BIODIVERSITY ACT
1. Context
Recently Lok Sabha (July 25, 2023) gave its approval to a Bill to amend some provisions of the Biological Diversity Act of 2002. The Biological Diversity (Amendment) Bill seeks to address the concerns of several central ministries, state governments, researchers, industry, and other stakeholders, regarding the implementation of the 20-year-old law that is meant to preserve the country’s biological diversity and to ensure its sustainable use.
2. Biodiversity Act, 2002
- The Biodiversity Act 2002, officially known as the Biological Diversity Act, is a significant legislation in India aimed at the conservation, sustainable use, and equitable sharing of biological resources and associated traditional knowledge.
- Enacted on 5th February 2003, the act recognizes the importance of biodiversity conservation and the traditional knowledge of local communities in achieving sustainable development.
3. Key Objectives of the Biodiversity Act 2002
- Conservation of Biodiversity: The primary objective of the act is to conserve the biological diversity of India by regulating access to biological resources and associated traditional knowledge.
- Sustainable Use: The act emphasizes the sustainable use of biological resources to ensure their availability for present and future generations.
- Equitable Benefit Sharing: The act recognizes the rights of local communities and indigenous people over their traditional knowledge and promotes equitable sharing of benefits derived from the use of biological resources and associated knowledge.
4. Key Provisions of the Biodiversity Act 2002
- Biodiversity Management Committees (BMCs): The act mandates the establishment of BMCs at the local level to facilitate biodiversity conservation and sustainable use. These committees play a crucial role in regulating access to biological resources and associated traditional knowledge.
- Access and Benefit Sharing (ABS): The act requires individuals, institutions, and companies to obtain prior approval from the National Biodiversity Authority (NBA) before accessing biological resources and associated knowledge for research or commercial purposes. It also mandates the sharing of benefits arising from the use of these resources with the concerned local communities.
- National Biodiversity Authority (NBA): The act establishes the NBA, an autonomous body under the Ministry of Environment, Forest, and Climate Change, responsible for granting approvals, monitoring access to biological resources, and overseeing the equitable sharing of benefits.
- Biodiversity Heritage Sites (BHS): The act empowers the government to notify certain areas as BHS to conserve biodiversity and promote traditional practices related to conservation.
- Protection of Indigenous Knowledge: The act safeguards the traditional knowledge of local communities and indigenous people by prohibiting the unauthorized use or exploitation of such knowledge.
- Offenses and Penalties: The act prescribes penalties for offenses like accessing biological resources without permission, non-compliance with ABS provisions, and misuse of biological resources, to ensure compliance and deter violations.
5. The need for amendments to the Biodiversity Act 2002 arose due to various reasons:
- Stakeholder Concerns: Several stakeholders, including representatives from the Indian system of medicine, the seed sector, pharmaceutical, and other industries, and the research community, expressed that certain provisions of the 2002 law imposed restrictions on their activities. The amendments sought to address these concerns and create a more conducive environment for their operations.
- International Obligations: With the adoption of the Nagoya Protocol in 2010, an international agreement under the Convention on Biological Diversity (CBD), countries agreed to implement access and benefit-sharing mechanisms. The amendments to the Biodiversity Act were necessary to align with the provisions of the Nagoya Protocol and ensure that India fulfills its international commitments.
- Encouraging Traditional Medicine: The Indian government has been actively promoting traditional systems of medicine, such as Ayurveda, Unani, and Siddha, which heavily rely on biological resources. The amendments aimed to facilitate access to these resources for research and development in traditional medicine practices.
- Enhancing Benefit Sharing: The amendments sought to strengthen the benefit-sharing mechanism to ensure that local communities, especially those in biodiversity-rich areas, receive fair and equitable benefits from the utilization of biological resources.
6. What amendments have been proposed in the biodiversity law?
- Exemptions for Traditional Medicine Practitioners: The proposed amendments to the Biodiversity Act 2002 exempt certain categories of users of biological resources, specifically practitioners of Indian systems of medicine, from making payments towards the access and benefit-sharing mechanism. This exemption is aimed at encouraging and facilitating research and development in traditional medicine practices.
- Indian Companies' Definition: The amendments clarify that companies registered in India and controlled by Indians will be treated as Indian companies, even if they have foreign equity or partnership. This change reduces the restrictions on such companies, enabling them to access and utilize biological resources more seamlessly.
- Streamlined Approval Process: The proposed amendments include provisions to expedite the approval process for the use of biological resources in scientific research and for filing patent applications. These streamlined procedures aim to promote research and innovation while ensuring compliance with access and benefit-sharing requirements.
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For Prelims: Biodiversity Act, 2002, Biodiversity Management Committees (BMCs), Access and Benefit Sharing, National Biodiversity Authority (NBA), Biodiversity Heritage Site (BHS), Convention on Biological Diversity (CBD), and Nagoya Protocol.
For Mains: 1. Discuss the key provisions and significance of the Biological Diversity Act, 2002 in India's efforts towards biodiversity conservation, sustainable use of biological resources, and equitable benefit sharing. (250 words)
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Previous year Question1. How does National Biodiversity Authority (NBA) help in protecting Indian agriculture? (UPSC 2012)
1. NBA checks the biopiracy and protects the indigenous and traditional genetic resources.
2. NBA directly monitors and supervises the scientific research on genetic modification of crop plants.
3. Application for Intellectual Property Rights related to genetic/biological resources cannot be made without the approval of the NBA.
Which of the statements given above is/are correct?
A. 1 only
B. 2 and 3 only
C. 1 and 3 only
D. 1, 2 and 3
Answer: C
2. With reference to India, consider the following Central Acts. (UPSC 2011)
1. Import and Export (Control) Act,1947.
2. Mining and Mineral Development (Regulation) Act, 1957.
3. Customs Act, 1962.
4. Indian Forest Act, 1927.
Which of the above Acts have relevance to/bearing on biodiversity conservation in the country?
A. 1 and 3 only
B. 2, 3, and4 only
C. 1, 2, 3 and 4
D. None of the above Acts
Answer: C
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Source: The Indian Express
DELISTING SECURITIES
1. Context
The Securities and Exchange Board of India (SEBI) is actively reviewing delisting regulations to address the issue of share manipulation among listed companies. The focus is on mitigating the misuse of the 'reverse book-building' process during delisting and introducing a fixed price option for delisting shares from the stock exchanges.
2. About Delisting of Securities
Delisting involves removing a listed company's securities from a stock exchange, rendering them non-tradable on the exchange.
Voluntary Delisting In voluntary delisting, a company decides on its own to remove its securities from the stock exchange, subject to specific buyback requirements.
Compulsory Delisting Compulsory delisting occurs as a penal measure when a company fails to comply with requirements set out in the listing agreement within prescribed timeframes.
3. Current Delisting Process: Reverse Book-Building
Reverse book-building is the existing process used for price discovery during delisting. Shareholders submit offers to sell their shares at various prices, and the buyback price is determined after the offer closing period.
Manipulation Concerns SEBI chairperson Madhabi Puri Buch highlights the risk of manipulation by certain market participants, who, in anticipation of delisting, acquire shares and artificially inflate their prices to unsustainable levels.
4. SEBI's Proposed Changes and Review
Fixed Price Delisting SEBI is considering allowing companies to delist shares at a fixed price, instead of relying solely on the reverse book-building mechanism.
Seeking Stakeholder Feedback SEBI has received recommendations from a committee headed by Keki Mistry, the former vice-chairman and CEO of HDFC Ltd, on delisting norms. The regulator plans to seek comments from various stakeholders before implementing any changes.
Balancing Interests The review aims to strike a balance between the interests of promoters and shareholders in the delisting process. The current 90% threshold for successful delisting poses challenges that require attention.
5. Benefits and Challenges of Fixed Price Delisting
Enhanced Fairness The fixed price delisting mechanism seeks to address concerns related to fairness and prevent undue price inflation during delisting.
Methodology Details Crucial Experts caution that the effectiveness of the fixed price method depends on the specific formula used to arrive at the fixed price. The methodology must ensure robustness and avoid challenges in valuing shares and determining floor prices.
6. Conclusion
SEBI's review of delisting regulations demonstrates its commitment to curb manipulation and enhance fairness in the delisting process. Introducing a fixed price mechanism and seeking stakeholder feedback can lead to a more transparent and equitable delisting process, benefiting both shareholders and promoters in the Indian capital markets.
