LIABILITY AND REDRESS:

1. LIABILITY AND REDRESS: KEY ELEMENTS AND THE AFRICAN PERSPECTIVES Mahlet Teshome Environmental Lawyer-Biosafety African Union Commission Department of HRST Biosafety Unit August 25-27, 2010 Nairobi, Kenya

2. A Historical Account: The Engagement of the AU in the Biosafety Protocol Negotiations • March 2006:COP-MOP3-African Prep. Meeting (Curitiba) • October 2007:WGL&R 4 (Montreal) • March 2008: WGL&R 5 (Cartagena) • May 2008 : COP-MOP 4 (Bonn) • February 2009:FCCL&R 1 (Mexico City) • February 2010: FCCL&R 2 (Putrajaya) • June 2010: FCCL&R 3 (Kuala Lumpur) • October 2010: FCCL&R 4 (Nagoya) • October 2010: COP-MOP 5 (Nagoya)

3. Contents of presentation: • Critical elements/relevant concepts on the L&R negotiations from the African perspective (those adopted and open for negotiation) • African Group positions and few diverging positions • The status quo/Draft Supp. Protocol • Recommendations for setting and maintaining the African Negotiating Approach

4. Relevant concepts/contentious issues • Standard of liability • Absolute=almost no defences are available to the operator, • Strict=no need to establish the fault of the operator (only that the operation caused the damage) • Fault-based=proof of a fault committed by the operator/defendant is required St’d of liability=linked to the perception of the level of risk involved in the operation (perceived as "risky" because of its either high probability of causing damage or the gravity of the potential damage)

5. Standard of liability • Domestic Law Approach (Art. 12(3)(c))

6. 2. Definition of damage and its valuation • Will affect and determine the other provisions of the instrument • Implications further extends to those interested persons, who may bring claims, the type of claims that may be brought and the general objectives of the regime • It is primarily important to determine the minimum damage which calls for redress

7. 2. Definition of damage ..contd • Article 27 of the Protocol simply refers to “damage resulting from transboundary movements” of LMOs without further indicating what constitutes damage. So, damage to be covered must be: a) damage that b) resulted from the transboundary movement of LMOs • The Protocol also covers adverse effects on the i) conservation and ii) sustainable use of biological diversity taking into account risks to human health. • The ‘sustainable use’ of biological diversity refers to use of its components (Art. 2 of the CBD)

8. 2. Definition of damage..contd • Ecosystems are also covered by the CBD: in-situ conservation of ecosystems and natural habitats and the maintenance and recovery of viable populations of species in their natural surroundings (preamble) • Therefore, the broad types of damage to be covered are reinforced in the CBD itself. • Art. 26 contemplates "socio-economic considerations arising from the impact of LMOs on the conservation of and sustainable use of biological diversity"

9. 2. Definition of damage ..contd • Threshold of damage-also problematic. • In principle damage must exceed a de minimis threshold for liability to arise. • In some of the treaties on liability, the terms “significant harm” or “significant damage”, “above tolerable levels”, “in excess of the prescribed standard” are used as an indicator for threshold of damage. • The Biosafety Protocol refers to “adverse effects” or “significant adverse effects” (Art. 17(4)) on the conservation and sustainable use of biological diversity” and it would be taken such terms constitute the threshold. • African Group=broad interpretation of damage

10. 2. Definition of damage ..contd

11. 3. Causation and Burden of Proof Causation/“causal link”=the link law establishes between an event, action or omission and specific damage . • normally required for both fault-based and strict liability)

12. 3. Causation ...cont’d AFRICAN GROUP The following factors makes it hard to establish causation in a legally predictable and consistent manner: • the complexities of interaction between an LMO and the environment; • the lack of scientific evidence on the permanent containment of the genetic material of the LMOs or its long term impact on human health andthe attending impacts on ecosystems; • the time scalefor the impact The precautionary approach-burden of proving causation should be reversed. Where there are multiple possible causes or a combination of causes, it may be very difficult to prove the damage was caused by the LMO • These factors call for "reversal of burden of proof" or "rebuttable presumption” that damage was caused by the LMO

13. 3. Causation ...cont’d DRAFT SUPP. PROTOCOL (*Adopted*) A causal link must/shall be established between the damage and the LMO in accordance with domestic law (Art.4)

14. 4. Channelling Liability • Channeling of liability=identification of the actor liable for damage. • In most cases of liability, damage is channeled to the "operator", being the person that has operational control of the activity at the time of the incident causing damage.

15. 4. Channelling Liability AFRICAN GROUP • Most transboundary transactions involve a chain of operators who have control of the substance or activity at different stages, ranging between the person who arranges export of the substance and the person who takes charge of the substance at the destination. • As such, liability could be spread jointly among several actors (joint and several liability). DRAFT SUPP. PROTOCOL (*Adopted*) • Broad definition and allows domestic law to include different categories of persons (Art.2(d))

16. 5. Right to bring claims/Standing • Usual practice-only entities which could show direct interest, having suffered some damage or loss, could file for civil action for compensation. • Protection of the environment is in the public interest-this rule is extended in environmental law and almost any entity could act on behalf of the public • Access to justice is increasingly allowed to private organizations (NGOs/CSOs) in national legislations (African Group) • Draft Supp. Protocol Art.12 (3) (d)-National Law approach (*Adopted*)

17. Limitation of liability/exemptions • Commonly accepted exemptions from liability include: • acts of God (force majeure); • acts of war or civil unrest; • intervention by a third party. • Authorization • State of the art African Group • Exemption shifts the risk to the victim or just leaves the damage where it falls or leaves the environment without prevention or remedy

18. Limitation of liability ...cont’d African Group …cont’d • To allow exonerationfrom liability in the case of force majeureor Act of Godshifts liability from the producer to thedamaged farmer and/or public. • particular drawback for LMOs because by their nature involve genetic modification, evolution and other biological events that may qualify as Act of God, • SA=in support of this exemption

19. Limitation of liability (African Group ..cont’d) • Exemption of ‘Act of war or civil unrest‘-raised some concerns specific to LMOs. • It has been suggested, that LMOs can be used to produce bioweapons, such as LMOs producing a toxin or venom, or to attack crops. If LMOs are released intentionally to cause damage, then an exemption should not automatically apply to exempt actors in the exporting State. SA=in support of this exemption • ‘Intervention by a third party’-the liable party should be exempted because a third party’s actions may have contributed to or caused the damage. • However, this simply amounts to an introduction of element of fault. The damage is still caused by the LMO and should be covered

20. Limitation of liability, exemptions and mitigation (African Group ...cont’d) • ‘Compliance with compulsory measures imposed by national authority'/authorizationamounts to the introduction of an element of fault, since it shifts the blame to the national authority • The fact that an operator is complying with permission, standards or controls should not excuse the operator from liability (still less mean that the environment is not protected). • Those standards or controls are at best based on the best knowledge at the time they were imposed. They may also be inadequate, being based on whatever evidence was produced at the time of authorization.

21. Limitation of liability, exemptions and mitigation (African Group ...cont’d) • “The state of the art" defence -where the risk assessment and the state of scientific knowledge at the time of release do not suggest conceivable risk but such risk nevertheless becomes apparent at a later date • Convinced that as per the precautionary approach, this is the kind of damage that should be covered. • The modification of genes may give rise to unexpected consequences. • The fundamental principle should be that the environment should be protected. Draft Supp. Protocol=Act of God, act of war or civil unrest+ any other (domestic law approach)-*Adopted*

22. Scope AFRICAN GROUP • Functional Scope-scope of liability and scope of damage. • Art. 27 of the Protocol stipulates that damage resulting of transboundary movement of LMOs should be redressed-all damage stemming from such movements is refereed to under the Protocol. • It is critical that the scope be broad and applies to the transport, transit, handling and/or use of LMOs resulting from the transboundary movement of LMOs. • Both intentional and illegal transboundary movements of LMOs should also be included.

23. 7. Scope …cont’d • Geographical Scope-weather or not damage in areas outside national jurisdiction should be covered • the issues under deliberation in this regard were of damage beyond national jurisdictions such as the high seas and damage within the territories of non-contracting parties. • the issue of how the regime addresses non-parties (esp. when the LMO is exported from a non-party). (Art 3 (k) and 24 of the CPB) • Under Art. 3(k) of the Protocol, for the purposes of Articles 17 and 24, transboundary movement extends to movement between Parties and non-Parties. • Article 24 requires that transboundary movements of LMOs between Parties and non-Parties shall be consistent with the objective of the Protocol • The two articles underscore that a liability instrument should not exclude movements to and from non-parties (African Group)

24. 7. Scope ..cont’d DRAFT SUPP. PROTOCOL: (Art. 3)-(Functional and Geographical-*Adopted*) • Damage that occurred within areas of national jurisdiction of Parties -Art.3(5) • Parties could set criteria in domestic laws on how to deal with damage within their jurisdictions-Art. 3(6) • Domestic law shall also apply to damage from transboundary movement from non-Parties-Art.3(7)

25. 7. Scope ...cont’d • Products of LMOs *Not Adopted* African Group: • Risk Assessment procedures under the CPB include ‘products thereof’ (i.e. processed materials that are of LMO origin)-Annex III • If risk assessment procedures consider associated risks of products, it is rational to consider liability emanating from damage with regards to products South Africa: • Is not in support of ‘products thereof’ within the scope • Needs agreeable definition of ‘products’.

26. 8. Coverage/Financial Security *Not Adopted* • Voluntary financial security, a compulsory financial security or a domestic law approach. African Group: • If the liability of the operator is not secured by insurance or other financial guarantees, then the potentially liable party can simply avoid exposure through undercapitalization, limited liability companies etc. • If the risk is uninsurable, there is no justification for the risk to be undertaken. Otherwise the risk is simply transferred to the victim, the public or the environment

27. 8. Financial Security ...cont’d South Africa: Mandatory financial security requirements should not be imposed on Operators by Parties. Draft Supp. Protocol: Art. 10-Open for negotiations • Discretion to Parties to require Operators to establish financial security including self insurance (‘may’) • Discretion to Parties to handle such issues consistent with relevant international law/obligations • Obligation to Parties to require Operators to establish financial security

28. Setting the African Negotiating Approach The need for fortified national systems • Country positions depend on possession of effective national laws on environmental liability • Environmental liability laws need to take on board the current trends in environmental damage, • African scientists should tailor biotechnology or the production of LMOs to African needs and not just in the interest of the global market. • When it comes to imported LMOs, a strong legally binding international regime will protect the interests of importing countries without placing undue strain on domestically produced and consumed LMOs.

29. Need for coordination with like-minded Parties and setting the minimum criteria to serve African needs • Because of individual interests of many Parties which may not concur with that of the African Group, a coordinated compromise position may not fully be achieved through negotiation. Nevertheless maintaining the minimum which satisfies some aspirations of the African group should be endeavoured. • Since the current challenge of most African countries is lack of a domestic legal system, a preferable approach to strike a balance, could be negotiation on elements to strengthening this weakness. • Coordinating with a like minded group could also be a critical strategy to strengthen African positions.

30. Maintaining a Negotiating Approach • Taking in to account its own environmental specificities, Africa should take its own position in the definition of damage on liability and redress; • Africa could draw on the experience of global cases in developing a harmonized compensation scheme; • The liability rules could benefit from other international regimes related to the subject of liability and redress; • Reference to the African Model law as a guideline to the African common positions could be made; • A liability and redress regime should be legally binding and should unequivocally consider the environmental specificities of all countries and shouldn’t be tailored into a one-size-fits all approach; • Building a national liability and redress regime is critical and could serve as leverage in negotiations for international rules.

31. THANK YOU FOR YOUR ATTENTION !Contact details:Department of HRSTBiosafety UnitTel:+251113717770Fax:+251113717707E-mail: mahletk@africa-union.orgWebsite: www.africa-union.org