EXPLANATORY MEMORANDUM

The Convention on Biological Diversity (CBD), which entered into force on 29 December 1993, is today's main international instrument for addressing biodiversity issues. The three objectives pursued by the Convention are the conservation of biological diversity, the sustainable use of its components, and the fair and equitable sharing of benefits arising from the use of genetic resources.

Biosafety, one of the issues addressed by the Convention, concerns the need to protect human health and the environment from the potential adverse effects of the products of modern biotechnology.

The Conference of the Parties to the Convention on Biological Diversity (COP), at its second meeting, held in November 1995 pursuant to Article 19, paragraph 3 of the CBD, established an Open-ended Ad Hoc Working Group on Biosafety to develop a draft protocol on biosafety, specifically focusing on transboundary movement of any living modified organism. The Working Group held six meetings between July 1996 and February 1999.

The Cartagena Protocol on Biosafety to the Convention on Biological Diversity was adopted on 29 January 2000 as a supplementary agreement to the CBD and entered into force on 11 September 2003. This international treaty provides a framework, based on the precautionary principle, for the safe transfer, handling and use of living modified organisms (LMOs) resulting from modern biotechnology that may have adverse effects on the conservation and sustainable use of biological diversity, or pose risks to human health.

Article 27 of the Cartagena Protocol mandated the Conference of the Parties serving as the Meeting of the Parties (COP/MOP) to establish at its first meeting a formal process with respect to the appropriate elaboration of international rules and procedures on liability and redress for damage resulting from transboundary movements of LMOs, with a view to endeavour to conclude this work within 4 years (i.e. by 2008).

During COP/MOP1, held in Kuala Lumpur from 23 to 27 February 2004, an Ad Hoc Open-ended Working Group of Legal and Technical Experts on Liability and Redress in the context of the Cartagena Protocol on Biosafety was established to analyse issues, elaborate options, and propose international rules and procedures on the subject.

In May 2008, the COP/MOP4, held in Bonn, achieved a political breakthrough in the negotiations, although it did not finalise the drafting of the agreed results. Therefore, the Parties agreed to work on the completion of a legally binding instrument at COP/MOP5 in Nagoya, Japan in October 2010, as well as to develop guidelines on civil liability. This legally binding instrument, largely inspired by the EU Environmental Liability Directive (ELD)[1], would allow national authorities to act on behalf of the collective good and ask operators for remedial measures in case of damage to biodiversity from LMOs, a novelty particularly in many developing countries.

Final negotiations on the legally binding instrument and on the civil liability guidelines took place in a "Friends of the Co-Chairs" (FoC) group involving 26 of 157 Parties to the Cartagena Protocol, as well as advisors from other Parties. The EU had two seats at the negotiating table. The Commission acted as the EU negotiator for the legally binding instrument on the basis of a formal authorisation adopted by the Council in June 2007 and extended in time after COP/MOP4. The negotiating directives were refined various times and instructed the Commission to ensure that the results of the negotiation are consistent with relevant Union legislation and with the basic principles of Member States' law on liability and redress, and that it could be implemented in the EU without introducing or amending substantive rules on civil liability.

On 15 October 2010, as a result of final negotiations in Nagoya, the plenary of COP/MOP5 successfully adopted an international agreement, known as the "Nagoya-Kuala Lumpur Supplementary Protocol on Liability and Redress to the Cartagena Protocol on Biosafety"[2].

The COP/MOP5 decision adopting the Nagoya-Kuala Lumpur Supplementary Protocol calls upon the Parties to the CBD to sign the Protocol at the earliest opportunity and to deposit instruments of ratification, acceptance or approval or instruments of accession, as appropriate, as soon as possible.

On 20 December 2010, the Council welcomed the adoption of the Nagoya-Kuala Lumpur Protocol[3] and on 11 May 2011 the European Union signed the Supplementary Protocol.

In the European Union, the provisions of the Cartagena Protocol on Biosafety are covered by the European legislation on Biosafety which is maintaining as a central cornerstone the precautionary principle. The liability provisions of the Nagoya-Kuala Lumpur Supplementary Protocol are covered by the Directive 2004/35/CE of the European Parliament and of the Council of 21 April 2004, on environmental liability with regard to the prevention and remedying of environmental damage, which establishes a framework based on the "polluter pays" principle, according to which the polluter pays when environmental damage occurs. After the Directive entered into force on 30 April 2004, three years were given to the EU Member States (MS) to transpose the Directive in domestic law. By July 2010, the last MS finalised its transposition. The ELD was already amended twice through Directive 2006/21/EC on the management of waste from extractive industries and through Directive 2009/31/EC on the geological storage of carbon dioxide and amending several directives.

Any protocol to the Convention on Biological Diversity, pursuant to Article 34 thereof, is open for ratification, acceptance or approval by Member States and by regional economic integration organisations. In accordance with Article 34, paragraph 3, of the Convention, regional economic integration organisations must declare the extent of their competence with respect to the matters governed by the relevant protocol. To fulfill this obligation, the Commission has prepared the Declaration annexed to the present proposal.

In accordance with the advisory opinion of the Court of Justice[4], the Decision on the conclusion should be based on Article 192 (1) TFEU, in conjunction with Article 218(6)(a) TFEU (.

In view of the above the Commission proposes that the Council authorizes the President to designate the person(s) empowered to deposit the instrument of approval of the Nagoya-Kuala Lumpur Supplementary Protocol on behalf of the Union and to confer on them the necessary powers thereto.

2012/0120 (NLE)

Proposal for a

COUNCIL DECISION

on the conclusion of the Nagoya-Kuala Lumpur Supplementary Protocol on Liability and Redress to the Cartagena Protocol on Biosafety

(Text with EEA relevance)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article 192, in conjunction with Article 218(6) (a) thereof,

Having regard to the proposal from the European Commission,[5]

Having regard to the consent of the European Parliament, [6]

Whereas:

(1) Article 27 of the Cartagena Protocol on Biosafety bound the first meeting of the Conference of the Parties serving as the Meeting of the Parties to the Protocol (COP/MOP) to initiate a process with respect to the elaboration of international rules and procedures in the field of liability and redress for damage resulting from transboundary movements of living modified organisms.

(2) In June 2007, the Council adopted a Decision authorising the Commission to participate in the liability and redress negotiations on behalf of the Union as regards matters falling within Union competence, in accordance with certain negotiating directives. That authorisation was extended in October 2008 to cover the final stages of the negotiations.

(3) On 11 October 2010, during the fifth Conference of the Parties serving as the Meeting of the Parties to the Protocol in Nagoya, Japan, the EU unanimously supported the final compromise reached on the Nagoya-Kuala Lumpur Supplementary Protocol on Liability and Redress, following consideration that it was within the limits of the agreed EU positions and negotiating directives addressed to the Commission.

(4) On 15 October 2010, the final plenary of COP/MOP5 successfully adopted the Nagoya-Kuala Lumpur Supplementary Protocol on Liability and Redress to the Cartagena Protocol on Biosafety.

(5) On 20 December 2010, the Council welcomed the adoption of the Nagoya-Kuala Lumpur Supplementary Protocol.

(6) In accordance with Council Decision of 6 May 2011[7], the Nagoya-Kuala Lumpur Supplementary Protocol on Liability and Redress to the Cartagena Protocol on Biosafety was signed by the Union on 11 May 2011, subject to its conclusion at a later date.

(7) According to Article 34 of the Convention on Biological Diversity, any protocol to that Convention is subject to ratification, acceptance or approval by States and by regional economic integration organisations.

(8) The Nagoya-Kuala Lumpur Supplementary Protocol on Liability and Redress to the Cartagena Protocol on Biosafety contributes to the achievement of the objectives of the environmental policy of the Union. It is therefore appropriate that this Protocol be concluded on behalf of the Union as soon as possible.

(9) The agreement should be approved on behalf of the European Union.

HAS ADOPTED THIS DECISION:

Article 1

The Nagoya-Kuala Lumpur Supplementary Protocol on Liability and Redress to the Cartagena Protocol on Biosafety is hereby approved on behalf of the Union.

The text of the Agreement is attached to this Decision.

Article 2

The President of the Council shall designate the person empowered to proceed, on behalf of the European Union, to the deposit of the instrument of approval provided for in Article 18 of the Agreement, in order to express the consent of the European Union to be bound by the Agreement. The deposit of the instrument of approval shall take place simultaneously with those of the Member States. At the same time, the designated person shall deposit the declaration set out in the Annex to this Decision, in accordance with Article 34(3) of the Convention on Biological Diversity.

Article 3

This Decision shall be published in the Official Journal of the European Union.

Done at Brussels,

For the Council

The President

ANNEX

DECLARATION BY THE EUROPEAN UNION IN ACCORDANCE WITH ARTICLE 34 (PARAGRAPH 3) OF THE CONVENTION ON BIOLOGICAL DIVERSITY

"The European Union declares that, in accordance with the Treaty on the Functioning of the European Union, and in particular Article 191 thereof, it is competent for entering into international agreements, and for implementing the obligations resulting therefrom, which contribute to the pursuit of the following objectives:

– preserving, protecting and improving the quality of the environment;

– protecting human health;

– prudent and rational utilisation of natural resources;

– promoting measures at international level to deal with regional or worldwide environmental problems, including climate change.

Moreover, the European Union adopts measures at European Union level in the area of judicial cooperation in civil matters for the proper functioning of its internal market

The European Union declares that it has already adopted legal instruments, binding on its Member States, covering all matters governed by this Protocol.

[1] Directive 2004/35/CE of the European Parliament and of the Council of 21 April 2004 on environmental liability with regard to the prevention and remedying of environmental damage

[2] http://bch.cbd.int/protocol/NKL_text.shtml

[3] See Council Conclusions "Convention on Biological Diversity: outcome of and follow-up to the Nagoya Conference (11-29 October 2010)" of 20 December 2010, paragraph 2.

[4] ECJ Opinion 2/2000, 6 December 2001.

[5] …

[6] …

[7] Decision not yet published

ANNEX

to the Proposal for a Decision of the European Parliament and of the Council on the conclusion of the Nagoya-Kuala Lumpur Supplementary protocol on Liability and Redress to the Cartagena Protocol on Biosafety

Text of the Agreement NAGOYA-KUALA LUMPUR SUPPLEMENTARY PROTOCOL ON LIABILITY AND REDRESS TO THE CARTAGENA PROTOCOL ON BIOSAFETY

The Parties to this Supplementary Protocol,

Being Parties to the Cartagena Protocol on Biosafety to the Convention on Biological Diversity, hereinafter referred to as “the Protocol”,

Taking into account Principle 13 of the Rio Declaration on Environment and Development,

Reaffirming the precautionary approach contained in Principle 15 of the Rio Declaration on Environment and Development,

Recognizing the need to provide for appropriate response measures where there is damage or sufficient likelihood of damage, consistent with the Protocol,

Recalling Article 27 of the Protocol,

Have agreed as follows:

Article 1 Objective

The objective of this Supplementary Protocol is to contribute to the conservation and sustainable use of biological diversity, taking also into account risks to human health, by providing international rules and procedures in the field of liability and redress relating to living modified organisms.

Article 2 Use of terms

1. The terms used in Article 2 of the Convention on Biological Diversity, hereinafter referred to as “the Convention”, and Article 3 of the Protocol shall apply to this Supplementary Protocol.

2. In addition, for the purposes of this Supplementary Protocol:

(a) “Conference of the Parties serving as the meeting of the Parties to the Protocol” means the Conference of the Parties to the Convention serving as the meeting of the Parties to the Protocol;

(b) “Damage” means an adverse effect on the conservation and sustainable use of biological diversity, taking also into account risks to human health, that:

(i) Is measurable or otherwise observable taking into account, wherever available, scientifically-established baselines recognized by a competent authority that takes into account any other human induced variation and natural variation; and

(ii) Is significant as set out in paragraph 3 below;

(c) “Operator” means any person in direct or indirect control of the living modified organism which could, as appropriate and as determined by domestic law, include, inter alia, the permit holder, person who placed the living modified organism on the market, developer, producer, notifier, exporter, importer, carrier or supplier;

(d) “Response measures” means reasonable actions to:

(i) Prevent, minimize, contain, mitigate, or otherwise avoid damage, as appropriate;

(ii) Restore biological diversity through actions to be undertaken in the following order of preference:

a. Restoration of biological diversity to the condition that existed before the damage occurred, or its nearest equivalent; and where the competent authority determines this is not possible;

b. Restoration by, inter alia, replacing the loss of biological diversity with other components of biological diversity for the same, or for another type of use either at the same or, as appropriate, at an alternative location.

3. A “significant” adverse effect is to be determined on the basis of factors, such as:

(a) The long-term or permanent change, to be understood as change that will not be redressed through natural recovery within a reasonable period of time;

(b) The extent of the qualitative or quantitative changes that adversely affect the components of biological diversity;

(c) The reduction of the ability of components of biological diversity to provide goods and services;

(d) The extent of any adverse effects on human health in the context of the Protocol.

Article 3 Scope

1. This Supplementary Protocol applies to damage resulting from living modified organisms which find their origin in a transboundary movement. The living modified organisms referred to are those:

(a) Intended for direct use as food or feed, or for processing;

(b) Destined for contained use;

(c) Intended for intentional introduction into the environment.

2. With respect to intentional transboundary movements, this Supplementary Protocol applies to damage resulting from any authorized use of the living modified organisms referred to in paragraph 1 above.

3. This Supplementary Protocol also applies to damage resulting from unintentional transboundary movements as referred to in Article 17 of the Protocol as well as damage resulting from illegal transboundary movements as referred to in Article 25 of the Protocol.

4. This Supplementary Protocol applies to damage resulting from a transboundary movement of living modified organisms that started after the entry into force of this Supplementary Protocol for the Party into whose jurisdiction the transboundary movement was made.

5. This Supplementary Protocol applies to damage that occurred in areas within the limits of the national jurisdiction of Parties.

6. Parties may use criteria set out in their domestic law to address damage that occurs within the limits of their national jurisdiction.

7. Domestic law implementing this Supplementary Protocol shall also apply to damage resulting from transboundary movements of living modified organisms from non-Parties.

Article 4 Causation

A causal link shall be established between the damage and the living modified organism in question in accordance with domestic law.

Article 5 Response measures

1. Parties shall require the appropriate operator or operators, in the event of damage, subject to any requirements of the competent authority, to:

(a) Immediately inform the competent authority;

(b) Evaluate the damage; and

(c) Take appropriate response measures.

2. The competent authority shall:

(a) Identify the operator which has caused the damage;

(b) Evaluate the damage; and

(c) Determine which response measures should be taken by the operator.

3. Where relevant information, including available scientific information or information available in the Biosafety Clearing-House, indicates that there is a sufficient likelihood that damage will result if timely response measures are not taken, the operator shall be required to take appropriate response measures so as to avoid such damage.

4. The competent authority may implement appropriate response measures, including, in particular, when the operator has failed to do so.

5. The competent authority has the right to recover from the operator the costs and expenses of, and incidental to, the evaluation of the damage and the implementation of any such appropriate response measures. Parties may provide, in their domestic law, for other situations in which the operator may not be required to bear the costs and expenses.

6. Decisions of the competent authority requiring the operator to take response measures should be reasoned. Such decisions should be notified to the operator. Domestic law shall provide for remedies, including the opportunity for administrative or judicial review of such decisions. The competent authority shall, in accordance with domestic law, also inform the operator of the available remedies. Recourse to such remedies shall not impede the competent authority from taking response measures in appropriate circumstances, unless otherwise provided by domestic law.

7. In implementing this Article and with a view to defining the specific response measures to be required or taken by the competent authority, Parties may, as appropriate, assess whether response measures are already addressed by their domestic law on civil liability.

8. Response measures shall be implemented in accordance with domestic law.

Article 6 Exemptions

1. Parties may provide, in their domestic law, for the following exemptions:

(a) Act of God or force majeure; and

(b) Act of war or civil unrest.

2. Parties may provide, in their domestic law, for any other exemptions or mitigations as they may deem fit.

Article 7 Time limits

Parties may provide, in their domestic law, for:

(a) Relative and/or absolute time limits including for actions related to response measures; and

(b) The commencement of the period to which a time limit applies.

Article 8 Financial limits

Parties may provide, in their domestic law, for financial limits for the recovery of costs and expenses related to response measures.

Article 9 Right of recourse

This Supplementary Protocol shall not limit or restrict any right of recourse or indemnity that an operator may have against any other person.

Article 10 Financial security

1. Parties retain the right to provide, in their domestic law, for financial security.

2. Parties shall exercise the right referred to in paragraph 1 above in a manner consistent with their rights and obligations under international law, taking into account the final three preambular paragraphs of the Protocol.

3. The first meeting of the Conference of the Parties serving as the meeting of the Parties to the Protocol after the entry into force of the Supplementary Protocol shall request the Secretariat to undertake a comprehensive study which shall address, inter alia:

(a) The modalities of financial security mechanisms;

(b) An assessment of the environmental, economic and social impacts of such mechanisms, in particular on developing countries; and

(c) An identification of the appropriate entities to provide financial security.

Article 11 Responsibility of States for internationally wrongful acts

This Supplementary Protocol shall not affect the rights and obligations of States under the rules of general international law with respect to the responsibility of States for internationally wrongful acts.

Article 12 Implementation and relation to civil liability

1. Parties shall provide, in their domestic law, for rules and procedures that address damage. To implement this obligation, Parties shall provide for response measures in accordance with this Supplementary Protocol and may, as appropriate:

(a) Apply their existing domestic law, including, where applicable, general rules and procedures on civil liability;

(b) Apply or develop civil liability rules and procedures specifically for this purpose; or

(c) Apply or develop a combination of both.

2. Parties shall, with the aim of providing adequate rules and procedures in their domestic law on civil liability for material or personal damage associated with the damage as defined in Article 2, paragraph 2 (b):

(a) Continue to apply their existing general law on civil liability;

(b) Develop and apply or continue to apply civil liability law specifically for that purpose; or

(c) Develop and apply or continue to apply a combination of both.

3. When developing civil liability law as referred to in subparagraphs (b) or (c) of paragraphs 1 or 2 above, Parties shall, as appropriate, address, inter alia, the following elements:

(a) Damage;

(b) Standard of liability including strict or fault-based liability;

(c) Channelling of liability, where appropriate;

(d) Right to bring claims.

Article 13 Assessment and review

The Conference of the Parties serving as the meeting of the Parties to the Protocol shall undertake a review of the effectiveness of this Supplementary Protocol five years after its entry into force and every five years thereafter, provided information requiring such a review has been made available by Parties. The review shall be undertaken in the context of the assessment and review of the Protocol as specified in Article 35 of the Protocol, unless otherwise decided by the Parties to this Supplementary Protocol. The first review shall include a review of the effectiveness of Articles 10 and 12.

Article 14 Conference of the Parties serving as the meeting of the Parties to the Protocol

1. Subject to paragraph 2 of Article 32 of the Convention, the Conference of the Parties serving as the meeting of the Parties to the Protocol shall serve as the meeting of the Parties to this Supplementary Protocol.

2. The Conference of the Parties serving as the meeting of the Parties to the Protocol shall keep under regular review the implementation of this Supplementary Protocol and shall make, within its mandate, the decisions necessary to promote its effective implementation. It shall perform the functions assigned to it by this Supplementary Protocol and, mutatis mutandis, the functions assigned to it by paragraphs 4 (a) and (f) of Article 29 of the Protocol.

Article 15 Secretariat

The Secretariat established by Article 24 of the Convention shall serve as the secretariat to this Supplementary Protocol.

Article 16 Relationship with the Convention and the Protocol

1. This Supplementary Protocol shall supplement the Protocol and shall neither modify nor amend the Protocol.

2. This Supplementary Protocol shall not affect the rights and obligations of the Parties to this Supplementary Protocol under the Convention and the Protocol.

3. Except as otherwise provided in this Supplementary Protocol, the provisions of the Convention and the Protocol shall apply, mutatis mutandis, to this Supplementary Protocol.

4. Without prejudice to paragraph 3 above, this Supplementary Protocol shall not affect the rights and obligations of a Party under international law.

Article 17 Signature

This Supplementary Protocol shall be open for signature by Parties to the Protocol at the United Nations Headquarters in New York from 7 March 2011 to 6 March 2012.

Article 18 Entry into force

1. This Supplementary Protocol shall enter into force on the ninetieth day after the date of deposit of the fortieth instrument of ratification, acceptance, approval or accession by States or regional economic integration organizations that are Parties to the Protocol.

2. This Supplementary Protocol shall enter into force for a State or regional economic integration organization that ratifies, accepts or approves it or accedes thereto after the deposit of the fortieth instrument as referred to in paragraph 1 above, on the ninetieth day after the date on which that State or regional economic integration organization deposits its instrument of ratification, acceptance, approval, or accession, or on the date on which the Protocol enters into force for that State or regional economic integration organization, whichever shall be the later.

3. For the purposes of paragraphs 1 and 2 above, any instrument deposited by a regional economic integration organization shall not be counted as additional to those deposited by member States of such organization.

Article 19 Reservations

No reservations may be made to this Supplementary Protocol.

Article 20 Withdrawal

1. At any time after two years from the date on which this Supplementary Protocol has entered into force for a Party, that Party may withdraw from this Supplementary Protocol by giving written notification to the Depositary.

2. Any such withdrawal shall take place upon expiry of one year after the date of its receipt by the Depositary, or on such later date as may be specified in the notification of the withdrawal.

3. Any Party which withdraws from the Protocol in accordance with Article 39 of the Protocol shall be considered as also having withdrawn from this Supplementary Protocol.

Article 21 Authentic texts

The original of this Supplementary Protocol, of which the Arabic, Chinese, English, French, Russian and Spanish texts are equally authentic, shall be deposited with the Secretary-General of the United Nations.

IN WITNESS WHEREOF the undersigned, being duly authorized to that effect, have signed this Supplementary Protocol.

DONE at Nagoya on this fifteenth day of October two thousand and ten.