June 4, 2012 - Five million Brazilian farmers are locked in a lawsuit with US-based biotech giant Monsanto, suing for as significantly as 6.2 billion euros. They say that the genetic-engineering business has been collecting royalties on crops it unfairly claims as its personal.
The farmers claim that Monsanto unfairly collects exorbitant earnings every year worldwide on royalties from “renewal” seed harvests. “Renewal” crops are these that have been planted utilizing seed from the preceding year’s harvest. While the practice of renewal farming is an ancient one, Monsanto disagrees, demanding royalties from any crop generation created from its genetically-engineered seed. Since the engineered seed is patented, Monsanto not only charges an initial royalty on the sale of the crop made, but a continuing 2 per cent royalty on each and every subsequent crop, even if the farmer is using a later generation of seed.
"Monsanto gets paid when it sell the seeds. The law gives producers the correct to multiply the seeds they get and nowhere in the globe is there a requirement to pay (once more). Producers are in effect paying a private tax on production," Jane Berwanger, lawyer for the farmers told the Associated Press reports.
In the most recent installment of the legal battle erupting in South America, the Brazilian court has ruled in favor of the Brazilian farmers, saying Monsanto owes them at least US$2 billion paid since 2004. Monsanto, however, has appealed the choice and the case is ongoing.
In essence, Monsanto argues that once a farmer buys their seed, they have to pay the international bio-tech giant a yearly fee in perpetuity – with no way out.
At stake is Brazil’s extremely lucrative and ever expanding soybean production. Last year, Brazil was the world's second producer and exporter of soybean behind the United States, according to the AFP report. The crops can be utilised for something from animal feed to bio fuel, and worldwide demand is developing.