PepsiCo, a global conglomerate worth millions, has recently locked horns with Gujarati farmers in a legal battle. The dispute revolves around the farmers’ alleged infringement of PepsiCo’s Intellectual Property Rights, for which the company is demanding ₹1.05 crore from each farmer. This apparent violation relates to the cultivation of a potato variety that PepsiCo uses in its popular product, Lays chips.
Settlement Proposal from PepsiCo
Following boycott calls garnered by the lawsuit, PepsiCo proposed a settlement on the condition that the farmers cease growing the disputed potato variety. In legal terms, PepsiCo relies on Section 64 of the Protection of Plant Varieties and Farmers’ Rights (PPV&FR) Act, 2001 for its claims. This section restricts anyone but the breeder of seeds, or a licensee, from selling, importing, exporting, or producing the specific variety.
The Farmers’ Perspective
However, the farmers’ groups counter PepsiCo’s claim by referring to Section 39 of the PPV&FR Act, 2001. This provision permits farmers to cultivate and sell any crop or seed variety, as long as they do not sell branded seed of registered varieties. The farmers have sought the intervention of the government and the Protection of Plant Varieties and Farmers’ Rights Authority (PPV&FRA) to defend them in court using funds from the National Gene Fund.
| Title | Description |
|---|---|
| Protection of Plant Varieties and Farmers’ Rights (PPV&FR) Act, 2001 | This legislation aims to protect plant varieties, the rights of farmers and plant breeders, and to motivate the development of new plant species. It establishes the PPV&FRA under the Ministry of Agriculture and Farmers Welfare and delegates responsibilities like plant variety registration, documentation, and preservation. |
| Rights under the Act | The Act grants rights to breeders, researchers, and farmers. Breeders have exclusive rights over production and marketing. Researchers can use registered varieties for experiment or research, while farmers can save, use, sow, re-sow, exchange, share, or sell their farm produce, except for branded seed of registered varieties. |
| National Gene Fund | Established in 2007 under the PPV&FR Act 2001, this Fund began with a ₹50 lakh contribution from the Central government and is further funded by plant breeders’ registration and annual fee contributions. |
| Contract Farming | In contract farming, the farmer and buyer enter into an agreement specifying the production and marketing conditions for a specific agricultural product(s). The farmer commits to supplying agreed quantities of the product at predetermined times, and often, the buyer assists with farm inputs, land preparation, and technical advice. |
The Potato Variety in Dispute
The potato variety at the center of this dispute, FL 2027, commonly referred to as FC5, is reported to be exclusively owned by PepsiCo following their acquisition of a Plant Variety Certificate (PVC). Consequently, the company insists that any unauthorized cultivation of this variety constitutes an infringement of their rights under the PPV&FR Act, 2001. Yet, the farmers’ groups maintain that they are within their rights to grow and sell any crop variety that is not a branded seed of registered varieties, instigating the ongoing legal dispute.
