C-305/00

The defendant in the main proceedings is 1 — Original language: Spanish. Mr Schulin, who is a farmer. 2 — Council Regulation of 27 July 1994 (OJ 1994 L 227, p. 1), amended by Council Regulation No 2506/95 of 25 October 1995 (OJ 1995 L 258, p. 3). The amendments do not affect the content of the provisions whose interpretation is requested in these preliminary reference proceedings. 4 — Quintana Carlo, I., 'El Reglamento CE número 2100/94, 3 — Commission Regulation of 24 July 1995 (OJ 1995 L 173, relativo a la protección comunitaria de las obtenciones p. 14). The Commission has adopted implementing rules on vegetales', in Actas de Derecho industrial y Derecho de two other occasions: in Regulation (EC) No 1238/95 of Autor, Volume XVI, 1994-95, Marcial Pons, Madrid, 1996, 31 May 1995 establishing rules for the application of p. 96. Regulation No 2100/94 as regards the fees payable to the 5 — Elena Roselló, J.M., 'Situación actual de la normativa legal Community Plant Variety Office (OJ 1995 L 121, p. 31) and en Europa y en América', in the book edited and coor- in Regulation (EC) No 1239/95 of 31 May 1995 establish- dinated by Nuez, F., Llácer, G. and Cuartero, J., Los ing implementing rules for the application of Regulation derechos de propiedad de las obtenciones vegetales. Minis- No 2100/94 as regards proceedings before that Office terio de Agricultura, Pesca y Alimentación, Madrid, 1998, (OJ 1995 L 121, p. 37). p. 88.

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3. The main proceedings arise out of the II — The question referred for a prelimi- request for information sent by Saatgut- nary ruling Treuhandverwaltung to Mr Schulin, asking whether he had exercised the agricultural exemption during the 1997/98 cropping season in respect of any of the 525 protected plant varieties which it listed, 6 and what amount of the product he had 6. In order to decide the appeal brought by used. Mr Schulin, the Oberlandesgericht Frank- furt am Main has asked the Court to reply to the following question:

9. The idea of introducing a specific indus- trial property right for that kind of inven- tion crystallised, as a result of various national initiatives, in the adoption of the International Convention for the Protection of New Varieties of Plants, which was signed on 2 December 1961 and has been in force since 10 August 1968. 10 The States 8. Until a few decades ago, however, that which were party to the Convention, which task was afforded no legal protection at all. originally numbered 10, constituted the The industrialisation of agriculture, which International Union for the Protection of took place in the developed countries from New Varieties of Plants (hereinafter the 1950s onwards, represented a turning 'UPOV'), an intergovernmental organi- point in that sphere as a result of the sation based in Geneva which, since that advances and improvements in new tech- time, has ensured that the Convention has niques, in particular, those relating to the been implemented properly. Although cultivation of hybrids (especially maize). some amendments had been made to it in Innovative work in the plant world became 1972 and 1978, it became clear in the particularly significant in agricultural deve- mid-1980s that the Convention needed to lopment and, in addition, took on a be reformed in order to adapt the legal financial relevance which was hitherto position to meet the challenges of the unknown. For that reason, it became so-called 'biotechnological revolution'. especially important to acknowledge the persons responsible for carrying out that work (breeders) 7and to grant them certain 8 — Opinion in Case 258/78 Nungesser v Commission [1982] exclusive rights. In those times — as Advo- ECR 2015, 2081 et seq., especially 2112. cate General Rozès pointed out in the 9 — Díaz Rodriguez, G., 'El punto de vista del sector empre- sarial', and in the book edited and coordinated by Nuez, F. and others, cited above, pp. 168 and 169 and 176 and 177: A new plant variety is obtained after many years of research (between 9 and 10). If the breeder is to benefit from the 7 — As Pollaud-Dulian, F. rightly points out in Droit de la investment he has made, which is usually considerable, he propriété industrielle, Montchrestien, Paris, 1999, p. 333, must be assured of a monopoly over the use of that plant Professor Calculus, the well-known character in Hergé's variety for a long period of time. By encouraging the work Adventures of Tintin, may be regarded as a forerunner in of breeders, it is sought to make available to farmers better the work of developing new plant varieties, since he creates qualify seeds giving better harvests for a lower investment. a new strain of rose, the 'Castafiore bianca' in The 10 — See the text of the original Convention and the amend- Castafiore Emerald, and blue oranges in the film Tintin ments made in 1972 and 1991 on www.upov.org (Texts of and the blue oranges. the UPOV Conventions. Acts of 1961, 1978 and 1991).

11 — Castro, E., 'La protección de las obtenciones de plantas mediante biotecnología', in the book edited and coor- dinated by Nuez, F. and others, cited above, p. 254, refers to the Bulletin of the European Federation of Biotech- 13. In recent years, the number of States nology N o 2 of 2 January 1994: 'Las técnicas de party to the UPOV Convention has grown modificación genética están siendo empleadas para lograr muchos de los mismos propósitos que el cultivo, la cría y considerably. It has increased from 20 los métodos de selección tradicionales, pero tienen dos ventajas principales. Primero, proporcionan los medios member States in 1992 to 50 in 2 0 0 1 , and para controlar la producción de genes con mucha mayor another 19 States or organisations are predicción y precisión que la que se obtiene con los métodos tradicionales. Segundo, hacen posible introducir negotiating entry. This development has copias de material genético en especies no relacionadas, lo que era imposible conseguir por técnicas tradicionales'. been aided by the appearance, in connec- ('Genetic modification techniques are being used to tion with the World Trade Organisation achieve many of the same objectives as traditional cultivation, breeding and selection methods, but they have (hereinafter 'WTO'), of the Agreement on two main advantages. Firstly, they provide the means of monitoring gene production with better forecasting and Trade-related Aspects of Intellectual Prop- greater accuracy than with traditional methods. Secondly, erty Rights (hereinafter 'the TRIPS Agree- they make it possible to introduce copies of genetic material into unrelated species, which was impossible to m e n t ' ) . 14 U n d e r t h a t a g r e e m e n t , all achieve using traditional techniques'). 12 — Convention on the Grant of the European Patent, in La Member States which belong to the W T O propriété industrielle, Volume 90, Organisation Mondiale are required to grant protection for plant de la Propriété Intellectuelle, 1974, p. 51 et seq. 13 — Ruiz, J.J. and Nuez, F., 'La propuesta de directiva del varieties either by means of patents, or by Parlamento Europeo y del Consejo relativa a la protección means of an effective system sui generis, or jurídica de las invenciones biotecnológicas', in the book edited and coordinated by Nuez, F. and others, cited above, p. 277, point out that previously the Strasbourg Convention of 1963 on the Unification of Certain Elements of Substantive Law on Patents for Invention 14 — The TRIPS Agreement is included as an annex to the had given Member States the option of not affording Marrakesh Agreement of 15 April 1994 establishing the protection to plant varieties, and that the Munich Con- World Trade Organisation (WTO). It has been signed by vention took that option. the European Community (OJ 1994 L 336, p. 213).

15. In order to improve that situation, which was not conducive to bringing about the internal market in the agricultural sector, the Commission had proposed, in its 1985 White Paper, some measures of a legislative nature. Faced with the problems inherent in proceeding by consensus, which IV — The Community system of legal were brought to light in the negotiations to protection for new plant varieties introduce the Community patent, 19 the Community authorities opted for a change in strategy with regard to plant varieties and used legislation to ensure the establish- ment of a system of protection which was uniform throughout the Community. Sev- eral years of interinstitutional collaboration culminated in the adoption of Regulation No 2100/94. 14. At the beginning of the 1990s, in spite of the existence of the UPOV Convention system, the industrial property rules appli- cable, within the European Community, to plant varieties lacked harmonisation. 15 Added to the fact that Greece, Portugal and Luxembourg 16 did not have a specific law for the protection of plant varieties, 16. In the Commission's proposal of there were two factors which made it 6 September 1990, reference was made to particularly difficult to harmonise the laws Article 43 of the EC Treaty (now, after within the Community: the fact that several amendment, Article 37 EC) relating to the versions of the Convention were in force common agricultural policy, as the legal simultaneously in the Community, 17 and basis of the Regulation and, in line with that, the first recital of the proposal stated that the continued breeding of improved 1 5 — T h a t lack of harmonisation is mentioned by Quintana Marco, L., op. cit., p. 82, and by Mayr, CK., 'Notizie e plant varieties was an essential part of the novità legislative comunitarie ed internazionali", Rivista di Diritto Industriale, A. Giuffrè Editore, Milan, 199.5, Part Three, p. 5 et seq. 16 — Of those three States, only Portugal is currently a member 18 — Ulena Uoselio, J.M., in the book edited and coordinated by of UI'OV (since October 1995). Nuez, F. and others, c i t e d above, p. 85. 17 — Even today, the laws of Belgium and Spain are governed by 19 — These difficulties are mentioned by Massägner Fuentes, J., the 1961 version, as amended in 1972. Of the eleven in Los Derechos de propiedad industrial e intelectual aute remaining Member States, five form part of the Act of el Derecho comunitario: libre circulacion de mercanciasy 1978 and six of the Act of 1991 (according to information defensa de la competencia, IDEI, Madrid, 1991, p. 93 et provided on 7 December 2001 by UI'OV). seq.

17. Although the regulation is in some respects innovative, it is not noted for its originality, since to a large extent it follows the framework established by the UPOV Convention in the Act of 1991. Its pre- amble acknowledges that plant varieties pose specific problems as regards the indus- V — The applicable legislation trial property regime which may be appli- cable, and the regulation therefore seeks to overcome some of the ambiguities inherent in the rules governing plant improvements without openly contravening those rules. It 19. Article 1 of Regulation No 2100/94 is also pointed out that the regulation takes states: '[a] system of Community plant into account existing international conven- variety rights is hereby established as the tions, 20 amongst them — apart from the sole and exclusive form of Community UPOV Convention mentioned above — the Munich Convention and the TRIPS Agreement. Consequently, it implements 21 — Holtmann, M-, 'La protección jurídica de las innovaciones vegetales ¿patente y/o título de obtención vegetal?', in the the ban on patenting plant varieties only to book edited and coordinated by Nuez, F. ana others, cited above, p. 3 5 1 . the extent to which the Munich Convention 22 — The location of the headquarters was decided at the so requires, namely plant varieties as such Intergovernmental Conference on 6 December 1996. may not be patented; in that respect, 2 3 — T h e o r g a n i s a t i o n w a s e s t a b l i s h e d by R e g u l a t i o n N o 2100/94 and given responsibility for considering Regulation No 2100/94 is more consistent applications for Community protection, granting Com- munity plant variety protection rights and approving with the Munich Convention, which denominations of variety. Appeal lies from its decisions, depending on the circumstances, either directly before the Court of First Instance or before the Office itself, which may take the claim to the Board of Appeal, whose decisions are, in turn, open to appeal before the Court of 20 — The first and 29th recitals. First Instance.

24 — Van der Kooij, P.A.C.E., Introduction to the EC Regu- lation on plant variety protection, Kluwer Law Inter- (b) conditioning for the purpose of propa- national, 1997, p. 36: 'It only applies in relation to farmers who use the product of their own harvest for propagating gation; purposes on their own holding'.

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agricultural exemption applies only to 23. In order to fulfil the obligation laid certain agricultural plant species listed in d o w n in Article 14(3) of Regulation paragraph 2, classified in four groups: N o 2100/94, the Commission adopted fodder plants, oil and fibre plants, cereals Regulation N o 1768/95 which gives effect and potatoes. 25 to the agricultural exemption. Farmers who take advantage of that opportunity are to be required to pay an equitable remuner- ation to the holder, which is to be sensibly lower than the amount charged for the l i c e n s e d p r o d u c t i o n of p r o p a g a t i n g material of the same variety in the same The national court is interested in the area. Small farmers, as defined in Regu- interpretation of Article 14(3), sixth indent, lation N o 2100/94, are exempt from that which provides: obligation.

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That information shall refer to the current VII — The views expressed by those who marketing year, and to one or more of the have submitted observations preceding marketing years for which the holder has not previously requested infor- mation.

26. Mr Schulin submits that Regulation N o 1768/95, which gives effect to the agricultural exemption, cannot apply to farmers who, instead of exercising that privilege, prefer to obtain new seed for each marketing year. The holder cannot avail himself of his right under Regulation No 2100/94 to obtain information from farmers against a person who has not used VI — The proceedings before the Court the product of the harvest obtained from planting propagating material of a variety belonging to the holder and, even less, against a person who has not used on his holding any of the plant varieties in respect of which the holder has rights. Otherwise, any farmer at all, merely by virtue of being a farmer, would be at risk of receiving numerous requests for information which, because he would have to respond to them 25. Mr Schulin, Saatgut-Treuhandverwal- p r o p e r l y , w o u l d involve, as well as tung and the Commission have submitted expense, a considerable strain on his time. written observations in these proceedings within the period laid down for the purpose by Article 20 of the Statute of the Court.

He adds that the first acquisition of propa- gating material is an act — of which there is evidence — which creates legal effects for the holder and for the farmer. There- fore, the remuneration for exercising the At the hearing on 21 February 2002, Mr privilege may be paid at the time of Schulin's representative, the representative purchase, so that the farmer chooses of Saatgut-Treuhandverwaltung and the between planting the protected variety once Commission's agent presented their oral or reusing the product of the harvest, the submissions. price being fixed accordingly.

27. According to Saatgut-Treuhandverwal- gating purposes over several planting sea- tung, the Community legislation allows the sons. 26 holder of a plant variety protected under Regulation No 2100/94 to require any farmer to inform him whether he has exercised the privilege and to let him know the extent of the operation. 28. The Commission maintains that the exercise of the agricultural exemption pre- supposes, by any reckoning, the existence of a relationship with the holder since, before the product of the harvest of the protected variety is replanted, they must have concluded some agreement for the first use, either directly, or indirectly by means of the purchase of seeds from a supplier. The Commission considers that, as a general rule, the holder has access to the information relating to the transactions involving his protected varieties. Other- wise, the best thing to do would be to contact the seed wholesalers or other sup- pliers who market his products, before trying to impose on all farmers an enforce- In its view, the holder is not, in principle, in able obligation to supply information. a position to adduce any evidence that the farmer has used the seed of the protected variety on his holding. In theory, the fact that a farmer may have made one purchase of new certified seed of a variety from a supplier is an indication that he could use the product of the harvest for propagation purposes. However, in practice, the holder is not in a position to adduce that evidence VIII — Consideration of the question since, as he does not maintain business referred for a preliminary ruling relations with farmers, he does not know who has made one purchase of certified seed of his plant variety. The holder delivers the base or pre-base seed of the variety to an establishment which 29. By the question which it has raised, the multiplies plants, so that it may manufac- Oberlandesgericht Frankfurt am Main ture the product for marketing. After that, the seed is first sold to cooperatives or wholesalers, reaching users through 26 — It points out that almost ail German farmers use the product of the harvest of protected varieties, since 70% of retailers and resellers. The company points those who have provided it with information had done so out that a farmer who has bought certified with at least one of the varieties mentioned in the request. It is of the opinion that the percentage is still higher, seed may use the product of the harvest, in because it assumes that those who have not supplied information have taken greater advantage of the oppor- particular in the case of cereals, for propa- tunity.

30. I should like to point out, first of all, that this case is the first in which the Court has had to interpret the provisions of Thus, Article 13 specifically defines the Regulation No 2100/94, which establishes commercial transactions requiring the a system of Community plant variety rights authorisation of the holder; these include which coexists with national regimes and transactions made with components of a whose aim is the grant of industrial prop­ variety and also with the material harvested erty rights valid throughout the Commu­ (flowers and fruit, for example), covering nity. 2 7 However, it is not the only case the period from reproduction to storage. pending on this matter; the Oberlandesge­ However, the exercise of Community plant richt Düsseldorf has subsequently referred variety rights is subject to restrictions laid a question for a preliminary ruling in very down in provisions adopted in the public similar terms. 28 interest. Since that includes safeguarding agricultural production, Article 14 of the regulation authorised farmers, under cer­ 27 — However, the Court is not unfamiliar with the concept of tain conditions, to use the product of their the plant variety protection rieht. In its judgments ul Nungesser v Commission, cited above, and Case 27/S7 harvest for reproduction. 30Of the 20 or so Erauw-Jacqueiy | 1 9 8 8 | ĖCR 1919, it considered that species listed in Article 14(2) as covered by industrial property right in connection with the compe­ tition rules. In Case C-377/98 Netherlands v Parliament and Council [2001] ECR 1-7079, both the judgment and the Opinion delivered by Advocate General Jacobs distin­ guished, for the purposes of the grant of patents, between 29 — The fifth recital. plant varieties and inventions whose tecnnic.il feasibility was not confined to any particular plant. See paragraphs 30 — Millelt, T., 'The Community svstem of plant variety 43 and 44 of the judgment and points 135 to 139 of the rights', European Law lienen·. Volume 24, June 1999, Opinion. p. 240: 'The farmer may use the product of his harvest only on his own holding, and may not sell it on e.g. for 28 — Case C-182/01, in which the written procedure ended in propagation to another farmer. Furthermore this auth­ the middle of September 2001. The Obcrlandcsgericht orisation is limited to certain fodder plants, cereals, Dusseldorf states in its order that Saatgut-Treuhandver­ potatoes and oil and fibre plants so that the so-called waltung has lodged hundreds of claims throughout Ger­ farmers' privilege should not be extended to sectors of many against farmers whom it asks whether they have agriculture or horticulture where it was not previously made use of the privilege. common practice.'

In order to facilitate monitoring, which would be practically impossible under those conditions, Article 14(3), sixth indent, of Regulation N o 2100/94 and Article 8 of Regulation N o 1768/95 require the farmer to provide the holder, under The farmers seem to feel that they are contract or on request, with the relevant adversely affected by these rules, because information for him to determine whether they consider that they limit the practice, it is appropriate to seek remuneration, and carried on in the sector from time immem- also the amount of any remuneration. That orial, of keeping part of the product of one requirement to provide information at the harvest in order to make free use of it as request of the holder extends to processors. propagating material in the next. However, the fact is that, as a result of the work of breeders, significant advances have been made in the development of new plant varieties which increase and improve agri- cultural production. Since the obligation to 34. In the light of that legislation, it is a remunerate the breeder for the use of the question of deciding which farmers are product of the harvest for propagating required to provide information: those purposes affects only those who sow a who, with the knowledge of the holder, protected variety on their holding, farmers have exercised the privilege, as M r Schulin who use uncertified seed are exempt from maintains; all farmers, simply because they the obligation to provide information and are farmers, as Saatgut-Treuhandverwal- pay remuneration. Consequently, it is not tung maintains; or, as the Commission possible to state, as M r Schulin's represen- suggests, farmers who, in the past, have tative stated at the hearing, that Regulation sown or planted on their holding propagat-

3 5 . It is clear from the w o r d i n g of Article 14(1) and (3), sixth indent, of Regulation No 2100/94 that, in order to exercise the privilege, the farmer must have sown or planted, on at least one occasion, propagating material of a protected variety and, under Article 13, this could only have 37. The content of the information which been done under licence. the holder is entitled to receive may be specified in a contract concluded with the farmer concerned. I agree with the Com- mission that that contract is additional to the main contract, in which the holder or his representative authorises the farmer to carry out one of the acts listed in Article 13(2) of Regulation No 2100/94, normally agricultural production, including the purchase of propagating material. Consequently, the only farmers under an obligation to provide information are those who, in the past, have acquired propagat- ing material of the protected variety in question. It seems to me fundamental that that obligation cannot be imposed on farmers who have never purchased that material, since they could not have culti- vated it or obtained a harvest which might 38. I also agree that, in the absence of an be used again on their holdings for propa- additional contract concerning the details gating purposes. of the information which has to be pro-

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vided, a legal relationship exists between, farmer's obligation to include it in his on the one hand, the holder, his represen- statement may be for identification pur- tative or the traders authorised to sell the poses and because it is useful to check or propagating material of his protected var- complete it. iety and, on the other, the farmer who purchases it for the first time.

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32 — Kiewiet, B . P . , op. cit.,p. 2: 'Taking action against farmers who are not prepared to pay involves considerable expense 31 — Case C-301/98 KVS International [2000] ECR I - 3 5 8 3 (not least legal costs) and is made even more difficult by paragraph 2 1 . See, also. Case 292/82 Merck [1983] ECR the lack of adequate information about the extent of the 3781, paragraph 12, and Case C-223/98 Adidas [1999] use of seed from protected varieties at individual farm ECR I-7081. paragraph 23 level.

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