Indian Biological Diversity Act, 2002 and its salient features, access and benefit sharing

India is a Party to the Convention on Biological Diversity (CBD). To fulfil

commitments of the Convention on Biological Diversity, India enacted act known as
Biological Diversity Act, 2002 and The Biological Diversity Rules, 2004. Biological
Diversity Act received the assent of the President on the 5th February, 2003. The Biodiversity
Act - 2002 primarily addresses access to genetic resources and associated knowledge by
foreign individuals, institutions or companies, to ensure equitable sharing of benefits arising
out of the use of these resources and knowledge to the country and the people. The Act has
specific provisions about ownership of intellectual property rights associated with
exploitation of biodiversity. Industries have to obtain prior consent of the National
Biodiversity Authority before exploring the biodiversity in India. In the event of R&D based
on exploitation of biodiversity and associated local knowledge, there is a provision for
sharing of benefits of such work with the local community. No direct flow of funds is
expected to the community. Instead the Union Government will reach the benefits through
State Governments to the community.

Various states have also enacted state specific Biological diversity rules namely -
Kerala Biological Diversity Rules, 2005; Sikkim State Biological Diversity Rules, 2006;
Nagaland Biological Diversity Rules, 2010; Rajasthan Biological Diversity Rules, 2010; A.P.
State Biological Diversity Rules, 2009, West Bengal Biological Diversity Rules, 2005; U.P.
State Biodiversity Rules, 2010; Maharashtra Biological Diversity Rules, 2008 etc.

Objectives:

 Conservation of biological diversity

 Sustainable use of components of biological diversity
 Fair and equitable sharing of the benefits arising out of the use and knowledge of
biological resources
 To address other matters connected with biological diversity.

Overall view of the act:

The Biological diversity Act of 2002 contains 65 sections under 12 chapters while the
Biological Diversity Rules of 2004 consists of 24 rules and one schedule.

The Act provides for a three tier structure for regulation and access to Biological Diversity.

1) National Biodiversity Authority (NBA): All matters relating to requests for access by
foreign individuals, institutions or companies, and all matters relating to transfer of results of
research to any foreigner will be dealt with by the National Biodiversity Authority.

2) State Biodiversity Boards (SBB): All matters relating to access by Indians for
commercial purposes will be under the purview of the State Biodiversity Boards (SBB). The
Indian industry will be required to provide prior intimation to the concerned SBB about the
use of biological resource. The State Board will have the power to restrict any such activity,
which violates the objectives of conservation, sustainable use and equitable sharing of
benefits.

3) Biodiversity Management Committees (BMCs): Institutions of local self government

will be required to set up Biodiversity Management Committees in their respective areas for
conservation, sustainable use, and documentation of biodiversity and chronicling of
knowledge relating to biodiversity. NBA and SBBs are required to consult the concerned
BMCs on matters related to use of biological resources and associated knowledge within their
jurisdiction.

The act is in form of chapters, which are discussed below:

For detail of Biological Diversity Act, 2002 see link:
http://www.wipo.int/wipolex/en/text.jsp?file_id=185798)
And for detail of Biological Diversity Rules, 2004 see link:
http://www.wipo.int/edocs/lexdocs/laws/en/in/in047en.pdf

CHAPTER –I (Title and Definitions)

 Short title: Biological Diversity Act, 2002.
Definitions
 Benefit claimers: The conservers of biological resources, their by products, creators
and holders of knowledge and information relating to the use of such biological
resources, innovations and practices associated with such use and application.

 Biological diversity: Variability among living organisms from all sources. It includes
diversity within species or between species and of eco-systems.

 Biological resources: Plants, animals and micro-organisms or parts thereof, their

genetic material and by-products (excluding value added products) but does not
include human genetic material.

 Bio-survey and bio-utilization: Survey or collection of species, subspecies, genes,

components and extracts of biological resource for any purpose and includes
characterization, inventorisation and bioassay.

 Commercial utilization: End uses of biological resources for commercial utilization

such as drugs, industrial enzymes, food flavours, fragrance, cosmetics, emulsifiers,
oleoresins, colours, extracts and genes used for improving crops and livestock through
genetic intervention, but does not include conventional breeding or traditional
practices in use in any agriculture, horticulture, poultry, dairy farming, animal
husbandry or bee keeping.

 Sustainable use: The use of components of biological diversity in such manner and at
such rate that does not lead to the long-term decline of the biological diversity thereby
maintaining its potential to meet the needs and aspirations of present and future
generations.

CHAPTER –II (Regulation of Access to Biological Diversity)

 1. Certain persons not to undertake Biodiversity related activities without approval
of National Biodiversity Authority are

 A person who is not a citizen of India;

 A citizen of India, who is a non-resident as per section 2(30) of the Income-tax
Act, 1961;
 A body corporate, association or organization not incorporated or a body
corporate, association or organization registered in India which has any non-
Indian participation in its share capital or management.

2. Results of research not to be transferred to certain persons without approval of

National Biodiversity Authority.

3. Prior intimation to State Biodiversity Board for obtaining biological resource for
certain purposes.

CHAPTER –III (National Biodiversity Authority)

In exercise of the powers conferred by Biological Diversity Act, 2002, the Central
Government has established a body called the National Biodiversity Authority, with effect
from October 1, 2003. The head office of the National Biodiversity Authority is at Chennai.
The Chairperson is the Chief Executive of the National Biodiversity Authority.

The National Biodiversity Authority members

 A Chairperson, who shall be an eminent person having adequate knowledge and

experience in the conservation and sustainable use of biological diversity to be
appointed by the Central Government;
 Three ex-officio members to be appointed by the Central Government, one
representing the Ministry dealing with Tribal Affairs and two representing the
Ministry dealing with Environment and Forests of whom one shall be the Additional
Director General of Forests or the Director General of Forests.
  Seven ex officio members to be appointed by the Central Government to represent
respectively the Ministries of the Central Government.

Conditions of service of Chairperson and members

The term of office and conditions of service of the Chairperson and the other
members other than ex officio members of the National Biodiversity Authority shall be
prescribed by the Central Government.

Removal of members
The Central Government may remove from the National Biodiversity Authority any
member who, in its opinion, has
(a) been adjudged as an insolvent;
(b) been convicted of an offence which involves moral turpitude;
(c) become physically or mentally incapable of acting as a member;
(d) so abused his position as to render his continuance in office detrimental to the
public interest;
(e) acquired such financial or other interest as is likely to affect prejudicially his
functions as a member.

CHAPTER –IV (Functions and Powers of the National Biodiversity Authority)

The main functions of the Authority are:
 Regulation of acts prohibited under the Act
 Advise the Government on conservation of biodiversity
 Advise the Government on selection of biological heritage sites
 Take appropriate steps to oppose grant of intellectual property rights in foreign
countries, arising from the use of biological resources or associated traditional
knowledge

CHAPTIER –V (Approval by the National Biodiversity Authority)

 To obtain any biological resource occurring in India or associated knowledge for

research or for commercial utilization or for bio-survey and bio-utilization or transfer
the results of any research relating to biological resources occurring in, or obtained
from, India, shall make application to the National Biodiversity Authority.
  Any person who intends to apply for a patent or any other form of intellectual
property protection in India or outside India may make an application to the National
Biodiversity Authority.
 The National Biodiversity Authority shall give public notice of every approval
granted by it.
 Determination of equitable benefit sharing by National Biodiversity Authority.
 The National Biodiversity Authority shall ensure that the terms and conditions subject
to which approval is granted secures equitable sharing of benefits arising out of the
use of accessed biological resources, their by-products, innovations and practices
associated with their use and applications and knowledge relating thereto in
accordance with mutually agreed terms and conditions between the person applying
for such approval, local bodies concerned and the benefit claimers.
 The benefit sharing shall be in form of grant of joint ownership of intellectual
property rights
 Location of production, research and development units in such areas which will
facilitate better living standards to the benefit claimers;
 Setting up of venture capital fund for aiding the cause of benefit claimers;
 Payment of monetary compensation and non-monetary benefits to the benefit claimers
as the National Biodiversity Authority may deem fit.

CHAPTER –VI (State Biodiversity Board)

State Government may, established board for the purposes of this Act, a Board for the
State to be known as the (name of the State) Biodiversity Board.
No State Biodiversity Board shall be constituted for a Union territory. For Union
territory, the National Biodiversity Authority shall exercise the powers and perform the
functions.

Members of SBB

1. Chairperson who shall be an eminent person having adequate knowledge and experience
in the conservation and sustainable use of biological diversity and in matters relating to
equitable sharing of benefits He is appointed by the State Government;
2. Not more than five ex-officio members to be appointed by the State Government to
represent the concerned Departments of the State Government;

3. Not more than five members to be appointed from amongst experts in matters relating to
conservation of biological diversity.

The place of head office of the State Biodiversity Board is decided by the State Government

Functions of State Biodiversity Board

1. To advise the State Government on related matters.

2. Granting of approvals for commercial utilization or bio-survey and bio-utilization of
any biological resource by Indians;

CHAPER –VII (Finance, Accounts and Audit of National Biodiversity Authority)

1. Grants or loans will be provided by the Central Government

2. All the grants received will be credited to National Biodiversity Fund

The Fund shall be used for–

 To provide benefits to the benefit claimers;
 Conservation and promotion of biological resources and development of areas
for biological resources and associated knowledge.
 Socio-economic development of areas of biological diversity

3. Budget accounts and audit

 The National Biodiversity Authority prepares a budget, maintain proper accounts and
other relevant records and prepare an annual statement of account.
 The accounts of the National Biodiversity Authority are audited by the Comptroller
and Auditor-General of India.

4. Annual report is prepared and laid before parliament.

CHAPTER –VIII (Finance, Accounts and Audit of State Biodiversity Board)
 1. Grants of money are provided by State Government.
2. On the pattern of National Biodiversity Fund, State Biodiversity Fund is constituted.

The State Biodiversity Fund shall be applied for

 Management and conservation of heritage sites;

 Compensating or rehabilitating any section of the people economically
affected by notification under act;
 Conservation and promotion of biological resources;
 Socio-economic development of areas from where such biological resources
or knowledge associated has been accessed
 Meeting the expenses incurred for the purposes authorized by this Act.

3. Audit of accounts of State Biodiversity Board is done by Accountant-General of the

State.
4. Annual Report of State Biodiversity Board is prepared and laid before State
Legislature

CHAPTER –IX (Duties of the Central and the State Governments)

 The Central Government shall develop national strategies, plans, programmes for the
conservation and promotion and sustainable use of biological diversity identification
and monitoring of areas rich in biological resources.
 Promotion of in situ, and ex situ, conservation of biological resources.
 Incentives for research, training and public education to increase awareness with
respect to biodiversity.
 Issue directives to the concerned State Government to take ameliorative measures,
where the Central Government believes that any area rich in biological diversity,
biological resources and their habitats is being threatened by overuse, abuse or
neglect,
 To regulate, manage or control the risks associated with the use and release of living
modified organisms resulting from biotechnology likely to have adverse impact on
the conservation and sustainable use of biological diversity and human health.
 CHAPTER –X (Biodiversity Management Committees)

 Every local body shall constitute a Biodiversity Management Committee within its
area for the purpose of conservation, sustainable use and documentation of biological
diversity
 The National Biodiversity Authority and the State Biodiversity Boards shall consult
the Biodiversity Management Committees while taking any decision relating to the
use of biological resources and knowledge associated with such resources occurring
within the territorial jurisdiction of the Biodiversity Management Committee.
 The Biodiversity Management Committees may levy charges by way of collection
fees from any person for accessing or collecting any biological resource for
commercial purposes from areas falling within its territorial jurisdiction.

CHAPTER –XI (Local, Biodiversity Fund)

 Grants to Local Biodiversity Fund: The State Government may pay to the Local
Biodiversity Funds by way of grants or loans

 Constitution of Local Biodiversity Fund: All the grants received are credited to this
fund.
 Application of Local Biodiversity Fund: The Fund shall be used for conservation
and promotion of biodiversity in the areas falling within the jurisdiction of the
concerned local body and for the benefit of the community in so far such use is
consistent with conservation of biodiversity.

 Annual Report of Biodiversity Management Committees are prepared.

 Audit of accounts of Biodiversity Management Committees: The accounts of the

Local Biodiversity Fund shall be maintained and are audited by the Accountant-
General of the State.

 Annual report, etc, of the Biodiversity Management Committee are to be submitted to

district Magistrate.

CHAPTER –XII (Miscellaneous)

National Biodiversity Authority to be bound by the directions given by Central Government

Settlement of disputes between State Biodiversity Boards: If a dispute arises between the
National Biodiversity Authority and a State Biodiversity Board, the said Authority or the
Board, may prefer an appeal to the Central Government.

Members, officers, etc., of National Biodiversity Authority and State Biodiversity Board
deemed to be public servants.

Penalties: If a person, violates the regulatory provisions he will be "punishable with

imprisonment for a term which may extend to five years, or with fine which may extend to
ten lakh rupees and where the damage caused exceeds ten lakh rupees such fine may
commensurate with the damage caused, or with both.

Any offence under this Act is non-bailable and cognizable.

Power of Central Government to give directions to State Government: The Central

Government may give directions to any State Government as to the carrying into execution in
the State of any of the provisions of this Act
.
Power of Central Government to make rules:The Central Government may' by notification
in the Official Gazette, make rules for carrying out the purposes of this Act.

Power of State Government to make rules:The State Government may, by notification in

the Official Gazette, make rules for carrying out the purposes of this Act.

Power to remove difficulties: If any difficulty arises in giving effect to the provisions of this
Act, the Central Government may, remove the difficulty:
 Biological Diversity Rules, 2004

(Came into force on 15th April, 2004)

Rule 3 Manner of selection and appointment of the Chairperson: Appointed by

Central Govt. Through deputation from Central Govt. Or through selection from
outside central Govt., not be below
the rank of Additional Secretary to the Government of India.
Rule 4. Term of Office of the Chairperson: Three years’ and shall be eligible for re-
appointment or upto the age of 65 years.
Rule5. Pay and Allowances of Chairperson:To be decided by the Central
Government from time to time.
Rule 6. Term of Office and Allowances of non-official Members: Three years +
allowances as per govt. rules.
Rule 7. Filling up vacancies of non-official members: Non official member can
resign at any time during his tenure and vacant post is filled by nomination by govt.
for reaming period of time.
Rule 8. Removal of the members of the Authority: No member of the Authority
shall be removed from his office without a due and proper enquiry.
Rule 9. Secretary of the Authority: The Authority shall appoint a Secretary to it.
The terms and conditions of the appointment shall be determined by the Authority
and he shall be responsible for coordinating and convening the meetings of the
Authority, maintenance of the records of the proceedings of the Authority.
Rule 10. Meetings of the Authority: After a period of three months and not less than
4 times in a year.
Rule 11. Appointment of Expert Committee by the Authority and their
entitlements: Authority can constitute committees of its members and or other
persons.
Rule 12. General functions of the Authority: Already discussed in act.
Rule 13. Powers and duties of Chairperson: Full powers on financial,
administrative and technical matters.
Rule 14. Procedure for access to biological resources and associated traditional
knowledge:
 Any person seeking approval of the Authority for access to biological
resources and associated knowledge for research or for commercial utilization
shall make an application to authority.
  Every application under shall be accompanied by a fee of ten thousand
rupees.
 The Authority shall after consultation with the concerned local bodies
shalldispose of the application, as far as possible, within a period of six
months from the date of its receipts.
 On being satisfied with the merit of the application, the Authority may grant
the approval for access to biological resources and associated knowledge.
 The approval to access shall be in the form of a written agreement duly signed
by the authorized officer of the Authority and the applicant.
 The form of the agreement referred shall be laid down by the Authority and
shall include some terms and conditions.
Rule 15. Revocation of access or approval: If provisions of act are violated or
person fails to comply the terms and conditions of the act, the authority can withdraw
the approval granted.
Rule 16. Restriction on activities related to access to biological resources: The
authority can restrict the access to biological resources due to the reasons like, if
access is requested for endangered species, has adverse effect of livelihood of local
community, adverse effect on environment or causes genetic erosion and against
national interest of international agreements.
Rule 17. Procedure for seeking approval for transferring results of research:
Same procedure as Rule no. 14. Fee in this case is Rs. 5000 and application is
disposed within 3 months.
Rule 18. Procedure for seeking prior approval before applying for intellectual
property protection: Same as rule no. 17.
Rule 19. Procedure for third party transfer: The persons who have been granted
approval for access to biological resources and associated knowledge, intend to
transfer the accessed biological resource or knowledge to any other person or
organization shall make an application to the Authority. Same procedure as Rule no.
14.
Rule 20. Criteria for equitable benefit sharing:
 The Authority shall by notification in the Official Gazette formulate the
guidelines and describe the benefit sharing formula.
 The guidelines shall provide for monetary and other benefits such as royalty,
joint ventures, technology transfer, product development, education and
 awareness raising activities, institutional capacity building and venture capital
fund.
 The formula for benefit sharing shall be determined on a case-by-case basis.
 The quantum of benefits shall be mutually agreed upon between the persons
applying for such approval and the Authority in consultation with the local
bodies and benefit claimers.
 Five percent of the assessed benefits shall be earmarked for the Authority or
Board as the case may be, towards the administrative and service charges.
 The Authority shall monitor the flow of benefits.

Rule 21. Application of National Biodiversity Fund:

Rule 22. Constitution of Biodiversity Management Committees

Rule 23. Appeal for settlement of disputes: Appeal is made to the Secretary,
Ministry of Environment and Forests, Government of India.

Rule 24. Manner of giving notice:

 If the alleged offense has taken place in a Union territory, notice shall be given
to the
Chairperson of the National Biodiversity Authority.
 If the alleged offence has been taken place in a State, notice is given to the
Chairperson of the State Biodiversity Board.

Salient Features of the Biological Diversity Act - 2002:

• To conserve, sustainable use, regulate access and equitable share in benefits of biological
resources of the country act has been formulated.

• Setting up of National Biodiversity Authority (NBA), State Biodiversity Board (SBB) and
Biodiversity Management Committee’s. (BMC’s) is important feature of the act.

• Provision is provided to secure sharing of benefits with local people as conservers of

biological resources and holders of knowledge and information relating to the use of
biological resources.

• All foreign nationals / organizations require prior approval of NBA for obtaining biological
resources and / or associated knowledge for use.

• Indian scientists / individuals require approval of NBA for transferring results of research to
foreign nationals / organizations.
• Indian Industry needs prior intimation to SBB to obtain bioresource. SBB has right to
restrict if found to violate conservation and sustainable use and benefit sharing.

• Conservation and development of areas of importance related to biological diversity by

declaring them as biological diversity heritage sites.

• Protection of threatened species and rehabilitation of people affected by conservation is

provided by law.

• Involvement of institutions of State Government for implementation of the Biological

Diversity Act through constitution of committees is done.

• Provisions for notifying heritage sites by State Government in consultation with local body.

• Creation of National, State and Local Biodiversity Fund and its use for conservation of
biodiversity.