Benefit-Sharing Factors

As a result of the authors’ own experience in terms of how benefit-sharing works in practice, specifically the modalities of drafting and negotiating benefit-sharing contracts, coupled with literature review, five factors were identified as being the main objectives and considerations of benefit-sharing associated with utilisation of genetic resources (referred to in this paper as ‘benefit-sharing factors’) (Young & Tvedt, 2017). Listed below and in Table 1 are descriptions of the benefit-sharing factors considered in this study.

• Biodiversity goals: Different goals and objectives, as defined by legal biodiversity acts or treaty’s, may be attained through benefit-sharing. BBNJ context: relevant goals include contributing towards conservation of marine biological diversity of ABNJ, promoting sustainable use of MGR from ABNJ, fostering scientific R&D and promoting fair and equitable benefit-sharing (Art 140, (CBD, 1992; Collins et al., 2020; Harden-Davies et al., 2019; UNCLOS, 1982).

• Direct beneficiaries: The number of individuals receiving benefits will vary according to the type of benefit that is being shared. BBNJ context: a greater number of individuals may have access to MGR data if this is shared, such as via online databases, compared to the number of people who may receive funding to conduct PhD projects on topics related to BBNJ.

• Benefit-sharing significance: The impact associated with different forms of benefit-sharing could be approximately determined in terms of the significance, value and the duration of the impact. For example, impacts could include enhanced employment and contribution towards scientific knowledge. Duration of impacts may vary from weeks to months or years and could give an indication of whether future generations may be positively influenced by the benefit-sharing or not (Harden-Davies et al., 2019). BBNJ context: training courses as part of capacity building initiatives may lead to longer-term positive impacts on a group of people, perhaps linked to enhanced employability, than would be the case for access to MGR data.

• Burden on the user: Users could include any organisations or individual researchers from developed or developing states. If benefit-sharing is a requirement, these users may encounter a degree of burden linked to the process of sharing. This burden may take the form of monetary cost to generate the so-called ‘benefits’ in the first place, such as tailored training courses or a monetary payment, but also the transaction cost of sharing benefits. In addition, the generation and sharing of benefits will involve human labour costs, for example sending experts to beneficiary locations to conduct capacity-building or training initiatives. Time may represent another burdensome aspect. Whilst some types of benefit-sharing require only one simple transaction, other forms may require repeated actions over time. BBNJ context: sharing of benefits in the BBNJ context may involve burdens and costs to the user, for example to set up and organise databases in which MGR data can be stored and accessed, or sending of laboratory equipment as a form of technology transfer.

• Burden on the regulator: A regulator may encounter a degree of burden linked to the process of benefit-sharing, as well as related to the need to build capacity in the context of novel regulation. This may involve raising awareness of and enforcing compliance with applicable legislation. These burdens may be both in terms of monetary costs and human labour costs, similar to those described for the users above. However, for the regulator, these costs may be linked to monitoring and checking compliance of users with the benefit-sharing requirements. BBNJ context: at present, it remains unclear whether there will be a regulator for ABNJ, or who this could be (BBNJ, 2019; Mohammed, 2017). However, in the event that there is a regulator/regulatory body charged with regulating ABS linked to MGR from ABNJ, and benefit-sharing is a requirement, then the regulator may face burdens associated with overseeing the process of benefit-sharing, particularly in terms of monetary costs, complexity and time.

Rationale for Selecting These Five Benefit-Sharing Factors

The reasoning behind the five factors on benefit-sharing is threefold. The first reason relates to the concept of establishing a balanced ABS system as referred to in our previous research (Sirakaya, 2019; Sirakaya, 2020). For an ABS system to successfully establish balance between the user and the provider (in bilateral genetic resources frameworks), so as to fairly distribute benefits arising from utilisation of genetic resources between the users of genetic resources and beneficiaries, it is crucial to ensure that such a system attends to the international biodiversity goals. The authors here specifically explore benefit-sharing options and therefore the factors pay due regard to the international biodiversity goals as identified under our current research as well as the previous research conducted on the matter (Sirakaya, 2020).

Secondly, the five factors were selected since they clearly define and influence the modalities of benefit-sharing and can be negotiated when drafting agreements (Young et al., 2017). The authors believe that these factors, coupled with agreement between users and providers, can promote an objective balance in benefit-sharing.

Multiple stakeholder groups are involved within the BBNJ context and it is of utmost importance that an instrument is developed that attains the needs of all of these groups to the greatest extent possible. A stakeholder-driven MCA is the best available method to achieve this (Brucker et al., 2013) (Sirakaya and De Brucker, personal communication). A recent study conducted by Sirakaya and De Brucker (under review) demonstrates how MCA can been applied to design regulatory frameworks for access to genetic resources in cases which involve multiple stakeholders. As such, the third reason for the selection of the criteria refers to the importance of stakeholder consultation under the MCA. According to34, stakeholders are defined as ‘any individual or group who can affect an organisation’s performance or who is affected by the achievement of this organisation’s objectives.’ Looking into regulatory issues related to benefit-sharing in ABNJ, taking into account Freeman’s definition, five key stakeholder groups were identified: developing states, developed states, civil society, the scientific research community and the private sector (Collins et al., 2020). Although questions remain regarding whether there will be any form of regulatory body in the BBNJ context, this could potentially involve members from both developing and developed states working together to fulfill the role. The scientific research community and private sector represent the potential users of MGR. Developing states and civil society are the likely beneficiary groups who would receive benefits shared from utilisation of MGR from ABNJ.

Stakeholders’ perceptions play a crucial role in MCA conducted on ABS frameworks. This is due to the fact that a balanced ABS system can only be established if there is a reasonable ABS framework that the users would be incentivised to adhere to. The same principle applies to a potential benefit-sharing system for ABNJ. The users (i.e. the scientific research community and private sector) would only be incentivised if there is a foreseeable balance between the impact of being a part of the system and the burden thereof. Likewise, the system would only function as intended if the cost borne to the regulator (including members from developing and developed states) of establishing and maintaining the system is considerably lower than the benefits generated through the system to be shared with beneficiaries (developing states and civil society). In line with this,24 stipulate the ‘need to strike a balance between the right to use and the responsibility to share’. Therefore, by reviewing the balance of potential beneficial impacts (private, social and environmental aspects) versus burden, negotiators may be in a better position to make informed decisions regarding which benefit-sharing options may be most appropriate to consider including as part of a new benefit-sharing framework for ABNJ.

In sum, these five benefit-sharing factors are crucial in establishing a balanced benefit-sharing framework for ABNJ with governance options that attain international biodiversity objectives, as outlined by legal acts and treaty’s, and pay due regard to stakeholder preferences (Collins et al., 2020).

Benefit-Sharing Balance

In order to objectively evaluate different benefit-sharing options in terms of the ratio of potential positive impacts versus associated burden in a fair and consistent manner, an equation was proposed, taking into consideration the five benefit-sharing factors (see Figure 1). Weighted values were used in this study to incorporate consideration of the fact that some benefit-sharing factors may be perceived as more important than other factors and should therefore contribute more to the final score. Different methods can be used to generate the weighting values for different factors. For example, an analytic hierarchy process, case-based reasoning, simple multi-attribute rating technique, mathematical programming or interview approaches could be used (Ho, Xu, & Dey, 2010; Nerini, Howells, Bazilian, & Gomez, 2014; von-Winterfeldt & Edwards, 1986). In this study, the values of weightings were obtained through an interview process. Benefit-sharing factors (G, #, S, U, R) were first each multiplied by an average weighting (a-e) assigned to each factor by interviewees. The three positive, weighted benefit-sharing factor scores are multiplied together, as are the two burdensome, weighted factor scores. The positive aspects are then divided by the burdensome aspects to give a benefit-sharing balance value for each benefit-sharing option.

Weighting the Benefit-Sharing Factors

According to the average stakeholder ranking, biodiversity goals were considered as the most important factor to be taken into consideration when assessing how balanced different benefit-sharing options are. The other four benefit-sharing factors were considered approximately equal in terms of importance (see Figure 2). The range of ranking given by interviewees was greatest for the direct beneficiaries factor, as indicated by the larger error bar in Figure 2. Reasons given by interviewees for these rankings are described below.

Non-Monetary Benefit-Sharing Options

To gather perspectives on benefit-sharing, interviewees were asked to consider the potential influence of different benefit-sharing options on the five benefit-sharing factors (Table 1). Analysis of the 38 and a review of the literature lead to identification of seven non-monetary benefit-sharing options which could be considered in the context of governing the utilisation of MGR from ABNJ (see Figure 3). A description of the options considered in this study, and their significance, can be found in27 and26. Non-monetary benefit-sharing options considered here include:

• Sharing of Raw Data:

  • Metadata;

  • Genetic Sequence Data (GSD) ⁴ , ⁵ , ⁶

  • Biochemical Information

• Sharing of Research Results

• Capacity Building

• Technology Transfer

• Research Directed Towards Priority Needs

The benefit-sharing balance, as calculated using the equation described above, indicated the most favourable balance of beneficial impacts versus burden associated with sharing of GSD and sharing of research results. Sharing of biochemical information, metadata and capacity building received a similar, but slightly lower score. Technology transfer, and in particular research directed towards priority needs, received less favourable balances (see Figure 3B). Reasons given by interviewees for potential positive impacts versus burden associated with different non-monetary benefit-sharing options are described below.

Monetary Benefit-Sharing Options

Analysis of the38 and a review of the literature lead to identification of eight monetary benefit-sharing options which could be considered in the BBNJ context (see Figure 4). A description of the options considered in this study, and why they might be important, can be found in27 and26. Monetary benefit-sharing options considered here include:

• Research Funding

• Salaries

• Joint Ventures ⁸

• Joint IP Rights

• Royalties

• Milestone Payments

• License Fee

• Access Fee

Interviewees were asked to consider the potential impact of different monetary benefit-sharing options on the five benefit-sharing factors. According the benefit-sharing balance calculation, the most favourable monetary benefit-sharing option, in terms of balancing beneficial impacts versus burden, was research funding followed closely by salaries (seeFigure 4B). Joint ventures were considered the next most favourable option, followed by joint IP rights. Access fee, milestone payments, license fee and royalties were viewed as similar in terms of balancing the potential positive impacts versus burden. Reasons given by interviewees for potential positive impacts versus burden associated with different monetary benefit-sharing options are described below.

Interviewees noted that their answers in this section were given under the assumption that commercialisation of MGR is successful and that there will be money to share. This is crucial, because four interviewees out of the ten indicated that they do not believe that there will be any financial profits derived from R&D on MGR, and therefore no money to share.

Development of a Benefit-Sharing Methodology

Benefit-sharing in the context of existing genetic resource frameworks under the Nagoya Protocol (conducted in a bilateral manner) is often considered to lack transparency, clarity and accountability, particularly for monetary benefit-sharing options (Fedder, 2013; Pauchard, 2017; Ruiz-Muller, 2018). For example, when dealing with ABS under the Nagoya Protocol, and since ABS contracts are private and users are not obliged to report what is in the contract, governments do not have access to information regarding the amount of money that flows out as a result of ABS. Making use of a methodology, such as that described in this study, could help to achieve a more favourable balance by negating the issue of transparency, by clarifying the key factors and helping negotiators to make informed decisions. In addition, lessons learnt from the ITPGRFA in terms of aspects to consider as part of an operating, multilateral ABS system may also be useful here (Louafi, 2013; Stannard & Moeller, 2013; Tsioumani, 2018). Ultimately, use of this tool could help to enhance understanding and implementation of benefit-sharing policies/ legislation with greater potential to balance beneficial impacts with associated burden, thereby enhancing workability of the ABS system as a whole. However, challenges with the methodology have been identified during application in this study (as described in the section below) which should be addressed in order to develop a more robust tool for application in a variety of benefit-sharing contexts.

Lessons Learnt from Application of the Methodology to the BBNJ Context

Accurately determining the influence of different benefit-sharing options on benefit-sharing factors, such as the significance, are difficult to measure. Indeed, interviewees found it challenging to give scores for some options, partly because participants may not have fully understood or known how to measure and give an accurate answer. This is a clear aspect of the tool which could be improved in the future through consultation with a greater number of experts on that particular aspect. In addition, given the fact that these questions were asked in the context of ongoing negotiations, it is expected that some participants will have responded with strategic rather than objective answers. This may be the reason why a small minority of interviewees indicated that salaries as a form of monetary benefit-sharing would have a large positive influence on benefit-sharing factors, whilst the authors expected the impact to be moderately low compared to other options. In addition, the authors do not suggest that results collected in this study represent a comprehensive review of stakeholder perspectives on this subject matter. Further interviews with a much larger number of participants would be needed to draw significant conclusion for the BBNJ context. However, it is suggested that the benefit-sharing equation described in this article provides a useful tool and starting point, which can be built upon by decision makers in the future, to include more detailed information gathered from various expert groups, such as likely impacts on potential beneficiaries, to consolidate the perceived balance of beneficial impacts versus burden. In addition, the equation can be tailored according to different policy settings where different benefit-sharing factors and additional nuance may be more appropriate.

Benefit-Sharing Factors

The most important benefit-sharing factor, according to average weights allocated by interviewees (see Figure 1), was the influence on biodiversity goals. This is likely because these goals, in particular conservation and sustainable use of biodiversity, are the primary objective of existing genetic resource frameworks, such as the Nagoya Protocol ⁹ and the Plant Treaty, and as such set the precedence for similar frameworks in the future (BBNJ, 2019; CBD, 1992; FAO, 2001; Nagoya Protocol, 2011; World Health Organization, 2011). In the BBNJ context, it has already been suggested that fair and equitable benefit-sharing related to MGR from ABNJ can enable the international community to address global challenges (Morgera, 2018). These global challenges may be related to environmental protection, social objectives and private economic goals (Brucker et al., 2013; Mohammed, 2017; Morgera, 2018). The particular goals of greatest importance to stakeholders are different in the BBNJ context compared to areas within national jurisdiction, where aspects such as legal certainty are considered most vital (Collins et al., 2020; Sirakaya, 2020). Legal certainty is perceived to be of particularly high importance for private sector users of genetic resources (in order to promote investment), who at present appear to view genetic resources in areas within national jurisdiction as more relevant to them than MGR in ABNJ (Collins et al., 2020; Sirakaya, 2019). As such, the benefit-sharing factors involved in the methodology, and the weighting assigned to each, are likely to vary according to the circumstances.

Non-Monetary Benefit-Sharing Options and Balance of Potential Positive Aspects vs Burden

Interviewee results indicate that sharing of GSD and research results provide the most favourable balance in terms of beneficial impacts versus burden. Technology transfer, and in particular research directed towards priority needs, received less favourable balances (see Figure 3). It has been noted by the Ad Hoc Technical Expert Group on DSI on Genetic Resources under the CBD ¹⁰ that DSI ‘plays an important role in deepening knowledge about biodiversity, identifying and mitigating risks to threatened species, enhancing our ability to track illegal trade, identifying species and the geographic origins of products, and assisting with biodiversity planning and conservation management’. As such, the sharing of this type of information in the context of BBNJ is likely to have a positive influence on the biodiversity goals, in particular the conservation and sustainable use of BBNJ. Sharing of GSD appears to be a relatively straightforward procedure, and it is considered best practice amongst the scientific research community (Devi & Pisupati, 2018). Under the assumption that the BBNJ agreement describes requirements to share GSD in keeping with current practices, through the same current channels (and not through other systems), then this form of benefit-sharing may not incur additional burden on the users of MGR. However, the authors acknowledge the contentious nature of discussions regarding GSD/DSI in multiple fora, including the CBD and the Plant Treaty. Whilst sharing of GSD/DSI itself may be relatively uncontroversial, the potential requirement for monetary benefit-sharing associated with utilisation of GSD/DSI is highly contentious (Kobayashi, 2019). Sharing of research results is thought to have a similar positive effect to the sharing of GSD on enhancing the potential for conservation of marine biodiversity, by helping to build an enabling environment in which MSR can flourish (Harden-Davies et al., 2019).

Technology transfer represented a relatively unfavourable balance. This may be associated with a combination of relatively high expected burden on the users of genetic resources and on the regulators, together with limited potential beneficial impacts. The potential burdens on different stakeholder groups associated with technology transfer are described in26. It is suggested that the degree of burden, in terms of financial cost and administration, will depend on the type of technology, the conditions, how it is funded and how the transfer is managed, but on the whole, these will be more significant than for other forms of non-monetary benefit-sharing. For example, it is generally expected that the funding required for technology transfer will be greater than for other non-monetary benefit-sharing options (Collins et al., 2020). In addition, the owners of technology are often private companies or individuals (Prip, Rosendal, & Tvedt, 2015). As such, transfer of this technology will need to involve consideration of commercial aspects, such as the inherent requirement for private sector entities to generate a return on investment and maintain market competitiveness. Related factors will include appropriate intellectual property arrangements and/ or private economic incentives or public funding, particularly in the circumstance of private ownership of technology (Prip et al., 2015). Moreover, the beneficial impacts linked to technology transfer may be limited by absorptive capacity (or enabling factors) in the recipient state. According to42, successful technology transfer depends on three factors: the existence of relevant technology to address particular (environmental) challenges, the relevant dissemination of technology in a manner which makes it available to entities which need this, and the application of technology in a manner which is conducive to solving the challenges in mind.

As noted by interviewees involved in a study conducted by27, research directed towards priority needs would involve a degree of burden associated with making sure that the research precisely benefits the provider country (or in the context of BBNJ, the beneficiary state(s)), because this would require a considerable amount of time, effort and resources. This potential burden is likely to contribute to the less favourable balance for research directed towards priority needs.

Monetary Benefit-Sharing Options and Balance of Potential Positive Aspects vs Burden

According to interviewee results, research funding, followed closely by salaries, were selected as the monetary benefit-sharing options which provide the most favourable balance regarding beneficial impacts versus burden. Access fees, milestone payments, license fees and royalties received less favourable balances (see Figure 4).

The favourable benefit-sharing balance indicated for research funding and salaries may be because there is a greater degree of perceived transparency involved in these approaches, compared to other forms of monetary benefit-sharing, in terms of where the financial resources are directed and how ‘beneficial’ this could be (Altman & Simera, 2010). This transparency with regards to research funding is promoted by funding organisations ^{11 , 12} , science foundations ¹³ , journals and international initiatives, such as the EQUATOR (Enhancing the QUAlity and Transparency Of health Research) network, which aim to encourage transparent reporting of research, research funding processes and the use of reporting guidelines ¹⁴ . In addition, salaries and in particular research funding can directly support R&D on MGR, with potential to enhance conservation and sustainable use of BBNJ.

The less favourable balance indicated for access fees, milestone payments, license fees and royalties may, therefore, be associated with a lack of clarity and transparency in terms of how financial resources are used and how much of a beneficial impact this might have (Altman et al., 2010). Indeed, interviewees involved in this study raised questions and uncertainty regarding how money could be utilised in the scope of monetary benefit-sharing options to promote biodiversity goals, such as conservation and sustainable use of biodiversity. This uncertainty may also be due to the complicated nature of the factors explored. Further research, building on the current study, should be more specific in nature and would likely be simpler for interviewees to respond to, yielding increasingly insightful results. For example, it was suggested that the balance for monetary benefit-sharing options could be more favourable than currently perceived if money could clearly be linked to supporting these goals. Whilst some monetary benefit-sharing options may at some stage create incentives for biodiversity conservation, this would depend on how and where financial resources are allocated. This is currently not as clear or as transparent as processes associated with research funding and salaries (Altman et al., 2010). In addition, the potential impact of benefit-sharing options on bioidiversity goals and the overall benefit-sharing balance may be affected by the approach and language adopted in the new agreement. For example, the 9 text refers mostly to ‘encouraging’ the flow of benefits towards biodiversity conservation, but there is no clear obligation ¹⁵ . The Benefit-Sharing Fund of the Plant Treaty provides a different example, whereby the Contracting Parties decide for themselves the contributions that they will make (Tsioumani, 2018). In order to reach a more favourable balance, it will be necessary to include language in the BBNJ agreement which clearly ties benefit-sharing options to the objectives. This is an important point which should be kept in mind during the negotiation process.

In this study, the authors investigated benefit-sharing options in the manner in which they are currently being addressed in accordance with existing ABS frameworks under the Nagoya Protocol, Plant Treaty and in the draft BBNJ text. When investigating details regarding monetary benefit-sharing options with a view to developing a methodology to balance these with various factors, it became apparent that these options are pooled together under the ‘monetary benefit- sharing’ term without making the distinction between those which accumulate (such as royalties, access fees and milestone payments) and those which distribute funding (such as research funding and salaries). Given that monetary benefit-sharing is already a contentious item in the realm of benefit-sharing, the fact that it is dealt with in this confusing manner is not useful and could prove problematic when translated into practice. This point represents an important finding in the present study. Whilst out of scope of this paper, further research should be conducted in the future to adjust and tailor the formula according to whether the monetary benefit-sharing options generate or distribute funding.

A further factor which might contribute towards the less favourable balance of monetary benefit-sharing options compared to the non-monetary options is the fact that the benefits will need to be shared amongst large numbers of beneficiaries. Whilst sharing of data or information with many people does not dilute or divide the benefits received by each individual/ entity (each can receive the same package of data/ information), the sharing of monetary benefits amongst many beneficiaries will likely result in limited and small amounts of money reaching the beneficiaries. This aspect may contribute towards the perception held by many delegates that non-monetary benefit-sharing could represent more predictable and more significant options than forms of monetary benefit-sharing (Morgera, 2018). By focusing on goals and identified capacity requirements, non-monetary benefit-sharing can have a more immediate and tangible impact on bridging the equity gaps related to R&D on MGR. This approach has been considered the principal success of the Plant Treaty (Stannard et al., 2013; Tsioumani, 2018).