has
already been transported to foreign countries is not small, preventing
any future outflow is thought to be a meaningful endeavor. At thesame time, there are hopes that the fundamental perception of thegenetic resources of Japanese beef as intellectual property (rather
than perceiving semen in a straw as a mere tangible object) will expand.
--[13] Livestock artificial insemination facilities, livestock hygiene facilities,
and other facilities established by the National Livestock Breeding
Center or prefectures for the purpose of performing livestock artificial
inseminations or the transplantation of livestock fertilized eggs (Article
12, paragraph 1 of the Act on Improvement and Increased Productionof Livestock).

| Page 5/6 |April 2021 No.AFFL_006

Team of Agriculture, Forestry and Fisheries Law
Yasuhiro Usui

[Author]Partner
Admitted Japan (2007)

Hisashi Miyatsuka
Partner
Admitted Japan (1996)

Go Fujimoto
Partner
Admitted Japan (2003),New York (2011),
and California (2011, inactive)

Fumiko Oikawa
Partner
Admitted Japan (2003) and New York (2017)

Keio University (LL.B., 2004)
University of Pennsylvania (LL.M., 2015)
Atsumi & Sakai (2007-)
Seconded to a seed and pesticide manufacturer (2016-2017)
Seconded to Cool Japan Fund Inc. (2017-2018)
E-mail: yasuhiro.usui@aplaw.jp

Kyoto University (LL.B., 1994)
Nishimura & Asahi (2007-2017)
Atsumi & Sakai (2017-)
E-mail: hisashi.miyatsuka@aplaw.jp

The University of Tokyo (LL.B., 1995)
University of Pennsylvania Law School (LL.M., 2010)
Sheng Wo Law Firm (2012-2013)
Dacheng Law Offices, Shanghai Office (2013-2014)
Nishimura & Asahi (2014-2017)
Atsumi & Sakai (2017-）
E-mail: go.fujimoto@aplaw.jp
Gakushuin University (LL.B., 1997; LL.M., 2000)
University of Michigan Law School (LL.M., 2013)
Atsumi & Sakai (2003-)
Mayer Brown LLP (New York) (2013-2014)
E-mail: fumiko.oikawa@aplaw.jp

General Inquiries:
Yasuhiro Usui (Team of Agriculture, Forestry and Fisheries Law, Atsumi & Sakai)
Tel: 03-5501-2111 | E-mail: cpg_affl@aplaw.jp

This memorandum was prepared by Japanese lawyers (Bengoshi) at Atsumi & Sakai and is provided as a general guide only; it does not constitute, and should not be
relied on as constituting legal advice.
Please see notice 2. below regarding any subsequent Japanese law advice.

| Page 6/6 |April 2021 No.AFFL_006

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1. About Atsumi & Sakai
Atsumi & Sakai is a partnership consisting of Atsumi & Sakai Legal Professional Corporation, a Japanese professional corporation, a foreign law joint venture underthe Act on Special Measures Concerning the Handling of Legal Services by Foreign Lawyers with certain Registered Foreign Lawyers of our firm, a Japanese Civil Codepartnership among Japanese lawyers, represented by Yutaka Sakai, a lawyer admitted in Japan, and a foreign law joint venture with Janssen Foreign Law Office, represented
by Markus Janssen, a foreign lawyer registered in Japan to advise on the laws of the Federal Republic of Germany. In addition to lawyers admitted in Japan, our firm
includes foreign lawyers registered in Japan to advise on the laws of the US States of New York and California, the People’ s Republic of China, Taiwan, India, Englandand Wales, and the State of Queensland, Australia. Foreign lawyers registered in Japan to advise on state laws also are qualified to provide advice in Japan on the federal
laws of their respective jurisdictions.
Atsumi & Sakai has established an office in London operating as Atsumi & Sakai Europe Limited (a company incorporated in England and Wales (No: 09389892); sole
director Naoki Kanehisa, a lawyer admitted in Japan), and has established an office in New York operating as Atsumi & Sakai New York LLP (a limited liability partnershipestablished in New York; managing partner Bonnie L. Dixon, a lawyer admitted in New York and a Registered Foreign Lawyer in Japan). We also have an office inFrankfurt operating as Atsumi Sakai Janssen Rechtsanwalts- und Steuerberatungsgesellschaft mbH, a German legal and tax advisory professional corporation (local
managing directors: Frank Becker, a lawyer, and Miyuki Hanaoka a tax advisor, both admitted in the Federal Republic of Germany).
2. Legal Advice
Japanese legal advice provided by Atsumi & Sakai and our global offices is provided by lawyers admitted in Japan. Advice provided in Tokyo in respect of any foreign
law on which one of our foreign lawyers is registered in Japan to advise, may be provided by such a Registered Foreign Lawyer. None of Atsumi & Sakai Legal
Professional Corporation, Atsumi & Sakai Europe Limited or Mr. Naoki Kanehisa is regulated by the Solicitors Regulation Authority for England and Wales, and none
will undertake any reserved legal activity as defined in the United Kingdom Legal Services Act 2007. Advice provided in Germany on the laws of Germany will be
provided by a lawyer admitted in Germany, and advice provided in New York on the laws of New York will be provided by a lawyer admitted in New York.

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