SpeechHon Dr DAVID CLARK (Minister of Commerce and Consumer Affairs): Part 2 of the bill sets out exactly what rights a plant variety right (PVR) gives the breeder the exceptions to those rights and the term of duration of those rights. By aligning with the 1991 revision of the International Convention for the Protection of New Varieties of Plants UPOV-91 the bill significantly expands breeders' rights compared to the current legislation. And this of course is good for economic growth good for intellectual property development and has been the subject of some public debate about what the right terms of extension are. Research commissioned by the Ministry of Business Innovation and Employment during the review found that even under the current legislation the plant breeding innovation system in New Zealand is in pretty good shape. So I should note that from the outset. Under the current Act farmers do not have to pay to plant saved seed of protected varieties for the next season's crops. Under the broader exclusive rights in UPOV-91 reflected in the bill at clause 14 farmers would have to pay for this. However UPOV-91 permits countries to provide an exemption for farm-saved seed and the bill gives effect to this exemption so farmers do not have to pay royalties when they're using saved seed of a protected variety for that purpose. Some stakeholders have argued that this decreases the return on the investment in breeding new varieties and might hamper as a consequence innovation. The research did not find any evidence in New Zealand that we're missing out on innovative new crop varieties. I understand there are discussions going on between the relevant parties on this issue—Federated Farmers the New Zealand Plant Breeding and Research Association and United Wheat Growers. They are as I understand it ongoing conversations.To speak to the term of a PVR the term of a PVR broadly aligns with the minimum terms required by UPOV-91 which is 25 years for woody plants their rootstock and potatoes as well and 20 years for all other plants. There was considerable debate on this issue as I understand it during the select committee process. Getting intellectual property settings right is a balancing act. If rights are too weak New Zealand could be missing out on innovation. If they're too strong that can result in higher costs for users for consumers which outweigh any benefits from increasing innovation. Research again has not found any evidence that New Zealand has been missing out on innovative new plant varieties. The bill expands the exclusive rights of PVR owners and extends the PVR term for woody plants and rootstock to 25 years from the 23 years allowed for under the current Act. This has the potential to increase the returns that PVR owners earn from the new varieties. In light of this no case has been made to extend the PVR term beyond those required by UPOV-91. Indeed that could actually leave growers and consumers worse off because the increased benefits for rights holders will come at the cost of other groups. One exception to this is the PVR term for potatoes but this was because the Economic Development Science and Innovation Committee was presented with compelling evidence that a 20-year PVR term for potatoes was not long enough to allow breeders to recoup their investment in light of the long time period required to bring a new potato variety to market. A shorter PVR term could in time reduce the number of new potato varieties entering the market. I think that's a sufficient introduction to Part 2 and I look forward to some root and branch analysis of this part of the bill.