Battle Of Unequals: PepsiCo Vs. Gujarat Farmers Case

Recently, American multinational corporation PepsiCo sued 11 Gujarati farmers for ‘infringing its Intellectual Property Right by growing the potato variety, FL 2027, which is used in its Lay’s chips.


  • The company had applied for the registration of two hybrid potato varieties FL 1867 and FL 2027 in February 2011. These varieties were registered under the Protection of Plant Varieties and Farmers’ Rights Act (PPVFRA) in February 2016 for a period of 15 years. This entitled PepsiCo an exclusive right over the registered variety.
  • At the other hand according to PepsiCo, by growing these FL 2027 variety potatoes without licence, the Gujarat farmers have violated its statutory rights.
  • However, facing boycott calls after it sued Gujarati potato farmers, PepsiCo has offered to settle the case if the farmers stop growing the registered potato variety.

PepsiCo’s Views and Claims

  • Section 28 of the Act provides PepsiCo exclusive right to produce the variety and it had invoked Section 64 of the PPV&FR Act to claim infringement of its rights.
  • The section prohibits anyone other than the breeder of seeds or a registered licensee of that variety to sell, export, import or produces such variety.

Farmer’s Claim

  • Farmers cited Section 39 of the PPV&FR Act that protects farmer’s right to save, use, sow, resow, exchange, share or sell his farm produce including seed of a variety protected under this Act, except selling of branded seed of a variety protected under this Act.
  • Farmers argued that their agreement with the company was only that PepsiCo would collect potatoes of diameter greater than 45 mm. However, there was no clarity regarding the potatoes which did not meet the criteria of the contract.
  • Citing this ambiguity in the agreement, farmers claimed that they purchased the registered seeds from known groups and farmer communities had been sowing these for the last four years.

Criticism of PepsiCo’s Claim

  • Rights on a patented seed differ from country to country. In the US, if someone has patented a seed, no other farmer can grow it.
  • But the Section 39(1)(iv) of the PPVFR Act of India has clauses in defence of the farmers in this case.
  • Under the Act, the farmers could save, use, sow, re-sow, exchange, share or sell farm produce, but they shall not be entitled to sell branded seed of a protected variety.
  • The protected seeds in this case were not sold as branded seeds. Therefore, PepsiCo’s claim seems to be invalid.

International Framework Regarding IPR

  • The dominant framework of international intellectual property (IP) law i.e. TRIPS (Trade Related Aspects of Intellectual Property Rights) and the UPOV (Union for the Protection of Plant Varieties), gives plant breeders exclusive rights over the varieties they develop, and mostly disregards customary rights of indigenous and farming communities to their genetic resources and associated knowledge.
  • This bias has percolated to various national laws, rendering ownership claims of farmers subordinate to corporate breeders’ rights.
  • Recognising the bias in international law, the Indian PPV & FRA Law (2001) was enacted to grant intellectual property right to plant breeders, researchers and farmers.

Protection of Plant Varieties and Farmers’ Rights (PPV&FR) Act, 2001

PPV&FR Act was enacted in 2001, in conformity with International Union for the Protection of New Varieties of Plants (UPOV), 1978.

  • It aims to establish an effective system for the protection of plant varieties, the rights of farmers and plant breeders and to encourage the development of new varieties of plant.
  • The Act also establishes Protection of Plant Varieties and Farmers’ Rights Authority under the Ministry of Agriculture and Farmers’ Welfare.

Different Rights Guaranteed under the Act

Farmer’s Rights

  • A farmer who has evolved or developed a new variety is entitled to registration and protection in like manner as a breeder of a variety.
  • He can save, use, sow, re-sow, exchange, share or sell his farm produce including seed of a variety protected under the PPV&FR Act, 2001.
  • However, he shall not be entitled to sell branded seed of a variety protected under the PPV&FR Act, 2001.
  • It also provides for the compensation to the farmers for non-performance of variety.
  • The farmer shall not be liable to pay any fee in any proceeding before the Authority or Registrar or the Tribunal or the High Court under the Act.

Breeder’s Rights

  • Breeders will have exclusive rights to produce, sell, market, distribute, import or export the protected variety.
  • A breeder can exercise for civil remedy in case of infringement of rights

Researcher’s Rights

  • Researcher can use any of the registered variety under the Act for conducting an experiment or research.
  • They can use the initial source of variety for the purpose of developing another variety but repeated use needs the prior permission of the registered breeder.

Measures India should take to Prevent Future Mishaps

  • Educating Farmers: Farmers must be educated about various agricultural perspectives and must be encouraged with proper incentive structures in order to strengthen their position.
  • Use of Traditional Agriculture System: Farmers should be engaged in agriculture that conserves and improves traditional seeds in situ, rather than with improved proprietary varieties.
  • Create a Rigid Record Keeping System: An immutable record-keeping system, perhaps Blockchain or distributed ledger technology, is needed which will help in eliminating the role of middleman and ensure that the producer gets maximum profit.
  • Use of Blockchain: Micropayments through block chain will ensure monetary returns coming from users and buyers of these seeds, from around the globe. This, in turn, would effectively incentivise cultivation and improvement of indigenous seeds and ensure sustainable growth of both farmers and agriculture in the country.
  • Revive Traditional Ecological Knowledge: India’s invaluable traditional ecological knowledge systems need to be revived and made a part of mainstream agricultural research, education and extension services. Indian treatises like the Vrikshayurveda and the Krishi Parashar falls within the scope of what international conventions such as the Convention on Biological Diversity refer to as indigenous and traditional technologies.

Way Forward

  • It must be a wake-up call for the government and policymakers, who need to do much more to secure sustainable rural societies, protect soil health and promote seed sovereignty for the economic development of Indian farmers and of the entire nation.
  • India must invest more in public research to reduce corporate dominance over agriculture and because private companies are not keen to bring new technology due to intellectual property right infringement, arm-twisting and surrender to farmer-friendly optics by the incumbent government.